By Sheri Kasprzak
New York, May 14 - China Education Alliance, Inc. concluded a $2.4 million private placement of convertible notes with a group of institutional investors led by Barron Partners LP.
The notes are convertible into either 6,486,486 common shares or 6,486,486 shares of series A convertible preferred stock. The full terms of the notes were unavailable by press time Monday.
The preferreds are convertible into common shares on a one-for-one basis.
The investors, which also included Eos Holdings and Hua-Mei 21st Century Partners, LP, received warrants for 6 million shares, exercisable at $0.69 each. The investors also received warrants for 3 million shares exercisable at $0.80 each and warrants for 3 million shares exercisable at $1.00 each.
Proceeds will be used for the repayment of $1,364,578 in principal and interest on bridge notes issued in September 2006. The remainder will be used for working capital.
Based in Beijing, China Education Alliance provides online educational services, including exam preparation outside centralized high schools and vocational training for recent graduates.
| Issuer: | China Education Alliance, Inc.
|
| Issue: | Convertible notes
|
| Amount: | $2.4 million
|
| Conversion ratio: | Into either 6,486,486 common shares or 6,486,486 series A convertible preferred shares
|
| Warrants: | For 12 million shares
|
| Warrant strike price: | $0.69 for 6 million shares, $0.80 for 3 million shares, $1.00 for 3 million shares
|
| Investor: | Barron Partners LP (lead); Eos Holdings; Hua-Mei 21st Century Partners, LP
|
| Settlement date: | May 8
|
| Stock symbol: | OTCBB: CEDA
|
| Stock price: | $0.37 at close May 8
|
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