Advertisement
YOU ARE HERE: LAT HomeCollections

CALIFORNIA / News and Insight on Business in the Golden
State

Spotlight: Aura Systems Shells Out 43% Interest on Loan

June 19, 1998

El Segundo-based Aura Systems Inc., a money-losing maker of audio speakers, is paying 43% interest on a $15-million loan that comes due in September, according to regulatory filings. Aura has $31 million in loans due by Feb. 28. Documents show it had $6.1 million available to repay the loans. Since Aura went public in 1986, it's lost about $84 million. The loan began with an 8% interest rate. Then the unidentified lenders negotiated an increase to 18%, along with a $935,000 quarterly fee. That pushed the rate to 43%.

For the Record
Los Angeles Times Saturday June 20, 1998 Home Edition Business Part D Page 3 Financial Desk 4 inches; 114 words Type of Material: Correction
Aura Systems--An item in Friday's Business section failed to explain the details surrounding Aura Systems Inc.'s $15-million loan on which the company is paying 43% interest. The loan, which comes due in September and which dates from March 1997, started as a convertible debenture with an interest rate of 8%. In October, the unidentified lenders negotiated an increase in the coupon rate to 18%. That pushed the total annual rate to 43%. The debenture's maturity was also shortened from March 2000 to September 1998 and its conversion feature eliminated. As security for the loan, Aura put up 1.25 million shares of Newcom Inc. and the right to receive $17 million it loaned to Newcom. That loan is part of a total $19.4 million loaned to Newcom by Aura at 9% that comes due in September. Aura Systems owns 69% of Newcom.

Advertisement
Los Angeles Times Articles
|
|
|