Valeo Pharma announces USD 10 million bought deal private placement of convertible debentures

The Debentures will mature on December 31, 2024 (the "Maturity Date") and will accrue interest at the rate of 12.0% per annum, payable quarterly beginning on March 31, 2022. At the holders' option, the Debentures may be converted into common shares of the Company at any time and from time to time, up to the Maturity Date, at a conversion price of $1.15 per common share. The Company will use commercially reasonable efforts to list the Debentures on the Canadian Securities Exchange (the "CSE").

Concurrently with the Offering, Investissement Québec has committed to a concurrent private placement of $10,000,000 of convertible unsecured debentures issuable on the same terms as those issuable pursuant to the Offering (the "Concurrent Private Placement"), resulting in aggregate gross proceeds from the Offering and Concurrent Private Placement of $20,000,000.

The net proceeds of the Offering and Concurrent Private Placement will be used to (i) support commercial efforts related to the recently launched products (Redesca, Enerzair, and Atectura); (ii) reimburse, at maturity, the non-convertible debentures previously issued by the Company and maturing on January 31, 2022 and July 10, 2022; (iii) for working capital and general corporate purposes; and (iv) support an upcoming TSX listing application.

The Company has granted the Underwriters an option to purchase up to an additional $1,500,000 aggregate principal amount of Debentures, exercisable at any time up to 48 hours prior to the closing of the Offering.

The Debentures and any common shares issuable upon conversion thereof will be subject to a statutory hold period lasting four months and one day following the Closing Date.

The closing of the Offering and Concurrent Private Placement is expected to occur on or about December 9, 2021 (the "Closing Date") and is subject to certain conditions, including but not limited to, the receipt of all necessary regulatory and stock exchange approvals, including the approval of the CSE.

"The Debentures will be offered and sold (i) in Canada on a private placement basis to "accredited investors" within the meaning of Regulation 45-106 respecting Prospectus Exemptions and other exempt purchasers in each province of Canada, (ii) in the United States on a private placement basis only under Regulation D, Rule 144A or other available exemptions from the registration requirements of the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), and (iii) in such other jurisdictions outside of Canada and the United States, in each case in accordance with applicable securities laws provided that no prospectus, registration statement or similar document is required to be filed in such jurisdictions and the Company does not thereafter become subject to continuous disclosure obligations in such jurisdictions," the company said in its recent release.