Deal sells preferreds and warrants to fund general corporate purposes
By Devika Patel
Knoxville, Tenn., Aug. 22 - Red Mountain Resources, Inc. priced a $5.12 million public offering of preferred units, according to a prospectus supplement filed Thursday with the Securities and Exchange Commission.
The company will sell 227,777 preferred units of one 10% series A cumulative redeemable preferred share and one warrant for 25 shares at $22.50 per unit. The preferreds will be redeemed on July 15, 2018 at $25.00 per preferred.
Each three-year warrant is exercisable at $1.00. The strike price is a 35.14% premium to the Aug. 21 closing share price of $0.74.
Global Hunter Securities, the bookrunning manager, is conducting the sale on a best-efforts basis.
Settlement is expected Aug. 27.
Proceeds will be used for general corporate purposes, including funding a portion of the company's fiscal 2014 drilling and development program.
Red Mountain is a Dallas-based oil and gas company.
| Issuer: | Red Mountain Resources, Inc.
|
| Issue: | Units of one series A cumulative redeemable preferred share and one warrant for 25 shares
|
| Amount: | $5,124,983
|
| Units: | 227,777
|
| Price: | $22.50
|
| Dividends: | 10%
|
| Call: | On July 15, 2018 at $25.00 per preferred
|
| Warrants: | One warrant for 25 shares per unit
|
| Warrant expiration: | Three years
|
| Warrant strike price: | $1.00
|
| Bookrunner: | Global Hunter Securities
|
| Lead managing underwriter: | Wunderlich Securities
|
| Co-managers: | Euro Pacific Capital Inc., National Securities Corp., Northland Capital Markets and R. M. Duncan Securities
|
| Pricing date: | Aug. 22
|
| Settlement date: | Aug. 27
|
| Stock symbol: | OTCBB: RDMP
|
| Stock price: | $0.74 at close Aug. 21
|
| Market capitalization: | $82.04 million
|
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