Deal includes five-year warrants and 12% convertible promissory notes
By Devika Patel
Knoxville, Tenn., Sept. 2 – Ener-Core, Inc. settled a $1.25 million private placement of units on Sept. 1, according to an 8-K filed Friday with the Securities and Exchange Commission.
The company sold 1,250 units of a $1,000 12% unsecured convertible promissory note and 100 warrants at $1,000 per unit.
The notes are due on Sept. 1, 2017 and are convertible into common stock at $4.31 per share. There is an automatic conversion feature that takes effect if more than 50% of the notes are converted into equity. The warrants are each exercisable at $4.00 for five years.
The conversion price and warrant strike price are 39.03% and 29.03% premiums to the Aug. 31 closing share price of $3.10.
Proceeds will be used for working capital and general corporate purposes.
The Irvine, Calif., company designs and manufactures systems for producing continuous energy from a range of sources, including previously unusable ultra-low quality gas.
| Issuer: | Ener-Core, Inc.
|
| Issue: | Units of a $1,000 unsecured convertible promissory note and 100 warrants
|
| Amount: | $1.25 million
|
| Units: | 1,250
|
| Price: | $1,000
|
| Coupon: | 12%
|
| Maturity: | Sept. 1, 2017
|
| Conversion price: | $4.31
|
| Call: | Yes
|
| Warrants: | 100 warrants per unit
|
| Warrant expiration: | Five years
|
| Warrant strike price: | $4.00
|
| Settlement date: | Sept. 1
|
| Stock symbol: | OTCBB: ENCR
|
| Stock price: | $3.10 at close Aug. 31
|
| Market capitalization: | $11.77 million
|
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