Ventripoint Diagnostics Ltd.
TSX VENTURE : VPT

Ventripoint Diagnostics Ltd.

November 03, 2015 09:30 ET

Ventripoint Announces Strategic Investment and Details of Share Consolidation

SEATTLE, WASHINGTON--(Marketwired - Nov. 3, 2015) -

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Ventripoint Diagnostics Ltd. ("Ventripoint" or the "Corporation") (TSX VENTURE:VPT) announces that it intends to accept a strategic investment from Shanghai YuTian Medical Investment Management Co. Ltd. ("Ventrisound"), a Chinese Company, by way of a private placement offering of a total of 9,090,909 units ("Units") at $0.055 per Unit for total gross proceeds of up to $500,000 (the "Private Placement"). Each Unit will consist of one common share of Ventripoint ("Common Share") and one quarter of one Common Share warrant ("Warrant"). Each Warrant will entitle the holder thereof to acquire one additional Common Share at a price of $0.11 per Common Share for a period of 2 years after the issuance of the Warrant, subject to accelerations in certain events. The Corporation intends to close the Private Placement on November 6, 2015.

The Private Placement is to be made pursuant to the terms of an investment, distribution and manufacturing agreement entered into between Ventripoint and Lishman Global Inc. (the "Agreement"). Pursuant to the Agreement, Lishman Global Inc. facilitated the investment by Ventrisound into Ventripoint. Upon the closing of the Private Placement, Ventripoint will pay, to an affiliate of Lishman, a finder's fee comprised of i) cash in the amount of 8% of the gross proceeds of the Private placement, and ii) Warrants exercisable for the number of Common Shares equal to 8% of the number of Units purchased in the Private Placement. Each Warrant will entitle the holder thereof to acquire one additional Common Share at a price of $0.11 per Common Share for a period of 2 years after the issuance of the Warrant, subject to accelerations in certain events.

Pursuant to the terms of the Agreement and subject to certain milestones being achieved, Ventrisound will make a future investment ("Subsequent Investment") in Ventripoint in consideration of an exclusive license to develop, manufacture and distribute a series of Ventripoint's knowledge-based reconstruction ("KBR") products in the People's Republic of China. Ventrisound will establish a joint venture ("JV") with a large corporation in China to develop, manufacture and distribute the KBR products and capitalize the JV appropriately. The Subsequent Investment into Ventripoint of $2,250,000 will be made upon the completion of certain steps within the next 90 days, and will be on terms to be determined by the parties, within the context of market conditions at the time. After giving effect to the Subsequent Investment, Ventrisound would hold more than 10% of the issued and outstanding shares of the Corporation, and would be granted the right to nominate one director to the board of directors of the Corporation. Provided certain conditions are met, the Corporation will invest $750,000 in Ventrisound, and will have the right to appoint one director to the board of directors of Ventrisound.

"We are very pleased to set up Ventrisound as a technology and distribution platform to accelerate and secure the cooperation with Chinese companies in order to introduce the VMS family of heart analysis equipment to China," stated XiuLin Li, Managing Director of Lishman Global Inc. "The existing VMS products and next generation of cardiac diagnostics systems made in China will provide doctors with a safe and efficient tool to improve the healthcare service to the people in China."

"With 14,000 hospitals and 10,000 clinics in China and a growing cardiac healthcare need, this represents one of the largest markets for medical equipment in the world", stated Dr. George Adams, CEO of Ventripoint. "Ventrisound has already shown its commitment to the project by investing in Ventripoint and we look forward to the establishment of the joint venture to advance the development and use of VMS in China."

The Corporation will use the proceeds of the Private Placement for development, commercialization and general working capital purposes.

The Common Shares and the Warrants acquired by Ventrisound would be subject to a hold period of four months plus one day from the date of closing of the Offering except as permitted by applicable securities legislation and the rules of the TSX Venture Exchange (the "TSXV"). The Private Placement is subject to approval by the TSXV.

Consolidation

The Corporation also wishes to announce the details of the consolidation of the Common Shares of the Corporation, which was re-approved by the shareholders of the Corporation at the Annual General Meeting of the shareholders on October 13, 2015. The board of directors of the Corporation believes it is in the best interest of the Corporation to consolidate the Common Shares at a ratio of ten (10) pre-consolidation Common Shares for one (1) post-consolidation Common Shares (the "Consolidation"). The effective date of the Consolidation will be December 7, 2015. After the Consolidation the Corporation will have approximately 26 million common shares issued. The Consolidation remains subject to TSXV approval.

Forward Looking Statement:

This news release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking information or statements. In particular, this news release contains forward-looking information relating to the Private Placement and the use of the proceeds therefrom, and relating to the Agreement. The forward-looking statements and information are based on certain key expectations and assumptions made by the Corporation, including expectations and assumptions concerning the completion of the Private Placement, the use of net proceeds of the Private Placement, and the consummation of the transactions contemplated by the Agreement. Although the Corporation believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward looking statements and information because the Corporation can give no assurance that they will prove to be correct.

Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. Such factors may include the failure to satisfy certain conditions in connection with the issuance of the Units and failure to consummate the transactions contemplated by the Agreement. Other factors, which could materially affect such forward-looking information are described in the risk factors in the Corporation's most recent annual management's discussion and analysis that is available on the Corporation's profile on SEDAR at www.sedar.com. Readers are cautioned that the foregoing list of factors is not exhaustive. The forward-looking statements included in this news release are expressly qualified by this cautionary statement. The forward-looking statements and information contained in this news release are made as of the date hereof and the Corporation undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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