News - $4mm Lehman Financing
Chromatics Receives Additional $4 Million In Equity Financing from Lehman Brothers Group Inc.
NEW YORK, Feb. 25 /PRNewswire/ -- Chromatics Color Sciences International, Inc. (Nasdaq: CCSI) announced today that it has received an additional $4 million in equity financing from Lehman Brothers Group Inc. ("LBI Group Inc.")as part of an equity investment in CCSI by LBI Group Inc. of $8 million. The Company had received the initial equity investment of $4 million from LBI Group Inc. in June, 1999.
The second transaction involved the private placement of convertible preferred stock and warrants, with Lehman Brothers Group Inc. as the holder. It provides for the issuance by the Company of 40,000 shares of a newly-authorized series of preferred stock, designated as Class B Series 3 at a purchase price of $100 per share.
The convertible preferred stock is convertible at the option of the holder into shares of common stock at a conversion price per share which was negotiated to be at a 10% discount to market of the five day average closing bid price of CCSI's common stock prior to the second closing, which was $6.29 per share, subject to antidilution provisions.
The convertible preferred stock is redeemable, if not sooner converted, at $115 per share on the third anniversary of the issue date, subject to the Company's right to extend the redemption date to the fifth anniversary of the issue date. The convertible preferred stock is also convertible, under conversion elected by the Company, after the six-month anniversary of the issue date in the event that the market price of the Company's common stock is equal to or greater than 150 percent of the conversion price per share for 10 consecutive trading days and the underlying common shares issuable upon conversion have been registered for resale with the Securities and Exchange Commission.
The holder of the Class B Series 3 preferred stock also will receive five-year warrants to purchase 6.3593 shares of the Company's common stock for each share of convertible preferred stock purchased at an exercise price of $6.99 per share, subject to adjustment similar to that of the Class B Series 3 preferred stock The Company may also compel involuntary exercise of the warrants after six months in the event that the market price of the Company's common stock is equal to or greater than 200 percent of the warrant exercise price per share for 20 consecutive trading days and the underlying common stock shares issuable upon exercise of the warrants have been registered.
The Company's CEO, Darby Macfarlane, said, "As we continue to move forward in executing our long-term business strategy, we are pleased to have the continued financial backing of Lehman Brothers Group Inc.. We have been pleased with the initial marketing success of our ColorMate(R) TLc-BiliTest(R) System to U.S. hospitals, and we are very excited about the potential for this product line. We also continue to work on other medical and non-medical applications for our patented color science technology."
Chromatics Color Sciences is in the business of color science.....
Certain of the matters discussed in this announcement contain forward-looking statements..... |
