Investors also receive 100% warrant coverage; notes convert at $0.11
By Devika Patel
Knoxville, Tenn., March 5 - Cambridge Heart, Inc. raised $440,000 in the second tranche of a $2.94 million private placement of 8% secured convertible promissory notes on Jan. 17, according to an 8-K filed Wednesday with the Securities and Exchange Commission. The deal raised $2.5 million on Jan. 17.
Each note is due in 18 months and is initially convertible into common shares at $0.11 per share, which represents an 8.33% discount to $0.12, the Jan. 13 closing share price. The notes may be put, or the company may force conversion under certain conditions.
Investors also received 100% warrant coverage. Each of the warrants is exercisable at $0.15 until Jan. 17, 2016. The strike price is a 25% premium to the Jan. 13 closing price.
The placement included the conversion of $600,000 of the company's senior unsecured promissory notes. Investors included chairman Roderick de Greef, and the company may sell an additional $1.5 million of notes before Feb. 28.
Based in Bedford, Mass., Cambridge Heart develops noninvasive diagnostic tools for cardiac arrest and ventricular arrhythmia.
Issuer: | Cambridge Heart, Inc.
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Issue: | Secured convertible promissory notes
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Amount: | $2.94 million
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Maturity: | 18 months
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Coupon: | 8%
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Conversion price: | $0.11
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Call: | Yes
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Put: | Yes
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Warrants: | 100% coverage
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Warrant expiration: | Jan. 17, 2016
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Warrant strike price: | $0.15
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Investors: | Roderick de Greef
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Settlement date: | Jan. 17 (for $2.5 million), Feb. 28 (for $440,000)
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Stock symbol: | OTCBB: CAMH
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Stock price: | $0.12 at close Jan. 17
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Market capitalization: | $8.67 million
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