GeneNews Announces Rights Offering
TORONTO, CANADA (April 18, 2012):
GeneNews Limited (TSX:GEN) ("GeneNews" or the "Company") today announced that it will be offering rights (the "Rights Offering") to holders of its common shares (the "Common Shares") of record at the close of business on May 1, 2012 (the "Record Date"), expiring June 5, 2012 ("Expiry Date"). The Rights Offering will be made in all of the provinces and territories of Canada and in such other jurisdictions where the Company is eligible to make such Rights Offering.
Shareholders of record on May 1, 2012 will receive one right (a "Right") for each Common Share held. Four (4) Rights will entitle the holder to purchase one Common Share at a price of $0.11 per Common Share. Exercise of the Rights and purchase of the Common Shares must be completed by 5:00 p.m. (Toronto time) on the Expiry Date. Shareholders who fully exercise their Rights are entitled to subscribe pro rata for additional Common Shares, if available, that were not subscribed for initially on or before the Expiry Date. A fully subscribed Rights Offering will raise gross proceeds of approximately $2,554,700, which will be used to support commercialization of the Company's lead product, ColonSentry®, and for general corporate and administrative expenses.
GeneNews has entered into a stand-by guarantee agreement dated April 16, 2012 (the "Stand-By Guarantee") with Rory Riggs, the Chair of the Company's Board of Directors, and AWM Investment Company, Inc., an investment company which beneficially owns and controls Common Shares through a number of its funds (collectively, the "Guarantors"). Pursuant to the Stand-By Guarantee, the Guarantors have agreed to exercise Rights and purchase Common Shares offered under the Rights Offering that are not otherwise purchased thereunder, so that the gross proceeds raised through the Offering are at least $1,000,000. The terms of any subscription under the Stand-By Guarantee will be identical in all respects to those of shareholders as a whole under the Rights Offering.
The Rights will be posted for trading on the TSX and will trade under the symbol "GEN.RT". Trading of the Rights is expected to continue until 12:00 noon (Toronto time) on the Expiry Date. A Rights Offering circular, together with Rights certificates, will be mailed to eligible shareholders on or about the Record Date. Registered shareholders wishing to exercise their Rights must forward the completed Rights certificates, along with the applicable funds to Equity Financial Trust Company by the Expiry Date. Shareholders who own their shares through an intermediary, such as a bank, trust company, securities dealer or broker, will receive materials and instructions from their intermediary.
No U.S. Registration
The securities offered will not be or have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or the securities laws of any state of the United States, and may not be offered or sold in the United States or to, or for the account or benefit of, any U.S. person (as defined in Regulation S of the Securities Act) or person in the United States, unless an exemption from such registration requirements is available. Certain shareholders in the United States will be permitted to participate in the Rights Offering upon satisfying the Company that such participation is lawful and in compliance with all applicable securities and other laws of the United States. This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities in the United States.
GeneNews is an emerging molecular diagnostics company focused on the application of functional genomics to enable early diagnosis and personalized health management based on disease-specific biomarkers. The Company has a patented core platform technology, the Sentinel Principle®, which has the power to detect and stage a range of diseases or medical conditions from a simple blood sample. GeneNews is currently applying the Sentinel Principle® in major areas with unmet clinical needs such as cancer, arthritis, cardiovascular disease and neurological disorders. GeneNews' lead product, ColonSentry®, is the world's first blood test to pre-screen and assess an individual's current risk for colorectal cancer. For more information on GeneNews and ColonSentry®, go to www.GeneNews.com or www.ColonSentry.com.
This press release contains forward-looking statements, which reflect the Company's current expectations regarding future events. The forward-looking statements involve risks and uncertainties. Actual events could 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.