Deal also includes warrant for 210,675 shares, exercisable at $2.67
By Devika Patel
Knoxville, Tenn., May 12 - Celator Pharmaceuticals Inc. arranged a $15 million term loan with Hercules Technology Growth Capital, Inc. on May 9, according to an 8-K filed Monday with the Securities and Exchange Commission.
The company has already drawn $10 million of the loan, which is repayable over 42 months. The remaining $5 million may be drawn at any time between Dec. 15 and March 31.
The loan accrues interest at the greater of 9.75% or the sum of 9.75% and the prevailing Prime rate minus 325 basis points. It may be prepaid with prepayment charges of 3% in the first year, 2% in the second year and 1% in the third year and beyond. Upon prepayment or maturity, Hercules will be paid a $592,500 end-of-term charge.
Hercules received a warrant for 158,006 shares and will receive an additional warrant for 52,669 shares with the remaining $5 million draw. The warrant is exercisable at $2.67 for five years. The strike price reflects a 1.11% discount to the May 8 closing share price of $2.70.
The company also paid a $150,000 facility charge to Hercules.
The pharmaceutical company is based in Ewing, N.J.
| Issuer: | Celator Pharmaceuticals Inc.
|
| Issue: | Term loan
|
| Amount: | $15 million
|
| Maturity: | 42 months
|
| Coupon: | Greater of 9.75% or the sum of 9.75% plus the prevailing Prime rate minus 325 bps
|
| Call: | Yes, with prepayment fees ranging from 1% to 3%
|
| Warrants: | For 210,675 shares
|
| Warrant expiration: | Five years
|
| Warrant strike price: | $2.67
|
| Investor: | Hercules Technology Growth Capital, Inc.
|
| Fees: | $150,000, plus $592,500 end-of-term charge
|
| Settlement date: | May 9 (for $10 million)
|
| Stock symbol: | Nasdaq: CPXX
|
| Stock price: | $2.70 at close May 8
|
| Market capitalization: | $67.69 million
|
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