Transaction Designed to Enhance Shareholder Value By Unlocking Value of
the Epigenetics Platform
TSX Exchange Symbol: RVX
CALGARY, April 8, 2013 /CNW/ - Resverlogix Corp. (TSX:RVX)
("Resverlogix") today announced that its Board of Directors has
approved a proposal to spin-out its subsidiary, RVX Therapeutics Inc.
("RVX Therapeutics"), which will focus on innovative drug research and
development by leveraging its epigenetics platform. RVX Therapeutics
will exclude Apolipoprotein A-1 ("Apo A-1") and RVX-208 technologies,
rather focusing on multiple therapeutic indications including
autoimmune diseases and cancer.
The spin-out is to be implemented by way of a court-approved Plan of
Arrangement ("the Arrangement") pursuant to the Business Corporations
Act (Alberta). The implementation of the Arrangement will be subject
to, among other things, final board approval of the Arrangement and a
The spin-out of RVX Therapeutics reflects the Board of Director's and
management's belief that it is in the best interests of shareholders to
create a future value for its epigenetics platform and to provide a
mechanism for the retention of possible future royalties on RVX-208
sales, depending on the deal structure finally negotiated.
Based on the belief that the RVX-208 program currently accounts for the
entire market value of Resverlogix and that the value of the
epigenetics platform is unrealized, the spinning out of RVX
Therapeutics will facilitate a corporate structure that is more likely
to reflect an accurate valuation of the epigenetics platform.
The objective of the spin-out is to split the clinical RVX-208 program
(Resverlogix) from the epigenetics platform (RVX Therapeutics). In
doing so, this process will create distinct corporate environments such
that Resverlogix is structurally ready for acquisition while RVX
Therapeutics' future value could be realized through a licensing and/or
partnering business model.
This has the potential to unlock the future value for RVX Therapeutics
via research and development of the epigenetic mechanism and
establishes a potential royalty stream from RVX-208. Enhanced long-term
shareholder value is provided through direct valuations related to any
future licensing and partnering deals.
In addition, the new structure will minimize future dilutions should
either corporation require additional equity capital.
Resverlogix will continue to focus on the clinical development of
RVX-208, its small molecule for the treatment of atherosclerosis
through therapeutic increases in Apo A-1. In addition, Resverlogix will
continue with its RVX-208 related clinical trial for diabetes and the
soon to launch Alzheimer's disease clinical trial.
RVX Therapeutics will focus on innovative drug research and development
by leveraging its epigenetics platform in multiple diseases including
autoimmune and oncology, excluding Apo A-1 and RVX-208 technology.
It is anticipated that the directors and senior officers of RVX
Therapeutics will continue to consist of current directors and senior
officers of Resverlogix.
Resverlogix shareholders to receive one share in each of the two
Under the terms of the Arrangement, Resverlogix's shareholders will
receive shares of a newly incorporated company ("Spinco") that will own
all of the shares of RVX Therapeutics on a basis that is proportional
to their interest in Resverlogix. Every Resverlogix shareholder will
receive one share in Spinco for every share held in Resverlogix at the
Every Resverlogix warrant holder at the effective date will receive one
warrant in Spinco for every warrant held in Resverlogix. The exercise
price of Resverlogix warrants would be reduced in accordance with the
terms of the applicable warrant by an amount on a per share basis to
reflect the fair market value of Spinco and the reduction would be
allocated to the exercise price of the replacement Spinco warrants. If
a Resverlogix warrant holder wishes to participate in the Arrangement
and receive common shares of Spinco at the effective date, the warrant
holder will need to exercise their Resverlogix warrants prior to the
effective date of the Arrangement to acquire Resverlogix common shares.
Shares of Spinco will not be listed on an exchange initially, however
the Board of Directors will give due consideration to whether it is in
the best interests of shareholders of Spinco that the shares of Spinco
are listed and at what time.
The implementation of the Arrangement will be subject to, among other
things, board, shareholders, court and regulatory approvals, including
TSX acceptance of the Arrangement.
Resverlogix must hold a special meeting of shareholders to approve the
Arrangement. The record and meeting dates are anticipated to be on or
around April 25, 2013 and May 28, 2013, respectively. A management
information circular containing a complete description of the
Arrangement and a description of tax implications to shareholders will
be sent to shareholders of Resverlogix in connection with the special
meeting to approve the Arrangement.
There can be no assurances or guarantees that the spin-out will be
Resverlogix will host a live conference call and webcast with Q&A at 11
a.m. MDT, April 8, 2013.
Conference call-in numbers:
Canada & USA Toll Free Dial In: 1-800-319-4610
Outside of Canada & USA call: +1-604-638-5340
About Resverlogix Corp.
Resverlogix Corp. (TSX:RVX) is a clinical stage cardiovascular company
with an epigenetic platform technology that modulates protein
production. Resverlogix is developing RVX-208, a first-in-class small
molecule for the treatment of atherosclerosis. RVX-208 is the first BET
bromodomain inhibitor in clinical trials. New compounds arising from
Resverlogix' epigenetic drug development platform function by
inhibiting BET bromodomains and have the potential to impact multiple
diseases including autoimmune diseases, cancer, neurodegenerative
diseases and diabetes mellitus. Resverlogix's common shares trade on
the Toronto Stock Exchange (TSX: RVX). For further information please
visit www.resverlogix.com. Follow us on our blog at http://www.resverlogix.com/blog/
This news release may contain certain forward-looking information as
defined under applicable Canadian securities legislation, that are not
based on historical fact, including without limitation statements
containing the words "believes", "anticipates", "plans", "intends",
"will", "should", "expects", "continue", "estimate", "forecasts" and
other similar expressions. In particular, this news release includes
forward looking information relating to the structure and timing of the
proposed transaction, future royalties on RVX-208, future value of RVX
Therapeutics and the epigenetics platform and future research and
development activities. Our actual results, events or developments
could be materially different from those expressed or implied by these
forward-looking statements. We can give no assurance that any of the
events or expectations will occur or be realized. By their nature,
forward-looking statements are subject to numerous assumptions and risk
factors including but not limited to those assumptions and risk factors
discussed in our Annual Information Form and most recent MD&A which are
incorporated herein by reference and other documents we file from time
to time with securities regulatory authorities, which are available
through SEDAR at www.sedar.com. The forward-looking statements contained in this news release are
expressly qualified by this cautionary statement and are made as of the
date hereof. We disclaim any intention and have no obligation or
responsibility, except as required by law, to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
For further information, please contact:
Donald J. McCaffrey
President & CEO
Director of Investor Relations
SOURCE: Resverlogix Corp.