Davis, California, USA
April 30, 2020
Marrone Bio Innovations, Inc. (Nasdaq: MBII) (the “Company” or “Marrone Bio”) an international leader in sustainable bioprotection and plant health solutions, has signed a warrant exchange agreement with existing institutional investors that immediately reduces the total number of outstanding warrants by approximately 35%, from 52.6 million to 36.5 million.
The warrant exchange transaction was entered into between the Company and existing investors Waddell & Reed, Ospraie Ag Science LLC, Ardsley Partners Renewable Energy Fund, L.P., National Securities Corporation and Ivan Saval.
Under the agreement, 46.0 million warrants have been exchanged for 29.9 million new warrants with an exercise price of $0.75 per share. The new warrants have five different expiration dates. Three of these warrant tranches have expiration dates throughout 2020 and will provide approximately $14.4 million in net proceeds if exercised in full, with the investors agreeing to exercise the first $2.5 million as of May 1, 2020. The other two warrant tranches have expiration dates in 2021 and will provide $8.1 million in net proceeds if exercised in full, for a total of approximately $22.4 million.
“This warrant exchange transaction is a win-win for all parties. The tranched structure of the warrant expiration dates is intentionally designed to provide funding when and as we will need it. Assuming full exercise, the warrants are expected to take the Company to cashflow breakeven under the Company’s current operational plan and will allow us to continue executing upon our growth plan, while significantly reducing our fully diluted shares outstanding. Specifically, this transaction will result in a 79.1% reduction in warrants outstanding at the end of 2020, and a 99.6% reduction in warrants outstanding by the end of 2021, thereby effectively eliminating any warrant overhang,” said Jim Boyd, President and Chief Financial Officer of Marrone Bio Innovations.
“The new economy as a result of the COVID-19 pandemic is going to present many challenges and opportunities. The impact of good stewardship of our shared world had never been more self evident. The uncertainty that this new economy presents has to be recognized and planned for and is why we moved quickly to complete this transaction. We feel privileged to be in a position to contribute and have investors who believe in our mission to help feed the world in a healthy and sustainable manner,” concluded Boyd.
“I speak on behalf of the Company’s three largest investors when I say that we are extremely pleased to be entering into this transaction. Together, we believe that Marrone Bio is incredibly well positioned to be a forerunner in the ongoing transition to sustainable agriculture. Biologicals will play a significant role in this transition and we believe that Marrone Bio has the products based upon best-in-class science to seize this opportunity,” added Jason Mraz, President of Ospraie Ag Science.
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