LONDON (Alliance News) - Phorm Corp PLC on Thursday said it is yet to receive the money needed to settle a USD1.0 million equity subscription agreed with a US-based institutional investor, though it has received funds from FiveT Investment Management Ltd and Arminius Verwaltung AG under separate deals.
The advertising company said it has received a total of USD500,000 from FiveT and Arminius, with the provision of the funds evenly split between them. FiveT and Arminius have each been transferred 14.6 million shares, a figure which takes into account a loan conversion after receiving notices from Michael Bigger and Arminius for repayment.
FiveT is a company associated with Johannes Minho Roth, a non-executive director of Phorm. Roth is the founding director, chief executive officer and majority shareholder of FiveT's parent company, FiveT Capital Holding AG.
The company has received also USD250,000 through the draw down of the first tranche of a loan agreed with Meditor, a major shareholder in Phorm with just shy of a 23% stake. Meditor has agreed to provide up to USD2.75 million in total spread across three tranches.
Thanks to the completion of the subscription with FiveT and Arminius, Phorm has asked to draw down the next USD250,000 tranche.
Under the terms of the loan, the draw down of the first tranche resulted in an arrangement fee of 4.0 million new shares, which will now be issued to Meditor. A similar arrangement stands with regards to the second tranche.
Phorm is required to secure further equity funding of at least GBP2.5 million, at a price at or around its share price, by February 24 if it is to be able to draw down of the third and final USD2.25 million tranche of the loan.
Meanwhile, the US-based institution with which Phorm agreed a USD1.0 million equity subscription last month has failed to transfer the required funds to settle the deal under their legally binding agreement. Phorm said it is continuing to take legal advice over the matter.
Shares in Phorm closed down 12% at 1.10 pence on Thursday,
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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