It was announced today, that CEL-SCI Corporation (NYSEMKT:CVM) has entered into a definitive agreement with institutional investors, for an offering of common shares, which will be equivalent to $1 million in proceeds from registered direct offering.
The company did also reveal alongside this, that this offering will close on February 23, 2017. However, this will still be applicable to the relevant regulations and their requirements for such an operation.
How CEL-SCI Nasdaq Stock will be distributed due to this definitive agreement
As per the definitive agreement between CEL-SCI and the institutional investors, 10 million registered Nasdaq stock shares of common stock, will be sold to the investors at a price of $0.10 per share.
However, this is not the end of the road, when it comes to detail in this deal. Additionally, the company has set up a private placement, which means that for each common share, which investor purchases, said investor also receives an unregistered warrant to purchase an additional share of common stock.
However, these warrants are priced at $0.12 per share. Furthermore, the warrants are only eligible for use, six months following the anniversary date of the investment. Lastly, it was also ruled that five and a halfyears following this deal, the warrants would become ineffective.
The reason behind the need for this investment
CEL-SCI is an entity, which is responsible for the development of various medical devices, which are aimed to induce an effective strategy for the body’s immune system to fight against various diseases, and illnesses, such as Cancer.
However, these drugs and development processes can be costly to the company, which is the reason that investments like this are compulsory, in order to ensure that the company can continue to develop and experiment with its drugs.