By Devika Patel
Knoxville, Tenn., Oct. 3 - Akesis Pharmaceuticals, Inc. negotiated a $2 million private placement of convertible promissory notes on Sept. 29 with Avalon Ventures VII, LP, according to an 8-K filed Friday with the Securities and Exchange Commission.
The company has already raised $1 million in the deal.
The notes mature on Feb. 1, 2009. They bear interest at 8%.
If the company completes a preferred stock financing of at least $2 million prior to maturity, the notes will automatically convert into the number of preferreds issued to investors in that financing.
Investors also received five-year warrants to purchase additional shares at a price per share equal to the price that will be paid by investors in the financing.
The number of shares available for purchase under each warrant will be equal to the quotient of: 15% of the initial principal amount of the corresponding note divided by the applicable exercise price.
San Diego-based Akesis develops treatments for diabetes and metabolic disorders.
| Issuer: | Akesis Pharmaceuticals, Inc.
|
| Issue: | Convertible promissory notes
|
| Amount: | $2 million
|
| Maturity: | Feb. 1, 2009
|
| Coupon: | 8%
|
| Price: | Par
|
| Yield: | 8%
|
| Warrants: | 15% coverage
|
| Warrant expiration: | Five years
|
| Investor: | Avalon Ventures VII, LP
|
| Pricing date: | Sept. 29
|
| Settlement date: | Sept. 29 (for $1 million)
|
| Stock symbol: | OTCBB: AKES
|
| Stock price: | $0.38 at close Sept. 29
|
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