LOS ANGELES, May 5 /PRNewswire/ -- Vertical Computer Systems, Inc. (OTC Bulletin Board: VCSY) announced today that it has received a commitment for $2,000,000 through the private placement of its Series "A" Preferred Stock. The placement has made available a minimum of 10,000 shares of its Series "A" Preferred Stock at a price of $200 per share with each preferred share convertible into 500 shares of the Company's restricted common stock. The investor is to close on this private placement by May 12, 2000 unless extended by both parties. This financing is separate from the financing brokered by Avenel Financial Group. The Series "A" Preferred Shares will have the same rights and preferences as those placed by the Avenel Financial Group.
As previously reported, Vertical Computer Systems, Inc. (Vertical) announced on March 1, 2000 that Avenel Financial Group (Avenel) had exercised stock purchase warrants for 1,000,000 shares of restricted Vertical stock at $1.00 per share for a total cash investment of $11,000,000 into Vertical. According to the terms of the Avenel based Financing, adjusted on a post-split basis, Vertical made available 50,000 shares of its Series "A" Preferred Stock at a price of $200 per share with each preferred share convertible into 500 shares of the Company's restricted common stock. Additionally, for every $10 invested into Vertical by Avenel's investment group, the group was entitled to receive a stock purchase warrant to purchase one restricted share of Vertical common stock at a price of $1.00 per share. According to the commitment letter, Avenel agreed that the shares will not have any registration rights, and that they may not be converted into common stock until the expiration of one year. In addition, the common shares issued pursuant to the warrant exercise are restricted for one year and also carry no registration rights.
Vertical Computer Systems, Inc. is a multi-lingual portal provider, and e-commerce solutions company, based in the United States. The Company provides a full range of Internet services that include building e-commerce solutions nationally and internationally, distributing content via its multi- lingual portal network (http://www.TheChinaBridge.com); and Internet services (http://www.thepostmaster.net). Through its majority-owned subsidiary, Externet World, Inc., the Company provides online shopping services (http://www.ShoppingInternet.com) and proprietary online gaming software (http://www.ccpsoftware.com). Vertical Computer Systems is committed to building e-commerce communities on the Internet in the Americas, Europe, Asia and Pacific Rim.
SOURCE: Vertical Computer Systems, Inc.