Biotech
Friday, January 19th, 2024 10:21 pm EDT
Key Points
Completion of Private Placement:
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- Alpha Cognition Inc. has successfully completed its brokered private placement of units, issuing a total of 16,965,762 units at a price of 22 U.S. cents per unit.
- The gross proceeds from this final closing amount to $3,732,467 (U.S.), contributing to a total of $8.45 million (U.S.) raised from the offering, including the fully subscribed 30-percent overallotment.
Details of the Private Placement:
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- Each unit comprises a common share and a warrant. The warrant allows the holder to purchase an additional common share at a price of 31 U.S. cents within a three-year period.
- Spartan Capital Securities LLC, the broker involved, received cash compensation of $342,320 (U.S.) and was issued compensation warrants along with a consulting fee of $320,000 (U.S.) and common shares based on a consulting agreement.
- Finders who facilitated investor introductions received an aggregate cash commission of $48,858 (U.S.), equivalent to 6 percent of the gross proceeds raised.
Use of Proceeds and Company Focus:
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- Alpha Cognition Inc. plans to utilize the net proceeds from the offering for research and development, general and administrative matters, and working capital.
- The company is a clinical-stage biopharmaceutical firm dedicated to developing treatments for neurodegenerative diseases, particularly Alzheimer’s disease and cognitive impairment with mild traumatic brain injury (mTBI).
- Alpha-1062, a patented chemical entity, is being developed as a new generation acetylcholinesterase inhibitor for Alzheimer’s disease, with potential benefits and minimal gastrointestinal side effects. It is also being explored for use in combination with memantine and as an intranasal formulation for mTBI-related cognitive impairment.
Alpha Cognition Inc. has completed a final closing pursuant to its previously announced brokered private placement of units of the company. Pursuant to the final closing, the company issued 16,965,762 units of the company at a price of 22 U.S. cents per unit for gross proceeds of $3,732,467 (U.S.). Each unit consists of a common share and a warrant, with each warrant entitling the holder to purchase an additional common share at a price of 31 U.S. cents for a period of three years. The gross proceeds of the offering received to date are $8.45-million (U.S.), which includes shares of the fully subscribed 30-per-cent overallotment.
In connection with the final closing, Spartan Capital Securities LLC received cash compensation of $342,320 (U.S.) and was issued 1,037,330 compensation warrants of the company, which may be exercised on the same terms as the private placement warrants. The company also paid a consulting fee of $320,000 (U.S.) and issued 14,558,285 common shares to Spartan pursuant to a consulting agreement (see the company’s news release dated May 30, 2023). The company also paid to certain finders aggregate cash commission of $48,858 (U.S.), being 6 per cent of the gross proceeds raised under the offering from investors introduced to the company by such finders.
All securities issued pursuant to the offering will be subject to a four-month statutory hold period under Canadian securities laws, and restrictions under U.S. securities laws which generally restrict resales for a period of 12 months. The company expects to use the net proceeds from the offering for research and development, general and administrative matters, and working capital.
Pursuant to Multilateral Instrument 61-101 — Protection of Minority Security Holders in Special Transactions the company advises that certain subscribers under the offering are considered to be a related party of the company. Each subscription by a related party of the company is considered to be a related party transaction for purposes of MI 61-101. The company is relying on the exemptions from the formal valuation requirements contained in Section 5.5(a) of MI 61-101 and the minority shareholder approval requirements contained in Section 5.7(1)(a) of MI 61-101, as the fair market value of the related party participation in the offering does not exceed 25 per cent of the company’s market capitalization, as determined in accordance with MI 61-101.
About Alpha Cognition Inc.
Alpha Cognition is a clinical-stage, biopharmaceutical company dedicated to developing treatments for patients suffering from neurodegenerative diseases, such as Alzheimer’s disease and cognitive impairment with mild traumatic brain injury (mTBI), for which there are currently no approved treatment options.
Alpha-1062 is a patented new chemical entity being developed as a new generation acetylcholinesterase inhibitor for the treatment of Alzheimer’s disease, with expected minimal gastrointestinal side effects. Alpha-1062’s active metabolite is differentiated from donepezil and rivastigmine in that it binds neuronal nicotinic receptors, most notably the alpha-7 subtype, which is known to have a positive effect on cognition. Alpha-1062 is also being developed in combination with memantine to treat moderate to severe Alzheimer’s dementia, and as an intranasal formulation for cognitive impairment with mTBI.
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