RepliCel Announces Signed Licensing & Co-Development Deal for Greater China – $RP

RepliCel Life Sciences Inc. (OTCQB: REPCF) (TSXV: RP) (FRA:P6P2), a company developing next-generation technologies in aesthetics and orthopedics, is pleased to announce it has now signed definitive agreements with YOFOTO (China) Health Industry Co. Ltd. (“YOFOTO”) sealing its partnership to commercialize three of RepliCel’s programs in Greater China.

The deal between the parties represents an investment in RepliCel by YOFOTO along with milestone payments, minimum program funding commitments, and sales royalties in exchange for an exclusive 15-year license to three of RepliCel products for Greater China (Mainland China, Hong Kong, Macau, and Taiwan) (the “Territory”).

The RepliCel-YOFOTO collaboration is focused on the development and commercialization in Greater China of RepliCel’s tendon regeneration cell therapy (RCT-01), skin rejuvenation cell therapy (RCS-01), and its injection technology in development for dermal applications (RCI-02) (excluding hair-related treatments).

YOFOTO’s up-front investment will be a CDN $5,090,000 purchase of shares at CDN $0.95 per Share and will include 20% warrant coverage exercisable at CDN $0.95 per Share for a period of two years. The deal structure also includes milestone payments (of up to CDN $4,750,000), sales royalties, and a commitment by YOFOTO to spend a minimum of CDN $7,000,000 on the RepliCel programs and associated cell processing manufacturing facility over the next five years in Greater China.

“In 2017 RepliCel delivered successful phase I data in all three of its cell therapy programs and functioning prototypes of its next-generation dermal injector,” stated RepliCel President & CEO, R. Lee Buckler. “We were committed to delivering a landmark partnership to RepliCel shareholders in 2018. The partnership with YOFOTO represents such a deal and provides RepliCel with not only an outstanding partner in Greater China but capital to move our programs forward in Europe and North America.”

“YOFOTO is a fast-growing company built on values related to beauty and healthy, active lifestyles,” stated YOFOTO Chairman Mr. Huang Jin Bao. “As a key part of developing and commercializing products related to these core values for our consumers, we are committed to being a leader in China in the commercialization of regenerative medicines. The RepliCel cell therapy and injection technologies focused on skin rejuvenation and tendon repair, are important building blocks in YOFOTO’s strategic healthcare vision. We are pleased to have structured a deal with RepliCel which results in YOFOTO not only being a development partner and commercial licensee but also an investor committed to contributing to RepliCel’s global success.”

The Deposit already paid by YOFOTO pursuant to the earlier signing of the binding term sheet remains in escrow pending closing. As part of the Transaction,  the  Company  has  agreed to grant YOFOTO certain financing participation rights along with a board seat nomination. Upon YOFOTO meeting certain defined conditions, relevant Chinese patents, once issued in China, will be assigned to a YOFOTO-owned Canadian subsidiary, with detailed assignment reversion rights upon failure to meet defined targets.

Closing of the Transaction represented in the signed agreements between the parties is subject to approval of  the  TSX  Venture  Exchange,  and  other  applicable regulatory  authorities including but not limited to the reviews and approvals by the State Administration of Foreign Exchange of China and other Chinese foreign investment regulatory authorities.

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