WORCESTER, Mass. and TORONTO, June 1, 2011 /PRNewswire/ -- Generex Biotechnology Corporation (OTCBB: GNBT) (www.generex.com) today announced that it intends to dividend a portion of the shares it receives upon completion of a definitive licensing agreement to license its RapidMist™ buccal drug delivery technologies to Amarantus BioSciences, Inc. (www.amarantus.com), a California-based biotechnology company.
As announced on May 31, 2011, Generex has signed a binding letter of agreement. Amarantus will pay a license fee of $10 Million to Generex, which fee will be paid in Amarantus common stock valued at not less than $5 Million and a three-year promissory note upon completion of the definitive licensing agreement. In addition, the companies will jointly pursue the use of technologies developed by Amarantus for the treatment of diabetes mellitus. Management of Generex intends to dividend a portion of the Amarantus shares to its stockholders should Generex receive shareholder approval of a reverse stock split proposal and thereafter complete the reverse stock split. The reverse stock split proposal will be considered at the Generex annual meeting of its stockholders to be held on June 8, 2011. As stated in the proposal, if approved the reverse split will only be effected if Generex's application for listing on a U.S. national stock exchange is approved contingent only upon Generex meeting the minimum share price requirement of such exchange. Generex has not yet made application on to an exchange on those terms.
Assuming the reverse split is effected, the dividend is intended to take place only after reaching a definitive licensing agreement with Amarantus, issuance of the Amarantus stock to Generex, and after a registration statement contemplated to be filed by Amarantus covering the shares to be issued to Generex is declared effective. Generex management, along with the Generex Board of Directors, will evaluate the feasibility of declaring a dividend of the Amarantus shares to its stockholders should the reverse split not be effected.
The specific portion of the Amarantus stock shares to be subject of the dividend has not yet been determined by the Board of Directors, and will be subject to Delaware rules relating to impairment of capital, which may limit the number of Amarantus shares Generex may dividend to its shareholders. In addition, Generex can make no prediction on the inherent value of the Amarantus stock and, as Amarantus has only recently become traded on the OTCBB as the result of a "reverse merger," the price of its shares may fluctuate significantly.
Commenting on the announcement, Generex President & Chief Executive Officer Mark Fletcher stated: "Generex management sees a potential dividend of Amarantus shares to the Generex stockholders as a way of enabling them to directly benefit from our efforts to create new value from our existing assets. We are confident that should a reverse split be approved at our annual stockholders, meeting, we will have the ability to achieve greater financial flexibility through an up-listing. We hope this will be the first of many opportunities to create new value for our intellectual property portfolio and we intend to aggressively pursue such opportunities in the future."
About Amarantus BioSciences, Inc.
Amarantus BioSciences, Inc. is engaged in the research and development of first-in-class disease–modifying treatments that address the underlying cause of cell death, known as apoptosis, associated with a wide range of diseases, including but not limited to, neurodegenerative and cardiovascular. The Company's most advanced product candidate, MANF, is a therapeutic protein indicated for the treatment of Parkinson's disease and Myocardial Infarction. Currently incubating at the Parkinson's Institute in Sunnyvale, CA, Amarantus BioSciences is the recipient of a research grant from The Michael J. Fox Foundation for Parkinson's Research. See www.Amarantus.com.
About Generex Biotechnology Corporation
Generex is engaged in the research, development, and commercialization of drug delivery systems and technologies. Generex has developed a proprietary platform technology for the delivery of drugs into the human body through the oral cavity (with no deposit in the lungs). The Company's proprietary liquid formulations allow drugs typically administered by injection to be absorbed into the body by the lining of the inner mouth using the Company's proprietary RapidMist™ device. The Company's buccal insulin spray product, Generex Oral-lyn™ is in Phase III clinical trials at several sites around the world. Antigen Express, Inc. is a wholly owned subsidiary of Generex. The core platform technologies of Antigen Express comprise immunotherapeutic vaccines for the treatment of malignant, infectious, allergic, and autoimmune diseases. Antigen Express has pioneered the use of specific CD4+ T helper stimulation in immunotherapy. One of its platform technologies relies on inhibition of expression of the Ii protein. Antigen Express scientists, and others, have shown clearly that suppression of expression of the Ii protein in cancer cells allows for potent stimulation of T helper cells and prevents the further growth of cancer cells. For more information, visit the Generex website at www.generex.com or the Antigen Express website at www.antigenexpress.com.
Cautionary Note Regarding Forward-Looking Statements
This release and oral statements made from time to time by Generex representatives in respect of the same subject matter may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by introductory words such as "expects," "plan," "believes," "will," "achieve," "anticipate," "would," "should," "subject to" or words of similar meaning, and by the fact that they do not relate strictly to historical or current facts. Forward-looking statements frequently are used in discussing potential product applications, potential collaborations, product development activities, clinical studies, regulatory submissions and approvals, and similar operating matters. Many factors may cause actual results to differ from forward-looking statements, including inaccurate assumptions and a broad variety of risks and uncertainties, some of which are known and others of which are not. Known risks and uncertainties include those identified from time to time in the reports filed by Generex with the Securities and Exchange Commission, which should be considered together with any forward-looking statement. Risks and uncertainties relating to the proposed dividend include the risks that: (1) Generex and Amarantus do not reach a definitive agreement; (2) Generex will not obtain the stockholder approval of the reverse stock split; (3) Generex will not meet the standards for listing its common stock on a national stock exchange; (4) Amarantus will be unable to have a registration statement declared effective; (5)the trading price of Amarantus shares declines after a definitive agreement is signed and (6) the market for Amarantus shares is adversely affected by the dividend. No forward-looking statement is a guarantee of future results or events, and one should avoid placing undue reliance on such statements. Generex undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Generex cannot be sure when or if it will be permitted by regulatory agencies to undertake additional clinical trials or to commence any particular phase of clinical trials. Because of this, statements regarding the expected timing of clinical trials or ultimate regulatory approval cannot be regarded as actual predictions of when Generex will obtain regulatory approval for any "phase" of clinical trials or when it will obtain ultimate regulatory approval by a particular regulatory agency. Generex claims the protection of the safe harbor for forward-looking statements that is contained in the Private Securities Litigation Reform Act.
|SOURCE Generex Biotechnology Corporation|
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