Oncobiologics Inc. agreed to issue and sell to existing investors up to $10 million of senior secured promissory notes and five-year warrants to acquire 2.3 million common shares of the company.
The notes bear interest rates of 5.0% per year with a one-year maturity, while the warrants have an exercise price of $3 per share.
At the initial closing, the company issued about $8.4 million of notes and 1,920,500 warrants. The company may issue up to about $1.7 million of additional notes and 379,500 warrants in additional closings without approval of the note holders.
Oncobiologics used a portion of the proceeds to pay off existing senior secured bank loans and will use the rest for working capital purposes as it pursues strategic opportunities.