PHILADELPHIA, Dec. 16 /PRNewswire-FirstCall/ -- AVAX Technologies, Inc. (Pink Sheets: AVXT) ("AVAX" or the "Company") today announced that it recently closed a bridge loan financing (the "2009 Financing") pursuant to a Convertible Note and Warrant Purchase Agreement (the "Agreement") with Firebird Global Master Fund, Ltd., ("Firebird"). Pursuant to the Agreement, the Company sold a convertible promissory note, due June 30, 2010, in the aggregate principal amount of US$1,400,000, and issued a warrant to purchase an aggregate of 93,333,333 shares of the Company's common stock, par value $0.004 per share. Assuming the conversion of all shares underlying its convertible securities and the exercise of its warrants, Firebird would control a majority voting interest in the Company and it currently has a majority beneficial interest in AVAX.
The proceeds of the 2009 Financing are being used: (i) for working capital; (ii) to recertify and operate AVAX's vaccine manufacturing facility in Philadelphia, PA; and (iii) to pursue a recapitalization in an amount that would enable AVAX to undertake a planned interim assessment in connection with its pivotal Phase III clinical trial of M-Vax® for the treatment of Stage IV melanoma. M-Vax® has been designated as an orphan drug by the Food and Drug Administration ("FDA") and AVAX has reached agreement with the FDA under its Special Protocol Assessment for eligibility to receive accelerated approval of M-Vax®.
The Company has also announced the addition of two additional Board members: Howard S. Fischer, a former portfolio manager/research analyst with Silverback Asset Management's Life Sciences fund and previously a senior investment banker with UBS Global Healthcare Investment banking, and Anne T. Kavanagh, former head of healthcare investment banking at PaineWebber and Prudential Securities, CEO of Natwest Securities and a current Board of Directors member of Destination Maternity ( DEST).
John Prendergast, Chief Executive Officer and Chairman of the Company, stated, "We have always believed the data, science and economics surrounding M-Vax® to be compelling and we were disappointed in 2007 when the capital markets for cancer immunotherapies all but closed after the FDA did not approve Dendreon's Provenge®. While the clinical data surrounding our technology had proved to be promising, and only months before the FDA's Dendreon decision we raised $10 million in support of our clinical program, we were forced thereafter to substantially scale back operations because of financing considerations. We are grateful for Firebird's continued support, which will provide us the opportunity to pursue a capital raise allowing us to conduct our pivotal Phase III M-Vax® trial to its planned interim assessment point. Recent and anticipated news by companies involved with cancer vaccines and immunotherapies has resulted in renewed interest in the sector by institutional investors, larger pharma, biotechnology companies and the medical and scientific communities at large. We believe that once AVAX is reintroduced to those involved in our industry, they will find the opportunities presented by the Company to be quite compelling." Dr. Prendergast further commented, "We are delighted to have Anne Kavanagh and Howard Fischer join our Board. Their backgrounds and capabilities will greatly assist the Company reach its next important set of milestones, and to reestablish itself in the capital markets."
The 2009 Financing triggered the anti-dilution provisions in the definitive agreements from a 2008 bridge funding involving the sale of convertible promissory notes and warrants ("the 2008 Financing") to certain accredited investors (including Firebird) and current and then existing insiders of the Company. The Company now has approximately 143 million common shares outstanding. This number does not include approximately 564 million common shares underlying convertible securities and the exercise of all outstanding options and warrants, which assumes an amendment to the Company's charter to increase the number of authorized shares. The holders of the notes issued in the 2008 Financing have agreed to extend the maturity date of those securities to June 30, 2010.
There is no assurance that the capital obtained in the 2009 Financing will be sufficient for its intended purposes. In particular, there can be no assurance that Company will successfully obtain required additional capital, or, if that if obtained, the amounts will be sufficient to fund current or anticipated operations, including, but not limited to, its anticipated pivotal Phase III trial for M-Vax®. The inability to secure additional capital would have a material adverse effect on the Company, and it is probable that in such eventuality the Company would lose control of its manufacturing facilities and intellectual property, be forced to cease operations and potentially seek bankruptcy relief. If the Company discontinues its operations, it will not have sufficient funds to pay any amounts to its stockholders.
The Note and the Warrant were sold without registration under the Securities Act of 1933, as amended (the "Act") and may not be resold unless subsequently registered under the Act or pursuant to an exemption from registration under the Act.
About AVAX Technologies, Inc.
AVAX Technologies, Inc. is a biotechnology company with operations in the United States and France. The Company is engaged in the research and clinical and commercial development of biological products and cancer therapeutics. The Company's AC Vaccine platform is a therapeutic cancer vaccine.
Certain statements in this release are "forward-looking" statements that are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements involve significant risks and uncertainties, and in light of the significant uncertainties inherent in such statements, the inclusion of such information should not be regarded as a representation by the Company that the objectives and plans of the Company will be achieved. In fact, actual results could differ materially from those contemplated by such forward-looking statements. These statements include, but are not limited to, the Company's immediate need to obtain additional funding to continue to finance the Company, the Company's plans, objectives, projections, expectations and intentions such as those relating to the future development of M-Vax® and other vaccines. The Company does not undertake any obligation to release publicly any revisions to these forward-looking statements or to reflect the occurrence of unanticipated events.
Media contact: Jamie Bittenbender +1-215-241-9760
SOURCE AVAX Technologies, Inc.
|SOURCE AVAX Technologies, Inc.|
Copyright©2009 PR Newswire.
All rights reserved