Aug 2 2010
Aradigm Corporation (OTCBB:ARDM) (the "Company") today announced that it has entered into a Stock Purchase Agreement providing for the issuance by the Company of 26 million shares of the Company's common stock to Novo Nordisk A/S ("Novo Nordisk") in a private placement as consideration for the termination of a promissory note in favor of Novo Nordisk under which approximately $9.1 million is currently outstanding, representing an effective price per share of $0.3505.
“Upon the closing of this transaction, we will have eliminated all debt from our balance sheet. We are appreciative of the support and cooperation we received from Novo Nordisk in executing this agreement.”
The closing of the private placement is subject to the Company's receipt of shareholder approval to increase the number of authorized shares of the Company's common stock and other customary closing conditions. Aradigm will be required, among other things, to file a resale registration statement within 30 days following execution of the agreement that covers the resale by Novo Nordisk of the shares. Aradigm may satisfy its registration obligations by including the shares in the same registration statement covering the shares related to the private placement that was previously announced by Aradigm on June 21, 2010.
The promissory note represented a loan that was made by Novo Nordisk to the Company in 2006 in the principal amount of $7.5 million, with interest accruing at 5% per annum. The principal, along with the accrued interest, was payable in three equal payments of approximately $3.5 million in 2012, 2013 and 2014.
Igor Gonda, President and Chief Executive Officer of Aradigm stated, "Upon the closing of this transaction, we will have eliminated all debt from our balance sheet. We are appreciative of the support and cooperation we received from Novo Nordisk in executing this agreement."