News & Media
|Hemostemix Announces Reorganization|
|Jan 25 2017 -
Hemostemix Inc. ("Hemostemix" or the "Company") (TSX VENTURE: HEM) announces additional progress and details of the corporate reorganization of the Company originally announced on December 22, 2016 including the appointment of new directors and the sale of the Issuer's convertible debenture.
As announced by the Company on January 5 and 6, 2017, Messers. Robert Bard, Victor Redekop and Robert L. Buckler have all resigned as directors of the Company, creating three vacancies on the Company's board of directors (the "Board"). The remaining director of the Company, Angus Jenkins, has appointed Messers. David L. Wood and Donald E. Friesen to fill two of the three vacancies on the Board. These two appointments have been ratified and confirmed by Drive Capital Corp. ("Drive Capital") in accordance with its role pursuant to the management contractor agreement announced on December 22, 2016 (the "Management Agreement").
Further information regarding the new directors, are as follows:
-- David L. Wood. Since 1978, Mr. Wood has been President of Zenith Appraisal and Land Consulting Ltd., a private property appraisal consulting company founded by him. Since 1994, Mr. Wood has been President of Double Check Consulting Inc., a private consulting entity. From 1999 to 2013, Mr. Wood was a director of Iplayco Corporation Ltd., a playground equipment designing and manufacturing company listed on the TSX Venture Exchange (TSXV:IPC) and served as the chair of its board of directors from 2008 until 2011. From 2008 to 2012, Mr. Wood was a director of Darford International Inc. (formerly White Rock Energy Inc.), a former TSX Venture Exchange listed marketing and manufacturing company, which, in October 2012, went into receivership and was suspended by the Exchange. Darford's listing was transferred to the NEX board of the Exchange in January 2013 for failing to meet the continued listing requirements. Darford is still an active business, however, remains suspended from trading on the NEX.. Mr. Wood was the President of Lander Energy Corporation (now Prosper Gold Corp.), a TSX Venture Exchange listed company from 2007 until 2012 and also served as one of its directors from 2007 until 2013. Since 1997, Mr. Wood has served as a director of Black Bull Resources Inc., a former TSX Venture Exchange listed mining company now listed on the NEX board (NEX:BBS). Mr. Wood served as a director of the Company from November 10, 2014 until the summer of 2016, and during that tenure filled a variety of Board roles including as a member of the Audit Committee and the Corporate Governance and Compensation Committee. Prior to the completion of the qualifying transaction pursuant to which the Company was formed, Mr. Wood was the President, Chief Executive Officer, Chief Financial Officer and a director of the Company's predecessor Technical Ventures RX Corp., then a TSX Venture Exchange listed capital pool company (CPC). Mr. Wood has also served as the President, Chief Executive Officer, Chief Financial Officer and a director of DataMiners Capital Corp. (TSXV:DMC.P) a TSX Venture Exchange listed CPC, since its formation in 2013. Mr. Wood is a professional appraiser and obtained his AACI designation from the Appraisal Institute of Canada (AIC).
-- Donald (Don) E. Friesen. Mr. Friesen has over 40 years of sales, marketing and entrepreneurial startup experience in a variety of industries including environmental remediation and demolition, heavy equipment sales, molten sulphur trucking and oilfield service. Mr. Friesen was one of two founders of HAZCO Environmental Services Ltd. ("HAZCO") in 1989, which grew from a small environmental service company to over 1,500 employees across western Canada and internationally while diversifying into landfill ownership and operation, demolition and construction services, environmental cleanup and remediation, waste services, and environmental drilling services. HAZCO was known as a Canadian leader in its field and was subsequently purchased in 2004 by the CCS Income Trust (TSX:CCR.UN, "CCS" the successor of Canadian Crude Separators and the predecessor of Tervita Corporation) where Mr. Friesen continued to serve in a leadership capacity until 2008 including as a trustee of the TSX-listed trust from 2004 to 2007. Prior to selling his interests in and leaving HAZCO/CCS, Mr. Friesen continued his serial entrepreneurial passion through a variety of passive and active investments in a diverse group of business sectors including real estate, crude to rail transloading and service, construction, equipment leasing and financing, retail service and construction. Mr. Friesen currently works with his son collectively managing and growing portfolio of assets of the Friesen Group, a private investment firm. Mr. Friesen has served as the Chief Executive Officer of both Coldstream Helicopters Ltd. and Global Petroleum Marketing Inc. since 2008. Mr. Friesen graduated with a Bachelor of Commerce from The University of Alberta in 1977.
The newly reconstituted Board confirmed that Angus Jenkins will continue to serve as Chair of the Board. In addition, the Board re-established the Company's Audit Committee and Corporate Governance and Compensation Committee, with all three of the current directors serving on both committees and Mr. David L. Wood serving as Chair of both committees.
Also in accordance with the Management Agreement, the Board has appointed Mr. Kyle Makofka as Chief Restructuring Officer. Mr. Makofka is currently the Managing Director of Drive Capital Corp. (founded in 2012), a private equity company focused on developing unique business through technology innovation and implementing quality based business management systems elevating companies to unrealized potential. In the past 27 years, Mr. Makofka has been Founder, Partner or Senior Manager in 8 different companies that have led him to operations in over 14 different Countries. These include roles such as General Manager at High Arctic Energy Service Inc, (TSX:HWO, a business with a $100M+ market capitalization during Mr. Makofka's tenure), Founder of Victory Energy Rentals (Monetized in 2004), Partner of Exact Canada Industries (Monetized in 2007), Founder/President of Victory Rig Equipment (Achieved $52 million in sales, Monetized with Trinidad Drilling Ltd. (TSX:TDG) in 2009), Partner of Red Flame Industries (Monetized in 2013 with Bolttech Mannings), and Founder of Quantum Petrophysics, a research and development company with patent pending nuclear logging technology. Mr. Makofka’s companies have been featured in Alberta Venture Magazine’s Fastest Growing List, and one was also a finalist for the Red Deer Chamber of Commerce Business of the Year Award.
The Company also confirms that the conversions of $1,184,000 in debts into shares first announced on December 22, 2016 have now been completed resulting in the aggregate issue of 6,725,000 common shares in the capital of the Company (each a "Share"). The debt conversions included (a) $644,000 in promissory notes converted at $0.16 per share resulting in the issuance of 4,025,000 Shares, (b) $500,000 of demand loans at $0.20 per share resulting in the issuance of a further 2,500,000 Shares, and (c) $40,000 owed pursuant to a Right of First Refusal Waiver Agreement between the Company and Wolverton Securities Inc. resulting in a further issuance of 200,000 Shares. As a result of these debt conversions there are now 74,583,119 Shares issued and outstanding.
The Company also confirms that its $1,000,000 secured convertible debenture, described in the Company's news releases of August 11 and September 2, 2016 (the "Debenture") was formally acquired by Drive Capital as initially announced on December 22, 2016. Drive Capital has since sold the Debenture to Wood Capital Ltd., a Barbados-based private equity investment firm controlled by Mr. Blake Wood, the adult son of Mr. Jed M. Wood., who controls Drive Capital.
In the midst of formalizing arrangements with the original subscriber for the Debenture for the acquisition of the Debenture, Drive Capital also agreed to provide emergency funding to the Company in an effort to allow it to satisfy certain critical trade payables. The emergency funding was provided pursuant to a demand loan agreement between the Company and Drive Capital (the "Demand Loan Agreement").
The Demand Loan Agreement provides for advances up to CDN $750,000 to be advanced in one or more tranches subject to the discretion of the lender. CDN $375,000 has been advanced pursuant to the Demand Loan Agreement to date. Amounts advanced under the Demand Loan Agreement will bear an annual rate of interest of 12% compounded and payable (interest only) monthly. The amounts advanced under the Demand Loan Agreement are secured by the same general security agreement granted by the Company as collateral security for the Debenture. Amounts advanced under the Demand Loan Agreement together with applicable interest is repayable on demand. Concurrent with Drive Capital's sale of the Debenture to Wood Capital, Drive Capital has also assigned the Demand Loan Agreement and sold the related indebtedness of the Company thereunder to Wood Capital Ltd.
Hemostemix intends to provide further updates in regards to the status of their phase 2 clinical trial and any realistic new financing possibilities for the Company as they arise, if any.
ABOUT HEMOSTEMIX INC.
Hemostemix is a public clinical-stage biotechnology company that develops and commercializes innovative blood-derived cell therapies for medical conditions not adequately addressed by current treatments. It is the first clinical-stage biotech company to test a stem-cell therapy in an international, multicenter, phase 2 clinical trial for patients with critical limb ischemia (CLI), a severe form of peripheral artery disease (PAD) caused by reduced blood flow to the legs. The phase 2 trial targets a participant’s diseased tissue with proprietary cells grown from his or her blood that can support the formation of new blood vessels.
Hemostemix currently enrolls participants in the phase 2 trial at four sites in South Africa and two sites in Canada. The Company recently received FDA clearance to commence clinical trials in the United States.
For more information, please contact:
Chief Restructuring Officer
Bay 1, 5220 Duncan Avenue,
PO Box 10
Blackfalds, Alberta T0M 0J0
Phone: (403) 506-3373
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined under the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This release may contain forward-looking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects," "plans," "anticipates," "believes," "intends," "estimates," "projects," "potential," and similar expressions, or that events or conditions "will," "would," "may," "could," or "should" occur. Although Hemostemix believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in forward-looking statements. Forward-looking statements are based on the beliefs, estimates, and opinions of Hemostemix management on the date such statements were made. Hemostemix expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise.