TORONTO, March 7, 2013 /CNW/ - Spectral Diagnostics Inc. (TSX: SDI) (OTC QX: DIAGF) ("Spectral", or the "Company") today announced that it has entered into a private placement agreement with Toray Industries, Inc. ("Toray"), pursuant to which Toray will invest $5 million in Spectral.
Under the terms of the private placement (the "Private Placement"), the Company will issue 16,666,667 common shares in the capital of the Company ("Common Shares") to Toray at a price of $0.30 per Common Share, for gross proceeds of $5 million.
The net proceeds of the Private Placement will be used to continue to support the Company's EUPHRATES clinical trial and for general corporate purposes. Following the closing of the Private Placement, Toray's investment will represent approximately 12.8% of the issued and outstanding Common Shares, calculated on a non-diluted basis. Under the terms of the Private Placement, Toray will be entitled to nominate one director to the Spectral board for as long as it holds 10% or more of the issued and outstanding Common Shares (calculated on a non-diluted basis).
"This strategic investment not only provides additional funds for our clinical trial, but also strengthens the existing collaborative relationship we have with Toray," said Anthony Businskas, Executive Vice President and CFO of Spectral. "We will work with Toray to complete clinical research for U.S. FDA market approval of Toraymyxin, and we will seek to further expand acceptance of the EAATM/ Toraymyxin theranostic in jurisdictions outside of Japan."
Closing of the Private Placement is subject to the approval of the Toronto Stock Exchange and other customary closing conditions. The Private Placement is currently expected to close at the beginning of April, 2013.
About Spectral Diagnostics
Spectral is a Phase III company seeking U.S. FDA approval for its lead theranostics product (Toraymyxin) for the treatment of septic shock. Toraymyxin is a therapeutic hemoperfusion device that removes endotoxin, which can cause sepsis, from the bloodstream. Directed by the Company's Endotoxin Activity Assay (EAA™), the only FDA-cleared diagnostic for the risk of developing sepsis, Spectral's EUPHRATES trial is the world's first theranostics trial in the area of sepsis.
Spectral is listed on the Toronto Stock Exchange under the symbol SDI, and on the OTC QX under the symbol DIAGF. For more information please visit www.spectraldx.com
About Toray Industries, Inc.
Toray Industries, Inc. is a Japanese-based manufacturer of fibers, textiles, plastics, chemicals, IT related products, carbon fiber composite materials, environmental and engineering equipment, and pharmaceutical and medical products. In FY 2011, Toray was active in 23 countries and regions, and had net sales of ¥1.6 trillion (approximately U.S.$19 billion). Toray manufactures the Toraymyxin hemoperfusion device and has licensed to Spectral the exclusive rights to this product in the United States and granted the Company exclusive distribution rights in Canada.
Note: U.S. dollar amounts have been converted from yen at the exchange rate of ¥82.2 = U.S.$1, the approximate rate of exchange prevailing on March 31, 2012.
Information in this news release that is not current or historical factual information may constitute forward looking information within the meaning of securities laws. Implicit in this information, particularly in respect of the future outlook of Spectral and anticipated events or results, are assumptions based on beliefs of Spectral's senior management as well as information currently available to it. While these assumptions were considered reasonable by Spectral at the time of preparation, they may prove to be incorrect.
Readers are cautioned that actual results are subject to a number of risks and uncertainties, including the availability of funds and resources to pursue R&D projects, the successful and timely completion of clinical studies, the ability of Spectral to take advantage of business opportunities in the biomedical industry, the granting of necessary approvals by regulatory authorities as well as general economic, market and business conditions, and could differ materially from what is currently expected.
The TSX has not reviewed and does not accept responsibility for the adequacy or accuracy of this statement.
SOURCE: Spectral Diagnostics Inc.
For further information:
Spectral Diagnostics Inc.
Executive Vice President and CFO
416-626-3233 ext. 2200
416-815-0700 ext. 225