By Devika Patel
Knoxville, Tenn., Aug. 4 - LightPath Technologies, Inc. said it took in $2.93 million from a private placement of 8% convertible debentures. The company had hoped to raise $5 million.
The debentures are immediately convertible into 1,901,948 common shares.
Investors also received warrants to purchase up to 950,974 common shares. The warrants are exercisable for five years, with 65% of the warrants exercisable at $1.68 per share and 35% of the warrants exercisable at $1.89.
Interest on the debentures is payable quarterly beginning on Oct. 1. The Oct. 1 interest payment was prepaid by the company on Aug. 1 by issuing common shares. The remaining interest payments may be paid in cash or in common stock.
First Montauk Securities Corp. was the placement agent.
Proceeds were to have funded the company's planned opening of a joint venture business focused on high volume low cost products with LightPath's Chinese partner, CDGM Optical Glass Co., China's largest glass manufacturer. However, the company was not able to raise the $5 million needed for that venture.
So, LightPath will now use some of the proceeds to make a modest investment in the imaging consumer market for cell phones and digital cameras. The investment will be for an optical design team, sales staff and manufacturing equipment. The personnel and equipment will all be deployed in China to continue to expand in this large emerging market opportunity in China.
LightPath is based in Orlando, Fla. and produces optical networking items for the telecommunications industry.
| Issuer: | LightPath Technologies, Inc.
|
| Issue: | Convertible debentures
|
| Amount: | $2,929,000
|
| Coupon: | 8%
|
| Price: | Par
|
| Yield: | 8%
|
| Conversion ratio: | Into 1,901,948 common shares
|
| Warrants: | For 950,974 shares
|
| Warrant expiration: | Five years
|
| Warrant strike price: | $1.68 (65% of the warrants), $1.89 (35% of the warrants)
|
| Agent: | First Montauk Securities Corp.
|
| Settlement date: | Aug. 4
|
| Stock symbol: | Nasdaq: LPTH
|
| Stock price: | $1.74 at close Aug. 1
|
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