Hamilton Thorne announces issuance of debentures

TORONTO, July 15 /CNW/ – Hamilton Thorne Ltd. (TSX-V: HTL), a leading provider of advanced laser systems and instruments for the stem cell research and fertility clinic markets, today announced that it has agreed to issue two-year redeemable convertible subordinated unsecured debentures (“Debentures”) in the aggregate principal amount of US$500,000 to a non-executive insider of the Company. The net proceeds from the sale of the Debentures will be used for general working capital purposes and to accelerate the development of Hamilton Thorne’s laser poration system.

The issuance of these Debentures represents a preliminary closing of a proposed private placement offering of Debentures. The Company’s Board of Directors has authorized the sale of up to an aggregate principal amount of US$750,000 of Debentures prior to August 1, 2010 or such later time as may be agreed. The Debentures will be issued in Canadian denomination at the applicable Bank of Canada noon exchange rate on the date of issuance. The 10 percent per annum simple interest payable on the Debentures is to be accrued and paid only upon the earlier of maturity or conversion of the Debentures. The private placement is subject to acceptance by the TSX Venture Exchange.

“This transaction provides us with greater financial flexibility in the near term to ensure that our sales and marketing efforts have the necessary support to continue to grow sales while at the same time dedicating new resources to product development of our laser poration system for stem cell research,” said Meg Spencer, Chief Executive Officer of Hamilton Thorne. “We believe induced pluripotent stem (iPS) cells, developed from adult cells, are a critical and rapidly growing segment of the stem cell market. Our laser poration system is designed to allow scientists to introduce new material into the nucleus of cells in order to reprogram the cells, without using the traditional viral agents or chemicals. While traditional methods have a number of drawbacks, our laser poration system, as designed, is anticipated to improve the accuracy and reduce the reprogramming procedure time, which will result in significant savings for laboratories.”

At maturity, the Debentures will convert at a 20 percent discount to the then market price, with a minimum conversion price of C$0.20 per share and a maximum conversion price of C$0.60 per share. The Debentures stipulate that, subject to the foregoing, in the event Hamilton Thorne completes an equity offering for gross process of at least C$3,000,000 (an “Equity Offering”), the Debentures will automatically convert, with a 10 percent discount to the Equity Offering price if the Equity Offering is completed in the first year of the Debenture and a 20 percent discount to the Equity Offering price if the Equity Offering is completed in the second year.

Pursuant to Multilateral Instrument 61-101 (“MI 61-101”), the insider subscription is a “related party transaction”. The Company is exempt from the formal valuation requirement of MI 61-101 in connection with the insider subscription in reliance on section 5.5(b) of MI 61-101 as no securities of the Company are listed or quoted for trading on the Toronto Stock Exchange, the New York Stock Exchange, the American Stock Exchange, the NASDAQ Stock Market or a stock exchange outside of Canada and the United States. Additionally, the Company is exempt from obtaining minority shareholder approval in connection with the insider subscription in reliance on section 5.7(1)(a) of MI 61-101 as the fair market value of the insider subscription does not exceed 25% of the Company’s market capitalization.

About Hamilton Thorne Ltd. (http://www.hamiltonthorne.com)
Hamilton Thorne’s advanced laser systems and instruments are rapidly emerging as the dominant products to facilitate precise procedures in the stem cell research and fertility clinic markets. Hamilton Thorne’s lead products, the ZILOS-tk and XYClone laser systems, attach to standard inverted microscopes and operate as robotic micro-surgeons, significantly reducing time and increasing efficiency in key in-vitro fertilization, stem cell, embryo, reproductive toxicology, and living cell procedures.

Hamilton Thorne’s growing customer base includes pharmaceutical companies, biotechnology companies, fertility clinics, university research centers, and other commercial and academic research establishments worldwide. Current customers include world-leading research labs such as Harvard University, MIT, Yale, DuPont, Monsanto, Charles River Labs, Jackson Labs, Merck, Novartis, Pfizer, Oxford University, and Cambridge.

Neither the Toronto Venture Exchange, nor its regulation services provider (as that term is defined in the policies of the exchange), accepts responsibility for the adequacy or accuracy of this release.

Certain information in this press release may contain forward-looking statements. This information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict. Actual results might differ materially from results suggested in any forward-looking statements. The Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward looking-statements unless and until required by securities laws applicable to the Company. Additional information identifying risks and uncertainties is contained in filings by the Company with the Canadian securities regulators, which filings are available at www.sedar.com.

For further information: David Wolf, President, Hamilton Thorne Ltd., 978-299-1715,ir@hamiltonthorne.com; Ross Marshall, The Equicom Group, 416.815.0700 x238,rmarshall@equicomgroup.com