By Devika Patel
Knoxville, Tenn., March 25 - DigitalFX International, Inc. amended a $7 million private placement of senior secured convertible notes and warrants that priced in November, according to an 8-K filed Tuesday with the Securities and Exchange Commission. The company now plans to sell $3 million in notes, which it will issue in exchange for the notes it originally sold to the investors.
The new convertibles, like the original notes, will mature in three years and bear interest at 7.5% per year.
The new notes will be convertible into 1.5 million shares at $2.00 per share; the original notes were convertible at $2.80 per share.
Beginning one year after closing, DigitalFX will be able to force conversion if the average of the daily volume-weighted average price of its stock is at least $2.75 for 20 consecutive trading days. Under the original agreement, the price for forced conversion was $4.90.
The investors also received new warrants for 750,002 shares, exercisable at $0.959 per share for five years, beginning on Nov. 30, 2007. These warrants were exchanged for the five-year warrants the company had issued originally, which were exercisable for 875,000 shares at $2.93.
The company will repay the investors the $4 million that they paid for the notes and warrants in November.
Settlement is expected on March 26.
Proceeds will be used for strategic initiatives and general working capital.
DigitalFX is a Las Vegas-based digital communications and social networking company.
| Issuer: | DigitalFX International, Inc.
|
| Issue: | Senior secured convertible notes
|
| Amount: | $3 million
|
| Maturity: | Three years
|
| Coupon: | 7.5%
|
| Price: | Par
|
| Yield: | 7.5%
|
| Conversion price: | $2.00
|
| Warrants: | For 750,002 shares
|
| Warrant expiration: | Five years
|
| Warrant strike price: | $0.959
|
| Pricing date: | Nov. 29
|
| Revised: | March 24
|
| Settlement date: | March 26
|
| Stock symbol: | Amex: DXN
|
| Stock price: | $2.65 at close Nov. 29
|
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