Claritas Announces Revised, Improved Terms for Initial Tranche of Financing with Alumina Partners

Rhea-AI Summary

Claritas Pharmaceuticals (KALTF) has revised the pricing for an equity financing agreement with Alumina Partners. The initial tranche of CAD $150,000 will now see 1,081,081 units issued at CAD $0.13875, reducing dilution by over 250,000 shares. The warrant's exercise price is increased from CAD $0.1875 to CAD $0.21. The funds will mainly support the remaining costs of a Phase 1 clinical study of R-107, expected to conclude in Q1 2022. The agreement is subject to TSX Venture Exchange approval.

Positive

• Revised pricing reduces shareholder dilution by over 250,000 shares.
• Increased unit price from CAD $0.1125 to CAD $0.13875 reflects improved terms.

Negative

• Exercise price of the warrants increased from CAD $0.1875 to CAD $0.21.

SAN FRANCISCO, CA and TORONTO, ON, Jan. 26, 2022 (GLOBE NEWSWIRE) -- Claritas Pharmaceuticals, Inc. (TSX VENTURE: CLAS and OTC: KALTF) (the “Company” or “Claritas”) today announced revised, improved pricing for the initial tranche of funds that the Company will receive under its equity financing agreement (the “Agreement”) with Alumina Partners (Ontario) Ltd., (“Alumina”), an affiliate of Alumina Partners, LLC, a New York based private equity firm.

On January 17, 2022 the Company announced the terms for the initial CAD $150,000 tranche of funds that the Company requested under the Agreement (the “Initial Tranche”). As announced at that time, the Company agreed to issue to Alumina 1,333,333 units, comprised of one common share and one common share purchase warrant (the “Units”) at a price of CAD $0.1125 per Unit. The warrants were to have an exercise price of $0.1875.

Subsequent to the announcement on January 17^th, Alumina and the Company agreed to increase the pricing for the Initial Tranche in order to reduce shareholder dilution. Accordingly, the price per Unit for the Initial Tranche has been revised as follows: (1) the price per Unit will be CAD $0.13875, rather than CAD $0.1125, as previously announced; and (2) accordingly, the Company will issue to Alumina 1,081,081 Units, rather than 1,333,333 Units, as previously announced. The 1,081,081 Units will consist of 1,081,081 common shares and 1,081,081 warrants, rather than 1,333,333 common shares and 1,333,333 warrants, as previously announced. As consideration for Alumina’s agreement to the revised Unit pricing, the Company has agreed to increase the exercise price of the 1,081,081 warrants from the previously announced exercise price of CAD $0.1875 to CAD $0.21. Closing of the Initial Tranche is subject to the approval of the revised terms by the TSX Venture Exchange.

“The revised pricing for the Initial Tranche will reduce shareholder dilution by more than 250,000 shares, stated Robert Farrell, the Company’s President and CEO. “We are pleased with these improved terms, which are in the best interests of the Company and its shareholders, and we are pleased with Alumina’s willingness to make this concession”.

The Company’s principal intended use for the proceeds from the initial tranche of funds that will be received from Alumina is for payment of remaining costs of the Company’s Phase 1 clinical study of R-107, which study the Company expects to complete during Q1 this year.

About Claritas Pharmaceuticals
Claritas Pharmaceuticals, Inc. is a clinical stage biopharmaceutical company focused on developing and commercializing therapies for patients with significant unmet medical needs. Claritas leverages its expertise to find solutions that will improve health outcomes and dramatically improve people's lives.

• Website Home: https://claritaspharma.com/
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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 unfavorable results. Claritas undertakes no obligation to comment on analyses, expectations or statements made by third parties, its securities, or financial or operating results (as applicable). Although Claritas 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 Claritas’ control. The forward-looking information contained in this press release is expressly qualified by this cautionary statement and is made as of the date hereof. Claritas 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@claritaspharma.com

FAQ

What are the revised terms for Claritas Pharmaceuticals' equity financing agreement?

The revised terms include a unit price of CAD $0.13875 for 1,081,081 units, reducing dilution significantly.

How will the funds from the equity financing be used by Claritas Pharmaceuticals?

The funds are intended to cover the remaining costs of the Phase 1 clinical study of R-107, expected to be completed in Q1 2022.

What is the impact of the revised pricing on shareholder dilution for KALTF?

The revised pricing will reduce shareholder dilution by more than 250,000 shares.