By Sheri Kasprzak
New York, Feb. 14 - Homeland Security Capital Corp. said it concluded a private placement of a $4 million convertible debenture with Cornell Capital Partners, LP.
The 5% debenture matures in three years and is convertible into shares at the lesser of a penny or a 10% discount to the lowest daily volume weighted average price for the 30 trading days before conversion.
Assuming the company's stock trades below the conversion, Homeland may redeem the debenture at a 20% premium to the amount being redeemed.
Also, the company said it exchanged 1 million shares of series G convertible preferred stock for 450 million of its own shares held by Cornell. The series G shares have a liquidation preference of $0.10 plus dividends.
Each preferred is convertible into 450 common shares.
Based in Arlington, Va., Homeland Security Capital invests in homeland security companies.
| Issuer: | Homeland Security Capital Corp.
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| Issue: | Convertible debenture
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| Amount: | $4 million
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| Maturity: | Three years
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| Coupon: | 5%
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| Price: | Par
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| Yield: | 5%
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| Conversion price: | The lesser of $0.01 or a 10% discount to the lowest daily VWAP for the 30 trading days before conversion
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| Call: | Redeemable at a 20% premium to principal being redeemed, assuming stock trades below conversion price
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| Warrants: | No
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| Investor: | Cornell Capital Partners, LP
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| Settlement date: | Feb. 6
|
| Announcement date: | Feb. 14
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| Stock symbol: | OTCBB: HMSC
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| Stock price: | $0.0026 at close Feb. 14
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