/NOT FOR DISSEMINATION IN THE UNITED STATES OR
THROUGH U.S. NEWSWIRE SERVICES/
Kalytera Therapeutics, Inc. (TSX VENTURE:KALY) (OTCQB:KALTF)
(the
"Company" or
"Kalytera")
announced today that it has entered into an agreement with Echelon
Wealth Partners Inc. (“Echelon” or the "Agent"), to lead a brokered
best efforts private placement of up to $5,000,000 aggregate
principal amount of convertible debenture units (the "Convertible
Debenture Units") at a price of $1,000 per Convertible Debenture
Unit (the “Offering”). Each Convertible Debenture Unit will
consist of: (i) $1,000 principal amount of 9.0% secured convertible
debentures (the "Convertible Debentures"); and (ii) 3,846 common
share purchase warrants (each whole warrant, a "Warrant") of the
Company (representing 50% warrant coverage on each Convertible
Debenture).
The Convertible Debentures will bear interest
from the date of closing at 9.0% per annum, payable semi-annually
in arrears on June 30, 2018 and thereafter semi-annually on the
last day of June and December in each year and will mature two
years following the closing of the Offering (the "Maturity
Date").
The Convertible Debentures will be senior
secured obligations of the Company and rank pari passu in right of
payment of principal and interest with all other Convertible
Debentures issued under the Offering and all previously existing
secured indebtedness of the Company.
The Agent will have an option to sell up to 750
additional Convertible Debenture Units, each having the same terms
as the Convertible Debenture Units above.
The Convertible Debentures will be convertible
at the option of the holder into common shares of the Company (the
“Common Shares”) at any time prior to the close of business on the
Maturity Date at a conversion price of $0.13 per Common Share (the
"Conversion Price"). Beginning on the date that is four months and
one day following the Closing Date (as hereinafter defined), the
Company may force the conversion of all of the principal amount of
the then outstanding Convertible Debentures at the Conversion Price
on 30 days prior written notice should the daily volume weighted
average trading price of the Common Shares be greater than $0.75
for any 10 consecutive trading days.
Each Warrant will be exercisable to acquire one
Common Share (a "Warrant Share") at an exercise price of $0.13 per
Warrant Share for a period of two years following the Closing Date,
subject to customary adjustments in certain events and, provided
that if, at any time following the date that is four months and one
day from the Closing Date, the daily volume weighted average
trading price of the Common Shares equals or exceeds $1.00 for any
10 consecutive trading days, the Company may, on prior written
notice, accelerate the expiry date of the Warrants to the date that
is 30 days following the date of such
notice. Any unexercised Warrants shall thereafter
automatically expire.
The Convertible Debentures and the Warrants
comprising the Convertible Debenture Units and any Common Shares
issuable upon conversion or exercise thereof, as applicable, will
be subject to a statutory hold period lasting four months and one
day following the Closing Date.
The Company intends to use the net proceeds of
the Offering to advance its Phase 2 clinical program evaluating the
use of cannabidiol in the prevention of graft versus host disease,
as well as for general corporate purposes. Completion of the
Company’s Phase 2 program will take approximately eight months, and
is required by the FDA prior to the initiation of a pivotal Phase 3
study. The Company anticipates that, following completion of the
Phase 2 study, it will initiate the Phase 3 study as quickly as
possible.
“Echelon is a leading Canadian investment bank
with expertise in the field of healthcare funding and a history of
successful transactions,” said Robert Farrell, J.D., Kalytera's
Chief Executive Officer. “We are delighted to announce this
agreement with Echelon, and we are looking forward to working with
them as we advance Kalytera’s program in using cannabidiol in the
prevention of graft versus host disease.”
Closing of the Offering is expected to occur on
or about December 14, 2017 (the "Closing Date"). The Offering is
subject to certain conditions including, but not limited to, the
receipt of all necessary regulatory and stock exchange approvals,
including the approval of the TSX Venture Exchange.
The securities being offered have not been, nor
will they be, registered under the United States Securities Act of
1933, as amended, and may not be offered or sold in the United
States or to, or for the account or benefit of, U.S. persons absent
registration or an applicable exemption from the registration
requirements. This press release shall not constitute an offer to
sell or the solicitation of an offer to buy nor shall there be any
sale of the securities in any State in which such offer,
solicitation or sale would be unlawful.
About Kalytera Therapeutics
Kalytera is pioneering the development of a next
generation of cannabinoid therapeutics. Through its proven
leadership, drug development expertise, and intellectual property
portfolio, Kalytera seeks to establish a leading position in the
development of novel cannabinoid medicines for a range of important
unmet medical needs, with an initial focus on graft versus host
disease (“GVHD”).
Kalytera also intends to develop a new class of
proprietary cannabidiol (“CBD”) therapeutics. CBD is a remarkable
compound that has shown activity against a number of
pharmacological targets. However, there are limitations associated
with natural CBD, including its poor oral bioavailability. Kalytera
will seek to develop innovative CBD formulations and prodrugs in an
effort to overcome these limitations, and to target specific
disease sites within the body. Kalytera intends to file composition
of matter and method of use patents covering its novel inventions,
with the goal of limiting future competition.
- Website Home: https://kalytera.co/
- News and Insights: https://kalytera.co/news/
- Investors: https://kalytera.co/investors/
Cautionary StatementsThis press
release may contain certain forward-looking information and
statements ("forward-looking information") within the meaning of
applicable Canadian securities legislation, that are not based on
historical fact, including without limitation in respect of the
closing of Offering and the timing thereof, the use of proceeds
from the Offering, its product candidate pipeline, planned clinical
trials, the completion of the Phase 2 program, the timing thereof
and the initiation of the Phase 3 study, regulatory approval
prospects, intellectual property objectives and other statements
containing the words "believes", "anticipates", "plans", "intends",
"will", "should", "expects", "continue", "estimate", "forecasts"
and other similar expressions. Readers are cautioned to not place
undue reliance on forward-looking information. Actual results and
developments may differ materially from those contemplated by these
statements depending on, among other things, the risk of failure to
obtain a Notice of Allowance for the Company’s other US Patent
Application 14/787,515 and the risk that future clinical studies
may not proceed as expected or may produce unfavorable results.
Kalytera undertakes no obligation to comment on analyses,
expectations or statements made by third-parties, its securities,
or financial or operating results (as applicable). Although
Kalytera believes that the expectations reflected in
forward-looking information in this press release are reasonable,
such forward-looking information has been based on expectations,
factors and assumptions concerning future events which may prove to
be inaccurate and are subject to numerous risks and uncertainties,
certain of which are beyond Kalytera's control. The forward-looking
information contained in this press release is expressly qualified
by this cautionary statement and are made as of the date hereof.
Kalytera disclaims any intention and has no obligation or
responsibility, except as required by law, to update or revise any
forward-looking information, whether as a result of new
information, future events or otherwise.
Contact Information
Robert Farrell President, CEO (888) 861-2008
info@kalytera.co
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