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TORONTO, Dec. 29, 2016 /CNW/ - GeneNews Limited
(TSX:GEN) ("GeneNews" or the "Company") today announced that it has
closed, for gross proceeds of approximately $721,000, its previously announced brokered
private placement (the "Offering") of up to $3 million principal amount of convertible
unsecured debentures (the "Debentures").
"While there is still interest in the debenture, we have taken
the decision to truncate the Offering due to the current market
conditions," said GeneNews' Chairman and CEO, James Howard-Trip.
"When we initiated the Offering, the trading price of our common
shares was approximately $0.50. Since
then, however, it has been under considerable price pressure. We do
not believe it is in the interests of either our shareholders or
the Company to leave the Offering open over the holidays. We are,
therefore, closing it out."
Mr. Howard-Tripp continued, "From an operational perspective, we
continue to execute against plan which, as we have stated, is to
continue to enroll the NueHealth physicians, grow revenue, and sign
additional healthcare groups to our early cancer diagnostic tests.
We look forward to updating stakeholders in more detail when we
announce our fourth quarter and full-year 2016 financial
results."
The Debentures have a term of three years and bear interest at a
rate of 8% per annum, payable semi-annually in arrears, in cash.
Payment of principal is payable in cash or common shares of the
Company ("Common Shares") at the discretion of the Company, subject
to the approval of the Toronto Stock Exchange (the "TSX"). If the
Company elects to pay the principal in Common Shares, the number of
Common Shares issued will be determined based on a 10% discount to
the 5-day volume weighted average trading price ending on the
trading day immediately preceding the date that the principal
amount is due.
Each Debenture will be convertible, at the option of the holder,
into Common Shares at a conversion price of $0.50, beginning six months after the initial
closing date. Each Debenture will be convertible, at the option of
the Company, at a conversion price of $0.50, beginning twelve months after the closing
date, provided the price of the Common Shares has been at or above
$0.75 for 20 consecutive trading
days.
The net proceeds of the sale of Debentures will be used to repay
current debt and payables, and to launch new products.
The Agents will be paid up to 8% cash commission and broker
warrants equal to up to 8% of the value of the Offering.
The Offering is subject to a number of conditions precedent,
including, without limitation, receipt of the approval of the
TSX.
This press release does not constitute an offer to sell or
the solicitation of an offer to buy any securities of GeneNews in
the United States nor shall there
be any offer, solicitation or sale of the Debentures in any state
or other jurisdiction in which such an offer, solicitation or sale
would be unlawful. The Debentures described in this press release
(and any Common Shares issued upon the conversion or maturity of
the Debentures) have not been and will not be registered under the
United States Securities Act of 1933, as amended (the "U.S.
Securities Act"), or any state securities laws and may not be
offered or sold within the United
States or to, or for the account or benefit of, "U.S.
persons," as such term is defined in Regulation S under the U.S.
Securities Act, unless an exemption from such registration is
available.
About GeneNews
GeneNews is committed to becoming a leader in advanced
diagnostics and personalized medicine, serving as a strong
commercialization outlet for early detection of cancer and other
chronic diseases. Our mission is to identify, assess and make
commercially available a comprehensive menu of diagnostics that
provide physicians and patients with personalized clinical
intelligence and actionable information to improve health out-comes
through the early diagnosis of disease. Our Richmond, Virginia-based Innovative
Diagnostics Laboratory clinical reference lab specializes in
traditional and advanced clinical evidence-based blood testing that
helps find, understand, and address cancer risk in patient
populations. Currently, IDL offers risk assessment blood tests for
the three most prevalent cancer types - colon, lung and prostate.
GeneNews' common shares trade on the Toronto Stock Exchange under
the symbol 'GEN'. More information on GeneNews can be
found at www.GeneNews.com.
Forward-Looking Statements
This press release contains forward-looking statements
identified by words such as "expects", "will" and similar
expressions, which reflect the Company's current expectations
regarding future events, including the closing of the Offering on
the terms set out above, expectations regarding use of proceeds,
the receipt of regulatory approvals, the launch of ColonSentry®
test across the United States and
the assembling of a robust menu of other advanced cancer tests to
be offered by IDL. The forward-looking statements involve risks and
uncertainties, including market reaction to the Offering, the
Agents' ability to successfully market the Debentures based on
market conditions, the completion of satisfactory due diligence by
the Agents and the launch of the ColonSentry® test into new
regions, that could cause the Company's actual events to differ
materially from those projected herein. Investors should consult
the Company's ongoing quarterly filings and annual reports for
additional information on risks and uncertainties relating to these
forward-looking statements. The reader is cautioned not to rely on
these forward-looking statements. The Company disclaims any
obligation to update these forward-looking statements, except as
required by law.
SOURCE GeneNews Limited