TIDMEGI
RNS Number : 5476Y
Electrical Geodesics, Inc
06 March 2017
Electrical Geodesics, Inc.
Business Update
EUGENE, OREGON, US, 6 March 2017 - Electrical Geodesics, Inc.
("EGI" or the "Company"), a leading neurodiagnostic medical
technology company makes the following business update.
As reported on January 13, 2017 the company's preliminary,
unaudited revenues grew 5% over the prior year to $14.3m with the
lower than expected growth reflecting uncertainties arising from
the US election results and consequent impacts on research funding
and the challenges to international sales from the strength of the
US currency. Whilst the Company's near-term sales prospects remain
broadly consistent with expectations, these financial and market
factors have continued to influence unfavourably the timing of
sales and receipt of cash into the business.
In order to improve the Company's ability to manage its cash
requirements as the current market factors prevail the Company is
pleased to announce that it has recently closed a debt financing
which has provided the Company with additional working capital.
The Company has entered into a subordinated secured Promissory
Note with the principal amount of $1,000,000, 12% interest,
maturing one year from the date of issuance. Significant other
terms of the promissory note are set out at the end of this
announcement.
Furthermore, the Company recently entered into amendments to its
revolving credit facility extending the facilities maturity date by
twelve months to June 2018 and increasing the credit line from
$2.0m to $2.3m.
On an unaudited basis, the Company's cash reserves at 28
February 2017 (adjusted for the net proceeds from the Promissory
Note) were approximately $1.9m and borrowings under the Company's
revolving credit facility were $1.4m. The Directors are continuing
to monitor the Company's cash availability and will seek to manage
its cash position through additional debt or equity financing and
cost controls as required .
The Company is pleased to report the issuance of a European
patent on a novel invention for constraining dense array EEG source
analysis with anatomical information from neural fiber tractography
and, conversely, using the physiological covariance of dense array
EEG sources to identify accurate fiber tract reconstruction. The US
patent has been applied for and is under review. This invention is
key to understanding the way in which the electrical activity in
any one patient is linked to that patient's unique brain anatomy.
It will provide a key competitive advantage for the Company's
multimodal neuroimaging products in clinical neuroscience
applications in neurology, psychiatry, and neurosurgery.
This announcement contains inside information as defined in
Article 7 of the Market Abuse Regulation No 596/2014 and is
disclosed in accordance with the Company's obligation under Article
17 of those Regulations.
For more information contact:
EGI
Ann Bunnenberg +1 541 687 7962
Peel Hunt LLP (NOMAD
and Broker)
James Steel, Oliver +44 (0) 20 7418
Jackson 8900
Additional details of the Promissory Note
-- A minimum of one-year's interest will be due to the Holder if
EGI prepays prior to the maturity date; change of control would
trigger a premium to be paid to the Holder of $250,000.
-- Assuming no earlier pre-payment, upon maturity on February
28, 2018, EGI will issue the note-holder warrants to purchase
867,152 shares of EGI's common stock at an exercise price in US
dollars of $1.15 (calculated at the exchange rate prevailing at
maturity and representing a premium of 20% over the US
dollar-equivalent of the last reported sale price of EGI shares on
AIM on February 28, 2017). If not exercised, the warrants will
terminate five years from issuance.
-- The promissory note is secured by a subordinated security
interest in the assets of the Company.
Placement fees and related expenses amounted to approximately
$100,000.
Special Note Regarding Forward Looking Statements
All statements, other than statements of historical fact, are
forward-looking, including, without limitation, statements
regarding: future operating results; market conditions and
opportunities; timing and amount of expected orders and shipments;
growing interest in EGI's core products; impact of new product
releases and clinical sites on sales; new products expected to
provide attractive growth opportunities; outcome of clinical trials
and their ability to assess safety and feasibility; reviewing
potential financing options and their ability to assist the Company
in maximizing its growth opportunities; and confidence about the
revenue opportunities for the first quarter and year of 2017. Words
such as "believe," "anticipate," "expect," "estimate," "project,"
"will be," "will continue," "will likely result," or words or
phrases of similar meanings identify forward-looking statements.
Forward-looking statements reflect management's current
expectations, plans or projections and are inherently uncertain and
actual results could differ materially from such expectations,
plans or projections. Investors are cautioned not to place undue
reliance on these forward-looking statements, which speak only as
of the date of this press release. Risks and uncertainties that
could cause actual results to differ significantly from
management's expectations include, but are not limited to, the
following: EGI's limited financial and other resources; potential
period-to-period revenue or expense fluctuations; production
factors and timely access to raw materials; industry cost factors
and conditions; competition; impacts of the repeal of the
Affordable Care Act and new Presidential administration in the US;
government regulation; labor disputes; technological changes;
continued strengthening of the US Dollar against other world
currencies; and other international business risks. Additional
risks and uncertainties not presently known to EGI or which EGI
currently deems immaterial also may impair its business or
operations. EGI does not intend to release publicly any revisions
to any forward-looking statements contained herein to reflect
events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events.
Notes to Editors
Electrical Geodesics, Inc. in Summary
Founded in 1992, EGI designs, develops and commercialises a
range of non-invasive neurodiagnostic and neuromodulation products
used to monitor, interpret and modulate brain activity, based on
its proprietary dense array electroencephalography ("dEEG")
platform technology. The Company's technology uses up to 256
sensors, providing much higher resolution brain activity data
compared to conventional 8 or 16 channel EEG and is used in
medical, clinical and research settings in a diverse range of
applications including important areas such as the diagnosis and
monitoring of epilepsy, neurosurgical planning, sleep assessment,
and many others.
EGI's dEEG systems, available in the GES 300 and now the GES 400
lines, capitalise on the Company's unique Hydrocel Geodesic Sensor
Net which allows faster, easier, and more convenient placement of
many EEG sensors in an even distribution over the entire scalp,
providing more accurate and precise diagnosis and measurement.
EGI's technology is now widely used in neuroscience research
laboratories and is becoming more commonly used in clinics, care
centers, and hospitals around the world. Data is measured and
visualised using EGI's proprietary amplifier technology and
software, providing a complete, advanced, high-resolution EEG
platform. The Company's products are compatible with multiple
diagnostic and imaging technologies, including magnetic resonance
(MR) imaging, functional MRI (fMRI), and magneto-encephalography
(MEG).
See our website www.egi.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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