NEW YORK (GenomeWeb) – Precipio announced today that it has settled a lawsuit filed by investment group Crede Capital Group, which alleged that that diagnostics firm had failed to meet the obligations of a securities agreement.
In its lawsuit, Crede stated that it had previously invested $5 million into Transgenomic — which Precipio acquired last year — in exchange for stock and warrants, and that Transgenomic failed to make requisite cash payments upon exercise of the warrants. The suit, which was seeking more than $2 million, further charged that Precipio did not provide any cash and stock when Crede attempted the exercise the warrants after the Transgenomic merger.
Precipio said that it has now agreed to pay Crede $1.925 million — either in cash, stock, or a combination of the two at Precipio's option — over a 15-month period, settling the dispute. Additional terms were not disclosed.
Precipio added that it has now reduced the roughly $19 million in Transgenomic debt it had assumed to approximately $7 million.
"Our financial team has worked diligently to achieve settlements that have significantly reduced the inherited liabilities from the merger," Precipio CEO Ilan Danieli said in a statement. "Arriving at successful settlements … will allow management to fully focus time and resources on growth of the business."
Shares of Precipio were up nearly 30 percent at $.66 during late morning trading today on the Nasdaq.