Company offers 11% convertible notes along with 35% warrant coverage
By Devika Patel
Knoxville, Tenn., Oct. 14 – Marathon Patent Group, Inc. completed a $5.5 million private placement of 11% convertible notes on Oct. 9, according to an 8-K filed Tuesday with the Securities and Exchange Commission.
The notes, which mature in four years, are initially convertible into common stock at $15.00 per share, a 5.12% premium to the Oct. 8 closing share price of $14.27. The notes are subject to mandatory conversion.
Investors also received 35% warrant coverage, or warrants for 128,333 shares. Each of the warrants is exercisable at $16.50 for two years. The strike price is a 15.63% premium to the Oct. 8 closing price.
The company also said it negotiated an interest sale agreement with MedTech Development, LLC in which it agreed to acquire MedTech subsidiaries OrthoPhoenix, LLC, TLIF, LLC and MedTech Development Deutschland GmbH for $10 million in cash.
Marathon is an intellectual property consulting company based in Los Angeles.
| Issuer: | Marathon Patent Group, Inc.
|
| Issue: | Convertible notes
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| Amount: | $5.5 million
|
| Maturity: | Four years
|
| Coupon: | 11%
|
| Conversion price: | $15.00
|
| Call: | Yes
|
| Warrants: | 35% coverage (warrants for 128,333 shares)
|
| Warrant expiration: | Two years
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| Warrant strike price: | $16.50
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| Settlement date: | Oct. 9
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| Stock symbol: | Nasdaq: MARA
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| Stock price: | $14.27 at close Oct. 8
|
| Market capitalization: | $74.7 million
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