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Ista receives $65 million in funding
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IRVINE, Calif. — Ista Pharmaceuticals has entered into an agreement with long-standing shareholders Deerfield Management, Sprout and Sanderling Ventures to supply the company with up to $65 million in funding through a flexible credit facility, Ista announced in a press release.
Under the terms of the agreement, Deerfield Management, Sprout and Sanderling Ventures have already provided Ista with $40 million in financing and have committed up to $25 million in additional funding available for up to 1 year, the release said.
In conjunction with the first $40 million redemption, Ista plans to issue warrants for 12.5 million common shares at an exercise price of $1.41 per share at closing.
Ista will be able draw from the remaining $25 million in $5 million increments and will issue 500,000 warrants per $5 million drawn at a cost that is the higher of the market price of the stock at the time of the draw or $1.41 per share, according to the release.
If drawn in its entirety, the $65 million funding commitment will require Ista to issue a total of 15 million warrants, each of which will hold a 6-year term. These warrants will have anti-dilution protection that will be subject to exclusions for specific business development activities for all additionally issued common shares.
Any amounts drawn by Ista will accrue interest until maturity at an annual rate of 6.5% and will be payable on a quarterly basis in one-third increments in 2011, 2012 and 2013, the release said.
In addition, Ista has concluded its strategic performance review.