advaxis stonegate report 6-23-2010

8/9/2019 Advaxis Stonegate Report 6-23-2010

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ADVAXIS, INC. (OTC BB: ADXS) June 23, 20

Price ........................................................................................ $0.1852-Week Range .......................................................... $0.02 - $0.26Market Capitalization ................................................ $30,474,397Enterprise Value ......................................................... $35,821,576Basic Shares Outstanding .......................................... 169,302,203Float (Shares) .............................................................. 142,721,757Insider Ownership (%) ........................................................15.7%Institutional Ownership (%)..................................................5.5%Daily Volume (3-Month Avg.) .......................................... 905,155Industry ....................................................................BiotechnologyWebsite ...............................................................www.advaxis.comCorporate Headquarters.............................. North Brunswick, NJ

Company Description

Advaxis, Inc. is a development-stage immune therapy company that is focused on the development of therapeutic canvaccines utilizing attenuated, live Listeria monocytogenes bacteria as a carrier for bioengineered antigens. The Compexclusively licenses this technology from the microbiology laboratory of Dr. Yvonne Paterson at the University of PennsylvaAdvaxis started its Phase II CIN trial in April 2010 and anticipates starting two additional clinical trials in 2010 that advance

previously completed Phase I clinical trial.

Summary

Whats new Advaxis started its Phase II CIN trial in April 2010. Furthermore, it reported results for its Q2F10 via its filing (see pg 10 for details) reached an agreement on its second amendment to its IP licensing agreement with University of Pennsylvania, and completed the draw down of its equity line of credit.

Novel immunological treatment for cancer acts as a differentiator At the core of Advaxis product portfolio ispatented delivery system that uses attenuated, live Listeria monocytogenes (Lm) as its vector to deliver the antigen fusprotein Listeriolysin-O (LLO), which elicits a powerful and comprehensive immunological response. While the poweimmunological response comes from both the innate and adaptive tiers, more importantly, Advaxis vaccine elicitsintratumoral affect. This affect inhibits the regulatory T-cells that are acting to hide cancerous cells, thus increasingability of the bodys immune system to fight the existing cancer and improve remission.

Strong IP portfolio - Advaxis has 27 issued and 45 pending patents covering multiple compositions of matter, methods uses for live Listeria-based vaccines. We note that recently, the Company successfully defended a patent in Europe.

Large addressable market targeted According to BCC Research, the estimated global market for immunotherapies reach $37.2B by 2012, and within that market, the sector with the greatest potential for growth is cancer vaccines.

Valuation Our Comparison Table on page 16 shows the market placing a median market value on cancer biotech firms$112.3M vs. Advaxis market cap of $30.5M.

STONEGATE

S E C U R I T I E S

$0.04

$0.09

$0.14

$0.19

$0.24

$0.29

Ju n- 09 Au g- 09 Se p- 09 No v- 09 De c- 09 F eb -1 0 Ma r- 10 Ma y- 10 Ju n- 1

FY Oct Revs Net Inc EPS P/E Rev Grw (000s) (0

2007 A 154.2$ (5,146.8)$ (0.11)$ nm nm Cash & Cash Equivs $227.2 Working Capital ($7,25

2008 A 65.7$ (5,414.0)$ (0.05)$ nm nm Cash/Share $0.00 Current Ratio

2009 A 29.7$ 929.2$ 0.01$ 24.2x nm Equity (book value) ($21,962.3) Total Debt/Equity

2010 E 292.5$ (20,064.6)$ (0.14)$ nm nm Equity/Share ($0.13) Total Debt/Capital

Source: Company reports, Stonegate estimates

Condensed Income Statements (000s) Condensed Balance Sheet (4/30/10)

See Important Disclosures and Disclaimer on Page 20


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Investment Factors

Advaxis, Inc. is a development-stage biotechnology company that develops proprietaryListeriamonocytogenes-based cancer vaccines. Below we outline important investment points toconsider for Advaxis.

Investment PositivesNovel immunological treatment for cancer acts as a differentiator - At the core of Advaxisproduct portfolio is its patented delivery system that uses attenuated, live Listeriamonocytogenes (Lm) as its vector to deliver the antigen fusion protein Listeriolysin-O (LLO),which elicits a powerful and comprehensive immunological response. We note that theimmunological response comes from both the innate and adaptive tiers. Furthermore, and moreimportantly, Advaxis vaccine elicits an intratumoral affect, which inhibits the regulatory T-cells that are acting to hide cancerous cells. Consequently, the bodys immune system finallysees the cancer and begins to attack it, thus enabling a more successful remission. This laststep is where many immunological vaccines have failed in the past.

Strong IP portfolio Advaxis has 27 issued and 45 pending patents covering multiplecompositions of matter, methods and uses for live Listeria-based vaccines. Advaxis is the

exclusive licensee of these patents based on the work of Dr. Yvonne Paterson at the Universityof Pennsylvania, and the Company has the rights to an extensive portfolio of intellectualproperty, filed both in the U.S. and internationally, pertaining to the use ofListeria and listerialproducts used as vaccine vehicles. Lastly, we note that Advaxis recently defended one of itskey patents in European Patent Court against a challenge made by Anza Therapeutics, Inc.,formerly Cerus Corp.(NASDAQ: CERS). The patent covers the use of bacteria to deliver anantigen and generate an anti-tumor immune response. Advaxis successfully defended thechallenge, and the ruling cannot be appealed.

Large addressable market targeted Currently, cancer is the second leading cause of deathby illness in the U.S. The National Cancer Institute expects cancer to take the lead position inthe U.S. within five years. Advaxis is initially targeting cervical cancer by using its unique

immunological treatment. BCC Research estimates that the global market for immunotherapieswill reach $37.2B by 2012, and within that market, the sector with the greatest potential forgrowth is cancer vaccines.

Recent financings provide capital In September 2009, Advaxis signed an equity line ofcredit for a maximum of $5M until September 2012. In January, March and May 2010, theCompany drew down the full equity line. The Company also issued about $1M in juniorunsecured convertible notes between Nov-09 and Mar-10.

New clinical trial commencements imminent 3 clinical trials that advance Advaxisoriginal Phase I trial should start this year. Its Phase II trial for CIN started in April 2010. TheCervical Cancer (India) trial and its UK Head and neck cancer Phase I/II trial are expected to

commence in Q3/Q4 2010.

STONEGATE S E C U R I T I E S 2


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Investment ChallengesShareholder dilution With no reported revenues, Advaxis is highly dependent on raisingcapital. Furthermore, the Company can not start/complete its Phase II clinical trials until itacquires adequate capital. Lastly, many of the recent financings contain anti-dilutionprovisions and some debt is convertible into equity. The Company currently has 169.3Mshares outstanding, 18.1M options, 80.3M warrants, and potentially an additionally 49.7Mshares to issue from convertible debt. Coupled with a dependence on capital to continue

operations, current shareholders could be diluted.

Going concern opinion expressed by auditors Since its inception, Advaxis has notgenerated significant revenues and consequently has suffered significant net losses. As of April30, 2010, Advaxis reported an accumulated deficit of $29.8M, a shareholder deficit of $21.9Mand negative working capital of $7.3M. Given these figures, Advaxis auditors continue toexpress a going concern opinion.

Attraction of institutional investor capital may prove difficult Tom Moore, CEO, waspreviously the CEO of Biopure Corporation from July 2002 to February 2004 (Other OTC:BPURQ.PK). During his tenure at Biopure, the SEC alleged that in 2003, he, the head ofregulatory affairs (Howard Richman) and general counsel engaged in misleading public

statements about the status of negative results received from the FDA in regard to the approvalof its key drug Hemopure. Mr. Moore settled with the SEC in February 2007 and is subjectedto a five year injunction from violating antifraud provisions of the federal securities laws andpaid a fine. Importantly, Mr. Moore has stated that he relied on Mr. Richman and was thus alsomisled. Given Mr. Richmans actions since the events at Biopure, Mr. Moores statementappears credible. We note that Mr. Richman was permanently barred from serving as an officerof a publicly traded company and paid a fine. Moreover, in March 2009, Mr. Richman pleadedguilty to an obstruction of justice charge for pretending he had terminal cancer and admitted toimpersonating his own doctor to avoid the federal lawsuit filed by federal regulators mentionedabove. While Mr. Richmans actions lend credibility to Mr. Moores statement, institutionalinvestors may nonetheless be hesitant to commit investment capital to Advaxis. Despite thisopinion, we would note that the Company recently raised a maximum of $5M from Optimus

Capital LLC via an equity line of credit.

Rigorous FDA evaluation and approval process Pharmaceutical approvals in the U.S. arestringent and typically unpredictable. Whats more, the clinical trial process is lengthy,expensive, and often fails at various stages. Recent FDA data show evidence of increasedfailure rates with a current 8% probability of a new drug entering Phase I development and itsability to make it to registration versus a historical 14% probability. Furthermore, the FDAmay require additional testing after successful completion of clinical trials if some requiredregulatory criteria are not met. Even if the FDA grants approval, the approval may includelimits on indication uses.

High level of competition may render Advaxis technology obsolete The biotechnology

and biopharmaceutical industries are characterized by rapidly changing markets, technologies,regulatory standards, and frequent new product introductions. Consequently, changes to any ofthe above factors may render Advaxis products obsolete, less competitive or less marketable.

News flow dependent Because Advaxis is an early stage drug development company with noreported revenues, traditional financial analysis is less relevant. Consequently, we believe, ingeneral, that companies operating in the realm of this investment landscape are highlydependent on new flow rather than traditional financial measurement yardsticks. Hence, ifnews flow slows down or is not forthcoming, the stock price could drift lower. Additionally,due to adverse stock market conditions, investors could avoid these types of investmentscausing Advaxis stock to decline.



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Valuation Summary

Advaxis is a development-stage biotechnology company with a novel immunological cancervaccine. At the core of Advaxis product portfolio is its patented delivery system that usesattenuated, liveListeria monocytogenes (Lm) as its vector to deliver the antigen fusion proteinListeriolysin-O (LLO), which elicits a powerful and comprehensive immunological response.

The vaccine has the following affects: An immunological response from both the innate and adaptive tiers An increase in cytotoxic T-cells in tumor A decrease in regulatory T-cells in tumor Consistently breaking of antigen tolerance (inhibitory Tregs) Delivers immediate therapeutic effects Promotes prolonged immunity Sensitive to antibiotics

Additionally, it is a stable vaccine that may be stored frozen; can be grown on completely synthetic

media and

can change the antigen to target any type of cancer or infectious diseaseWhile an approved FDA product is not imminent, the target market opportunity is significant.According to BCC Research, the estimated global market for immunotherapies will reach$37.2B by 2012, and within that market, the sector with the greatest potential for growth iscancer vaccines.

Our Comparison Table shows the market placing a median market value on cancer biotechfirms of $112.3M vs. Advaxis market cap of $30.5M.

We outline potential catalysts for Advaxis over the next two calendar years:

Capital raise(s) ..................................................................................... 2010/2011 Commencement of Phase II trials ....... 2H10 CIN Phase II trial data .. 2011 Definitive licensing agreement ......... 2011 Approval of Fast Track designation .... 2010/2011



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Company Overview

Company Background

Advaxis, Inc. is a development-stage biotechnology company that is developing proprietaryListeria monocytogenes-basedcancer vaccines. Advaxis technology is based on over 20 yearsof research by Dr. Yvonne Paterson, Professor of Microbiology at the University ofPennsylvania and Chairperson of the Advaxis Scientific Advisory Board. In July 2002,Advaxis signed an exclusive 20-year licensing agreement with University of Pennsylvania thatis subject to royalty and milestone obligations. Advaxis trades on the OTC BB under thesymbol ADXS.

Products and Technology

Advaxis lead vaccine candidate is called ADXS 11-001, which uses a patented delivery systemto target various cancers. The Company is targeting cervical cancer, cervical dysplasia, headand neck, breast, and prostate cancers.

Exhibit 1: Product Candidates

Construct Indication

ADXS11-001 (Phase I) Cervical cancer

ADXS11-001 (Phase II) Cervical dysplasia

ADXS11-001 (Phase II) Cervical cancer

ADXS11-001 (Phase II) Cervical cancer

ADXS11-001 (Phase I/II) Head & neck cancer

ADXS31-164 (Phase I) Breast cancer

ADXS31-142 (Phase I) Prostate cancer - PSA secreting cells

Source: Company Reports, Stonegate Securities

At the core of Advaxis product portfolio is its patented delivery system that uses attenuated,live Listeria monocytogenes (Lm) as its vector to deliver a tumor associated antigen fused(TAA) to the protein Listeriolysin-O (LLO), which elicits a powerful and comprehensiveimmunological response. To best understand Advaxis technology, it is helpful to brieflyreview the human immune system.

Immune System ReviewThe immune system is composed of two tiers of protection against foreign invaders.

Tier 1: Innate immune system is the bodys first line of defense and provides an immediateresponse that is non-specific to a pathogen.

Tier 2: Adaptive immune system is the second line of defense and is supported by the innateresponse. This system is not immediate and requires some time to react. It also is antigenspecific meaning that it reacts only to the foreign invader that induced the response.Importantly, the adaptive system retains this response in its memory and is able to exhibit anincreasingly faster and stronger response to combat the pathogen on subsequent exposure. We

also note that there are two pathways that the adaptive system takes to fight invaders.

GATE S E C U R I T I E S 5STONE

Exhibit 2: Mapping The Immune System

Humoral

(B Cells)

Cell mediated

(T Cells)

Humoral

(B Cells)

Cell mediated

(T Cells)

Anatomical

(i.e. Skin)

Source: Company Reports, National Cancer Inst., Stonegate Securities

Innate Immunity Adaptive Immunity

Immune System

Bacteria Bacteria Virus


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Adaptive immune systemresponse - Class II Pathway(Exogenous)

Exhibit 3: The Body's Immune Response

Source: Company Reports; Stonegate Securities

Antigen-presenting cells (APCs)roam inside the body and searchfor foreign invaders. When theyfind an invader, they eat it,

break it down, and push pieces ofit to its surface that act asmolecular targets for the immunesystem. Here, APCs stimulate T-cells to action by presenting themwith a target.

Adaptive cellular immune system response - Class I Pathway (Endogenous)The other response occurs when a cell begins to produce unusual proteins within itself(cytoplasm to be specific). Similar to some of the exogenous steps above, the unusual proteinsare broken down inside the cell, and pieces of it are pushed to the cell surface. Once again,these pieces act as molecular targets for the immune system and call T-cells to come over and

kill it.

T-cells come in many forms and two important ones are: 1) Helper or 2) Killer (cytotoxic).Helper T-cells (CD4+ T-cells) are the middlemen of the immune system that assist in theimmune response by secreting chemicals that enable Killer T-cells to battle. Killer T-cells (alsoknown as cytotoxic T-cells or CD8+ T-cells) destroy infected cells. The destruction of theinfected cells occurs when killer T-cells (CD8+) release cytotoxins that form pores in theforeign cells plasma membrane, enabling granzymes to activate a series of enzymes that leadto the death of the infected cell.

Why use Listeria?Central to the Companys technology is the microbe Listeria monocytogenes. Listeria is a

well-known bacterium in the medical community. It is a pathogen that causes food poising insomeone whose immune system is compromised or who eats a large quantity of it.Importantly, the body has developed (over hundreds and thousands of years) an immediate andpowerful response should it encounter Listeria. Consequently, Advaxis builds on the verypotent immune response toListeria bacterium.

Advaxis engineers a modified Listeria (attenuated version of wild Listeria) to deliver specificcancer antigens. In turn, the modifiedListeria vaccine enlists the immune system to attack theListeria bacteria and simultaneously educate the immune system to attack specific cancercells. Importantly, Advaxis vaccines trigger the two tiers of the cellular immune systemresponse as described above.

Simply put, when Listeria enters the body it elicits an immediate innate immune response.Then, as the Listeria infects antigen-presenting cells (APCs), these APCs direct the immunesystem to attack theListeria as described in the adaptive immune response. In the ADXS 11-001 vaccine, the bacterium is engineered to secrete fragments of HPV-E7, a molecule found onthe surface of malignant cervical cells. The immune system is then triggered to recognize thesecancer cells and destroy them. This sequence of events has been compared to offering abloodhound the scent of its target. By modifying the Listeria bacteria to carry chemical tagsfound in a specific type of cancer, the body directs the immune system to focus its attack on thecancer.



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How does Advaxis vaccine work?

Below in Exhibit 4, we illustrate how Advaxis Listeria vaccine is bioengineered and its mainmechanism of action.


Exhibit 4: Mechanism of Action

STEP 1: THE

CARRIER

Delivery Vector

An attenuated, bioengineeredLm bacterium is

selected as the delivery vector. The bacterium

is attenuated by a factor of 10,000 to 100,000times so it doesn't offer a health risk, but offers

the strong immunicity of a wild Listeria

STEP 2: THE

GENETIC

SEQUENCING

Antigen/Adjuvant

Fusing

A genetic sequence is engineered becoming

the template for a tumor specific antigen

(tumor target). It will be fused to a modified

Lm protein, Listeriolysin-O (LLO) that allows

the bacterium to synthesize and secrete the

active antigen/adjuvant within the target cells

STEP 3: THE

BIOENGINEERING

Plasmids Created and

Inserted

A plasmid containing Advaxis bioengineered

genetic information is created. The antigens

that are currently in Advaxis vaccines are E7

(targets cervical cancer), Her-2 (targets breast

cancer) and PSA (targets prostate cancer)

STEP 4: THE

FACTORY

Advaxis Trojan Horse

The bioengineered plasmids are then inserted

into the livingLm delivery vector system.

These organisms become small biological

factories

Acting as a Trojan Horse, the finished product

is an immunotherapeutic technology that

makes the active drug and secretes it where itis used within the cells

THE ADVAXIS Lm

VACCINE EFFECT

Class I and II Cellular

Immunity

After antigen presenting cells (APC) ingest an

Advaxis bioengineeredLm bacterium, it is

broken down into molecular fragments to be

directed and used as an immune attack target

Pathogens are digested in the phagosomes and

the fragments are used to stimulate Class II

cellular immunity (the exogenous pathway)against the Advaxis bioengineeredLm

bacterium

The Advaxis bioengineeredLm bacterium will

perforate the phagosome membrane, escape

into the cytosol and stimulate Class I cellular

immunity (the endogenous pathway)

Source: Company Reports; Stonegate Securities


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The intratumoral affect

A very unique and important finding of Advaxis vaccine is its ability to alter the tumormicroenvironment. By definition, cancer tumors are cells that have managed to evade theimmune system. It has been discovered that, in essence, cancer cells have hijacked parts ofthe immune system that help protect the body by aiding the immune system in distinguishingbetween self (body) and non-self (foreign invader). Specifically, another type of T cell,Regulatory T-cells (called Tregs) are what inhibit the anticancer response.

AdvaxisListeria vaccines secrete LLO-antigen fusions that reduce intratumoral regulatory T-cells (Tregs) and alter the tumor microenvironment in constructive ways that are unlike anyother vaccine vector. Consequently, the immune system is awakened and sees the oncehidden cancer cells. Furthermore, this action enables the bodys immune system to attack anyfuture growth of the specific cancer and leads to a more successful remission. This last step iswhere many immunological vaccines have failed in the past.

Exhibit 5 illustrates the results from a study that compares two vaccines - one that includes theLLO fusion protein (ADXS11-001), andone that does not. The inclusion of LLOin the vaccine increased the cytotoxic

(tumor killing) T-cell activation by 400%and decreased the inhibitory T-cells by80%.

Exhibit 5: Intratumoral Affect

Vaccine

Activated Tumor

Killing T-Cells (In

the tumor)

Inhibitory T-cells

(in the tumor)

Lm-E7 (- LLO) 9.40% 11.80%

ADXS11-001 (+LLO) 36.80% 1.70%

Source: Company Reports; Stonegate SecuritiesOther effects

Additionally,Listeria stimulates other non-classical mechanisms that act to support the overallimmune response described above. These include: the stimulation of bone marrow to makemore immune cells, the stimulation of blood vessel cells that allow activated immune cells toleave the blood and enter tumors, and other supportive effects.

Listeria made safeAs mentioned, Listeria is known to cause food poisoning and is responsible for, on average,

500 deaths a year in the U.S. Advaxis addresses the safety issue in several ways. First, aspreviously mentioned, Advaxis attenuates itsListeria by a factor of 10,000 to 100,000. Second,Advaxis also performs skin tests on each of the participants in its trials to insure an adequateimmune response before the vaccine is injected. And lastly, following each does, eachparticipant is given a regimen of antibiotics, which kills the remaining bacteria, but has noapparent effect on the memory response that is retained by the immune system.

Advantages of AdvaxisListeria delivery vector vaccinesAdvaxis therapeutic approach differs from other immunotherapies that simply introduce anantigen into the immune system to trigger a response. Below we list why Advaxis vaccine ispotentially more effective versus other solutions:

Listeria has a strong stimulating effect on the innate immune system, which sets thestage for a strong adaptive immune response against a specific target

Listeria infects the immune system and tells it what to attack and can thus efficientlydirect an immune response to attack any type of cancer or infectious disease base onwhatever antigen is bioengineered into a vaccine.

The adaptive immune response is triggered via secreted antigens into the cytosol ofAPCs, which quickly activates T-cells and tells them what to attack

Consistently breaks antigen tolerance (inhibitory Tregs) Promotes prolonged immunity (immune memory) In pre-clinical research, Advaxis Listeria technology has consistently demonstrated

complete therapeutic responses that result in complete tumor regression Sensitive to antibiotics Stable vaccine that may be stored frozen; can be grown on completely synthetic media



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Intellectual Property

As the exclusive licensee of patents based on the work of Dr. Yvonne Paterson at theUniversity of Pennsylvania, Advaxis has rights to an extensive portfolio of IP, filed both in theU.S. and internationally, pertaining to the use ofListeria and listerial products used as vaccinevehicles. The Advaxis patent portfolio consists of 27 issued patents and 45 pending and in-process patents covering multiple compositions of matter, methods and uses for live Listeria-based vaccines. The patents cover 4 different Listeria species and 2 different families ofadjuvant fusions. The patents are filed in the U.S., Japan, Canada, Australia and Europe.

Advaxis works with its patent counsel to surround its product and technology platform withsignificant offensive and defensive patent protection. The Company recently defended one ofits key patents in European Patent Court against a challenge made by Anza Therapeutics, Inc.,formerly Cerus Corp.(NASDAQ: CERS). The patent covers the use of bacteria to deliver anantigen and generate an anti-tumor immune response. Advaxis successfully defended thechallenge, and the ruling cannot be appealed.

Business Strategy

Advaxis business strategy is focused on developing sufficient human clinical data to

demonstrate its effectiveness in combating cancer. Given its early stage business lifecycle, itsbusiness plan has been executed by largely outsourcing virtually all of its major functions.These include: drug development, manufacturing, R&D, grant applications, and clinical studiesamong others. Additionally, the Company is focused on attaining partners to help it conduct itsclinical trials as evidenced by The Cancer Research UK Phase I/II trial, and its GOG/NCI trials.

Longer-term, Advaxis envisions licensing its technology for commercial development. TheCompany does not intend to engage in commercial development beyond Phase II clinical trialswithout partnerships or license agreements.

Financial Model Review

Given the development stage of Advaxis, a clear financial model is not currently defined.

Needless to say, the Company is highly dependent on financing to continue its operations.

hibit 6: Capital Structure

Total Shares Outstanding (000) - as of 4/30/2010 169,302.2

Bridge Notes (convertible) - 926.0$ Series A Prfd Stock - Equity line of credit 5,000.0$

Various notes including senior convertible promissory & Equity line drawn down; 10% int rate payable in Series A

junior sub convertible promissory's. @ 4/30/10 total was Prfd stk; non-convertible; redeemable by Company after

$3.4M; subsequent to quarter, 14.2M shares issued in lieu 5yrs; all 33.75M 3yr warrants exercised & payable in a

of cash & $88K pmt made leaving ~ balance listed 4yr note @ 2%; rcvd xtra 2.8M warrants @ xprice of $0.18

Notes Payable - CEO 650.0$ Warrants 80,

12% interest rate; matures Jan 2010; warrants Almost all warrants contain full ratchet anti-dilution; $0.17

issued on 3-3 basis of $ invested in NP; CEO took trigger price; majority of warrants xprice of $0.17

subordinated position vs. bridge financing note; figureincludes accrued interest Stock Options 18,

Wtd avg price @ $0.16; wtd avg life @ 6 yrs

Notes Payable - BioAdvanced 40.0$

8% interest rate; matured June 09; lender has Other items

extended payment until draw down of equity LC Pmt to U Penn; there are also various other 379.0$

royalty/fees & milestone pmts due upon commercialization

rce: Company reports, Stonegate Securities

As of October 2009, Advaxis projects its subsequent annual operating expenses and preclinicalexpenses at approximately $4.1M. Its cost of its Phase II trials for CIN, late stage cervicalcancer and Head and Neck cancer (see Pipeline section below), are estimated at approximately$8M over the 30 month trial period. Given our estimated cash at about $0.8M - $1.2M ($0.2M



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[cash as of Q2F10 10Q] + $1.3M from Series A preferred equity LC draw down [May-10] lesspayments and cash burn), Advaxis needs to raise capital.

Recent results/whats new

Most significantly, Advaxis started its Phase II CIN clinical trial (see page 12 for details).Additionally, the Company reached an agreement with the University of Pennsylvania to itssecond amendment to its current licensing agreement. This included 27 patents, payment of

$379,000 due in monthly installments over the next 6 months, and an Advaxis exercised optionto 7 additional dockets for cash and stock. In June 2010, Advaxis also plans to sign acooperative R&D agreement with a division of the Department of Homeland Security toconduct a proof-of-concept cattle safety study in late summer 2010. Oral and injection dosingwill be tested in cattle to investigate the safety of Advaxis Listeria in animals. The agreementshould help the Company with additional research and data at a low cost. The Company alsoannounced a veterinary trial using one of its vaccines for the treatment of Osteosarcoma in dogsat the University of Pennsylvania of Veterinary Medicine.

Lastly, Advaxis reported Q2F10 financial results via its 10Q filing. $87K in grant revenueswas recognized and the Company reported a net loss of $9.1M. Subsequent to the quarter,Advaxis drew down the remaining portion of its $5M equity LC. Advaxis received about a net

$1.2M. Warrants given with the equity LC were also exercised and are reflected on Advaxisbalance sheet as a $4.9M stock subscription receivable. Terms of the note are 2% interest rateand with payment due in lump-sum 4 years after the transaction.

Earnings Model Assumptions

We modeled $205,000 in revenues for FY10, which represents a NIH grant (awarded inQ4FY09). We model operating expenses of $6.9M for FY10. Our FY10 expenses are basedon a monthly cash burn of approximately $255,000 plus incremental monthly expenses forclinical trials commencing (CIN, India trial and Head and neck; see Pipeline section, below).We also assume that Advaxis raises an additional $5M via a common equity offering (exclusiveof Equity LC which we assume is used to repay existing bridge loans), which drives our FY10share count.

Pipeline

Advaxis is targeting multiple clinical trials targeting CIN and several HPV-related cancers.Below we illustrate the Companys programs. We note that the CIN, Cervical Cancer(GOG/NCI), Cervical Cancer (India) and Head and Neck Cancer are trials that are building onAdvaxis 2007 completed Phase I trial (first one listed below).

Exhibit 7: Clinical Trial Program

Product

Name Indication

Cancer

Stage Sponsor

Pre-

Clinical

Phase

I

Phase

II

Phase

III

ADXS11 -001 Cervical cancer Late Advaxis

ADXS11 -001 Cervical dysplasia (CIN) Early Advaxis

ADXS11 -001 Cervical cancer Late GOG/NCI

ADXS11 -001 Cervical cancer Late India

ADXS11 -001 Head & neck cancer Late CRUK

ADXS31 -164 Breast cancer Late US

ADXS31 -142 Prostate cancer Late Advaxis


Pre-clinical resultsIn pre-clinical studies involving animals that have been injected with cancer cells to generate a5mm tumor, results showed that administering different Lm vaccines in many cancer models



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led to complete tumor clearing of pre-existing tumors in approximately 75% of the animals.The pre-clinical trial demonstrated:

100% tumor clearance of pre-existing tumors in 50% to 100% of normal animalsthrough use of differentLm vaccines in many cancer models.

25% to 50% tumor clearance in transgenic animals, which tend to be the most difficultto treat.

In the animals that had a favorable response to the vaccine, re-inoculated tumor cellswould not grow even after waiting several months, indicating long-term immunity.The results are also impressive when compared with other live vaccines in an independentanimal trial. The National Cooperative Drug Discovery Group at the National Cancer Instituteasked several labs to provide their most effective cancer vaccine to participate in a comparisontest. As indicated in Exhibit 8, ADXS 11-001 outperformed the participants that includedVaccinia, DNA and peptide vaccines.

Exhibit 8: NCI Tumor Vaccine Test

Vaccine

ADXS11-001

LmE7Vac-SigE7

Vac E7

E7-DNA

E7-DNA in SBAS2

Db peptide in SBAS2


0

0

0

0

% Tumor Free Mice

50 - 100

00 - 25

Phase I ADXS11-001 cervical cancer trial

In October 2007, Advaxis concluded its first human clinical trial using live attenuated Lmvaccine (ADXS 11-001). The clinical trial included 15 patients with progressive, recurrent,metastatic squamous cell carcinoma of the cervix who had failed to respond to chemotherapy,radiotherapy and/or surgery. The participants were divided in three cohorts of five patients:

Cohort I - 1 x 109

, Cohort II - 3.3 x 109

and Cohort III - 1 x 1010

. Each of the cohorts receivedtwo infusions of ADXS 11-001 that were administered 21 days apart. Each of the doses wasfollowed after five days with a regimen of ampicillin. Follow up visits were at three weeks andthree months following the second dose.

Toxicity was limited to flu-like symptoms comprised of fever, chills and nausea. Higher feverand hypotension occurred in Cohort III; however, the patients side effects, including thehypotension, promptly responded to symptomatic treatment withnon-prescription non-steroidalanti-inflammatory drugs (NSAIDs) and anti-emetics without the need for early antibiotics.

Although the trial was not designed to evaluate efficacy, RECIST criteria survival data from 13eligible patients were analyzed. The overall median survival for patients in the Advaxis trial

was 347 days, and over two years for two patients who are alive at the time of this writing.This is particularly noteworthy given that the survival of patients in the metastatic, refractory orrecurrent ICC is only three to six months. Additionally, we note that 4 of 13 (30%) evaluablepatients experienced tumor reduction.


Exhibit 9: Survival - ADXS11-001 vs. GOG Historical Data

12-Month

Survival

(%)

Median

Survival

(Days)

Still Alive

(Days)

GOG Standard 5 180 NA

ADXS11-001 Phase I

Clinical Trial

53 347 1,000+

Source: Gynecologic Oncology Group (GOG), Advaxis, Inc., Stonegate Securities


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Exhibit 10: ADXS11-001 Phase 1 Efficacy Trial Study

# Patients Percent

Tumor progression 5 38.5%

Tumor stablization 7 53.8%

Tumor reduction 4 30.7%

Unconfirmed partial tumor response 1 7.7%


Phase II ClN clinical trialOn April 15, 2010, Advaxis initiated its first site for its multicenter CIN trial. The trial is arandomized, single blind, placebo-controlled Phase II clinical trial of ADXS11-001 for thetreatment of cervical intraepithelial neoplasia (CIN). The study is designed to assess safety andefficacy. Numoda Corporation will administer the clinical trial. The Company completeddosing of three patients in June 2010.

Other vaccines in the Advaxis pipeline

Advaxis technology can bioengineer dual antigen systems that have the capability of attackingtwo different cancer targets using a single vaccine. Recently, Advaxis announced the Companyis a recipient of a $210,000 grant from the U.S. National Institutes of Health (NIH) to develop asingle Lm vaccine that delivers two different antigen-adjuvant proteins to attack two separate

and distinct tumor targets. Further research isfocused on a dual delivery system using a tumorcell surface marker to kill tumor attack tumor cells,combined with anti-angiogenesis to impair atumors ability to grow by reducing its bloodsupply.

Exhibit 11: Other Vaccines in the Pipeline

Antigen Indication

HWM-MAA Anti-angiogenesis, melanoma

p53 Many types of cancer

WT-1 Lymphomas; leukemias

PSCA Prostate cancer

Telomerase Many types of cancer

Survivin Ovarian cancer


In Exhibit 15 (see appendix on page 15), weprovide an estimated timeline as it relates toAdvaxis clinical trials.

Industry Overview

Industry Background

The goal of immunology research is to develop methods that exploit the natural tendency of thehuman body to defend itself against disease. Researchers once believed that the immunesystem was limited to combating infectious diseases caused by bacteria and viruses; however,years of research have created some successful examples of immunotherapies for cancer. Thelaunches of Merck (NYSE: MRK) and Sanofi Pasteur MSD's Gardasil (FDA approved in2006) and GlaxoSmithKlines (NYSE: GSK) Cervarix (approved in EU in 2007) havesignificantly boosted clinical interest in cancer vaccines. BCC Research estimates that theglobal market for immunotherapies will reach $37.2B by 2012, and within that market, thesector with the greatest potential for growth is cancer vaccines.

The cancer vaccine market consists of two types of vaccines:

Prophylactic cancer vaccines - designed to prevent the development of cancer; given tohealthy subjects to prevent infection with cancer-causing viruses

Therapeutic cancer vaccines - designed to treat existing cancers; given to cancerpatients to stimulate the immune system into recognizing and attacking existing cancer

Prophylactic vaccines (Gardasil and Cervarix) control the cancer vaccine sector, andresearch firm Espicom Business Intelligence expects that portion of the market to reach $4B by2011. While there are currently no sales in the therapeutic market (where Advaxis ispositioned), Espicom is optimistic regarding the potential of that market, forecasting sales to



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reach $5B by 2012. The optimism is largely predicated on the recent changes in the landscapeof the therapeutic cancer vaccine market, which is shifting from a product pipeline filled withvaccines in Phase I and II stages, to a more mature pipeline with multiple products in Phase IIItrials (see Exhibit 14 on page 14). The Phase III candidates are targeting high profile cancers,including melanoma, prostate, non-small lung, renal cell, and colorectal cancers.

Current target markets

Currently, cancer is the second leading cause of death by illness in the U.S. The NationalCancer Institute expects cancer to take the lead position in the U.S. within five years. TheNational Institutes of Health estimate overall costs of cancer in 2008 at $228.1B, of which$93.2 is in direct medical costs, $18.8M in costs due to lost productivity, and $116.1M in costsdue to lost productivity from premature death.

Because cancer disproportionately strikes older people, demographic trends present a strongpush for long-term growth. In the U.S., the Census Bureau estimates that there are about 303Mpeople. Of this, approximately 13% is aged 65+ with expansion to about 20% in 2030. In2006, people over 65 accounted for over one-third of the U.S.s total consumption ofprescription medicines. Additionally, world population stands at about 6.6B with projectionsby the United Nations to reach 9.1B in 2050. The percentage of people aged 60+ will increase

from 11% in 2006 to 22% in 2050. The prediction for Europeans aged 60+ is to move from21% of the population in 2006 to 34% by 2050, and developing countries forecast is to movefrom 8% in 2006 to 20% in 2050.

Exhibit 12: Demographics As A Driver

Source: US Census Bureau, United Nations, Stonegate Securities

0%20%40%60%80%

100%

2006 2030

US

Age


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Exhibit 14: Therapeutic Cancer Vaccines in Late-Stage Clinical Trials

Antigenics, Inc

(AGEN)

Oncophage approved in Russia;

QS-21 in Phase III trials for

treatment of melanoma and non-small cell lung cancer

Antigenics' patient-specific cancer v

adjuvant treatment of kidney cancer pat

authorization application to th

approval for Oncophage in earlier-stagimmune adjuvant in Phase III trials incl

Biovest International

(BVTI.OB)

Phase III trials for treatment of non-

Hodgkin's lymphoma

Biovest International develops person

Biovest is the holder of a Cooperative

National Cancer Institute for the comm

therapeutic cancer vaccine for the treatm

as BiovaxID, is currently in a phase III

GenVec

(GNVC)

Phase III trials for advanced

pancreatic cancer (canceled

3/29/10)

GenVecs discontinued its pivotal, Pha

pancreatic cancer on March 29, 2010. I

TNFerade has also been and is currentl

several other cancers, including esophag

Dendreon

(DNDN)

Two Phase III trials completed

targeting advanced prostate cancer

Provenge, which is used to fight adva

approved cancer vaccine either later this yProvenge would be approved if the v

IMPACT trial. Results from an integr

and D9902A, demonstrated a survival

those randomized to placebo.

Onconthyreon's

(ONTY)

Phase IIb trials for advanced non-

small cell lung cancer and Phase III

trials for non-small cell lung cancer

and breast cancer

Onconthyreon just announced positiv

with the cancer vaccine, Stimuvax, for

patients with stage IIIb/IV non-small ce

wide development and commercializati

currently conducting Phase III trials of


accine, Oncophage is currently approved in Russia for th

ients. In October 2008, Antigenics submitted a marketin

e European Medicines Agency (EMEA) requesting conditional

e, localized renal cell carcinoma. Antigenics QS-21 is anuding non-small cell lung cancer, melanoma and malaria

alized immunotherapies for cancers of the blood system.

Research and Development Agreement (CRADA) with th

ercialization of BiovaxID, a personalized biologic

ent of non-Hodgkins lymphoma. This therapy, referred

pivotal trial at 24 major medical institutions in the US.

se III clinical trial of TNFeradefor locally advanced

nterim results showed it was unlikely to prove effective.

y being evaluated for its potential use in the treatment of

eal cancer, rectal cancer, and head and neck cancer.

nced prostate cancer, will possibly become America's first

ear or sometime in 2010. The FDA has stated thataccine met survivability endpoints in the recently complete

ated analysis of two Phase III studies of PROVENGE, D99

advantage for patients randomized to PROVENGE versu

e results of a study involving patients who received treatm

between 2 and 8.2 years as part of the Phase IIb trial in

ll lung cancer. Merck KGaA is responsible for the worl

on of Stimuvax under license from Oncothyreon and is

Stimuvax in both NSCLC and breast cancer.

The biotechnology and biopharmaceutical industries are characterized by intense competition,rapid technological change and a high degree of uncertainty. Furthermore, the industry is fairlyfragmented with various sized companies attempting to develop and commercialize newtreatments for cancer. Although therapeutic vaccines have shown great promise in clinicaltrials, these results have not yet translated into approved therapies. Therapeutic cancer vaccinecompanies are using a variety of vectors that have very different mechanisms of action. Theadvantages ofListeria monocytogenes over other vectors are listed on page eight.

Advaxis lead product candidate ADXS11-001 targets cervical cancer, the second leading causeof cancer death for women, and cervical intraepithelial neoplasia (CIN), a condition that ischaracterized by the presence of abnormal cells on the cervix that can develop into cancer.According to the National Cancer Institute (NCI), in 2009 an estimated 11,270 women will bediagnosed with cervical cancer. The NCI projects that in 2009 another 1.7M women will bediagnosed with CIN. There is currently no FDA-approved therapeutic for cervical cancer, andalthough CIN can be treated with Loop Electrosurgical Excision Procedure (LEEP) or with

cryotherapy, the recurrence rates following these treatments vary from 10% to 15%.

Additionally, many head and neck cancers are also related to the human papilloma virus. TheAmerican Academy of Otolaryngology estimates that 55,000 people in the U.S. will developsome form of head and neck cancer in 2009. An estimated 25% of head and neck cancersexpress HPV antigens. Studies suggest that HPV may also play a role in cancers of multipleareas of the body including the lung, prostate and other areas.

Competition

Exhibit 14 lists several immunotherapy companies with therapeutic cancer vaccines that are inlate-stage trials. We note that none of these companies employsListeria as a delivery vector.


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Appendix

Exhibit 15: Clinical Trial Estimated Timeline

Product

Candidate Indication (Sponsor) 2010 2011 2012 2013 2014 2015

ADXS11-001 CIN (Advaxis) (1) (2)

Patients (80); Estcost ($5.7M-$6.0M)

ADXS11-001 Cervical cancer

(GOG/NCI) (1) (2)

Patients (63); Est

cost ($2.5M-$3.0M)

ADXS11-001 Cervical cancer (India)(1) (2)

Patients (110); Est

cost ($2.1M-$2.3M)

ADXS11-001 Head & neck cancer

(CRUK) (2) (3)Patients (~45); Est

cost ($0.5M; $2.5M-

$3.0M funding from

CRUK)

ADXS31-164 Breast cancer (DOD) (2)

Patients (TBD); Est

cost ($3.0M-$3.5M)

ADXS31-142 Prostate cancer

(Advaxis) (2)Patients (TBD); Est

cost ($3.0M - $3.5M)(1) These trials are using clinical data derived from the 2007 completed Phase I cervical cancer trail

(2) Subject to financing

(3) CRUK is the Cancer Research UK; announced February 2010

Source: Company Reports, Stonegate Securities estimates based on Company input and FDA averages

Phase II Phase III

Phase II Phase III

Phase I Phase II P

Phase I Phase II

Phase I/II Phase III

Phase II Phase III

STONEGATE S E CUR I T I E S 15


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GATE S E CUR I T I E S 16

Comparison Table

Exhibit 16: Comparative AnalysisAdvaxis Inc (OTCBB: ADXS)

(all figures in $M expect per share information)

Name Ticker Price (1) Sh Mrkt Cap EV

Cancer Vaccines

Dendreon Corp DNDN 34.56$ 135.2 4,673.9$ 4,089.8$

GenVec Inc GNVC 0.50$ 128.9 64.5$ 21.3$

Oncothyreon Inc ONTY 3.48$ 25.8 89.6$ 60.6$

Biovest International Inc BVTI 1.40$ 96.5 135.0$ 108.5$

Antigenics, Inc AGEN 0.88$ 94.2 82.9$ 9.0$

Hi 4,673.9$ 4,089.8$Low 64.5$ 9.0$

Average 1,009.2$ 857.8$

Median 89.6$ 60.6$

Other Cancer

Seattle Genertics, Inc SGEN 12.69$ 100.8 1,279.5$ 961.2$

Allos Therapeutics, Inc ALTH 6.34$ 105.2 667.2$ 530.0$Infinity Pharmaceuticals, Inc INFI 6.22$ 26.2 163.0$ 30.1$

Idera Pharmaceuticals, Inc IDRA 3.71$ 23.49 87.1$ 53.5$

Sunesis Pharmaceuticals Inc SNSS 0.55$ 57.98 31.9$ 17.2$

Hi 1,279.5$ 961.2$Low 31.9$ 17.2$

Average 445.7$ 318.4$Median 163.0$ 53.5$

Universe:

Hi 4,673.9$ 4,089.8$

Low 31.9$ 9.0$

Average 727.5$ 588.1$

Median 112.3$ 57.0$

Advaxis Inc. (2) ADXS 0.18$ 169.3 30.5$ 35.8$

(1) Previous day's closing price

(2) ADXS' EV calculated using face value of debt outstanding and preferred stock value

Source: Company reports, CapitalIQ, Stonegate Securities

STONE


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STONEGATE S E C U R I T I E S

Balance Sheets

17

Advaxis Inc (OTCBB: ADXS)

Consolidated Balance Sheets (in thousands $)

Fiscal Year: October

2008 2009 Q1 Q2

ASSETS Jan-10 Apr-10

Current Assets

Cash & cash equivalents $59.7 $659.8 $1,114.0 $227.2

Prepaid expenses 38.9 36.4 42.9 65.0

Total Current Assets 98.6 696.3 1,156.9 292.2

Property and equipment, net 91.1 54.5 55.1 45.4

Intangible assets, net 1,137.4 1,371.6 1,449.9 1,486.3

Deferred costs - 288.5 247.5 206.5

Other assets 3.9 303.4 6.1 20.7

Total Assets $1,331.0 $2,714.3 $2,915.5 $2,051.2

LIABILITIES AND STOCKHOLDERS' EQUITY

Current LiabilitiesAccounts payable $998.9 $2,368.7 $2,659.5 $1,782.9

Accrued expenses 603.3 917.3 673.0 748.5

Convertible bridge notes & FV of derivative - 2,078.9 2,646.0 4,073.7

Notes payable & interest payable 563.3 1,121.1 1,155.8 940.7

Total Current Liabilities 2,165.5 6,485.9 7,134.3 7,545.8

Long-Term Liabilities

Notes payable 4.8 - -

Common stock warrants - 11,961.7 12,665.2 16,467.8

Total Long-Term Liabilities 4.8 11,961.7 12,665.2 16,467.8

Stockholders' Equity

Issued shares 109.3 115.6 127.2 142.8

Additional paid-in capital 16,584.4 754.8 5,619.7 12,572.1

Stock subscription receivable - - - (4,881.7)

Accumulated deficit (17,533.0) (16,603.8) (22,630.9) (29,795.5)

Total Stockholders' Equity (deficit) (839.3) (15,733.3) (16,883.9) (21,962.3)

Total Liabilities and Stockholders' Equity $1,331.0 $2,714.3 $2,915.5 $2,051.2

Ratios

Liquidity

Current Ratio 0.0x 0.1x 0.2x 0.0x

Quick Ratio 0.0x 0.1x 0.2x 0.0x

Working Capital ($2,066.9) ($5,789.6) ($5,977.4) ($7,253.5)

Leverage

Debt To Equity nm nm nm nm

Debt To Capital nm nm nm nm

Capital Usage -Annualized

A/R Turns nm nm nm nm

Inv Turns nm nm nm nm

A/P Turns nm nm nm nm



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Cash Flows

Advaxis Inc (OTCBB: ADXS)

Consolidated Statements of Cash Flows

Fiscal Year: October

2008 2009 Q1 Q2

Cash Flow from Operations Jan-10 Apr-10

Net income (loss) (5,416.4) 929.2 (4,061.4) (13,191.7)

Adjustments to reconcile net income to net cash :

Depreciation of property and equipment 36.1 36.6 9.4 19.1

Amortization of expense of intangibles 161.2 74.5 21.3 43.5

Amortization of deferred financing costs - 61.5 41.0 82.0

Amortization of discount on bridge loans - 123.8 225.3 480.7

Non-cash charges to consultants 355.4 571.5 188.2 268.7

Gain on note retirement - - - (64.4)

Accrued interest on note payable - - - -

Value of penalty shares issued 31.8 - - -

Non cash interest charge 7.9 698.7 1,433.4 2,818.7

(Gain)/loss on change in value of warrants - (5,845.2) 1,090.1 6,875.4

Changes in operating assets and liabilities:

Other assets - - - (14.5)

Accounts payable 211.6 1,421.8 441.8 (461.0)

Deferred revenue - - - -

Accrued expenses 298.3 (109.5) (244.2) (168.8)Prepaid expenses 161.1 2.4 (6.5) (28.6)

Deferred expenses - - - -

Interest payable - - - (161.2)

Impairments of intangible assets - - - -

Net cash provided by operating activities ($4,153.1) ($2,034.6) ($861.5) ($3,502.0)

Cash Flow from Investing

Purchase of property and equipment (10.8) - (10.0) (10.0)

Costs of intangible assets (200.5) (308.7) (99.5) (158.2)

Net cash used by investing activities ($211.3) ($308.7) ($109.5) ($168.2)

Cash Flow from Financing

Net proceeds (payments) on convertible debt - - -

Net proceeds (payments) on notes payable 460.2 3,243.0 259.1 (135.2)

Net proceeds from issuance of preferred stock - - 1,166.0 3,202.8Proceeds from issuance of common stock (78.0) - - -

Proceeds from exercise of warrants - - - 170.0

Cash paid for deferred financing costs - (299.5) - -

Net cash provided (used) by financing activities $382.2 $2,943.5 $1,425.1 $3,237.7

Net increase (decrease) in cash (3,982.2) 600.1 454.1 (432.6)

Cash and cash equivalents, beginning of year 4,042.0 59.7 659.8 659.8

Cash and cash equivalents, end of period 59.7 659.8 1,114.0 227.2




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Important Disclosures and Disclaimer

(a) Stonegate Securities, Inc. (Stonegate) expects to receive or intends to seek compensation forinvestment banking or other business relationships with the covered companies mentioned in thisreport in the next three months.

(b) The Research Analyst principally responsible for the preparation of this report has received compensation thatis based upon, among other things, Stonegates investment banking revenues.

(c)

Within the last twelve months, Stonegate has received compensation for investment banking services fromthe Company and has a non-exclusive placement agency agreement in place as of 6/24/2009; Stonegate isengaged to provide research and institutional investor awareness for the Company and may assist thecompany in raising capital. As compensation, Stonegate received compensation of $100,000.

(d) Within the last twelve months, Stonegate has not managed or co-managed a public offering for the Company.(e) Stonegate and/or its employees, officers, directors and owners do not own options, rights or warrants to

purchase this security.(f) Stonegate does not make a market in this security.(g) No employee of Stonegate serves on the Companys Board of Directors.(h) A Research Analyst and/or a member of the Analysts household do not own shares of this security.(i) A Research Analyst and/or a member of the Analysts household do not serve as an officer, director, or

advisory board member of the Company.(j) This security is eligible for sale in one or more states.(k) This security is not subject to the Securities and Exchange Commissions Penny Stock Rules, which may set

forth sales practice requirements for certain low-priced securities.(l) Stonegate or its affiliates do not beneficially own 1% or more of an equity security of the Company.(m)Stonegate does not have other actual, material conflicts of interest in the securities of the Company.Meaning of Ratings - Stonegate does not rate the securities covered in its information memorandums.Distribution of Ratings - Stonegate does not rate the securities covered in its information memorandums.Price Chart - Stonegate does not have, nor has previously had, a rating for any securities of the Company.Price Targets - Stonegate does not have a price target for any securities of the Company.

Regulation Analyst Certification:I, Marco Rodriguez, CFA, hereby certify that all views expressed in this report accurately reflect my personalviews about the subject company or companies and its or their securities. I also certify that no part of mycompensation was, is, or will be directly or indirectly related to the specific recommendations or views expressed

in this report.

For Additional Information Contact:

Stonegate Securities, Inc.Marco Rodriguez , [email protected]

Please note that this report was originally prepared and issued by Stonegate for distribution to their market professional and institutionalinvestor customers. Recipients who are not market professional or institutional investor customers of Stonegate should seek the advice of theirindependent financial advisor prior to taking any investment decision based on this report or for any necessary explanation of its contents. Theinformation contained herein is based on sources which we believe to be reliable, but is not necessarily complete and its accuracy cannot beguaranteed. Because the objectives of individual clients may vary, this report is not to be construed as an offer or the solicitation of an offer tosell or buy the securities herein mentioned. This report is the independent work of Stonegate Securities and is not to be construed as havingbeen issued by, or in any way endorsed or guaranteed by, any issuing companies of the securities mentioned herein. The firm and/or its

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advaxis stonegate report 6-23-2010

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