Emergent BioSolutions Inc. (NYSE:EBS), a biopharmaceutical company, has completed an unregistered issuance of equity securities, according to a recent SEC filing. On Monday, the company finalized the distribution of 1,113,338 shares of common stock at approximately $8.98 per share. This transaction is part of a credit agreement dated August 30, 2024, involving the company, several lenders, and OHA Agency LLC as the administrative agent.
Concurrent with the share issuance, Emergent BioSolutions established the exercise prices for two series of warrants issued to the lenders. The Series I Warrants, which allow for the purchase of 1,000,000 shares of common stock, have an exercise price of $9.8802 per share. The Series II Warrants, applicable for 1,500,000 shares, have been priced at $15.7185 per share. These warrants are exercisable immediately and will remain valid until August 30, 2029, unless they are exercised earlier.
The shares and warrants were issued under Section 4(a)(2) of the Securities Act of 1933, as amended, which exempts transactions by an issuer not involving any public offering. Emergent BioSolutions did not generate any proceeds from the initial issuance of these securities. However, the company will receive funds upon any future exercise of the warrants, based on their set exercise prices.
This strategic move by Emergent BioSolutions allows lenders to invest directly in the company's equity, potentially aligning the interests of the lenders with the company's performance. It also provides the company with a mechanism to raise capital in the future through the exercise of the warrants.
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