SCOTTSDALE, AZ–(Marketwired – April 26, 2017) – Lattice Biologics Ltd. (TSX VENTURE: LBL) (OTCQB: LBLTF) (“Lattice Biologics” or the “Company“) is pleased to announce that it has entered into an agreement to successfully extinguish approximately US$2.8 million of debt under its royalty purchase agreement (the “Royalty Agreement“) with Grenville Royalty Corp. (“Grenville“), and concurrently restructure the notes between the Company and Grenville (the “Transaction“).
Pursuant to the Transaction, the Royalty Agreement will be terminated and approximately US$2.7 million of debt (the “Debt“) under the Royalty Agreement will be converted into equity of Lattice Biologics. In connection therewith, royalty payments in the amount of US$69,512 owing by the Company will be extinguished. The Debt is expected to be converted to equity at a conversion price of CAD$0.20 per common share. Upon completion of the Transaction, Grenville will hold 19.7% of the total issued and outstanding common shares of the Company.
The remaining US$1 million of debt under the Royalty Agreement will be converted to a new reduced royalty (the “New Royalty“) equal to 1.25% of the Company’s revenue payable quarterly as and when cash and cash equivalents for the quarter exceed the cash and cash equivalents for the previous quarter by at least US$100,000.
In connection with the Transaction, the Company will also restructure the secured note issued to Grenville on July 31, 2015 (the “Secured Note“) to extend the maturity date to April 24, 2022, and lower the interest rate under the Secured Note from 12.5% per annum to 4.244% per annum. In addition, overdue interest payments under the unsecured notes issued to Grenville in 2016 will be extinguished.
Completion of the Transaction is subject to the approval of the TSX Venture Exchange and compliance with all regulatory requirements. The common shares issuable in connection with the Transaction will be subject to a four-month resale restriction.
Guy Cook, the Company’s CEO stated: “This transformational transaction significantly reduces our monthly royalty and interest payment obligations, with a resulting improvement in our cash position and a cleaner, stronger balance sheet. We are very pleased to take this key step in positioning our Company for long-term success and would like to take this opportunity to thank Grenville for their substantial investment and strong support of Lattice. As key shareholders of the Company, Grenville now has significant leverage to equity returns as Lattice enters its next phase of growth and is fully aligned with all shareholders.”
“Lattice has made good progress on their development of new products,” said Grenville CEO Steve Parry. “Based on this progress, Grenville believes that transitioning our investment to a blend of equity, royalty and debt provides the best opportunity for positive financial returns for Grenville’s shareholders while improving Lattice’s balance sheet for future growth opportunities.”
Lattice Biologics Ltd.
Guy Cook
Chief Executive Officer
Telephone No: (480) 563-0800
About Lattice Biologics Ltd.:
Lattice Biologics Ltd. is an emerging precision medicine leader in the field of cellular therapies and tissue engineering, with an emphasis on bone, skin, and cartilage regeneration. As a manufacturer of the highest quality allografts, Lattice is focused on next generation products to improve surgical outcomes.
Versatile allografts for a variety of surgical applications:
- Enhancing fusion in spine surgery
- Enhancing breast reconstruction post mastectomy for breast cancer patients
- Sports medicine indications, including ACL repair
- Promotion of bone regeneration in foot and ankle surgery
- Promotion of cranial healing following neurosurgery
- Enhancing wound repair in burn victims
- Subchondral bone defect repair in knee and other joint surgeries
The Company is currently exploring new technologies in regenerative and personalized medicine:
- All natural amniotic fluid supplement for arthritic joints
- Demonstrates lasting pain relief and improved outcomes
- Personalized Cancer Diagnostics – revolutionary high-throughput precision chemotherapy screening
- See study details
Lattice Biologics operates headquarters, laboratory and manufacturing facilities in Scottsdale, Arizona as well as offices in Toronto Ontario. The Company maintains all necessary licensures to process and sell its tissue engineered products within the U.S. and internationally. This includes Certificates to Foreign Governments from the U.S. Food and Drug Administration (FDA) and registrations for 29 countries, which allow the export of bone, tendon, meniscus, ligament, soft tissue, and cartilage products outside of the U.S.
Lattice Biologics (TSX VENTURE: LBL) (OTCQB: LBLTF) became a publicly traded company on January 4, 2016.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Cautionary Statement on Forward-Looking Information:
Certain information contained in this news release constitutes “forward-looking statements” within the meaning of the ‘safe harbour’ provisions of Canadian securities laws. All statements herein, other than statements of historical fact, are to be considered forward looking. Generally, forward-looking information can be identified by the use of forward-looking terminology such as “potential”, “future”, “expected”, “could”, “possible”, “goal”, “intends”, “will” or similar expressions. Forward-looking statements in this news release include, without limitation: information pertaining to the Company’s strategy, plans, or future financial performance, such as statements with respect to the Transaction, future revenues or products, and other statements that express management’s expectations or estimates of future performance. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results to be materially different from those expressed or implied by such forward-looking statements. Such risks include but are not limited to: the risk that the Company may not be able to generate sufficient cash to service its indebtedness and uncertainty regarding the ability to consummate the Transaction.
Forward-looking statements are necessarily based upon a number of factors and assumptions that, while considered reasonable by management as of the date such statements are made, are inherently subject to significant business, economic and competitive uncertainties and contingencies. The factors and assumptions that could prove to be incorrect, include, but are not limited to: that market prices will be consistent with expectations, the continued availability of capital and financing, and that general economic, market and business conditions will be consistent with expectations. The forward-looking statements are not guarantees of future performance. We disclaim any obligation to update or revise any forward-looking statements, except as required by law. Readers are cautioned not to put undue reliance on these forward-looking statements.
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Lattice Biologics Ltd.
16701 N 90th Street, Suite#101
Scottsdale, AZ 85260
480-563-0800 Office
News@LatticeBiologics.com
www.LatticeBiologics.com