Lincoln Park Capital Fund to buy company common stock over three years
By Devika Patel
Knoxville, Tenn., Oct. 26 - Arrowhead Research Corp. arranged a $15 million stock purchase agreement with Lincoln Park Capital Fund, LLC on Oct. 20, according to an 8-K filed Wednesday with the Securities and Exchange Commission. It also negotiated a $1.02 million private placement of series A preferred convertible stock on Oct. 21 and Oct. 24, along with a $2.5 million placement of common stock on Oct. 21 for a total of $18.51 million.
The company will sell common shares to Lincoln Park over three years. The purchase price of the shares will be based on the prevailing market prices without any fixed discount.
The company has already paid a $269,500 commitment fee in stock valued at $0.391 per share and will pay an additional commitment fee of up to $346,500 as the facility is used, which will also be paid in stock valued at $0.391 per share.
In the preferreds sale, the company will sell 1,015 preferreds at $1,000.00 apiece by Oct. 26. Each preferred will automatically convert into 2,631.58 common shares after the company receives shareholder approval for the conversion.
In the last placement, the company will sell 6.75 million common shares at $0.37 per share. The price per share is a 13.95% discount to the Oct. 20 closing share price of $0.43.
Settlement for this last placement and for the preferreds sale is expected Oct. 26.
Proceeds will be used for general operations.
Located in Pasadena, Calif., Arrowhead develops nanotechnology used in life sciences, electronics and energy.
Issuer: | Arrowhead Research Corp.
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Issue: | Stock purchase agreement, series A preferred convertible stock
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Amount: | $18,512,500
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Warrants: | No
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Stock symbol: | Nasdaq: ARWR
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Market capitalization: | $39.52 million
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Stock purchase agreement
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Amount: | $15 million
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Tenor: | Three years
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Investor: | Lincoln Park Capital Fund, LLC
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Price: | No fixed discount
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Fees: | $616,000
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Pricing date: | Oct. 20
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Stock price: | $0.43 at close Oct. 20
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Preferred stock
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Amount: | $1,015,000
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Preferreds: | 1,015
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Price: | $1,000
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Conversion ratio: | 2,631.58 common shares per preferred
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Pricing dates: | Oct. 21, Oct. 24
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Settlement date: | Oct. 26
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Stock price: | $0.46 at close Oct. 21
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Common stock
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Amount: | $2,497,500
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Shares: | 6.75 million
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Price: | $0.37
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Pricing date: | Oct. 21
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Settlement date: | Oct. 26
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Stock price: | $0.46 at close Oct. 21
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