Kraig Biocraft Laboratories in Ann Arbor, which develops and distributes genetically engineered spider silk-based fibers for commercial and military markets, has signed an agreement with the University of Notre Dame in Indiana to increase the university’s equity position in the company.
Under the agreement, the university has converted a portion of the moneys owed to it by the company to common stock. The remaining balance owed to the university has been converted into a note that is payable over the course of two years.
“We have been working with Notre Dame on this deal for quite some time,” says Jon Rice, COO of Kraig Labs. “Today, we are pleased to report that, having now finalized this agreement, they have nearly tripled their equity position in the company. The deal has strengthened the company’s balance sheet and, in conjunction with the equity financing announced Monday, improves our financial position, as we move towards larger scale production.”
Kraig Labs has worked with the university for 10 years to develop its spider silk technologies.
“The Notre Dame IDEA Center is excited by the commercial prospects in front of Kraig Biocraft and is pleased to be able to conclude this most recent agreement, which gives Kraig some additional runway to continue its development of commercial spider silk products,” says Richard Cox, director of licensing and business development at Notre Dame.
In related news, last week Kraig Labs closed a $1-million round of private financing to fund expansion of its recombinant spider silk production in Vietnam, support its research operations, improve its balance sheet, and support other corporate initiatives.
“Securing this bridge financing was a key piece to funding the company’s commercial expansion strategy and puts us in a strong position. As we expand spider silk production, we shift operational focus to production,” says Rice. “This capital is necessary to support commercial expansion, which is essential in establishing market channel collaborations for consumer products.”