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GeneNews Secures CAD $5 Million Capital Commitment From GEM Global Yield Fund

TORONTO, June 09, 2016 (GLOBE NEWSWIRE) -- GeneNews Limited (“GeneNews” or the “Company”) (TSX:GEN) today announced that it has entered into a capital commitment agreement (the “Agreement”) with GEM Global Yield Fund LLC SCS (“GEM”) for a CAD $5 million Capital Commitment (“CC”). Proceeds raised from the investment will be used for working capital and general corporate purposes, particularly to support the activities being generated by the recently announced JTS partnership.

“We are very pleased to secure this non-debt agreement with GEM Global Yield Fund," commented GeneNews Executive Chairman, James R. Howard-Tripp. “Simply put, this agreement allows us to expand our options. It gives us the immediate capital resources required to prepare for anticipated growth in our test volumes as our partnership with JTS results in new users, and provides us with additional financial flexibility as we wait to be in a position to access the full range of financial instruments we have put in place."

CC Details

GeneNews has the right, but not the obligation, to draw down under the CC for a term of 3 years. Common shares will be issued to GEM at a price per share equal to the higher of the floor price set by GeneNews and a 10 per cent discount to the market price of the common shares based on the immediately preceding 5-day volume weighted average price at the end of an evaluation period. Each draw down is subject to remaining within a 25% dilution cap within the private placement, certain market out rights of GEM, and approval of the TSX. GEM will hold freely trading common shares of the Company through a share lending facility provided by certain current shareholders.

As part of the transaction, GeneNews will issue up to 6 million warrants to GEM, issued one for one against the first 6 million shares purchased by GEM under the CC. The warrants have an exercise price of CAD $0.50 per common share (so long as the market price for the common shares at the time of issuance of the warrants is less than CAD $0.50) and may be exercised for five years. On the first anniversary of the date of the Agreement, if the market price of GeneNews’ common shares is less than 90% of the then-current exercise price of the warrants, the exercise price of the warrants will adjust to 105% of the market price of the common shares at that time. If the Company does not issue the 6 million warrants within 24 months of the initial execution of the Agreement, the Company shall pay GEM 8% of the exercise value of any unissued warrants, subject to a maximum of CAD $240,000.

GeneNews will also be required to pay GEM Investment America, LLC a commitment fee equal to CAD $140,000 upon the sooner of the second draw, twelve months from execution of the Agreement, or a change of control of the Company. GeneNews may elect to pay the commitment fee in cash or stock (subject to TSX approval).

The Agreement has received the approval of the TSX. Each draw down, however, is subject to the approval of the TSX.

About GeneNews

GeneNews is focused on developing and commercializing proprietary molecular diagnostic tests for the early detection of diseases and personalized health management, with a primary focus on cancer-related indications. The Company's lead product, ColonSentry®, is the world's first blood test to assess an individual's current risk for colorectal cancer. GeneNews' common shares trade on the Toronto Stock Exchange under the symbol 'GEN'. More information on GeneNews can be found at www.GeneNews.com.

About IDL

Richmond, Virginia-based IDL is a national clinical reference lab specializing in personalized blood-based testing to help find, understand, and address cancer risk in patient populations. IDL’s mission is to provide a comprehensive menu of traditional and advanced clinical evidence-based blood tests that aid in early cancer detection. Currently IDL offers risk assessment blood tests for the three most prevalent cancer types including lung, colon and prostate. IDL is actively in-licensing and commercializing an array of DNA, RNA, protein and autoantibody blood-based cancer diagnostic tests to address early detection of all major types of cancer.

About GEM

Global Emerging Markets (www.gemny.com) was founded in 1991. GEM is a USD 3.4 billion investment group having completed 370 transactions in 70 countries. The firm is an alternative investment group that manages a diverse set of investment vehicles across the world. Each investment vehicle has a different degree of operational control, risk-adjusted return and liquidity profile. Our family of funds and investment vehicles provide GEM and its partners with exposure to: Small-Mid Cap Management Buyouts, Private Investments in Public Equities (PIPEs) and select venture investments. GEM's funds include: CITIC-GEM Fund (matured in December 2015), Kinderhook Industries (GP and LP non-voting stakes), GEM Global Yield Fund LLC SCS, GEM India and VC Bank/GEM Mena Fund (GEM exited both its GP and LP stakes in these funds in 2015 and 2010 respectively).

Forward-Looking Statements

In order to provide GeneNews’ investors with an understanding of our current intentions and future prospects, this release may contain statements that are forward-looking. Any statements contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Words such as “believes,” “anticipates,” “plans,” “expects,” “will,” “intends,” “potential,” “possible” and similar expressions are intended to identify forward-looking statements. These forward-looking statements include our expectations regarding the CC and the use of proceeds from such CC.

Forward-looking statements involve risks and uncertainties related to the CC, our business and the general economic environment, many beyond our control. These risks, uncertainties and other factors could cause our actual results to differ materially from those projected in forward-looking statements and include the risk with the CC that there is no certainty that the company will be able to raise funds on terms satisfactory to it, or at all, and the risk that sufficient shareholders of the Company will participate in the share lending arrangement. Although we believe that the forward-looking statements contained herein are reasonable, we can give no assurance that our expectations are correct. All forward-looking statements are expressly qualified in their entirety by this cautionary statement. Investors should consult the Company's ongoing quarterly filings and annual reports for additional information on risks and uncertainties relating to these forward-looking statements. The reader is cautioned not to rely on these forward-looking statements. The Company disclaims any obligation to update these forward-looking statements, except as required by law.

Company Contact: James R. Howard-Tripp Executive Chairman Office: (905) 209-2030 jhoward-tripp@genenews.com Investor & Media Contact: Stephen Kilmer Kilmer Lucas Inc. Office: (647) 872-4849 stephen@kilmerlucas.com

Source: GeneNews Limited