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Crossject obtains a financing up to €12 million, in two tranches | ||||||||||||||||||||||||||||||||||||||||||||||||||||
By: GlobeNewswire - 27 Feb 2024 | Back to overview list |
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Dijon, February 27, 2024 at 8:30am Crossject obtains a financing up to €12 million, in two tranches, CROSSJECT (ISIN: FR0011716265; Stock symbol: ALCJ), a specialty pharma company developing needle-free auto-injectors for emergency situations, , announces today the issue, waiving preferential subscription rights and reserved for a category of investors3 of 70 amortizable bonds convertible into new stock with a nominal value of €100,000, for an amount of €7 million following the 13th extraordinary resolution of the Combined General Meeting of June 7, 2023 and the decision taken on February 26, 2024 by a member of the Executive Board acting within the sub-delegation granted by the Executive Board meeting on February 23, 2024 with authorization by the Supervisory Board on January 29, 2024 ("Issue"). "We are proud to have raised this new capital from an entity managed by Heights Capital Management, Inc. (“Heights”), an institutional investor specialized in financing growing companies. It is a sign of confidence in our industrial and market progress, particularly in North America4. These funds are in addition to the current funding by BARDA (for $6.7 million invoiced over 2023 out of a maximum overall budget of $32 million), under contract 75A50122C00031, for the advanced development of its ZENEO-midazolam autoinjector (proposed name ZEPIZURE®) through approval by the United States Food and Drug Administration (FDA) for the treatment of status epilepticus seizures. The contract also includes future prospects for the supply of $60 million worth of ZEPIZURE®, which will be delivered to the United States Government, once the product has been granted Emergency Use Authorization by the FDA. The form taken by the financing granted by Heights meets our primary objective of having solutions with cash repayment over time and limited dilution. This maximum financing of €12 million is in addition to other non-dilutive financing recently secured real estate sale and leaseback transaction for about €5 million, pre-financing of the 2023 Research Tax Credit for €1.5 million out of €3 million, etc.) and commercial revenues related to new or existing partnerships.’ said Patrick Alexandre, CEO of Crossject. Crossject stocks have been listed on Euronext Growth Paris since February 28th, 2014.
STRUCTURE OF THE OPERATION Funding from Heights may reach up to €12 million in two tranches: The Initial Investment or First Tranche of €7 million may be supplemented by a Second Tranche of a maximum amount of €5 million on Crossject’s initiative and subject to compliance with certain conditions. The issuance covered herein does not give rise to a Prospectus submitted for AMF approval. Characteristics specific to the First Tranche
Characteristics specific to the Second Tranche Crossject has the right (and not the obligation) to request the total or partial drawdown of the Second Tranche for twelve (12) months from June 28, 2024 (i.e. from the due date of the first repayment of Tranche 1), provided the following conditions are met:
Characteristics common to the First and Second Tranches Maturity Each tranche will mature after three (3) years from issue date. Amortization and main features For each tranche, the amortization schedule of the convertible bonds is provided for at the rate of seventeen (17) equal payments every two (2) months, from the 4th month following the date of issue, payable according to the company’s options:
If Crossject decides to repay in shares and the stock price of the instalment payment is inferior to the floor price, Crossject will deliver a number of shares calculated on the basis of the floor price and pay the difference in cash (calculated on the basis of the stock price the day before the date of the settlement amortization). The share of amortized stock decided by Crossject may not require the Investor to hold more than 9.99% of Crossject's capital stock (including accrued interest paid in stocks). If the Company pays the last amortization schedule installment in stocks, the Investor may ask for the repayment of up to two amortization schedule installments to be brought forward under certain conditions. Subject to the Company's consent, he also has the right to request the deferral of payment of an early amortization installment. In the event of a customary default by the Company or a change of control, the Investor has the right to request early redemption of the convertible bonds7. The same right is granted to the Investor if the resolution linked to the new floor pice does not pass in an next Extraordinary Assembly (see Infra). Interest The convertible bonds bear interest at a rate of seven (7)% per annum. Accrued interest will be paid at the same time as amortization and payable according to the Company's options:
Conversion to stocks The convertible bonds may be converted into new common stock of the Company exclusively on the bonds holder’s initiative at any time after issue. The convertible bonds' conversion price equals 135% of the Market Value when each tranche is issued. For the First Tranche, the convertible bonds may be converted into new ordinary stocks of the Company at an initial ratio of 19,420.4925 stocks per convertible bond, i.e. a conversion price of 5.1492 euros per ordinary stock, which may be adjusted in accordance with the terms and conditions of the convertible bonds within the limit of the applicable floor price. The conversion price of the convertible bonds may be adjusted in the event of the occurrence of certain events as details in the terms and conditions of the convertible bonds. Crossject will publish the number of new stocks issued under the terms of the convertible bonds on its website regularly. Any new stocks issued on conversion of the convertible bonds have immediate dividend rights. They have the same rights as the company's existing common stocks and will be listed on the Euronext Growth Paris market on the same listing line (FR0011716265). Admission to a stock exchange: There shall be no request for admission of the convertible bonds to any financial market when they are issued. The convertible bonds will only be transferable subject to Crossject's agreement (except for the transfer to an affiliated member of the Investor). Use of proceeds The aim of the proceeds is to enable Crossject to ramp up industrial and commercial development of its ZENEO technology. DECLARATION ON WORKING CAPITAL Taking into account the net proceeds from the issue of the convertible bonds described in this press release, the option on the Second Tranche, other non-dilutive financing planned (grants, repayable advances, etc.), ongoing contracts and its available cash, the Company believes that its net working capital is sufficient to meet its obligations over the next 12 months, in the event that all of these elements are realized over the period. The Company is also confident in its ability to find, if needed, the necessary financing to continue its development. DISCLAIMER This issuance will not give rise to a Prospectus submitted for AMF approval. IMPACT OF THE ISSUANCE ON STOCKHOLDERS CURRENTLY HOLDING 1% OF CROSSJECT CAPITAL STOCK For information purposes, the impact of the capital increase on stockholders holding 1% of Crossject's capital stock prior to conversion of the convertible bonds and/or amortization of the latter in new stocks, depending on the assumptions described below, would be as follows:
RISK FACTORS Risks related to financing obtained in the form of convertible bonds Crossject has set up a financing arrangement with convertible bonds purchased by Heights and, once it has received the stocks resulting from the conversion or exercise of these instruments, does not intend to remain a stockholder in the company. Stocks resulting from the conversion or exercise of the securities mentioned above will generally be sold on the market very quickly, which can create strong downward pressure on the stock price. Stockholders may suffer a loss of their invested capital due to a significant decrease in the company's stock value and significant dilution due to the large number of securities issued to Heights. Investors are advised to exercise extreme caution before deciding to invest in a listed company's securities that carry out such dilutive financing transactions, particularly when carried out successively. Crossject would like to point out that this is not its first financing transaction with a dilutive impact. In addition, the financing agreement concluded with the Investor includes repayment clauses: General risks Investors are invited to take into consideration the risk factors described in the 2022 annual report (and the entirety of this report) and in the 2023 half-yearly report (available on the Company's website: www.crossject.com). Crossject (ISIN: FR0011716265; Stock symbol: ALCJ (Euronext:LEI; www.crossject.com) is developing and will soon market a portfolio of drugs for use in emergency situations: epilepsy, overdose, allergic shock, severe migraine, and asthma attack. Thanks to its patented needle-free auto-injector, Crossject aims to become the world leader in self-administered emergency drugs. The company has been listed on the Euronext Growth Paris market since 2014, and receives financing, including from the American BARDA (Biomedical Advanced Research and Development Authority) and Bpifrance. 1 Based on the lowest volume-weighted average daily price of the Company's stocks over the last five (5) trading days prior the issuance of each tranche of bonds. Attachment |
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