Under the agreement, the convertible debt will mature on June 30, 2012, and will bear interest at an annual rate of 8%. The debt may be converted into GTC common stock at $0.31 per share at LFB’s discretion at any time after June 1, 2009. GTC has the right to redeem the debt on or before June 1, 2009. GTC will also issue to LFB 5-year warrants to purchase approximately 23.2 million shares of GTCB common stock at $0.31 per share. If the debt is repaid in full, LFB will have the right to require GTC to redeem the warrants for an aggregate price of $1.5 million..
This is another master stroke from Dr.Cox screwing royally of his shareholders to secure his fatcat job safely.
The convertible debt will be secured by a first lien on GTC’s intellectual property and a second lien on all of GTC’s other assets except for the restricted cash account for GE Capital. In addition, the debt will be secured by a grant of rights and licenses with respect to certain products, including GTC’s co-exclusive rights under its collaboration agreement with LFB. The convertible debt will be subordinated to the current term debt with GE Capital
Wow.. Cox doesn't want to sell the company for good money. But mortgages the whole company for peanuts. Why don't we see any lay offs? He drives me crazy..
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