By Sheri Kasprzak
New York, March 22 - Verstaile Systems Inc. is offering up $4.5 million in three-year convertible debentures in a non-brokered PIPE.
The debentures will be sold to a U.S.-based institutional investor, and the proceeds from the offering will be used to repay promissory notes due in the current fiscal year.
The debentures bear interest at Prime rate plus 200 basis points and have an average conversion premium of 33% over the company's market price on a tiered basis with a 5% premium for one-third of the investment, a 20% premium for one-third of the investment and 75% for one-third of the investment.
The investor will receive warrants equal to 30% of the investment. The strike price is equal to an average premium of 32% to the then-current market price on a tiered basis. There is a 10% premium to the market price with a three-year term for one-third of the warrants, a 20% premium to the market price with a three-year term for one-third of the warrants and a 65% premium to market with a five-year term for one-third.
Vancouver, B.C.-based Versatile is a software developer focused on marketing and distribution products.
| Issuer: | Versatile Systems Inc.
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| Issue: | Convertible debentures
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| Amount: | $4.5 million
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| Maturity: | Three years
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| Coupon: | Prime rate plus 200 basis points
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| Conversion premium: | 33% average premium tiered in thirds with a 5% premium for one-third, a 20% premium for one-third and a 75% premium for one-third
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| Warrants: | Equal to 30% of the offering size
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| Warrant expiration: | Three years for two-thirds of the warrants, five years for one-third of the warrants
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| Warrant strike price: | 32% average premium to the then-current market price tiered over thirds with a 10% premium for one-third, a 20% premium for one-third and a 65% premium to one-third
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| Placement agent: | Non-brokered
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| Pricing date: | March 22
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| Stock symbol: | TSX Venture: VV
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| Stock price: | C$0.31 at close March 21
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