Technology company, MagneGas, Corp. (NASDAQ:MNGA), has entered into an agreement with a single institutional investor for a placement of $3 million.
MagneGas Corporation (“MagneGas” or the “Company”) (MNGA), a technology company that counts among its inventions a patented process that converts renewable and liquid waste into MagneGas2® fuel, announced today that on November 16, 2016, it entered into an agreement with a single institutional investor for a registered direct placement of approximately $3 million. The Securities Purchase Agreement provides for the sale of $2.5 million of pre-funded warrants which warrants are exercisable into 5,102,041 shares and $500,000 in payment for 1,020,408 shares.
The investor and the Company also agreed to amend the following warrants issued as part of a June 2016 financing: an E-4 common stock purchase warrant is now exercisable at $0.66 ($0.01 above the closing market price) for the investor to purchase up to an additional $4.6 million of common stock and is now exercisable 6 months from the closing of this transaction and now has a term of 7 years; an E-5 common stock purchase warrant to purchase 3,508,772 shares of common stock is now exercisable at $0.90 (approximately 38% premium to the closing market price); and an E-6 common stock purchase warrant to purchase 1,754,386 shares of common stock is also now exercisable at $0.90. The Series E-5 and E-6 common stock purchase warrants vest ratably only upon the exercise of the E-4 common stock purchase warrant.
The placement is expected to close on or before November 18, 2016, subject to satisfaction of customary closing conditions.
The pre-paid warrants and common stock are being offered and the E-4 warrants are being amended pursuant to a shelf registration statement (File No. 333-207928), which was declared effective by the United States Securities and Exchange Commission (“SEC”) on June 15, 2016.
The E-5 and E-6 warrants are being amended pursuant to a resale registration statement (File No. 333-212879), which was declared effective by the SEC on August 12, 2016.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
About MagneGas Corporation
MagneGas® Corporation (MNGA) owns a patented process that converts various renewables and liquid wastes into MagneGas fuels. These fuels can be used as an alternative to natural gas or for metal cutting. The Company’s testing has shown that its metal cutting fuel “MagneGas2®” is faster, cleaner and more productive than other alternatives on the market. It is also cost effective and safe to use with little changeover costs. The Company currently sells MagneGas2® into the metal working market as a replacement to acetylene.
The Company also sells equipment for the sterilization of bio-contaminated liquid waste for various industrial and agricultural markets. In addition, the Company is developing a variety of ancillary uses for MagneGas® fuels utilizing its high flame temperature for co-combustion of hydrocarbon fuels and other advanced applications. For more information on MagneGas®, please visit the Company’s website at http://www.MagneGas.com.
The Company distributes MagneGas2® through Independent Distributors in the U.S and through its wholly owned distributor, ESSI (Equipment Sales and Services, Inc.). ESSI has four locations in Florida and distributes MagneGas2®, industrial gases and welding supplies. For more information on ESSI, please visit the company’s website at http://www.weldingsupplytampa.com.
MagneGas, Corp. (NASDAQ:MNGA) shares are moving -18.308% on the news today and have traded in the range of $0.531 – 0.670 during the current trading session. A number of brokerage analysts have recently weighed in on the stock, providing price target projections. The covering firms currently have a consensus one-year price target of $3.000 on the stock. This is according to brokerage analysts polled by Thomson Reuters First Call. This is the average number from the individual targets provided by the firms. Analysts are projecting earnings per share of $0.000 for the next fiscal quarter. For the current year, analysts are predicting earnings of $-0.230 per share according to First Call.
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In looking at where MagneGas, Corp. (NASDAQ:MNGA) is trading on a technical level, the stock is trading -21.463% away from its 50-day moving average of $0.676. Based on the most recent available data, the equity is -78.760% off of its 52-week high of $2.500 and +0.189% away from its 52-week low which is $0.530.
Today, the stock opened at $0.650 and the last bid at the time of writing stood at $0.531. During the session thus far, the equity dipped down to $0.531 and touched $0.670 as the high point. MagneGas, Corp. (NASDAQ:MNGA) has a market cap of $26.95M and has seen an average daily volume of 522,891 over the past three months.
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Disclaimer: The views, opinions, and information expressed in this article are those of the authors and do not necessarily reflect the official policy or position of any company stakeholders, financial professionals, or analysts. Examples of analysis performed within this article are only examples. They should not be utilized to make stock portfolio or financial decisions as they are based only on limited and open source information. Assumptions made within the analysis are not reflective of the position of any analysts or financial professionals.