Armata Pharmaceuticals Announces Closing of $30 Million Secured Convertible Credit Agreement with Innoviva Strategic Opportunities LLC
Armata Pharmaceuticals, Inc. (NYSE American: ARMP) ("Armata" or the "Company"), a biotechnology company focused on pathogen-specific bacteriophage therapeutics for antibiotic-resistant and difficult-to-treat bacterial infections, today announced that it has closed a secured convertible credit agreement (the "credit agreement") with Innoviva Strategic Opportunities LLC, a wholly-owned subsidiary of Innoviva, Inc. (Nasdaq: INVA) (collectively, "Innoviva"), Armata's largest shareholder. The gross proceeds to the Company from the transaction are $30 million, before deducting estimated transaction-related expenses payable by the Company.
Armata intends to use the net proceeds from this transaction to continue clinical development of AP-PA02 and AP-SA02. Additionally, these funds will finance the completion of an advanced biologics cGMP manufacturing facility with the technology and capacity to support production of complex multi-component phage therapeutics. When completed, Armata's new manufacturing facility is expected to enable the Company to execute late-stage and registrational trials and create strategic partnership opportunities leveraging the Company's core strength in advanced biologics manufacturing.
The credit agreement provides for a one-year term loan facility in an aggregate amount of $30 million at an interest rate of 8.0% per annum. Pursuant to the credit agreement, the balance on the loan, including all accrued and unpaid interest thereon, will convert into shares of Armata's common stock upon the occurrence of a qualified financing. Any portion of the balance on the loan, including all accrued and unpaid interest thereon, may also be converted into shares of Armata's common stock at Innoviva's option once a registration statement covering the resale of such securities has been declared effective by the U.S. Securities and Exchange Commission ("SEC"). The loan is secured by substantially all of the assets of Armata and its domestic and foreign material subsidiaries. Armata has not issued any warrants in connection with the agreement.
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