Universal Ibogaine Inc (TSX-V:IBO) (UI) reported it was set to carry out an offering of convertible debt securities with net proceeds to be used to complete its planned ibogaine-based clinical trial application with Health Canada and for working capital.
Net proceeds will also be used for finalizing a supply agreement for ibogaine to be used in the eventual trials, said the life sciences group.
CEO Nick Karos said: "We are pleased to have generated support for this offering, for which we intend to finalize commitments shortly for a funding target of up to $15 million.
"This funding will help to advance UI to its next stage of development in our ultimate goal of having ibogaine medicalized and accepted for wide-scale use in addiction treatments."
The 'Secured Guarantee Convertible Notes' issued will bear interest at 8% (payable quarterly) and will mature three years from closing.
READ: Universal Ibogaine says Kelburn addiction recovery clinic to reopen on October 17, 2022
On a future conversion, the holder of the notes will receive one 'unit' comprised of one Universal Ibogaine (UI) share and one-half of a share purchase warrant.
The notes will have a conversion price of C$0.10 per share in year one after closing, C$0.15 for year two, and C$0.20 for year three.
"The notes will be subordinated to the company’s existing mortgage on the Kelburn Recovery Centre and a General Security Agreement will be issued as part of the closing by UI’s BC based 100% owned subsidiary company (which in turn owns the company’s Kelburn Recovery Centre addiction treatment clinic near Winnipeg and a 20 acre undeveloped land project in Belize)," the firm added.
UI aims to transform addiction treatment using medicalized ibogaine through a planned Canadian clinical trial focused on opioid use disorder, and ultimately use that protocol globally through planned future licensing agreements.
Contact the writer at giles@proactiveinvestors.com