QMRK News QualMark Corporation Announces Conversion of the Remaining Outstanding Preferred Shares into Common Shares
DENVER--(BUSINESS WIRE)--Aug. 30, 2006--QualMark Corporation (OTCBB: QMRK), a world leader in designing, manufacturing and marketing HALT (Highly Accelerated Life Testing), HASS (Highly Accelerated Stress Screening) and electro-dynamic systems, today announced the conversion of all of the outstanding Series C preferred shares into common shares, which eliminates all outstanding preferred stock on the QualMark balance sheet.
Upon conversion of the Series C preferred shares, QualMark's outstanding common shares will increase to approximately 8.8 million and stockholders equity will increase to approximately $6 million. The conversion of the Series C preferred shares will eliminate the preferred stockholder's right to receive a preferential distribution and cumulative dividend. The conversion also eliminates the preferred stockholder's right to redeem the preferred shares, which would have created an additional debt overhang to the Company.
Charles Johnston, QualMark's President and CEO, stated: "This event follows the conversion of the Series B preferred shares that occurred two weeks prior and completely eliminates all outstanding preferred stock on the QualMark balance sheet. The conversion will result in a simpler equity structure. It also eliminates the dilution and preferred dividend cost to the Company, as well as the debt overhang that previously existed. The conversion of the preferred shares propels the Company one step closer to meeting listing requirements of a major exchange."
James Roser, Manager of the General Partner of The Roser Partnership III, SBIC LP and sole holder of the Series C preferred shares, stated, "Our decision to convert the Series C preferred shares is attributable to our continued commitment to help the Company move forward and attain their strategic goals." Roser continued, "Our intent is to support and help build QualMark into the world-class organization that we feel it can be."
QualMark Corporation, headquartered in Denver, Colorado, is the leader in designing, marketing, and manufacturing accelerated life-testing systems (HALT and HASS), providing the world's largest corporations with solutions that improve product reliability and allow them to get to market faster. The Company has installed more than 700 of its proprietary testing systems in 30 countries. The Company operates and partners with ten testing facilities worldwide.
The Company also offers electro-dynamic vibration solutions through its subsidiary, Ling Electronics.
Ling Electronics, headquartered in West Haven, Connecticut, is the leader in supplying electro-dynamic systems, components, and service to the worldwide vibration test equipment market.
The statements included in this press release concerning predictions of economic performance and management's plans and objectives constitute forward-looking statements made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. These statements involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors which could cause or contribute to such differences include, but are not limited to, factors detailed in the Company's Securities and Exchange Commission filings; downturns in the Company's primary markets; variability of order flow, future economic conditions; competitive products and pricing; new product development; disruptions in the Company's operations from acts of God or extended maintenance; transportation difficulties; or the delivery of product under existing contracts and other factors.
