ANNAPOLIS, Md., July 31 /PRNewswire-FirstCall/ -- PharmAthene, Inc. (NYSE Amex: PIP), a biodefense company developing medical countermeasures against biological and chemical threats, today announced that, effective July 28, 2009, it has closed on the issuance of 2-year, 10% unsecured senior convertible notes ("Notes") and common stock purchase warrants ("Warrants") in a private placement of approximately $19.3 million.
In connection with the private placement, the Company has received gross cash proceeds of approximately $10.5 million from new investors, including an aggregate of approximately $8.5 million from unaffiliated investors, and has exchanged approximately $8.8 million in outstanding principal and unpaid accrued interest under the Company's 8% senior unsecured convertible notes originally issued in August 3, 2007 and due August 3, 2009 (the "Old Notes").
Cash proceeds from the sale of the Notes and Warrants will be used (i) to repay approximately $5.7 million in principal and unpaid accrued interest due to holders of the Old Notes that have not elected to participate in this financing transaction, (ii) to repay all remaining amounts (approximately $2.7 million), including certain prepayment fees, due and owing under the Company's outstanding secured credit facility, and (iii) for other working capital purposes. The Company estimates that at its currently projected rate of net cash consumption, the net proceeds from this financing along with existing sources of cash will be sufficient to fund operations through the end of 2010.
Interest on the Notes will accrue at a rate of ten percent (10%) per year. The Notes are convertible by the holders thereof at any time into shares of PharmAthene's common stock at a conversion price of $2.541667/share, which represents the closin
|SOURCE PharmAthene, Inc.|
Copyright©2009 PR Newswire.
All rights reserved