EpiCept intends to use the net proceeds it receives to repay a portion of the outstanding principal of its senior secured loan with Hercules Technology Growth Capital.
The remaining net proceeds will be used to meet its working capital needs and general corporate purposes. Rodman & Renshaw, a subsidiary of Rodman & Renshaw Capital Group acted as the exclusive placement agent for the placement.
According to the company, the notes will be issued as an original issue discount obligation in lieu of periodic interest payments and therefore no interest payments will be made under these notes. Accordingly, the principal amount of the notes will be $1.112 million. The notes may be converted into EpiCept common stock at $1 per share at the institutional investors’ discretion at any time.