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Monday, June 06, 2011 9:26:11 AM
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As the first component of the overall financing arrangements, the initial $3 million investment has been provided by a multi-billion dollar institutional investment fund based in Minnesota. The investment is structured as a convertible note with warrants. The note is not convertible until maturity, 18 months after closing, and is only convertible into unregistered restricted stock at that time. The conversion price of the note is a fixed, specified price per share, at a three percent (3%) discount from the market price at the time of the note agreement (the volume weighted average price over the 10 trading days ending on the May 31st closing date), and the warrant coverage is one hundred percent without any cashless exercise provision.
As such, this $3 million investment reflects a long-term interest in the Company on the part of the investor, and will provide for the continued acceleration of the Company's GBM brain cancer clinical trial while the arrangements for the $25 million follow-on facility are being implemented.
"We are pleased to receive strong support and long-term interest from a major institutional investor," commented Dr. Alton Boynton. "It reflects a growing recognition in the investor community of NWBT's progress operationally, and NWBT's significant growth potential."
As the second component of the overall financing arrangements, Toucan Partners has agreed to provide an equity facility to enable NWBT to issue registered, tradable shares for future financings of up to $25 million over a 30-month period. The shares involved in this equity facility will be registered in several tranches, and the 30-month period will begin on the effective date of the first registration statement.
Any use of this equity facility will be entirely in the Company's discretion. If the Company elects to make maximum use of the facility, it can potentially cover all of the remaining costs for the ongoing 240-patient GBM brain cancer clinical trial to complete the patient enrollment and reach the primary endpoint of the trial, as well as other near term initiatives.
Upon notification by the Company, Toucan will be obligated to purchase a specified amount of stock based upon a backward-looking, fixed price formula of ninety-five percent (95%) of the average of the three (3) lowest closing bid prices of the Company's common stock during the fifteen (15) trading days prior to the Company's notification date. Toucan will receive a one percent (1%) commitment fee for the facility upon execution, and a five percent (5%) fee on the sales of shares under the facility when the sales are executed.
"This equity facility marks an important step in taking control of our own financing destiny, as it will enable us to access a much wider pool of investors who have been expressing interest but can only invest in tradable shares, while also providing the comfort of knowing that the equity facility will be administered by a major shareholder whose interests are aligned with the Company's," commented Dr. Alton Boynton. "The facility also affords us substantially more favorable terms than have been available to us in financings with unregistered shares or convertible debt."
About Northwest Biotherapeutics
Northwest Biotherapeutics is a biotechnology company focused on developing immunotherapy products that treat cancers more effectively than current treatments, without toxicities of the kind associated with chemotherapies, and on a cost-effective basis. The Company has a broad platform technology for dendritic cell-based vaccines. The Company's lead clinical trial is a 240-patient Phase II trial in newly diagnosed Glioblastoma multiforme ("GBM"), the most aggressive and lethal of brain cancer. The Company also previously received clearance from the FDA for a 612-patient Phase III trial in prostate cancer, and clearance from the FDA for Phase I trials in five other cancers. The Company has also conducted a Phase I/II trial with DCVax® for recurrent metastatic ovarian cancer.
For further information about clinical sites and about the Company, please visit the Company's web site at www.nwbio.com.
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