Under the agreement signed July 14, 2005, Cornell has committed to provide up to $10 million of funding in the form of a Standby Equity Distribution Agreement or (SEDA) to be drawn down over a 24-month period at XsunX's discretion in tranches up to $250,000 each. Once a registration statement is filed by XsunX, and declared effective by the Securities and Exchange Commission (SEC), the SEDA allows XsunX to raise capital as required in amounts deemed suitable by the Company over the two-year period.
In addition, XsunX sold an aggregate of $850,000 of fixed price Secured Convertible Debentures to Cornell. The structure of the convertible allows Cornell to convert, at their option, into common shares of the Company at the fixed price of $.10. The Company received $400,000 of the debenture at the time of signing with an additional $450,000 to be advanced prior to the filing of a registration statement with the Securities and Exchange Commission (SEC) in connection with the transaction.
"Over the last year XsunX has been fortunate to have established strong relationships with partners such as MVSystems, Inc., made great strides in our product development, expanded our intellectual property assets, and now we have gained a strong partner in the area of finance," said Tom M. Djokovich, Chief Executive Officer of XsunX, Inc. "This financing provides an opportunity for XsunX to accelerate various aspects of our business plan in efforts to bring Power Glass, a new Building Integrated Photovoltaic technology, to market as soon as possible."
"The renewable energy sector has attracted growing interest from the investment community and Cornell has been looking to make an entry into this exciting new growth industry," stated Mr. David Ratzker, V.P. Corporate Finance of Cornell Capital, LP. "Our investment in XsunX provides us entry into the photovoltaics market through what we believe is an exciting approach to new uses and applications in solar technology."
Dr. Arun Madan, Chairman of the XsunX Scientific Advisory Board and founder of MVSystems, Inc. was quoted as saying, "The development of thin-film large area solar cells represents what we believe to be an important part of the expanding landscape of renewable technologies. We have developed a number of proprietary technologies in this area and with the advent of Cornell Capital's investment commitment we hope to accelerate efforts and leverage our relationship with Cornell into commercially viable products as quickly as possible."