On January 25, 2021, Acer Therapeutics Inc. entered into an Option Agreement with Relief Therapeutics Holding AG pursuant to which the Company granted Relief an exclusive option (the “Exclusivity Option”) to pursue a potential collaboration and license arrangement with the Company for the development, regulatory approval and commercialization of ACER-001 (sodium phenylbutyrate) for the treatment of various inborn errors of metabolism, including urea cycle disorders (UCDs) and Maple Syrup Urine Disease (MSUD). The Option Agreement provides a period of time up to June 30, 2021 for the parties to perform additional due diligence and to work toward negotiation and execution of a definitive agreement with respect to the potential collaboration for ACER-001. In consideration for the grant of the Exclusivity Option, (i) the Company will receive from Relief an upfront nonrefundable payment of $1.0 million, (ii) Relief provided to the Company a 12-month secured loan in the principal amount of $4.0 million, as evidenced by a Promissory Note (the “Note”) issued by the Company to Relief and (iii) the Company granted to Relief a security interest in all of its assets to secure performance of the Note, as evidenced by a Security Agreement (the “Security Agreement”). The Note is repayable in one lump sum within 12 months from issuance and bears interest at a rate equal to 6.0% per annum. If a definitive agreement with respect to the potential collaboration is not executed by the parties on or before June 30, 2021, the Exclusivity Option will terminate and the Note is repayable by the Company upon maturity. The Note contains certain customary events of default (including, but not limited to, default in payment of principal or interest thereunder or a material breach of the Security Agreement).