Discounted 5% notes sold with 1.35 million warrants and common shares
By Devika Patel
Knoxville, Tenn., Sept. 2 – Innovus Pharmaceuticals, Inc. raised $500,000 in the second tranche of a $1.5 million private placement of convertible promissory notes on Aug. 27, according to an 8-K filed Wednesday with the Securities and Exchange Commission. The deal priced on July 15 and July 28 and raised $500,000 on Aug. 3.
The $500,000 of first-tranche notes and $550,000 of second-tranche notes were sold at a 10% original issue discount, and each tranche of notes included 750,000 common shares and warrant coverage.
The 5% notes are due on Aug. 15, 2016 and Aug. 28, 2016. They convert to common stock at $0.30 per share. The conversion price is an 87.5% premium to $0.16, the July 14 closing share price. The notes may be prepaid at 115.
The investors also will receive warrants for 1.35 million shares, with warrants for 500,000 shares issued in each of the first and second tranches. Each five-year warrant is exercisable at $0.30, also an 87.5% premium to the July 14 closing share price.
Proceeds will be used for general working capital purposes.
The pharmaceutical company is based in Sierra Madre, Calif.
| Issuer: | Innovus Pharmaceuticals, Inc.
|
| Issue: | Convertible promissory notes, 1.5 million common shares
|
| Amount: | $1.5 million
|
| Maturity: | Aug. 15, 2016, Aug. 28, 2016
|
| Price: | 10% original issue discount ($1.35 million)
|
| Coupon: | 5%
|
| Conversion premium: | 87.5%
|
| Conversion price: | $0.30
|
| Call: | At 115
|
| Warrants: | For 1.35 million shares
|
| Warrant expiration: | Five years
|
| Warrant strike price: | $0.30
|
| Investors: | Vista Capital Investments, LLC and Lynnette Dillen
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| Pricing dates: | July 15 and July 28
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| Settlement dates: | Aug. 3 (for $500,000), Aug. 27 (for $500,000)
|
| Stock symbol: | OTCBB: INNV
|
| Stock price: | $0.16 at close July 14
|
| Market capitalization: | $4.41 million
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