Algernon Pharmaceuticals Announces Launch of Rights Offering – Algernon Pharmaceuticals (OTC:AGNPF)

VANCOUVER, British Columbia, March 21, 2023 (GLOBE NEWSWIRE) — Algernon Pharmaceuticals Inc. AGN AGW AGNPF (“Company” or “Algernon”), a Canadian clinical stage pharmaceutical development company, announces that it is making a Rights Offering to raise gross proceeds of approximately $2,416,747 (the “Rights Offering”). The Company will grant 9,666,988 rights (“Rights”) to holders of its Class A common shares (“Shares”) (“Shareholders”) at the close of business on the Record Date March 29, 2023. Record Date”) on a basis of one (1) Rights for each (1) Share. Each one (1) Rights will entitle the holder to subscribe to one Unit (“Units”) at a subscription price of $0.25 per Unit.

Each Unit will consist of one Share and one Share Purchase Warrant (“Warrant”), with each Warrant exercisable for a period of 18 months following the date of issue of the Warrant at an exercise price of $0.52 per Share. the volume-weighted average price of the Shares for each of ten consecutive trading days on the Canada Securities Exchange (“CSE”) if not less than 30 days after the delivery of the acceleration notice to the holders of the warrants (acceleration) on that date from $1.04 is more. The pricing of the rights offering is mandated by applicable Canadian securities legislation and the policies of the CSE, which require the company to offer existing shareholders a significant discount to purchase new securities in order to encourage shareholders to participate in the rights offering. A meaningful incentive can be provided for. Upon completion of the Rights Offering and assuming that all rights are exercised, the Company will have 19,333,976 shares outstanding, of which the shares issued under the Rights Offering represent 50%, assuming that the Rights Offering No warrant has been issued for.

It is expected that the Rights will trade on the CSE under the symbol “AGN.RT” beginning on or around March 28, 2023, and will continue to trade on or about April 27, 2023, at 9:00 a.m. (PT). The Rights expire at 2:00 p.m. ET on April 27, 2023 (the “Expiration Date”), after which time any unexercised Rights will become void and have no value. Shareholders who have fully exercised their rights under the Basic Subscription Privilege shall be entitled to subscribe for additional units, subject to certain limits set out in the Company’s Articles of Incorporation, as a result of premature expiration of rights on the date of expiry. The Offering Circular dated March 21, 2023 (the “Circular”) will be filed on SEDAR under Algernon’s profile, along with the Notice of Rights Offering on Form 45-106F14 (the “Notice”). The notice and rights DRS advice/subscription will be sent to shareholders in the eligible jurisdiction on or about April 5, 2023 as the record date. The Company expects to close the Rights Offering on or before May 3, 2023.

The Rights will be offered to shareholders residing in all provinces and territories of Canada (“Eligible Jurisdictions”).

Shareholders registered in eligible jurisdictions who wish to exercise their rights should forward the completed subscription form together with the applicable funds to the rights agent, TSX Trust Company (“Rights Agent”), on or before expiration. date. Shareholders who own their shares through an intermediary, such as a bank, trust company, securities dealer or broker, will receive materials and instructions from their intermediary.

Subject to the detailed provisions of the circular, the rights certificate or DRS advice and subscription forms shall not be mailed to residents outside the eligible jurisdiction, unless such shareholders are able to establish to the satisfaction of the company that they participate in eligible to take. Rights Offering, and provide such evidence to the Company and the Rights Agent by April 20, 2023. After April 20, 2023, the Rights Agent will endeavor on a commercially reasonable basis to sell the rights to the disqualified shareholders. shareholders on the facilities of CSE from which the company accepts membership). The rights agent will mail checks representing the net proceeds without interest from such sale to such ineligible shareholders. The Company believes that its directors and senior officers, who own the shares, wish to exercise most of their rights to purchase units under their original subscription privilege; However, the number of powers estimated to be exercised by the directors and senior officers cannot be ascertained as of this date.

AlphaNorth Asset Management is an “insider” (as defined under applicable securities laws) and holder of more than 10% of the issued and outstanding shares of the Company that has advised the Company that it intends to exercise , subject to relevant restrictions, its original membership privilege to receive 1,268,040 units for total gross proceeds to the Company of $317,010.

The Company has also entered into an agreement with Research Capital Corporation (“RCC” or the “Soliciting Dealer”), under which RCC is to be appointed as the exclusive soliciting dealer for and on behalf of the Company on a commercially reasonable efforts basis. Has been done The RCC shall have the right, but not the obligation, to purchase up to $500,000 of Units for which subscriptions have not been received by the expiration time on the Expiration Date (“Top-up Right”). The RCC will receive a commission of five percent of the gross proceeds of the rights offer, except for those rights exercised by shareholders on the President’s List (“President’s List”), for which a commission of two percent subject to a maximum of 25% will be paid . of the gross proceeds of the rights offering. The RCC will also receive a number of soliciting dealer warrants (“Soliciting Dealer Warrants”) equal to five percent of the units subscribed under the Rights Offering, excluding units for which the President’s List The shareholders have subscribed, for which they will receive two per cent. In the solicitation of units arising out of exercise of dealer warrants and top-up rights. In addition, the soliciting dealer will receive a number of soliciting dealer warrants equal to eight per cent of the units issued under the exercise of the top-up right. Each soliciting dealer warrant entitles its holder to purchase one unit at the unit subscription price for a period of 18 months from the date of issue. The company will also pay RCC a $20,000 corporate finance fee and taxes.

The proceeds of the Rights Offering are expected to be used for working capital and general corporate purposes and administrative expenses.

The rights and underlying shares and warrants, and the shares to be issued upon exercise of the warrants, have not been registered under the United States Securities Act of 1933, as amended (the “US Securities Act”), or any US state securities law. This news release does not constitute an offer of an offer to sell or an offer to buy any securities within the United States, and the securities may not be offered or sold in the United States or for the account or profit of any person in the United States or any U.S. Person, unless registered under the US Securities Act and applicable US state securities laws, or pursuant to an exemption from such registration requirements described in the circular. There shall be no offer or sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful absent registration or qualification of such securities under the laws of any such jurisdiction. In addition, the warrants may not be exercised or for the benefit of any person in the United States of America in the absence of an exemption from the registration requirements of the US Securities Act and applicable US state securities laws. “United States” and “US person” are defined in Regulation S under the US Securities Acts.

Algernon Pharmaceuticals Inc. About this

Algernon Pharmaceuticals is a Canadian clinical stage drug development and repurposing company investigating a number of drugs for unmet global unmet medical needs. Algernon Pharmaceuticals has active research programs for IPF with chronic cough, and chronic kidney disease, and is the parent company of a newly created private subsidiary called Algernon NeuroScience, which develops proprietary forms of DMT for stroke and traumatic brain injury. leading a psychedelic program that investigates ,

contact information

Christopher J Morrow
Algernon Pharmaceuticals Inc.
604.398.4175 extension 701,

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

WARNING Disclaimer Statement: No securities exchange has reviewed and accepts responsibility for the adequacy or accuracy of the contents of this news release. This news release contains forward-looking statements relating to the Rights Offering, the closing of the Rights Offering and the use of proceeds from the Rights Offering, and other statements that are not historical facts. Forward-looking statements are often identified by words such as “will”, “may”, “should”, “anticipate”, “expect” and similar expressions. All statements other than statements of historical fact included in this release are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove accurate and actual results may differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Company’s expectations include the failure to meet the terms of the relevant securities exchange(s) and the Company’s filings with securities regulations from time to time. A wide range of other risks are involved. The reader is cautioned that the assumptions used in preparing any forward-looking information may prove to be incorrect. Actual results may differ materially due to events or circumstances resulting from a number of known and unknown risks, uncertainties and other factors, many of which are beyond the control of the Company. Readers are cautioned not to place undue reliance on any forward-looking information. Such information, although believed by management to be reasonable at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The forward-looking statements contained in this news release are made as of the date of this news release and the company will publicly update or revise any forward-looking statements included in this release as expressly required by applicable law.

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