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news.Stem cell preservation company Cord Blood America has completed a private placement with institutional investors of 0% senior convertible notes, at an original issue discount of 20%, in an aggregate principal amount of $1.9 million.
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In addition, it has secured a $1 million acquisition line of credit, to be used strictly for acquisition and asset purchases. The purchase price for the convertible notes consisted of $1 million cash and the cancellation of $544,000 of accrued interest currently due.
The convertible notes are junior to all outstanding debt, but will have a priority over future debt and are convertible into common stock at $0.03 per share. Pursuant to this transaction, the company also issued warrants to purchase an additional 48.2 million shares of its common stock exercisable at $0.037 per share.
Matthew Schissler, CEO of Cord Blood America, said: “We are enormously pleased by these financings as they allow for us to continue our strategic organic growth focused on exclusive relationships with approved insurance providers. The financings also allow Cord Blood America to move forward with its aggressive accretive acquisition program.”