Investor Oxford Finance also gets $1.65 million of seven-year warrants
By Devika Patel
Knoxville, Tenn., March 21 - Anacor Pharmaceuticals, Inc. negotiated a four-year loan with warrants on March 18, according to an 8-K filed Monday with the Securities and Exchange Commission. The $30 million financing is being provided by lead investor Oxford Finance Corp. and will settle in three tranches of $10 million.
The interest rate for each tranche will be fixed upon drawdown at a rate equal to the greater of 9.4% or 9.1% plus the 3-month U.S. Libor rate. Payments are interest-only until April 30, 2012, followed by equal monthly payments of principal and interest through the scheduled maturity date on April 1, 2015. In addition, a final payment equal to 5.5% of the amounts drawn will be due on April 1, 2015.
The company paid the lenders a $300,000 facility fee. In addition, if it repays all or part of the loan prior to maturity, it will pay the lenders a prepayment penalty fee based on a percentage of the outstanding principal balance. The fee will be equal to 3% if the prepayment occurs prior to March 18, 2012, 2% if the prepayment occurs prior to March 18, 2013 or 1% if the prepayment occurs prior to March 18, 2014.
Investors also will receive warrants for 80,527 common shares, which are exercisable at $6.83, identical to the March 17 closing share price of $6.83.
The number of shares into which the warrants are exercisable will increase by an amount equal to 5.5% of the amount drawn at each subsequent tranche, divided by the exercise price per share for that tranche, for a maximum exercise price of $1.65 million. The exercise price for the additional warrants will be the lower of the 10-day average share price prior to drawdown or the price per share on the day prior to drawdown. The warrants will expire March 18, 2018.
The pharmaceutical company is based in Palo Alto, Calif.
| Issuer: | Anacor Pharmaceuticals, Inc.
|
| Issue: | Loan
|
| Amount: | $30 million
|
| Maturity: | April 1, 2015
|
| Coupon: | The greater of 9.4% or 9.1% plus the 3-month U.S. Libor rate
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| Warrants: | For $1.65 million in shares
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| Warrant expiration: | March 18, 2018
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| Warrant strike price: | $6.83
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| Investor: | Oxford Finance Corp. (lead)
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| Fees: | $300,000
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| Pricing date: | March 18
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| Stock symbol: | Nasdaq: ANAC
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| Stock price: | $6.83 at close March 18
|
| Market capitalization: | $37.09 million
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