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VALENCIA, Calif. (AP) -- Biopharmaceutical company MannKind Corp. said it signed a new $350 million loan agreement with Chief Executive and Chairman Alfred E. Mann, its principal stockholder. Under terms of the agreement, the credit is available until Dec. 31, 2009, and MannKind will be required to repay any borrowings under this arrangement by Dec. 31, 2011. Advances are unsecured and will bear interest at the London interbank offered rate, or LIBOR, plus 3 percent, the company said. At any time after Jan. 1, 2010, Mann can require MannKind to prepay up to $200 million in advances that have been outstanding for at least 12 months. This new loan replaces the $150 million loan agreement with Mann previously in place. Combined with proceeds from registered direct stock offerings announced today, the loan will enable the company to advance its Technosphere Insulin program and fund operations through the third quarter of 2009, MannKind said. In addition to the loan, Mann has invested $566 million in the company to date. As of June 30, Mann beneficially owned about 32.7 million shares, or a 44.5 percent stake, in the company. MannKind shares jumped $1.12, or 11.9 percent, to $10.53 in afternoon trading.
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