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MagForce Nanotechnologies Signs Standby Equity Distribution Agreement

Published on May 4, 2010 at 4:06 AM

MagForce Nanotechnologies AG has signed a Standby Equity Distribution Agreement ("SEDA") with YA Global Master SPV Ltd. ("YA Global"), an investment fund managed by Yorkville Advisors. Under this agreement, MagForce now has the option over the next 36 months to avail itself of a binding commitment by YA Global to subscribe to and purchase multiple tranches of newly issued shares from the company’s approved capital up to a total amount of EUR 20 million. MagForce will retain complete discretion over if and when it makes use of its rights over the life of the option.

Under the terms of the agreement, MagForce may offer these tranches from time-to-time, pursuant to the terms of the agreement. The purchase price of newly issued shares shall be determined by a formula based on the market price of MagForce’s stock. The commitment provides MagForce with flexible access to additional equity capital of up to EUR 20 million, thus ensuring that the company retains a sound basis of financial comfort as it enters the rapidly approaching commercialization phase and further expands its R&D pipeline.

"The signing of this agreement with YA Global will better enable MagForce to proceed with two very important investments," explained Dr. Peter Heinrich, CEO of MagForce Nanotechnologies AG. "Firstly, it will provide us with additional resources for the European market launch of Nano-Cancer® therapy for the first indication expected to receive European regulatory approval, which is glioblastoma multiforme. Secondly, it will allow us to expand our clinical investigations to encompass even more kinds of solid tumors. With this additional capital now available, we will be able to accelerate our transformation from an essentially German R&D venture financed with German capital into a truly international commercial enterprise."

"We are extremely pleased to be able to announce our investment in MagForce" said Dr. Michael J. Nowak, head of healthcare and managing director at Yorkville Advisors. MagForce is currently moving forward with the planned market launch of its first product in what is perhaps the most interesting phase of company development. Dr. Nowak added, "The innovative structure of our investment commitment, with its combination of both flexibility and financial security, is an ideal arrangement for the company at this stage."

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