This article updates an earlier story published in the Prospect News Convertibles Daily that was based on a press release and preliminary prospectus.
New Issue: EpiCept sells $25 million five-year convertibles to yield 7.5556%, up 7%
By Rebecca Melvin
New York, Feb. 5 - EpiCept Corp. has priced $25 million of five-year convertible senior subordinated notes, plus warrants, to yield 7.5556% with an initial conversion premium of 7%, according to a final prospectus.
Purchasers of the convertibles will receive warrants to purchase up to 444 shares of common stock at an exercise price of $1.035 per share for each $1,000 in principal amount of convertibles.
An earlier Prospect News story based on a press release and preliminary prospectus reported a different coupon, warrant amount and exercise price.
The warrants and convertibles will be issued separately.
The registered offering is being placed via Rodman & Renshaw LLC, a subsidiary of Rodman & Renshaw Capital Group.
The deal was announced as up to $25 million in size and was fully placed at the maximum amount.
Holders can convert into shares at any time. After one year, the convertibles will be converted automatically into shares of common stock if the stock trades for 20 days within any 30-day trading period at $1.72 per share or more.
In addition, if the convertibles are converted or redeemed at any time prior to maturity, holders will be paid an amount equal to the total interest that would accrue on the notes from the conversion date through the maturity date up to $377.78 per $1,000 principal amount of notes converted or redeemed.
Upon completion of the offering, the company will deposit in escrow $9.4 million for 24 months for the purpose of paying interest and for make-whole payments.
Of the remaining net proceeds, about $15.6 million are intended to repay outstanding debt, including its senior secured loan with Hercules Technology Growth Capital Inc., the remaining $0.4 million of EpiCept's subordinated convertible notes due April 10, 2009, and the company's €1.5 million loan held by Technologie-Beteiligungs Gesellschaft mbH der Deutschen Ausgleichsbank.
Any remaining proceeds will be used for working capital and general corporate purposes.
EpiCept is a Tarrytown, N.Y.-based specialty pharmaceutical company focused on the development of products for cancer and pain.
| Issuer: | EpiCept Corp.
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| Issue: | Convertible senior subordinated notes
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| Amount: | $25 million
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| Maturity: | Feb. 9, 2014
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| Bookrunners: | Rodman & Renshaw LLC
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| Coupon: | 7.5556%
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| Price: | Par of $1,000
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| Conversion premium: | 7%
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| Conversion price: | $0.91
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| Pricing date: | Feb. 4
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| Settlement date: | Feb. 9
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| Stock symbol: | Nasdaq: EPCT
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