Exhibit
99.4
FORM
51-102F3
MATERIAL
CHANGE REPORT
| 1. |
Name
and Address of Corporation
|
Lorus
Therapeutics Inc. (“Lorus” or the “Company”)
2
Meridian Road
Toronto,
Ontario
M9W
4Z7 Canada
Date
of Material Change
May
1, 2007.
The
press release reporting the material change was issued on May 1, 2007 in
Toronto, Ontario via Canada NewsWire Group, a copy of which is attached hereto
as Schedule “A”.
| 3. |
Summary
of Material Change
|
The
Company announced on May 1, 2007 that it has signed an agreement with 6707157
Canada Inc. (“Investor”) and an affiliate thereof to recapitalize and reorganize
Lorus’ business which, if completed, will result in the addition of
approximately $7.8 million in non-dilutive financing for the Company.
| 4. |
Full
Description of Material Change
|
The
Company announced on May 1, 2007 that it has signed an agreement with 6707157
Canada Inc. and an affiliate thereof to recapitalize and reorganize Lorus’
business which, if completed, will result in the addition of approximately
$7.8
million in non-dilutive financing for the Company.
Under
the terms of the agreement, Lorus will transfer all of its assets and
liabilities and all of the shares of its subsidiaries held by it to a new
company (“Newco”). Current securityholders in Lorus will exchange their
securities in Lorus for equivalent securities in Newco (the “Exchange”) and the
board of directors and management of Lorus will continue as the board of
directors and management of Newco. Newco will change its name to Lorus
Therapeutics Inc. and apply for a substitutional listing of the common shares
of
Newco on both the Toronto Stock Exchange (TSX) and the American Stock Exchange
(AMEX). Following the transaction, Newco will continue to carry on the business
carried on by Lorus but will have the benefit of the non-dilutive financing.
In
connection with the transaction and after the Exchange, the share capital of
Lorus will be reorganized into voting common shares and non-voting common shares
and the Investor will acquire from Newco and the Selling Shareholders (as
defined below) approximately 41% of the voting common shares and all of the
non-voting common shares by making a cash payment to Newco and the Selling
Shareholders equal to approximately $8.5 million on closing of the transaction
less an escrowed amount of $600,000, subject to certain post-closing
adjustments.
In
addition to the exchange of securities described above, shareholders who are
not
residents of the United States will receive voting common shares of Lorus and
shareholders who are residents of the United States will receive a nominal
cash
payment instead of voting common shares. As well, as a condition of the
agreement, High Tech Beteilingungen GmbH & Co. KG and certain other
shareholders of Lorus (the “Selling Shareholders”), representing approximately
24% of Lorus’ issued and outstanding share capital, have agreed to vote in
favour of the transaction and to sell to the Investor the voting common shares
to be received under the agreement at the same price per share as will be paid
to shareholders who are residents of the United States. The directors and
officers of Lorus who are security holders have expressed their intention to
vote in favour of the transaction.
Current
Lorus shareholders, other than residents of the United States and the Selling
Shareholders, will receive approximately 59% of the Lorus voting common shares
representing, upon completion of the transaction, an economic equity interest
of
approximately 0.5% of Lorus in addition to their continued equity interest
in
Newco.
The
restructuring will be completed by way of a plan of arrangement and is subject
to approval by the Ontario Superior Court of Justice and Lorus’ s
securityholders in accordance with applicable laws. The transaction is also
subject to regulatory approval, including approval of the TSX and AMEX.
Also
as a condition of the transaction, the holder of the secured convertible
debentures has agreed to vote in favour of the transaction. The Company has
agreed to repurchase such holder’s outstanding three million common share
purchase warrants at a purchase price of $252,000.
| 5. |
Reliance
on Subsection 7.1(2) or (3) of National Instrument
51-102
|
Not
applicable.
Not
applicable.
Aiping
Young
President
and Chief Executive Officer
(512)
336-7797
May
11, 2007.
Schedule
A - Press Release
LORUS
THERAPEUTICS ANNOUNCES REORGANIZATION RESULTING IN
APPROXIMATELY
$7,800,000 OF NON-DILUTIVE FINANCING
TORONTO,
CANADA
-
May
1, 2007
-
Lorus Therapeutics Inc. (“Lorus” or the “Company”) (TSX: LOR; AMEX: LRP), a
biopharmaceutical company specializing in the research and development of
pharmaceutical products and technologies for the management of cancer,
today
announced that it has signed an agreement with 6707157 Canada Inc. (“Investor”)
and an affiliate thereof to recapitalize and reorganize Lorus’ business which,
if completed, will result in the addition of approximately $7.8 million in
non-dilutive financing for the Company. If the transaction is completed, the
funds will be used to further advance the Company’s product pipeline without
diluting the equity interest of its shareholders.
Under
the terms of the agreement, Lorus will transfer all of its assets and
liabilities and all of the shares of its subsidiaries held by it to a new
company (“Newco”). Current securityholders in Lorus will exchange their
securities in Lorus for equivalent securities in Newco (the “Exchange”) and the
board of directors and management of Lorus will continue as the board of
directors and management of Newco. Newco will change its name to Lorus
Therapeutics Inc. and apply for a substitutional listing of the common shares
of
Newco on both the Toronto Stock Exchange (TSX) and the American Stock Exchange
(AMEX). Following the transaction, Newco will continue to carry on the business
carried on by Lorus but will have the benefit of the non-dilutive financing.
In
connection with the transaction and after the Exchange, the share capital of
Lorus will be reorganized into voting common shares and non-voting common shares
and the Investor will acquire from Newco and the Selling Shareholders (as
defined below) approximately 41% of the voting common shares and all of the
non-voting common shares by making a cash payment to Newco and the Selling
Shareholders equal to approximately $8.5 million on closing of the transaction
less an escrowed amount of $600,000, subject to certain post-closing
adjustments.
In
addition to the exchange of securities described above, shareholders who are
not
residents of the United States will receive voting common shares of Lorus and
shareholders who are residents of the United States will receive a nominal
cash
payment instead of voting common shares. As well, as a condition of the
agreement, High Tech Beteilingungen GmbH & Co. KG and certain other
shareholders of Lorus (the “Selling Shareholders”), representing approximately
24% of Lorus’ issued and outstanding share capital, have agreed to vote in
favour of the transaction and to sell to the Investor the voting common shares
to be received under the agreement at the same price per share as will be paid
to shareholders who are residents of the United States. The directors and
officers of Lorus who are security holders have expressed their intention to
vote in favour of the transaction.
Current
Lorus shareholders, other than residents of the United States and the Selling
Shareholders, will receive approximately 59% of the Lorus voting common shares
representing, upon completion of the transaction, an economic equity interest
of
approximately 0.5% of Lorus in addition to their continued equity interest
in
Newco.
The
restructuring will be completed by way of a plan of arrangement and is subject
to approval by the Ontario Superior Court of Justice and Lorus’ securityholders
in accordance with applicable laws. The transaction is also subject to
regulatory approval, including approval of the TSX and AMEX.
Also
as a condition of the transaction, the holder of the secured convertible
debentures has agreed to vote in favour of the transaction. The Company has
agreed to repurchase such holder’s outstanding three million common share
purchase warrants at a purchase price of $252,000.
“We
are delighted to have entered into these arrangements,” commented Dr. Aiping
Young, President and CEO of Lorus. “If approved by the securityholders we
believe this arrangement will provide Lorus with a significant increase in
liquidity without diluting existing securityholders. The additional funds will
lessen our dependence on the capital markets and will allow
us to accelerate the clinical development of our lead compounds and enhance
the
development of our drug pipelines. This
transaction will not affect Lorus’ current shareholder equity interests, or our
corporate focus except in a positive way through the additional financing.”
About
Lorus
Lorus
is a biopharmaceutical company focused on the research and development of novel
therapeutics in cancer. Lorus’ goal is to capitalize on its research,
preclinical, clinical and regulatory expertise by developing new drug candidates
that can be used, either alone, or in combination with other drugs, to
successfully manage cancer. Through its own discovery efforts and an acquisition
and in-licensing program, Lorus is building a portfolio of promising anticancer
drugs. Lorus has several product candidates in multiple Phase II clinical trials
and has completed one Phase II and one Phase III clinical trial. Lorus
Therapeutics Inc. is listed on the Toronto Stock Exchange under the symbol
LOR,
and on the American Stock Exchange under the symbol LRP.
Forward
looking statements
This
press release contains forward-looking statements within the meaning of Canadian
and U.S. securities laws. Such statements include, but are not limited to,
statements relating to: financings and corporate reorganizations, the
establishment of corporate alliances, the Company’s plans, objectives,
expectations and intentions and other statements including words such as
“continue”, “expect”, “intend”, “will”, “should”, “would”, “may”, and other
similar expressions. Such statements reflect our current views with respect
to
future events and are subject to risks and uncertainties and are necessarily
based upon a number of estimates and assumptions that, while considered
reasonable by us are inherently subject to significant business, economic,
competitive, political and social uncertainties and contingencies. Many factors
could cause our actual results, performance, achievements or the transactions
described in this press release to be materially different from any future
results, performance, achievements transactions described in this press release,
if at all, that may be expressed or implied by such forward-looking statements,
including, among others: the progress of negotiations; our ability to obtain
regulatory, securityholder and other approvals; our ability to obtain the
capital required for research and operations; the inherent risks in early stage
drug development including demonstrating efficacy; development time/cost and
the
regulatory approval process; the progress of our clinical trials; our ability
to
find and enter into agreements with potential partners; our ability to attract
and retain key personnel; changing market conditions; and other risks detailed
from time-to-time in our ongoing quarterly filings, annual information forms,
annual reports and annual filings with Canadian securities regulators and the
United States Securities and Exchange Commission.
Should
one or more of these risks or uncertainties materialize, or should the
assumptions set out in the section entitled “Risk Factors” in our filings with
Canadian securities regulators and the United States Securities and Exchange
Commission underlying those forward-looking statements prove incorrect, actual
results may vary materially from those described herein. These forward-looking
statements are made as of the date of this press release and we do not intend,
and do not assume any obligation, to update these forward-looking statements,
except as required by law. We cannot assure you that such statements will prove
to be accurate as actual results and future events could differ materially
from
those anticipated in such statements. Investors are cautioned that
forward-looking statements are not guarantees of future performance and
accordingly investors are cautioned not to put undue reliance on forward-looking
statements due to the inherent uncertainty therein.
Lorus
Therapeutics Inc.’s recent press releases are available through the Company’s
website at www.lorusthera.com.
Enquiries:
For
further information, please contact:
Lorus
Therapeutics Inc.
Dr.
Saeid Babaei, 1-416-798-1200 ext. 490
ir@lorusthera.com