Genoptix Enters into New Agreements to Acquire Rosetta Genomics for $9 Million in Cash

– Value to Rosetta Genomics’ Equity Holders is Preliminarily Estimated to be $0.40 – $0.45 Per Ordinary Share, After Deductions for Debt, Warrant Termination Payments, Fees, Expenses and Other Items
– Rosetta Genomics Strongly Urges Shareholders to Vote for New Transaction as its Cash Position is Insufficient to Fund Operations Beyond a Short Period of Time

CARLSBAD, CA, PHILADELPHIA, PA and REHOVOT, ISRAEL / ACCESSWIRE / February 27, 2018 / Genoptix, Inc., a leading oncology diagnostic laboratory, and Rosetta Genomics Ltd. (NASDAQ: ROSG), a genomic diagnostics company that improves treatment decisions by providing timely and accurate diagnostic information to physicians, jointly announce that they have entered into new definitive agreements under which Genoptix will acquire Rosetta Genomics for a total gross purchase price of $9 million. After deducting expected payments for outstanding debt, convertible debentures, warrant termination payments, professional fees, expenses and other items, this purchase price equates to an amount that is preliminarily estimated to be $0.40 – $0.45, in cash, for each ordinary share of Rosetta Genomics. Genoptix is a portfolio company of Ampersand Capital Partners and 1315 Capital.

Genoptix will first purchase Rosetta Genomics’ PDx business pursuant to a stock purchase agreement for $1.0 million in cash, which is expected to close by the end of this week. Under a separate merger agreement, Genoptix will purchase the remainder of Rosetta Genomics’ business for $8.0 million in cash, subject to certain adjustments.

The transactions have been unanimously approved by the Board of Directors of both companies, and the closing of the merger is expected to occur during the second quarter of 2018, subject to approval by Rosetta Genomics’ shareholders at an extraordinary meeting of shareholders to be held on April 6, 2018 and to customary closing conditions.

In connection with the proposed merger, Rosetta Genomics intends to file a proxy statement with the Securities and Exchange Commission (“SEC”). Shareholders of Rosetta Genomics are urged to carefully review the proxy statement, when available, because it will contain important information about the proposed merger and the estimated closing purchase price for each ordinary share.

Upon closing of the merger, trading in shares of Rosetta Genomics on the Nasdaq Capital Market will cease, and Rosetta Genomics will become a wholly owned subsidiary of Genoptix.

“After a comprehensive review of strategic alternatives that included financings, acquisitions, mergers, asset monetization and corporate partnerships, we determined that this newly proposed transaction with Genoptix is in the best interest of all Rosetta Genomics stakeholders, including our equity holders,” stated Kenneth A. Berlin, President and Chief Executive Officer of Rosetta Genomics.

“We did not receive the shareholder votes necessary to approve the original merger agreement, and strongly urge shareholders to support this new agreement, as our cash position is insufficient to fund operations moving forward. Given our current market capitalization, potential for pending delisting from the Nasdaq Capital Market and the difficult financing environment for microcap molecular diagnostics companies, we do not believe we could raise sufficient capital to continue as a going concern for an extended period of time,” added Mr. Berlin.

“We were disappointed that a positive shareholder vote was not achieved on February 22, 2018. As the overall situation for Rosetta becomes increasingly challenging, we are hopeful that the April 6, 2018 vote will reflect that Genoptix’ acquisition of Rosetta is, as we believe, the best and most viable outcome for all parties,” said Joseph M. Limber, President and Chief Executive Officer of Genoptix.

Cantor Fitzgerald is serving as financial adviser to Rosetta Genomics on this transaction.

About Rosetta Genomics

Rosetta is pioneering the field of molecular diagnostics by offering rapid and accurate diagnostic information that enables physicians to make more timely and informed treatment decisions to improve patient care. Rosetta has developed a portfolio of unique diagnostic solutions for oncologists, urologists, endocrinologists, cytopathologists and other specialists to help them deliver better care to their patients. RosettaGX Reveal™, a Thyroid microRNA Classifier for classifying indeterminate thyroid nodules, as well as the full RosettaGX® portfolio of cancer testing services are commercially available through the Company’s Philadelphia, PA- and Lake Forest, CA-based CAP-accredited, CLIA-certified labs.

About Genoptix, Inc.

Genoptix is a leading clinical oncology laboratory specializing in hematology and solid tumors, and operates one of the largest hematopathology centers in the U.S. It provides personalized and comprehensive diagnostic services to hematologists, oncologists and pathologists, with a specialization in diagnosing cancers and disorders in bone marrow, blood and lymph nodes, as well as in solid tumor workups using molecular testing. Through an integrated approach to case management, Genoptix delivers individualized, actionable results for each patient to help the referring physician make the best treatment decision. For more information, please visit www.genoptix.com.

Notes: Genoptix is a registered trademark of Genoptix, Inc. Any other names of actual companies, organizations, entities, products or services may be the trademarks of their respective owners.

About Ampersand Capital Partners

Founded in 1988, Ampersand is a middle market private equity firm dedicated to growth-oriented investments in the healthcare sector. Ampersand leverages its unique blend of private equity and operating experience to build value and drive superior long-term performance alongside its portfolio company management teams. Ampersand has helped build numerous market-leading companies across each of our core healthcare sectors, including Brammer Bio, Confluent Medical, Genoptix, Talecris Biotherapeutics and Viracor-IBT Laboratories. Additional information about Ampersand is available at www.ampersandcapital.com.

About 1315 Capital
1315 Capital provides expansion and growth capital to commercial-stage specialty pharmaceutical, medical technology, and healthcare services companies. 1315 Capital leverages experienced investors and proven operating teams to work alongside portfolio company management to rapidly grow platform companies into high value businesses that positively impact patients, physicians, and the broader healthcare system. For more information, visit www.1315capital.com.

Forward-Looking Statement Disclaimer

Various statements in this release concerning the future expectations, plans and prospects of Rosetta and Genoptix containing the words “expect,” “believe,” “will,” “may,” “should,” “project,” “estimate,” “anticipated,” “scheduled,” and like expressions, and the negative thereof, constitute forward-looking statements for the purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. These forward-looking statements represent expectations of Rosetta and Genoptix as of the date of this press release. Subsequent events may cause these expectations to change, and Rosetta and Genoptix disclaim any obligation to update the forward-looking statements in the future except as may otherwise be required by the federal securities laws. Rosetta and Genoptix may not be able to complete the proposed transactions on the terms described herein or other acceptable terms or at all. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, (1) the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement, (2) the failure to obtain the requisite approval of Rosetta’s shareholders or the failure to satisfy other closing conditions, (3) risks related to disruption of management’s attention from Rosetta’s and Genoptix’s respective on-going business operations due to the pending transaction, (4) the effect of the announcement of the pending transactions on the ability of Rosetta and Genoptix to retain and hire key personnel, maintain relationships with their respective customers and suppliers, and maintain their respective operating results and businesses generally and (5) risks that the actual purchase price per share could differ from our estimate because the actual amount of payments for outstanding debt, convertible debentures, warrant termination payments, professional fees, expenses and other items could differ from our assumptions. Further information on potential factors that could affect actual results is included in Rosetta’s reports filed with the SEC.

Additional Information and Where to Find It

In connection with the merger, Rosetta intends to submit relevant materials to the U.S. Securities and Exchange Commission (the “SEC”) and other governmental or regulatory authorities, including a proxy statement and form of proxy card. INVESTORS ARE URGED TO READ THESE MATERIALS CAREFULLY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT ROSETTA AND THE MERGER. The proxy statement, proxy card and certain other relevant materials (when they become available) and any other documents submitted by Rosetta to the SEC may be obtained free of charge at the SEC’s website at http://www.sec.gov. Investors are urged to read the proxy statement and the other relevant materials carefully when they become available before making any voting or investment decision with respect to the Merger.

Genoptix Media Contact
Jennifer Moritz
Zer0 to 5ive
jmoritz@0to5.com
(917) 748-4006

Rosetta Genomics Investor Contact:

LHA Investor Relations
Anne Marie Fields
(212) 828-3777
afields@lhai.com

SOURCE: Rosetta Genomics Ltd.

ReleaseID: 491141