Excite dunned for $50 M in convertible note payback
It isn't panicking exactly, but on the heels of public doubt about its ability to survive, ExciteAtHome was dunned today by two holders of its convertible notes who want their $50 million. Excite is disputing the demand.
The two holders, investment funds managed by Promethean Investment Group LLC, gave an Aug. 31 deadline. Excite says the notes were issued June 8.
Promethean says Excite breached representations stemming from the time the notes were issued. Excite says that it is disputing the breach charge and the "contention that the notes may now be declared due and payable."
Excite adds that paying the notes now would have a materially adverse impact on its liquidity and ability to fund operations.
Promethean could not be reached for comment.
Last week, Excite fired its auditors after the accounting firm noted its doubt that the company could continue as a going concern. The doubt echoed Excite's in the same SEC filing. Excite promptly replaced Ernst & Young LLP with PricewaterhouseCoopers.