SAN FRANCISCO (January 20, 2004) -- Critical Path, Inc. (Nasdaq: CPTH), a global leader in digital communications software and services, today announced that it has signed definitive agreements for the purchase of a total of $15 million in convertible notes. Investment entities affiliated with Apex Capital, LLC have invested $11.25 million and an entity affiliated with Passport Capital, LLC has invested $3.75 million.
The investments consist of 10% senior secured notes, which will convert into approximately 10 million shares of Series E preferred stock upon shareholder approval. The Company plans to submit the issuance of these shares to shareholders for approval in the first quarter of 2004, in accordance with the rules of the Nasdaq Stock Market.
"These new investments are very significant for the Company and will substantially strengthen our balance sheet," said William McGlashan, Jr., chairman and chief executive officer of Critical Path. "The going concern qualification issued by our external accountants in December 2003 was predicated on the Company's need to raise additional capital in the first quarter of 2004."
The affiliates of Apex Capital and Passport Capital are new investors in the Company. Their investments are separate from -- and in addition to -- the financing transactions announced by the Company in November 2003. These included the raising of $10 million in capital from General Atlantic Partners and an agreement to convert approximately $33 million of debt held by a group of investors led by Cheung Kong Group and its Hutchison Whampoa Limited affiliates.
The securities have not been registered under the Securities Act of 1933, or the securities laws of any other jurisdiction, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.
Ernst van der Ploeg
Regional Sales Director
for Critical Path BENELUX
+31 (0) 6 512 77060 phone
+31 (0) 6 105 48013 fax
A Global Leader in Digital Communications Software and Services