Roth Capital Partners is agent for deal; MHR Fund among the investors
By Devika Patel and Stephanie N. Rotondo
Knoxville, Tenn., June 30 - Emisphere Technologies, Inc. arranged a private placement of units to raise $3.75 million on June 29, according to an 8-K filed Thursday with the Securities and Exchange Commission. It also negotiated a second deal for the same amount with MHR Fund Management LLC. Roth Capital Partners is the agent.
The company will sell 4,300,438 common shares at $0.872 apiece, along with warrants. The warrants and shares will be sold in units of one common share and a warrant for 0.7 of a share. The price per share is a 19.26% discount to $1.08, the June 28 closing share price.
The warrants are exercisable at $1.09 for five years. The strike price reflects a 0.93% premium to the June 28 closing price.
The company also announced that it has negotiated a separate securities purchase agreement with MHR for a separate private placement of identical units. This deal will raise about $3.75 million as well through the sale of about 4.3 million units at the same price.
Michael R. Garone, interim chief executive and chief financial officer, told Prospect News that Emisphere elected to do the financing "because we were running out of cash."
Garone added that the terms of the deal were "very good" and that the company had received "good support" from its banker.
In connection with the deal, MHR waived certain anti-dilution adjustment rights under its 11% senior secured notes and certain warrants that would otherwise have been triggered by the private placement. As consideration for the waiver, MHR will also receive a warrant for 795,000 shares that will be reimbursed for up to $25,000 of its legal fees. The warrant has identical terms to those sold in the offering.
Proceeds will be used to fund the company's operations, including new product development and commercialization, and meet the company's obligations as they may arise.
Tarrytown, N.Y.-based Emisphere is a biopharmaceutical company.
| Issuer: | Emisphere Technologies, Inc.
|
| Issue: | Units of one common share and a warrant for 0.7 of a share
|
| Amount: | $7.5 million
|
| Units: | 8,600,876
|
| Price: | $0.872
|
| Warrants: | One warrant for 0.7 of a share per unit
|
| Warrant expiration: | Five years
|
| Warrant strike price: | $1.09
|
| Agent: | Roth Capital Partners
|
| Investor: | MHR Fund Management LLC (for about $3.75 million)
|
| Pricing date: | June 29
|
| Stock symbol: | OTCBB: EMIS
|
| Stock price: | $1.10 at close June 29
|
| Market capitalization: | $47.91 million
|
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