Conduit Pharmaceuticals Inc. (NASDAQ:CDT), a pharmaceutical company, has amended its financial obligations under a convertible promissory note, according to a recent SEC filing. The original note, issued to Vrezh Isayan and Sharon Lee Isayan on March 20, 2023, with a maturity date of September 20, 2024, was in the principal amount of $800,000.
The note accrued interest at 20% per annum, with interest payments due every six months and the option for the payees to convert the principal and accrued interest into common stock at $10 per share.
On October 9, 2024, Conduit Pharmaceuticals reached an agreement with the payees to amend the note. The amendment extended the maturity date to October 20, 2024, with potential further extensions to November or December 2024. The company also agreed to issue $80,000 worth of common stock for accrued interest as of September 30, 2024, at the market price on the day before issuance, and an additional 2,000,000 shares of common stock.
In accordance with the amendment, on October 11, 2024, the company issued a total of 2,781,250 shares of common stock to satisfy the obligations outlined in the amendment. The amendment waived the previously payable interest and principal, now due on the new repayment date.
In other recent news, Conduit Pharmaceuticals has made significant strides in securing its financial future and expanding its intellectual property portfolio. The company recently entered into a financing agreement with Nirland Limited, securing $2.65 million through a Senior Secured Promissory Note. This arrangement includes the issuance of 12.5 million shares of common stock to the purchaser and carries an annual interest rate of 12%.
Further, Conduit Pharmaceuticals has achieved a crucial milestone by securing a composition of matter patent from IP Australia for its HK-4 Glucokinase Activator, AZD1656. The patent provides up to 20 years of protection, bolstering the company's intellectual property portfolio.
However, the company has been notified by Nasdaq of non-compliance with certain listing requirements, potentially leading to the delisting of its common stock. To address this, Conduit Pharmaceuticals has been given a 180-day grace period to meet the minimum market value requirements and has formed committees to review share dispositions and investigate stockholder trading patterns.
Additionally, the company has rescheduled its 2024 Annual Meeting of Stockholders from October to December 18, 2024. This decision was deemed necessary by the Board of Directors in the best interest of the stockholders.
InvestingPro Insights
Recent InvestingPro data sheds light on Conduit Pharmaceuticals Inc.'s (NASDAQ:CDT) financial position, providing context to the company's recent amendment of its convertible promissory note. With a market capitalization of just $10.44 million, CDT is operating in a challenging environment. The company's adjusted operating income for the last twelve months as of Q2 2024 stands at -$8.53 million, indicating significant operational losses.
InvestingPro Tips highlight that CDT is "quickly burning through cash" and "not profitable over the last twelve months," which aligns with the company's need to restructure its debt obligations as detailed in the article. The tip that CDT "operates with a moderate level of debt" further contextualizes the importance of the note amendment for the company's financial management.
The stock's performance has been notably poor, with a 93.82% decline over the past year. This steep drop in share price likely influenced the company's decision to issue additional shares as part of the debt restructuring, potentially leading to further dilution for existing shareholders.
For investors seeking a more comprehensive analysis, InvestingPro offers 11 additional tips for CDT, providing a deeper understanding of the company's financial health and market position.
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