Valeo Pharma Inc said that Desjardins Capital Markets, as lead underwriter and sole bookrunner, together with a syndicate of underwriters have agreed to increase the size of a previously announced bought deal private placement to $15 million from $10 million aggregate principal amount of convertible unsecured debentures of the company.
The net proceeds of the offering and concurrent private placement will be used to support commercial efforts related to the recently launched products (Redesca, Enerzair, and Atectura); to reimburse, at maturity, the non-convertible debentures previously issued by the company and maturing on January 31, 2022, and July 10, 2022; for working capital and general corporate purposes; and to support an upcoming TSX listing application.
The debentures will mature on December 31, 2024, and will accrue interest at the rate of 12.0% per annum, payable quarterly beginning on March 31, 2022. At the holders' option, the debentures may be converted into common shares of the company at any time and from time to time, up to the maturity date, at a conversion price of $1.15 per common share.
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The company said it will use commercially reasonable efforts to list the debentures on the Canadian Securities Exchange (CSE).
Concurrently with the offering, Investissement Québec has committed to a concurrent private placement of $10 million of convertible unsecured debentures issuable on the same terms as those issuable under the offering, resulting in aggregate gross proceeds from both of $25 million.
Investissement Québec's mission is to actively participate in Québec's economic development by stimulating business innovation, entrepreneurship and takeover, as well as investment and export growth. Present in every administrative region of Québec, the corporation supports the creation and development of businesses of all sizes through investments and adapted financial solutions.
The debentures and any common shares issuable upon conversion thereof will be subject to a statutory hold period lasting four months and one day following the Closing Date.
The closing of the offering and concurrent private placement is expected to occur on or about December 9, 2021, and is subject to certain conditions, including but not limited to, the receipt of all necessary regulatory and stock exchange approvals, including the approval of the CSE.
The securities being offered have not been, nor will they be, registered under the US Securities Act, and such securities may not be offered or sold within the United States or to, or for the account or benefit of, US persons absent registration or an applicable exemption from US registration requirements and applicable US state securities laws.
Valeo Pharma is a pharmaceutical company dedicated to the commercialization of innovative prescription products in Canada with a focus on Respirology, Neurodegenerative Diseases, Oncology and other specialty products.
Headquartered in Kirkland, Quebec, Valeo Pharma has the full capability and complete infrastructure to register and properly manage its growing product portfolio through all stages of commercialization.
Contact the author at jon.hopkins@proactiveinvestors.com