Company sells senior convertibles with warrants for 10,526,316 shares
By Devika Patel
Knoxville, Tenn., June 27 – MagneGas Corp. said it will sell $1 million of senior convertible debentures with $3 million of prefunded seven-year warrants in a registered direct placement and private placement with a $6.6 million greenshoe of stock and warrants.
The debenture is convertible into 1,754,386 common shares.
The investor also will prefund a series E-1 warrant for 3,508,772 shares; a series E-2 warrant for 1,754,386 shares; an unvested series E-5 warrant for 3,508,772 shares; and an unvested series E-6 warrant for 1,754,386 shares. The series E-1 and E-5 warrants are exercisable at $1.05, and the series E-2 and E-6 warrants are exercisable at $1.30. The strike prices are 47.89% and 83.1% premiums to the June 24 closing share price of $0.71.
The greenshoe is comprised of an additional $6.6 million of common stock and warrants at $1.01 per share.
Settlement is expected June 29.
Tampa, Fla.-based MagneGas produces a natural-gas alternative and metal-working fuel made from liquid waste such as sewage.
| Issuer: | MagneGas Corp.
|
| Issue: | Senior convertible debenture
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| Amount: | $4 million
|
| Greenshoe: | $6.6 million of common stock and warrants at $1.01 per share
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| Conversion ratio: | Into 1,754,386 common shares
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| Warrants: | For 10,526,316 shares
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| Warrant expiration: | Seven years
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| Warrant strike price: | $1.05, $1.30
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| Pricing date: | June 27
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| Settlement date: | June 29
|
| Stock symbol: | Nasdaq: MNGA
|
| Stock price: | $0.71 at close June 24
|
| Market capitalization: | $31.41 million
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