Chromos announces bought deal private placement


    BURNABY, BC, March 21 /CNW/ - Chromos Molecular Systems Inc. (TSX: CHR)
announced today that it has entered into an agreement with a syndicate of
underwriters led by Dundee Securities Corporation and including Canaccord
Capital Corporation (the "Underwriters") pursuant to which the Underwriters
have agreed to buy 40,000,000 Units (the "Units") from Chromos on a bought
deal basis at a price of $0.10 per Unit. Each Unit consists of one common
share of Chromos and one common share purchase warrant, each whole warrant
being exercisable to acquire an additional common share of Chromos at a price
of $0.15 per share for 60 months from closing of the offering.
    The gross proceeds raised from the bought deal private placement will be
$4,000,000. Units will be offered in Canada by private placement, and in such
other jurisdictions, including the United States and Europe, where the Units
can also be offered and sold in accordance with applicable exemptions from any
prospectus, registration or other similar requirements.
    Chromos intends to use the net proceeds principally to fund the
commercialization and expansion of its cell line engineering business, the
repayment of Chromos' bridge loan financing, and for the shared development of
its lead product, CHR-1103. The balance will be allocated to working capital
and other general corporate purposes.
    The offering is scheduled to close on or about April 6, 2007. The closing
of this offering is subject to certain conditions including all necessary
regulatory, stock exchange and shareholders approvals. Chromos intends to
apply for an exemption from the Toronto Stock Exchange from the requirement to
seek shareholders approval in connection with the financing pursuant to
Section 604(e) of the TSX Company Manual on the basis of financial hardship. A
special committee of the Board of Directors of Chromos (the "Board") composed
of Darrell Elliott and Roger Flowerdew, each of whom is free from any interest
in this offering and is unrelated to any of the parties involved in the
offering, has determined that Chromos is in financial difficulty and
recommended that Chromos proceed with the offering. Based on this
recommendation, the Board has determined that Chromos is in serious financial
difficulty, that the offering is designed to improve its financial position
and is reasonable in the circumstances, and the Board has approved the
    Upon closing Chromos will pay customary commissions and issue up to
4,000,000 warrants to the Underwriters. These warrants will entitle the holder
to purchase one Unit within 2 years of the date of closing at a price of $0.10
per Unit.
    Up to 88,000,000 common shares are issuable under this transaction,
representing 99% of the currently issued and outstanding common shares. All
securities issued as part of this Unit offering are subject to a four-month
hold period. This transaction is not expected to have a material affect on
    The securities offered have not been and will not be registered under the
U.S. Securities Act of 1933, as amended, and may not be offered or sold in the
United States absent registration or an applicable exemption from the
registration requirements. This press release shall not constitute an offer to
sell or the solicitation of an offer to buy nor shall there be any sale of the
securities in any State in which such offer, solicitation or sale would be
    This press release shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of the securities
in any jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws of
any such jurisdiction.

    About Chromos

    Chromos is a biopharmaceutical company with two drug development programs
focused on inflammatory diseases and thrombotic disorders. The Company's lead
product, CHR-1103, is a humanized monoclonal antibody being developed as an
acute treatment for relapses associated with multiple sclerosis (MS). Chromos
generates revenue from its proprietary ACE System technology to engineer
production quality cell lines to manufacture biopharmaceutical products
including monoclonal antibodies. For more information, please visit

    Forward-Looking Statements

    This release may contain forward-looking statements which involve known
and unknown risks, uncertainties and other factors beyond management's control
which may cause the actual results, performance or achievements of Chromos
(the "Company"), or industry results, to be materially different from any
future results, performance or achievements expressed or implied by such
forward-looking statements.
    To the extent possible, management implements strategies to reduce or
mitigate the risks and uncertainties associated with the Company's operations.
Operating risks include (i) the continued availability of capital to finance
the Company's activities; (ii) the Company's limited cash position, (iii) the
ability to successfully obtain proof of the effectiveness of the Company's
technology (iv) the ability to complete and maintain corporate alliances,
including the proposed CHR-1103 collaboration, relating to the development and
commercialization of the Company's technology; (v) the ability to obtain and
enforce patent and other intellectual property protection for the Company's
technology; (vi) market acceptance of the Company's technology; (vii) the
competitive environment and impact of technological change; (viii) the
Company's ability to attract and retain employees to carry out its business
plans; (ix) the timely development and commercialization of any technology or
products that are contingent on the completion and maintenance of corporate
alliances with third parties; (*) the demand for repayment of the outstanding
notes by the note holders and (xi) regulatory approval of the conversion of
the outstanding notes. Further details on Chromos' operating risks can be
found in the Company's annual information form. The Company undertakes no
obligation to revise forward-looking statements in light of future events.

For further information:

For further information: Jeff Charpentier, CA, Vice President and CFO,
Tel: (604) 415-7132, e-mail:

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