Item 1.01 Entry into a Material Definitive
Agreement.
On February 25, 2021, Edesa Biotech, Inc.
(the “Company”) entered into an underwriting agreement with H.C. Wainwright & Co., LLC (“Wainwright”)
(as amended and restated, the “Underwriting Agreement”). Pursuant to the Underwriting Agreement, the Company agreed
to sell, in an upsized firm commitment public offering, 1,562,500 common shares (the “Firm Shares”) of the Company
(the “Common Shares”) to Wainwright at an offering price to the public of U.S.$6.40 per share, less underwriting discounts
and commissions. In addition, pursuant to the Underwriting Agreement, the Company has granted Wainwright a 30-day option to purchase
up to an additional 234,375 Common Shares (collectively with the Firm Shares, the “Shares”) at the same offering price
to the public, less underwriting discounts and commissions. The offering is expected to close on or about March 2, 2021, subject
to customary closing conditions.
The aggregate gross proceeds of the
offering are expected to be U.S.$10.0 million, before deducting underwriting discounts and commissions and offering expenses payable
by the Company. The Company intends to use the net proceeds from the offering for general corporate purposes, which may include
working capital, capital expenditures and research and development expenses.
Wainwright is acting as the sole book-running
manager for the offering. The Company will pay Wainwright an underwriting discount equal to 7.0% of the gross proceeds of the offering
and a management fee equal to 1.0% of the gross proceeds of the offering. The Company also agreed to pay Wainwright U.S.$40,000
for non-accountable expenses, an expense allowance of up to U.S.$100,000 for legal fees and other out-of-pocket expenses and $15,950
for Wainwright’s closing expenses. The Company agreed to issue to Wainwright, or its designees, warrants (the “Underwriter
Warrants”) to purchase, in the aggregate, up to 109,375 Common Shares (equal to 7.0% of the aggregate number of Common Shares
sold under the offering, assuming no exercise of the option to purchase additional Common Shares). The Underwriter Warrants will
have a term of five years from the commencement of the sales and an exercise price of U.S.$8.00 per share, or 125% of the public
offering price.
The Shares are being offered pursuant to
the Company’s effective shelf registration statement on Form S-3, which was originally filed with the Securities and Exchange
Commission on August 30, 2019, and was declared effective on September 12, 2019 (File No. 333-233567) and the accompanying base
prospectus dated September 12, 2019.
The Underwriting Agreement contains customary
representations, warranties, and covenants of the Company and also provides for customary indemnification by each of the Company
and Wainwright against certain liabilities and customary contribution provisions in respect of those liabilities.
The foregoing descriptions of the Underwriting
Agreement and the Underwriter Warrants are not complete and are qualified in their entirety by reference to the full text of the
Underwriting Agreement and the form of Underwriter Warrant, which will be filed in an amendment to this Current Report on Form
8-K. The Company issued press releases on February 25, 2021 announcing the pricing and upsizing of the offering, which press releases
are attached here to as Exhibits 99.1 and 99.2, respectively.
Item 1.02. Termination of Material Definitive
Agreement.
On February 25, 2021, the Company provided
notice of termination of the Equity Distribution Agreement, dated as of September 28, 2020, (the “Equity Distribution Agreement”),
by and between the Company and RBC Capital Markets, LLC (“RBCCM”). The termination of the Equity Distribution Agreement
is effective as of February 25, 2021. As previously reported, pursuant to the terms of the Equity Distribution Agreement, the Company
could offer and sell Common Shares having an aggregate offering price of up to $9.2 million from time to time through RBCCM. The
Company is not subject to any termination penalties related to the termination of the Equity Distribution Agreement. The Company
sold a total of 586,463 Common Shares pursuant to the Equity Distribution Agreement for proceeds of $3,749,542 from September 28,
2020 through the date of termination of the Equity Distribution Agreement.