Floorless Alert:
I have become interested in BCAM and have become very interested in the potential. Unfortunately, during my DD I just discovered the existence of floorless convertibles in their financing. Any comments? Scares me....
CHARGES TO OPERATIONS RELATED TO RECENT FINANCINGS. On July 24, 1997 a
subsidiary of the Company (BCA Services, Inc.) completed the first tranche for
$500,000 and on September 8, 1997 completed the second tranche for $500,000, of
a potential aggregate $1,500,000 private offering of its Preferred Stock to
accredited. The shares of Preferred Stock are convertible into the Company's
Common Stock ("Common Stock") at a price equal to 70% of the average closing bid
price of the Common Stock over a three day trading period ending on the day
preceding the conversion date (the "Variable Conversion Price"). The Conversion
Price may not be greater than 100% of the Variable Conversion Price on the first
closing date (the "Fixed Conversion Price"). The Fixed Conversion Price is
$0.6563. On the first anniversary of the closing date, all outstanding shares of
Preferred Stock must be converted into shares of Common Stock of the Company. In
addition, for each 50 shares of Preferred Stock sold, each purchaser received
warrants to purchase up to 25,000 shares of Common Stock per $500,000 raised,
exercisable at a rate of 110% of the Variable Conversion Price on the closing
date. The warrants have a term of five years and the Common Stock underlying the
warrants contain registration rights.
On September 17, 1997, BCA Services, Inc. completed a separate private
placement of $200,000 of Preferred Stock on similar terms as the $1,500,000
financing referred to above, with the exception that the Fixed Conversion Price
for these shares is $.9331 per share. In addition, the purchasers received
warrants to purchase, in the aggregate, up to 10,000 shares of Common Stock,
exercisable at a rate of 110% of the Variable Conversion Price on the closing
date. The warrants have a term of five years and the Common Stock underlying the
warrants contain registration rights |
