Cancer Genetics Announces Closing of $10.0 Million Private Placement Priced At-the-Market

Rhea-AI Summary

Cancer Genetics, Inc. (Nasdaq: CGIX) has successfully closed a private placement, raising approximately $10.0 million through the issuance of 2,758,624 shares of common stock and associated warrants at $3.625 per share. The accompanying warrants, exercisable at $3.50 for five and a half years, are expected to support the company’s operations and its upcoming merger with StemoniX, pending stockholder approval. The proceeds will be utilized for general corporate purposes, including working capital.

Positive

• Raised approximately $10.0 million through a private placement.
• Warrants have an attractive exercise price of $3.50 per share.
• Funding expected to support future merger with StemoniX.

Negative

• Private placement may dilute existing shareholders due to the issuance of new shares.

RUTHERFORD, N.J., Feb. 01, 2021 (GLOBE NEWSWIRE) -- Cancer Genetics, Inc. (the “Company”) (Nasdaq: CGIX), a leader in drug discovery and preclinical oncology and immuno-oncology services, today announced the closing of its previously announced private placement of approximately $10.0 million through the issuance of an aggregate 2,758,624 shares of its common stock and warrants to purchase up to an aggregate 2,758,624 shares of common stock, at a combined purchase price of $3.625 per share of common stock and associated warrant in a private placement priced at-the-market under Nasdaq rules.

H.C. Wainwright & Co. acted as the exclusive placement agent for the offering.

The warrants have an exercise price of $3.50 per share, are exercisable immediately and have a term of five and one-half years.

The Company currently intends to use the net proceeds from the offering for general corporate purposes, including working capital and capital expenditures. The net proceeds are also expected to be available to the combined company once the previously announced merger with StemoniX closes, which is subject to stockholder approval.

The securities described above were offered in a private placement under Section 4(a)(2) of the Securities Act of 1933, as amended (the "Act") and Regulation D promulgated thereunder and in a transaction not involving a public offering and have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or applicable state securities laws. Accordingly, the securities may not be reoffered or resold in the United States except pursuant to an effective registration statement or an applicable exemption from the registration requirements of the Securities Act and such applicable state securities laws.

Under an agreement with the investors, the Company is required to file an initial registration statement with the Securities and Exchange Commission covering the resale of the shares of common stock to be issued to the investors by 9:30 a.m., Eastern Time, on February 2, 2021 and to use its best efforts to have the registration statement declared effective as promptly as practical thereafter, and in any event no later than 90 days after today in the event of a “full review” by the Securities and Exchange Commission.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of such state.

About Cancer Genetics, Inc.

Through its vivoPharm subsidiary, Cancer Genetics offers proprietary preclinical test systems supporting drug discovery programs valued by the pharmaceutical industry, biotechnology companies, and academic research centers. The Company is focused on precision and translational medicine to drive drug discovery toward novel and repurposed therapies. vivoPharm specializes in conducting studies tailored to guide drug development, starting from compound libraries and ending with a comprehensive set of in vitro and in vivo data and reports, which are needed for Investigational New Drug filings. vivoPharm operates in the Association for Assessment and Accreditation of Laboratory Animal Care International (AAALAC) accredited and GLP compliant audited facilities. For more information, please visit www.cancergenetics.com. 

Forward Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements pertaining to Cancer Genetics, Inc.’s expectations regarding future financial and/or operating results, the proposed offering of Cancer Genetics, Inc.’s shares of common stock, including as to the completion of the private placement described above, the satisfaction of customary closing conditions related to the private placement and the intended use of net proceeds from the private placement, potential for our tests and services and future revenues or growth in this press release constitute forward-looking statements.

Any statements that are not historical fact (including, but not limited to, statements that contain words such as “will,” “believes,” “plans,” “anticipates,” “expects,” “estimates”) should also be considered to be forward-looking statements. Forward-looking statements involve risks and uncertainties, including, without limitation, market and other conditions; our ability to satisfy all closing conditions to the merger with StemoniX, Inc., including financing conditions and Nasdaq listing requirements, our attempts to adapt to the global coronavirus pandemic, achieve profitability by increasing sales of our pre-clinical services, maintain our existing customer base and avoid cancellation of customer contracts or discontinuance of trials, raise capital to meet our liquidity needs, and market and other conditions, properly evaluate strategic options, and other risks discussed in the Cancer Genetics, Inc. Form 10-K for the year ended December 31, 2019 and Form 10-Q for the quarter ended September 30, 2020, along with other filings with the Securities and Exchange Commission. These forward-looking statements speak only as of the date hereof. Cancer Genetics, Inc. disclaims any obligation to update these forward-looking statements.

Investor Contacts:

Jennifer K. Zimmons. Ph.D.
Investor Relations
Zimmons International Communications, Inc
Email: jzimmons@zimmonsic.com
Phone: +1.917.214.3514

FAQ

What is the purpose of Cancer Genetics' recent private placement?

Cancer Genetics intends to use the proceeds for general corporate purposes, including working capital and capital expenditures.

How much money did Cancer Genetics raise in its private placement?

Cancer Genetics raised approximately $10.0 million through its private placement.

What is the exercise price for the warrants issued by Cancer Genetics?

The exercise price for the warrants is $3.50 per share.

When is the merger with StemoniX expected to close?

The merger with StemoniX is subject to stockholder approval and the exact closing date has not been specified.

What is the purchase price of the common stock in the private placement?

The common stock in the private placement was issued at a combined purchase price of $3.625 per share, including warrants.