Deal's proceeds earmarked for commercialization of Coldry technology
By Devika Patel
Knoxville, Tenn., Oct. 28 - Environmental Clean Technologies Ltd. said it plans a $2.5 million private placement of three-year zero-coupon convertible notes with La Jolla Cove Investors, Inc.
The notes will be sold in tranches of $400,000 each for the first two tranches and in tranches of $250,000 each afterward until the entire financing is completed for $2.5 million.
The notes are convertible into common stock at a price equal to the lesser of A$0.20 per share or 80% of the average of the three lowest volume-weighted average prices during the 15 trading days prior to conversion.
No interest will be charged on the convertibles unless the company's shares trade below A$0.02. Interest will accrue at 4.75% per year on each day that the shares are below the threshold.
Proceeds will be used for commercialization of the company's Coldry technology, including ongoing feasibility studies and design work for a demonstration plant, development of the Matmor technology and working capital requirements.
Environmental Clean is a clean-coal technology company based in South Melbourne, Australia.
| Issuer: | Environmental Clean Technologies Ltd.
|
| Issue: | Senior secured convertible notes
|
| Amount: | $2.5 million
|
| Maturity: | Three years
|
| Coupon: | 0% unless shares trade below A$0.02, in which case 4.75% per year
|
| Price: | Par
|
| Conversion price: | Lesser of A$0.20 or 80% of the average of the three lowest volume-weighted average prices during the 15 trading days prior to conversion
|
| Warrants: | No
|
| Investor: | La Jolla Cove Investors, Inc.
|
| Pricing date: | Oct. 28
|
| Stock symbol: | Australia: ESI
|
| Stock price: | A$0.024 at close Oct. 28
|
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