Aradigm announces $5 million private placement

Jun 21 2010

Aradigm Corporation (OTCBB:ARDM) (the "Company") today announced that it has entered into a definitive agreement for the sale of common stock and warrants to three existing shareholders and one new investor in a private placement for aggregate gross proceeds of approximately $5 million. The closing of the private placement is subject to the satisfaction of customary closing conditions.

Under the terms of the agreement, Aradigm has agreed to sell an aggregate of 34,702,512 shares of common stock at a price of $0.1184 per share and warrants to purchase an aggregate of 7,527,215 shares of common stock which become exercisable at an exercise price of $0.1184 per share upon the Company's receipt of shareholder approval to increase the number of authorized shares of the Company's common stock. The warrants include a mandatory exercise provision whereby the Company has the right to require the holder to exercise the warrant following the Company's receipt of such shareholder approval. After deducting for fees and expenses, the net proceeds from the sale of the shares of common stock are anticipated to be approximately $3.7 million and the net proceeds from the exercise of the warrants following the Company's receipt of such shareholder approval are anticipated to be approximately $0.9 million.

Aradigm will be required, among other things, to file a resale registration statement within 30 days following the closing that covers the resale by the purchasers of the shares and the shares issuable upon exercise of the warrants.

Igor Gonda, President and Chief Executive Officer of Aradigm stated, "We are very pleased with the support of our shareholders in this private placement and we welcome our new investor. These proceeds will enable us to take further steps in the development of our lead product candidate, inhaled liposomal ciprofloxacin, required for Phase 3 studies and filing a new drug application (NDA)."

Ladenburg Thalmann & Co. Inc., a subsidiary of Ladenburg Thalmann Financial Services Inc. (NYSE AMEX: LTS), acted as the sole placement agent for this offering.