Aspen Group, Inc. Announces Auto Conversion of $10 Million Convertible Notes Reducing Debt Balance to Zero

Rhea-AI Summary

Aspen Group, Inc. (Nasdaq: ASPU) announced that its $10 million secured convertible notes have fully converted, marking a significant milestone for the company. The notes, which carried a 7% interest rate and were convertible at $7.15 per share, were extinguished, eliminating $700,000 in annual interest expenses. This auto conversion occurred on September 14, 2020, after the company's stock price exceeded $10.725 for 20 consecutive trading days. Aspen Group is now entirely debt-free, reflecting its improving financial performance and growth strategy focused on increasing its nursing student body.

Positive

• Aspen Group is now entirely debt-free following the conversion of $10 million in secured convertible notes.
• Elimination of $700,000 in annual interest expense will improve profitability.
• The stock price appreciation suggests strong market confidence and reflects the company's growth strategy.

Negative

• None.

NEW YORK, Sept. 14, 2020 (GLOBE NEWSWIRE) -- Aspen Group, Inc. (“AGI”) (Nasdaq: ASPU), an education technology holding company, today announced that the $10 million of secured convertible notes issued by the Company on January 22, 2020 have fully converted.

The convertible notes were automatically convertible into Aspen Group common stock once the closing price of the Company’s common stock equaled or exceeded $10.725 for 20 consecutive trading days. The auto conversion occurred at the close of trading on Monday, September 14, 2020. The Company had two $5 million secured convertible notes carrying a 7% interest rate convertible at $7.15 per share. The extinguishment of the notes eliminates $700,000 of annual interest expense. Aspen Group has issued 1,398,602 shares of common stock to the two noteholders.

“This represents another important milestone in the continual strengthening of our balance sheet. Upon the full conversion of the convertible notes, Aspen Group is now entirely debt-free. This also removes $700,000 of annual interest expense from our P&L,” stated Michael Mathews, Aspen Group Chairman and CEO. “The appreciation in Aspen Group’s stock price year-to-date reflects our growth and improving financial performance, as we have successfully executed our strategy of increasing our nursing student body, particularly in the high-LTV degree programs.”

About Aspen Group, Inc.

Aspen Group, Inc. is an education technology holding company that leverages its infrastructure and expertise to allow its two universities, Aspen University and United States University, to deliver on the vision of making college affordable again. For more information, visit www.aspu.com.

Contact Information:

Hayden IR
Kimberly Rogers
(385) 831-7337
Kim@HaydenIR.com

FAQ

What happened to the secured convertible notes issued by Aspen Group (ASPU) on January 22, 2020?

The secured convertible notes have fully converted, making Aspen Group entirely debt-free.

How much annual interest expense has Aspen Group eliminated?

Aspen Group has eliminated $700,000 in annual interest expense following the conversion of the notes.

When did the auto conversion of the convertible notes occur for ASPU?

The auto conversion of the convertible notes occurred on September 14, 2020.

What was the conversion price for the secured convertible notes of Aspen Group?

The secured convertible notes were convertible at $7.15 per share.

What does the recent share conversion imply about Aspen Group's financial performance?

The conversion implies strengthening financial performance and investor confidence, as indicated by stock price growth.