Cellectis announces the drawdown of the second tranche of €15 million under the credit facility agreement entered with the European Investment Bank (EIB)
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Insights
The drawdown of the second tranche of €15 million by Cellectis under the agreement with the European Investment Bank signals a strategic move to bolster the company's financial position. This infusion is earmarked for the development of their allogeneic CAR T-cell product candidates, indicating a focused allocation of resources towards research and development. The maturity term of six years and the 7% annual interest rate, compounded and payable at maturity, is a critical aspect for investors to consider. This interest rate is relatively high, suggesting a risk premium associated with the investment. Investors should scrutinize the potential implications on the company's long-term financial health, given the cost of capital and the inherent risks of clinical-stage biotech investments.
The issuance of Tranche B Warrants as part of the financing deal is a noteworthy event for the biotechnology sector. With each warrant priced at €2.53, which is 99% of the volume-weighted average price, there is a slight discount for the EIB, potentially diluting current shareholders' value by approximately 2%. However, this dilution is counterbalanced by the capital influx aimed at advancing Cellectis' pipeline, which includes promising CAR T-cell therapies. The success of these therapies, such as UCART22, UCART20x22 and UCART123, could be transformative for the treatment of various cancers, underscoring the importance of this funding for the company's strategic growth and the potential long-term value creation for shareholders.
The legal framework governing the issuance of Tranche B Warrants, as per the French Commercial Code and the stipulations of the shareholders’ meeting resolutions, is central to ensuring the legitimacy of this transaction. The conditions set forth for the drawdown of the additional tranche, including the issuance of more warrants, should be evaluated for their legal soundness and potential impact on the company's governance structure. It is essential for stakeholders to understand the legal intricacies of such financial instruments and their implications on corporate control and future financing flexibility.
NEW YORK, Jan. 16, 2024 (GLOBE NEWSWIRE) -- Cellectis (Euronext Growth: ALCLS – NASDAQ: CLLS) (the “Company”), a clinical-stage biotechnology company using its pioneering gene-editing platform to develop life-saving cell and gene therapies, today announced that it has drawn down the second tranche of
As a condition to the disbursement of Tranche B the Company issued 1,460,053 warrants to the benefit of the EIB, in accordance with the terms of the 14th resolution of the shareholders’ meeting held on June 27, 2023 and articles L. 228-91 and seq. of the French Commercial Code (the “Tranche B Warrants”).
Each Tranche B Warrant allows the EIB to subscribe for one ordinary share of the Company, at a price of
Tranche B will mature six years from its disbursement date and will accrue interest at a rate of
The other terms of the Tranche B Warrants and prepayment events of Tranche B under the Finance Contract are as set forth in the Company’s press release of April 4, 2023 and Form 6-K filed with the U.S. Securities and Exchange Commission on such date.
The Finance Agreement allows the Company to drawdown a third tranche, of a maximum amount of
About Cellectis
Cellectis is a clinical-stage biotechnology company using its pioneering gene-editing platform to develop life-saving cell and gene therapies. Cellectis utilizes an allogeneic approach for CAR-T immunotherapies in oncology, pioneering the concept of off-the-shelf and ready-to-use gene-edited CAR T-cells to treat cancer patients, and a platform to make therapeutic gene editing in hemopoietic stem cells for various diseases. As a clinical-stage biopharmaceutical company with over 23 years of experience and expertise in gene editing, Cellectis is developing life-changing product candidates utilizing TALEN®, its gene editing technology, and PulseAgile, its pioneering electroporation system to harness the power of the immune system in order to treat diseases with unmet medical needs. Cellectis’ headquarters are in Paris, France, with locations in New York, New York and Raleigh, North Carolina. Cellectis is listed on the Nasdaq Global Market (ticker: CLLS) and on Euronext Growth (ticker: ALCLS).
Cautionary Statement
This press release contains “forward-looking” statements within the meaning of applicable securities laws, including the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words such as “expect,” “plan,” and “will,” or the negative of these and similar expressions. These forward-looking statements, which are based on our management’s current expectations and assumptions and on information currently available to management. Forward-looking statements include statements about the satisfaction of additional conditions under the Finance Contract, drawing of Tranches under the Finance Contract, potential future financings and strategic transactions, advancement, timing and progress of clinical trials (including with respect to patient enrollment and follow-up), the issuance of EIB Warrants, and the use of the proceeds of amounts received under the Finance Contract. These forward-looking statements are made in light of information currently available to us and are subject to numerous risks and uncertainties, including with respect to the numerous risks associated with market conditions, and our ability to satisfy the conditions precedent under the Finance Contract. Furthermore, many other important factors, including those described in our Annual Report on Form 20-F as amended and in our annual financial report (including the management report) for the year ended December 31, 2022 and subsequent filings Cellectis makes with the Securities Exchange Commission from time to time, which are available on the SEC’s website at www.sec.gov, as well as other known and unknown risks and uncertainties may adversely affect such forward-looking statements and cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons why actual results could differ materially from those anticipated in the forward-looking statements, even if new information becomes available in the future.
For further information on Cellectis, please contact:
Media contact:
Patricia Sosa Navarro, Chief of Staff to the CEO, +33 (0)7 76 77 46 93, media@cellectis.com
Investor Relations contacts:
Arthur Stril, Chief Business Officer, +1 (347) 809 5980, investors@cellectis.com
Ashley R. Robinson, LifeSci Advisors, +1 (617) 430 7577
Bing C. Wang, Chief Financial Officer, +1 (408) 515 8229
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FAQ
What is the purpose of the drawdown of the second tranche of €15 million by Cellectis?
What are the terms of the Tranche B Warrants issued to the EIB?
What is the total number of shares issuable upon exercise of the Tranche B Warrants?
What are the terms of maturity and interest for Tranche B?
What are the conditions for the company to drawdown a third tranche under the Finance Agreement?
