Rockley Photonics (NYSE:RKLY) announced today that it entered into agreements for an $81.5 million private placement.
Participating investors agreed to purchase $81.5 million in convertible senior secured notes (due 2026) and warrants to purchase 26.5 million Rockley ordinary shares at an exercise price of $5 per share, subject to certain anti-dilution adjustments.
Warrants purchased in the placement will expire 10 years from the date of issuance. Oxford, England-based Rockley Photonics said in a news release that it plans to grant the initial purchasers of the notes an option to buy up to an additional $81.5 million in notes and warrants. The notes will bear cash interest at a rate of 9.5% per annum.
If Rockley elects to pay interest partially in cash and partially through the issuance of additional notes, at a rate of 5.75% payable in cash and 6.25% payable in kind through the issuance of additional notes. They will be convertible at an initial conversion price equal to $3.08 per ordinary share and will mature on four years from the date of closing unless redeemed, repurchased or converted prior to such date.
Rockley, which expects the transaction to close on May 23, plans to use the proceeds from the sale along with other liquidity sources to continue developing its biosensing platforms for mobile health monitoring. Additionally, proceeds will be used for the repayment of approximately $24.9 million of existing debt and for general corporate purposes.