Miami, FL – December 3, 2018 (EmergingGrowth.com NewsWire) — EmergingGrowth.com, a leading independent small cap media portal with an extensive history of providing unparalleled content for the Emerging Growth markets and companies, reports on Generex Biotechnology Corp. (OTCQB: GNBT).
Generex Biotechnology Corporation, through its subsidiary, Hema Diagnostic Systems, LLC, focuses on the development, manufacture, and distribution of in-vitro medical diagnostics for infectious diseases in Canada and the United States. The company offers Rapid Diagnostic Tests for human immunodeficiency virus½ w/p24Ab, tuberculosis-XT, malaria, hepatitis, syphilis, typhoid, dengue, and other infectious diseases.
Average daily volume for GNBT is 14 thousand shares. Today’s news created an increase in volume to 586 thousand shares in the morning hours of trading.
Generex Biotechnology Corp Press Release:
MIRAMAR, Fla.–(BUSINESS WIRE)–
- Secures remaining 49% of HDS for $1.00
- Debt restructuring erases $13,431,705.66 note
- Pays off $624,403.64 note with 32,881 shares of Generex common stock at $18.99 per share
- Delivers 15,000,000 warrants for $37.5 million at conversion with one year execution term
Generex Biotechnology Corporation (www.generex.com) (GNBT) (http://www.otcmarkets.com/stock/GNBT/quote) (“Generex”) is pleased to announce that the company has agreed to terms with Stephen L. Berkman (Mr. Berkman) to acquire the remaining 49% of Hema Diagnostic Systems (HDS). As previously reported, pursuant to a January 18, 2017 Acquisition Agreement among the Company, Hema Diagnostic Systems, LLC (“HDS”), Stephen L. Berkman and the other equity owners of HDS, Generex acquired 51% of the equity interests in HDS, with Mr. Berkman continuing to hold the other 49%. On December 1, 2018, the Company and Mr. Berkman entered into an Agreement, Assignment and Release, pursuant to which Mr. Berkman transferred the remaining HDS equity interests to the Company, waiving and releasing any conditions to such transfer. HDS is now a wholly owned subsidiary of the Company.
In addition to the assignment of the HDS interests, Mr. Berkman released Generex from an outstanding note in the amount of $624,403.64 in exchange for shares of the Company’s common stock valued at the aggregate of such amount using the closing price for the common stock on November 30, 2018. The closing price was $18.99, resulting in 32,881 shares issuable to Mr. Berkman. This transaction will result in $624,403.64 plus the Company’s 51% share of the HDS debt being removed from Company debt and added to the Company’s stockholders’ equity.
As part of the transaction, Mr. Berkman released HDS from notes totaling $13,431,705.66 made to HDS prior to the Generex acquisition on January 18, 2017.
On December 1, the Company also issued to Mr. Berkman, pursuant to the requirements of the January 2017 Acquisition Agreement, a Warrant exercisable for 15,000,000 shares of common stock; the Warrant is exercisable until December 1, 2019 at an exercise price of $2.50 per share. The Warrant contains a provision prohibiting the exercise of the Warrant to the extent that, after exercise, Mr. Berkman would own more than 9.99% of the Company’s Common Stock. The terms of this Warrant are detailed in a separate Current Report on Form 8-K.
“I am very gratified that a respected investor like Steve Berkman believes in Generex and management’s go forward plans so much that he has not only sold the remaining 49% of his company to Generex for one dollar, but he has forgiven over $13.5 million dollars in debt on the books of Generex that was originally a note from HDS,” said Joseph Moscato, Generex President & Chief Executive Officer. “Additionally, he has retired the Company’s debt of nearly $625,000 by converting his note to Generex stock at the Friday’s high closing price of $18.99. Most importantly, Mr. Berkman trusted Generex on delivery of the warrants that were pledged nearly two years ago when the Generex stock price was only 1/2 a penny. If fully exercised, the company will receive a payment of $37.5 million that will be used to advance our corporate mission. I am proud of his support and confidence in Generex.”
Further particulars in respect of the Agreement, Assignment and Release between Mr. Berkman and the Company are available in the Generex Form 8-K Current Report filed with the U.S. Securities and Exchange Commission on December 3, 2018 and publicly available at www.sec.gov and the disclosures in this press release are subject to those said particulars.
Cautionary Note Regarding Forward-Looking Statements
This release and oral statements made from time to time by Generex representatives in respect of the same subject matter may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by introductory words such as “expects,” “plan,” “believes,” “will,” “achieve,” “anticipate,” “would,” “should,” “subject to” or words of similar meaning, and by the fact that they do not relate strictly to historical or current facts. Forward-looking statements frequently are used in discussing potential product applications, potential collaborations, product development activities, clinical studies, regulatory submissions and approvals, and similar operating matters. Many factors may cause actual results to differ from forward-looking statements, including inaccurate assumptions and a broad variety of risks and uncertainties, some of which are known and others of which are not. Known risks and uncertainties include those identified from time to time in the reports filed by Generex with the Securities and Exchange Commission, which should be considered together with any forward-looking statement. No forward-looking statement is a guarantee of future results or events, and one should avoid placing undue reliance on such statements. Generex undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Generex claims the protection of the safe harbor for forward-looking statements that is contained in the Private Securities Litigation Reform Act.
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Generex Biotechnology Corporation
800-391-6755 Extension 222
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