RealTime IT News

I-Storm Raises $5 Million Gross Proceeds From Private Placement

Palo Alto, CA-based I-Storm Inc., which plans to build and operate e-commerce storefronts on the Web, said it completed a private placement offering resulting in gross proceeds of $5 million.

The company issued 9 percent Series B Cumulative Convertible Preferred Stock. A total of 407,900 Series B shares were sold at a price per share of $12.25. Net proceeds of $4.4 million were realized after investment banker fees and expenses of approximately $0.6 million.

The majority of the proceeds were used to retire the company's outstanding bridge loans, to almost retire its loans under a factoring agreement, and to pay down many of its outstanding expenses and professional fees. The balance of the proceeds will be used for the development of I-Storm Cyberstores and for general working capital purposes.

Weatherly Securities Corp., the placement agent, also received 1 million shares of common stock and warrants to purchase 40,790 shares of Series B preferred stock.

I-Storm said it plans to partner with Fortune 500 companies to develop online stores. By leveraging its partner's existing brand, fulfillment, service and support structures, I-Storm will focus on its core competencies of storefront construction and online selling, while the partners stay focused on their existing businesses and traditional markets.