SOUTH SAN FRANCISCO, Calif., March 15 /PRNewswire-FirstCall/ -- Cell
Genesys, Inc. (Nasdaq: CEGE) announced today that it has entered into a
Committed Equity Financing Facility (CEFF) with Kingsbridge Capital Limited,
an institutional investor, in which Kingsbridge has committed to provide up to
$75 million of capital during the next three years through the purchase of
newly-issued shares of Cell Genesys common stock. The CEFF allows Cell
Genesys to raise capital at the time, price and in amounts deemed suitable to
the Company to support Cell Genesys' corporate, research and development
activities. Under the terms of the CEFF, Kingsbridge may not sell short the
Company's stock during the term of the agreement.
Certain details of the CEFF are as follows:
-- For a period of three years, Cell Genesys can access up to $75 million
dollars from Kingsbridge in exchange for newly-issued shares of Cell
Genesys common stock. Cell Genesys may access the capital after the
Securities and Exchange Commission (SEC) declares effective the
registration statement to be filed by Cell Genesys covering the resale
of the shares of common stock issuable in connection with the CEFF and
the shares of common stock underlying the warrant discussed below.
-- Cell Genesys my access capital under the CEFF in tranches of up to the
lesser of $15 million or 2.5% of Cell Genesys' market capitalization at
the time of the draw down of such tranche, subject to certain
conditions. Each tranche will be issued and priced over an eight-day
pricing period. Kingsbridge will purchase shares of common stock
pursuant to the CEFF at discounts ranging from 6% to 10%, depending on
the average market price of the common stock during the eight-day
pricing period, provided that the minimum acceptable purchase price for
any shares to be issued to Kingsbridge during the eight-day period is
determined by the higher of $3.00 or 85% of Cell Genesys' share price
the day before the commencement of each draw down.
-- Throughout the term of the agreement, Kingsbridge is restricted from
engaging in any shorting transaction of Cell Genesys' common stock.
-- Cell Genesys is not obligated to utilize any of the $75 million
available under the CEFF and there are no minimum commitments or
minimum use penalties. The CEFF agreement does not contain any
restrictions on Cell Genesys' operating activities, automatic pricing
resets or minimum market volume restrictions.
-- The agreement does not prohibit Cell Genesys from conducting additional
debt or equity financing, other than financings similar to the CEFF.
-- In connection with the CEFF, Cell Genesys issued a warrant to
Kingsbridge to purchase up to 375,000 shares of common stock at an
exercise price of $9.1208 per share which represents a 30% premium over
the average of the closing bid prices of Cell Genesys' common stock
during the 5 days preceding the signing of the agreement. The warrant
will become exercisable after the six month anniversary of the date of
the agreement. The warrant will remain exercisable, subject to certain
exceptions, until five years after the date of the agreement.
The securities issuable in connection with the CEFF and upon the exercise
of the warrant issued to Kingsbridge have not been registered under the
Securities Act of 1933 and may not be offered or sold in the United States
absent registration under the Securities Act of 1933 and applicable state
securities laws or available exemptions from registration requirements. Cell
Genesys has agreed to file a registration statement for the resale of the
shares of common stock issuable in connection with the CEFF and the shares of
common stock underlying the warrant within 60 days of the date of the
agreement. This press release shall not constitute an offer to sell or the
solicitation of an offer to buy these securities, nor shall there be any sale
of these securities in any state which such offer, solicitation or sale would
be unlawful prior to the registration or qualification under the securities
laws of any such state.
Cell Genesys is focused on the development and commercialization of novel
biological therapies for patients with cancer. The company is currently
pursuing two clinical stage product platforms -- GVAX(R) cancer
immunotherapies and oncolytic virus therapies. Ongoing clinical trials
include Phase 3 trials of GVAX immunotherapy for prostate cancer, Phase 2
trials of GVAX immunotherapy for pancreatic cancer and leukemia, and a Phase 1
trial of CG0070 oncolytic virus therapy for bladder cancer. Cell Genesys
continues to hold an equity interest in its former subsidiary, Ceregene, Inc.,
which is developing gene therapies for neurodegenerative disorders. Cell
Genesys is headquartered in South San Francisco, CA and has its principal
manufacturing operation in Hayward, CA. For additional information, please
visit the company's website at http://www.cellgenesys.com.
Statements made herein about the company, other than statements of
historical fact, including statements about the company's progress, results
and timing of clinical trials and preclinical programs and the nature of
product pipelines are forward-looking statements and are subject to a number
of uncertainties that could cause actual results to differ materially from the
statements made, including risks associated with the success of clinical
trials and research and development programs, the regulatory approval process
for clinical trials, competitive technologies and products, patents,
continuation of corporate partnerships and the need for additional financings.
For information about these and other risks which may affect Cell Genesys,
please see the company's Annual Report on Form 10-K for the year ended
December 31, 2005 filed on March 13, 2006 as well as Cell Genesys' reports on
Form 10-Q and 8-K and other reports filed from time to time with the
Securities and Exchange Commission. The company assumes no obligation to
update the forward-looking information in this press release.
Contact: Ina Cu
Investor Relations
Cell Genesys, Inc.
650-266-3200
SOURCE Cell Genesys, Inc.
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Related links:
http://www.cellgenesys.com
CONTACT:
Ina Cu, Investor Relations of Cell Genesys,
Inc., +1-650-266-3200
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