WARRINGTON, Pa. (AP) -- Biotechnology company Discovery Laboratories Inc. said Tuesday it entered into a committed equity financing facility that will provide up to $60 million in capital over the next three years.
Under the terms of the deal, private investment group Kingsbridge Capital Ltd. has committed to provide the capital through the purchase of newly issued shares of Discovery Laboratories’ common stock.
In connection with the facility, Discovery Labs issued a warrant to Kingsbridge to buy up to 825,000 shares at an exercise price of $2.51 per share, which represents a 40 percent premium to the average closing prices of Discovery’s stock during the five days before the agreement was signed. The warrant will be exercisable after six months and will remain exercisable for five years.
The number of shares sold over the term will not exceed 19.3 million shares, Discovery said.
Discovery said the new financing, combined with existing cash and a prior financing facility, significantly improves its financial flexibility to support the potential commercialization of Surfaxin, which is designed to prevent respiratory distress syndrome in premature infants.
