Orange 21 Inc., which owns the Spy Optic line of sunglasses and goggles, has launched a $7.6 million rights offering pursuant to which holders of its common stock, options and warrants, will be entitled to purchase additional shares of its common stock at a price of 80 cents per share. The proceeds from the rights offering are expected to be used for general corporate purposes, which may include research and development, capital expenditures, payment of trade payables, working capital and general and administrative expenses.
In the rights offering, stockholders, option holders and warrant holders as of 5:00 p.m., New York City time January 21, 2009, will be issued, at no charge, one subscription right for each share of common stock then outstanding or subject to outstanding options or warrants (whether or not currently exercisable). Each right will entitle the holder to purchase one share of Orange 21s common stock for $0.80 per share. Orange 21 may also allocate unsubscribed shares to other investors at the price of $0.80 per share.
The rights offering will be conducted via an existing effective shelf registration statement. An aggregate of 9,544,814 subscription rights will be distributed. The subscription rights are not transferable and will be evidenced by subscription rights certificates. Fractional shares will not be issued in the rights offering. Orange 21 will mail rights offering materials, including a prospectus supplement and a subscription rights certificate, to record holders of common stock, options and warrants on or about January 22, 2009. The rights may be exercised at any time prior to 5:00 p.m. New York City time on February 20, 2009, the scheduled expiration of the offer; although, Orange 21 may extend the offering period in its discretion.