Convertible preferred stock sold with warrants for 37.5 million shares
By Devika Patel
Knoxville, Tenn., Nov. 4 - FreeSeas Inc. said it plans a $10 million private placement of 0% convertible preferred stock with Crede CG III, Ltd.
The preferreds are being sold at $100.00 apiece and are convertible into common shares at $0.40 per share, which is identical to the Nov. 1 closing share price.
Crede also will receive two types warrants for a total of 37.5 million shares, with the five-year series A warrants exercisable for 25 million shares at $0.52 and the one-year series B warrants exercisable for 12.5 million shares at $0.52. The strike prices are a 30% premium to the Nov. 1 closing price.
Settlement of the initial $1.5 million tranche is expected Nov. 5.
"The agreement, which follows our recently announced elimination of approximately $30 million of indebtedness, provides the company with the capital necessary to help further strengthen its balance sheet and position itself to grow its fleet, generating future income and earnings growth," chairman, president and chief executive officer Ion G. Varouxakis said in a press release. "Most importantly, this agreement also marks the beginning of a special relationship with Crede, a leading institutional investor. We look forward with excitement at the period ahead of us."
FreeSeas Inc., based in Athens, is a transporter of dry-bulk cargoes.
| Issuer: | FreeSeas Inc.
|
| Issue: | Convertible preferred stock
|
| Amount: | $10 million
|
| Price: | $100.00
|
| Conversion price: | $0.40
|
| Dividends: | 0%
|
| Warrants: | For 37.5 million shares
|
| Warrant expiration: | Five years, one year
|
| Warrant strike price: | $0.52
|
| Investor: | Crede CG III, Ltd.
|
| Pricing date: | Nov. 4
|
| Settlement date: | Nov. 5 ($1.5 million)
|
| Stock symbol: | Nasdaq: FREE
|
| Stock price: | $0.40 at close Nov. 1
|
| Market capitalization: | $2.12 million
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
