Great Basin Scientific Inc. (fka GBSNQ)

[TPX]

GBSN News! Great Basin Scientific Announces Corporate Restructuring and Reduction in Principal of 2016 Convertible Note

SALT LAKE CITY, Feb. 10, 2017 (GLOBE NEWSWIRE) -- Great Basin Scientific, Inc. (GBSN), a molecular diagnostics company, today announced a restructuring and cost reduction plan that is designed to focus Company resources on areas that accelerate the revenue growth of its current commercial product line. As part of the restructuring plan, Great Basin has streamlined certain manufacturing and administrative processes and will eliminate approximately 50 employees nationwide. Between these changes, along with other previously implemented cost reductions and added efficiencies, the Company expects to remove between $10 million to $12 million from its annual cash burn. The Company also announced today that it has significantly reduced the 2016 Convertible Note to $36 million.

“Since the Company’s inception, we have focused on building a pipeline of molecular diagnostic solutions that provide a unique and powerful combination of menu versatility, ease-of-use and low cost,” said Ryan Ashton, co-founder and chief executive officer of Great Basin. “This investment in R&D and operations infrastructure has resulted in our current product menu of four FDA-cleared tests and panels with two additional assays in the 510(k) process at the FDA. Customer response to our expanding menu has been very positive, and we are undertaking these changes to assure that we are well-positioned to grow the Company aggressively and sustainably.”

The Company does not anticipate material pre-tax charges as a result of the restructuring and cost reduction plan. Several cost reduction activities will be initiated immediately, with all activities expected to be substantially completed by the end of the current quarter.

The Company is continuing development of its previously announced assays and expects to commence new clinical trials later in 2017.

2016 Convertible Note Amended
Great Basin has also reached an agreement with holders of its 2016 Convertible Note to reduce the Note’s principal by $35.6 million to $36.3 million outstanding as of February 9, 2017. In exchange, the amount of cash in the Company’s restricted cash account will be reduced to $21.5 million from $57.0 million.

“Our progress in terms of product menu, customer base and sales funnel expansion, along with the cost reductions we are implementing, led us to determine that the original funding available under the terms of the 2016 Convertible Notes was greater than we required,” said Jeff Rona, chief financial officer of Great Basin. “We appreciate the investment and support from our Noteholders and their willingness to work with us on reducing our debt obligation under the 2016 Note.”

http://finance.yahoo.com/news/great-basin-scientific-announces-corporate-140000606.html