StemCells Closes $10 Million Debt Financing With SVB
StemCells, Inc. announced that it closed a $10 million debt financing from Silicon Valley Bank. The loan funds will be used for general corporate purposes, and increase the company’s December 31, 2013 pro forma cash balance to $34.4 million. This total also includes $2 million in net proceeds received subsequent to the end of the year from the exercise of warrants and the sale of shares of common stock.
“We are pleased to have secured this loan from Silicon Valley Bank,” said Martin McGlynn, president and CEO of StemCells. “These funds will extend our cash runway and provide us with increased financial flexibility. Sophisticated institutions like SVB are very careful and thoughtful when making their lending decisions, and we appreciate the confidence shown by SVB in our company.”
The loan has a three-year term and interest will accrue at 6% per annum. For the first six months, payments will be interest only and then the loan will be amortized over 30 months. In addition, there will be a final payment at the end of the term equal to $1 million. In connection with the debt financing, the Company also issued to SVB a warrant to acquire 293,531 shares of common stock with an exercise price of $1.7034 per share. The warrant will expire in ten years.
StemCells is engaged in the research, development and commercialization of cell-based therapeutics and tools for use in stem cell-based research and drug discovery.