BROSSARD, QUEBEC — (Marketwired) — 06/30/15 — DIAGNOS Inc. (“DIAGNOS” or “the Corporation”) (TSX VENTURE: ADK), a leader in healthcare technical services including screening, software and algorithm development, data analysis, and image processing, announces both the appointment of Lloyd M. Segal as Executive Chairman of the board of directors of the Corporation and that it has entered into an engagement agreement for a private placement (“Private Placement”) consisting of Senior Secured Convertible Debentures (each a “Debenture”), having a 4-year term and bearing interest at an annual rate of 10% for gross proceeds of up to $4,000,000, on a best efforts basis. Philip Renaud, Diagnos– current Chairman, will continue to serve as a director of the Corporation and investment funds associated with Mr. Renaud have placed a lead order in the Private Placement.
Mr. Segal has been a director of the Corporation since August, 2014 and has experience in the role chief executive officer (“CEO”) in financing, developing and leading healthcare companies. He served as CEO of Thallion Pharmaceuticals, a biotechnology company sold to Bellus Health in 2013; as founding CEO of Caprion Pharmaceuticals (now Caprion Proteomics, sold to Great Point Partners in 2007); and founder and CEO of Advanced Bioconcept, an innovator in the development and sale of novel discovery tools for life science research, which was sold to NEN Life Sciences Products (now PerkinElmer, Inc.) in 1998. Mr. Segal holds a Bachelor of Arts (BA) in politics from Brandeis University and a Master in Business Administration (MBA) from Harvard Business School. Mr. Segal has served on several public boards including Thallion, SciQuest and Valeant Pharmaceuticals International from 2007 to 2014, and was recognized in 2013 for his outstanding public directorship by the Financial Times Outstanding Directors Exchange (ODX).
Mr. Segal has declined cash compensation in respect of his new role and will be granted 3,700,000 stock options which vest over three years and are exercisable at a price of $0.095 up to five years from the date of grant subject to vesting and other provisions approved by the Board and/or described in the Stock Option Plan of the Corporation.
The principal focus of Mr. Segal–s efforts will be to (i) define a US go-to-market strategy; (ii) identify US-market experienced leadership, (iii) work with Andre Larente and the management team, and (iv) support and assist in the execution of the Corporation–s business strategy in the near term.
The proceeds of the Private Placement will be used to fund business development and product development of healthcare services, as well as for general corporate and working capital purposes.
Interest on the Debentures is payable in cash as follows;
At the sole option of the holders of the Debentures, the principal amount of the Debentures may be converted at any time, in whole or in part, into common shares of the Corporation at a price of $0.10 per common share. Any accrued interest on the principal, at time of conversion, is immediately payable in cash.
The Corporation has retained the services of Bloom Burton & Co. Limited (“Bloom Burton”) to act as its exclusive agent in connection with the Private Placement. As per the engagement agreement, Bloom Burton is entitled to receive a commission in cash of 7% on proceeds from subscribers referred by Bloom Burton and 2% on proceeds from subscribers referred by the Corporation. Bloom Burton is also entitled to a number of brokers warrants (each a “Warrant”) equal to the amount of commissions paid or payable divided by $0.15. The exercise price of these Warrants has been established at $0.15. The Warrants will be exercisable over a period of two years from issuance. The Warrants are non-transferable.
The Debentures will be sold in Canada on a prospectus-exempt basis and the Warrants and common shares underlying the Debentures and Warrants will be subject to a statutory four-month hold period.
This proposed Private Placement is subject to receipt of all required regulatory approvals, including the approval of the TSX Venture Exchange, as well as the negotiation and execution of formal documentation. Closing of the Private Placement is expected to take place on or around July 20, 2015.
All monies quoted in this press release shall be stated and paid in lawful money of Canada.
About DIAGNOS
DIAGNOS is a publicly-traded Canadian corporation with a mission to improve the quality of patients– lives and minimize the economic burden of vision loss. Computer Assisted Retinal Analysis (CARA) is the Company–s proprietary tele-ophthalmology platform that integrates with existing equipment (hardware and software) and processes at the point of care (POC) and comprises: image upload, image enhancement automated pre-screening, grading by a specialist, and referral to a specialist. CARA–s image enhancement algorithms make standard retinal images sharper, clearer, and easier to read. CARA is accessible securely over the internet, and is compatible with all recognized image formats and brands of fundus cameras, and is EMR compatible. CARA is a cost-effective tool for screening large numbers of patients, in real-time and has been approved by regulatory authorities including Health Canada, the U.S. Food and Drug Administration, and the European Union.
Forward-looking information
This document contains forward-looking information that involves risks and uncertainties, including without limitation, statements pertaining to the Private Placement and its use of proceeds. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in these statements. Unless required under law, DIAGNOS will not update this forward-looking information to reflect new events or circumstances
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contacts:
Andre Larente
President, DIAGNOS
1-877-678-8882 or (450) 678-8882, ext.: 224
Jolyon Burton
CEO & Head of Investment Banking, Bloom Burton & Co Limited
416-640-7585
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