EpiCept Corporation (Nasdaq OMX Stockholm Exchange and OTCQX: EPCT)
announced today that it has amended the Company's Loan and Security
Agreement with MidCap Financial, LLC ("MidCap" or the "Lender")
effective August 27, 2012.
Pursuant to the terms of the amendment, EpiCept has made a principal
prepayment of $1.2 million, which approximates the scheduled principal
payments due under the Loan and Security Agreement from September 1,
2012 through December 31, 2012. As a result of the prepayment, the
current principal balance of the loan is $4.1 million. The next
principal payment is due on January 15, 2013, and regularly scheduled
monthly principal payments will commence February 1, 2013 until the
scheduled maturity of the loan in March 2014. The Company will continue
to make monthly payments of interest to the Lender as per the Loan and
Security Agreement.
EpiCept also agreed, pursuant to the amendment, to maintain a cash
balance of $1.1 million in a bank account that is subject to the
security interest maintained by MidCap under the loan agreement.
Further, the Company has committed to signing a definitive agreement,
acceptable to MidCap, by October 15, 2012 with respect to a sale or
partnering transaction and to consummate such a transaction as soon as
is practical but in any event no later than January 15, 2013.
"This amendment is consistent with our current plans to complete a
transaction and leaves us with cash availability similar to what we had
prior to the amendment," remarked Robert Cook, EpiCept interim President
and CEO. "While we cannot be certain that an acceptable transaction can
be completed according to this timetable or at all, we are intently
focused on concluding a transaction within the deadlines set forth in
the amendment."