30-month financing was negotiated Thursday with investor Lincoln Park
By Devika Patel
Knoxville, Tenn., Sept. 20 - ESP Resources, Inc. arranged a $5 million equity line of credit with Lincoln Park Capital Fund, LLC on Sept. 16, according to an 8-K filed Monday with the Securities and Exchange Commission.
The company will sell the common shares to Lincoln Park over 30 months in tranches of up to $500,000 at a price based on the prevailing market prices without any fixed discount.
Upon signing the agreement, Lincoln Park invested $100,000 in the company by buying 666,667 shares as an initial purchase under the agreement at $0.15 per share, along with warrants for an equivalent number of shares which are each exercisable at $0.20 per share. The strike price reflects a 42.86% premium to the Sept. 15 closing share price, $0.14.
The investor also received 1,181,102 shares as a commitment fee.
"We are pleased to have signed a purchase agreement with Lincoln Park Capital," ESP president David Dugas said in a press release. "After significant due diligence, we look forward to working with the team at Lincoln Park Capital. They have an outstanding reputation in the financial marketplace and we welcome them as an investor."
The oil and gas exploration company is based in Scott, Texas.
| Issuer: | ESP Resources, Inc.
|
| Issue: | Equity line of credit
|
| Amount: | $5 million
|
| Tenor: | 30 months
|
| Price: | No fixed discount
|
| Warrants: | For 666,667 shares
|
| Warrant strike price: | $0.20
|
| Fees: | 1,181,102 shares
|
| Investor: | Lincoln Park Capital Fund, LLC
|
| Settlement date: | Sept. 16 (for $100,000)
|
| Stock symbol: | OTCBB: ESPI
|
| Stock price: | $0.14 at close Sept. 16
|
| Market capitalization: | $8.76 million
|
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