By Sheri Kasprzak
Atlanta, April 20 - Falcon Natural Gas Corp. said it has cancelled an $11 million equity line it entered into with Cornell Capital Partners LP in November 2004 and has received a $20 million equity line in its place.
The new standby equity distribution agreement allows Falcon to sell shares to Cornell at 100% of the lowest volume weighted average price for five days after a drawdown notice.
There is a $750,000 weekly limit on each draw.
The company has also issued Cornell $1 million in convertible debentures following the termination of the original equity line.
The debentures mature in two years, bear interest at 5% annually and are convertible into common shares at $0.60 each.
Cornell will also receive warrants for 1 million shares, exercisable at $0.60 each through April 19, 2007.
Based in Houston, Falcon is a natural gas exploration company.
Equity
| Issuer: | Falcon Natural Gas Corp.
|
| Issue: | Standby equity distribution agreement
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| Amount: | $20 million
|
| Price: | 100% of the lowest volume weighted average price five days after notice
|
| Warrants: | No
|
| Investor: | Cornell Capital Partners LP
|
| Settlement date: | April 19
|
| Stock price: | $0.48 at close April 19
|
|
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| Convertibles
|
| Issuer: | Falcon Natural Gas Corp.
|
| Issue: | Convertible debentures
|
| Amount: | $1 million
|
| Maturity: | Two years
|
| Coupon: | 5%
|
| Price: | Par
|
| Yield: | 5%
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| Conversion price: | $0.60
|
| Warrants: | For 1 million shares
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| Warrant expiration: | April 19, 2007
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| Warrant strike price: | $0.60
|
| Investor: | Cornell Capital Partners LP
|
| Settlement date: | April 19
|
| Stock price: | $0.48 at close April 19
|
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