Six-month note convertible into common stock at 55% discount
By Toni Weeks
San Luis Obispo, Calif., Aug. 29 – Red Giant Entertainment, Inc. issued a $50,000 22% convertible note to JSJ Investments, Inc. on Aug. 20, according to an 8-K filing with the Securities and Exchange Commission.
The note matures Feb. 20, 2015 at a premium of 150% of the principal amount upon approval of JSJ, with the principal amount payable on demand. If the company fails to repay the note at maturity, the interest rate will remain at 22%. The note may not be prepaid.
The note is convertible into common stock at a conversion price equal to 55% of the average of the three lowest trading prices in (i) the 20 trading days immediately preceding the conversion date or (ii) the 10 trading days prior to settlement.
Clermont, Fla.-based Red Giant is an intellectual property development company that intends to develop content for itself and for use on the internet and on various multiple media platforms.
| Issuer: | Red Giant Entertainment, Inc.
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| Issue: | Convertible note
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| Amount: | $50,000
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| Maturity: | Feb. 20, 2015
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| Coupon: | 22%
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| Conversion price: | 55% of average of three lowest trading prices in (i) the 20 trading days immediately preceding the conversion date or (ii) the 10 trading days prior to settlement
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| Warrants: | No
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| Call: | No
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| Investor: | JSJ Investments, Inc.
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| Pricing date: | Aug. 20
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| Stock symbol: | OTCBB: REDG
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| Stock price: | $0.0015 at close Aug. 19
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| Market capitalization: | $3.04 million
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