Encorium Group, Inc. Completes $1.6 Million Private Placement of Common Stock and Executes Warrant Exchange Agreement; Ends Disc
October 19 2009 - 8:30AM
PR Newswire (US)
Encorium to Report Third Quarter 2009 Financial Results on November
16 and Hold Conference Call on November 17, 2009 BERWYN, Pa., Oct.
19 /PRNewswire-FirstCall/ -- Encorium Group, Inc. (NASDAQ:ENCO), a
full-service multinational contract research organization (CRO)
that provides design, development, and management capabilities for
clinical trials and patient registries to many of the world's
leading pharmaceutical companies, today announced that it has
completed a private placement of 3,937,500 shares of its common
stock with a private investor for an aggregate purchase price of
$1,575,000, or $.40 per share. Prior to the transaction, the
Company has entered into Warrant Exchange Agreements with two
investors (the "Investors") pursuant to which the Company issued to
the Investors an aggregate of 1,864,000 shares of Common Stock
(collectively, the "Exchange Shares") and warrants to purchase an
aggregate of 874,126 shares of Common Stock, exercisable for a
period of five years, at an exercise price of $.40 per share
(collectively, the "Exchange Warrants"). The Exchange Shares and
Exchange Warrants were issued in exchange for warrants dated as of
May 9, 2007 held by the Investors to purchase an aggregate of
874,126 shares of Common Stock of the Company (collectively, the
"Original Warrants"). The Company also announced that it has
terminated previously announced negotiations for the sale of the
Company's wholly-owned subsidiary Encorium OY to a clinical
research organization based in the United States and will not
pursue a sale of the Company or Encorium OY at this time. Given the
Company's recent successes with respect to its strategy to grow
into the world's leading vaccine franchise, including the recently
announced $8.7 million of new business contract wins and the
selection by a major pharmaceutical company for participation in a
swine flu vaccine program, together with the investment announced
today, the Company believes it is well positioned to win future
contracts in the vaccine and oncology fields. As a result, the
Company believes stockholder value will be maximized by moving
ahead independently, while continuing to focus on clinical vaccine
development. Dr. Kai Lindevall, executive chairman stated, "We are
very pleased that we were able to close this financing to shore up
our balance sheet and provide the Company with additional working
capital. Our experience and capabilities in the vaccine field
coupled with the recent new awards in this area demonstrate the
long term potential we have to grow into a leading vaccine
franchise with expertise in pre-clinical support, regulatory
consultancy and strategic trial planning. We believe these
developments will position us to move ahead independently and are
in the best interest of all stockholders." Of the 35,000,000
authorized capital stock of the Company, 26,325,383 shares of
common stock will be issued and outstanding immediately following
the closing. The shares of common stock issued in connection with
the above transactions have not been registered under the
Securities Act of 1933, as amended, and may not be offered or sold
in the United States absent registration under the Securities Act
and applicable state securities laws or an applicable exemption
from those registration requirements. The Exchange Shares will be
immediately freely transferable pursuant to Rule 144 of the Act
since the Investors are not affiliates of the Company and since the
Investors will be deemed to have held the Exchange Shares for
greater than 6 months pursuant to (d)(3)(ii) of Rule 144. For
additional information on the transactions described below, please
see our Current Report on Form 8-K filed with the SEC on October
19, 2009, which is available on the SEC website at
http://www.sec.gov/ Quarterly Results and Conference Call Financial
results for the third quarter ended September 30, 2009 are
scheduled for Monday, November 16, 2009, after the market closes.
Encorium will hold a conference call at 11:00 a.m. EST Tuesday,
November 17, 2009, to discuss its financial results and corporate
developments. Additional details will be forthcoming. This press
release does not constitute an offer to sell or the solicitation of
an offer to buy nor will there be any sale of these securities in
any state or jurisdiction in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the
securities laws of such state or jurisdiction. About Encorium
Group, Inc. Encorium Group, Inc. is a global clinical research
organization specializing in the design and management of complex
clinical trials and Patient Registries for the pharmaceutical,
biotechnology and medical device industries. The Company's mission
is to provide its clients with high quality, full-service support
for their biopharmaceutical and medical device development
programs. Encorium offers therapeutic expertise, experienced team
management and advanced technologies. The Company has drug and
biologics development as well as clinical trial experience across a
wide variety of therapeutic areas such as infectious diseases,
cardiovascular, vaccines, oncology, diabetes
endocrinology/metabolism, gene therapy, immunology, neurology,
gastroenterology, dermatology, hepatology, women's health and
respiratory medicine. Encorium believes that its expertise in the
design of complex clinical trials, its therapeutic experience and
commitment to excellence, and its application of innovative
technologies, offer its clients a means to more quickly and cost
effectively move products through the clinical development process.
This press release contains forward-looking statements identified
by words such as "estimate," "project," "expect," "intend,"
"believe," "anticipate" and similar expressions. Those statements
involve risks and uncertainties, and actual results could differ
materially from those discussed. Factors that could cause or
contribute to such differences include, but are not limited to: (i)
the risk that we may not have sufficient funds to operate our
business; (ii) our success in attracting new business and retaining
existing clients and projects; (iii) the size, duration and timing
of clinical trials we are currently managing may change
unexpectedly; (iv) the termination, delay or cancellation of
clinical trials we are currently managing could cause revenues and
cash-on-hand to decline unexpectedly; (v) the timing difference
between our receipt of contract milestone or scheduled payments and
our incurring costs to manage these trials; (vi) outsourcing trends
in the pharmaceutical, biotechnology and medical device industries;
(vii) the ability to maintain profit margins in a competitive
marketplace; (viii) our ability to attract and retain qualified
personnel; (ix) the sensitivity of our business to general economic
conditions; (x) other economic, competitive, governmental and
technological factors affecting our operations, markets, products,
services and prices; (xi) announced awards received from existing
and potential customers are not definitive until fully negotiated
contracts are executed by the parties; (xii) our backlog may not be
indicative of future results and may not generate the revenues
expected; and (xiii) uncertainties regarding the availability of
additional capital and continued listing of our common stock on
Nasdaq. You should not place undue reliance on any forward-looking
statement. We undertake no obligation to publicly release the
result of any revision of these forward-looking statements to
reflect events or circumstances after the date they are made or to
reflect the occurrence of unanticipated events. Please refer to the
section entitled "Risk Factors" in the Company Annual Report on
Form 10-K for the year ended December 31, 2008 and the Company's
Quarterly Report on Form 10-Q for the period ended June 30, 2009
for a more complete discussion of factors which could cause our
actual results and financial position to change.
http://www.encorium.com/ DATASOURCE: Encorium Group, Inc. CONTACT:
Philip L. Calamia, Chief Financial Officer, Encorium Group, Inc.,
+1-610-989-4208 Web Site: http://www.encorium.com/
Copyright