By Sheri Kasprzak
Atlanta, Nov. 12 - VCG Holding Corp. said it sold $1.25 million in convertible subordinated notes in a private placement.
The 12% notes have a two-year term and are convertible into common shares at $2 each. The notes also have detachable warrants for 312,500 shares of common stock at $3 for half of the warrants and $4 for the other half.
The shares were sold to institutional and private investors.
Some buyers obtained the right to buy an additional $1.5 million of the notes with a conversion price at a premium to the current market price.
Westminster Securities Corp. acted as placement agent in the deal.
Based in Denver, VCG is the owner, operator and consolidator of adult nightclubs. The company plans to use the proceeds from the deal to provide permanent financing for its recently acquired Diamond Cabaret in Denver.
| Issuer: | VCG Holding Corp.
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| Issue: | Convertible subordinated notes
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| Amount: | $1.25 million
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| Maturity: | Two years
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| Coupon: | 12%
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| Price: | Par
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| Yield: | 12%
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| Conversion price: | $2
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| Warrants: | For 312,500 shares
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| Warrant strike price: | $3 for one half; $4 for the other half
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| Placement agent: | Westminster Securities Corp.
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| Announcement date: | Nov. 12
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| Settlement date: | Nov. 12
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| Stock price: | $3.18 at close Nov. 12
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