By Laura Lutz
Des Moines, Sept. 7 - Golden Autumn Holdings, Inc. closed a private placement of secured convertible notes and warrants for $1 million.
Strategic Alliance Fund, LP and Strategic Alliance Fund II, LP were the investors.
The 8% notes mature on Aug. 31, 2008. Interest is payable when the notes are redeemed.
At any time, Golden Autumn may prepay the notes, in whole or in part, at 125% of par plus accrued interest.
When Golden Autumn completes an equity financing for at least $5.1 million, the entire principal amount of the notes plus accrued interest will automatically be converted into common stock at a 35% discount to the share price in the financing. The conversion price has a floor of $0.50.
If the financing involves a security with a conversion price that is not fixed, the noteholders will receive the same security at a 35% discount to the price paid in the financing.
If the financing is not completed by Nov. 30, the conversion discount will increase by 5% on the first day of each month up to a maximum discount of 50%.
The warrants will be exercisable for a number of shares equal to $300,000 divided by the share price in the subsequent financing, if that offering is completed by Nov. 30.
If the equity financing is not completed by Nov. 30, the warrants will be exercisable at $1.00 per share.
The warrants expire on Aug. 31, 2010.
The placement was non-brokered.
Based in Dallas, Golden Autumn develops and manages retirement communities.
| Issuer: | Golden Autumn Holdings, Inc.
|
| Issue: | Secured convertible notes
|
| Amount: | $1 million
|
| Maturity: | Aug. 31, 2008
|
| Coupon: | 8%
|
| Price: | Par
|
| Yield: | 8%
|
| Conversion price: | 35% discount to share price in subsequent equity financing for at least $5.1 million
|
| Warrants: | For a number of shares equal to $300,000 divided by the share price in the subsequent financing
|
| Warrant expiration: | Aug. 31, 2010
|
| Warrant strike price: | Share price in subsequent financing; $1.00 if that deal is not completed by Nov. 30
|
| Agent: | Non-brokered
|
| Investors: | Strategic Alliance Fund, LP and Strategic Alliance Fund II, LP
|
| Pricing date: | Aug. 31
|
| Settlement date: | Sept. 4
|
| Stock symbol: | OTCBB: GAHI
|
| Stock price: | $2.25 at close Sept. 4
|
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