By Sheri Kasprzak
New York, Nov. 30 - Electric City Corp. said it completed a private placement of a convertible term loan for $5 million.
The loan was issued to Laurus Master Fund, Ltd. and matures in four years.
The loan bears interest at the greater of Prime plus 200 basis points or 6.75% and is convertible into common shares at $1.16 each.
Electric City may force conversion of the loan if the company's stock averages at least $2.32 - or 200% of the conversion price - for the last 10 days of any month. If the company's stock price exceeds $1.33 - or 115% of the conversion price - Laurus will be required to convert the monthly principal and interest to common shares.
Laurus will receive warrants for 2 million shares, exercisable through Nov. 22, 2012, at $1.16 each.
Proceeds will be used for the expansion of the company's Virtual "Negawatt" Power utility systems. The rest will be used for general corporate purposes.
Laurus has the option to buy up to $5 million in additional principal of the loan.
Headquartered in Elk Grove Village, Ill., Electric City makes energy-saving technologies and building automation systems.
| Issuer: | Electric City Corp.
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| Issue: | Convertible term loan
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| Amount: | $5 million
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| Maturity: | Nov. 22, 2009
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| Coupon: | The greater of Prime plus 200 basis points or 6.75%
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| Conversion price: | $1.16
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| Call: | May force conversion if stock averages at least $2.32 for the last 10 days of any month. May also force conversion if the company's stock price exceeds $1.33
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| Warrants: | For 2 million shares
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| Warrant expiration: | Nov. 22, 2012
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| Warrant strike price: | $1.16
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| Investor: | Laurus Master Fund, Ltd.
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| Settlement date: | Nov. 23
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| Stock price: | $0.79 at close Nov. 23
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