Replies to post #221 on Aequus Pharmaceuticals (AQSZF)

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Aequus Announces Public Offering of Convertible Debenture

VANCOUVER, British Columbia, April 03, 2019 (GLOBE NEWSWIRE) -- Aequus Pharmaceuticals Inc. (the “Company”) (TSX-V: AQS) (OTCQB:AQSZF) is pleased to announce that it expects to file a preliminary prospectus supplement (the “Prospectus Supplement”) to its short form base shelf prospectus dated August 15, 2017 (the “Base Shelf Prospectus”) relating to a proposed marketed public offering of convertible debenture units of the Company (each, a “Debenture Unit”) at a price of $1,000 per Debenture Unit for gross proceeds of approximately $3 million (the “Offering”).

The indicative terms of the Offering are that each Debenture Unit will consist of a 9.5% unsecured convertible debenture (each, a “Convertible Debenture”) with a maturity of 36 months from the date of issuance (the “Maturity Date”) and an indicative amount of common share purchase warrants (each, a “Warrant”) representing 50% warrant coverage, exercisable for 36 months from the date of issuance. Each Warrant shall entitle the holder thereof to purchase one common share in the capital of the Company (each, a “Common Share” and collectively, the “Common Shares”) at an indicative exercise price equal to $0.22, to be determined in the context of the market (the “Exercise Price”), at any time up to 36 months following Closing of the Offering.

The principal amount of each Convertible Debenture (the “Principal Amount”) is expected to be convertible, for no additional consideration, into Common Shares at an indicative conversion price of $0.21 (the “Conversion Price”) at the option of the holder at any time prior to the earlier of: (i) the close of business on the Maturity Date; and (ii) the business day immediately preceding the date specified by the Company for redemption of the Convertible Debentures upon a change of control.

The Company may force the conversion of the principal amount of the then outstanding Convertible Debentures (the “Mandatory Conversion”) at the Conversion Price on not more than 60 days' and not less than 30 days' notice should the daily volume weighted average trading price of the Common Shares be greater than $0.32 for the consecutive 20 trading days preceding the notice, subject to the Mandatory Conversion being permitted under the policies of the TSX Venture Exchange (the “TSXV”).

The Offering is being led by Mackie Research Capital Corporation as the lead agent and sole bookrunner, on behalf of members of the syndicate (together, the “Agents”).

The net proceeds received by the Company from the Offering are intended to be used for regulatory applications and, launch of the recently announced Medicom products, investments in the medical cannabis space, initiation of the Trokendi clinical study, working capital and general corporate purposes.

The Company will also grant the Agents an option (the “Over-Allotment Option”) to cover over-allotments and for market stabilization purposes, exercisable at any time up to 30 days subsequent to the closing of the Offering, to increase the size of the Offering by up to 15% in Debenture Units on the same terms and conditions of the Offering, exercisable in whole or in part.

The Offering is expected to be made pursuant to a Prospectus Supplement to the Base Shelf Prospectus and otherwise by private placement exemption in those jurisdictions where the Offering can lawfully be made, including the United States and Europe.

The closing of the Offering is currently expected to be during the week of April 22, 2019 and will be subject to certain conditions including, but not limited to, the receipt of all necessary regulatory approvals including the approval of the TSXV. Until such time as an agency agreement is entered into, the Agents are under no obligation to underwrite, sell or purchase any securities of the Company or to enter into any such transaction. The Company expects to apply to list the Convertible Debentures, Warrants and common shares issuable upon conversion of the Convertible Debentures and exercise of the Warrants on the TSXV, subject to such securities meeting the listing requirements of the TSXV.