Tetra Bio-Pharma Inc. (TSX:TBP) said it has entered into an agreement with a syndicate led by Echelon Wealth Partners Inc. under which the underwriters have agreed to purchase 25 million units from the treasury of the company, at a price of 40 cents per unit, and offer them to the public by way of prospectus supplement for total gross proceeds of $10 million.
The company said it intends to use the net proceeds of the offering for clinical trials, working capital and general corporate purposes.
Each unit in the offering will consist of one common share of the company and one common share purchase warrant. Each whole warrant shall entitle the holder to acquire one common share for an exercise price of 51 cents and for a period of 24 months following the closing date.
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Tetra Bio-Pharma said it has also granted to the underwriters an overallotment option to purchase up to an additional 15% of the units at the issue price. The option may be exercised in whole or in part to purchase units as determined by the underwriters upon written notice to the company at any time up to 30 days following the closing date.
The offering is expected to close on or about May 17, 2021, or such other date as the company and the underwriters may agree, and is subject to customary closing conditions, including the approval of the securities regulatory authorities and the Toronto Stock Exchange.
The offering will be completed by way of a prospectus supplement to the bases shelf prospectus of the company dated April 1, 2020, to be filed in all of the provinces and territories of Canada, except Quebec; on a private placement basis in the United States under exemptions from the registration requirements of the United States Securities Act of 1933, as amended; and outside Canada and the United States on a basis that does not require the qualification or registration of any of the company's securities under domestic or foreign securities laws.
Tetra Bio-Pharma is a leader in cannabinoid-derived drug discovery and development with a US Food and Drug Administration (FDA) and a Health Canada cleared clinical program aimed at bringing novel prescription drugs and treatments to patients and their health care providers.
The company's evidence-based scientific approach has enabled it to develop a pipeline of cannabinoid-based drug products for a range of medical conditions, including pain, inflammation and oncology.
Contact the author at jon.hopkins@proactiveinvestors.com