Sep 17, 2019 in Press Releases

XPhyto Therapeutics Closes Acquisition Of Vektor Pharma Tf Gmbh

Vancouver, Canada (September 17, 2019) – XPhyto Therapeutics Corp. (CSE:XPHY; FSE:4XT) (“XPhyto” or the “Company”) is pleased to announce that it has closed both the definitive share purchase agreement (the “Agreement”) with Vektor Pharma TF GmbH (“Vektor”) and the equipment purchase agreement (the “Equipment Agreement”) entered into with an affiliated company of Vektor, both of which were previously announced by the Company on August 26, 2019.

Vektor is a German narcotics manufacturer, importer, and researcher located approximately 170 kilometers west of Munich. For over a decade, the company and its team have been leaders in the design, testing and manufacture of thin film drug delivery systems, particularly transdermal patches and sublingual (oral) strips for the clinical management of pain. Vektor holds a number of valid narcotics licences pursuant to EU GMP certification and other governing regulations: Import Permit for drug dosage forms; Import Permit for cannabis; Manufacturing Permit for clinical samples; Manufacturing Permit for final drug product release; Analytical Permit for chemical and physical testing; Permit to handle narcotic drugs; and a Permit to handle animal tissue. Vektor’s various narcotics licences include authorizations related to conventional and cannabis-related prescription medications, including but not limited to: Buprenorphine, cannabis, Dronabinol, Fentanyl, Hydromorphone, Oxycodone, and THC.

“The Vektor transaction will accelerate XPhyto’s medicinal cannabis import into Germany and its drug delivery expertise, both of which are a critical part of our near-term revenue generation strategy,” said Hugh Rogers, CEO of XPhyto. “Further, with vape-based delivery systems now associated with significant potential health risks, XPhyto is extremely pleased to combine assets and expertise with Vektor, a specialist in thin film drug delivery systems. XPhyto is well positioned to capitalize on the next generation of cannabis investment opportunities, primarily clinical validation of safe and effective medicine and emerging European markets.”

Pursuant to the Agreement and the Equipment Agreement, the consideration is as follows: 1) 350,000 € cash due upon closing; 2) 200,000 common shares due upon closing; 3) 400,000 € units in the capital of the Company at CAD $1.00 per unit (the “Payment Units”) due upon closing. Each Payment Unit consists of one common share and one common share purchase warrant. The common shares are subject to a three-year escrow matrix. The warrants are exercisable into one common share of the Company at an exercise price of CAD $1.00 per share for a period of three years from closing; 4) 200,000 € in a convertible debenture with a maturity date that is six months from closing bearing an annual interest rate of 2.5%. The debenture is convertible into Payment Units at the option of the holder, at any time prior to the maturity date. Accrued interest will be paid in cash. Each common share purchase warrant is exercisable into one common share at an exercise price of CAD $1.00 per share for a period of three years from the conversion date; and 5) 150,000 € in a convertible debenture with a maturity date that is twelve months from closing bearing an annual interest rate of 2.5%. The debenture is convertible into Payment Units at the option of the holder, at any time prior to the maturity date. Accrued interest will be paid in cash. Each common share purchase warrant is exercisable into one common share at an exercise price of CAD $1.00 per share for a period of three years from the conversion date.

Pricing of the securities set out in the Agreement and Equipment Agreement was established pursuant to a price reservation filed with the Canadian Securities Exchange on August 6, 2019. In connection with the transaction, a consulting fee of 200,000 common shares will be paid to an armslength consultant on closing.

Media Inquiries North America
Mr. Knox Henderson
T: 604-551-2360
E: info@xphyto.com

Media Inquiries Europe
MC Services AG
Julia Hofmann, Andreas Jungfer
T: +49 89 210 228 0
E: xphyto@mc-services.eu