Mr. James Howard-Tripp reports
GENENEWS EXPANDS COVERAGE BY COMMERCIAL HEALTH INSURANCE NETWORKS
GeneNews Ltd. has entered into an agreement with Three Rivers Provider Network for Innovative Diagnostic Laboratory LLP's tests for early cancer detection. Three Rivers Provider Network is a rapidly growing proprietary provider network with 200 million lives that have access to Innovative Diagnostic Laboratory services through the TRPN network of providers, hospitals and ancillary facilities. The ability to address diagnostic gaps in early cancer detection saves lives and money for providers and patients in this network through access to proprietary Innovative Diagnostic Laboratory tests.
GeneNews/Innovative Diagnostic Laboratory has also entered into an agreement with MultiPlan Inc., one of the most comprehensive providers of health care cost management solutions that includes primary, complementary and out-of-network strategies for managing the financial risks associated with health care claims. MultiPlan contracts with 900,000 health care providers across the United States and has an estimated 60 million consumers accessing MultiPlan network products.
"We are pleased to announce that we are successfully establishing agreements with regional and national commercial health insurance networks, like Three Rivers and MultiPlan, resulting in expanded access to our four early cancer diagnostic tests -- ColonSentry, EarlyCDT-lung, Prostate Health Index (PHI) and BreastSentry," commented James Howard-Tripp, chairman and chief executive officer of GeneNews. "This expanded access is benefitting all parties -- patients, their providers and ourselves -- as more efficient processing of claims becomes fully established."
GeneNews/Innovative Diagnostic Laboratory is in discussion with several other regional and national commercial health insurance networks as well as self-financed employer plans.
Additionally, GeneNews is preparing for a very active first quarter in 2019, with plans already in place for screening of high-risk employee groups, implementation of screening within large health care groups and collaborating with one or more large physician networks. In addition, GeneNews will begin initial rollout of the rebranding of the company, which, together with an expanded direct-to-consumer focus, will allow the company to more fully provide its early cancer diagnostic tests to the many patients who contact it.
Second convertible security
GeneNews has also entered into a second convertible security financing agreement with Lind Asset Management XI LLC for $500,000 in convertible securities.
Under the terms of the agreement, Lind Asset Management will advance $500,000, less a closing fee of $35,000, in consideration for the issuance by the company of a convertible security with a face value of $600,000, which is expected to occur within 10 business days, subject to satisfaction of certain closing conditions.
"This injection of cash is welcome and will allow the company to accelerate its initiatives with large health care providers to increase the rate of implementation, as well as begin rebranding. We are very pleased to have the partners within Lind continue to support us in this way," commented Mr. Howard-Tripp.
The convertible security has a 30-month term from the date of issuance and bears interest of 8 per cent per year.
The company's obligations under the agreement are secured by all of the company's present and after-acquired property, other than intellectual property, including a pledge of its equity interests in its subsidiaries. In addition, the company's indirect subsidiary, Innovative Diagnostic Laboratory, has pledged its present and after-acquired property, other than intellectual property.
Lind Asset Management may convert the convertible security in monthly instalments over the term at a conversion price equal to 85 per cent of the five-day trailing volume-weighted average price of the company's common shares on the Toronto Stock Exchange prior to the date that notice of conversion is provided by Lind Asset Management. The agreement contains restrictions on the amount of the convertible security that may be converted in any particular month and how many common shares of GeneNews Lind Asset Management may hold at any given time. Lind Asset Management is entitled to accelerate its conversion right to the full amount of the face value or demand repayment of the face value of the convertible security in cash upon a default and other specified events. To the extent that the full face value of the convertible security has not been converted at maturity, the balance of the face value is to be paid in cash at the end of the 30-month term.
The company has the option to buy back the convertible security in cash at any time by paying a buyback premium equal to 5 per cent of the outstanding balance of the convertible security.
In addition, the company has agreed to issue 18,889,308 warrants to Lind Asset Management in respect of the convertible security, which are exercisable for 36 months at an exercise price of 3.44 cents per share. The number of warrants issued in connection with the convertible security are equal to 100 per cent of the amount advanced by Lind Asset Management ($500,000) divided by the volume-weighted average price of the common shares of the company on the TSX for the five trading days immediately preceding the execution date of the agreement. The warrants provide for cashless exercise by the holder in the event that the company ceases to be a foreign private issuer, as that term is defined under the United States Securities Act of 1933.
The agreement and the issuance of the convertible security thereunder have been conditionally approved by the TSX and are subject to satisfaction of customary closing conditions.
About GeneNews Ltd.
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. The company's 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 outcomes through the early diagnosis of disease.
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