Purchase will give investor 73% of company on as-converted basis
By Angela McDaniels
Tacoma, Wash., Sept. 17 - Nexxus Lighting, Inc. said it agreed to sell $6 million of series B convertible preferred stock to RVL 1, LLC, an affiliate of Aston Capital, LLC.
The company entered into the agreement on Sept. 12 and expects it to close on Sept. 24, according to an 8-K filing with the Securities and Exchange Commission.
The preferreds will be convertible into common stock at a conversion price of $0.13 per common share. This is equal to the company's closing share price on Aug. 2, the date the company and the investor entered into the letter of intent about the placement.
The preferreds will represent about 73% of the outstanding voting stock of the company on an as-converted basis. At the investor's request, the company agreed to seek stockholder approval to increase the number of authorized shares of common stock to 120 million from 40 million and execute a reverse stock split.
The holders of $2.5 million of promissory notes due June 2013 have agreed to exchange their notes for $880,000 of cash and 1 million newly issued shares of common stock. The company will use proceeds of the placement to fund this $880,000 cash payment.
Proceeds will also be used for working capital purposes and to fund a payment the company expects to make to settle a lawsuit brought against it by Koninklijke Philips Electronics NV. The lawsuit alleges that some of the company's products infringe some of Philips' patents for LED lighting. The company is negotiating a settlement agreement with Philips and expects to receive a license to use some of that company's patents in exchange for royalty payments.
Nexxus makes LED lighting and is based in Charlotte, N.C.
| Issuer: | Nexxus Lighting, Inc.
|
| Issue: | Series B convertible preferred stock
|
| Amount: | $6 million
|
| Shares: | 600,000
|
| Price: | $10.00
|
| Conversion price: | $0.13
|
| Warrants: | No
|
| Investor: | RVL 1, LLC
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| Agreement date: | Sept. 12
|
| Settlement date: | Sept. 24
|
| Stock symbol: | Nasdaq: NEXS
|
| Stock price: | $0.32 at close Sept. 17
|
| Market capitalization: | $5.1 million
|
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