The Series A Preferred has a liquidation value of $14,000 per share and is convertible at the holders' option into common stock at a conversion price of $1.40 per share, subject to adjustments in certain circumstances. The holders of the Series A Preferred will be entitled to a quarterly dividend payable at the rate of four and one-half percent (4.5%) per annum, payable in cash. The holders of the Series A Preferred Stock shall have full voting rights and powers equal to the voting rights and powers of the holders of common stock, voting together with the holders of common stock as one class. So long as at least twenty (20%) percent of the Series A Preferred remains outstanding, the Company shall not issue any new securities or financial instruments that rank pari pasu or senior to the Series A Preferred without the approval of at least 75% of the Series A Preferred outstanding. Beginning one year following the effective date of the registration statement to be filed for the underlying shares of common stock, the Series A Preferred shall automatically convert into the common stock of the Company at the conversion price of $1.40 per share (subject to adjustments), if the common stock trades at a price equal to or greater than $4.15 per share for twenty (20) consecutive trading days.
"Completion of this private placement puts Transmeridian on solid financial footing," commented Lorrie T. Olivier, President and Chief Executive Officer, "and will allow us to continue with our plans for accelerated development of the South Alibek field and will allow us significant flexibility in pursuing other growth opportunities in the region."
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