Bioxel Pharma Inc.

Bioxel Pharma Inc.

November 21, 2007 09:16 ET

Bioxel Closes a Private Placement of $3.6M


Bioxel Pharma Inc. ("Bioxel" or the "Corporation") (TSX VENTURE:BIP) a leading manufacturer of taxane active pharmaceutical ingredients (APIs) and developer of targeted oncology drugs, announces that it has closed today its private placement of Convertible Unsecured Debentures due in 2014. An aggregate of $3,659,000 in principal amount of 15% Convertible Unsecured Debentures was issued. Interest on the Debentures is payable semi-annually on May 21 and November 21 of each year, commencing on May 21, 2008. Subject to the consent of the TSX Venture Exchange pursuant to applicable policies regarding the issuance of shares in payment of interest, the Corporation will have the option to pay such interest by delivering Common Shares on the basis of prevailing market prices. The Debentures will be convertible at the option of the holder at any time prior to the maturity date into Common Shares of the Corporation at a conversion price of $0.16 per Common Share in the first two years from the date of issuance and for each subsequent year, of 10% higher than the conversion price in the preceding year.

The Debentures will not be redeemable prior to November 21, 2009. On and after November 21, 2009, the Debentures will be redeemable by the Corporation, subject to the fulfillment of certain conditions. Provided the weighted average trading price for the Common Shares is 200% over the conversion price, the Corporation will be entitled to settle the redemption price in Common Shares on the basis of a price corresponding to 95% of the market price. On maturity, holders of Debenture may, at their option, elect to receive payment of the principal amount of the Debentures together with the accrued interest in the form of Common Shares. This offering was made by way of a private placement.

As part of the offering, holders received an aggregate of 22,868,750 warrants to purchase an equal number of Common Shares at an exercise price of $0.16 per share for a period of 2 years from the date of closing.

In addition, a new control person could be created upon conversion of the Debentures in Common Shares of the Corporation. As a result and according the rules of the TSX Venture Exchange, Bioxel has obtained approval from a majority of its disinterested shareholders in order to pursue with the offering.

Paradigm Capital Inc. acted as lead agent in relation with the offering and Laurentian Bank Securities Inc. was part of the syndicate. The agents are entitled to a compensation of 8.00% of the amount raised pursuant to the offering and 4.00% of the amount raised from purchasers identified by Bioxel.

The net proceeds of the offering will be primarily used to fund commercialization, product development of new taxane ingredients including docetaxel and working capital.

Bioxel also announces today that it has entered into an agreement with a holder of its 15% convertible debentures totaling $500,000 issued in July 2002 pursuant to which such holder has agreed, subject to certain conditions, including obtaining all required regulatory approvals, to (i) cancel and forfeit the payment of the interest on the 2002 debentures accrued and unpaid since January 14, 2007; (ii) convert $150,000 or principal amount of 2002 debentures in 937,500 common shares and 937,500 warrants to purchase an equivalent number of common shares at a price of $0.16 per share for two years following closing of the offering; and (iii) convert $350,000 of 2002 debentures into $350,000 of Debentures and 2,187,500 warrants under the offering described above. This brings the total amount of Debentures issued today at $4,009,000.

The securities being offered have not, nor will they be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons absent U.S. registration or an applicable exemption from the U.S. registration requirements. This release does not constitute an offer for sale of securities in the United States.


Some of the statements made herein may constitute forward-looking statements. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause Bioxel's actual results, performance or achievements to be materially different from those expected or implied by any of Bioxel's statements. Actual events or results may differ materially. Bioxel disclaims any intention, and assumes no obligation, to update these forward looking statements.


Bioxel is an emerging leader in biopharmaceuticals, focused on developing, manufacturing and marketing taxane pharmaceutical ingredients. Taxanes are used in drug products for the treatment of cancer and other diseases, including psoriasis, rheumatoid arthritis, Alzheimer's disease and cardiovascular disease. Bioxel sells cGMP paclitaxel and develops a portfolio of other generic taxane APIs and taxane-based proprietary products for improved cancer therapy.

The TSX Venture Exchange has not reviewed the contents of this press release and accepts no responsibility for the adequacy or the accuracy thereof.

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