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NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISTRIBUTION IN THE UNITED STATES

VANCOUVER, British Columbia, June 15, 2022 (GLOBE NEWSWIRE) — Algernon Pharmaceuticals Inc. (the “Company” or “Algernon”) (CSE: AGN) (FRANKFURT: AGW0) (OTCQB: AGNPF) is pleased to announce that it is making a public offer to purchase units of the Company (the “Units“or the”Titles offered”) with Research Capital Corporation as sole agent and sole bookrunner (the “Agent), in each of the provinces of Canada (other than Quebec) (the “Offer”). The size of the offering and the price of the Units will be determined in the context of the market.

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Each Unit will consist of one Class A common share of the Corporation (a “Ordinary share“) and one common share purchase warrant of the Company (a “To guarantee“).

Each warrant entitles the holder thereof to purchase one common share (a “Warrant action”) for a period of 5 years from the date of issue. The exercise price of the Warrants (the “Warrant exercise price”) will be determined in the context of the market.

The Company will use commercially reasonable efforts to obtain the Canadian Securities Exchange (“CSE”) approval to permit the following anti-dilution protection feature of the Warrants. In the event of downward financing during the period of 5 years following the closing of the Offer (a “Dilutive issue”), the Warrants contain anti-dilution protection, to adjust the exercise price of the Warrants and to increase the number of Warrant Shares issuable thereunder if the Common Shares are sold or issued for consideration per share less than the exercise price of the warrants (subject to certain exemptions), provided that the exercise price is not less than 50% of the public offering price per unit ( the “Floor price”).

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Provided that if, at any time prior to the expiration date of the Warrants, the volume weighted average trading price of the Common Shares on the CSE, or other principal exchange on which the Common Shares are listed, exceeds at 300% of the Warrant’s exercise price for 20 consecutive trading days, the Company may, within 10 Business Days of the occurrence of such event, send a notice to Warrantholders provoking the date of expiration of the Warrants on the date that is 30 days after the date of such event. notice (the “Accelerated exercise period”). All unexercised Warrants will automatically expire at the end of the accelerated exercise period.

The Company will grant the Agent an option (the “Over-allotment option”) to increase the size of the Offer up to an additional number of Units, and/or their components, which, in aggregate, would be equal to 15% of the total number of Offered Securities to be issued in the framework of the Offering, to cover over-allotments, if any, and for market stabilization purposes, exercisable at any time and from time to time up to 30 days after the closing of the Offering.

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The net proceeds from the offering of Units will be used to fund research and development programs, general and administrative expenses and for working capital purposes.

Closing of the Offering is expected to occur around the week of June 20, 2022 or on a date mutually agreed between the Company and the Agent. The Company will obtain the necessary approvals to list the Common Shares comprised in the Units, as well as the Shares with Warrants and the Common Shares issuable upon the exercise of Compensation Warrants, for trading on the CSE. In addition, the Company will use commercially reasonable efforts to obtain the necessary approvals for the listing of the Warrants on the CSE.

In connection with the Offering, the Company intends to file a prospectus supplement (the “Extra charge“) to the simplified base shelf prospectus of the Company dated May 5, 2021 (the “Shelf Prospectus“), with the securities authorities of each of the provinces of Canada. Copies of the Shelf Prospectus and, after filing, the supplement to be filed in connection with the Offering, may be viewed on SEDAR at www.sedar.com. The Shelf Prospectus contains, and the Supplement will contain, important detailed information about the Company and the Offering. Prospective investors should read the Supplement and the accompanying Shelf Prospectus and the other documents the Company has filed on SEDAR at www.sedar.com before making an investment decision.

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The securities offered have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Law“), and such securities may not be offered or sold in the United States or to, or on behalf of, or for the benefit of “U.S. Persons” (as defined in Regulation S of the U.S. Securities Act) in the lack of registration or an applicable exemption from the registration requirements of US securities law and applicable US securities laws. Securities may be offered and sold by way of private placement in the United States and to, or on behalf of or for the benefit of “U.S. Persons” (as defined in Regulation S of the U.S. Securities Act) pursuant to a exemption from registration requirements under United States securities law and in accordance with the applicable securities laws of any state in the United States. All securities offered and sold in the United States will be issued as “restricted securities” within the meaning of Rule 144(a)(3) of the US Securities Act. Securities may also be sold in such other jurisdictions as the Company and the Agent may agree. This press release does not constitute an offer to sell or the solicitation of an offer to buy, and there will be no sale of securities in any jurisdiction where such offer, solicitation or sale would be unlawful.

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About Algernon Pharmaceuticals Inc.

Algernon is a drug repurposing company that investigates safe and already approved drugs for new disease applications, effectively and safely moving them into new human trials, developing new formulations and seeking new regulatory approvals on world markets. Algernon specifically studies compounds that have never been approved in the United States or Europe to avoid writing off-label prescriptions.

Algernon has filed worldwide intellectual property rights for Ifenprodil for the treatment of respiratory diseases.

CONTACT INFORMATION

Christophe J. Moreau
CEO
Algernon Pharmaceuticals Inc.
604.398.4175 ext. 701
[email protected]
[email protected]
www.algernonpharmaceuticals.com

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Neither the Canadian Securities Exchange nor its Market Regulator (as that term is defined in the policies of the Canadian Securities Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward-looking statements
This press release contains certain statements that constitute forward-looking statements or information under applicable Canadian securities laws, including statements relating to the expected size and price of the offering and the securities offered, the terms of securities offered, the expected time of the closing of the Offer, the ability of the Company to satisfy all the closing conditions of the Offer, the planned use of the proceeds of the Offer, the Warrants containing an anti-dilution protection , the listing of the Warrants on the CSE, the gross proceeds of the Offering and the use of these proceeds. These forward-looking statements are subject to numerous known and unknown risks, uncertainties and other factors, some of which are beyond the Company’s control, which could cause actual results or events to differ materially from those stated, anticipated or implied. in forward-looking statements. statements. These risks and uncertainties include general economic and financial market conditions, stock market volatility, the Company’s ability to obtain the necessary consents for the Offer, including CSE approval, and the ability of the Company to carry out the Offer under the conditions provided. or not at all. Although the Company believes that the forward-looking statements contained in this press release are reasonable, they are based on factors and assumptions, based on currently available information, regarding future events, which may prove to be inaccurate. As such, readers are cautioned not to place undue reliance on forward-looking statements, as no assurance can be given as to future plans, operations, results, levels of activity or achievements. The forward-looking statements contained in this press release are made as of the date of this press release and, except as required by applicable law, the Company undertakes no obligation to publicly update or revise any of the statements. forward-looking, whether as a result of new information, future events or otherwise.

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