Pivotal Therapeutics to close equity portion of financing; Enters
into $5,000,000 debt financing agreement
WOODBRIDGE, ON, Oct. 2, 2013 /PRNewswire/ - Pivotal
Therapeutics Inc. (OTCQX: PVTTF) (CNSX: PVO), a specialty
pharmaceutical company with a focus on Omega-3 therapies
for cardiovascular disease (CVD) and overall health, announces
entering
into a CDN $5,000,000 Convertible
Promissory Note led by Crossover
Healthcare Fund LLC, a U.S. institutional fund, as a continuation
of
its non-brokered private placement. To date the equity financing
raised
gross proceeds of CDN $2,741,809. The
financing will continue through
issuance of Convertible Promissory Notes for up to an additional
CDN
$5,000,000, which will go towards
increasing the Company's sales and
marketing efforts. The Notes are convertible at CDN $0.25 per share
and, when closed, the combined proceeds from the financing will be
in
excess of CDN $7,700,000.
Debt Financing Portion
The Company is pleased to announce that it has entered into an
agreement
with institutional investors to raise CDN $5,000,000 through
Convertible Promissory Notes and warrants led by Crossover
Healthcare
Fund, LLC. The funds raised will be used to expand sales and
marketing,
advance ongoing clinical trials, and for general working
capital,
including business development. The closing of transactions are
subject
to the satisfaction of customary closing conditions and are
expected to
occur on or about October 31,
2013.
Under the terms of the debt agreement, the investors will purchase
units
consisting of CDN $1,000 of
Convertible Promissory Notes (the "Note" or
"Notes") and warrants to purchase 1,200 shares of common stock of
the
Company (the "Warrants"). The maturity of the Notes is two (2)
years
from the date of issuance. Investors may convert their Notes
into
common shares for CDN $0.25 per share
at anytime prior to maturity. The
Notes will accrue interest at a rate of 8% per annum, due and
payable
quarterly with the first payment due three months from the date
of
issuance. The Company may, at its discretion, pay the interest
in
either cash or common shares of the Company; valued at the greater
of
CDN $0.25 per share and such price as
may be allowed under Canadian
National Stock Exchange (CNSX) Policy. Each Warrant will represent
the
right to purchase shares of common stock of the Company at a price
of
CDN $0.30 per share. The Warrants
shall be exercisable after the date
of issuance and shall expire five (5) years after the date of
issuance.
Equity Financing Portion
The equity portion of the private placement has raised gross
proceeds of
CDN $2,741,809 representing
12,462,768 units at a price of CDN $0.22
per unit. Each unit consists of one common share and one-half
purchase
warrant. The terms of the purchase warrants have been revised from
an
expiry of 24 months to 60 months following the closing of the
equity
portion of the private placement. The warrant exercise price has
been
revised from CDN $0.50 per common
share to $0.30 per common share.
Each
full purchase warrant may be exercised to purchase one common share
of
the Company upon payment of the exercise price of CDN $0.30 per common
share. The purchase warrants may be called by the Company at any
time
after six months following the closing, provided the common shares
of
the Company have traded at a price of at least CDN $0.45 for 20 trading
days within a 30 consecutive day trading period. This call-price
has
been revised from CDN $0.75 to CDN
$0.45.
"The funds we have raised to date have allowed the Company to
move
forward with its sales and marketing initiatives and increase
awareness
of our lead product VASCAZEN® across the U.S."
stated Mr. Eugene Bortoluzzi, Chief
Executive Officer. "Together with
the additional funds and the new clinical data from the
VASCAZEN® - REVEAL trial, Pivotal will continue
to communicate to the medical community the benefits of correcting
an
Omega-3 deficiency in cardiovascular patients by prescribing
VASCAZEN®."
"We are pleased to have a quality, healthcare focused
institutional
partner who sees the potential in our business strategy and the
unique
offerings VASCAZEN® brings to the market," stated
Ms. Rachelle MacSweeney, President
and
Chief Operating Officer. "Crossover's continued support in Pivotal
is
further exemplified by their commitment to raise over CDN
$7.7 million
for the Company."
Please refer to the Company Form 9 Filings on the CNSX website
(www.cnsx.ca) for detailed updates with regards to the
financing.
About VASCAZEN®
VASCAZEN® is currently available in the U.S. as a
prescription only Medical Food
specifically formulated for the dietary management of an
Omega-3
deficiency in cardiovascular patients. VASCAZEN®
is a >90% pure Omega-3 with a proprietary 6:1 EPA:DHA fatty
acid
formulation, protected by a series of both U.S. and foreign
patents. .
VASCAZEN® has been clinically shown to correct an
Omega-3 deficiency within eight
weeks of treatment with positive concomitant effects on the
lipid
profiles, mainly a 48% reduction of triglycerides and an increase
of
HDL without negative impact on the LDL-C lipid profile.
VASCAZEN®'s results were achieved with a dose of
3 grams of EPA and DHA per day
of a prescription grade, high purity Omega-3.
About Pivotal Therapeutics Inc.
Pivotal Therapeutics is a publicly traded (OTCQX: PVTTF) (CNSX:
PVO)
specialty pharmaceutical company with a focus on cardiovascular
disease
and overall health. Pivotal Therapeutics' lead product
VASCAZEN® is a prescription only Medical Food
formulated to meet the dietary
Omega-3 deficient needs of patients with cardiovascular disease
through
elevating Eicosapentaenoic acid (EPA) and Docosahexaenoic acid
(DHA) to
levels associated with reduced risk of cardiovascular
complications. OMAZENTM is a pharmaceutical grade
Omega-3 providing over 90% pure Omega-3 in
each capsule for the maintenance of good health.
OMAZENTM is a patented product available for sale
and distribution in Canada.
Disclosure Notice
The information contained in this document is as of October 2, 2013.
This press release contains forward-looking statements. Such
forward-looking statements are subject to a number of risks,
assumptions and uncertainties that could cause Pivotal's actual
results
to differ materially from those projected in such
forward-looking
statements. These statements can be identified by the use of words
such
as "will", "anticipate", "estimate", "expect", "project",
"forecast",
"intend", "plan", "believe", "project", "potential", and
similar
expressions with any discussion of future operating or
financial
performance or events. In particular, factors that could cause
actual
results to differ materially from those in forward looking
statements
include the following: Pivotal's inability to obtain additional
financing on acceptable terms; growth in costs and expenses;
inability
to compete with others who provide comparable products; risk that
the
Company's products will not gain widespread market acceptance;
risks
relating to the Company's ability to maintain its CSNX listing.
Forward-looking statements speak only as of the date made and are
not
guarantees of future performance. The Company undertakes no
obligation
to publicly update or revise any forward-looking statements
contained
in this document as a result of new information or future events
or
developments. CNSX has not reviewed and does not accept
responsibility
for the adequacy or accuracy of this information.
SOURCE Pivotal Therapeutics Inc.