Press Release

Kalytera Announces Private Placement of Convertible Debenture Units

By March 5, 2019 No Comments

NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH U.S. NEWSWIRE SERVICES

Kalytera Therapeutics, Inc. (TSX VENTURE: KALY and OTCQB: KALTF) (the “Company” or “Kalytera”) announced today that it is proceeding with a private placement (the “Offering”) under which it intends to sell C$787,500 aggregate principal amount of convertible debenture units for an aggregate purchase price of C$750,000 (representing an original issue discount equal to 5% of the purchase price). The convertible debenture units will consist of an aggregate of $787,000 principal amount of 10.0% secured convertible debentures (the “Convertible Debentures”) and an aggregate of 12,115,384 common share purchase warrants (each, a “Warrant”).

The Convertible Debentures will bear interest from the date of closing at 10.0% per annum, payable quarterly in arrears on the last business day of May, August, November and February of each year commencing May 31, 2019, and will mature two years following the closing of the Offering (the “Maturity Date”).

The Company’s obligations under the Convertible Debentures will be guaranteed by its material subsidiaries, and such guarantee obligations will be secured by substantially all of the assets of such subsidiaries.

The Convertible Debentures will be convertible at the option of the holder into common shares of the Company (“Common Shares”) at any time prior to the close of business on the earlier of the third business day prior to the Maturity Date and the third business day prior to any date fixed for redemption or repayment of the Convertible Debentures, at a conversion price of (i) C$0.065 per Common Share for the first twelve (12) month period following the closing date of the Offering and (ii) C$0.10 per Common Share for the second twelve (12) month period following the closing date of the Offering, in each case subject to customary adjustments in certain events.

Each Warrant will be exercisable to acquire one Common Share (a “Warrant Share”) at an exercise price of $0.065 per Warrant Share for a period of two years following the closing date of the Offering, subject to customary adjustments in certain events and, provided that if, at any time following the date that is four months following the closing date of the Offering, the volume weighted average trading price of the Common Shares equals or exceeds C$0.13 for a period of 20 consecutive trading days, the Company may, on prior written notice, accelerate the expiry date of the Warrants to the date that is 20 business days from the date of such notice. Any unexercised Warrants shall thereafter automatically expire.

The Convertible Debentures and the Warrants constituting 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 of the Offering.

The Company intends to use the net proceeds of the Offering for working capital and general corporate purposes. On closing of the Offering, the Company will pay to the investor under the Offering a loan fee in the amount of C$20,000, which sum will be deducted from the gross proceeds of the financing, and the Company will reimburse the investor in the amount of up to US$15,000 for its legal costs related to the Offering.

Closing of the Offering is expected to occur on or about March 6, 2019. 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 State or to, of for the account or benefit of, U.S. persons absent registrations 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 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
Email: info@kalytera.co

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.