Great Basin Scientific Announces Update Of Series C Warrant Conversions

Approximately 4.3MM warrants remain unconverted, Company has approximately 60MM unissued, unreserved authorized shares of common stock available for conversion

SALT LAKE CITY--(BUSINESS WIRE)--Great Basin Scientific, Inc. (NASDAQ:GBSN), a molecular diagnostics company, today announced that it has approximately 60MM authorized, unreserved and unissued shares remaining and approximately 4.3MM remaining Series C warrants (including Series C Warrants acquirable upon exercise of outstanding options), which, if converted at Friday’s closing bid price of $0.15 would require the Company to issue approximately 64MM shares of common stock and would result in an “Authorized Share Failure” as defined under the Series C warrant agreement.

The Company had one previous Authorized Share Failure, which halted conversion of Series C warrants. During that time, the Company negotiated a previously announced amendment to the Series C warrants. Terms of the amendment call for expiration of the warrants, and mandatory conversion of all remaining warrants, at 5:00 p.m. New York City time on the 25^th trading day following the elimination of the Authorized Shares Failure. The Authorized Share Failure was eliminated at 5:00 p.m. New York City time on December 11^th , and the 25^th trading day, as defined by the Series C warrant agreement, under which December 24^th did not qualify as a trading day, will be Thursday January 21, 2016. Assuming there is not a second Authorized Share Failure, all unconverted Series C warrants will automatically convert on that day at 5:00 p.m. New York City time using the closing bid price from Tuesday January 19, 2016.

Should an Authorized Share Failure occur, the Company will cease accepting Series C warrants for conversion and will seek, through a special stockholder meeting, to increase its authorized shares outstanding. The Company expects that it will require 40-60 days to complete the proxy process, hold the special stockholder meeting and, assuming approval by stockholders, effect the increase in authorized shares. Once it again has shares available for issue it will resume converting Series C warrants. The date for the mandatory conversion of the Series C warrants will be delayed by one trading day for each trading day there exists an Authorized Share Failure; and the price at which the Series C warrants automatically convert will be determined once the actual mandatory conversion date is reestablished.

The Company also believes that its closing bid price on Friday January 15^th was unusual relative to the closing price on that day. The Company intends to continue to closely monitor its stock in the coming trading days and to report any suspicious trading activity to the appropriate regulatory authorities. And the Company may exercise its right, under the Series C warrant agreement, to settle warrants at a price it believes is correct under the terms of Series C warrant agreement until any dispute as to the applicable closing bid price can be properly resolved, at which point the Company would, if required, issue additional shares to any warrant holder who settled at the disputed share price.

The Company has 200MM authorized shares of common stock, of which 140MM are issued or contractually reserved for the holders of its Convertible Notes and other derivative securities, leaving 60MM shares available for issuance. As of Friday, January 15^th the Company had issued 17.5MM shares of common stock, and since Friday it has received Series C warrant conversion requests totaling 240,000 Series C warrants which will convert into another 2.2MM shares of common stock, bringing total shares issued and outstanding to approximately 19.7MM shares.

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.

Forward-Looking Statements

This press release includes forward-looking statements regarding the exercise and exchange of Series C warrants, the potential for an Authorized Share Failure, stockholder approval to increase authorized share capital, the Company’s monitoring and reporting of suspicious trading activity and related 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 of 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 Quarterly Report on Form 10-Q for the quarter ended September 30, 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.