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CYTOMEDIX ANNOUNCES
ITS OUTSIDE PATENT COUNSEL AGREES TO TAKE EQUITY STAKE IN
THE COMPANY
Patent Counsel Will Waive
Future Payments of Contingent Legal Fees for Past Services
ROCKVILLE, Md., Aug. 23, 2007 – Cytomedix, Inc. (AMEX: GTF)
today announced that it has executed a term sheet agreement with
Fitch, Even Tabin, & Flannery, LLC (Fitch Even) and The Coleman Law
Firm (Coleman Law), the Company’s patent counsel. The agreement sets
forth the binding terms to be incorporated in definitive agreements,
but generally provides for the issuance of equity in exchange for
the waiver of future contingent legal fees relating to existing
license agreements and a revised retainer agreement for future work.
Cytomedix will issue 1.3 million shares of its Common Stock to Fitch
Even and Coleman Law and 975,000 warrants. Equal thirds of the
warrants are exercisable at $1.25, $1.50, and $1.75 respectively,
and are callable if the closing stock price remains at or above
$4.00, $5.00, and $6.00 respectively, for 10 consecutive trading
days. The warrants do not contain a cashless exercise feature, and
therefore, if exercised in full, would provide a capital infusion to
the Company of approximately $1.5 million. The parties agreed that
Cytomedix will file a resale registration statement within 60 days
of the execution of the term sheet agreement. The shares of stock
and the shares underlying the warrants carry certain restrictions
regarding public resale but would become unrestricted gradually over
a period not to exceed 3 quarters from the date that the
registration statement is declared effective.
In exchange for the above compensation, Fitch Even and Coleman Law
will waive any claim for contingent legal fees associated with
existing license agreements that arose from the current retainer
agreement by and between the Company and these two law firms.
Furthermore, the parties have agreed to the basic terms of a new
retainer agreement.
“We are very pleased to have reached this agreement with our
attorneys who have been trusted allies and valued advisors in our
business pursuits thus far. We believe this is a strong endorsement
of the future potential of the Company by a group that knows us
well”, said Dr. Kshitij Mohan, Chairman and CEO of Cytomedix. “This
should significantly improve our cash flow over the next couple
years as well as restructure our retainer agreement to better suit
our current business strategy and direction”, he added.
“Coleman Law is proud to have represented Cytomedix through its
litigation and licensing battles, and stands ready with its
co-counsel to assist the Company going forward as it continues to
enforce the company’s significant intellectual property rights,”
said Steve Jakubowski, counsel at Coleman Law. “Coleman Law has
agreed to convert its significant rights to contingency fees into
equity in order to align our interests with shareholders and show
our support for the Company’s efforts to introduce this important
technology into the wound care arena,” he added.
ABOUT CYTOMEDIX
Cytomedix, Inc. is a biotechnology company specializing in processes
and products derived from autologous platelet releasates for uses
with wounds and other applications. The current offering is
AutoloGel™System, a process that utilizes an autologous platelet gel
composed of multiple growth factors, other platelet releasates, and
fibrin matrix. The Company has announced favorable results from its
blinded, prospective, multi-center clinical trial on the use of its
technology with diabetic foot ulcers. Additional information
regarding Cytomedix is available at: http://www.cytomedix.com
SAFE HARBOR STATEMENT
Statements contained in this press release not relating to
historical facts are forward-looking statements that are intended to
fall within the safe harbor rule for such statements under the
Private Securities Litigation Reform Act of 1995. The information
contained in the forward-looking statements is inherently uncertain,
and Cytomedix's actual results may differ materially due to a number
of factors, many of which are beyond Cytomedix's ability to predict
or control, including among others, the success of new sales
initiatives, governmental regulation, acceptance by the medical
community and competition.
As of this date, the FDA has not granted marketing clearance for the
AutoloGel™ Systems, and there is no guarantee that the FDA will
reverse its decision on the Company’s 510(k) submission for a
specific wound healing indication. Further, there is no guarantee
that a response from the FDA will be received within any estimated
timeframe. Further, even assuming the FDA grants the Company’s
request for marketing clearance, there is no guarantee that the
Company will receive Medicare or other third-party reimbursement for
its product, the Company’s marketing efforts will be successful, or
that it will be able to achieve its other strategic goals. There is
also no guarantee that the Company’s current capitalization will be
sufficient to attain its goals, that future funding will be
available to the Company on acceptable terms, or that the Company
will ever be able to sustain itself from ongoing operations.
The forward-looking statements in this press release are subject to
known and unknown risks and uncertainties that could cause actual
events to differ from the forward-looking statements. More
information about some of these risks and uncertainties may be found
in the reports filed with the Securities and Exchange Commission by
Cytomedix, Inc., including the Company’s Form 10-K for the year
ended December 31, 2006. Except as is expressly required by the
federal securities laws, Cytomedix undertakes no obligation to
update or revise any forward-looking statements, whether as a result
of new information, changed circumstances, or future events or for
any other reason.
SOURCE: Cytomedix, Inc.
The Wall Street Group, Inc.
Ron Stabiner
(212) 888-4848 |
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