ROCKVILLE, Md., Feb. 6, 2012 /PRNewswire/ -- EntreMed, Inc. (Nasdaq: ENMD), a clinical-stage pharmaceutical company developing therapeutics for the treatment of cancer, announced today that it has received approximately $9.3 million in strategic financing, as previously announced on January 23, 2012. The Company expects to receive the remaining funds on or about February 10, 2012. The financing was led by IDG-Accel China Growth Fund II L.P. and joined by other accredited investors, including Emerging Technology Partners, LLC, and Dr. Tak W. Mak, Director of the Campbell Family Institute for Breast Cancer Research.
As previously announced, the Company issued and sold subordinated convertible notes that automatically convert into shares of common stock upon approval of the Company's stockholders at the 2012 stockholder meeting, which is expected to be held on or about April 30, 2012. The Company has satisfied all closing conditions in the transaction agreement, including an agreement from Celgene Corporation, the sole holder of the Company's outstanding Series A preferred stock, to vote in favor of the transaction at the 2012 stockholder meeting, and upon stockholder approval of the transaction, to waive all accrued dividends on the preferred stock, convert all of its outstanding preferred stock into common stock and to eliminate all preferences associated with the preferred stock, including its governance rights. As a closing condition, the Company has also terminated its Standby Equity Distribution Agreement with Yorkville Advisors."We are appreciative of Celgene's support of this transaction. Their agreement to waive all accrued dividends on the preferred stock and to convert their outstanding preferred stock enhances our balance sheet and improves our capital structure," said Michael M. Tarnow. In connection with the financing, Mr. Michael Tarnow and Mr. Donald Brooks have resigned from the Board of Directors, effective immediately. Mr. Tarnow will provide consulting services to the Company until May 31, 2012 to assist with the transition efforts. Wei-Wu He, Ph.D. has joined the Board of Directors as Executive Chairman, and Dr. Tak W. Mak, Ph.D., has also been elected to the Board of Directors. Mr. Tarnow commented, "This is an exciting time for all of us who are associated with EntreMed. The dedication and work of our employees, the involvement of our Board and the continuing support and patience of our investors have led to significant progress in our clinical program with ENMD-2076. The new funds provided by this strategic financing, coupled with the leadership of Dr. He as Executive Chairman and Dr. Mak as a new Board member, position the Company for a very positive future. I look forward to assisting the Board in managing the transition and to celebrating the Company's future success."