Eterna completes $8.7M convertible debt financing

Eterna Therapeutics announced the execution and closing of the sale of approximately $8.7 million aggregate principal amount of senior convertible promissory notes and accompanying warrants to purchase common stock in a private placement transaction that closed on July 14, 2023 and was priced at-the-market under Nasdaq rules. The notes, which were issued at par, bear interest at a rate of 6.0% per year, payable quarterly, and mature in July 2028 unless earlier redeemed, repurchased or converted in accordance with their terms. At its election, the Company may pay interest in cash or in-kind by increasing the outstanding principal amount of the notes. The notes may be converted from time to time in whole or in part into shares of Eterna common stock at a conversion price of $2.86 per share, subject to customary adjustments for stock splits, stock dividends and recapitalizations. The notes do not contain any ratchet or other financial antidilution provisions. Each purchaser of the convertible notes received warrants to purchase 200% of the number of shares of Eterna common stock into which such purchaser’s note is initially convertible. The warrants are immediately exercisable, have an exercise price of $2.61 per share and expire in July 2028. Mr. Brant Binder and Dr. Richard Wagner, current directors of the Company, and former directors, Mr. Charles Cherington and Mr. Nicholas Singer, participated in the private placement on the same terms and subject to the same conditions as all other purchasers.