Redx Pharma plc Short-term Debt Funding Secured (6015B)
10 June 2019 - 4:00PM
UK Regulatory
TIDMREDX
RNS Number : 6015B
Redx Pharma plc
10 June 2019
THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY
THE COMPANY TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER
THE EU MARKET ABUSE REGULATION (596/2014). UPON THE PUBLICATION OF
THE ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS
INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN
REDX PHARMA PLC
("Redx" or "the Company" or "the Group")
Short-term Debt Funding Secured
Alderley Park, 10 June 2019 Redx (AIM: REDX), the drug discovery
and development company focused on cancer and fibrosis, is today
providing an update on its ongoing plans to strengthen the Group's
balance sheet.
Further to the announcement released on 3 May 2019, the Board is
pleased to announce that the Company has signed an agreement with
Moulton Goodies Ltd. ("MGL") for a fixed rate secured loan note
facility of up to GBP2.5 million (the "Loan").
The Loan will serve to further extend the Company's cash runway
into the fourth quarter of 2019 and will be used to augment general
working capital. The Company intends to immediately draw down GBP1
million of the Loan, and has the option to draw the remainder in up
to two further tranches of no less than GBP500,000 each.
As previously highlighted, the Board continues to be in active
discussions with shareholders and third-party healthcare specialist
investors regarding longer-term funding of the Group and to pursue
potential value realisation opportunities for the pan-RAF research
programme. The Company will provide further updates in due
course.
As MGL holds 18.16% of the Company's issued ordinary shares the
Loan constitutes a related party transaction for the purposes of
Rule 13 of the AIM Rules. The Board consider that the terms of the
Loan are fair and reasonable insofar as the Company's shareholders
are concerned, having consulted with Cantor Fitzgerald Europe, the
Company's nominated adviser.
The principal terms of the Loan are as follows:
-- Up to GBP2.5 million may be borrowed;
-- The Loan is secured by fixed and floating charges over all
assets of the Group and its subsidiaries, with the exception of the
pan-RAF research programme;
-- Interest is payable at 10 per cent. per annum, with such
interest to be paid at the same time as the Loan is repaid;
-- The Loan (together with all unpaid interest) is repayable in
full on 31 December 2019, but may become payable earlier in the
event, inter alia, of default;
-- MGL can request that the Company capitalise the Loan into new
ordinary shares in the Company, either at maturity or in the event
that the Company completes an equity financing to raise at least
GBP10 million (or such lesser amount as MGL may determine at its
discretion, providing such amount is at least GBP1 million)
("Financing Round"). In addition, the Company has the right to
require MGL to capitalise the Loan on a Financing Round which,
inter alia, raises gross proceeds of at least GBP20 million. Any
capitalisation would be subject, inter alia, to the Company
obtaining shareholder approval to issue the requisite number of new
ordinary shares and to disapply pre-emption rights;
-- The Company has undertaken to draw the facility in full upon
any Financing Round taking place. In the event that the Loan is
capitalised on a Financing Round, it would do so at discounts of 30
per cent. to the issue price of the new ordinary shares in the
Financing Round for those amounts drawn prior to the Financing
Round and 13 per cent. to the issue price of the new ordinary
shares in the Financing Round for those amounts drawn upon the
Financing Round;
-- In the event that the Loan is capitalised on maturity, such
capitalisation would be at the lower of the volume-weighted average
price per ordinary share over the 10 business day period
immediately prior to either (a) the date of signing the agreements
for the Loan; or (b) the 31(st) December 2019 (or by reference to
changes in the Group's net asset value over the same period if no
ordinary shares were to remain publicly traded at maturity);
-- In the event of any sale of all, or substantially all, of the
assets or ordinary shares of the Company, or a merger or similar
reorganisation of the Company, the Loan is repayable with a 30 per
cent. repayment premium on amounts drawn, together with any
interest due;
-- Standard representations and warranties have been provided to
MGL upon signing the Loan agreements and will be repeated at each
subsequent draw down.
For further information, please contact:
Redx Pharma Plc T: +44 1625 469
920
Lisa Anson, Chief Executive Officer
James Mead, Chief Financial Officer
Cantor Fitzgerald Europe (Nominated Advisor & T: +44 20 7894
Joint Broker) 7000
Phil Davies
WG Partners LLP (Joint Broker) T: +44 20 3705
9330
Claes Spång/ Chris Lee/ David Wilson
FTI Consulting T: +44 20 3727
1000
Simon Conway/Ciara Martin
About Redx Pharma Plc
Redx is a UK based biotechnology company whose shares are traded
on AIM (AIM:REDX). Redx's vision is to become a leading biotech
focused on the development of novel precision medicines that have
the potential to transform treatment in oncology and fibrotic
diseases.
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END
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