Radiopharm Theranostics Limited (ASX:RAD) entered into a binding agreement to acquire Pharma15 Corporation on March 3, 2023. Together with Pharma15's scientific co-founder Professor Ulmert, KOL Professor Ken Herrmann will join RAD's Scientific Advisory Board (SAB) and spearhead the development of the acquired technologies.
The purchase price under the Agreement is $4 million, which is to be paid 50% in cash and 50% in shares, split between two equal instalments, the first instalment upon completion scheduled for 3 March 2023 and the second instalment on the first anniversary following completion. 10.4 million Radiopharm ordinary shares will be issued in the first instalment as part of the purchase price, determined by the volume-weighted average price (vwap) of RAD shares traded on ASX during the seven consecutive trading days ending at the close of normal trading three trading days prior to the instalment. The number of shares to be issued for the second instalment on the first anniversary following completion will vary according to the exchange rate at that time and the seven consecutive trading days volume weighted average market price ending at the close of normal trading three trading days prior to the instalment. In addition to the purchase price, the Agreement sets out contingent consideration, subject to successful attainment of the significant value-adding clinical milestone of an Investigational New Drug Application with the U.S.A. Federal Drug Administration (FDA) for Pharma15's product. The contingent consideration under the Agreement, should the milestone be achieved, is $2.3 million, to be paid in shares. Shares issued to satisfy the contingent consideration are subject to a floor price equal to the volume-weighted average price of a RAD shares traded on the ASX during the 20 consecutive trading days ending at the close of normal trading immediately preceding the date of this Agreement, being $0.139. Using the same seven day vwap as the initial instalment of the purchase price and the current exchange rate, approximately 24 million shares would be issued if the milestone is achieved. The Company has no obligation to issue more than 47,000,000 shares in total under the Agreement, which is within the Company's existing 15% share issue capacity. Any contingent consideration not satisfied by the issue of shares will be settled by transfer of funds. The consideration will be funded from existing cash reserves, and the estimated share issue is within the Company's existing 15% share issue capacity. The transaction is anticipated Closing Date on or before 6 March 2023. The Agreement may be terminated for failure to meet usual conditions precedent, including any material adverse change in the circumstances of Pharma 15; otherwise only in the event of a material breach of the Agreement or by mutual consent.