Announces Settlement of Lawsuits Related to September 2002 Financing
YONKERS, N.Y., May 16 /PRNewswire-FirstCall/ -- Advanced Viral Research
Corp. (OTC Bulletin Board: ADVR) today announced that it received net proceeds
of $862,500 from the sale to Cornell Capital Partners of $1 million of its 5%
convertible debentures, due April 28, 2008. Cornell Capital Partners
committed to purchase an additional $500,000 of convertible debentures at par
within 10 business days of the filing of a registration statement with the SEC
covering the resale of shares underlying the convertible debentures and an
additional $1,000,000 of convertible debentures at par within 20 business days
from the date the registration statement is declared effective by the SEC.
Cornell Capital Partners or its assignees will receive cash compensation
equal to 10% of the gross proceeds of the convertible debentures purchased,
and has received warrants to purchase an aggregate of 15,000,000 shares of the
Company's common stock, exercisable at a per share purchase price of $0.097
commencing on October 28, 2003 through April 28, 2008. The holder of the
convertible debentures may convert the debenture plus accrued interest, (which
may be taken at the holder's option in cash or common stock), in shares of the
Company's common stock at a conversion price equal to the lesser of (a) $.08
or (b) 80% of the lowest closing bid price of our common stock for the four
trading days immediately preceding the conversion date. No more than $600,000
may be converted in any thirty-day period.
In addition, ADVR completed a Securities Purchase Agreement with certain
investors pursuant to which the Company received gross proceeds of $826,000 in
exchange for the issuance and private sale of 10,325,000 shares of its common
stock, par value $.00001 per share, or $0.08 per share and warrants to
purchase an aggregate of 6,195,000 shares of the Company's common stock, which
are exercisable for five years from the date of issuance at an exercise price
of $0.12 per share. These warrants are not exercisable prior to July 28,
2003.
The proceeds from these financings will be used for general corporate
purposes, including the costs of ongoing clinical studies of Product R in
Israel that were initiated in November 2002. The investors in the private
placement were largely existing shareholders of the Company.
Litigation Settlement Announced
ADVR also announced that it has reached settlements with SDS Merchant
Fund, L.P.; Alpha Capital, A.G,; Knight Securities, L.P.; Stonestreet Limited
Partnership; and Bristol Investment Fund, Ltd., among others, that dismisses
ADVR's lawsuit filed in December 2002 in the U.S. Circuit Court for the 11th
Judicial Circuit, Miami-Dade County, Florida, which action was removed to the
U.S. District Court for the Southern District of Florida.
The settlements also resolve related suits that were filed by several of
the parties (Alpha, Bristol and Stonestreet) named in the Florida suit in the
District Court for the Southern District of New York against ADVR. The suits
related to a September 2002 financing agreement. As a result of the
settlements, ADVR has agreed to pay certain of the parties involved in the
litigation approximately $949,714.24, of which $385,714.24 is payable over six
(6) months, and, in turn, ADVR was released from its alleged contractual
obligation to permit the exercise of over 15,000,000 warrants at $0.00001 per
share. In addition, one of the remaining purchasers in the September 2002
Agreement, who was not a party to the litigation agreed to lock up 680,000,
shares of ADVR common stock for a period of 145 days and ADVR paid $30,320.00
to release the purchaser's rights to exercise additional warrants. In
addition, 267,000 shares of common stock were issued to one investor in the
September 2002 financing in accordance with the terms of this financing. Two
additional investors in the September 2002, financings were paid $67,857 and
these investors released ADVR from its contractual obligation to permit the
exercise of their warrants in accordance with the September 2002 financing.
In December 2002, ADVR filed a complaint against SDS Merchant Fund (SDS)
and others alleging, among other things, violations of the Florida Securities
Investor Protection Act in connection with a Securities Purchase Agreement
between ADVR and certain investors, including SDS.
After filing the complaint, ADVR became aware of facts that make the
complaint's allegations of violations of the Florida Securities law against
SDS unfounded. As a result of the foregoing, ADVR has dismissed the Florida
action against SDS, and such dismissal has been accepted by the Court. ADVR
apologizes to SDS and its representatives for any misunderstanding which may
have arisen by virtue of its inclusion in the lawsuit, and the allegations in
the lawsuit. ADVR would welcome future investments by SDS in ADVR. The
dismissal of the claims against SDS does not in any way affect the claims made
in Florida against the other defendants, or as to certain other purchases who
have brought lawsuits against ADVR in New York.
ADVR's Product R represents a biopolymer chemistry that possesses novel
immunomodulator activity. This peptide-nucleic acid, which to date has shown
no indication of human toxicity, appears to stimulate the proinflammatory
responses required to combat viral infections such as AIDS and human papilloma
virus and to dampen aberrant autoimmune-type inflammatory responses, such as
occur in patients with rheumatoid arthritis. Therefore, Product R has been
termed a "switch-type" immunomodulator. Product R is in clinical trials in
Israel for the treatment of cachexia (body wasting) in patients with AIDS and
patients with cancer.
Advanced Viral Research Corp., based in Yonkers, New York, is a
biopharmaceutical firm dedicated to improving patients' lives by researching,
developing and bringing to market new and effective therapies for viral and
other diseases.
Note: This news release contains forward-looking statements that involve
risks associated with clinical development, regulatory approvals, including
application to the FDA, product commercialization and other risks described
from time to time in the SEC reports filed by the Company. Product R is not
approved by the U.S. Food and Drug Administration or any comparable agencies
of any other countries. There is no assurance that the Company will be able to
secure the financing necessary to continue and/or complete the clinical trials
of Product R or satisfy certain other conditions relating to clinical trials
including obtaining adequate insurance on terms acceptable to the Company. The
Company undertakes no obligation to update or revise the information contained
in this announcement whether as a result of new information, future events or
circumstances or otherwise.
Contact: Mayr Communications Inc.
Charles Mayr
Tel: 877.777.6010
mayrcomm@att.net
SOURCE Advanced Viral Research Corp.
 back to top
Related links:
http://www.adviral.com
CONTACT:
Charles Mayr of Mayr Communications Inc.,
1-877-777-6010, mayrcomm@att.net, for Advanced Viral Research
Corp.
|
