Momentum Public Relations
Press Release: October 24, 2018
DIAGNOS Inc. (“DIAGNOS” or the “Corporation”) (TSX Venture: ADK) (OTCQB: DGNOF), a leader in early detection of critical health issues through the use of Artificial Intelligence, announces a private placement (“Private Placement”) of up to 8,000,000 units (each a “Unit”) issued at $0.05 per Unit for gross proceeds of up to $400,000. The Corporation also announces its intention to issue 4,375,000 common shares in payment for a debt of $218,750 related to interests payable on outstanding convertible debentures and convertible notes.
Private Placement
Each Unit consists of;
(i) | one common share (“Share”), and |
(ii) | one stock warrant (“Warrant”) entitling the holder to purchase one Share per Warrant at a price of $0.07 per Share, for a period of 18 months from the date of issuance of the Warrant. |
The proceeds will be used mainly to fund sales and marketing as well as administrative expenses.
One participant in the Private Placement is a director of DIAGNOS and, therefore, considered a “related party” of the Corporation within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The director is expected to subscribe for up to 2,000,000 Units and, together with one related person, would exercise, as a result of the Private Placement, control over 5.15% of the common shares of DIAGNOS. The transaction is exempt from the valuation requirement and the minority approval requirement prescribed in MI 61-101 based on the fact that the fair market value of the related party’s participation in the Private Placement does not exceed 25% of DIAGNOS’ market capitalization prior to the closing of the Private Placement.
Shares issued as part of the Private Placement as well as the underlying Shares to be issued upon exercise of the Warrants are subject to a statutory four-month hold period from the date of issuance.
Closing of the Private Placement is scheduled for October 30, 2018. The Private Placement is subject to receipt of all required regulatory approvals, including the approval of the TSX Venture Exchange, as well as the execution of formal documentation.
Shares for debt
The Corporation intends to issue 4,375,000 common shares at a deemed price of $0.05 in payment for a debt of $218,750 related to interests payable on outstanding convertible debentures and convertible notes.
Satisfying this outstanding indebtedness with shares was undertaken in order to preserve the Corporation’s cash for operational purposes.
One participant eligible to receive common shares as part of the shares for debt arrangement is a director of DIAGNOS and, therefore, considered a “related party” of the Corporation within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The director, together with one related person, is expected to receive 230,000 common shares. The transaction is exempt from the valuation requirement and the minority approval requirement prescribed in MI 61-101 based on the fact that the fair market value of the related party’s participation in the shares for debt arrangement does not exceed 25% of DIAGNOS’ market capitalization. Shares issued to the director and one certain related person, as part of the shares for debt arrangement, are subject to a statutory four-month hold period from the date of issuance.
The issuance of shares as part of the shares for debt transaction is subject to receipt of approvals from all of the parties, as well as from the applicable regulatory authorities, including the approval of the TSX Venture Exchange, and the execution of formal documentation.
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 of early detection of critical health issues through the use of its Artificial Intelligence (“AI”) tool CARA (Computer Assisted Retina Analysis). CARA is a tele-ophthalmology platform that integrates with existing equipment (hardware and software) and processes at the point of care. CARA’s Artificial Intelligence 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 cleared for commercialization by several regulatory authorities such as Health Canada, the U.S. Food and Drug Administration and the European Union.
Additional information is available at www.diagnos.com and www.sedar.com.