NEW YORK (GenomeWeb News) - Health Discovery Corporation said today that it expects to raise between $1.5 million and $2.5 million through a stock purchase agreement with several unnamed financial institutions and "other accredited investors.”
Two of these investors have agreed to sit on the company’s board upon closing, which is expected on or before Sept. 7, HDC said.
The company also said that its current note holders plan to convert around $2 million of its existing debt into equity.
Separately, the company disclosed in a filing with the US Securities and Exchange Commission today that its revenues for the three months ended June 30 dwindled to $10,834 from $70,000 in the prior-year period. All of the company’s revenues are from licensing and development fees.
HDC’s net loss widened to $739,290 from $493,235 in the second quarter of 2006.
As of June 30, HDC had $65,558 in available cash.
Company CEO Stephen Barnhill said in a statement that the combination of the private placement and converted debt "will give us a completely restructured balance sheet."
HDC said in its quarterly report that it expects to have reduced its indebtedness to $647,422 and to have a cash balance of around $2.6 million following the private placement.
"The resulting financial strength will allow us to fuel our biomarker discovery efforts, increase the pace of our licensing and development opportunities with our collaborative partners, and continue the enhancement and protection of our valuable patent estate," Barnhill said.