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RedHill Biopharma Announces Definitive Agreement For $2.5 Million Private Placement From Broadfin Capital LLC

Stocks in this article: RDHL

TEL-AVIV, Israel, Dec. 31, 2013 (GLOBE NEWSWIRE) -- RedHill Biopharma Ltd. (Nasdaq:RDHL) (TASE:RDHL) (the "Company" or "RedHill"), an emerging Israeli biopharmaceutical company focused primarily on the development and acquisition of late clinical-stage, proprietary formulations and combinations of existing drugs, today announced that it has entered into a definitive agreement with Broadfin Capital LLC ("Broadfin") for the sale of RedHill's American Depository Shares ("ADSs") and warrants in a private placement transaction (the "Private Placement") for a sum of $2.5 million.

Proceeds from the financing will be used for general working capital and for research and development related purposes, including the clinical development of RedHill's lead gastrointestinal programs, RHB-104 for Crohn's disease and RHB-105 for H. pylori infection, both currently undergoing Phase III studies in the U.S.

The Private Placement is expected to close on or before January 11, 2014, subject to the satisfaction of certain customary closing conditions. The transaction is on the same terms as the terms agreed in the $6 million private placement transaction with OrbiMed Israel Partners Limited Partnership announced yesterday and described in RedHill's Report on Form 6-K submitted to the Securities and Exchange Commission (the "SEC") on December 30, 2013. Upon the closing of the Private Placement, in exchange for gross proceeds of $2.5 million, RedHill will issue Broadfin a total of 263,160 units, each consisting of one ADS 1 and a warrant to purchase 0.4 of an ADS ("Unit"), at a purchase price of $9.50 per Unit. RedHill will issue to Broadfin warrants to purchase 105,264 ADSs in the aggregate, which will have a three-year term and be exercisable at a price per ADS of $11.

The Units, ADSs and warrants offered in the Private Placement and the ADSs issuable upon the exercise of the warrants have not been registered under the Securities Act of 1933, as amended, or state securities laws, and may not be offered or sold in the United States unless such sale is made pursuant to an effective registration statement filed with the SEC or pursuant to an applicable exemption from SEC registration requirements. The Company has agreed to file a registration statement with the SEC covering the ADSs sold in the Private Placement and the ADSs issuable upon exercise of the warrants sold in the Private Placement.

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