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APAC Resources Inc. and XORTX Pharma Corp. Announce Closing of Reverse Take-over, Financing, Consolidation and Name Change
Vancouver, BC – January 10, 2018 – APAC Resources Inc. (“APAC”) (CSE:APG:CNX) and XORTX Pharma Corp. (“XORTX”) are pleased to announce the completion of the previously announced reverse take-over and acquisition by APAC of all of the issued and outstanding shares (“XORTX Shares”) of XORTX (the “Acquisition”). The resulting company, XORTX Therapeutics Inc. (“XRX” or the “Company”) is focused on developing drug therapies for rare “orphan” disease indications such as polycystic kidney disease, and the treatment of health consequences caused by chronic high serum uric acid (hyperuricemia), including Type 2 Diabetic Nephropathy, cardiovascular disease and diabetes.
Details of the Acquisition are set out in the Listing Application dated December 1, 2017, available for review under APAC’s profile on SEDAR (sedar.com) and on the Canadian Securities Exchange (“CSE”) website (thecse.com).
The Company also announces the appointment of new management and the resumption of trading of its common shares on the CSE on or about Thursday, January 11, 2018. The trading symbol “XRX” has been reserved for the Company.
Pursuant to the Acquisition, APAC consolidated its share capital on the basis of one post-consolidation common share of APAC (“APAC Shares”) for every four pre-consolidation APAC Shares (the “Consolidation”). Following the Consolidation, there were 5,095,500 APAC Shares issued and outstanding. APAC acquired 100% of the outstanding XORTX Shares in consideration for the issuance of APAC Shares (as constituted following the Consolidation) on the basis of 2.311 post-consolidation APAC Shares for every one issued XORTX Share which resulted in the issuance of 53,909,451 APAC Shares being issued to the holders of XORTX Shares.
The Company is also pleased to announce that it has raised $1,957,370 by way of a private placement through the issuance of 3,914,740 units (the “Units”), at a price of $0.50 per Unit, completed concurrently with the completion of the Acquisition (the “Financing”). Each Unit consists of one postconsolidation APAC Share and one APAC Share purchase warrant (“Warrant”), each Warrant entitling the holder to purchase one additional post-consolidation APAC Share at a price of $0.80 for a period of two years from the date of issuance of the Units. The terms of the Warrant provide that in the event that the APAC Shares trade on the CSE at a closing price of greater than $1.20 per share for a period of 10 consecutive trading days at any time after four months and one day after the closing date of the Financing, the Company may accelerate the expiry date of the Warrants by giving notice to the holders thereof by way of a news release and, in such case, the Warrants will expire on the 30th day after the date of dissemination of such news release. The Units are subject to a statutory hold period expiring on May 10, 2018. Finders fees in the aggregate amount of $45,000 and 90,000 Warrants were paid to registered broker dealers in connection with the Financing.
Name Change, New Management Team and Board of Directors
With the closing of the Acquisition and the Financing, APAC has changed its name to “XORTX Therapeutics Inc.”. The directors and senior executive officers of the Company are now:
Allen Davidoff Director, President and Chief Executive Officer
Dr. Allen Davidoff, Ph.D. is an experienced businessman, entrepreneur, corporate director and a cofounder of XORTX Pharma Corp. Prior to co-founding XORTX, he was the Chief Scientific Officer of Trillium Therapeutics, formerly Stem Cell Therapeutics Inc. (“Trillium”) (TRIL: NASDAQ). XORTX and Trillium are companies focused on research and development of therapeutics. Dr. Davidoff has been appointed President and Chief Executive Officer and is a Director of the Company.
John Meekison Chief Financial Officer
John Meekison, CPA, CMA, P. Log, is a career CFO and investment banker, currently serving as the Chief Financial Officer of Segra International Corp. and Exro Technologies Inc. He has spent the last fourteen years serving in a variety of executive management and CFO roles with both private and public companies, including eleven years as the CFO of a TSXV listed public pharmaceutical development company. Prior to that, Mr. Meekison spent fifteen years in corporate finance with a focus on raising equity capital for North American technology companies, including nine years at Haywood Securities Inc. Mr. Meekison received his Bachelor of Arts from the University of British Columbia and is a Chartered Professional Accountant (Certified Management Accountant), Certified Investment Manager and Professional Logistician.
Alan Moore Director
Dr. Alan Moore, Ph.D. has extensive experience as a leader in the pharmaceutical and biotechnology industry, with large and small publicly traded companies. Dr. Moore has extensive executive and leadership experience gained with Proctor and Gamble Co., as well as six years as Chief Executive Officer and Director of Stem Cell Therapeutics Inc.
Bruce Rowlands Director
Bruce Rowlands is an experienced businessman, corporate director and current Chief Executive Officer of Eurocontrols Inc., a technology company. Mr. Rowlands has extensive experience as an investment banker and executive corporate leader in the biotechnology industry through his experience as Vice President at Dominick and Dominick Securities Canada and Senior Vice President at Lorus Therapeutics, now Aptose Biosciences Inc., a leading Canadian biotechnology company that is listed on the TSX and Nasdaq.
Robert Coltura President of APAC stated, “The former Board of Directors of APAC is pleased to see the successful negotiation and completion of the Acquisition with XORTX and believes moving forward, XRX will provide shareholders with a reasonable and sound investment in the pharmaceutical industry. The Board would also like to thank all involved for their hard work in seeing the Acquisition through to completion.”
Dr. Allen Davidoff stated, “The XORTX team is pleased with the completion of this merger and private placement. Our focus can now turn to value creation and achieving the important milestones. This first important step in XORTX Therapeutics will accelerate advancement of our drug programs into therapies that when approved can help millions of individuals suffering with progressive kidney disease due to diabetic nephropathy and polycystic kidney disease. We are pleased to be the recipient of funding from Cato BioVentures and look forward to working with their group on our regulatory, clinical programs and partnering of our orphan program in the future.”
About XORTX Therapeutics Inc.
XORTX Therapeutics Inc. is a Calgary-based, drug focused, therapeutics development company with two clinical development programs aimed at developing first in class therapies to treat diabetic nephropathy and polycystic kidney disease, respectively by completing two phase II clinical trials. Future growth is expected to occur through a combination of innovation, in-licensing, acquisition and thereafter, outlicensing of post-phase II programs. Existing proprietary patents and new patents under development in XRX are based on the expansion of knowledge and technical expertise regarding progressive kidney disease and other health consequences of pre-diabetes and diabetes. It is anticipated that upcoming patent grants and additional patent filings will further fortify the Company’s existing programs to treat orphan progressive kidney disease, fatty liver disease, metabolic syndrome and health issues related to diabetes and diabetic nephropathy.
XORTX Therapeutics Inc.
President & Chief Executive Officer
(403) 607-2621 or firstname.lastname@example.org
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