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Subsequent Events
3 Months Ended
Oct. 31, 2018
Subsequent Events [Abstract]  
Subsequent Events

Note 13 - Subsequent Events:

 

The Company has evaluated subsequent events occurring after the balance sheet date through the date the unaudited condensed interim consolidated financial statements were issued.

 

On November 5, 2018, Generex issued a press release, a copy of which is furnished herewith as Exhibit 99.1, announcing the record and payment dates for the common stock dividend on its shares of common stock, par value $.001 per share, at a ratio of 20 for 1.

 

Prior to payment of Generex’s 20 for 1 common stock dividend, on November 30, 2018, Joseph Moscato, the Company’s President and Chief Executive Officer, and Lawrence Salvo, a member of the Company’s Board of Directors, converted all shares of the Company’ Series I Convertible Preferred Stock owned by them.  Mr. Moscato received 3,276,000 shares of the Company’s Common Stock upon conversion.  Mr. Salvo received 3,354,645 shares of the Company’s Common Stock upon conversion.

 

On November 20, 2018, the Company’s wholly owned subsidiary, Antigen Express, Inc. (“Antigen”) entered into a Clinical Trial Agreement with NSABP Foundation, Inc. (“NSABP”). Pursuant to the Clinical Trial Agreement, NSABP will conduct a Phase II Study to evaluate efficacy of administering Merck Sharpe & Dhome’s (‘Merck”) Keytruda® (pembrolizumab) in combination with Antigen’s AE37 cancer vaccine for the treatment of metastatic triple negative breast cancer. While Merck is not a party to the Clinical Trail Agreement, Merck is expected to provide Keytruda® for the study pursuant to the Clinical Trial Collaboration and Supply Agreement between Antigen and Merck. An initial payment from Generex in the amount of $340,000 is due by December 20, 2018. If the study runs the full anticipated term, Generex will be responsible for an aggregate $2,118,461.

 

On November 25, 2018, Generex entered into a Securities Purchase Agreement with an investor pursuant to which the Company agreed to sell and sold its Note Due November 26, 2019 (“Note”) in the principal amount of $1,060,000. The purchase price of the Note was $1,000,000. The remaining $60,000 of principal amount represents original issue discount. The Note does not bear any stated interest in addition to the original issue discount.

 

On November 27, 2018, Generex Biotechnology Corporation (the “Company”) and Olaregen Therapeutix Inc. (“Olaregen”) entered into a binding letter of intent (“LOI”) contemplating the Company’s acquisition of 51% of the outstanding capital stock of Olaregen for a total consideration of twelve million dollars ($12,000,000) in accordance with the terms and conditions of the LOI (the "Proposed Acquisition").

 

On November 28, 2018, Generex Biotechnology Corporation (the “Company”) and Regentys Corporation. (“Regentys”) entered into a binding letter of intent (“LOI”) contemplating the Company’s acquisition of 51% of the outstanding capital stock of Regentys for a total consideration of fifteen million dollars ($15,000,000) in accordance with the terms and conditions of the LOI (the "Proposed Acquisition").

 

On December 1, 2018, after payment of the dividend, B-H Sanford, LLC, converted all shares of the Company’ Series H Convertible Preferred Stock owned by it into 25,200,000 shares of common stock.

 

On December 1, 2018, the Company issued to Stephen L. Berkman a Warrant exercisable for 15,000,000 shares of common stock. The Warrant is exercisable until December 1, 2019 at an exercise price of $2.50 per share. The Warrant contains a provision prohibiting the exercise of the Warrant to the extent that, after exercise, Mr. Berkman would own more than 9.99% of the Company’s common stock. The Warrant was issued pursuant to the January 18, 2017 Acquisition Agreement among the Company, Hema Diagnostic Systems, LLC (“HDS”), Stephen L. Berkman and the other equity owners of HDS. Despite the warrants being issued after the effective date of the 20 for 1 stock dividend, per an agreement with warrant holder, such warrants were not subject to the stock dividend and no adjustment was made to the exercise price.

 

On December 1, 2018, the Company and Mr. Berkman entered into an Agreement, Assignment and Release, pursuant to which Mr. Berkman transferred the remaining HDS equity interests to the Company, waiving and releasing any conditions to such transfer. HDS is now a wholly owned subsidiary of the Company. The Company and Mr. Berkman released $624,404 owed to him by the Company and $13,431,706 owed to him by HDS, as of October 31, 2018, in exchange for shares of the Company’s common stock valued at the aggregate of such amount using the closing price for the common stock on November 30, 2018. The pre-stock dividend closing price was $18.99, resulting in 32,881 shares issuable to Mr. Berkman.

On December 2, 2018, an arbitrator awarded Three Brothers Trading LLC, d/b/a Alternative Execution Group (“AEXG”) an aggregate of $315,695 in damages, costs and fees as well as warrants exercisable for 84,000 shares of Generex Common Stock at an exercise price of $2.50 per share. The awards were made pursuant to claims under a Memorandum of Understanding (“MOU”) between Generex and AEXG related to AEXG referring potential financing candidate to Generex.  AEXG has filed a petition to enforce the arbitrator’s award in the United States District Court for the Southern District of New York. The petition includes a demand of $3,300,360 as the value of the Warrants, The Arbitrator did not award the cash value of the warrants. The Company denies that AEXG is entitled to the cash value of the warrants and that the amount claimed is the cash value of the warrants.