February 17, 2009: 08:00 AM ET

Cleveland BioLabs, Inc. (NASDAQ: CBLI) (the “Company”) announced today that it has raised approximately $1,700,000 in capital through a private placement of approximately 170 shares of series D convertible preferred stock, with a stated value of $10,000 per share (“Series D Preferred”), and warrants to purchase an aggregate of 919,876 shares of the Company’s common stock. The Company intends to use the proceeds of the private placement for working capital purposes. The Company is continuing with efforts to raise additional capital on the same terms and conditions.

The Series D Preferred does not accrue dividends, ranks junior to the Company’s Series B Convertible Preferred Stock and senior to all shares of Common Stock and other capital stock of the Company and is redeemable or convertible by the Company commencing on February 13, 2012 (subject to various conditions). Initially, each share of Series D Preferred is convertible into approximately 5,405.5 shares of Common Stock at the initial conversion price of $1.85. The conversion price is subject to automatic reduction in a fixed amount on a periodic basis (commencing on August 13, 2009) and also is subject to reduction if certain scientific milestones are not met by the Company. The warrants have a seven-year term and an initial exercise price of $2.60.

At its annual meeting of stockholders, the Company intends to seek approval of various matters relating to the transaction. Directors, executive officers and certain large stockholders of the Company who together hold approximately 29.3% of the total voting power of the outstanding capital stock of the Company eligible to vote as of the date of the issuance have agreed to vote in favor of these approvals.

The Company intends to file a Current Report or Form 8-K with the Securities and Exchange Commission today, which will include a more detailed description of the transaction.

http://money.cnn.com/news/newsfeeds/articles/marketwire/0474308.htm

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