Existing OCABSA financing program renegotiated to reduce cost of capital for TxCell and dilution for shareholders
€15 million guaranteed in monthly installments now at TxCell’s sole discretion1
Cash runway extended1 even if listed cash warrants are not fully exercised by February 26, 2018
Valbonne, France, October 25, 2017, 5.45pm CEST
TxCell SA (FR0010127662 – TXCL) (the “Company”), a developer of cellular immunotherapies based on regulatory T cells (Tregs) for inflammation, autoimmunity and transplantation, today announces it has signed an amendment to its contract with Yorkville Advisors Global LP. The updated agreement modifies the existing optional financing contract through the issuance of notes convertible into shares with share subscription warrants attached (together the Notes with Warrants or OCABSA). This contract was originally signed in June 2016, as described in the TxCell press release dated June 17, 2016.
The main amendments to the optional financing deal with Yorkville are as follows:
- Total financing: up to €15 million (existing balance unchanged)
- Monthly tranches now at the sole option of TxCell
- The discount applicable to the notes conversion has been reduced to 5% of the reference share price, decreased from 7%
- The number of shares issued upon exercise of the warrants attached to a tranche of notes has been reduced to 25% of the tranche nominal value, decreased from 50%
- The exercise premium for the warrants has been increased to 30% of the reference share price, up from 15%, with a €3 floor price
Additional information and details on the amended contract are available at the end of this press release (see PDF file).
TxCell intends to use this optional financing program primarily in the event that the listed cash warrants issued as part of the February 2017 capital increase are not fully exercised by holders at maturity (February 26, 2018).
“Renegotiating the OCABSA program provides TxCell with a secured financing option beyond the maturity of the listed warrants issued in February 2017,” said Raphaël Flipo, CFO of TxCell. “The renegotiated terms have a number of advantages for both TxCell and its shareholders. Firstly, the program’s cost has been reduced and compares rather favorably with the other financing options we have considered. Secondly, its use is entirely at TxCell’s discretion. Among other things, this allows for a better control on its dilutive impact.”
“TxCell has now demonstrated very encouraging signals of activity with our breakthrough CAR Treg technology. Recently, TxCell obtained a new proof-of-concept in its transplantation program with the University of British Columbia, one of our research partners. We look forward to presenting new data in the near future with our additional CAR-Treg programs that are targeting other diseases,” said Stéphane Boissel, CEO of TxCell. “In addition to security, this improved OCABSA program would represent a temporary solution that can be used on a monthly basis as TxCell actively works towards securing a longer-term financing with acceptable terms. These options include a strategic partnership and/or a fund raising which will be considered if the market capitalization increases.”
(1) Subject to the satisfaction of certain conditions listed in the appendix (see PDF file).