Xillix Technologies Corp.

Xillix Technologies Corp.

August 21, 2006 17:26 ET

Xillix Announces Amendment to Loan Agreements

RICHMOND, BRITISH COLUMBIA--(CCNMatthews - Aug. 21, 2006) - Xillix Technologies Corp. (TSX:XLX), the world leader in fluorescence endoscopy for the early detection of cancer, today announced an amendment (the "Amendment") to its loan agreement (the "Loan Agreement") dated December 20, 2005 with Hercules Technology Growth Capital, Inc. (the "Lender").

Under the Amendment, the Company has agreed to immediately pay the sum of US $1,000,000 to the Lender, as a partial prepayment of principal owing under the Loan Agreement, together with a restructuring fee of US $40,000 and the Lender's related expenses. The Company has also agreed that, beginning on August 31, 2006, it will increase the blended monthly payments of payment and interest under the Loan Agreement to approximately US $260,000, and, in the event of a Merger, will pay the Lender a success fee of US $300,000. The Amendment also provides that the Company will be in default under the Loan Agreement if either Mr. Brett Gannon (President and CEO) or Mr. John Fengler (Vice President of Engineering and Development) ceases to be employed by or actively involved in the management of the Company. As part of this restructuring, the Company has also agreed to re-price the warrants for the purchase of up to 2,621,688 common shares of the Company held by the Lender, from $0.25 (Canadian) per share to an amount equal to the volume weighted average price of such shares on the TSX, being the sum of $0.07 per share. In exchange, the Lender has waived certain claims which it may otherwise have with the respect to the occurrence of defaults under the Loan Agreement.

About Xillix

Xillix Technologies Corp. is a Canadian medical device company and the world leader in fluorescence endoscopy for improved cancer detection. Xillix's currently approved device, Onco-LIFE™, incorporates fluorescence and white-light endoscopy in a single device that has been developed for the detection and localization of lung and gastrointestinal (GI) cancers. An international multicenter lung cancer clinical trial of Onco-LIFE demonstrated a 325% per-lesion improvement in the detection of early lung cancer (moderate-severe dysplasia and carcinoma in situ) and a 250% per-patient improvement compared to white-light alone. Onco-LIFE is approved for sale in the United States for the lung application and in Europe, Canada and Australia for both lung and GI applications. The Company also recently announced that it has developed a new product, LIFE Luminus™, designed to allow fluorescence imaging of the colon using conventional video endoscope technology.

"Statements contained in this document which are not based on historical fact, including without limitation, statements containing the words "may", "will", "plans", "intends", "expects", "anticipates", "believes", "estimate", "continue" and similar expressions, constitute "forward- looking information" within the meaning of applicable Canadian securities laws. Forward-looking statements contained in this document may involve, but are not limited to, statements relating to the Company's objectives, priorities, strategies, actions, targets, expectations and outlook. Forward-looking statements are necessarily based upon assumptions and predictions with respect to the future, including but not limited to the factors referred to below. As a result, forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, events or developments to be materially different from any future results, events or developments expressed or implied thereby. These risks, uncertainties and other factors include, but are not limited to the factors referred to in the Company's Annual Information Form dated March 28, 2006 and its other filings with the applicable Canadian securities regulatory authorities. In light of these uncertainties, assumptions and risks, readers are cautioned not to place undue reliance on such forward-looking statements, and the Company assumes no obligation to update or revise such information to reflect later events or developments, except as required by law."

The Company is listed on the Toronto Stock Exchange under the trading symbol "XLX".

Contact Information

  • Xillix Technologies Corp.
    Sonja Rematore
    Investor Relations
    (604) 278-5000
    Xillix Technologies Corp.
    Brett Gannon
    President and Chief Executive Officer
    (604) 278-5000
    (604) 278-5111 (FAX)