- Thinly traded nano cap Protalix BioTherapeutics (NYSE:PLX -33.2%) slumps on almost a 4x surge in volume in early trading in response to the company's announcement of an exchange of convertible debt in a private placement.
- The agreement, announced after the close yesterday, calls for the exchange of $54.1M aggregate principal amount of the company's outstanding 4.50% Senior Convertible Notes due 2018 for $40.2M of newly issued 7.50% Senior Secured Convertible Notes due 2021.
- Concurrently, it has agreed to sell $22.5M of the 2021 Notes to qualified investors. Both transactions should close by December 7.
- The 2021 Notes will be secured by perfected liens on Protalix's material assets. The 7.50% interest will be paid semi-annually and, in certain circumstances, the company may elect to pay up to 1.25% of the interest in shares of common stock. The Notes will mature on November 15, 2021.
- The initial conversion rate will be 1,176.4706 common shares per $1,000 principal amount of the Notes (~$0.85 per share).
- Net proceeds will fund clinical trials, R&D, working capital and general corporate purposes.