By Sheri Kasprzak
New York, March 29 - Palomar Enterprises, Inc. said it settled a $1.35 million private placement of callable secured convertible notes with four institutional investors.
The investors - New Millennium Capital Partners II, LLC, AJW Qualified Partners, LLC, AJW Offshore, Ltd. and AJW Partners, LLC - bought the 6% notes, which are due in three years and are convertible into shares at the average of the three lowest trading prices for the company's stock for the 20 trading days before conversion.
The investors also received warrants for 36 million shares, exercisable at $0.13 each for seven years.
The notes may be prepaid, assuming the company's stock trades below $0.05 per share, at 120% of principal within 30 days of issue, 130% of principal between 31 and 60 days from issue and 140% of principal of prepayments after the 60th day following issue.
Based in Carson City, Nev., Palomar is mortgage broker and auto lender.
| Issuer: | Palomar Enterprises, Inc.
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| Issue: | Callable secured convertible notes
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| Amount: | $1.35 million
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| Maturity: | Three years
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| Coupon: | 6%
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| Price: | Par
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| Yield: | 6%
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| Conversion price: | Equal to the average of the three lowest trading prices for the 20 trading days before conversion
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| Call: | May be prepaid at 120% of principal within 30 days of issue, at 130% between 31 and 60 days from issue, at 140% after 60 days from issue
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| Warrants: | For 36 million shares
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| Warrant expiration: | Seven years
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| Warrant strike price: | $0.13
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| Investors: | New Millennium Capital Partners II, LLC, AJW Qualified Partners, LLC, AJW Offshore, Ltd., AJW Partners, LLC
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| Settlement date: | March 23
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| Stock symbol: | OTCBB: PLMA
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| Stock price: | $0.04 at close March 23
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