SAN FRANCISCO and TEL AVIV, Israel, Aug. 24, 2018 (GLOBE NEWSWIRE) -- Kalytera Therapeutics, Inc. (TSX VENTURE:
KALY and OTCQB: KALTF) (the "Company" or "Kalytera") today provided an update on the previously
announced arrangements reached with the former shareholders of Talent Biotechs Ltd. of Israel (“Talent”) modifying
the Company’s obligation to make certain payment to such shareholders.
Kalytera acquired its program in the prevention and treatment of graft versus host disease
(“GVHD”) in February 2017 through the acquisition of Talent. Under the purchase agreement with the former
Talent shareholders, Kalytera is obligated to make certain contingent payments to them upon the achievement of various milestones,
including upon issuance of patents by the U.S. Patent and Trademark Office (the “USPTO”). As previously
announced, two such patents issued earlier this year, and Kalytera then became obligated to make milestone payments to the former
Talent shareholders of US$2 million with respect to each such patent, or US$4 million in the aggregate. Kalytera has
exclusive worldwide rights to these issued patents through an Exclusive License Agreement with MOR Research Applications, Ltd. of
Israel (“MOR”).
The previously announced arrangement with the former shareholders of Talent required that upon closing of
Kalytera’s public offering of units (the “Offering”), Kalytera would make a minimum payment to the former Talent
shareholders of US$1.5 million, plus, if the net proceeds of the Offering exceeded US$1 million (after deducting the US$1.5 million
payment and commissions an expenses incurred in the Offering), then that excess would be paid to the former Talent shareholders up
to the balance owing.
Based on the above, in connection with closing of the Offering (including the exercise of the over-allotment
option thereunder) Kalytera has now paid the former Talent shareholders the amount of US$2,011,380. While an additional
US$226,675 would have been payable to the former Talent shareholders from the proceeds of the Offering based on the initial
arrangement, under an agreed modification to the arrangement, Kalytera was permitted to continue to defer payment of that amount in
order to leave Kalytera with additional cash proceeds to fund its operations.
The current balance owing to the former Talent shareholders is now US$1,988,620, which amount will be evidenced
by a promissory note maturing July 31, 2019 and which will bear interest at the rate of 8% per annum. The promissory note
will be secured by the rights of Talent as licensee under the Exclusive License Agreement with MOR.
Pursuant to the previously announced deferral arrangement with the former Talent shareholders, such former
holders are entitled to an additional payment in connection with the deferral, which will be in the amount of CDN$1,038,218.73. The
former Talent shareholders have now confirmed their election to receive such payment in units that will have terms and conditions
and pricing substantially similar to the units that were issued in the Offering. The amount owing will be extinguished
through the issuance of 9,438,352 units. Consistent with the units issued in the Offering, each unit will have a deemed issue
price of C$0.11 and will consist of one common share and one half of one common share purchase warrant. Each whole common
share purchase warrant will have an exercise price of C$0.155 per common share. The issuance of these units is subject to approval
by the TSX Venture Exchange (“TSXV”).
The Company will issue the units, which will be subject to a four month hold period, as soon as practicable upon
receipt of approval of the TSXV.
About Kalytera Therapeutics
Kalytera Therapeutics, Inc. is pioneering the development of cannabidiol (“CBD”) therapeutics.
Through its proven leadership, drug development expertise, and intellectual property portfolio, Kalytera seeks to establish a
leading position in the development of CBD medicines for a range of important unmet medical needs, with an initial focus on GVHD
and treatment of acute and chronic pain.
Cautionary Statements
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This 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 its product candidate pipeline, planned clinical trials, 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 that applicable regulatory approvals will not be obtained or the
risk that future clinical studies may not proceed as expected or may produce unfavourable 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 are 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.
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