By Devika Patel
Knoxville, Tenn., May 14 - Tidelands Oil & Gas, Inc. arranged to sell $3 million of 6% convertible debentures in a private placement on May 9, according to an 8-K filed Wednesday with the Securities and Exchange Commission. The company sold a $1 million debenture in an initial tranche.
Golden Gate Investors Inc. is the investor, and paid the company $200,000 and an $800,000 promissory note.
Until Aug. 8, the company may redeem the note at a price equal to the principal and interest, provided that no event of default has occurred.
The debenture is unsecured; interest is payable monthly, with the principal amount due on May 9, 2011. It is convertible at the lesser of $0.50 or 80% of the average of the three lowest volume weighted average prices during the 20 trading days prior to Golden Gate's election to convert.
The promissory note is secured and bears interest at 6.25% per annum, payable monthly, with the principal amount also due on May 31, 2011. Golden Gate has the option to prepay this note, subject to the satisfaction of certain conditions.
Tidelands, based in San Antonio, is a provider of transportation, distribution and storage services for the oil and natural gas sector.
| Issuer: | Tidelands Oil & Gas, Inc.
|
| Issue: | Unsecured convertible debentures
|
| Amount: | $3 million
|
| Maturity: | May 9, 2011
|
| Coupon: | 6%, payable monthly
|
| Price: | Par
|
| Yield: | 6%
|
| Conversion price: | Lesser of $0.50 or 80% of the average of the three lowest volume weighted average prices during the 20 trading days prior to Golden Gate's election to convert
|
| Warrants: | No
|
| Investor: | Golden Gate Investors Inc.
|
| Settlement date: | May 9 (for $1 million)
|
| Stock symbol: | OTCBB: TIDE
|
| Stock price: | $0.04 at close May 9
|
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