By Laura Lutz
Des Moines, Sept. 19 - Downside Up, Inc. upsized its private placement of units to $2.5 million from $1 million, according to an 8-K filed with the Securities and Exchange Commission on Tuesday.
Downside Up had raised $1.05 million from 20 investors as of that filing.
The placement, which began on June 28, was also extended to Oct. 31.
The offering consists of convertible promissory note units at $25,000 per unit.
Each unit consists of one unsecured promissory note and one warrant for 25,000 shares. The warrant is exercisable at $1.00 per share for five years.
The notes bear interest at 10% per year and mature in two years. If Downside Up closes another financing for at least $5 million, the notes will be due on the closing date of that financing.
The notes are convertible into common stock at a 25% discount to the average trading price of the stock over the 10 trading days before conversion.
Downside Up said in the 8-K that it will file a registration statement for the underlying shares by Oct. 31.
Based in Shrewsbury, N.J., Downside Up is merging with ESP Resources, Inc., which provides administrative services to medical providers. Before the merger, Downside had no significant operations. Following the merger, Downside Up will change its corporate name to ESP Enterprises, Inc.
| Issuer: | Downside Up, Inc.
|
| Issue: | Units of one convertible promissory note and one warrant for 25,000 shares
|
| Amount: | $2.5 million
|
| Units: | 100
|
| Note maturity: | Two years
|
| Note coupon: | 10%
|
| Note price: | Par
|
| Note yield: | 10%
|
| Note conversion price: | 25% discount to average trading price of stock over 10 trading days before conversion
|
| Warrants: | For 25,000 shares per unit
|
| Warrant expiration: | Five years
|
| Warrant strike price: | $1.00
|
| Pricing date: | June 28
|
| Upsized: | Sept. 19
|
| Settlement date: | Oct. 31 (final)
|
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