MISSISSAUGA, ON, April 13 /PRNewswire-FirstCall/ -- Vasogen Inc.
(NASDAQ:VSGN; TSX:VAS) today reported the results of operations for
the three months ended February 28, 2009. All dollar amounts
referenced herein are in Canadian dollars unless otherwise noted.
At February 28, 2009, our cash and cash equivalents totaled $7.3
million, compared with $8.6 million at November 30, 2008. We
incurred a net loss for the three months ended February 28, 2009 of
$1.9 million, or $0.09 per common share, compared with a net loss
of $5.3 million, or $0.24 per common share for the same period in
2008. This decrease is the result of a significant reduction in the
number of employees and a decision not to incur material
expenditures to advance our products during the Company's ongoing
strategic review process. Restructuring costs of $1.1 million were
included in our net loss for the three months ended February 28,
2009. Corporate Update - To further reduce the rate at which we use
our cash during our strategic review process, in February 2009 we
further reduced our number of full-time employees to two. As part
of this restructuring, the employment of Chris Waddick, our
President and CEO, was terminated effective February 28, 2009. Mr.
Waddick has agreed to fulfill the role of CEO, in a consulting
capacity at substantially reduced compensation, to assist the Board
in bringing closure to the ongoing strategic review process. -
Pursuant to our restructuring plan, our Board of Directors and
Management has been actively involved in a process of screening,
reviewing, and short-listing potential opportunities including the
sale of the Company, or a merger or acquisition, and exploring the
monetization of certain tangible and intangible assets. The process
has also included a review of the potential out-licensing of
assets, lapsing of patents and patent applications, asset
divestiture, or liquidation of the Company. At this time, we have
significantly narrowed down the number of third party proposals
under consideration. If a definitive agreement that the Board
believes is in the best interest of our shareholders cannot be
reached in the near future, the Board will consider the other
alternatives that it has also been evaluating. These alternatives
include the potential to realize value from the monetization of
certain intangible assets either alone or potentially in
combination with a strategic transaction. The Board will continue
to assess the merits of these options relative to liquidating the
Company and distributing the remaining cash to the shareholders. -
As at February 28, 2009, we had cash and cash equivalents of $7.3
million and had 22.5 million common shares issued and outstanding.
Other than our accounts payable and accrued liabilities, we do not
have any debt. - We sold a United States patent application and its
related foreign counterparts for US$0.4 million. This device-based
intellectual property has not been used to date in the Celacade
System; however, we have retained rights to this technology for any
potential use as it relates to our Celacade System. - Subsequent to
quarter end, on March 25, 2009, the NASDAQ Stock Market further
suspended the enforcement of the Minimum Bid Price Rule requiring a
minimum US$1.00 closing price until July 20, 2009. Accordingly, the
NASDAQ indicated that it will not take action to delist any
security, including our common shares, for a violation of the
minimum bid price rule during the suspension. Certain statements in
this document constitute "forward-looking statements" within the
meaning of the United States Private Securities Litigation Reform
Act of 1995 and/or "forward-looking information" under the
Securities Act (Ontario). These statements may include, without
limitation, plans to consider a sale, merger, acquisition, or other
alternatives resulting from our strategic review, statements
regarding the status of development, or expenditures relating to
the Celacade(TM) System or our VP series of drugs including VP015
and VP025, plans to fund our current activities, statements
concerning our partnering activities, health regulatory
submissions, strategy, future operations, future financial
position, future revenues and projected costs. In some cases, you
can identify forward-looking statements by terminology such as
"may", "will", "should", "expects", "plans", "anticipates",
"believes", "estimated", "predicts", "potential", "continue",
"intends", "could", or the negative of such terms or other
comparable terminology. We made a number of assumptions in the
preparation of these forward-looking statements. You should not
place undue reliance on our forward-looking statements, which are
subject to a multitude of risks and uncertainties that could cause
actual results, future circumstances or events to differ materially
from those projected in the forward-looking statements. These risks
include, but are not limited to, the outcome of our strategic
review, securing and maintaining corporate alliances, the need for
additional capital and the effect of capital market conditions and
other factors, including the current status of our programs, on
capital availability, the potential dilutive effects of any
financing and other risks detailed from time to time in our public
disclosure documents or other filings with the Canadian and U.S.
securities commissions or other securities regulatory bodies.
Additional risks and uncertainties relating to our Company and our
business can be found in the "Risk Factors" section of our Annual
Information Form and Form 20-F for the year ended November 30,
2008, as well as in our other public filings, including our
Management's Discussion and Analysis for the period ended February
28, 2009. The forward-looking statements are made as of the date
hereof, and we disclaim any intention and have no obligation or
responsibility, except as required by law, to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise. The unaudited interim consolidated
financial statements, accompanying notes to the unaudited interim
consolidated financial statements, and Management's Discussion and
Analysis for the three months ended February 28, 2009, will be
accessible on Vasogen's Website at http://www.vasogen.com/ and will
be available on SEDAR and EDGAR. Summary financial tables are
provided below. VASOGEN INC. (A DEVELOPMENT STAGE COMPANY) Interim
Consolidated Balance Sheets (In thousands of Canadian dollars)
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February 28, November 30, 2009 2008
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(Unaudited) Assets Current assets: Cash and cash equivalents $
7,333 $ 8,556 Tax credits recoverable 383 582 Prepaid expenses and
deposits 64 188
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7,780 9,326 Property and equipment 14 16
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$ 7,794 $ 9,342
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Liabilities and Shareholders' Equity Current liabilities: Accounts
payable $ 414 $ 101 Accrued liabilities 781 1,141
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1,195 1,242 Shareholders' equity Share capital: Authorized:
Unlimited common shares, without par value Issued and outstanding:
22,519,737 common shares (November 30, 2008 - 22,424,719) 365,701
365,677 Warrants 16,725 16,725 Contributed surplus 23,971 23,555
Deficit (399,798) (397,857)
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6,599 8,100
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$ 7,794 $ 9,342
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VASOGEN INC. (A DEVELOPMENT STAGE COMPANY) Interim Consolidated
Statements of Operations, Deficit and Comprehensive Income (In
thousands of Canadian dollars, except per share amounts)
(Unaudited)
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Period from December 1, Three months ended 1987 to February 28,
February 29, February 28, 2009 2008 2009
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Expenses: Research and development $ 36 $ 2,778 $ 247,747 General
and administration 2,446 2,681 127,772 Foreign exchange loss (gain)
(30) 203 10,635
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Loss before the undernoted (2,452) (5,662) (386,154) Interest
expense on senior convertible notes payable - - (1,279) Accretion
in carrying value of senior convertible notes payable - - (10,294)
Amortization of deferred financing costs - - (3,057) Loss on
extinguishment of senior convertible notes payable - - (6,749) Gain
on sale of patents 487 - 487 Investment income 24 342 13,862 Change
in fair value of embedded derivatives - - 829
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Loss and comprehensive loss for the period (1,941) (5,320)
(392,355) Deficit, beginning of period (397,857) (381,783) (1,510)
Impact of change in accounting for stock-based compensation - -
(4,006) Impact of change in accounting for financial instruments -
- (1,632) Charge for acceleration payments on equity component of
senior convertible notes payable - - (295)
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Deficit, end of period $ (399,798) $ (387,103) $ (399,798)
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Basic and diluted loss per common share $ (0.09) $ (0.24)
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VASOGEN INC. (A DEVELOPMENT STAGE COMPANY) Interim Consolidated
Statements of Cash Flows (In thousands of Canadian dollars)
(Unaudited)
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Period from December 1, Three months ended 1987 to February 28,
February 29, February 28, 2009 2008 2009
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Cash provided by (used in): Operating activities: Loss for the
period $ (1,941) $ (5,320) $ (392,355) Items not involving cash:
Amortization 2 62 6,379 Loss on disposition of property and
equipment - - 125 Gain on sale of patents (487) - (487) Accretion
in carrying value of senior convertible notes payable - - 10,294
Amortization of deferred financing costs - - 3,057 Loss on
extinguishment of senior convertible notes payable - - 6,749 Change
in fair value of embedded derivatives - - (829) Stock-based
compensation 416 235 10,806 Common shares issued for services - -
2,485 Unrealized foreign exchange gain (38) 192 11,381 Other - -
(35) Change in non-cash operating working capital 299 1,398 737
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(1,749) (3,433) (341,693) Financing activities: Shares and warrants
issued for cash - - 326,358 Warrants exercised for cash - - 16,941
Options exercised for cash - - 7,669 Share issue costs - - (24,646)
Repayment of senior convertible notes payable, net - - 38,512 Paid
to related parties - - (234)
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- - 364,600 Investing activities: Purchases of property and
equipment - - (2,471) Purchases of acquired technology - - (1,283)
Proceeds on disposition of patents 487 - 487 Purchases of
marketable securities - - (244,846) Proceeds on disposition of
property and equipment - - 62 Settlement of forward foreign
exchange contracts - - (4,824) Maturities of marketable securities
- - 240,677
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487 - (12,198) Foreign exchange gain (loss) on cash held in foreign
currency 39 (182) (3,376)
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Increase (decrease) in cash and cash equivalents (1,223) (3,615)
7,333 Cash and cash equivalents, beginning of period 8,556 23,545 -
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Cash and cash equivalents, end of period $ 7,333 $ 19,930 $ 7,333
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DATASOURCE: Vasogen Inc. CONTACT: Investor Relations, 4 Robert
Speck Parkway, 15th Floor, Mississauga, ON, L4Z 1S1, tel: (905)
817-2002, fax: (905) 847-6270, http://www.vasogen.com/,
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