Verisante Technology, Inc. Announces Update to Proposed RTO with SunRegen Healthcare AG

VANCOUVER, BC / ACCESSWIRE / October 31, 2024 / Verisante Technology, Inc. (TSXV:VER.H) ("Verisante") is pleased to announce a transaction update further to it's initial news release dated August 12, 2024, that it has entered into a binding Letter of Intent ("LOI") to acquire a 100% interest in SunRegen Healthcare AG ("SunRegen"), a Swiss pharmaceutical company. The proposed transaction is a Reverse Takeover ("RTO") pursuant to Policy 5.2 of the TSX Venture Exchange and the resulting issuer intends to qualify as a Tier 2 Life Sciences Issuer.

Pre-RTO Private Placement

SunRegen is pleased to announce a proposed pre-RTO private placement with an accredited investor in the amount of CHF1,333,333.40 (CAD$2,128,768.10) based on a pre-money valuation of CHF20,000,000. The price per share is equivalent to $0.80 per share in the resulting issuer post-RTO closing.

The investor will have a right to subscribe up to an additional CAD$2,000,000 of common shares at the same price per share within 90 days of the closing of the proposed RTO, subject to TSX-V Exchange Policies and acceptance. If the RTO transaction does not close by May 31, 2025, then SunRegen will issue 92,835 common shares to the investor at an issue price of CHF0.10.

No finders' fees or commissions were paid by SunRegen in connection with the private placement. The transaction is subject to SunRegen's board of directors and shareholder approval to increase the allowable share capital in the company and filing the required documents with the Swiss corporate registry. The proceeds will be used to fund the regulatory approval process for SBC003 as well as RTO transaction costs such as audit and legal fees. It is anticipated that except for transaction related costs, that the capital will be preserved until the RTO closing and combined with the concurrent financing, the details of which will be disclosed in a forthcoming update once terms have been finalized.

Definitive Agreement

The transaction terms previously announced will remain the same except that instead of a Share Exchange Agreement, the parties will proceed by way a Triangular Merger Agreement with the surviving entity being SunRegen Healthcare AG which will be a 100% owned subsidiary of Verisante. The change in the form of agreement and type of transaction will require shareholder approval from both companies' shareholders (see Shareholder Meeting below).

The parties have selected legal counsel in Canada and Switzerland to begin drafting the Definitive Merger Agreement. SunRegen has also selected a Canadian CPAB auditor to begin the auditing process for the last two fiscal years.

In addition, Verisante will apply to the TSX-V Exchange for an exemption from the sponsorship requirement for the proposed RTO transaction.

The proposed transaction is subject to, among other things, approval by both parties' boards of directors and shareholders, due diligence reviews, auditing of SunRegen's financial statements for the last two fiscal years by a CPAB participating auditor, TSX-V Exchange acceptance, as well as regulatory approval, as required, from the securities commissions where Verisante is fully reporting (British Columbia, Alberta and Ontario). There are no finder's fees payable in connection with the proposed RTO transaction, however, there will likely be finder's fees and commissions payable in connection with the concurrent financing which will be disclosed in a forthcoming update once the terms are finalized.

Shareholder Meeting

Due to the change in the proposed transaction from a Share Exchange to a Triangular Merger, the proposed RTO is a "business combination" as defined in Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). Therefore, pursuant to TSX-V Policies, MI 61-101 applies to the proposed RTO transaction and a special meeting of Verisante shareholders is required to approve the transaction. Verisante shareholders will also be asked to approve a name change to SunRegen Pharmaceuticals Inc. (or similar name) and elect a new board of directors. The Verisante special shareholder meeting will be combined with the annual general meeting and will be held as soon as practicable. SunRegen will also hold an extraordinary shareholder meeting to approve the proposed transaction in accordance with Swiss law.

Arm's Length Transaction

The proposed RTO transaction remains an Arm's Length Transaction (as such term is defined in the policies of the TSXV). No person or entity that is a Non-Arm's Length Party of SunRegen has any direct or indirect beneficial interest in Verisante, its shareholders or its assets prior to giving effect to the Transaction and no such persons are also Insiders of Verisante. Similarly, there is no known relationship between or among any person who or which is a Non-Arm's Length Party of SunRegen and any person who or which is a Non-Arm's Length Party to Verisante.

Transaction Terms

As previously announced, Verisante currently has 43,938,004 common shares and 1,000,000 common stock options outstanding with no preferred shares, warrants or any other securities outstanding. Initially, Verisante will consolidate its common shares on a 10 for 1 basis resulting in 4,393,800 common shares and 100,000 share options outstanding post-consolidation.

Verisante will then acquire 100% of SunRegen's outstanding equity in exchange for 39,544,204 of newly issued common shares on a post-consolidation basis ("Acquisition Shares") resulting in a total post-consolidation, post-acquisition, outstanding amount of 43,938,004 common shares. SunRegen shareholders will thus own 90% of the outstanding common shares of the resulting issuer on a pre-money basis. The acquisition shares will have a deemed value of $0.80 per share for an aggregate deemed acquisition value of $31,635,363.

The parties will conduct a capital raise prior to the RTO (the "Pre-RTO Financing") and/or concurrently for a minimum amount sufficient to comply with TSX-V Tier 2 Life Science Issuers' listing requirements including, but not limited to, an amount sufficient to comply with the 20% public float requirement and to carry out the listed issuer's business plan for at least 12 months plus CAD$100,000 of unallocated working capital. The Company will announce the further details regarding the terms or the proposed concurrent financing as soon as they have been determined.

The use of proceeds of the anticipated financing will be to advance the FDA regulatory approval of SunRegen's drug candidate SBC003 towards Clinical Trial Phase I by hiring a CRO to conduct CMC (Chemistry, Manufacturing, and Controls) and Safety studies for Retinitis Pigmentosa ("RP").

New investors participating in the Pre-RTO Financing subsequent to the date of the LOI will receive Acquisition Shares based on the same ratio as the existing SunRegen shareholders such that both Verisante and SunRegen shareholders will experience to the same dilution as a result of the anticipated capital raise.

SunRegen will become a 100% wholly owned subsidiary of Verisante upon Closing. The board of directors of the resulting issuer will have five members of which four will be nominated by SunRegen (see Proposed Officers and Directors in our August 12, 2024 news release for details).

The proposed transaction is subject to, among other things, approval by both parties' boards of directors and shareholders, due diligence reviews, auditing of SunRegen's financial statements for the last two fiscal years by a CPAB participating auditor, TSX-V Exchange acceptance, as well as regulatory approval, as required, from the securities commissions where Verisante is fully reporting (British Columbia, Alberta and Ontario). There are no finder's fees payable in connection with the proposed RTO transaction, however, there will be finder's fees and commissions payable in connection to the financing which will be disclosed in a forthcoming update once the terms are finalized.

About SunRegen

SunRegen is a Switzerland based pharmaceutical company, incorporated under Swiss law, focused on the development of neurodegenerative related drugs. Currently, they are focusing on the development of their lead compound, SBC003, for the treatment of neuronal apoptosis-related diseases, starting with ophthalmic neurodegenerative diseases and gradually expanding to the treatment of CNS neurodegenerative diseases.

SunRegen intends to start in the ophthalmic field by applying for FDA drug approval for the treatment of Retinitis Pigmentosa (RP), and then expanding to the treatment of dry AMD and other degenerative diseases. Their leading drug candidate, SBC003, has demonstrated neuro-rescuing and neuroprotection through in-vitro & in-vivo experiments and clinical cases, and has the ability to treat neurodegenerative diseases by directly targeting the causes. SunRegen has been issued a patent for its SBC003 drug compound across eight countries including the US, China and Japan, and has two more international patent applications pending.

RP is a hereditary family disease. Patients usually catch this disease at a young age, and it is generally manifested as apoptosis of peripheral retinal rod cells. At present, Luxturna^® (Voretigene Neparvovec) is the only approved RP Therapy to treat a small subset of

patients with RPE65 mutations, accounting for 0.3%-1% of the total number of RP patients. The vast majority of RP patients cannot obtain effective treatment. Currently, there are approximately 2 million RP patients worldwide.

According to Data Bridge Market Research the global RP market was worth US$11.57 billion and forecast to grow at a CAGR of 7.3% to reach US$20.33 billion by 2029.

To date approximately $6.3 million has been invested in the development of SBC003. Utilizing independent CROs, SunRegen has completed mice and monkey studies on the safety and efficacy of SBC003 with highly encouraging results and is now at the Investigational New Drug (IND) application stage of the FDA approval process. The next stage is to conduct toxicity, safety and formulation tests in preparation for a Phase II human clinical study. SunRegen uses independent CROs to perform its studies to comply with strict regulatory requirements and to operate more efficiently with a reduced overhead and headcount. More information about SunRegen is available on the company's website at www.sunregen.ch.

About Verisante

Verisante does not currently operate any active business other than to identify and complete a Reverse Takeover (RTO) with a company in one of its target sectors that demonstrates significant growth potential and/or value creation opportunities for shareholders.

Trading in the shares of Verisante will remain halted pursuant to section 2.6 of TSX-V Exchange Policy 5.2.

Completion of the transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable, disinterested shareholder approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the transaction, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of [insert name of Issuer] should be considered highly speculative.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this news release.

Company Contact:

Thomas Braun, President & CEO
Verisante Technology, Inc.
Telephone: (604) 716-5133
Email: info@verisante.com

Forward Looking Statements:

This news release contains "forward-looking information" within the meaning of Canadian securities legislation. Forward- looking information generally refers to information about an issuer's business, capital, or operations that is prospective in nature, and includes future-oriented financial information about the issuer's prospective financial performance or financial position.

The forward-looking information in this news release includes disclosure about the terms of the Transaction and the proposed structure of the Transaction.

Verisante and SunRegen made certain material assumptions, including but not limited to: prevailing market conditions; general business, economic, competitive, political and social uncertainties; delay or failure to receive board, shareholder or regulatory approvals; and the ability of the resulting issuer to execute and achieve its business objectives, to develop the forward-looking information in this news release. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.

Actual results may vary from the forward-looking information in this news release due to certain material risk factors. These risk factors include, but are not limited to: adverse market conditions; the inability of SunRegen or Verisante to complete the Transaction on the terms disclosed in this news release, or at all; the unavailability of exemptions from prospectus requirements for the issuance of Shares; the risks associated with the marketing and sale of Shares; refusal of the proposed directors or officers to act for any reason, including conflicts of interest; reliance on key and qualified personnel; and regulatory and other risks associated with the pharmaceutical industry in general. The foregoing list of material risk factors and assumptions is not exhaustive.

SOURCE: Verisante Technology, Inc.