Sorrento Therapeutics Announces Unsecured $120.5M Convertible Note Financing
SAN DIEGO, March 27, 2018 (GLOBE NEWSWIRE) -- Sorrento Therapeutics, Inc. (NASDAQ:SRNE) ("Sorrento"), announced today that it has entered into a securities purchase agreement to sell $120.5 million of unsecured convertible notes in a private placement to certain accredited investors.
The notes will be convertible into shares of Sorrento common stock at a price of $7.0125 per share and will accrue interest at a rate of 5% per year. Each purchaser of the convertible notes will also receive a warrant to purchase 50% of the number of shares of Sorrento common stock into which such purchaser’s note is initially convertible. The warrants will have an exercise price of $8.77 per share, or 125% of the initial conversion price of the notes.
The closing of the purchase and sale of the notes is expected to occur within 30 business days of March 26, 2018, subject to customary closing conditions.
“We are extremely pleased with this financing. This shows how much we have progressed in the last few years, and our loyal investor base continues to support our long-term efforts,” stated Dr. Henry Ji, Chairman and CEO for Sorrento.
Subject to the closing of this financing, together with current cash on hand, Sorrento expects to have approximately $150 million in cash, allowing the company to continue executing for the next 18 - 24 months on its long-term strategy to increase stockholder value.
The notes, warrants and shares issuable upon conversion of the notes and exercise of the warrants have not been registered under the Securities Act of 1933, as amended, or with any securities regulatory authority of any state or other jurisdiction, and may not be offered or sold in the United States or to U.S. persons absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction.
At the closing of the financing, Sorrento and the purchasers of the notes will enter into a registration rights agreement pursuant to which, among other things, Sorrento will agree to prepare and file one or more registration statements with the Securities and Exchange Commission (the SEC) for the purpose of registering for resale the shares issuable upon conversion of the notes and exercise of the warrants. Under the registration rights agreement, Sorrento will agree to file a registration statement with the SEC registering all of shares issuable upon conversion of the notes and exercise of the warrants for resale by no later than the date 45 days after the closing of the financing.
