CALGARY, July 23, 2014 /CNW/ - Zenith Epigenetics Corp. ("Zenith" or the "Company") today announced that it has closed a private placement of 4.3 million common shares at a price of US$1.00 per share for gross proceeds of CAD$4.6 million (the "Private Placement"). NGN BioMed Opportunity II, L.P. ("NGN") subscribed for 1,000,000 common shares. The shares are subject to a four month hold period.
After giving effect to the Private Placement, NGN holds 11,103,004 common shares of Zenith, representing approximately 12.2% of Zenith's issued and outstanding common shares. NGN also holds 350,000 common share purchase warrants of Zenith.
Pursuant to the terms of the Private Placement, in the event that Zenith completes an equity financing within 18 months and the price per share is lower than US$1.00, the price per share paid by the subscribers to the Private Placement will be adjusted to the lower price per share and they will, accordingly, receive additional common shares for no additional consideration.
The Private Placement was a related party transaction within the meaning of applicable Canadian securities laws as NGN is an insider of Zenith. The transaction was exempt from the formal valuation and minority approval requirements applicable to related party transactions on the basis that the value of the transaction was less than 25 percent of Zenith's market capitalization, as determined by the Board of Directors of the Company. Zenith did not file a material change report more than 21 days prior to closing as contemplated by the related party transaction requirements as the insider participation was only recently confirmed.
Zenith intends to use the net proceeds from the offering to fund research and development activities, general and administrative expenses, increased working capital and for other general corporate purposes.
The securities issued under the offering have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities laws, and accordingly, may not be offered or sold within the United States except in compliance with the registration requirements of the U.S. Securities Act and applicable state securities requirements or pursuant to exemptions therefrom. This press release does not constitute an offer to sell or a solicitation of an offer to buy any of Zenith's securities in the United States.
About Zenith
Zenith Epigenetics Corp. is a clinical stage biotechnology company focused on the discovery and development of novel therapeutics by applying its proprietary epigenetics platform. Zenith's bromodomain (BET) inhibitors are being advanced in several oncology indications and have the potential to impact multiple additional diseases as well.
SOURCE Zenith Epigenetics Corp.
