Press releases
ADVITECH EXECUTES A BINDING TERM SHEET FOR A $1M PRIVATE OFFERING
10 February 2009
TSX VENTURE EXCHANGE: AVI For immediate release
QUEBEC CITY, QUEBEC - February 10, 2009 - Advitech Inc. ("Advitech" or the "Corporation") (TSX Venture Exchange: AVI) announces the execution of a binding term sheet for a $1 million private offering and changes to its management team.
EQUITY FINANCING AND CASH POSITION
Advitech and AgeChem Venture Fund L.P. ("AgeChem"), which currently holds an equity interest of 11.05% in the Corporation, entered into a binding term sheet providing for an equity investment by AgeChem in Advitech of $1,000,000 through the issuance of a total of 50,000,000 units (a "Unit") at a price of $0.02 per unit. Each Unit is to be comprised of one common share of the Corporation (a "Common Share") and one common share purchase warrant (a "Warrant"). Each Warrant will entitle the holder thereof the right to purchase one additional Common Share at a price of $0.05 for the first year and $0.10 for the next four years.
The closing of this transaction is subject to (i) the approval of the TSX Venture Exchange and of the shareholders of Advitech, (ii) the conversion of Advitech's currently outstanding debentures into common shares according to conditions agreed with AgeChem, and (iii) the appointment at closing of two additional directors nominated by AgeChem to the Corporation's Board of Directors. As of today, the Corporation has received undertakings by its principal debentures holders of their agreement for the conversion of their debentures at a conversion price of $0.02 per share. Advitech expects to hold a special shareholders' meeting and to complete this transaction by mid-April 2009.
"This financing will fuel Advitech's organic growth and will allow the Corporation to invest in its marketing activities. The business plan approved by the Board of Directors in December 2008 also includes external growth through mergers and acquisitions" commented Mr. Renaud Beauchesne, President and Chief Executive Officer of Advitech. Mr. Beauchesne further added that "this transaction, during these difficult market conditions, validates the Corporation's business plan and objectives of Advitech."
"This financing will consolidate Advitech's very strong products' pipeline and will enable the Corporation to execute on their commercial development programs and increase their sales in the U.S., Europe and Asia" stated Mr. Louis Lacasse, Managing Partner of AgeChem.
As of January 31, 2009, Advitech had a cash position of approximately $96,000. To preserve its current working capital until the successful completion of the financing described above, Advitech has implemented a program to reduce its expenses.
RECENT CHANGES IN MANAGEMENT TEAM
Effective as of January 1, 2009, Mr. Christian Labbé, formerly Finance Director of the Corporation, was appointed Vice-President and Chief Financial Officer of the Corporation. "Mr. Labbé, who joined Advitech in September 2007, has demonstrated the leadership and professionalism needed to fulfill the responsibilities of a CFO. Considering the financial plan of the Corporation and our current growth strategy, his skills will be better used in this position" said Mr. Beauchesne, President and Chief Executive Officer at Advitech.
Mr. Luc Clouâtre, formerly Vice-President Business Development, Sales and Marketing, resigned from his position with Advitech in December 2008. The Corporation is currently evaluating the need to replace Mr. Clouâtre.
Mr. Richard Lacerte, formerly Director of Sales and Marketing, also resigned from his position to pursue a new career opportunity. He was replaced at the beginning of January 2009 by Mrs. Pascale LaCerte who held different sales and marketing positions in companies such as Cognicase, Yokohama and Fortsum.
ABOUT AGECHEM VENTURE FUND L.P.
The AgeChem Venture Fund L.P. is currently investing in companies developing therapeutics targeting age-related diseases. The range of diseases and chronic conditions associated with aging provides a breadth of attractive investment opportunities. AgeChem's principals have been active in the healthcare sector for over 15 years having made investments in several private and public entities. In addition to AgeChem, some of the principals are also managing the GeneChem Technologies Venture Fund L.P. and the GeneChem Therapeutics Venture Fund L.P. (http://www.genechem.com/).
ABOUT ADVITECH INC. http://www.advitech.com/:
Advitech is a health sciences and technology company with a mission to discover and commercialize proprietary and evidence-based natural health products. Effective and safe, these products play a role in the prevention of immune-mediated inflammatory disorders, such as psoriasis and inflammatory bowel disease. Advitech produces Dermylex® for the treatment of mild-to-moderate psoriasis.
Advitech has drawn up a research program to develop new applications related to wound healing. This development is derived from both its XP-828L and IM technological platforms.
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This press release contains forward-looking statements, which reflect the Corporation's current expectations regarding future events. The forward-looking statements involve risks and uncertainties. Actual results could differ materially from those projected herein. Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information, please contact:
Advitech Inc.
Renaud Beauchesne, MBA | Serge Comeau |
President and Chief Executive Officer | Investor's relations |
418-686-7498, ext. 228 | 514-862-4160 |