Tevogen Bio Secures $6 Million Series C Preferred Stock Investment

Rhea-AI Summary

Tevogen Bio Holdings Inc. (Nasdaq: TVGN) has secured a $6 million Series C Preferred Stock investment from The Patel Family, LLP. The agreement includes:

• 7.5% annual dividend, accruing and payable quarterly
• Convertible to common stock after 6 months
• Callable by Tevogen after 5 years
• Non-voting and no mandatory redemption
• Dividends cease after 10 years if outstanding

The investment will be completed in two closings: $4 million on August 30, 2024, and $2 million on September 16, 2024. This long-term partnership reflects confidence in Tevogen's innovative approach to precision T cell therapies and its leadership team.

Positive

• Secured $6 million in Series C Preferred Stock investment
• Long-term partnership with The Patel Family, LLP
• 7.5% annual dividend for investors
• Flexibility for investors with conversion option after 6 months
• No mandatory redemption, reducing immediate financial pressure on the company

Negative

• Potential future dilution of common stock if preferred shares are converted
• 7.5% dividend rate may impact cash flow
• Company may face redemption pressure after 5 years

Insights

Financial Analyst

This $6 million Series C Preferred Stock investment is a significant boost for Tevogen Bio, a clinical-stage biotech company. The terms are notably favorable, with a 7.5% dividend rate and no mandatory redemption, providing stable funding. The two-tranche closing structure (August 30 and September 16) suggests a strategic approach to capital infusion. However, the convertibility after 6 months could potentially dilute existing shareholders if exercised. The non-voting nature of the stock limits investor influence but may be seen as a positive for management control. Overall, this deal strengthens Tevogen's financial position, potentially extending their runway for clinical trials and product development in their key therapeutic areas.

Biotech Industry Expert

Tevogen's focus on off-the-shelf, genetically unmodified T cell therapeutics is at the forefront of immunotherapy innovation. This investment validates their approach in a highly competitive field. The company's diversification across oncology, neurology and virology is ambitious but potentially lucrative if successful. The backing from The Patel Family, LLP, a seemingly knowledgeable investor in the space, adds credibility. However, as a clinical-stage company, Tevogen faces significant risks and costs associated with trials and regulatory approvals. This funding, while helpful, may only cover a fraction of their long-term capital needs given the expensive nature of biotech R&D.

Market Research Analyst

The investment reflects growing interest in precision T cell therapies, a rapidly evolving segment of the biotech market. Tevogen's Nasdaq listing (TVGN) provides liquidity for investors, which is attractive for a clinical-stage company. The long-term commitment from The Patel Family, LLP signals confidence that could positively influence market perception. However, the biotech sector is known for high volatility and Tevogen's success will ultimately depend on clinical trial outcomes and regulatory approvals. Investors should closely monitor Tevogen's pipeline progress and cash burn rate in relation to this new funding to assess the company's long-term prospects in the competitive immunotherapy landscape.

WARREN, N.J., Aug. 22, 2024 (GLOBE NEWSWIRE) -- Tevogen Bio Holdings Inc. (“Tevogen” or “Tevogen Bio”) (Nasdaq: TVGN), a clinical-stage specialty immunotherapy biotech pioneer developing off-the-shelf, genetically unmodified T cell therapeutics in oncology, neurology, and virology, has entered into a definitive agreement for a $6.0 million Series C Preferred Stock investment with The Patel Family, LLP.

The shares of Series C Preferred Stock will have a 7.5% dividend per year, accruing and payable quarterly. The Series C Preferred Stock is convertible into shares of common stock after 6 months at the election of the holder, and callable by Tevogen for redemption after 5 years at Tevogen’s election. The Series C Preferred Stock does not have any mandatory redemption and is non-voting. Dividends will cease to accrue after 10 years if the Series C Preferred Stock remains outstanding at that time.

A statement from The Patel Family, LLP reads, "Our commitment to a long-term position in Tevogen Bio stock reflects our conviction in its innovative approach to precision T cell therapies and to the leadership team. We believe they will ensure the company moves forward on its goals of helping patients and shareholders alike.”

“We are fortunate to have The Patel Family, LLP as a long-term partner that believes not only in our mission but also our vision for the future of medicine. We view their unwavering support and continued investment as a testament to the strength of our business model and the promise of our innovative therapies,” remarked founding CEO of Tevogen Bio, Dr. Ryan Saadi, MD, MPH.

The purchase agreement for the Series C Preferred Stock provides for two closings, one on August 30, 2024, for $4.0 million, and one on September 16, 2024, for $2.0 million.

About Tevogen Bio

Tevogen is a clinical-stage specialty immunotherapy company harnessing 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 numerous pending patents, two of which are related to artificial intelligence.

Tevogen is driven by a team of experienced industry leaders and scientists with drug development and global product launch experience. Tevogen’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 forward-looking statements, including without limitation statements relating to: expectations regarding the healthcare and biopharmaceutical industries; Tevogen’s development of, the potential benefits of, and patient access to its product candidates for the treatment of infectious diseases, cancer and neurological disorders, including TVGN 489 for the treatment of COVID-19 and Long COVID; Tevogen’s ability to develop additional product candidates, including through use of Tevogen’s ExacTcell platform; the anticipated benefits of ExacTcell; expectations regarding Tevogen’s future clinical trials; and Tevogen’s ability to generate revenue in the future. Forward-looking statements can sometimes be identified by words such as “may,” “could,” “would,” “expect,” “anticipate,” “possible,” “potential,” “goal,” “opportunity,” “project,” “believe,” “future,” and similar words and expressions or their opposites. These statements are based on management’s expectations, assumptions, estimates, projections and beliefs as of the date of this press release and are subject to a number of factors that involve known and unknown risks, delays, uncertainties and other factors not under the company’s control that may cause actual results, performance or achievements of the company to be materially different from the results, performance or other expectations expressed or implied by these forward-looking statements.

Factors that could cause actual results, performance, or achievements to differ from those expressed or implied by forward-looking statements include, but are not limited to: that Tevogen will need to raise additional capital to execute its business plan, which may not be available on acceptable terms or at all; the effect of the recent business combination with Semper Paratus Acquisition Corporation (the “Business Combination”) on Tevogen’s business relationships, operating results, and business generally; the outcome of any legal proceedings that may be instituted against Tevogen related to the Business Combination; changes in the markets in which Tevogen competes, including with respect to its competitive landscape, technology evolution, or regulatory changes; changes in domestic and global general economic conditions; the risk that Tevogen may not be able to execute its growth strategies or may experience difficulties in managing its growth and expanding operations; the risk that Tevogen may not be able to develop and maintain effective internal controls; costs related to the Business Combination and the failure to realize anticipated benefits of the Business Combination; the failure to achieve Tevogen’s commercialization and development plans, and identify and realize additional opportunities, which may be affected by, among other things, competition, the ability of Tevogen to grow and manage growth economically and hire and retain key employees; the risk that Tevogen 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; the ability to develop, license or acquire new therapeutics; that Tevogen will need to raise additional capital to execute its business plan, which may not be available on acceptable terms or at all; the risk of regulatory lawsuits or proceedings relating to Tevogen’s business; uncertainties inherent in the execution, cost, and completion of preclinical studies and clinical trials; risks related to regulatory review, and approval and commercial development; risks associated with intellectual property protection; Tevogen’s limited operating history; and those factors discussed or incorporated by reference in Tevogen’s Annual Report on Form 10-K and subsequent filings with the SEC.

You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. Tevogen undertakes no obligation to update any forward-looking statements, except as required by applicable law.

Contacts

Tevogen Bio Communications
T: 1 877 TEVOGEN, Ext 701
Communications@Tevogen.com

FAQ

What is the value of Tevogen Bio's recent Series C Preferred Stock investment?

Tevogen Bio (TVGNW) secured a $6 million Series C Preferred Stock investment from The Patel Family, LLP.

When will the Series C Preferred Stock investment in Tevogen Bio be completed?

The investment will be completed in two closings: $4 million on August 30, 2024, and $2 million on September 16, 2024.

What is the dividend rate for Tevogen Bio's Series C Preferred Stock?

The Series C Preferred Stock offers a 7.5% dividend per year, accruing and payable quarterly.

Can Tevogen Bio's Series C Preferred Stock be converted to common stock?

Yes, the Series C Preferred Stock is convertible into common stock after 6 months at the election of the holder.

Does Tevogen Bio's Series C Preferred Stock have voting rights?

No, the Series C Preferred Stock is non-voting.