OTTAWA, Nov. 29, 2012 /CNW/ - Annidis Corporation (TSXV:RHA), creator of the Annidis RHA™ imaging technology that assists eye-care professionals screen, detect, diagnose and manage ocular diseases including Age Related Macular Degeneration (AMD) and Diabetic Retinopathy (DR), Glaucoma, today announced its third quarter operating and financial results for the period ended September 30, 2012.
- Continued to build back order position for RHA™ instrument installations scheduled during the remainder of the year.
- Focused on growing its installed base within North America and globally - the Company has entered into discussions with a number of large international distributors in Europe, China, India, Japan, and South America. Annidis is working to complete an agreement with a Chinese distributor in early Q1 2013.
- Continue to provide superior service to current customers ensuring high levels of customer satisfaction which is resulting in referrals and recommendations.
- Commencing a pilot project in December 2012 with a large North American optometry chain; a successful pilot project has the potential to lead to substantial sales.
- The Company has a total of 30 installed, 20 confirmed and committed orders and continues building on demonstrating the Annidis technology with over 100 contract proposals currently outstanding. Many new orders are the result of a strong working relationship with Cleinman Performance Partners in the U.S.
"This quarter, we focused on building up our back order position in order to prepare for the scheduled RHA™ instrument installations in Q4," said Gerald Slemko, Chief Executive Officer of Annidis. "As in many industries, we experienced seasonal scheduling conflicts with our customers, but these orders are contributing to our growing confirmed backlog. Additionally, we see great potential with our pilot project planned for December 2012 with a large North American optometry chain. This is in line with our large-scale strategy to target larger buying groups with larger orders. We believe this approach will yield a much better result in securing greater orders in the near future."
"Cleinman Performance Partners is pleased to continue its professional affiliation with Annidis. Our members were very impressed with the company's continuing education program and clearly perceive tremendous potential in Annidis technology to grow and develop their practice through progressive patient care," Alan Cleinman, President and CEO, Cleinman Performance Partners. Cleinman Performance Network is an invitation-only membership organization that combines wisdom-sharing group meetings, a series of unique services, and state-of-the-art information sharing formats, as well as cutting edge technology presentations with over 400 members.
Secured Promissory Note Financing
Annidis is also pleased to announce that, subject to the approval of the TSX Venture Exchange (the "TSXV"), it has commenced a secured promissory note financing (the "Financing") whereby Annidis will issue up to $3,000,000 in secured promissory notes (each individually referred to as a "Note" and together the "Notes"). The Notes have a three-year term, beginning on the issuance date, and bear interest at a rate of 10% per annum compounded monthly and payable at maturity.
Annidis may prepay the outstanding principal amount of the Notes together with all accrued and unpaid interest, without penalty, at any time after the first anniversary of the issuance date. In addition, upon receipt of the TSXV's approval, each lender shall be issued one common share purchase warrant ("Warrant") for every one dollar of principal having been loaned to Annidis. Each Warrant shall be exercisable at a price of $0.40 per common share, for a period of three years from the date of issuance, subject to the early expiry provisions as set out in the policies of the TSXV. In accordance with applicable securities laws, the securities issued in connection with the Financing are subject to a minimum four month hold period. The Notes will be secured by a general security agreement over the assets, including all intellectual property, of Annidis' wholly owned operating subsidiary Annidis Health Systems Corp. The proceeds from the Financing will be used by Annidis for general working capital purposes.
On Thursday November 29, 2012, Annidis, subject to the approval of the TSXV, closed the first tranche of the Financing issuing three Notes with a total aggregate principal amount of $1,029,975. The first Note, in the amount of $416,249 was issued to Slemko Investment Corporation, a corporation beneficially owned and controlled by Gerald Slemko, director and Chief Executive Officer of Annidis; the second Note, in the amount of $100,438 was issued to Michael Mueller, a director of Annidis; and, the third Note, in the amount of $513,288 was issued to a shareholder of Annidis who is neither an officer or director of the corporation. In addition, a total of 1,029,975 Warrants will be issued to the lenders in connection with the issuance of the Notes. Each Warrant is exercisable at a price of $0.40 per common share, for a period of three years from the date of issuance, subject to the early expiry provisions as set out in the policies of the TSXV.
Retention of Market Maker
Annidis has, subject to regulatory approval, retained Venture Liquidity Providers Inc. ("VLP") to initiate its market-making service to provide assistance in maintaining an orderly trading market for the common shares of Annidis.
The market-making service will be undertaken by VLP through a registered broker, W.D. Latimer Co. Ltd., in compliance with the applicable policies of the TSXV and other applicable laws. For its services, the corporation has agreed to pay VLP $5,000 per month for a period of 12 months. The agreement may be terminated at any time by the corporation or VLP. The corporation and VLP act at arm's length, and VLP has no present interest, directly or indirectly, in the corporation or its securities. The finances and the shares required for the market-making service are provided by W.D. Latimer. The fee paid by the company to VLP is for services only.
VLP is a specialized consulting firm based in Toronto providing a variety of services focused on TSX-V-listed issuers.
The Company recorded contract revenues earned from the deployment of medical devices for the three and nine months ended September 30, 2012, of $192,401 and $662,119, compared to $61,361 and $144,837, respectively, for the same periods in 2011. The increase in revenue over the prior year was attributed to an increase in number of devices sold and increased units deployed under the rental program during the period.
Total general and administrative expenses for the three and nine months ended September 30, 2012, were $285,356 and $913,144, compared to $491,585 and $849,539, respectively for the corresponding periods in 2011. A significant portion of this increase is attributable to higher costs incurred in 2012 as a result of the Company being a public entity. In addition, occupancy costs have increased for the quarter over the prior year by $63,605 due to the additional spacing requirements and increased costs incurred in fiscal 2012 for clinical development activities.
Research and development (R&D) expenses for the three and nine months ended September 30, 2012, were $214,649 and $546,789, compared with $360,341 and $741,874, respectively, for the corresponding periods in 2011. The reduction in expenses is largely attributed to lower staff costs due to reduced R&D activity and decreased professional fees for patent filings incurred during fiscal 2012.
Net loss was $900,988 or $0.02 per share and $3,124,608 or $0.05 per share for the three and nine months ended September 30, 2012, respectively, compared with the loss of $1,275,828 or $0.02 per share and $5,005,435 or $0.10 per share for the corresponding periods in 2011. The decrease in net loss is largely attributed to the financing transaction costs and listing expenses incurred in 2011 associated with the Qualifying Transaction, offset by an increase in share-based compensation in 2012 from a stock option modification.
During the three and nine months ended September 30, 2012, the Company used net cash of $423,369 for operating activities as compared to $567,639 for the corresponding periods of 2011.
As at September 30, 2012, the Company had cash on hand of $199,785 compared to $73,214 as at December 31, 2011. The increase was the result of an equity raise of $2,020,000, which was completed on March 16, 2012.
Total current liabilities and long term liabilities were $3,372,306 at September 30, 2012, compared to $4,786,449, at December 31, 2011.
As at September 30, 2012, the Company's working capital deficiency was $1,192,012 compared to a working capital deficiency of $2,591,834 as at December 31, 2011. This increase in equity is largely attributed to closing of the private placement for gross proceeds of $2,020,000 and the reclassification of the converted portion of the convertible debentures from liabilities to share capital and the issuance of equity relating to the debenture holders who subscribed to common shares and warrants in exchange for the debentures that matured on March 31, 2012.
About Annidis Corporation
Annidis (TSX-V:RHA) is dedicated to researching and developing instrumentation to assist in the early detection and monitoring of diseases of the eye. The Company's RHATM is an ocular pathology management system that integrates advanced multi-spectral imaging and analytic software for early detection and management of ocular pathologies such as Age Related Macular Degeneration (AMD) and Diabetic Retinopathy (DR), Glaucoma. The RHA system is the result of a multiyear research and development effort by the Annidis team in collaboration with leading eye care professionals and researchers in Canada including the Ottawa Eye Institute, Toronto Western Hospital.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy of this press release.
This news release may contain "forward-looking information" within the meaning of applicable Canadian securities legislation. Statements made in this news release, other than those concerning historical financial information, may be forward-looking and therefore subject to various risks and uncertainties. The words "may", "will", "could", "should", "would", "suspect", "outlook", "believe", "plan", "anticipate", "estimate", "expect", "intend", "forecast", "objective", "hope", and "continue" (or the negative thereof), and words and expressions of similar import are intended to identify forward-looking statements. Certain material factors or assumptions are implied in making forward-looking statements and actual results may differ materially from those expressed or implied in such statements. Factors that could cause results to vary include those identified in the Annidis' filings with Canadian securities regulatory authorities, such as the applicability of patents and proprietary technology; possible patent ligation; regulatory approval of products in development; changes in government regulation or regulatory approval processes; government and third party reimbursement; dependence on strategic partnerships; intensifying competition; rapid technological change in the industry; anticipated future losses; the ability to access capital; and the ability to attract and retain key personnel. All forward-looking information presented herein should be considered in conjunction with such filings. Except as required by Canadian securities laws, the Corporation does not undertake to update any forward-looking statements; such statements speak only as of the date made.
SOURCE: Annidis Corporation
For further information:
about Annidis please contact:
Gerald Slemko, CEO
(416) 815-0700 ext. 264