Spectral Medical Inc. Announces C$8.5 Million Bought Deal Convertible Note Financing

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TORONTO, May 09, 2024 (GLOBE NEWSWIRE) -- Spectral Medical Inc. (TSX:EDT) (the "Company" or "Spectral"), is pleased to announce that it has entered into an agreement with Paradigm Capital Inc. (the "Underwriter"), in connection with a bought deal private placement consisting of the sale of 9% convertible notes of the Company (the "Convertible Notes") at a price of US$1,000 per Convertible Note due on May 1, 2028 (the "Maturity Date") for gross proceeds of approximately C$8.5 million (the "Offering"). The holders of the Convertible Notes may convert all or any portion of the Convertible Notes into common shares of the Company (the "Common Shares") at a conversion price of C$0.52 per Common Share, subject to customary anti-dilution adjustments and in integral multiples of US$1,000 principal amount at any time prior to the Maturity Date. The Convertible Notes are convertible into approximately 16.4 million Common Shares (or approximately 18.8 million Common Shares if the over-allotment option, as described below, is exercised in full), subject to customary anti-dilution and make whole fundamental change adjustments.

The Company has granted the Underwriter an option to sell up to that number of additional Convertible Notes equal to 15% of the base size of the Offering, on the same terms and conditions as set out herein, exercisable in whole or in part at any time up to 48 hours prior to the Closing Date (as defined below).

The net proceeds from the Offering are expected to be primarily used by the Company on its Phase III registration trial (Tigris) for its PMX treatment for endotoxemic septic shock and for general corporate and working capital purposes.

The Offering is expected to close on or about May 23, 2024 (the "Closing Date") and will be subject to regulatory approvals and customary closing conditions, including listing of the common shares issuable upon conversion of the Notes on the Toronto Stock Exchange.

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 U.S. state securities laws, and may not be offered or sold in the United States without registration under the U.S. Securities Act and all applicable state securities laws or compliance with the requirements of an applicable exemption therefrom. This press release does not constitute an offer to sell or the solicitation of an offer to buy securities in the United States, nor may there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.