GeneNews Early Warrant Exercise Incentive Program

TORONTO, June 14, 2018 /CNW/ - GeneNews Limited ("GeneNews" or the "Corporation") (TSX: GEN) announces a warrant exercise incentive program (the "Program") designed to encourage the early exercise of its 2,059,052 outstanding and unlisted warrants (the "2018 Warrants") expiring August 15 and December 23, 2018.

"This is an opportunity for Warrant holders to exercise their Warrants early and receive an incentive to do so. It also brings the exercise prices more in line with current share pricing" said James R. Howard-Tripp, Chairman and CEO of GeneNews. "The early exercise of Warrants will provide additional capital to continue the expansion and growth currently underway with respect to test adoption. We will ask for shareholders to approve insider participation in the Warrant incentive program as part of our AGM process."

The Early Exercise Period is intended to encourage the early exercise of the 2,059,052 outstanding Warrants expiring in 2018 as detailed below.

		Warrants	Exercisable into common shares	Exercise price	Expiry date
		#	#	Cdn$
Date issued:
	September 1, 2016	1,997,612	1,997,612	0.50	August 15, 2018
	December 23, 2016	61,440	61,440	0.50	December 23, 2018
		2,059,052	2,059,052

Pursuant to the Program, the Corporation is offering an inducement of a reduction in exercise price from Cdn$0.50 to Cdn$0.15, which is approximately a 100% premium above the market price of the 5-day volume-weighted average price of the Common Shares on the TSX ("VWAP") as at the close of business on May 24, 2018, for the early exercise period commencing on June 29, 2018 at 9:00 a.m. (Eastern time) and terminating on July 27, 2018 at 4:30 p.m. (Eastern time) (the "Early Exercise Period"). The terms and conditions of this Early Exercise Period and the method of exercising 2018 Warrants are set forth in a letter which will be delivered to the registered address of each eligible Warrant holder prior to commencement of the Early Exercise Period. Warrant holders who wish to participate in the Early Exercise Period will agree to exercise their 2018 Warrants and deliver the other necessary documents to the Corporation.

Any 2018 Warrants that are not exercised prior to the Early Exercise Expiry Date will remain outstanding and continue to be exercisable for Common Shares of the Corporation on their current terms. The Warrants are not listed on the TSX. The Corporation is seeking shareholder approval for the amendment to 2018 Warrants held directly or indirectly by insiders of the Corporation, under the terms noted above.

The Program is subject to receipt of the approval of the Toronto Stock Exchange.

The Corporation will seek disinterested shareholder approval to amend the terms of the Warrants held directly or indirectly by insiders of the Corporation (as such term is defined by the TSX) at the upcoming annual and special meeting of shareholders of the Corporation scheduled for June 28, 2018 (the "Meeting"). A "Warrant Disinterested Shareholder" a Shareholder who does not, and whose associates and affiliates do not, have beneficial ownership of, or control or direction over, Warrants held directly or indirectly by insiders of the Corporation. As a result, the 21,560,541 Common Shares held by insiders of the Corporation, representing 15.05% of the currently issued and outstanding Common Shares, will be excluded from voting on the Eligible Insider Warrant Repricing. This transaction will not materially affect control of the Corporation.

There are 954,750 warrants being amended and held by insiders and 1,104,302 warrants being amended and held by arm's length parties, representing 0.7% and 0.8% of the Corporation's currently issued and outstanding common shares. Specifically, the insiders and their holdings comprise the following: Rory Riggs holds 625,000 eligible warrants (0.44% of the Corporation's currently issued and outstanding common shares), JTS Ventures Inc. D/B/A JTS Health Partners holds 250,000 eligible warrants (0.17% of the Corporation's currently issued and outstanding common shares) and Garth MacRae holds 79,750 eligible warrants (0.06% of the Corporation's currently issued and outstanding common shares).The proposed Warrant amendment will not be effective until 10 business days after the date hereof (in respect of holders of Warrants that are not insiders) and until receipt of shareholder approval (in respect of the holders of Warrants that are insiders).

The Corporation has determined that while the Warrant Repricing may be a related party transaction pursuant to Multilateral Instrument 61-101 – Special Transactions ("MI 61-101"), the Corporation is not required to obtain a formal valuation under subsection 5.4(1) of MI 61-101 for the Warrant Repricing because pursuant to the exemption set forth in 5.5(a) of MI 61-101, neither the fair market value of the Warrants nor the fair market value of the consideration paid for the Warrants exceeds 25% of the Corporation's market capitalization. In addition, the exemption from the minority approval requirement provided for under subsection 5.7(1)(a) of MI 61-101 can be relied on as neither the fair market value of the Warrants nor the fair market value of the consideration paid for such Warrants exceeds 25% of the Corporation's market capitalization.

About GeneNews

GeneNews, an innovator in the liquid biopsy space, 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 Diagnostic 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 four prevalent cancer types - colon, lung, prostate and breast. GeneNews' common shares trade on the Toronto Stock Exchange under the symbol 'GEN'.  More information on GeneNews and IDL can be found at www.GeneNews.com and www.myinnovativelab.com, respectively.

Forward-Looking Statements

This press release contains forward-looking statements identified by words such as "expects", "will", "may" and similar expressions, which reflect the Company's current expectations regarding future events, including with respect to the receipt of shareholder approval. The forward-looking statements involve risks and uncertainties that could cause actual events to differ materially from those projected herein including the state of the equity capital markets, the receipt of required approvals, the future financial and operating performance of the Company and its subsidiaries, requirements for and availability of additional capital and the general business and political environment including in the healthcare sector. 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

Company Contact: James R. Howard-Tripp, Chairman & CEO, [email protected]

Related Links

http://www.genenews.com/