• $3.92 million raised from non-brokered private placement offering, and $0.58 million from insider loan
  
• Investissement Québec and insiders each invest $2.0 million
  
• Proceeds from the financing to be used to strengthen working capital and support ongoing growth

MONTREAL, Aug. 31, 2023 /CNW/ - Valeo Pharma Inc. (TSX: VPH) (OTCQB: VPHIF) (FSE:VP2) ("Valeo" or the "Company"), a Canadian pharmaceutical company, today announced the closing of a $4.5 million financing. The Company closed a non-brokered private placement offering (the "Offering") of 13,999,997 units (the "Units") of the Company at a price of $0.28 per Unit (the "Issue Price") for gross proceeds of $3.92 million, including the participation of Investissement Québec for $2.0 million and $1.421million from Insiders. In addition, the Company secured a loan agreement with a related party for a principal amount of $580,000 bearing annual interest at a rate of 12%.

"We greatly appreciate the support of Investissement Québec and our Insiders in leading this capital financing thereby continuing to demonstrate their confidence in our business plan and our growth performance", said Steve Saviuk, CEO. "This financing will strengthen our working capital position and enable us to support the market share gains of our core products in our key therapeutic areas".

"We are pleased to support Valeo Pharma in their growth strategy," stated Guy LeBlanc, President and CEO of Investissement Québec. "The life sciences industry is a key sector of our economy and we will keep supporting and assisting our entrepreneurs in achieving their goals, both in Québec and around the world."

The Company issued 13,999,997 Units at a price of $0.28 per Unit for total gross proceeds of $3,920,000. Each Unit consist of one (1) class A share of the Company (each, a "Share") and one-half (1/2) Share purchase warrant of the Company (a "Warrant"). Each full Warrant entitles the holder to purchase one (1) Share in the capital of the Company (a "Warrant Share") at the price of $0.35 per Warrant Share for a period of 60 months from the closing date of the Offering (the "Closing Date").

In the event that the daily volume weighted average trading price of the Shares over any ten (10) consecutive trading days is greater or equal to $0.70, the Company may give notice to the Warrant holder, at any time after the first 12 months following the closing, that all outstanding Warrants must be exercised within a period of 30-days from the date of receipt of the notice, failing which the Warrants will automatically expire

The Company will use the net proceeds of the Offering to fund working capital.

The Common Shares and the Warrants are subject to a statutory 4-month hold period under the applicable securities laws and in such case the certificates evidencing the Shares and the Warrants will bear a legend to that effect, as applicable.

Each subscription by a "related party" of the Company is considered to be a "related party transaction" for purposes of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The Company did not file the material change report more than 21 days before the expected closing date of the Offering as the details of the Offering and the participation therein by each "related party" of the Company were not settled until shortly prior to the closing of the Offering, and the Company wished to close the Offering on an expedited basis for sound business reasons. The Company is relying on exemptions from the formal valuation and minority shareholder approval requirements available under MI 61-101. The Company is exempt from the formal valuation requirement in section 5.4 of MI 61-101 in reliance on sections 5.5(a) and (b) of MI 61-101 as the fair market value of the transaction, insofar as it involves interested parties, is not more than the 25% of the Company's market capitalization, and no securities of the Company are listed or quoted for trading on prescribed stock exchanges or stock markets. Additionally, the Company is exempt from minority shareholder approval requirement in section 5.6 of MI 61-101 in reliance on section 5.7(b) as the fair market value of the transaction, insofar as it involves interested parties, is not more than the 25% of the Company's market capitalization. The Offering was approved by the board of directors of Valeo.

ABOUT INVESTISSEMENT QUEBEC

Investissement Quebec's mission is to play an active role in Quebec's economic development by stimulating business innovation, entrepreneurship and business acquisitions, as well as growth in investment and exports. Operating in all of the province's administrative regions, the Corporation supports the creation and growth of businesses of all sizes with investments and customized financial solutions. It also assists businesses by providing consulting services and other support measures, including technological assistance available from Investissement Québec – CRIQ. In addition, through Investissement Québec International, the Corporation prospects for talent and foreign investment, and assists Quebec businesses with export activities.

About Valeo Pharma Inc.

Valeo Pharma is a fast-growing Canadian pharmaceutical company dedicated to the commercialization of innovative prescription products in Canada with a focus on Respiratory/Allergy, Ophthalmology and Hospital Specialty Products. Headquartered in Kirkland, Quebec Valeo Pharma has all the required capabilities and the full infrastructure to register and properly manage its growing product portfolio through all stages of commercialization. For more information, please visit www.valeopharma.com and follow us on LinkedIn and Twitter.

Forward Looking Statements

This press release contains forward-looking statements about Valeo's objectives, strategies and businesses that involve risks and uncertainties. These statements are "forward-looking" because they are based on our current expectations about the markets we operate in and on various estimates and assumptions. Actual events or results may differ materially from those anticipated in these forward-looking statements if known or unknown risks affect our business, or if our estimates or assumptions turn out to be inaccurate.