Tevogen Bio Announces $8 Million Equity Investment
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Insights
The $8.0 million investment in Tevogen Bio Holdings Inc.'s Series A Preferred Stock represents a significant infusion of capital into the company. This transaction indicates investor confidence in Tevogen's strategic direction and its potential for growth within the biotech industry. The conversion feature into 2,000,000 shares of common stock adds an element of potential future equity dilution for current shareholders but also reflects a financing strategy that could minimize immediate dilution and provide capital with less impact on cash flows due to the cumulative dividend structure.
The 5% cumulative dividend, increasing annually by 2%, is a noteworthy aspect of the preferred stock, as it offers a fixed income component to investors, which is particularly attractive in the volatile biotech sector. However, this could also represent a growing financial obligation for Tevogen, potentially impacting its cash reserves if the company does not generate sufficient revenue to cover these dividends. The call right provision is a strategic move by the company, allowing it to potentially reduce the preferred stock's outstanding shares at a future date, should the common stock's price appreciate significantly.
Tevogen's focus on off-the-shelf T cell therapies in virology, oncology and neurology is indicative of the company's alignment with current market trends towards personalized medicine. The ability to offer affordable personalized therapies could position Tevogen favorably in a competitive market, as cost is a significant barrier to patient access in these advanced treatment modalities. The investor's commitment may also signal a broader market validation of Tevogen's approach to immunotherapy.
However, the biotech industry is characterized by high R&D costs, regulatory hurdles and a long path to commercialization. Tevogen's journey towards becoming a public company and attracting additional investment is crucial, but the company must navigate these challenges successfully to realize the commercial potential of its therapies. The impact of this investment on Tevogen's stock will depend on the company's ability to meet clinical and regulatory milestones and demonstrate a clear path to market for its therapies.
The legal structure of the Series A Preferred Stock offering, including the conversion rights and call right, is a common mechanism in biotech financing to balance investor protection with company flexibility. The volume weighted average price (VWAP) condition attached to the call right is a standard metric used to determine the fair market value of a stock over a period, providing a safeguard for investors against premature or unfavorable redemption by the company.
Furthermore, the non-voting nature of the Series A Preferred Stock ensures that the investor does not gain immediate control over corporate decisions, which can be an important consideration for the existing management and shareholders. The lack of mandatory redemption and the cumulative dividend structure are designed to provide investors with a degree of financial predictability while allowing the company to manage its liquidity without the pressure of immediate redemption obligations.
“We are excited to begin our journey as a public company with this additional investment,” said Dr. Ryan Saadi, the Company’s Chief Executive Officer and Chairperson. “We believe Tevogen’s patient-centric approach, which merges a focus on affordability with advanced science, is a blueprint for sustainable success in the current era of healthcare. I am pleased that investors now have the opportunity to participate in Tevogen’s mission to become the very first life science company offering commercially attractive and affordable personalized T cell therapies for large patient populations in virology, oncology, and neurology.”
The shares of Series A Preferred Stock will be issued in the first quarter and will be convertible into a total of 2,000,000 shares of the Company’s common stock at the election of the holder. The Series A Preferred Stock is subject to a call right providing the Company the right to call the stock if the volume weighted average price of the common stock for the 20 days prior to delivery of the call notice is greater than
About Tevogen Bio
Tevogen Bio is a clinical-stage specialty immunotherapy company harnessing one of nature’s most powerful immunological weapons, CD8+ cytotoxic T lymphocytes, to develop off-the-shelf, genetically unmodified precision T cell therapies for the treatment of infectious diseases, cancers, and neurological disorders, aiming to address the significant unmet needs of large patient populations. Tevogen Leadership believes that sustainability and commercial success in the current era of healthcare rely on ensuring patient accessibility through advanced science and innovative business models. Tevogen has reported positive safety data from its proof-of-concept clinical trial, and its key intellectual property assets are wholly owned by the company, not subject to any third-party licensing agreements. These assets include three granted patents and twelve pending patents, two of which are related to artificial intelligence.
Tevogen Bio is driven by a team of highly experienced industry leaders and distinguished scientists with drug development and global product launch experience. Tevogen Bio’s leadership believes that accessible personalized therapeutics are the next frontier of medicine, and that disruptive business models are required to sustain medical innovation.
Forward-Looking Statements
This press release contains certain statements that are not historical facts and are forward-looking statements within the meaning of the federal securities laws, including without limitation statements regarding the anticipated benefits of the recent business combination with Semper Paratus Acquisition Corporation (the “Business Combination”), the future financial condition and performance of Tevogen Bio, and the product candidates, products, markets, and expected future performance and market opportunities of Tevogen Bio. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “think,” “strategy,” “future,” “opportunity,” “potential,” “plan,” “seeks,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties.
Many factors could cause actual future events to differ materially from the forward-looking statements in this communication, including but not limited to: (i) the effect of the announcement of the Business Combination on Tevogen Bio’s business relationships, operating results, and business generally; (ii) the outcome of any legal proceedings that may be instituted against Tevogen Bio related to the Merger Agreement or the Business Combination ; (iii) changes in the markets in which Tevogen Bio competes, including with respect to its competitive landscape, technology evolution, or regulatory changes; (iv) changes in domestic and global general economic conditions; (v) risk that Tevogen Bio may not be able to execute its growth strategies or may experience difficulties in managing its growth and expanding operations; (vi) risk that Tevogen Bio may not be able to develop and maintain effective internal controls; (vii) costs related to the Business Combination and the failure to realize anticipated benefits of the Business Combination or to realize estimated pro forma results and underlying assumptions, including with respect to estimated shareholder redemptions; (viii) the failure to recognize the anticipated benefits of the Business Combination and to achieve Tevogen Bio’s commercialization and development plans, and identify and realize additional opportunities, which may be affected by, among other things, competition, the ability of Tevogen Bio to grow and manage growth economically and hire and retain key employees; (ix) the risk that Tevogen Bio may fail to keep pace with rapid technological developments to provide new and innovative products and services or make substantial investments in unsuccessful new products and services; (x) the ability to develop, license or acquire new therapeutics; (xi) the risk that Tevogen Bio will need to raise additional capital to execute its business plan, which may not be available on acceptable terms or at all; (xii) the risk of product liability or regulatory lawsuits or proceedings relating to Tevogen Bio’s business; (xiii) uncertainties inherent in the execution, cost, and completion of preclinical studies and clinical trials; risks related to regulatory review, and approval and commercial development; (xiv) risks associated with intellectual property protection; (xv) Tevogen Bio’s limited operating history; and (xvi) those factors discussed in Tevogen Bio’s filings with the SEC and that that are contained in the Proxy Statement/Prospectus relating to the Business Combination.
The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in the “Risk Factors” section of the Proxy Statement/Prospectus and other documents to be filed by Tevogen Bio from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and while Tevogen Bio may elect to update these forward-looking statements at some point in the future, they assume no obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
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Tevogen Communications
T: 1 877 TEVOGEN, Ext 701
communications@Tevogen.com
Source: Tevogen Bio
FAQ
What type of stock did Tevogen Bio Holdings Inc. (TVGN) secure an investment for?
How much was the aggregate purchase price of the Series A Preferred Stock?
What is the conversion rate for the Series A Preferred Stock into common stock?
What is the call right provision for the Series A Preferred Stock?
Does the Series A Preferred Stock have voting rights?
