Deal includes warrants; funds used to purchase materials for products
By Devika Patel
Knoxville, Tenn., Jan. 11 - Kingold Jewelry, Inc. said it plans a $12.6 million private placement of stock with three individuals.
The company will sell 7 million common shares at $1.80 apiece. The price per share is a 38.46% premium to the Jan. 10 closing share price of $1.30.
The investors will also receive one-year warrants for 2.8 million shares, which are each exercisable at $1.80. The strike price also represents a 38.46% premium to the Jan. 10 closing share price.
Proceeds will be used to purchase additional raw materials for products and for working capital and other general corporate purposes.
"While the terms were at a significant discount to the company's book value, the shares sold at a purchase price higher than our closing price," chairman and chief executive officer Zhihong Jia said in a press release.
Based in Wuhan, China, Kingold designs, manufactures and sells gold jewelry.
| Issuer: | Kingold Jewelry, Inc.
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| Issue: | Common shares
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| Amount: | $12.6 million
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| Shares: | 7 million
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| Price: | $1.80
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| Warrants: | For 2.8 million shares
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| Warrant expiration: | One year
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| Warrant strike price: | $1.80
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| Pricing date: | Jan. 11
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| Stock symbol: | Nasdaq: KGJI
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| Stock price: | $1.30 at close Jan. 10
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| Market capitalization: | $81.78 million
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