By Sheri Kasprzak
New York, Oct. 20 - Velocity Express Corp. said it completed a private placement of series P convertible preferred stock for $10,352,373.
The company issued 3,099,513 shares of the preferreds at $3.34 to four institutional and accredited investors.
The 8% preferreds have a term of three years and are convertible into common shares at $3.34 each.
Once a registration statement has been declared effective, Velocity Express may redeem the preferreds at 130% of the outstanding value plus dividends.
Each investor also received series A and series B warrants for up to 20% of the preferreds purchased. The warrants are exercisable at $4.00 each. The series B warrant is only exercisable if the registration statement is not declared effective within 270 days of closing.
Based in Westport, Conn., Velocity Express is a same-day postal delivery service. On Friday, its stock closed down $0.06 at $6.74.
| Issuer: | Velocity Express Corp.
|
| Issue: | Series P convertible preferred stock
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| Amount: | $10,352,373
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| Shares: | 3,099,513
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| Price: | $3.34
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| Dividends: | 8%
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| Conversion price: | $3.34
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| Warrants: | Series A and B warrants for 20% of the preferreds purchased
|
| Warrant strike price: | $4.00
|
| Settlement date: | Oct. 14
|
| Stock price: | $3.35 at close Oct. 14
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