Press Release

Kalytera Announces Closing of First Tranche of Private Placement of Common Shares and Common Share Purchase Warrants

By September 16, 2019 No Comments

Kalytera Therapeutics, Inc. (TSX VENTURE: KALY and OTCQB: KALTF) (the “Company” or “Kalytera”) is pleased to announce the closing of the first tranche of its private placement, for 10,946,423 common shares of the Company and 10,946,423 common share purchase warrants for aggregate gross proceeds of C$505,084.38. Alere Financial Partners, a division of Cova Capital Partners LLC, acted as agent and as compensation will receive a cash commission equal to C$30,410.47 and will be issued 675,788 warrants bearing the same terms as those issued in the offering. All securities issued in the offering are subject to a hold period expiring on January 14, 2020 in accordance with applicable securities laws. The offering remains subject to final TSX Venture Exchange (“TSXV”) approval.

The first tranche closing is part of a larger private placement transaction (the “Private Placement”) under which the Company proposes to raise up to approximately CDN $1.5 million (USD $1.14 million) pursuant to the issuance of units, each consisting of one common share and one common share purchase warrant, at a price of C$0.045 per unit, pursuant to the grant of a discretionary waiver by the TSXV of its C$0.05 minimum pricing requirement. As previously disclosed, Mr. Farrell, the Company’s Chief Executive Officer, and Mr. Erickson, a member of the Company’s board of directors, invested at a price of C$0.05 per unit (as will any other non-arm’s length party that participates in the Private Placement), instead of the C$0.045 per unit price made available to all other investors.

As previously disclosed in more detail in the Company’s press release dated September 11, 2019, proceeds of the Private Placement will be used to fund preparatory work for initiation of the Company’s Phase 3 clinical registration study for its lead product development program evaluating cannabidiol (“CBD”) for the prevention of acute graft versus host disease (“GVHD”). Proceeds will also be used to augment the Company’s working capital as it enters into discussions with potential corporate partners for its GVHD program.

Existing Shareholder Participation

Subject to applicable securities laws, the Private Placement will be open, for a limited time ending on September 18, 2019, to all existing shareholders who held the Company’s common shares on September 9, 2019 (the “Record Date”), including pursuant to the “existing shareholder exemption” available under the securities laws of most jurisdictions in Canada. Under the “existing shareholder exemption”, investors will generally be limited to an investment of no more than C$15,000, unless the investor has obtained advice from a registered investment dealer regarding the suitability of the investment. Investors may also participate without such limitations if they qualify as an “accredited investor” under applicable securities laws or satisfy other available exemptions. Each purchaser will be required to complete a subscription agreement which confirms, among other things, the availability of an exemption from the prospectus requirements of applicable securities laws in respect of the sale of units to such purchaser. Each purchaser will be subject to a minimum subscription amount of C$1,000 in order to participate in the Private Placement. In the event of over-subscription, the Company will determine allocations between shareholders at its sole discretion.

Existing shareholders as of the Record Date who are interested in participating in the Private Placement should contact the Company at: Potential investors should indicate the amount of their intended investment in either Canadian or U.S. dollars, as well as the email address at which the Company should contact them to provide further details regarding the Private Placement and relevant transaction documentation.

In order to participate in the Private Placement, existing shareholders must notify the Company by no later than 5:00 p.m. Eastern time on Wednesday, September 18, 2019 (the “Notification Deadline”).

Additional Terms

Each common share purchase warrant will have an exercise price of CDN $0.05, and a term of 36 months. Beginning on the date that is four months plus one day following the applicable issuance date, Kalytera may accelerate the expiry date of such common share purchase warrants to the date that is 30 days following notice of such acceleration should the daily volume weighted average trading price of Kalytera’s common shares be greater than C$1.00 for any 10 consecutive trading days on the TSXV.

The securities offered have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act”) or any U.S. state securities laws, and were not offered or sold in the United States or to, or for the account or benefit of, United States persons absent registration or any applicable exemption from the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws. This news release shall not constitute an offer to sell or the solicitation of an offer to buy securities in the United States, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

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.

Kalytera Company Contact

Robert Farrell
President and CEO
Phone: (888) 861-2008

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 future clinical studies may not proceed as expected or may produce unfavourable results and the risk that required regulatory approvals may not be obtained. 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.