its a lot to digest, but overall we are now a revenue generating company, whereby 6 months a go we had 700,000 in licensing fee only.....you will find a lot of negatives in the 10q/a but you will also find a whole bunch of positives....revenue is a positive, positive equity is a positive, filing a 10q is a positive, intending on more acquisitions is a positive, renegotiating the veneto deal is a positive, and a whole lot more......
there will be a lot of bumps in the road ahead, as we try to get some financing to satisfy many of the much needed research and development, acquisitions, and other expenses.....
Executive summary:
On January 17, 2017, we acquired a 51% interest in Hema Diagnostic Systems, LLC (“HDS”). On December 1, 2018, we acquired the remaining equity of HDS, and HDS became a wholly owned subsidiary. We intend to focus resources on HDS’ business as well as other potential acquisition candidates going forward, but do not intend to discontinue our pre-Acquisition activities.
We intend to focus resources on HDS’ business, and on the businesses of Regentys, Olaregen and the MSAO business acquired from Veneto, as well as additional acquisition targets, but do not intend to discontinue our historical activities. However, we will not pursue our historical business if we do not receive substantial financing for that purpose. Olaregen is launching an FDA 5 a wound healing product.
On October 3, 2018, we acquired the First Closing Assets from Veneto, primarily consisting of the operating assets of (a) system dispensing pharmacies, (b) a central adjudicating pharmacy, (c)a wholesale pharmaceutical purchasing company, and (d) an in-network laboratory.
On November 1, 2018 we consummated the acquisition of the Second Closing Assets, consisting primarily of Veneto’s management services organization business and two additional ancillary services. The aggregate price for the First Closing Assets and the Second Closing Assets was $30,000,000. We issued a promissory note in the principal amount of $35,000,000 (the “New Note”) consisting of the $30,000,000 purchase price and a $5,000,000 original issue discount, as the sole consideration payable on the Second Closing Date. In addition, we agreed to assume approximately $3.4 million in outstanding institutional debt of Veneto subsidiaries, but will have use of Veneto cash which would otherwise have been applied to paying down the debt.
On March 29, 2019, the Company entered into an Amendment Agreement (the “Amendment”) with Veneto and the equity owners of Veneto (the “Veneto Members”) entered into restructuring the payment of the New Note that provided in lieu of any cash payments, the Company would delivery 8,400,000 shares of the Company’s common stock (the “Generex Shares”) to be delivered on or before April 22, 2019; plus an aggregate 5,500,000 shares of the Company’s subsidiary,common stock of Antigen Express, Inc.
..The Company and the Veneto Members established a value of the Company’s common stock related to this conversion of debt at $2.50/share, but upon a final pay date of June 14, 2020 (the “Pay Date”) the Veneto Members will receive additional compensatory shares if following results in a positive number: $2.50 (the “Strike Price"
per Generex Shares times the shares issued (8,400,000) minus the Sale Price of the proceeds of sale of any Generex Shares by the Members in the interim (“Sale Price”) times the number of Generex Shares sold (“Shares Sold”) divided by the Spot Price of the price of the common voting shares of the Company’s common stock on the Pay Date (“Spot Price”). Any sale above the Strike Price shall be discarded.
•The Sale Price shall, for calculation under this agreement shall be no less than $1.50 per share. Any actual proceeds of sale that are less than $1.50 per shares shall be calculated at $1.50 regardless of the actual proceeds of sale. As such, the Veneto Members shall have downside protection from $2.50 to $1.50.
•The downside protection lapses if the volume weighted average price of the Generex Shares, in any period of 90 consecutive trading days, is over $5 per share.
On January 7, 2019, we acquired a majority interest in Regentys Corporation for an aggregate of $15,000,000. $400,000 was paid in cash and the remainder was paid by the issuance of a promissory note. $250,000 principal was paid against the note as of January 31, 2019 and an additional $450,000 principal was paid subsequently for a total aggregate of $650,000 of principal payments in addition to the $400,000 initial payment. Regentys is developing a non-surgical treatment for inflammatory bowel diseases such as ulcerative colitis and Crohn’s disease.
On January 7, 2019, we acquired a majority interest in Olaregen Therapeutix Inc. (“Olaregen”) for an aggregate of $12,000,000. $400,000 was paid in cash and the remainder was paid by the issuance of a promissory note. $500,000 principal was paid against the note as of January 31, 2019 and an additional $500,000 was paid subsequently for a total aggregate of $1,000,000 of principal payments in addition to the $400,000 initial payment. Olaregen is launching an FDA-510(k) cleared wound care product.
there will be a lot of bumps in the road ahead, as we try to get some financing to satisfy many of the much needed research and development, acquisitions, and other expenses.....
Executive summary:
On January 17, 2017, we acquired a 51% interest in Hema Diagnostic Systems, LLC (“HDS”). On December 1, 2018, we acquired the remaining equity of HDS, and HDS became a wholly owned subsidiary. We intend to focus resources on HDS’ business as well as other potential acquisition candidates going forward, but do not intend to discontinue our pre-Acquisition activities.
We intend to focus resources on HDS’ business, and on the businesses of Regentys, Olaregen and the MSAO business acquired from Veneto, as well as additional acquisition targets, but do not intend to discontinue our historical activities. However, we will not pursue our historical business if we do not receive substantial financing for that purpose. Olaregen is launching an FDA 5 a wound healing product.
On October 3, 2018, we acquired the First Closing Assets from Veneto, primarily consisting of the operating assets of (a) system dispensing pharmacies, (b) a central adjudicating pharmacy, (c)a wholesale pharmaceutical purchasing company, and (d) an in-network laboratory.
On November 1, 2018 we consummated the acquisition of the Second Closing Assets, consisting primarily of Veneto’s management services organization business and two additional ancillary services. The aggregate price for the First Closing Assets and the Second Closing Assets was $30,000,000. We issued a promissory note in the principal amount of $35,000,000 (the “New Note”) consisting of the $30,000,000 purchase price and a $5,000,000 original issue discount, as the sole consideration payable on the Second Closing Date. In addition, we agreed to assume approximately $3.4 million in outstanding institutional debt of Veneto subsidiaries, but will have use of Veneto cash which would otherwise have been applied to paying down the debt.
On March 29, 2019, the Company entered into an Amendment Agreement (the “Amendment”) with Veneto and the equity owners of Veneto (the “Veneto Members”) entered into restructuring the payment of the New Note that provided in lieu of any cash payments, the Company would delivery 8,400,000 shares of the Company’s common stock (the “Generex Shares”) to be delivered on or before April 22, 2019; plus an aggregate 5,500,000 shares of the Company’s subsidiary,common stock of Antigen Express, Inc.
..The Company and the Veneto Members established a value of the Company’s common stock related to this conversion of debt at $2.50/share, but upon a final pay date of June 14, 2020 (the “Pay Date”) the Veneto Members will receive additional compensatory shares if following results in a positive number: $2.50 (the “Strike Price"
per Generex Shares times the shares issued (8,400,000) minus the Sale Price of the proceeds of sale of any Generex Shares by the Members in the interim (“Sale Price”) times the number of Generex Shares sold (“Shares Sold”) divided by the Spot Price of the price of the common voting shares of the Company’s common stock on the Pay Date (“Spot Price”). Any sale above the Strike Price shall be discarded. •The Sale Price shall, for calculation under this agreement shall be no less than $1.50 per share. Any actual proceeds of sale that are less than $1.50 per shares shall be calculated at $1.50 regardless of the actual proceeds of sale. As such, the Veneto Members shall have downside protection from $2.50 to $1.50.
•The downside protection lapses if the volume weighted average price of the Generex Shares, in any period of 90 consecutive trading days, is over $5 per share.
On January 7, 2019, we acquired a majority interest in Regentys Corporation for an aggregate of $15,000,000. $400,000 was paid in cash and the remainder was paid by the issuance of a promissory note. $250,000 principal was paid against the note as of January 31, 2019 and an additional $450,000 principal was paid subsequently for a total aggregate of $650,000 of principal payments in addition to the $400,000 initial payment. Regentys is developing a non-surgical treatment for inflammatory bowel diseases such as ulcerative colitis and Crohn’s disease.
On January 7, 2019, we acquired a majority interest in Olaregen Therapeutix Inc. (“Olaregen”) for an aggregate of $12,000,000. $400,000 was paid in cash and the remainder was paid by the issuance of a promissory note. $500,000 principal was paid against the note as of January 31, 2019 and an additional $500,000 was paid subsequently for a total aggregate of $1,000,000 of principal payments in addition to the $400,000 initial payment. Olaregen is launching an FDA-510(k) cleared wound care product.
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