Investors also receive 20% warrant coverage; notes convert at $0.16
By Devika Patel
Knoxville, Tenn., March 17 - Lustros Inc. said it will conduct a $1.4 million private placement of 5% convertible promissory notes.
Each note is due in two years and is initially convertible into common shares at $0.16 per share, which represents a 45.46% premium to $0.11, the March 14 closing share price.
Investors also will receive 20% warrant coverage. Each of the warrants is exercisable at $0.25, a 127.27% premium to the March 14 closing price.
Proceeds will be used for operating expenses at the company's copper sulfate processing plant in Chile.
"Our copper sulfate processing plant is now in operation. This financing commitment allows us to fund the purchase of raw materials and to cover overhead and other operating expenses in preparation of our first full production orders anticipated to be shipped in May of this year," chief executive officer Bill Farley said in a press release. "The continued financial support from our board and management is commendable and demonstrates our commitment to our business plan."
The San Luis Obispo, Calif., company manufactures, markets and sells electricity-saving devices, renewable energy devices and photovoltaic electricity systems.
| Issuer: | Lustros Inc.
|
| Issue: | Convertible promissory notes
|
| Amount: | $1.4 million
|
| Maturity: | Two years
|
| Coupon: | 5%
|
| Conversion price: | $0.16
|
| Warrants: | 20% coverage
|
| Warrant strike price: | $0.25
|
| Pricing date: | March 17
|
| Stock symbol: | OTCBB: LSTS
|
| Stock price: | $0.11 at close March 14
|
| Market capitalization: | $9.18 million
|
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