Investor receives three-year warrants for 2 million shares
By Angela McDaniels
Tacoma, Wash., Aug. 19 - Location Based Technologies, Inc. sold a $1 million 10% secured convertible promissory note to a high-net-worth investor on Aug. 13.
The note has a term of 24 months and is convertible into common stock at $0.20 per share, according to an 8-K filing with the Securities and Exchange Commission.
Additionally, the investor received three-year warrants to purchase 2 million shares at $0.20 per share.
The conversion and warrant strike prices are a 72.41% premium to the company's $0.116 closing share price on Aug. 12.
The note will settle in two tranches: $400 million on Aug. 15 and $600,000 by Sept. 30.
The note is senior secured against all of the company's unencumbered assets and has a second and/or third security position against all of the company's encumbered assets. The company also granted the same security for all of the outstanding unsecured convertible notes held by the investor.
The maturity date of the $1.1 million of outstanding unsecured convertibles notes held by the investor was extended to Sept. 30, 2015.
The Irvine, Calif.-based company designs and develops assisted-GPS location devices and customizable services that enable businesses and consumers to locate things.
| Issuer: | Location Based Technologies, Inc.
|
| Issue: | Secured convertible promissory note
|
| Amount: | $1 million
|
| Maturity: | Two years
|
| Coupon: | 10%
|
| Conversion price: | $0.20
|
| Warrants: | For 2 million shares
|
| Warrant expiration: | Three years
|
| Warrant strike price: | $0.20
|
| Agent: | Non-brokered
|
| Pricing date: | Aug. 13
|
| Settlement dates: | Aug. 15 for $400 million and by Sept. 30 for $600,000
|
| Stock symbol: | OTCBB: LBAS
|
| Stock price: | $0.1225 at close Aug. 19
|
| Market capitalization: | $25.68 million
|
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