KALA BIO Announces Private Placement Agreement with Institutional Investors

KALA BIO, Inc. (NASDAQ: KALA), a clinical-stage biopharmaceutical company focused on innovative therapies for severe eye diseases, recently disclosed its entry into a Securities Purchase Agreement on December 29, 2024. As per the agreement, the company will privately issue common stock and Series I Convertible Non-Redeemable Preferred Stock to institutional investors, generating around $10.75 million in aggregate gross proceeds.

The Private Placement, set to finalize around December 31, 2024, entails the sale of 1,340,603 Common Shares at $6.44 per share and 3,286 Preferred Shares at $644.00 per share. Additionally, KALA BIO is obligated not to issue equity securities senior or on equal footing with the Series I Preferred Stock without prior approval from the Purchasers. Moreover, the company agreed to register the Common Shares and Conversion Shares for resale to Existing Purchasers upon demand under a Registration Rights Agreement dated March 2, 2023.

Furthermore, a Registration Rights Agreement was signed on the same day with Other Purchasers, necessitating the registration for resale of Registrable Securities within 30 days following the closing of the Private Placement. The company aims to keep the registration statement effective until all covered securities are sold or for a maximum of five years after the closing.

On December 30, 2024, KALA BIO submitted a Certificate of Designations outlining the rights, preferences, and privileges of the Series I Preferred Stock. Each share of Series I Preferred Stock is initially convertible into 100 Common Stock shares. The Series I Preferred Stock ranks senior to Common Stock, on parity with Parity Securities and junior to Senior Securities regarding distributions upon a Dissolution.

Subsequently, on the same day, the company issued a press release confirming the Private Placement, emphasizing the pivotal role of this financing event amidst their ongoing CHASE trial progress. With over 80% enrollment completion in the CHASE trial, KALA is on track to unveil topline data by the second quarter of 2025, marking a significant milestone for potential future submissions.

The financial implications foresee KALA BIO’s cash runways extending into the first quarter of 2026 post Private Placement closure. KALA intends to utilize proceeds for advancing KPI-012’s clinical development and meeting operational needs. The estimated outstanding Common Stock post-Placement is set at around 6,091,182 shares.

While this report captures the major aspects of the recent disclosures by KALA BIO, it is important to note that forward-looking statements and potential risks underline the company’s future trajectory. This comprehensive move seeks to fortify KALA’s financial position and propel its clinical programs towards upcoming milestones.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read KALA BIO’s 8K filing here.

KALA BIO Company Profile

KALA BIO, Inc, a clinical-stage biopharmaceutical company, engages in the research, development, and commercialization of innovative therapies for rare and severe eye diseases in the United States. The company's product candidates include KPI-012, which is in Phase 2b clinical trial for the treatment of persistent corneal epithelial defects.