By Sheri Kasprzak
New York, Sept. 30 - Ruby Mining Co. said it has settled the $800,000 second tranche of its overall previously announced $2.5 million private placement.
In the most recent tranche, the company issued $800,000 in secured convertible notes to The NIR Group.
The 8% notes mature June 27, 2008 and are convertible into common shares at the lesser of $0.15 or a 50% discount to the average of the lowest intraday trading prices during the 20 trading days before conversion.
The interest rate drops to 0% in any month the company's stock trades at 125% of the initial market price - or $0.1625 - for each trading day in that month.
Ruby may prepay the notes as long as the company's stock is trading at or below $0.13 per share. The company may prepay the notes at 125% of the outstanding principal and interest within 30 days of issuance, at 155% of the principal and interest between 31 and 60 days of issuance and 150% of principal and interest after 60 days.
For its most recent investment, NIR received warrants for 3,076,923 shares, exercisable at $0.25 each for five years.
Laidlaw & Co. was the placement agent.
The proceeds will be used to pay current accounts payable and for continuing operations, acquisitions of capital equipment and working capital.
Ruby Mining, based in Dallas, Ga., recovers cargo from 16th, 17th and 18th century shipwrecks.
| Issuer: | Ruby Mining Co.
|
| Issue: | Convertible notes
|
| Amount: | $800,000
|
| Maturity: | June 27, 2008
|
| Coupon: | 8%
|
| Price: | Par
|
| Yield: | 8%
|
| Conversion price: | The lesser of $0.15 or the average lowest intraday trading prices during the 20 trading days before conversion, discounted by 50%
|
| Call: | May be prepaid at 125% within 30 days of issuance; 155% between 31 and 60 days of issuance and at 150% after 60 days of issuance as long as company's stock does not trade above $0.13
|
| Warrants: | For 3,076,923 shares
|
| Warrant expiration: | Five years
|
| Warrant strike price: | $0.25
|
| Placement agent: | Laidlaw & Co.
|
| Investor: | The NIR Group
|
| Settlement date: | Sept. 29
|
| Stock price: | $0.15 at close Sept. 29
|
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