By Laura Lutz
Des Moines, Jan. 23 - Raser Technologies, Inc. and its subsidiary, Truckee Geothermal No. 1 SV-01, LLC, arranged a $44 million financing from Merrill Lynch, Pierce, Fenner & Smith Inc., according to an 8-K filing with the Securities and Exchange Commission.
Under the agreement, Wachovia will buy about $38.4 million of 15-year fully amortizing notes with an interest rate of Libor plus 500 basis points, swapped to a fixed rate of interest that will be determined at the time of funding.
The remainder of the financing will come from a letter of credit that will be required under a power purchase agreement.
Merrill Lynch also received warrants for common stock with exercise prices ranging from $14.98 to $19.71.
The warrants will vest and become exercisable in increments as funding is provided. In general, the warrants that vest earlier will have a greater number and a lower exercise price, and warrants that vest later will be fewer in number and have a higher exercise price.
Under certain circumstances, the warrants may be called for cancellation.
Additional warrants may be granted to Merrill Lynch upon funding of any of an additional 55 megawatts of geothermal power projects. Merrill Lynch has a right of first refusal on those projects.
Proceeds will be used to construct a 10.5 megawatt geothermal power plant in Nevada.
Raser is a technology licensing company based in Provo, Utah.
| Issuer: | Raser Technologies, Inc. and Truckee Geothermal No. 1 SV-01, LLC
|
| Issue: | Notes
|
| Amount: | $38.4 million
|
| Maturity: | 15 years
|
| Coupon: | Libor plus 500 basis points, swapped with fixed rate
|
| Price: | Par
|
| Warrants: | Yes
|
| Warrant strike prices: | $14.98 to $197.71
|
| Investor: | Merrill Lynch, Pierce, Fenner & Smith Inc.
|
| Settlement date: | Jan. 16
|
| Stock symbol: | OTCBB: RSTG
|
| Stock price: | $9.40 at close Nov. 2 (last trade)
|
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