By Devika Patel
Knoxville, Tenn., Oct. 15 - TXP Corp. amended the terms of a $5.75 million private placement of 12% secured convertible debentures on Oct. 15, according to an 8-K filed Wednesday with the Securities and Exchange Commission.
The deal was conceived on May 29, and the company has amended the third tranche's settlement date to Nov. 15 from Oct. 15.
The three-year debentures are being sold in three tranches to YA Global Investments, LP. The first tranche, for $3 million, was issued on May 29. The second, $1.5 million tranche settled on July 30 and the third and final tranche will settle for $1.25 million on Nov. 15, provided the company meets certain milestones by Oct. 15.
The debentures are convertible at any time into common shares at a conversion price equal to $0.20 per share, subject to adjustment.
Beginning on Oct. 31, and each monthly anniversary thereafter until paid in full, the company must pay back the outstanding principal in installments equal to $167,777 per month, in cash or in common stock at the company's option, at a per-share price equal to the lesser of the conversion price or a 25% discount to the lowest daily volume-weighted average price of the company's common stock for the 20 trading days prior to the redemption date.
However, the redemption share component of each redemption payment is limited to 15% of the dollar value of the common stock traded over the previous 30 trading days.
Also, the company may redeem a portion or all of the debentures at a 20% redemption premium, provided that it is not in default.
YA Global also will receive five-year warrants for 17 million common shares, exercisable at $0.20, subject to adjustment. Of the warrants, YA received one for 8.87 million shares in the first tranche; it will receive a warrant for 4.43 million shares in the second tranche and one for 3.7 million shares in the third tranche.
TXP is a Richardson, Texas-based provider of pre-manufacturing services to the electronics industry.
| Issuer: | TXP Corp.
|
| Issue: | Secured convertible debentures
|
| Amount: | $5.75 million
|
| Maturity: | Three years
|
| Coupon: | 12%
|
| Price: | Par
|
| Yield: | 12%
|
| Conversion price: | $0.20
|
| Warrants: | For 17 million shares
|
| Warrant expiration: | Five years
|
| Warrant strike price: | $0.20
|
| Investor: | YA Global Investments, LP
|
| Pricing date: | May 29
|
| Amended: | Oct. 15
|
| Settlement date: | May 29 (for $3 million), July 30 (for $1.5 million), Nov. 15 (for $1.25 million)
|
| Stock symbol: | OTCBB: TXPO
|
| Stock price: | $0.24 at close May 29
|
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