Published On: Thu, Jun 30th, 2016

Towerstream Corporation (NASDAQ:TWER) Conducts Registered Direct Offering To Raise $2.28 million

Towerstream Corporation (NASDAQ:TWER) has filed a form 8-K revealing that the company has entered into a material definitive agreement, with some of its accredited investors. The agreement concerned a registered direct offering, from TWER, to the investors for purchase of $2.28 million’s worth of the company’s common stock. As per the agreement, the investors would acquire a total of 15 million shares of TWER’s common stock, at $0.152 per share.

In addition to the common stock, the purchasers would receive a 5 year warrant, per share, exercisable at a price of $0.25 per share. The company is yet to disclose what it plans to do with the proceeds from the agreement. This was the first major financial event, since the appointment of the company’s new CFO Frederick Larcombe. The new CFO was appointed on June 8, 2016, effective from June 14, 2016.

TWER recently issued an updated guidance for its 2Q2016. The company reported that a total of 145 on-net contracts were signed during the two months of April and May. Moreover, 52% of these contracts were secondary customer contracts, which are also the most profitable offerings from the company. As such, the company’s average percentage revenue per contract rose to 35%, for the same period.

Apart from making progress in terms of revenue, Towerstream also revealed that it had successfully shortened its installation time, from months to just weeks. However, the main highlight of the update was the successful signing of an agreement with a large commercial property owner, in NYC, to provide on-net services.

The CEO of TWER, Philip Urso, revealed that on-net is a win-win for both the customer and the company. He went on to state that the customer gets fiber quality high-speed internet, at about 40% of the actual cost. On the other hand, the company is able to focus its staff and efficiently utilize capital, towards a specific type of contract.

Towerstream Corporation (NASDAQ:TWER) closed at a share price of $0.18, after gaining 22.45% during the June 29 trading session.

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