TORONTO--(BUSINESS WIRE)--
Acerus Pharmaceuticals Corporation (the “Company” or “Acerus”)
(TSX:ASP) today announced that it has entered into a senior secured term
loan credit facility with SWK Funding LLC (“SWK”) for up to US$11
million (the “New Facility”). An initial tranche of US$9 million
of the New Facility was available at closing, with the remaining US$2
million of the New Facility becoming available upon satisfaction of
certain future conditions. The New Facility replaces the CDN$5 million
senior secured credit facility with Quantius Inc. entered into on
December 6, 2017 (the “Quantius Facility”).
“SWK is a sophisticated partner, dedicated to providing debt financing
to companies involved in the life sciences sector, and securing this
term loan credit facility allows us to consolidate our debt with a
single lender,” said Ken Yoon, Chief Financial Officer of Acerus.
“Improving our access to capital and strengthening the balance sheet has
been a recent strategic focus. This minimally dilutive financing both
offers us improved financial flexibility in the near-term and
demonstrates our ability to access various sources of capital to fund
our business.”
“We are pleased to partner with Acerus to provide a minimally dilutive,
flexible capital solution to help grow the Company,” commented Winston
Black, CEO of SWK. “We believe in Acerus’ business model and are
impressed with the depth and quality of the management team. Acerus’
commercial success in Canada, as demonstrated by the rapid market share
gains for Natesto®, coupled with its proprietary drug
delivery technology, well positions the Company for a bright future.”
The New Facility bears interest at a rate per annum equal to the greater
of (a) the three-month London Inter-Bank Offered Rate (“LIBOR”),
or (b) 1.50%, with such base rate being capped at no greater than 4.25%,
plus an applicable margin of 10.50%. The New Facility matures on October
11, 2023 and is interest-only for the first two years of the term.Under
the terms of the agreement, the Company will have the option to prepay
the loan prior to the maturity date subject to the payment of certain
prepayment fees. The terms of the agreement also contain customary
financial covenants.The proceeds from the New Facility will be
used primarily to (i) repay the amount outstanding under the Quantius
Facility, including a prepayment penalty and royalty retirement fee;
(ii) retire the Endo promissory note with a payment in the amount of
approximately US$860,000; and (iii) for ongoing general working capital.
A copy of the credit agreement governing the New Facility will be filed
under the Company’s profile on SEDAR at www.sedar.com.
As part of the transaction, SWK will receive an origination fee
representing a low single digit percentage of the maximum facility
amount, as well as a final payment representing a single digit
percentage of the principal amount actually advanced under the facility.
Acerus has also issued 5,331,563 common share purchase warrants (the “Warrants”)
to SWK as partial consideration for the New Facility. Each Warrant
entitles SWK to purchase one common share of Acerus at an exercise price
of CDN$0.40 per common share and expires on October 11, 2023. In certain
circumstances, following the second anniversary of the issuance of the
Warrants, the Company can cause SWK to exercise the Warrants prior to
their expiry date if the closing price of the Company’s common shares on
the TSX exceeds CDN$0.80 per share for a period of at least 21
consecutive trading days.
About Acerus Pharmaceuticals Corporation
Acerus Pharmaceuticals Corporation is a Canadian-based specialty
pharmaceutical company focused on the development, manufacture,
marketing and distribution of innovative, branded products that improve
patient experience, with a primary focus in the field of men’s and
women’s health. The Company commercializes its products via its own
salesforce in Canada, and through a global network of licensed
distributors in the U.S. and other territories.
Acerus’ shares trade on Toronto Stock Exchange under the symbol “ASP”.
For more information, visit www.aceruspharma.com
and follow us on Twitter and LinkedIn.
About SWK Holdings Corporation
SWK Holdings Corporation is a publicly traded, specialized finance
company with a focus on the global healthcare sector. SWK partners with
ethical product marketers and royalty holders to provide flexible
financing solutions at an attractive cost of capital to create long-term
value for both SWK’s business partners and its investors.
Notice Regarding Forward-Looking Information
Information in this press release that is not current or historical
factual information may constitute forward-looking information within
the meaning of securities laws. Implicit in this information are
assumptions regarding our future operational results. These assumptions,
although considered reasonable by the company at the time of
preparation, may prove to be incorrect. Readers are cautioned that
actual performance of the company is subject to a number of risks and
uncertainties, and could differ materially from what is currently
expected as set out above, including with respect to the use of proceeds
from the New Facility and the anticipated benefits of the New Facility.
For more exhaustive information on these risks and uncertainties you
should refer to our annual information form dated March 20, 2018 that is
available at www.sedar.com.
Forward-looking information contained in this press release is based on
our current estimates, expectations and projections, which we believe
are reasonable as of the current date. You should not place undue
importance on forward-looking information and should not rely upon this
information as of any other date. While we may elect to, we are under no
obligation and do not undertake to update this information at any
particular time, whether as a result of new information, future events
or otherwise, except as required by applicable securities laws.
View source version on businesswire.com:
https://www.businesswire.com/news/home/20181012005230/en/
Acerus Pharmaceuticals Corporation
Ken Yoon, (905) 817-8288
Chief
Financial Officer
kyoon@ceruspharma.com
Source: Acerus Pharmaceuticals Corporation