Full Press Release Details
Oramed Announces $101,875,000 Short-Term Senior Secured Note Transaction
with Scilex Holding Company
NEW YORK, September 21, 2023 - Oramed
Pharmaceuticals Inc. (Nasdaq/TASE: ORMP), today announced that on September 21, 2023, Oramed and Scilex Holding Company (Nasdaq: SCLX)
("Scilex") entered into a Securities Purchase Agreement pursuant to which Scilex issued a Senior Secured Promissory Note (the
"Note") to Oramed. The Note is the culmination of Scilex's assumption of Sorrento Therapeutics Inc.'s ("Sorrento")
approximately $100 million senior secured Debtor In Possession ("DIP") term loan facility with Oramed. Oramed previously announced
the execution of term sheets relating to the Note on September 13, 2023.
The issuance of the Note is part of a series of
mutually beneficial transactions agreed upon by Oramed, Scilex and Sorrento, whereby (i) Sorrento and Oramed mutually terminated a previously
announced Stock Purchase Agreement (the "Sorrento SPA") between Oramed and Sorrento for the sale of Sorrento's equity
interests in Scilex to Oramed, which termination includes a release of claims by each of the parties relating to the Sorrento SPA, (ii)
Scilex was declared the winning bidder for the purchase of all of the Scilex common stock, preferred stock and warrants owned by Sorrento
for an aggregate purchase price of $110 million (which includes assumption of the DIP term loan facility); and Scilex and Sorrento entered
into a definitive purchase agreement with respect to such purchase, and (iii) Scilex assumed all of Sorrento's obligations as borrower
under the DIP term loan facility, upon which assumption the DIP term loan facility was amended, restated and replaced with the Note. The
U.S. Bankruptcy Court entered a final order approving the transactions following a hearing before the court on September 12, 2023.
In tandem with the Note, Scilex has issued to
Oramed new warrants to purchase an aggregate of up to 13 million shares of Scilex common stock at an exercise price of $0.01 per share
and each with restrictions on exercisability, of which, warrants to purchase up to 8.5 million shares are subject to certain vesting restrictions.
In addition, Scilex transferred to Oramed warrants to purchase 4 million shares of Scilex common stock at an exercise price of $11.50
per share that Scilex purchased from Sorrento. Oramed has received customary registration rights with respect to the shares of Scilex
common stock underlying these warrants.
The primary terms of the Note include, among others:
"In our opinion, Scilex has great intrinsic
value that is not currently realized, based on the company's growth trajectory, commercial portfolio and infrastructure, and its
robust clinical stage pipeline," stated Oramed CEO Nadav Kidron. "We believe that this Senior Secured Note, along with the
warrant package, is a favorable outcome to Oramed while also supporting Scilex in executing on its growth opportunities."
Proskauer Rose LLP served as legal advisor and
H.C. Wainwright & Co. served as financial advisor to Oramed in connection with these transactions.
About Oramed Pharmaceuticals
Oramed Pharmaceuticals (Nasdaq/TASE: ORMP) is
a platform technology pioneer in the field of oral delivery solutions for drugs currently delivered via injection. The company's
novel Protein Oral Delivery (POD ) technology is designed to protect drug integrity and increase absorption. Oramed has offices
in the United States and Israel.
For more information, please visit www.oramed.com.
Forward-Looking Statements
press release contains forward-looking statements, which may generally be identified by the use of the words "anticipates,"
"expects," "intends," "plans," "should," "could," "would," "may,"
"will," "believes," "estimates," "potential," "target," or "continue"
and variations or similar expressions and include statements about the benefits of the Securities Purchase Agreement and related transactions
with Scilex and Sorrento, the value of Scilex, its growth trajectory, commercial portfolio and infrastructure and clinical stage pipeline.
These statements are based upon the current expectations and beliefs of management and are subject to certain risks and uncertainties
that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties
include, but are not limited to, risks and uncertainties discussed in the Company's most recent annual or quarterly report and detailed
from time to time in the Company's other filings with the Securities and Exchange Commission, which factors are incorporated herein
by reference and the following factors: the risk that Scilex may be unable to service the debt provided by the Note and the impact
of the Note obligations on Scilex's liquidity; risks associated with the Company's ability to recover the proceeds and/or
collateral under the Note and related agreements; the possibility that the anticipated benefits of the transaction with Scilex and Sorrento
are not realized when expected or at all, including as a result of the impact of, or problems arising from, the ability of Scilex to repay
the Note and the ability of the Company to realize the value of the warrants; risks associated with the fluctuating market price and liquidity
of the Scilex common stock underlying the warrants; exposure to potential litigation in connection with the transactions, all of which
could cause the actual results or performance of Oramed to differ materially from those contemplated in such forward-looking statements.
These forward-looking statements speak only as of the date hereof. Oramed undertakes no obligation to update any of these forward-looking
statements to reflect events or circumstances after the date hereof or to reflect actual outcomes, unless required by law.