By Sheri Kasprzak
New York, Sept. 19 - ERF Wireless Inc. said it has completed a $1.5 million convertible note offering with four institutional investors.
The company sold a $1,285,000 convertible secured note to Global Capital Funding, LP; a $50,000 convertible secured note to GCA Strategic Investment Fund Ltd.; a $75,000 convertible secured note to HIPL Family Trust and a $90,000 convertible note to DP Securities Inc.
The 6% notes mature in two years and are convertible into shares at the lesser of $3.50 each or 85% of the average of the three lowest volume-weighted average prices for the 10 trading days before notice of conversion.
Global received a warrant for 300,000 shares, GCA a warrant for 13,953 shares, HIPL a warrant for 20,930 shares and DP a warrant for 55,116 shares. The warrants are exercisable for five years at $3.57 each.
The proceeds will be used to acquire key targets in the wireless broadband industry. The rest will be used for general corporate purposes.
Based in League City, Texas, ERF is a wireless broadband products and services provider.
| Issuer: | ERF Wireless Inc.
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| Issue: | Convertible secured notes
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| Amount: | $1.5 million
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| Maturity: | Two years
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| Coupon: | 6%
|
| Price: | Par
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| Yield: | 6%
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| Conversion price: | The lesser of $3.50 or 85% of the three lowest volume-weighted average prices for the 10 trading days before notice of conversion
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| Warrants: | For 389,999 shares
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| Warrant expiration: | Five years
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| Warrant strike price: | $3.57
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| Investors: | Global Capital Funding, LP; GCA Strategic Investment Fund Ltd.; HIPL Family Trust; DP Securities Inc.
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| Settlement date: | Sept. 13
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| Stock price: | $3.75 at close Sept. 13
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