Company sells 5% discounted convertible notes with five-year warrants
By Devika Patel
Knoxville, Tenn., July 2 – Medican Enterprises Inc. sold $1.5 million of 5% convertible notes for $1 million in a private placement on June 25, according to an 8-K filed Wednesday with the Securities and Exchange Commission.
The note matures in one year and is initially convertible into common shares at the lesser of $1.90 and 70% of the average of the two lowest volume-weighted-average-prices of the stock during the 12 consecutive trading days preceding the conversion date. The note may be prepaid at 125.
The lone investor also received warrants for 297,832 shares, which are each exercisable at $2.15 for five years. The strike price is a 25% premium to the June 24 closing share price of $1.72.
The shell company is based in Las Vegas.
| Issuer: | Medican Enterprises Inc.
|
| Issue: | Original issue discount convertible note
|
| Amount: | $1.5 million
|
| Maturity: | One year
|
| Coupon: | 5%
|
| Price: | $1 million
|
| Conversion price: | The lesser of $1.90 and 70% of the average of the two lowest volume-weighted-average-prices of the stock during the 12 consecutive trading days preceding the conversion date
|
| Call: | At 125
|
| Warrants: | For 297,832 shares
|
| Warrant expiration: | Five year
|
| Warrant strike price: | $2.15
|
| Settlement date: | June 25
|
| Stock symbol: | OTCBB: MDCN
|
| Stock price: | $1.72 at close June 24
|
| Market capitalization: | $73.25 million
|
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