Algernon Pharmaceuticals Inc. (CSE:AGN, OTCQB:AGNPF) said it has entered into an equity distribution agreement dated December 23, 2022, with Research Capital Corp for the at-the-market (ATM) offering of its common shares.
Under the agreement, the company will be entitled, at its discretion and from time to time during the term of the distribution agreement, to sell, through Research Capital, as sole and exclusive placement agent, such number of Class A common shares of the company having an aggregate gross sales price of up to $5.0 million.
The company said it intends to use the net proceeds of the ATM offering to complete the phase 1 study of DMT in stroke, complete the phase 1 study of Repirinast for CKD, formulation and manufacturing of the finished drug product for the phase 2b study of Ifenprodil in chronic cough, and for general and administrative purposes.
READ: Algernon Pharmaceuticals says Ifenprodil granted Orphan Drug Designation by US FDA for treatment of IPF
The volume and timing of distributions under the ATM offering, if any, will be determined in the company's sole discretion. The common shares will be distributed at market prices or prices related to prevailing market prices from time to time. As a result, prices of the common shares sold under the ATM offering will vary as between purchasers and during the period of distribution.
The ATM offering will be effective until the earlier of the issuance and sale of all of the common shares issuable under the ATM offering and June 6, 2023, unless terminated prior to such date by the company or the agent in accordance with the terms of the distribution agreement.
Distributions of the common shares under the ATM offering will be made and qualified by way of a prospectus supplement dated December 23, 2022, to the company's existing Canadian short-form base shelf prospectus dated May 5, 2021.
Algernon is a Canadian clinical-stage drug development company investigating multiple drugs for unmet global medical needs. The company has active research programs for IPF with chronic cough, chronic kidney disease and a psychedelic program investigating a proprietary form of DMT for stroke.
Contact the author at jon.hopkins@proactiveinvestors.com