Great Basin Scientific Announces Exchange Of Series E Warrants

1.68 million Warrants exchanged for approximately 651,000 shares of Common Stock

SALT LAKE CITY--(BUSINESS WIRE)--Great Basin Scientific, Inc. (NASDAQ:GBSN), a molecular diagnostics company, announced today that it has successfully completed an exchange of its Series E Warrants for a reduced number of shares of its common stock. In the exchange, all of the Series E Warrants, which would have been exercisable for 1.68 million shares of common stock, will be exchanged for 650,160 shares of common stock.

“But more important, the Series E Warrants contained an anti-dilution provision that could have resulted in the issuance of as many as 3.36 million shares at a future date, as compared to the 650,160 shares we will issue to retire the warrants at this time.”

“With this exchange, we reduced the dilutive impact of the Series E Warrants by over 60% relative to the initial warrant issuance,” said Jeff Rona, Chief Financial Officer of Great Basin. “But more important, the Series E Warrants contained an anti-dilution provision that could have resulted in the issuance of as many as 3.36 million shares at a future date, as compared to the 650,160 shares we will issue to retire the warrants at this time.”

The Series E Warrants were originally issued in conjunction with Great Basin’s February 24, 2016 public financing. The warrants had a five-year expiration, a strike price of $5.60, were not exercisable for one year from their date of issuance and required stockholder approval. They contained a one-time anti-dilution adjustment that, one year from issuance, would have increased the number of shares underlying the warrants to the lesser of 7% of the shares outstanding or 3.36 million shares. The warrants also contained a price protection provision that would have reduced the strike price of the warrants if Great Basin had issued shares or securities exercisable or convertible for shares at a price below $5.60.

“This exchange is part of our ongoing efforts to simplify our capital structure, reduce dilution risk and reduce our derivative liability,” said Ryan Ashton, co-founder and Chief Executive Officer of Great Basin Scientific. “In addition, because the exchange reduces our derivative liability and increases our shares outstanding, potentially raising our market capitalization, it is a critical component of our plan to come back into compliance with the Market Value of Listed Securities (MVLS) requirement outlined in NASDAQ rule 5550(b).”

About Great Basin Scientific

Great Basin Scientific is a molecular diagnostics company that commercializes breakthrough chip-based technologies. The Company is dedicated to the development of simple, yet powerful, sample-to-result technology and products that provide fast, multiple-pathogen diagnoses of infectious diseases. The Company's vision is to make molecular diagnostic testing so simple and cost-effective that every patient will be tested for every serious infection, reducing misdiagnoses and significantly limiting the spread of infectious disease.

Forward-Looking Statements

This press release includes forward-looking statement regarding events, trends and business prospects, which may affect our future operating results and financial position, including statements regarding the closing of the Series E Warrant exchange on April 6, 2016, the issuance of shares in relation to the exchange increasing the Company’s market capitalization, the Company’s ability to regain compliance with NASDAQ listing requirements and similar statements. Forward-looking statements involve risk and uncertainties, which could cause actual results to differ materially, and reported results should not be considered as an indication of future performance. These risk and uncertainties include, but are not limited to: (i) our limited operating history and history or losses; (ii) our ability to develop and commercialize new products and the timing of commercialization; (iii) our ability to obtain capital when needed; and (iv) other risks set forth in the Company's filings with the Securities and Exchange Commission, including the risks set forth in the company's Annual Report on Form 10-K for the year ended December 31, 2015. These forward-looking statements speak only as of the date hereof and Great Basin Scientific specifically disclaims any obligation to update these forward-looking statements, except as required by law.