Immune Pharmaceuticals amends terms of loan with MidCap Funding III

Company also issues five-year warrants for 101,531 shares to investor

By Devika Patel

Knoxville, Tenn., Aug. 27 - Immune Pharmaceuticals Inc. said it restructured its loan with MidCap Funding III, LLC in connection with the merger of Immune Pharmaceuticals Ltd. and EpiCept Corp.

The amendment fixed the principal balance of the first tranche of the loan at about $4.4 million. Principal repayments on this tranche will begin on June 1, 2014, if Immune raises $5 million or more by Nov. 15. Otherwise, principal repayments on this tranche will begin on Dec. 1. Repayments will be due in equal monthly installments. The loan will mature on Aug. 1, 2016.

The second tranche, for $1 million, will be available through Aug. 1, 2014, if the company raises at least $17.5 million through one or more qualifying transactions. The second tranche will be repaid in equal monthly payments, ending at maturity. Interest on both tranches will accrue at 11.5% and will be paid monthly in arrears.

MidCap also received five-year warrants for 101,531 common shares, which are each exercisable at $3.50. The investor will receive additional warrants if the second tranche is drawn.

The specialty pharmaceutical company is based in Tarrytown, N.Y.

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