The first $28 million tranche is expected to close shortly, subject to customary closing conditions. The investors will have an option to provide up to $28 million in a second tranche upon completion of certain business milestones by the company, potentially over the next 12 months. Following closing of the first tranche, the new investors will hold approximately 45% of the ordinary shares of the company.
The first tranche of $28 million will be settled by the issuance of 12.18 million new ordinary shares and the potential $2 million investment by directors would be settled by 869,565 new ordinary shares, all at $2.30 per share. The second tranche would be settled by the issuance of American depositary shares or ADSs (each representing one ordinary share) at a price equal to the lower of $2.60, and 113% of the average of the volume weighted average prices of the company’s ADSs as reported on NASDAQ for each of the 30 trading days immediately prior to the date of the closing of the second tranche.
The company intends to use the proceeds from this financing for progressing its cardiovascular and central nervous system R&D pipeline, for general corporate purposes, and the retirement of its $2.75 million convertible debentures issued in December 2007, after which the company will be debt free.