New Jersey-based Celularity Inc. (Nasdaq: CELU) has closed an initial tranche of a private placement of senior secured convertible notes and warrants, raising over USD 10 million in gross cash proceeds as part of a broader recapitalization that contemplates up to USD 25 million in new capital and the restructuring of approximately USD 3 million in existing indebtedness, for a total recapitalization of up to USD 28 million. The financing follows a reduction in monthly cash burn of more than USD 1 million, personnel optimization, and a reallocation of resources toward revenue-generating activities.
The senior secured convertible notes mature 24 months from their respective issuance dates and bear interest at 10% per annum, compounded annually. Notes issued at the initial closing are initially convertible into Class A common stock at USD 1.50 per share, and accompanying five-year warrants are initially exercisable at the same price, providing eleven warrant shares for every twenty shares initially issuable upon conversion of the notes.
Celularity's stated use of proceeds centers on expanding revenue-producing manufacturing relationships, deploying existing cenplacel-L inventory, and increasing utilization of its Florham Park manufacturing facility.
Cenplacel-L is an investigational placenta-derived allogeneic cell therapy that Celularity intends to deploy through commercial relationships in permissive jurisdictions where supply and use are legally authorized, subject to applicable local regulatory requirements. Management estimates that existing cenplacel-L inventory represents approximately USD 40 million in potential sales value.