Matinas BioPharma launches $8 million offering of series B convertible preferred stock

By Abigail W. Adams

Portland, Me., June 19 – Matinas BioPharma Holdings Inc. launched an offering of $8 million, or 8,000 shares of series B convertible preferred stock on Monday with a discounted initial conversion premium of negative 20%, according to a 424B5 filing with the Securities and Exchange Commission.

ThinkEquity, a division of Fordham Financial Management Inc., is placement agent for the registered offering.

The par of $1,000 convertible preferred stock will be convertible into 2,000 shares of common stock at a conversion price of 50 cents per share with an aggregate 16,000 shares underlying the preferred stock.

Dividends will be paid as the number of shares of common stock equal to 10% of the shares of common stock underlying the holders series B convertible preferreds on the one-year anniversary of the filing of the certificate of designation for the convertible preferreds.

Dividend payments will increase on the two-year anniversary of the filing date to a number of shares of common stock equal to 15% of the common shares underlying the convertible preferreds.

On the three-year anniversary, payment will increase to 20% of the shares underlying the convertible preferreds, according to the 424B5 filing.

The series B convertible preferreds will automatically convert on the earlier of either Federal Drug Administration approval of one of the company’s product candidates, the consent to conversion by more than 50% of the holders or three years from the registration date.

Officers and directors of the company intend to purchase some convertible preferreds at the public offering price.

Proceeds will be used to support the development of product candidates and for general corporate purposes.

The company launched an offering of $15 million, or 15,000 shares of the series B convertible preferred stock on May 25 with the same terms as the current offering. However, the deal did not price.

Matinas BioPharma is a Bedminster, N.J.-based biopharmaceutical company.

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