SMF Energy announces $40M recapitalization - Silicon Valley / San Jose Business Journal:

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The company (NASDAQ: FUEL) said in a news release that it estimatess the recapitalization will reduceeits short-term debt by $9.5 million, its totakl debt by $4.4 million and its cash requirements for interestg and dividends by more than $1 milliohn a year. It said equity has been increased by morethan $4 milliohn as a result. SMF Energy said it extinguishedd all of itsexisting non-bank debt and outstanding preferred stockl through various agreements with dozens of existing debt and equityu investors, while converting its existing $25 million asset-based lending facilityh into a new, more favorable, $20 million asset-based lending facility and a $5 60-month amortized term loan, the proceeds of which were used to pay down $4.
866 million in secured notes and $125,000 in unsecuref notes. The company said it issueed new stock to make up the balancee paid for the cancellation and extinguishmentg of theexisting investors' debt and equity securities. Fort Lauderdale-baseds SMF Energy said in the release that the recapitalizationm took place with amended agreementz withand . It said the only non-bano debt incurred in the recapitalization was an unsecured subordinateds promissory noteof $800,000 at 5.5 percent interest issueed to an existing institutionakl investor in exchange for $800,000 of one of the Augusg 2007 11 percent seniotr secured convertible promissory notes.
The institutionaol investor alsoexchanged $200,000 of the same secured note for sharews of common stock priced at 38 cents a which was greater than the closing bid price of the stocl on the day before the effective date. acted as SMF Energy’sa placement agent for the recapitalization and received fees of paid with a combination of cash and pursuant toa Feb. 1 investmentg banking agreement. SMF Energy suppliees specialized transportation and distribution services for petroleum productseand chemicals. It provides commercial mobil e andbulk fueling, along with other services to the manufacturing, construction, energy, telecommunications and government services sectors.
Formerlyy known as , as of Nov. 30, it conducted operationds through 31 service locations in11 states. Shares close down nearly 3 cents to about 35 The 52-week high was 71 cents on Aug. 28. The 52-weeik low was 10 cents on Feb. 20.