CirTran Secures $1.5 Million in Financing
SALT LAKE CITY, August 30, 2006 – CirTran Corporation (OTC BB: CIRT), a full-service contract manufacturer of IT, consumer and consumer electronics products, announced today that it has received $1.5 million in financing through a securities purchase agreement with Cornell Capital Partners.
Iehab J. Hawatmeh, founder and president of CirTran, said the funding agreement was based on a 5% secured debenture, due April 23, 2009 . As part of the transaction, he said CirTran paid a commitment fee of $120,000 and a structuring fee of $15,000, with net proceeds to the company of $1,365,000.
“As CirTran moves forward with our strategic business plan into the fourth quarter and fiscal 2007, we will use these funds for general corporate and working capital,” Mr. Hawatmeh said. “This will include our off-shore manufacturing business, which focuses on the direct response/sold-on-TV marketplace, for our new marketing divisions, which concentrate on that market, and in our core contract technology-based manufacturing business in Salt Lake .”
Mr. Hawatmeh said that the agreement calls for Cornell, at its option, to convert all or part of the principal amount owed under the Debenture into shares of CirTran common stock at a conversion price equal to the lowest closing bid price for the 20 trading days immediately preceding the conversion date, except as otherwise set forth in the debenture. Cornell, he said, may also convert up to $500,000 worth of the principal amount, plus accrued interest of the Debenture, in any consecutive 30-day period when the price of CirTran stock is $0.03 per share or less at the time of conversion.
“CirTran is appreciative of the continued support of the private investment community,” said Mr. Hawatmeh. “Cornell has shown faith in CirTran and our strategic plan over years, as evidenced by this debenture which comes due in 2009. Most recently, ANAHOP, another private investor, has made multiple stock purchases and entered into a forward-looking program based on warrants and the future. Our primary goal,” he said, “is to continue to work to reward our shareholders and private investors alike.”
About CirTran Corporation
Founded in 1993, CirTran Corporation (OTC BB: CIRT, www.CirTran.com) is a premier international full-service contract manufacturer. Headquartered in Salt Lake City, its ISO 9001:2000-certified, non-captive 40,000-square foot manufacturing facility is the largest in the Intermountain Region, providing “just-in-time” inventory management techniques designed to minimize an OEM's investment in component inventories, personnel and related facilities while reducing costs and ensuring speedy time-to-market. In 1998, CirTran acquired Racore Technology ( www.racore.com ), founded in 1983 and reorganized as Racore Technology Corporation in 1997. In 2004, it formed CirTran-Asia as a high-volume manufacturing arm and wholly-owned subsidiary with its principal office in ShenZhen , China . CirTran-Asia operates in three primary business segments: high-volume electronics, fitness equipment and household products manufacturing, focusing on the multi-billion dollar Direct Response Industry.
This press release contains forward-looking statements within the meaning of section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. With the exception of historical information contained herein, the matters discussed in this press release involve risk and uncertainties. Actual results could differ materially from those expressed in any forward-looking statement.
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