Aequus Announces "Best Efforts" Public Offering

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VANCOUVER, BC, July 28, 2020 /CNW/ - Aequus Pharmaceuticals Inc. (TSXV: AQS) (OTCQB: AQSZF) ("Aequus" or the "Company"), a specialty pharmaceutical company with a focus on developing, advancing and promoting differentiated products, is pleased to announce a "best efforts" public offering led by Cormark Securities Inc. ("Cormark"), acting as agent, of units of the Company (the "Units") at a price of C$0.08 per Unit, for aggregate gross proceeds to be determined in the context of the market (the "Offering"). Each Unit shall consist of one common share of the Company and one-half of one common share purchase warrant (each whole common share purchase warrant, a "Warrant"). Each Warrant shall entitle the holder thereof to purchase one common share at an exercise price of C$0.12 for a period of thirty-six (36) months following the closing date of the Offering. The Warrants will include an acceleration provision, exercisable at the Company's option, if the Company's daily volume weighted average share price is greater than C$0.20 for ten consecutive trading days.

The Offering is expected to be conducted in each of the provinces of British Columbia, Alberta, Saskatchewan, Manitoba and Ontario pursuant to a prospectus supplement to the Company's base shelf prospectus dated September 16, 2019.

In connection with the Offering, the Company intends to enter into an agency agreement with Cormark (the "Agency Agreement"). Until such time as the Agency Agreement is entered into, Cormark is under no obligation to sell any of the Units. The Company expects to close the Offering on or about August 6, 2020, or such other date as may be mutually agreed to by the Company and Cormark. Completion of the Offering is subject to a number of customary closing conditions, including the execution of definitive documentation and receipt of any required regulatory approvals, including receipt of the approval of the TSX Venture Exchange for the listing of the common shares issuable on closing and issuable upon the exercise of the Warrants.

Aequus intends to use the net proceeds of the Offering to purchase inventory for the launch of the Evolve^® line of preservative free dry eye products, associated marketing and commercialization costs, regulatory application costs for preservative-free bimatoprost 0.03% and general corporate and working capital purposes.

Doug Janzen, Chairman and Chief Executive Officer, Ann Fehr, Chief Financial Officer, and a director of Aequus, are expected to purchase 3,125,000 Units, 125,000 Units and 625,000 Units, respectively, under the Offering. The issuance of Units to these individuals under the Offering constitutes a related-party transaction under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). These transactions are exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 pursuant to sections 5.5(a) and 5.7(1)(a) of MI 61-101 as neither the fair market value of any securities issued to, nor the consideration paid by, such individuals would exceed 25.0% of the Company's market capitalization.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States or in any other jurisdiction. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities laws and may not be offered or sold within the United States unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

About Aequus Pharmaceuticals

Aequus Pharmaceuticals Inc. (TSX-V: AQS, OTCQB: AQSZF) is a growing specialty pharmaceutical company focused on developing and commercializing high quality, differentiated products. Aequus has grown its sales and marketing efforts to include several commercial products in ophthalmology and transplant. Aequus plans to build on its Canadian commercial platform through the launch of additional products that are either created internally or brought in through an acquisition or license; remaining focused on highly specialized therapeutic areas. For further information, please visit www.aequuspharma.ca.

Forward-Looking Statements:

This release contains forward-looking statements or forward-looking information under applicable Canadian securities legislation that may not be based on historical fact. Forward-looking statements are necessarily based on estimates and assumptions made by us in light of our experience and perception of historical trends, current conditions and expected future developments, as well as the factors we believe are appropriate. Forward-looking statements in this release include but are not limited to statements relating to Aequus' intention to complete, and the terms of, the Offering, the expected closing date of the Offering, the preparation of a prospectus supplement to Aequus' base shelf prospectus dated September 16, 2019, and the intended use of the net proceeds of the Offering by Aequus. Such statements reflect our current views with respect to future events and are subject to risks and uncertainties and are necessarily based upon a number of estimates and assumptions that, while considered reasonable by Aequus, are inherently subject to significant uncertainties and contingencies. Many factors could cause our actual results, performance or achievements to be materially different from any future results, performance, or achievements that may be expressed or implied by such forward-looking statements. In making the forward-looking statements included in this release, the Company has made various material assumptions, including, but not limited to the market for Aequus' common shares and the fulfillment of the conditions to the Offering. In evaluating forward-looking statements, current and prospective shareholders should specifically consider various factors set out under the heading "Risk Factors" in the Company's Annual Information Form dated April 28, 2020, a copy of which is available on Aequus' profile on the SEDAR website at www.sedar.com, and as otherwise disclosed from time to time on Aequus' SEDAR profile. Should one or more of these risks or uncertainties, or a risk that is not currently known to us materialize, or should assumptions underlying those forward-looking statements prove incorrect, actual results may vary materially from those described herein. These forward-looking statements are made as of the date of this release and we do not intend, and do not assume any obligation, to update these forward-looking statements, except as required by applicable securities laws. Investors are cautioned that forward-looking statements are not guarantees of future performance and are inherently uncertain. Accordingly, investors are cautioned not to put undue reliance on forward-looking statements.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE Aequus Pharmaceuticals

Doug Janzen, Chairman & Chief Executive Officer or Aequus Investor Relations, Email: [email protected], Phone: [phone]