As
filed with the Securities and Exchange Commission on June 30, 2020
Registration
No. 333-239264
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
AMENDMENT
NO. 1 TO
FORM
F-1
REGISTRATION
STATEMENT
UNDER
THE
SECURITIES ACT OF 1933
AETERNA
ZENTARIS INC.
(Exact
name of Registrant as specified in its charter)
Not
Applicable
(Translation
of Registrant’s name into English)
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Canada
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2834
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Not
Applicable
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(State
or other jurisdiction of incorporation or organization)
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|
(Primary
Standard Industrial
Classification
Code Number)
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|
(I.R.S.
Employer
Identification Number)
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315
Sigma Drive
Summerville,
South Carolina 29486
(843)
900-3223
(Address,
including zip code, and telephone number, including area code, of Registrant’s principal executive offices)
Klaus
Paulini, PhD
President
and Chief Executive Officer
Aeterna
Zentaris Inc.,
315
Sigma Drive
Summerville,
South Carolina 29486
(843)
900-3211
(Name,
address, including zip code, and telephone number, including area code, of agent for service)
Copies
to:
|
Brian
Pukier, Esq.
Jeff
Hershenfield, Esq.
Stikeman
Elliott LLP
5300
Commerce Court West
199
Bay Street
Toronto,
Ontario
Canada,
M5L 1B9
(416)
869-5205
|
|
Michael
J. Lerner, Esq.
Steven
M. Skolnick, Esq.
Lowenstein
Sandler LLP
1251
Avenue of the Americas
New
York, NY 10020
United
States
(212)
262-6700
|
|
Rick
A. Werner, Esq.
Jayun
Koo, Esq.
Haynes
and Boone, LLP
30
Rockefeller Plaza,
26th
Floor
New
York New York 10112
Tel:
(212) 659-7300
|
Approximate
date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.
If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, check the following box. [X]
If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please
check the following box and list the Securities Act registration statement number of the earlier effective registration statement
for the same offering. [ ]
If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]
If
this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.
Emerging
growth company [ ]
If
an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the
registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards†
provided pursuant to Section 7(a)(2)(B) of the Securities Act. [ ]
†
The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards
Board to its Accounting Standards Codification after April 5, 2012.
CALCULATION
OF REGISTRATION FEE
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Title of Each Class of Securities to be Registered
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Proposed Maximum
Aggregate Offering
Price(1)(2)(3)
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Amount of
Registration
Fee
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Units consisting of:(4)
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$
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12,000,000
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$
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1,557.60
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(i) Common Shares, no par value per share (“Common Shares”), included in the Units(5)
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-
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-
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(ii) Common Warrants to purchase Common Shares included in the Units(5)
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-
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|
|
-
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Pre-Funded Units consisting of:(4)
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$
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12,000,000
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$
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1,557.60
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(i) Common Warrants to purchase Common Shares included in the Pre-Funded Units(5)
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-
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-
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(ii) Pre-Funded Warrants to purchase Common Shares included in the Pre-Funded Units(5)
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|
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-
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-
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Common Shares underlying the Common Warrants included in the Units and the Pre-Funded Units(4)
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$
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12,000,000
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$
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1,557.60
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Common Shares underlying the Pre-Funded Warrants included in the Pre-Funded Units(4)(5)
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-
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-
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Placement Agent Warrants to purchase Common Shares(6)
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$
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1,050,000
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$
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136.29
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Common Shares underlying the Placement Agent Warrants(6)(7)
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-
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-
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Total
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$
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37,050,000
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$
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4,809.09
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(8)
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(1)
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Estimated
solely for the purpose of calculating the amount of the registration fee pursuant to Rule 457(o) under the Securities Act
of 1933, as amended.
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(2)
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Pursuant
to Rule 416 under the Securities Act of 1933, as amended, this registration statement also registers such indeterminate number
of shares that may become issuable as a result of stock splits, stock dividends, recapitalizations or similar transactions.
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(3)
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All
Common Shares of the registrant carry rights to purchase additional Common Shares pursuant to the Shareholder Rights Plan
Agreement between the registrant and Computershare Trust Company of Canada. Such purchase rights are attached to and trade
with the Common Shares. The value, if any, attributable to the purchase rights is reflected in the value of the Common Shares.
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(4)
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The
proposed maximum aggregate offering price of the Units proposed to be sold in the offering will be reduced on a dollar-for-dollar
basis based on the aggregate offering price of any Pre-Funded Units offered and sold in the offering, and the proposed maximum
aggregate offering price of the Pre-Funded Units to be sold in the offering will be reduced on a dollar-for-dollar basis based
on the aggregate offering price of any Units sold in the offering. Accordingly, the proposed maximum aggregate offering price
of the Units and Pre-Funded Units (including the Common Shares issuable upon exercise of the Pre-Funded Warrants included
in the Pre-Funded Units), if any, is $12,000,000.
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(5)
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No
additional registration fee is payable pursuant to Rule 457(i) under the Securities Act of 1933, as amended.
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(6)
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Represents
warrants to purchase a number of Common Shares equal to 7.0% of the number of Common Shares sold in this offering (including
the number of Common Shares underlying the Pre-Funded Warrants) at an exercise price equal to 125% of the offering price per
Unit.
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(7)
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No
additional registration fee is payable pursuant to Rule 457(g) under the Securities Act of 1933, as amended.
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(8)
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Previously paid.
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The
Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until
the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become
effective in accordance with Section 8(a) of the Securities Act or until this registration statement shall become effective on
such date as the Securities and Exchange Commission, acting pursuant to Section 8(a) of the Securities Act, may determine.
The
information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement
filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is
not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
SUBJECT
TO COMPLETION, DATED JUNE 30, 2020
PRELIMINARY
PROSPECTUS
Up
to 14,457,831 Units
(each Unit consists of one Common Share
and one Common Warrant to purchase one Common Share)
Up to 14,457,831 Pre-Funded Units
(each Pre-Funded Unit consists of one Pre-Funded Warrant to purchase one Common Share and one Common Warrant to one Common
Share)
Common Shares underlying the Pre-Funded Warrants
Common Shares underlying the Common Warrants
We are offering up to
14,457,831 units, or the “Units”, with each Unit consisting of (i) one common share, no par value per share
(“Common Shares”), of Aeterna Zentaris Inc. (“Aeterna Zentaris”, “we”, “us” or
the “Company”), and (ii) one warrant to purchase one Common Share, or a “Common Warrant.” The Common
Warrants will have an exercise price of $_________ per share, will be exercisable at any time after the date of issuance and will
expire five years from the date of issuance. Each Unit will be sold at a negotiated price of $_________ per Unit. Each
Common Share (including Common Shares included in the Units and/or underlying the Pre-Funded Warrants and Common Warrants) offered
under this prospectus has associated with it one right to purchase a Common Share under our Rights Plan (as defined herein). Please
see the section entitled “Description of Securities We are Offering” in this prospectus for a more detailed discussion.
We
are also offering to those purchasers, if any, whose purchase of Units in this offering would result in the purchaser, together
with its affiliates and certain related parties, beneficially owning more than 4.99% (or, at the election of the purchaser, 9.99%)
of our outstanding Common Shares immediately following the consummation of this offering, the opportunity to purchase, in lieu
of Units that would otherwise result in ownership in excess of 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding
Common Shares, pre-funded units, or the “Pre-Funded Units”, with each Pre-Funded Unit consisting of (i) a pre-funded
warrant to purchase one Common Share, or a “Pre-Funded Warrant,” and (ii) one Common Warrant. Because we will issue
a Common Warrant as part of each Unit or Pre-Funded Unit, the number of Common Warrants sold in this offering will not change
as a result of a change in the mix of the Units and Pre-Funded Units sold. Each Pre-Funded Warrant contained in a Pre-Funded Unit
will be exercisable for one Common Share. The purchase price of each Pre-Funded Unit will equal the price per Unit being sold
to the public in this offering, minus $0.0001, and the exercise price of each Pre-Funded Warrant included in the Pre-Funded Unit
will be $0.0001 per share. The Pre-Funded Warrants will be immediately exercisable and may be exercised at any time until exercised
in full.
For
each Pre-Funded Unit we sell, the number of Units we are offering will be decreased on a one-for-one basis. Units and the Pre-Funded
Units will not be issued or certificated. The Common Shares or Pre-Funded Warrants, as the case may be, and the Common Warrants
included in the Units or the Pre-Funded Units, can only be purchased together in this offering, but the securities contained in
the Units or Pre-Funded Units will be issued separately and will be immediately separable upon issuance.
The
Common Shares issuable from time to time upon exercise of the Common Warrants and the Pre-Funded Warrants are also being offered
by this prospectus. We refer to the Common Shares issued or issuable upon exercise of the Common Warrants and Pre-Funded Warrants,
and the Common Shares, the Common Warrants and Pre-Funded Warrants being offered hereby, collectively, as the “securities.”
Our Common Shares
are listed on both the NASDAQ Capital Market (“NASDAQ”) and on the Toronto Stock Exchange (“TSX”) under
the symbol “AEZS”. On June 29, 2020, the last reported sales price of our Common Shares on NASDAQ was $0.84
per share and on TSX was C$1.16 per share.
There is no established
public trading market for the Common Warrants or the Pre-Funded Warrants, and we do not expect a market to develop. In addition,
we do not intend to apply for a listing of the Common Warrants or the Pre-Funded Warrants on any national securities exchange or
other nationally recognized trading system. Without an active trading market, the liquidity of the Common Warrants or the Pre-Funded
Warrants will be limited.
We have assumed a public
offering price of $0.83 per Unit, the last reported sale price for our Common Shares as reported on NASDAQ on June 26,
2020, and $0.8299 per Pre-Funded Unit. The public offering price per Unit or Pre-Funded Unit, as the case may be, will
be determined through negotiation between us and the investors in the offering and may be at a discount to the current market
price. Therefore, the recent market price used as the assumed public offering price throughout this prospectus may not be indicative
of the offering price.
NEITHER
THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR
PASSED UPON THE ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
Investing
in our securities involves a high degree of risk. Before making any decision to invest in our securities, you should carefully
consider the information disclosed under “Risk Factors” beginning on page 5 of this Prospectus, as well as
those risk factors contained or incorporated by reference into this Prospectus.
The
securities offered by this prospectus have not been qualified in Canada and may not be offered or sold in Canada except
pursuant to a Canadian prospectus or an exemption from the prospectus requirements under applicable Canadian
securities laws. The Company has not filed and does not intend to file a Canadian prospectus in connection with the
securities offered by this prospectus.
The
Company has applied to the TSX for conditional approval for listing of the Common Shares offered for sale pursuant to this prospectus
(including the Common Shares underlying the Pre-Funded Warrants, the Common Shares underlying the Common Warrants and the Common
Shares underlying the Placement Agent Warrants). Listing on the TSX is subject to us fulfilling all of the requirements of the
TSX.
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Per
Unit
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Per
Pre-
funded
Unit
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Total
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Public offering price
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$
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$
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$
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Placement agent fees(1)
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$
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$
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$
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Proceeds to us (before
expenses)(2)
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$
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$
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$
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(1)
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We
have agreed to pay the placement agent a cash fee and a management fee, equal to 7.25% and 1.0%, respectively, of the gross
proceeds raised in this offering, and to reimburse the placement agent for certain of its offering-related expenses. In addition,
we have agreed to issue the placement agent or its designees warrants to purchase a number of Common Shares equal to 7.0%
of the aggregate number of Common Shares sold in this offering (including the number of Common Shares issuable upon exercise
of the Pre-Funded Warrants), at an exercise price of $_____ per share, which represents 125% of the public offering price
per Unit. See “Plan of Distribution” for a description of the compensation to be received by the placement agent.
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(2)
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Does
not include proceeds from the exercise of the Common Warrants or the Pre-Funded Warrants in cash, if any.
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We
have engaged H.C. Wainwright & Co., LLC (“Wainwright” or the “placement agent”) to act as our exclusive
placement agent in connection with this offering. The placement agent is not purchasing or selling the securities offered by us,
and is not required to sell any specific number or dollar amount of securities, but will use its reasonable best efforts to arrange
for the sale of the securities offered by this prospectus. There are no minimum purchase requirements. Because there is
no minimum offering amount required as a condition to closing in this offering, the actual public offering amount, placement agent
fees, and proceeds to us, if any, are not presently determinable and may be substantially less than the total maximum offering
amounts set forth above. In either event, this offering may be closed without further notice to you.
Because there is no
minimum offering amount required as a condition to closing this offering, we may sell fewer than all of the securities offered
hereby, which may significantly reduce the amount of proceeds received by us, and investors in this offering will not receive
a refund in the event that we do not sell an amount of securities sufficient to pursue the business goals outlined in this prospectus.
In addition, because there is no escrow account and no minimum offering amount in this offering, investors could be in a position
where they have invested in our company, but we are unable to fulfill our objectives due to a lack of interest in this offering.
Also, any proceeds from the sale of securities offered by us will be available for our immediate use, despite uncertainty about
whether we would be able to use such funds to effectively implement our business plan. See “Risk Factors” for more
information. The offering will be terminated by October 10, 2020, provided that the closing of the offering has not occurred by such
date, and may not be extended.
Delivery
of the securities is expected to be made on or about_________, 2020, subject to customary closing conditions.
H.C.
Wainwright & Co.
The
date of this Prospectus is , 2020
TABLE
OF CONTENTS
ABOUT
THIS PROSPECTUS
This
prospectus is part of a registration statement on Form F-1 that we filed with the SEC under the Securities Act of 1933, as amended,
or the Securities Act. This prospectus does not contain all of the information included in the registration statement. For further
information, we refer you to the registration statement, including its exhibits, filed with the SEC. Statements contained in this
prospectus about the contents of any document are not necessarily complete. If SEC rules require that a document be filed as an
exhibit to the registration statement, please see such document for a complete description of these matters. You should carefully
read this prospectus, together with the additional information described under the headings “Where You Can Find More Information”
and “Incorporation of Certain Documents by Reference.”
This
prospectus does not constitute an offer to sell, or a solicitation of an offer to purchase, the securities offered by this prospectus
in any jurisdiction where it is unlawful to make such offer or solicitation. Before purchasing any securities, you should carefully
read this prospectus, together with the additional information described under the headings, “Incorporation of Certain Documents
by Reference,” and “Where You Can Find Additional Information” in this prospectus. We have not authorized anyone
to provide information different from that contained in this prospectus, any amendment or supplement to this prospectus or in
any free writing prospectus prepared by us or on our behalf. When you make a decision about whether to invest in our securities,
you should not rely upon any information other than the information in this prospectus and any free writing prospectus prepared
by us or on our behalf. This prospectus is not an offer to sell or solicitation of an offer to buy the securities being offered
hereby in any circumstances under which the offer or solicitation is unlawful.
For
investors outside of the United States: We have not done anything that would permit this offering or possession or distribution
of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. You are required
to inform yourselves about and to observe any restrictions relating to this offering and the distribution of this prospectus.
You
should rely only on the information contained or incorporated by reference in this prospectus. Neither we nor the placement agent
have authorized anyone to provide you with different information. If anyone provides you with different or inconsistent information,
you should not rely on it. You should assume that the information contained in this prospectus and the documents incorporated
by reference herein is accurate only as of their respective dates. Our business, financial condition, results of operations and
prospects may have changed since those dates. If any statement in this prospectus is inconsistent with a statement in another
document having a later date—for example, a document incorporated by reference into this prospectus—the statement
in the document having the later date modifies or supersedes the earlier statement.
The
financial statements included in or incorporated by reference into this prospectus have been prepared in accordance with International
Financial Reporting Standards as issued by the International Accounting Standards Board. Our consolidated financial statements
are subject to the standards of the Public Company Accounting Oversight Board (United States) and the SEC independence standards,
and thus may not be comparable to financial statements of United States (“U.S.”) companies.
Unless
otherwise stated, currency amounts in this prospectus are stated in United States dollars, or “$” or “US$”.
All references to “C$” are to Canadian dollars.
In
this prospectus, unless otherwise indicated, references to “we”, “us”, “our”, “Aeterna
Zentaris” or the “Company” are to Aeterna Zentaris Inc., a Canadian corporation, and its consolidated subsidiaries,
unless it is clear that such terms refer only to Aeterna Zentaris Inc. excluding its subsidiaries.
PROSPECTUS
SUMMARY
This
summary highlights selected information about us, this offering and information contained in greater detail elsewhere in this
prospectus and in the documents incorporated by reference herein. This summary is not complete and does not contain all of the
information that you should consider before investing in our securities. You should carefully read and consider this entire prospectus
and the documents, including financial statements and related notes, and information incorporated by reference into this prospectus,
including the financial statements and “Risk Factors” in this prospectus, before making an investment decision. If
you invest in our securities, you are assuming a high degree of risk.
Our
Company
Aeterna
Zentaris is a specialty biopharmaceutical company commercializing and developing therapeutics and diagnostic tests. The Company’s
lead product, Macrilen™ (macimorelin), is the first and only United States Food and Drug Administration (“FDA”)
and European Commission approved oral test indicated for the diagnosis of patients with adult growth hormone deficiency (“AGHD”).
Macrilen™ (macimorelin) is currently marketed in the United States through a license and assignment agreement (the “License
Agreement”) with Novo Nordisk A/S (“Novo”). Aeterna Zentaris is also pursuing the development of macimorelin
for the diagnosis of child-onset growth hormone deficiency (“CGHD”), an area of significant unmet need. In addition,
we are actively pursuing business development opportunities for the commercialization of macimorelin in Europe and the rest of
the world in addition to other non-strategic assets to monetize their value.
Recent
Developments
Nasdaq
Letters
On
each of January 8, 2020 and April 8, 2020, we received a letter from the Listing Qualifications Staff of the NASDAQ, notifying
us that for the last 30 consecutive business days prior to the date of the letter, the closing bid price of our Common Shares
was below $1.00 per share and, therefore, we did not meet the requirement for continued listing on the NASDAQ as required by Nasdaq
Listing Rule 5550(a)(2). On each of January 23, 2020 and on June 5, 2020, we received a letter from the Listing Qualifications
Staff of the NASDAQ notifying us that we had regained compliance with the minimum bid price requirement. As of the date of this
prospectus, our share price has been below $1.00 since June 11, 2020 and there
can be no assurance that we will regain compliance with the minimum bid price requirement for continued listing.
In
addition to the minimum bid price requirement, the continued listing rules of the NASDAQ require us to meet at least one of the
following listing standards: (i) stockholders’ equity of at least $2.5 million, (ii) market value of listed securities (calculated
by multiplying the daily closing bid price of our securities by our total outstanding securities) of at least $35 million or (iii)
net income from continuing operations (in the latest fiscal year or in two of the last three fiscal years) of at least $500,000.
On
April 8, 2020, we received a letter from the Listing Qualifications Staff of the NASDAQ,
notifying us that, based upon the net loss for the fiscal year ended December 31, 2019, the Company no longer satisfies the minimum
net income requirement for continued listing on The Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(3) and does not otherwise
satisfy the alternative requirements of market value of listed securities or stockholders’ equity. The Company timely submitted
a plan to regain compliance with Nasdaq Listing Rule 5550(b)(3), and on June 3, 2020 the Staff granted the Company an extension
of 180 days, through October 5, 2020, to evidence compliance with this requirement. The Company is pursuing a number of
initiatives to increase stockholders’ equity, the completion of which are expected to enable it to achieve compliance with
the minimum stockholders’ equity requirement by no later than October 5, 2020 and to thereafter maintain compliance with
the listing requirements. However, there is no assurance that we will obtain and then maintain compliance and therefore there
can be no assurance that our Common Shares will remain listed on the NASDAQ.
Pediatric
clinical trial for Macrilen™ (macimorelin)
On January 28, 2020, we announced the successful
completion of patient recruitment for the first pediatric study of macimorelin as a growth hormone stimulation test for the evaluation
of growth hormone deficiency (“GHD”) in children. This study, AEZS-130-P01 (“Study P01”), was the first
of two studies as agreed with the European Medicines Agency (“EMA”) in our pediatric investigation plan (“PIP”) for macimorelin
as a GHD diagnostic. Macimorelin, a ghrelin agonist, is an orally active small molecule that stimulates the secretion of growth
hormone from the pituitary gland into the circulatory system. The goal of Study P01 was to establish a dose that can both be safely
administered to pediatric patients and cause a clear rise in growth hormone concentration in subjects ultimately diagnosed as
not having GHD. The recommended dose derived from Study P01 will be evaluated in the pivotal second study AEZS-130-P02 (“Study P02”)
on diagnostic efficacy and safety. Study P01 was an international, multicenter study which was conducted in Hungary, Poland, Ukraine,
Serbia, Belarus and Russia. Study P01 was an open label, group comparison, dose escalation trial designed to investigate the safety,
tolerability, and pharmacokinetic/pharmacodynamic (“PK/PD”) of macimorelin acetate after ascending single oral doses
of macimorelin at 0.25, 0.5, and 1.0 mg per kg body weight in pediatric patients from 2 to less than 18 years of age with suspected
GHD. We enrolled a total of 24 pediatric patients across the three cohorts of the study. Per study protocol, all enrolled patients
completed four study visits after successful completion of the screening period. At Visit 1 and Visit 3, a provocative GH stimulation
test was conducted according to the study sites’ local practices. At Visit 2, the macimorelin test was performed: following
the oral administration of the macimorelin solution, blood samples were taken at predefined times for PK/PD assessment. Visit
4 was a safety follow-up visit at study end.
The final study results form Study P01
were published in the second quarter of 2020. Thereafter, we plan to proceed with the pivotal Study P02 with an expected
start date in the first quarter of 2021 and an expected completion date in July 2022, according to the PIP agreement with
EMA. Study P02 is designed to investigate the diagnostic efficacy and safety of macimorelin acetate in pediatric patients
from 2 years of age to 18 years of age with suspected growth hormone deficiency.
On April 7, 2020 we announced the decision
of the EMA to accept a modification request by us of our PIP as originally approved in March 2017, which covered the conduct of
two pediatric studies and defined relevant key elements in the outline of these studies. We believe this EMA decision supports
the development of one globally harmonized study protocol for test validation, Study P02, which we expect to be accepted
both in Europe and the U.S.
Megapharm Distribution Agreement
On June 25, 2020, we announced that we
entered into an exclusive distribution and related quality agreement with Megapharm Ltd. (“Megapharm”), a leading
Israel-based biopharmaceutical company, for the commercialization in Israel and the Palestinian Authority of macimorelin, to be
used in the diagnosis of patients with AGHD and in clinical development for the diagnosis of CGHD.
Under the terms of the agreement, Megapharm
will be responsible for obtaining registration to market macimorelin in Israel and the Palestinian Authority, while we will be
responsible for manufacturing, product supply, quality assurance and control, regulatory support, and maintenance of the relevant
intellectual property. The regulatory process for macimorelin in Israel is expected to be completed in the second half of 2021.
Corporate
Information
We
were incorporated on September 12, 1990 under the Canada Business Corporations Act (the “CBCA”) and continue to be
governed by the CBCA. Our registered address is located at 5300 Commerce Court West, 199 Bay Street, Toronto, Ontario, Canada
M5L 1B9 c/o Stikeman Elliott, LLP. Our principal executive offices are located at 315 Sigma Drive, Summerville, South Carolina
29486; our telephone number is (843) 900-3223 and our website is www.zentaris.com. None of the documents or information found
on our website shall be deemed to be included in or incorporated by reference into this prospectus, unless such document is specifically
incorporated herein by reference. The SEC also maintains a website at www.sec.gov that contains reports, proxy statements and
other information regarding registrants that file electronically with the SEC.
We
currently have three wholly owned direct and indirect subsidiaries, Aeterna Zentaris GmbH (“AEZS Germany”), based
in Frankfurt am Main, Germany, Zentaris IVF GmbH, a direct wholly owned subsidiary of AEZS Germany, based in Frankfurt am Main,
Germany, and Aeterna Zentaris, Inc., an entity incorporated in the State of Delaware with an office based in Summerville, South
Carolina in the U.S.
THE
OFFERING
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Units
offered by us
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14,457,831
Units, each consisting
of (i) one Common Share and (ii) one Common Warrant to purchase one Common Share.
The Units will not be certificated, and the Common Share and Common Warrant comprising
each Unit are immediately separable and will be issued separately in this offering.
This
prospectus also relates to the offering of Common Shares issuable upon the exercise of the Common Warrants included in
the Units.
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Pre-Funded
Units offered by us
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We
are also offering to those purchasers, if any, whose purchase of Units in this offering
would result in the purchaser, together with its affiliates and certain related parties,
beneficially owning more than 4.99% (or, at the election of the purchaser, 9.99%) of
our outstanding Common Shares immediately following the consummation of this offering,
the opportunity to purchase, in lieu of Units that would otherwise result in ownership
in excess of 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding Common
Shares, Pre-Funded Units. The purchase price of each Pre-Funded Unit will equal the public
offering price at which the Units are being sold to the public in this offering, minus
$0.0001, and the exercise price of each Pre-Funded Warrant included in each Pre-Funded
Unit will be $0.0001 per Common Share. For each Pre-Funded Unit we sell, the number of
Units we are offering will be decreased on a one-for-one basis. Because we will issue
a Common Warrant as part of each Unit or Pre-Funded Unit, the number of Common Warrants
sold in this offering will not change as a result of a change in the mix of the Units
and Pre-Funded Units sold.
Each
Pre-Funded Unit will consist of (i) one Pre-Funded Warrant to purchase one Common Share and (ii) one Common Warrant to
purchase one Common Share. The Pre-Funded Units will not be certificated and the Pre-Funded Warrants and the Common
Warrants comprising each Pre-Funded Unit are immediately separable and will be issued separately in this offering.
This
prospectus also relates to the offering of Common Shares issuable upon exercise of the Pre-Funded Warrants and the Common
Warrants included in the Pre-Funded Units.
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The
Common Shares
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Each
Common Share (including Common Shares included in the Units and/or underlying the Pre-Funded Warrants and Common Warrants)
offered under this prospectus has associated with it one right to purchase a Common Share under our Rights Plan (as defined
herein). Please see the section entitled “Description of Securities We are Offering” in this prospectus for a
more detailed discussion.
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Common
Warrants
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Each
Common Warrant will have an exercise price of $_________ per Common Share, will be exercisable
at any time after the date of issuance and will expire on the fifth anniversary
of the date of issuance. To better understand the terms of the Common Warrants, you should
carefully read the “Description of Securities We are Offering” section of
this prospectus.
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Pre-Funded
Warrants
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Each
Pre-Funded Warrant will have an exercise price of $0.0001 per Common Share and will be exercisable any time after the date
of issuance and may be exercised at any time until exercised in full. To better understand the terms of the Pre-Funded Warrants,
you should carefully read the “Description of Securities We are Offering” section of this prospectus.
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Offering
Price
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The
offering price is $_________ per Unit and $__________ per Pre-Funded Unit.
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Total
Common Shares outstanding immediately after this offering
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38,041,902
Common Shares, assuming that the maximum number of Units
offered by this prospectus is sold in this offering and no sale of any Pre-Funded Units and assuming none of the Common Warrants
or Placement Agent Warrants (as defined below) issued in this offering are exercised.
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Use
of Proceeds
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We
intend to use the net proceeds of this offering for general corporate purposes, which
includes, among other purposes, the funding of a pediatric clinical trial in the E.U.
and U.S. for Macrilen™ (macimorelin), the investigation of further therapeutic
uses of macimorelin and the expansion of pipeline development activities.
See
“Use of Proceeds” for additional information.
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NASDAQ
Capital Market and TSX symbol
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AEZS
The
Common Warrants or the Pre-Funded Warrants being issued as part of the Units or the Pre-Funded Units, as applicable, are
not listed on any securities exchange and we do not intend to list the Common Warrants or Pre-Funded Warrant on NASDAQ,
TSX or any other national securities exchange or any other recognized trading system, and we do not expect a market to
develop for the Common Warrants or the Pre-Funded Warrants. Without a trading market, the liquidity of the Common Warrants
or the Pre-Funded Warrants will be limited.
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Risk
factors
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Before
deciding to invest in our securities, you should carefully consider the risks related to our business, this offering and our
securities. See “Risk Factors” on page 5 of this prospectus.
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Dividend
Policy
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We
have never declared or paid any cash dividends on our Common Shares. We do not anticipate paying any cash dividends in the
foreseeable future.
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The
number of Common Shares to be outstanding after this offering is based on 23,584,071 Common Shares outstanding as of June 26,
2020 and excludes:
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8,508,174
Common Shares issuable upon the exercise of outstanding warrants at a weighted average exercise price of $3.00 per share;
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499,410
Common Shares issuable upon the exercise of outstanding stock options and deferred share units at a weighted average exercise
price of $1.67 per share;
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1,942,555
Common Shares reserved for future issuance under our 2018 Long-Term Incentive Plan dated March 27, 2018;
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246,619
Common Shares reserved for future issuance under our Second Amended and Restated Stock Option Plan adopted by our Board of
Directors on March 29, 2016, and ratified by the shareholders on May 10, 2016;
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14,457,831
Common Shares issuable upon the exercise of Common Warrants
to be issued to investors in this offering at an exercise price of $_________ per share;
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Up
to 14,457,831 Common Shares issuable upon the exercise of
Pre-Funded Warrants to be issued to investors in this offering at an exercise price of $0.0001 per share; and
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1,012,048
Common Shares issuable upon the exercise of the warrants
to purchase Common Shares to be issued to the placement agent in connection with this offering (the “Placement Agent
Warrants”) at an exercise price of $_________ per share.
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Unless
otherwise stated, outstanding share information throughout this prospectus excludes such outstanding securities. Except as otherwise
indicated, all information in this prospectus assumes no sale of Pre-Funded Units in this offering, which, if sold, would reduce
the number of Units that we are offering on a one-for-one basis and no exercise of the Placement Agent Warrants.
RISK
FACTORS
Investing
in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks
described below in this prospectus and in any of our filings with the SEC, including the item captioned “Risk Factors”
in our most recent Annual Report on Form 20-F and subsequent consolidated financial statements and corresponding management’s
discussion and analysis filed with the Canadian securities regulatory authorities and our Reports on Form 6-K furnished to the
SEC including our unaudited interim consolidated financial statements and corresponding management’s discussion and analysis.
For additional information, please see the sources described in “Where You Can Find More Information.”
These
risks are not the only risks we face. Additional risks not presently known to us, or that we currently view as immaterial, may
also impair our business, if any of the risks described in our SEC filings or any additional risks actually occur, our business,
financial condition, results of operations and cash flows could be materially and adversely affected. In that case, the value
of our securities could decline substantially and you could lose all or part of your investment.
Risks
Relating to Us and Our Business
Our
Common Shares may be delisted from the NASDAQ or the TSX, which could affect their market price and liquidity. If our Common Shares
were to be delisted, investors may have difficulty in disposing their Common Shares.
Our
Common Shares are currently listed on both the NASDAQ and the TSX under the symbol “AEZS”. We must meet continuing
listing requirements to maintain the listing of our Common Shares on the NASDAQ and the TSX. For continued listing, the NASDAQ
requires, among other things, that listed securities maintain a minimum closing bid price of not less than $1.00 per share. On
each of January 8, 2020 and April 8, 2020, we received a letter from the Listing Qualifications Staff of the NASDAQ, notifying
us that for the last 30 consecutive business days prior to the date of the letter, the closing bid price of our Common Shares
was below $1.00 per share and, therefore, we did not meet the requirement for continued listing on the NASDAQ as required by Nasdaq
Listing Rule 5550(a)(2). On each of January 23, 2020 and on June 5, 2020, we received a letter from the Listing Qualifications
Staff of the NASDAQ notifying us that we had regained compliance with the minimum bid price requirement. As of the date of this
prospectus, our share price has been below $1.00 since June 11, 2020 and there can be no assurance that we will regain
compliance with the minimum bid price requirement for continued listing.
In
addition to the minimum bid price requirement, the continued listing rules of the NASDAQ require us to meet at least one of the
following listing standards: (i) stockholders’ equity of at least $2.5 million, (ii) market value of listed securities (calculated
by multiplying the daily closing bid price of our securities by our total outstanding securities) of at least $35 million or (iii)
net income from continuing operations (in the latest fiscal year or in two of the last three fiscal years) of at least $500,000
(collectively, the “Additional Listing Standards”). If we fail to meet at least one of the Additional Listing Standards,
our Common Shares may be subject to delisting after the expiration of the period of time, if any, that we are allowed for regaining
compliance.
On
April 8, 2020, we received a letter from the Listing Qualifications Staff of the NASDAQ,
notifying us that, based upon the net loss for the fiscal year ended December 31, 2019, the Company no longer satisfies the minimum
net income requirement for continued listing on The Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(3) and does not otherwise
satisfy the alternative requirements of market value of listed securities or stockholders’ equity. The Company timely submitted
a plan to regain compliance with Nasdaq Listing Rule 5550(b)(3), and on June 3, 2020 the Staff granted the Company an extension
of 180 days, through October 5, 2020, to evidence compliance with this requirement. The Company is pursuing a number of
initiatives to increase stockholders’ equity, including, among other things, this offering and the registration of the common
shares underlying certain share purchase warrants, such registration was effective on June 16, 2020, the completion of which are
expected to enable it to achieve compliance with the minimum stockholders’ equity requirement by no later than October 5,
2020 and to thereafter maintain compliance with the listing requirements. However, there is no assurance that we will obtain and
then maintain compliance and therefore there can be no assurance that our Common Shares will remain listed on the NASDAQ or the
TSX. If we fail to meet any of the NASDAQ’s or the TSX’s continued listing requirements, our Common Shares may be
delisted. Any delisting of our Common Shares may adversely affect our ability to raise additional financing through the public
or private sale of equity securities, would significantly adversely affect the ability of investors to trade our securities and
would negatively affect the value and liquidity of our Common Shares. Delisting could also have other negative results, including
the potential loss of confidence by employees, the loss of institutional investor interest and fewer business opportunities. If
our Common Shares are delisted by the NASDAQ or the TSX, the price of our Common Shares may decline, and a shareholder may find
it more difficult to dispose, or obtain quotations as to the market value, of such shares. Moreover, if we are delisted, we could
incur additional costs under state blue sky laws in connection with any sales of our securities. These requirements could severely
limit the market liquidity of our Common Shares and the ability of our shareholders to sell our Common Shares in the secondary
market.
It
is possible that we may be a passive foreign investment company, which could result in adverse tax consequences to U.S. investors.
Adverse
U.S. federal income tax rules apply to “U.S. Holders” (as defined in “Income Tax Considerations - Material U.S.
Federal Income Tax Considerations” in this prospectus) who directly or indirectly hold stock of a passive foreign investment
company (“PFIC”). We will be classified as a PFIC for U.S. federal income tax purposes for a taxable year if (i) at
least 75% of our gross income is “passive income” or (ii) at least 50% of the average value of our assets, including
goodwill (based on annual quarterly average), is attributable to assets which produce passive income or are held for the production
of passive income.
The
determination of whether we are, or will be, a PFIC for a taxable year depends, in part, on the application of complex U.S. federal
income tax rules, which are subject to various interpretations. Although the matter is not free from doubt, we believe that we
were not a PFIC during our 2019 taxable year and will not likely be a PFIC during our 2020 taxable year. Because PFIC status is
based on our income, assets and activities for the entire taxable year, and our market capitalization, it is not possible to determine
whether we will be characterized as a PFIC for the 2020 taxable year until after the close of the taxable year. The tests for
determining PFIC status are subject to a number of uncertainties. These tests are applied annually, and it is difficult to accurately
predict future income, assets and activities relevant to this determination. In addition, because the market price of our Common
Shares is likely to fluctuate, the market price may affect the determination of whether we will be considered a PFIC. There can
be no assurance that we will not be considered a PFIC for any taxable year (including our 2020 taxable year).
If
we are a PFIC for any taxable year during which a U.S. Holder holds Common Shares, we generally would continue to be treated as
a PFIC with respect to that U.S. Holder for all succeeding years during which the U.S. Holder holds such Common Shares, even if
we ceased to meet the threshold requirements for PFIC status. Accordingly, no assurance can be given that we will not constitute
a PFIC in the current (or any future) tax year or that the Internal Revenue Service (the “IRS”) will not challenge
any determination made by us concerning our PFIC status. PFIC characterization could result in adverse U.S. federal income tax
consequences to U.S. Holders. In particular, absent certain elections, a U.S. Holder would generally be subject to U.S. federal
income tax at ordinary income tax rates, plus a possible interest charge, in respect of a gain derived from a disposition of our
Common Shares, as well as certain distributions by us. If we are treated as a PFIC for any taxable year, a U.S. Holder may be
able to make an election to “mark-to-market” Common Shares each taxable year and recognize ordinary income pursuant
to such election based upon increases in the value of the Common Shares. A mark-to-market election will be unavailable with respect
to our Common Warrants and is not expected to be available with respect to the Pre-Funded Warrants, which are not likely to be
treated as regularly traded on a qualified exchange.
In
addition, U.S. Holders may mitigate the adverse tax consequences of the PFIC rules by making a “qualified electing fund”
(“QEF”) election; however, there can be no assurance that we will satisfy the record keeping requirements applicable
to a QEF or that we will provide the information regarding our income that would be necessary for a U.S. Holder to make a QEF
election.
If
the Company is a PFIC, U.S. Holders will generally be required to file an annual information return with the IRS (on IRS Form
8621, which PFIC shareholders will be required to file with their U.S. federal income tax or information returns) relating to
their ownership of Common Shares. This filing requirement is in addition to any pre-existing reporting requirements that apply
to a U.S. Holder’s interest in a PFIC (which this requirement does not affect).
For
a more detailed discussion of the potential tax impact of us being a PFIC, please see “Income Tax Considerations - Material
U.S. Federal Income Tax Considerations” in this prospectus supplement and the accompanying prospectus. The PFIC rules are
complex. U.S. Holders should consult their tax advisors regarding the potential application of the PFIC regime and any reporting
obligations to which they may be subject under that regime.
Our
net operating losses may be limited for U.S. federal income tax purposes under Section 382 of the Internal Revenue Code.
If
a corporation with net operating losses (“NOLs”) undergoes an “ownership change” within the meaning of
Section 382 of the United States Internal Revenue Code of 1986, as amended, then such corporation’s use of such “pre-change”
NOLs to offset income incurred following such ownership change may be limited. Such limitation also may apply to certain losses
or deductions that are “built-in” (i.e., attributable to periods prior to the ownership change, but not yet taken
into account for tax purposes) as of the date of the ownership change that are subsequently recognized. An ownership change generally
occurs when there is either (i) a shift in ownership involving one or more “5% shareholders,” or (ii) an “equity
structure shift” and, as a result, the percentage of stock of the corporation owned by one or more 5% shareholders (based
on value) has increased by more than 50 percentage points over the lowest percentage of stock of the corporation owned by such
shareholders during the “testing period” (generally the 3 years preceding the testing date). In general, if such change
occurs, the corporation’s ability to utilize its net operating loss carry-forwards and certain other tax attributes would
be subject to an annual limitation, as described below. The unused portion of any such net operating loss carry-forwards or tax
attributes each year is carried forward, subject to the same limitation in future years. The impact of an ownership change on
state NOL carryforwards may vary from state to state. Due to previous ownership changes, or if we undergo an ownership change
in connection with or after this offering, our ability to use our NOLs could be limited by Section 382 of the Code. Future changes
in our stock ownership, some of which are outside of our control, could result in an ownership change under Sections 382 of the
Code. Recent legislation added several limitations to the ability to claim deductions for NOLs in future years, particularly for
tax years beginning after December 31, 2020, including a deduction limit equal to 80% of taxable income and a restriction on NOL
carryback deductions. For these reasons, we may not be able to use a material portion of the NOLs, even if we attain profitability.
Risks
related to the offering
Our
management team will have immediate and broad discretion over the use of the net proceeds from this offering and may not use them
effectively.
We
currently intend to use the net proceeds of this offering for general corporate purposes, which includes, among other purposes,
the funding of a pediatric clinical trial in the E.U. and U.S. for Macrilen™ (macimorelin), the investigation of further
therapeutic uses of macimorelin and the expansion of pipeline development activities. See “Use of Proceeds.” However,
our management will have broad discretion in the application of the net proceeds. Our shareholders may not agree with the manner
in which our management chooses to allocate the net proceeds from this offering. The failure by our management to apply these
funds effectively could have a material adverse effect on our business, financial condition and results of operation. Pending
their use, we may invest the net proceeds from this offering in a manner that does not produce income. The decisions made by our
management may not result in positive returns on your investment and you will not have an opportunity to evaluate the economic,
financial or other information upon which our management bases its decisions.
Because
the offering is being conducted on a “best efforts” basis, we may not raise the maximum proceeds set forth in this
prospectus, and even if we do, we will need additional capital in the future. If additional capital is not available, we may not
be able to continue to operate our business pursuant to our business plan or we may have to discontinue our operations entirely.
The
placement agent in this offering will offer the securities on a “best-efforts” basis with no minimum, meaning that
we may raise substantially less than the total maximum offering amount. As a “best efforts” offering, there can be
no assurance that the offering contemplated hereby will ultimately be consummated. If the offering is not consummated or we receive
less than the maximum proceeds, our business could be harmed.
We
have incurred, and expect to continue to incur, substantial expenses in our efforts to develop Macrilen™ (macimorelin).
Consequently, we have incurred operating losses and negative cash flow from operations historically and in each of the last several
years except for the year ended December 31, 2018, when we earned revenue from the sale of a license for the adult indication
of Macrilen™ (macimorelin) in the U.S. and Canada. There can be no assurance that the Company will be able to execute license
or purchase agreements or to obtain equity or debt financing, or on terms acceptable to it. Factors within and outside the Company’s
control could have a significant bearing on its ability to obtain additional financing.
Because there is no minimum required
for the offering to close, investors in this offering will not receive a refund in the event that we do not sell an amount of
securities sufficient to pursue the business goals outlined in this prospectus.
We have not specified a minimum offering
amount nor have or will we establish an escrow account in connection with this offering. Because there is no escrow account and
no minimum offering amount, investors could be in a position where they have invested in our company, but we are unable to fulfill
our objectives due to a lack of interest in this offering. Further, because there is no escrow account in operation and no minimum
investment amount, any proceeds from the sale of securities offered by us will be available for our immediate use, despite uncertainty
about whether we would be able to use such funds to effectively implement our business plan. Investor funds will not be returned
under any circumstances whether during or after the offering.
You
may experience immediate and substantial dilution in the net tangible book value of the Common Shares you purchase in this offering.
The
assumed offering price of the Common Shares underlying the Units and the Pre-Funded Units offered pursuant to this prospectus
is substantially higher than the net tangible book value per Common Share. Therefore, if you purchase Units or the Pre-Funded
Units in this offering, you will incur immediate and substantial dilution in the pro forma net tangible book value per Common
Share from the price per unit that you pay for the underlying Common Share. If the holders of outstanding options or warrants
exercise those options or warrants at prices below the assumed offering price, you will incur further dilution. See the section
entitled “Dilution” below for a more detailed discussion of the dilution you will incur if you purchase securities
in this offering.
There
is no public market for the warrants being offered in this offering.
There
is no established public trading market for the warrants being offered in this offering, and we do not expect a market to develop.
In addition, we do not intend to apply to list any of the warrants on any securities exchange or nationally recognized trading
system, including NASDAQ. Without an active market, the liquidity of the warrants will be limited.
Holders
of the warrants purchased in this offering will have no rights as Common Share-holders until such holders exercise such warrants
and acquire our Common Shares.
Until
holders of warrants purchased in this offering acquire our Common Shares upon exercise thereof, holders of such warrants will
have no rights with respect to the shares of our Common Shares underlying such warrants. Upon exercise of any of the warrants
purchased in this offering, such holders will be entitled to exercise the rights of a Common Share-holder only as to matters for
which the record date occurs after the exercise date.
The
Common Warrants and the Placement Agent Warrants are speculative in nature.
The Common Warrants being sold in this offering
have an exercise price of $________ per Common Share and the Placement Agent Warrants have an exercise price of $______ per Common
Share. The Common Warrants will expire on the fifth anniversary from the issuance date, and the Placement Agent Warrants
will expire on the fifth anniversary from the effective date of this offering. In the event our Common Share price does
not exceed the per share exercise price of the Common Warrants or the Placement Agent Warrants during the period when such warrants
are exercisable, such warrants will not have any value.
Prevention
of Transactions Involving a Change of Control of the Company
Effective
May 8, 2019, the shareholders re-approved the Company’s Rights Plan (as defined herein) that provides the Board of
Directors and the Company’s shareholders with additional time to assess any unsolicited take-over bid for the Company
and, where appropriate, to pursue other alternatives for maximizing shareholder value. Under the Rights Plan, one right has been
issued for each currently issued common share, and one right will be issued with each additional common share that may be issued
from time to time. The Rights Plan may have a significant anti-takeover effect. The Rights Plan has the potential to significantly
dilute the ownership interests of an acquiror of shares of the Company, and therefore may have the effect of delaying, deterring
or preventing a change in control of the Company.
SPECIAL
NOTE ON FORWARD-LOOKING STATEMENTS
This
Prospectus and the documents incorporated herein by reference contain forward-looking statements made pursuant to the safe-harbor
provision of the U.S. Securities Litigation Reform Act of 1995, which reflect our current expectations regarding future events.
Forward-looking statements may include, but are not limited to statements preceded by, followed by, or that include the words
“will,” “expects,” “believes,” “intends,” “would,” “could,”
“may,” “anticipates,” and similar terms that relate to future events, performance, or our results. Forward-looking
statements involve known risks and uncertainties, including those discussed in the Annual Report on Form 20-F, under the caption
“Key Information - Risk Factors” filed with the relevant Canadian securities regulatory authorities in lieu of an
annual information form and with the SEC. Known and unknown risks and uncertainties could cause our actual results to differ materially
from those in forward-looking statements. Such risks include but are not limited to:
●
our ability to raise capital and obtain financing to continue our currently planned operations;
●
our ability to regain compliance with the continued listing requirements of the NASDAQ and to maintain listing of our Common Shares
on the NASDAQ;
●
our ability to continue as a going concern, which is dependent, in part, on our ability to transfer cash from Aeterna Zentaris
GmbH (“AEZS Germany”) to Aeterna Zentaris and the U.S. subsidiary and to secure additional financing;
●
our now heavy dependence on the success of Macrilen™ (macimorelin) and related out-licensing arrangements and the continued
availability of funds and resources to successfully commercialize the product, including our heavy reliance on the success of
the license and assignment agreement with Novo Nordisk A/S (“Novo”);
●
our ability to enter into out-licensing, development, manufacturing, marketing and distribution agreements with other pharmaceutical
companies and keep such agreements in effect;
●
our reliance on third parties for the manufacturing and commercialization of Macrilen™ (macimorelin);
●
potential disputes with third parties, leading to delays in or termination of the manufacturing, development, out-licensing
or commercialization of our product candidates, or resulting in significant litigation or arbitration;
●
uncertainties related to the regulatory process;
●
unforeseen global instability, including the instability due to the global pandemic of the novel coronavirus;
●
our ability to efficiently commercialize or out-license Macrilen™ (macimorelin);
●
our reliance on the success of the pediatric clinical trial in the European Union (“E.U.”) and U.S. for Macrilen™
(macimorelin);
●
the degree of market acceptance of Macrilen™ (macimorelin);
●
our ability to obtain necessary approvals from the relevant regulatory authorities to enable us to use the desired brand names
for our product;
●
our ability to successfully negotiate pricing and reimbursement in key markets in the E.U. for Macrilen™ (macimorelin);
●
any evaluation of potential strategic alternatives to maximize potential future growth and shareholder value may not result
in any such alternative being pursued, and even if pursued, may not result in the anticipated benefits;
●
our ability to protect our intellectual property; and
●
the potential of liability arising from shareholder lawsuits and general changes in economic conditions.
More
detailed information about these and other factors is included under “Risk Factors” in this Prospectus and in other
documents incorporated herein by reference. Investors should consult the Company’s quarterly and annual filings with the
Canadian and U.S. securities commissions for additional information on risks and uncertainties. Many of these factors are beyond
our control. Future events may vary substantially from what we currently foresee. You should not place undue reliance on such
forward-looking statements. The Company disavows and is under no obligation to update or alter such forward-looking statements
whether as a result of new information, future results, events, developments or otherwise, unless required to do so by a governmental
authority or applicable law.
USE
OF PROCEEDS
We estimate that our net proceeds from this
offering will be approximately $9.9 million, based on the sale of the maximum amount of 14,457,831 Units in this
offering at an assumed public offering price of $0.83 per Unit (the last reported sale price of our Common Shares on NASDAQ
on June 26, 2020) after deducting the placement agent fees and estimated offering expenses payable by us. However, this
is a best efforts offering with no minimum, and we may not sell all or any of the securities we are offering. As a result, we
may receive significantly less in net proceeds.
If
a holder of Common Warrants elects to exercise the Common Warrants issued in this offering, we may also receive proceeds from
the exercise of the Common Warrants. We cannot predict when or if the Common Warrants will be exercised. It is possible that the
Common Warrants may expire and may never be exercised.
Each $0.25 increase or decrease in the assumed
public offering price of $0.83 per Unit would increase or decrease, respectively, our net proceeds by approximately
$3.3 million, assuming the maximum number of Units offered by us, as set forth on the cover page of this prospectus, remains
the same and after deducting placement agent fees and estimated offering expenses payable by us. We may also increase or decrease
the number of Units we are offering. An increase or decrease of 1,000,000 in the number of Units we are offering would increase
or decrease, respectively, the net proceeds from this offering, after deducting placement agent fees and estimated offering expenses
payable by us, by approximately $0.8 million, assuming the assumed public offering price stays the same.
We
intend to use the net proceeds of this offering for general corporate purposes, which includes, among other purposes, the funding
of a pediatric clinical trial in the E.U. and U.S. for Macrilen™ (macimorelin), the investigation of further therapeutic
uses of macimorelin and the expansion of pipeline development activities.
Our
expected use of net proceeds from the offering represents our current intentions based upon our present plans and business condition.
Investors are cautioned, however, that expenditures may vary substantially from these uses. Investors will be relying on the judgment
of our management, who will have broad discretion regarding the application of the proceeds of this offering. The amounts and
timing of our actual expenditures will depend upon numerous factors, including the amount of cash generated by our operations,
the amount of competition and other operational factors. We may find it necessary or advisable to use portions of the proceeds
from this offering for other purposes.
DIVIDEND
POLICY
We
have never declared nor paid dividends on our securities. We currently expect to retain future earnings, if any, for use in the
operation and expansion of our business and do not anticipate paying any cash dividends in the foreseeable future. Any future
determination to pay dividends on our securities is subject to the discretion of our Board of Directors and will depend upon various
factors, including, without limitation, our results of operations and financial condition.
CONSOLIDATED
CAPITALIZATION
The
following table presents the number of our issued and outstanding Common Shares and our consolidated cash and cash equivalents
and capitalization as at March 31, 2020:
|
|
●
|
on an actual basis; and
|
|
|
|
|
|
|
●
|
on
an as adjusted basis to give effect to the sale by us of the maximum amount of 14,457,831 Units in this offering at
an assumed public offering price of $0.83 per Unit, which is the last reported sale price of our Common Shares on NASDAQ
on June 26, 2020, and no sale of Pre-Funded Units, after deducting placement agent fees and estimated offering expenses
payable by us. As at March 31, 2020, we had no outstanding long-term third-party debt.
|
The
information below has been derived from and should be read in conjunction with, and is qualified in its entirety by, our unaudited
consolidated financial statements as at March 31, 2020, and for the three-month periods ended March 31, 2020 and 2019, and the
Management’s Discussion and Analysis thereon, incorporated by reference into this prospectus supplement. Figures are in
thousands of U.S. dollars except share data.
|
|
|
As at March 31, 2020
|
|
|
|
|
Actual
|
|
|
As Adjusted
|
|
|
Number of Common Shares issued and outstanding
|
|
|
23,472,771
|
|
|
|
37,930,602
|
|
|
Cash and cash equivalents
|
|
$
|
9,182
|
|
|
$
|
19,066
|
|
|
Shareholders’ equity:
|
|
|
|
|
|
|
|
|
|
Share capital
|
|
$
|
226,413
|
|
|
$
|
236,297
|
|
|
Other capital
|
|
$
|
89,694
|
|
|
$
|
89,694
|
|
|
Deficit
|
|
$
|
(314,724
|
)
|
|
$
|
(314,724
|
)
|
|
Accumulated other comprehensive income
|
|
$
|
304
|
|
|
$
|
304
|
|
|
Total shareholders’ equity and total capitalization
|
|
$
|
1,687
|
|
|
$
|
11,571
|
|
A $0.25 increase or decrease in the assumed
public offering price of $0.83 per Unit, which is the last reported sale price of our Common Shares on the Nasdaq Capital
Market on June 26, 2020 , would increase or decrease, as appropriate, our as adjusted cash and cash equivalents, share capital
and total shareholders’ equity and total capitalization by approximately $3.3 million, assuming the maximum number
of Units offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting placement agent
fees and estimated offering expenses payable by us. Similarly, a 1,000,000 increase or decrease in the number of Units offered
by us, based on the assumed public offering price of $0.83 per Unit, would increase or decrease, as appropriate, our as
adjusted cash and cash equivalents, share capital and total shareholders’ equity and total capitalization by approximately
$0.8 million, after deducting placement agent fees and estimated offering expenses payable by us.
|
|
The
number of our Common Shares that will be outstanding both before and immediately after this offering is based on 23,472,771
shares outstanding as of March 31, 2020, and excludes as of such date:
|
|
|
●
|
9,453,174
Common Shares issuable upon the exercise of outstanding warrants at a weighted average exercise price of $3.17 per share;
|
|
|
●
|
545,357
Common Shares issuable upon the exercise of outstanding stock options and deferred share units at a weighted average exercise
price of $4.79 per share;
|
|
|
●
|
1,883,919
Common Shares reserved for future issuance under our 2018 Long-Term Incentive Plan dated March 27, 2018;
|
|
|
|
|
|
|
●
|
246,619
Common Shares reserved for future issuance under our Second Amended and Restated Stock Option Plan adopted by our Board of
Directors on March 29, 2016, and ratified by the shareholders on May 10, 2016;
|
|
|
|
|
|
|
●
|
14,457,831
Common Shares issuable upon the exercise of Common Warrants
to be issued to investors in this offering at an exercise price of $_________ per share;
|
|
|
|
|
|
|
●
|
Up
to 14,457,831 Common Shares issuable upon the exercise of
Pre-Funded Warrants to be issued to investors in this offering at an exercise price of $0.0001 per share; and
|
|
|
|
|
|
|
●
|
1,012,048
Common Shares issuable upon the exercise of the Placement
Agent Warrants to be issued to the placement agent at an exercise price of $_________ per share.
|
DILUTION
If
you invest in our Common Shares and warrants, your interest will be diluted immediately to the extent of the difference between
the public offering price per unit and the as-adjusted net tangible book value per Common Share after this offering.
The
net tangible book value (deficit) of our Common Shares as of March 31, 2020 was approximately $(6.2) million, or approximately
$(0.27) per Common Share. Net tangible book value per share represents the amount of our total tangible assets less total liabilities
divided by the total number of our Common Shares outstanding as of March 31, 2020.
After giving effect
to the sale of the maximum amount of 14,457,831 Units in this offering at the assumed public offering price of $0.83
per Unit, which is the last reported sale price of our Common Shares on NASDAQ on June 26, 2020, and no sale of any
Pre-Funded Units and after deducting the placement agent fees and estimated offering expenses payable by us in connection with
this offering, our as adjusted net tangible book value as of March 31, 2020 would have been approximately $3.7 million,
or approximately $0.10 per Common Share. This calculation assumes that none of the Common Warrants issued in this offering
are exercised and excludes the proceeds, if any, from the exercise of Common Warrants. This represents an immediate increase in
net tangible book value of approximately $0.37 per Common Share to our existing security holders and an immediate dilution
in as-adjusted net tangible book value of approximately $0.73 per Common Share to purchasers of units in this offering,
as illustrated by the following table:
|
Assumed public offering
price per Unit
|
|
|
|
|
|
$
|
0.83
|
|
|
Consolidated net tangible book value per Common Share as of March
31, 2020
|
|
$
|
(0.27
|
)
|
|
|
|
|
|
Increase in consolidated
net tangible book value per Common Share attributable to the offering
|
|
$
|
0.37
|
|
|
|
|
|
|
As adjusted consolidated
net tangible book value per Common Share after this offering
|
|
|
|
|
|
$
|
0.10
|
|
|
Dilution per
Common Share to new investors participating in this offering
|
|
|
|
|
|
$
|
0.73
|
|
The information discussed
above is illustrative only, and the dilution information following this offering will depend on the actual public offering price
and other terms of this offering determined at pricing. Each $0.25 increase or decrease in the assumed public offering price of
$0.83 per Unit, based on the last reported sale price for our Common Shares on NASDAQ on June 26, 2020, would increase
or decrease the as adjusted net tangible book value per Common Share after this offering by $0.09 per Common Share and
the dilution per share to investors participating in this offering by $0.09 per Common Share, assuming that the maximum
number of Units offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting placement
agent fees and estimated offering expenses payable by us and excluding the proceeds, if any, from exercise of the Common Warrants
issued in this offering.
We may also increase
or decrease the number of Units we are offering. An increase of 1,000,000 in the number of Units offered by us would increase
or decrease our as adjusted net tangible book value per Common Share by approximately $0.02, and decrease or increase
the dilution per Common Share to investors participating in this offering by $0.02 after deducting placement agent
fees and estimated offering expenses payable by us and excluding the proceeds, if any, from exercise of the Common Warrants issued
in this offering.
The
number of Common Shares to be outstanding after this offering is based on 23,472,771 shares outstanding as of March 31, 2020,
and excludes as of such date:
|
|
●
|
9,453,174
Common Shares issuable upon the exercise of outstanding warrants at a weighted average exercise price of $3.17 per share;
|
|
|
|
|
|
|
●
|
545,357
Common Shares issuable upon the exercise of outstanding options at a weighted average exercise price of $4.79 per share;
|
|
|
|
|
|
|
●
|
1,883,919
Common Shares reserved for future issuance under our 2018 Long-Term Incentive Plan dated March 27, 2018;
|
|
|
|
|
|
|
●
|
246,619
Common Shares reserved for future issuance under our Second Amended and Restated Stock Option Plan adopted by our Board of
Directors on March 29, 2016, and ratified by the shareholders on May 10, 2016;
|
|
|
|
|
|
|
●
|
14,457,831
Common Shares issuable upon the exercise of Common Warrants
to be issued to investors in this offering at an exercise price of $_________ per share;
|
|
|
|
|
|
|
●
|
Up
to 14,457,831 Common Shares issuable upon the exercise of
Pre-Funded Warrants to be issued to investors in this offering at an exercise price of $0.0001 per share; and
|
|
|
|
|
|
|
●
|
1,012,048
Common Shares issuable upon the exercise of the Placement
Agent Warrants to be issued to the placement agent at an exercise price of $_________ per share.
|
DESCRIPTION
OF SHARE CAPITAL
Our
authorized share capital structure consists of an unlimited number of shares of the following classes (all classes are without
nominal or par value): Common Shares; and first preferred shares (the “First Preferred Shares”) and second preferred
shares (the “Second Preferred Shares” and, together with the First Preferred Shares, the “Preferred Shares”),
each issuable in series. As of June 26, 2020, there were 23,584,071 Common Shares issued and outstanding, which have associated
Common Share purchase rights under our Shareholder Rights Plan Agreement. No Preferred Shares have been issued to date.
Common
Shares
The
holders of the Common Shares are entitled to one vote for each Common Share held by them at all meetings of shareholders, except
meetings at which only shareholders of a specified class of shares are entitled to vote. In addition, the holders are entitled
to receive dividends if, and when, declared by the Board of Directors on the Common Shares. Finally, the holders of the Common
Shares are entitled to receive the remaining property of the Company upon any liquidation, dissolution or winding-up of the affairs
of the Company, whether voluntary or involuntary. Shareholders have no liability to further capital calls as all issued and outstanding
shares are fully paid and non-assessable. Additional information on our share capital is provided in “Item 10 - Additional
Information” in our Annual Report on Form 20-F for the financial year ended December 31, 2019, incorporated by reference
to this prospectus.
Shareholder
Rights Plan
The
Board of Directors approved a shareholder rights plan of the Company on March 29, 2016, which was approved, ratified and confirmed
by the shareholders at the annual and special meeting of shareholders of the Company on May 10, 2016 (the “2016 Rights Plan”).
The 2016 Rights Plan was implemented to ensure, to the extent possible, that all of our shareholders are treated fairly in connection
with any take-over bid or other acquisition of control of the Company.
The
Board of Directors reviewed the terms of the 2016 Rights Plan for conformity with current Canadian securities laws, as well as
the evolving practices of public corporations in Canada, with respect to shareholder rights plan design and made some minor amendments
thereto as a result.
The
Board of Directors determined it appropriate and in the best interests of the shareholders to continue the 2016 Rights Plan and
approved the amended and restated shareholder rights plan (the “Rights Plan”) on March 26, 2019. The Rights Plan took
effect immediately upon receipt of approval of the shareholders of the Company at the annual and special meeting of shareholders
held on May 8, 2019.
The
fundamental objectives of the Rights Plan are to provide adequate time for our Board of Directors and shareholders to assess an
unsolicited take-over bid for us, to provide the Board of Directors with sufficient time to explore and develop alternatives for
maximizing shareholder value if a take-over bid is made, and to provide shareholders with an equal opportunity to participate
in a take-over bid. The Rights Plan encourages a potential acquirer who makes a take-over bid to proceed either by way of a “Permitted
Bid,” which requires a take-over bid to satisfy certain minimum standards designed to promote fairness, or with the concurrence
of our Board of Directors. If a takeover bid fails to meet these minimum standards and the Rights Plan is not waived by the Board
of Directors, the Rights Plan provides that holders of Common Shares, other than the acquirer, will be able to purchase additional
Common Shares at a significant discount to market, thus exposing the person acquiring Common Shares to substantial dilution of
its holdings.
Pursuant
to the terms of the Rights Plan, one right was issued in respect of each common share outstanding at 5:01 p.m. on March 29, 2016
(the “Record Time”). In addition, we will issue one right for each additional Common Share issued after the Record
Time and prior to the earlier of the Separation Time (as defined in the Rights Plan) and the Expiration Time (as defined in the
Rights Plan). The rights have an initial exercise price equal to the Market Price (as defined in the Rights Plan) of the Common
Shares as determined at the Separation Time, multiplied by five, subject to certain anti-dilution adjustments (the “Exercise
Price”), and they are not exercisable until the Separation Time. Upon the occurrence of a Flip-in Event (as defined in the
Rights Plan), each right will entitle the holder thereof, other than an Acquiring Person (as defined in the Rights Plan) or any
other person whose rights are or become void pursuant to the provisions of the Rights Plan, to purchase from us, effective at
the close of business on the eighth trading day after the Stock Acquisition Date (as defined in the Rights Plan), upon payment
to us of the Exercise Price, Common Shares having an aggregate Market Price equal to twice the Exercise Price on the date of consummation
or occurrence of such Flip-in Event, subject to certain anti-dilution adjustments.
The
Rights Plan is described in detail in “Item 10 - Additional Information” in our Annual Report on Form 20-F for the
financial year ended December 31, 2019, incorporated by reference to this prospectus.
Listing
Our
Common Shares are listed on the NASDAQ Capital Market and on the TSX under the symbol “AEZS”.
Transfer
Agent and Registrar
The
transfer agent and registrar for our Common Shares (and associated Common Share purchase rights) is Computershare Trust Company
of Canada, 1500 University Street, 7th Floor, Montreal, Quebec, H3A 358.
DESCRIPTION
OF SECURITIES WE ARE OFFERING
We are offering up to 14,457,831 Units,
with each unit consisting of one Common Share and one Common Warrant to purchase one Common Share. The Common Shares and
accompanying Common Warrants part of the Units will be issued separately. We are also registering the Common Shares issuable from
time to time upon exercise of the Common Warrants part of the Units offered hereby. Each Common Share (including Common Shares
included in the Units and/or underlying the Pre-Funded Warrants and Common Warrants) offered under this prospectus has associated
with it one right to purchase a Common Share under our Rights Plan.
We are also offering to those purchasers,
if any, whose purchase of Units in this offering would result in the purchaser, together with its affiliates and certain related
parties, beneficially owning more than 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding Common Shares immediately
following the consummation of this offering, the opportunity to purchase, in lieu of Units that would otherwise result in ownership
in excess of 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding Common Shares, Pre-Funded Units. The purchase
price of each Pre-Funded Unit will equal the public offering price at which the Units are being sold to the public in this offering,
minus $0.0001, and the exercise price of each Pre-Funded Warrant included in each Pre-Funded Unit will be $0.0001 per Common Share.
Each Pre-Funded Unit will consist of one Pre-Funded Warrant to purchase one Common Share and one Common Warrant to purchase one
Common Share. The Common Warrants and the Pre-Funded Warrants included in the Pre-Funded Units will be issued separately.
We are also registering the Common Shares issuable from time to time upon exercise of the Common Warrants and the Pre-Funded Warrants
included in the Pre-Funded Units offered hereby. The material terms and provisions of our Common Shares (and associated Common
Share purchase rights) and each other class of our securities that qualifies or limits our Common Shares are described in the
section entitled “Description of Share Capital” beginning on page 13 of this prospectus.
Common
Warrants
The
following summary of certain terms and provisions of the Common Warrants that are being offered hereby is not complete and is
subject to, and qualified in its entirety by, the provisions of the Common Warrants, the form of which is or shall be filed as
an exhibit to the registration statement of which this prospectus forms a part. Prospective investors should carefully review
the terms and provisions of the form of Common Warrant for a complete description of the terms and conditions of the Common Warrants.
Duration
and Exercise Price
Each
Common Warrant offered hereby will have an initial exercise price per share equal to $ per Common Share. The Common Warrants will
be immediately exercisable and will expire on the fifth anniversary of the original issuance date. The exercise price and
number of Common Shares issuable upon exercise is subject to appropriate adjustment in the event of stock dividends, stock splits,
reorganizations or similar events affecting our Common Shares and the exercise price. In addition, we may, with the consent of
the Common Warrant holders, reduce the then current exercise price with respect to the Common Warrants to any amount and for any
period of time deemed appropriate by our board of directors. The Common Warrants will be issued separately from the accompanying
Common Shares and/or Pre-Funded Warrants, as applicable, and may be transferred separately immediately thereafter.
Exercisability
The
Common Warrants will be exercisable, at the option of each holder, in whole or in part, by delivering a duly executed exercise
notice accompanied by payment in full for the number of Common Shares purchased upon such exercise (except in the case of a cashless
exercise as discussed below). Subject to certain limitations and exceptions, a holder (together with its affiliates) may not exercise
any portion of a Common Warrant to the extent that the holder would beneficially own more than 4.99% (or, at the election of
the purchaser, 9.99%) of the outstanding Common Shares immediately after exercise of such Common Warrant, except that upon
at least 61 days’ prior notice from the holder to us, the holder may increase the amount of ownership of outstanding stock
after exercising the holder’s Common Warrants up to 9.99% of the number of Common Shares outstanding immediately after
giving effect to the exercise. Purchasers of Common Warrants in this offering may also elect prior to the issuance of the
Common Warrants to have the initial exercise limitation set at 9.99% of our outstanding Common Shares. No fractional Common Shares
will be issued in connection with the exercise of a Common Warrant. In lieu of fractional Common Shares, we will pay the holder
an amount in cash equal to the fractional amount multiplied by the exercise price.
Cashless
Exercise
If,
at the time a holder exercises the Common Warrant, a registration statement registering the issuance of the Common Shares underlying
the Common Warrants under the Securities Act is not then effective or available, then in lieu of making the cash payment otherwise
contemplated to be made to us upon such exercise in payment of the aggregate exercise price, the holder may elect instead to receive
upon such exercise (either in whole or in part) the net number of Common Shares determined according to a formula set forth in
the Common Warrants.
Fundamental
Transaction
If,
at any time while the Common Warrants are outstanding, (1) we, directly or indirectly, consolidate or merge with or into another
person, (2) we, directly or indirectly, sell, lease, license, assign, transfer, convey or otherwise dispose of all or substantially
all of our assets, (3) any direct or indirect purchase offer, tender offer or exchange offer (whether by us or another person)
is completed pursuant to which holders of our Common Shares are permitted to sell, tender or exchange their Common Shares for
other securities, cash or property and has been accepted by the holders of 50% or more of our outstanding shares of Common Shares,
(4) we, directly or indirectly, effect any reclassification, reorganization or recapitalization of our Common Shares or any compulsory
share exchange pursuant to which our Common Shares are converted into or exchanged for other securities, cash or property, or
(5) we, directly or indirectly, consummate a stock or share purchase agreement or other business combination with another person
whereby such other person acquires more than 50% of our outstanding Common Shares, each, a “Fundamental Transaction”,
then upon any subsequent exercise of the Common Warrants, the holders thereof will have the right to receive the same amount and
kind of securities, cash or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction
if it had been, immediately prior to such Fundamental Transaction, the holder of the number of Common Shares then issuable upon
exercise of the Common Warrant, and any additional consideration payable as part of the Fundamental Transaction. In certain
circumstances, upon a fundamental transaction, the holder will have the right to require us or a successor entity to repurchase
its Common Warrants at the Black Scholes option pricing formula value; provided, however, that if the fundamental transaction
is not within the Company’s control, including not approved by the Company’s board of directors, then the holder shall
only be entitled to receive the same type or form of consideration (and in the same proportion), at the Black Scholes value of
the unexercised portion of the Common Warrant, that is being offered and paid to the holders of our Common Shares in connection
with the fundamental transaction.
Transferability
Subject
to applicable laws, a Common Warrant may be transferred at the option of the holder upon surrender of the Common Warrant together
with the appropriate instruments of transfer.
Exchange
Listing
There
is no trading market available for the Common Warrants on any securities exchange or nationally recognized trading system. We
do not intend to list the Common Warrants on any securities exchange or nationally recognized trading system, nor do we have any
obligation to do so.
Rights
as a Shareholder
Except
as otherwise provided in the Common Warrants or by virtue of such holder’s ownership of Common Shares, a holder of Common
Warrants does not have rights or privileges of a holder of Common Shares, including any voting rights or dividends, until the
holder exercises the Common Warrants.
Pre-Funded
Warrants
The
following summary of certain terms and provisions of the Pre-Funded Warrants that are being offered hereby is not complete and
is subject to, and qualified in its entirety by, the provisions of the Pre-Funded Warrants, the form of which is or shall be filed
as an exhibit to the registration statement of which this prospectus forms a part. Prospective investors should carefully review
the terms and provisions of the form of Pre-Funded Warrant for a complete description of the terms and conditions of the Pre-Funded
Warrants.
The
purpose of the Pre-Funded Warrants is to enable investors that may have restrictions on their ability to beneficially own more
than 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding Common Shares following the consummation of this offering
the opportunity to invest capital into the Company without triggering such ownership restrictions. By receiving Pre-Funded Warrants
in lieu of the Common Shares contained in the Units which would result in such holders’ ownership exceeding 4.99% (or, at
the election of the purchaser, 9.99%), such holders will have the ability to exercise their options to purchase the Common Shares
underlying the Pre-Funded Warrants for nominal consideration of $0.0001 per share at a later date.
Duration
and Exercise Price
Each
Pre-Funded Warrant offered hereby will have an initial exercise price per share equal to $0.0001. The Pre-Funded Warrants will
be immediately exercisable and may be exercised at any time until the Pre-Funded Warrants are exercised in full.
Adjustments
Until
such exercise termination date, the exercise price and number of Common Shares issuable upon exercise is subject to appropriate
adjustment in the event of stock dividends, stock splits, reorganizations or similar events affecting our Common Shares and the
exercise price, which are typical of such provisions in convertible securities. The Pre-Funded Warrants will be issued separately
from the accompanying Common Warrants, and may be transferred separately immediately thereafter.
Exercisability
The
Pre-Funded Warrants will be exercisable, at the option of each holder, in whole or in part, by delivering a duly executed exercise
notice accompanied by payment in full for the number of Common Shares purchased upon such exercise (except in the case of a cashless
exercise as discussed below). Subject to certain limitations and exceptions, a holder (together with its affiliates) may not exercise
any portion of a Pre-Funded Warrant to the extent that the holder would beneficially own more than 4.99% (or, at the election
of the purchaser, 9.99%) of the outstanding Common Shares immediately after exercise of such Pre-Funded Warrant, except that
upon at least 61 days’ prior notice from the holder to us, the holder may increase the amount of ownership of outstanding
stock after exercising the holder’s Pre-Funded Warrants up to 9.99% of the number of Common Shares outstanding immediately
after giving effect to the exercise. Purchasers of Pre-Funded Warrants in this offering may also elect prior to the issuance
of the Pre-Funded Warrants to have the initial exercise limitation set at 9.99% of our outstanding Common Shares. No fractional
Common Shares will be issued in connection with the exercise of a pre-funded warrant. In lieu of fractional Common Shares, we
will pay the holder an amount in cash equal to the fractional amount multiplied by the exercise price.
Cashless
Exercise
At
the time a holder exercises its Pre-Funded Warrants, in lieu of making the cash payment otherwise contemplated to be made to us
upon such exercise in payment of the aggregate exercise price, the holder may elect instead to receive upon such exercise (either
in whole or in part) the net number of Common Shares determined according to a formula set forth in the Pre-Funded Warrants.
Fundamental
Transaction
If,
at any time while the Pre-Funded Warrants are outstanding, (1) we, directly or indirectly, consolidate or merge with or into another
person, (2) we, directly or indirectly, sell, lease, license, assign, transfer, convey or otherwise dispose of all or substantially
all of our assets, (3) any direct or indirect purchase offer, tender offer or exchange offer (whether by us or another person)
is completed pursuant to which holders of our Common Shares are permitted to sell, tender or exchange their Common Shares for
other securities, cash or property and has been accepted by the holders of 50% or more of our outstanding shares of Common Shares,
(4) we, directly or indirectly, effect any reclassification, reorganization or recapitalization of our Common Shares or any compulsory
share exchange pursuant to which our Common Shares are converted into or exchanged for other securities, cash or property, or
(5) we, directly or indirectly, consummate a stock or share purchase agreement or other business combination with another person
whereby such other person acquires more than 50% of our outstanding Common Shares, each, a “Fundamental Transaction”,
then upon any subsequent exercise of the Pre-Funded Warrants, the holders thereof will have the right to receive the same amount
and kind of securities, cash or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction
if it had been, immediately prior to such Fundamental Transaction, the holder of the number of Common Shares then issuable upon
exercise of the Pre-Funded Warrant, and any additional consideration payable as part of the Fundamental Transaction.
Transferability
Subject
to applicable laws, a Pre-Funded Warrant may be transferred at the option of the holder upon surrender of the Pre-Funded Warrant
together with the appropriate instruments of transfer.
Exchange
Listing
There
is no trading market available for the Pre-Funded Warrants on any securities exchange or nationally recognized trading system.
We do not intend to list the Pre-Funded Warrants on any securities exchange or nationally recognized trading system, nor do we
have any obligation to do so.
Rights
as a Shareholder
While
the Pre-Funded Warrants have certain adjustment provisions as set forth above, except by virtue of such holder’s ownership
of Common Shares, a holder of Pre-Funded Warrants does not have rights or privileges of a holder of Common Shares, including any
voting rights or dividends, until the holder exercises the Pre-Funded Warrants.
Placement
Agent Warrants
The
material terms and provisions of the Placement Agent Warrants are substantially the same as the Common Warrants described above
under the heading “Common Warrants,” with the exception of the following terms:
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The
exercise price of the Placement Agent Warrants is 125% of the offering price per Unit;
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The
beneficial ownership threshold is set at 4.99%;
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Holders
of Placement Agent Warrants are not entitled to receive cash dividends or distribution or return of capital in the form of
cash made to holders of Common Shares (as, if and when declared by our board of directors); and
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The
Placement Agent Warrants are not transferrable for a period of 180 days from the date of effectiveness or the commencement
of sales of this offering, as described in “Plan of Distribution—Placement Agent Warrants”.
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INCOME
TAX CONSIDERATIONS
Material
U.S. Federal Income Tax Considerations for U.S. Holders
The
following discussion is a summary of the material U.S. federal income tax consequences applicable to the purchase, ownership and
disposition of our Common Shares, Common Warrants or Pre-Funded Warrants being offered by this prospectus supplement and
the accompanying prospectus by a U.S. Holder (as defined below), but does not purport to be a complete analysis of all potential
U.S. federal income tax effects.
This
summary is based on the Internal Revenue Code of 1986, as amended (the “Code”), U.S. Treasury regulations promulgated
thereunder, IRS rulings and judicial decisions in effect on the date of this prospectus supplement. This discussion addresses
only the U.S. federal income tax consequences to U.S. Holders that are initial purchasers of our Common Shares, Common Warrants
or Pre-Funded Warrants and that will hold such Common Shares, Common Warrants or Pre-Funded Warrants as capital assets for U.S.
federal income tax purposes. All of these are subject to change, possibly with retroactive effect, or different interpretations.
This summary does not discuss the potential effects, whether adverse or beneficial, of any proposed legislation that, if enacted,
could be applied on a retroactive basis. This summary is not binding on the IRS, and the IRS is not precluded from taking a position
that is different from, and contrary to, the positions taken in this summary.
This
summary does not address all aspects of U.S. federal income taxation that may be relevant to particular U.S. Holders in light
of their specific circumstances (for example, U.S. Holders subject to the alternative minimum tax or the Medicare contribution
tax on net investment income under the Code) or to holders that may be subject to special rules under U.S. federal income tax
law, including, without limitation:
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dealers
in stocks, securities or currencies;
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securities
traders that use a mark-to-market accounting method;
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banks
and financial institutions;
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insurance
companies;
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regulated
investment companies;
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real
estate investment trusts;
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tax-exempt
organizations;
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retirement
plans, individual plans, individual retirement accounts and tax-deferred accounts;
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partnerships
or other pass-through entities for U.S. federal income tax purposes and their partners or members;
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persons
holding Common Shares, Common Warrants or Pre-Funded Warrants as part of a hedging or conversion transaction straddle or other
integrated or risk reduction transaction;
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persons
who or that are, or may become, subject to the expatriation provisions of the Code;
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persons
whose functional currency is not the U.S. dollar; and
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direct,
indirect or constructive owners of 10% or more of the total combined voting power of all classes of our voting stock or 10%
or more of the total value of shares of all classes of our stock.
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If
a partnership or other entity or arrangement classified as a partnership for U.S. federal income tax purposes holds Common Shares,
Common Warrants or Pre-Funded Warrants, the U.S. federal income tax treatment of a partner generally will depend on the status
of the partner and the activities of the partnership. This summary does not address the tax consequences to any such partner.
Such a partner should consult its own tax advisor as to the tax consequences of the partnership purchasing, owning and disposing
of Common Shares, Common Warrants or Pre-Funded Warrants.
A
“U.S. Holder” is a beneficial owner of Common Shares, Common Warrants or Pre-Funded Warrants that is, for U.S. federal
income tax purposes:
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an
individual who is a citizen or resident of the United States;
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a
corporation, or other entity taxable as a corporation for U.S. federal income tax purposes, created or organized in or under
the laws of the United States, any state therein or the District of Columbia;
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an
estate the income of which is subject to U.S. federal income taxation regardless of its source; or
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a
trust with respect to which a U.S. court is able to exercise primary supervision over its administration and one or more U.S.
persons have the authority to control all of its substantial decisions, or that has a valid election in effect to be treated
as a U.S. person under applicable U.S. Treasury Regulations.
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PROSPECTIVE
INVESTORS SHOULD CONSULT THEIR OWN TAX ADVISORS WITH REGARD TO THE APPLICATION OF THE TAX CONSEQUENCES DESCRIBED BELOW TO THEIR
PARTICULAR SITUATIONS AS WELL AS THE APPLICATION OF ANY STATE, LOCAL, FOREIGN OR OTHER TAX LAWS, INCLUDING GIFT AND ESTATE TAX
LAWS.
Tax
Treatment of the Pre-Funded Warrants
Although
the characterization of the Pre-Funded Warrants for U.S. federal income tax purposes is not entirely clear, we expect to treat
our Pre-Funded Warrants as a class of our common stock for U.S. federal income tax purposes. However, our position is not binding
on the IRS and the IRS may treat the Pre-Funded Warrants as warrants to acquire our Common Shares. Accordingly, you should consult
your tax adviser regarding the U.S. federal tax consequences of an investment in the Pre-Funded Warrants. The following discussion
assumes our Pre-Funded Warrants are properly treated as a class of our common stock.
Allocation
of Purchase Price and Characterization of Units
For
U.S. federal income tax purposes, each Unit and Pre-Funded Unit should be treated as an “investment unit” and the
purchase price for each investment unit should be allocated between the two components thereof in proportion to their relative
fair market values at the time the unit is purchased by the holder. This allocation of the purchase price for each unit will establish
the holder’s initial tax basis for U.S. federal income tax purposes in the share of common stock or Pre-Funded Warrant,
as applicable, and the Common Warrant included in each unit. The separation of the share of common stock or Pre-Funded Warrant,
as applicable, and the Common Warrant included in each unit should not be a taxable event for U.S. federal income tax purposes.
Each holder should consult his, her or its own tax advisor regarding the allocation of the purchase price for a unit.
Tax
Consequences if we are a Passive Foreign Investment Company
A
foreign corporation will be classified as a PFIC for any taxable year in which, after taking into account the income and assets
of the corporation and certain subsidiaries pursuant to applicable “look-through rules,” either (i) at least 75% of
its gross income is “passive income” or (ii) at least 50% of the average quarterly value of its assets is attributable
to assets which produce passive income or are held for the production of passive income. Passive income generally includes dividends,
interest, rents and royalties (other than certain rents and royalties derived in the active conduct of a trade or business), annuities
and gains from assets that produce passive income. If a non-U.S. corporation owns at least 25% by value of the stock of another
corporation, the non-U.S. corporation is treated for purposes of the PFIC tests as owning its proportionate share of the assets
of the other corporation and as receiving directly its proportionate share of the other corporation’s income.
The
determination of whether we are, or will be, a PFIC for a taxable year depends, in part, on the application of complex U.S. federal
income tax rules, which are subject to various interpretations. Although the matter is not free from doubt, we believe that we
were not a PFIC during our 2019 taxable year and will not likely be a PFIC during our 2020 taxable year. Because PFIC status is
based on our income, assets and activities for the entire taxable year, and our market capitalization, it is not possible to determine
whether we will be characterized as a PFIC for the 2020 taxable year until after the close of the taxable year. The tests for
determining PFIC status are subject to a number of uncertainties. These tests are applied annually, and it is difficult to accurately
predict future income, assets and activities relevant to this determination. In addition, because the market price of our Common
Shares is likely to fluctuate, the market price may affect the determination of whether we will be considered a PFIC. There can
be no assurance that we will not be considered a PFIC for any taxable year (including our 2020 taxable year). Prospective investors
should consult their tax advisors regarding the Company’s PFIC status.
If
the Company is classified as a PFIC for any taxable year during which a U.S. Holder owns Common Shares, Common Warrants or Pre-Funded
Warrants, the U.S. Holder, absent certain elections (including the mark-to-market and QEF elections described below), will generally
be subject to adverse rules (regardless of whether the Company continues to be classified as a PFIC) with respect to (i) any “excess
distributions” (generally, any distributions received by the U.S. Holder on the Common Shares, Common Warrants or Pre-Funded
Warrants in a taxable year that are greater than 125% of the average annual distributions received by the U.S. Holder in the three
preceding taxable years or, if shorter, the U.S. Holder’s holding period for the Common Shares, Common Warrants or Pre-Funded
Warrants) and (ii) any gain realized on the sale or other disposition of the Common Shares, Common Warrants or Pre-Funded Warrants.
Under
these adverse rules (a) the excess distribution or gain will be allocated ratably over the U.S. Holder’s holding period,
(b) the amount allocated to the current taxable year and any taxable year prior to the first taxable year in which the Company
is classified as a PFIC will be taxed as ordinary income and (c) the amount allocated to each of the other taxable years during
which the Company was classified as a PFIC will be subject to tax at the highest rate of tax in effect for the applicable category
of taxpayer for that year and an interest charge will be imposed with respect to the resulting tax attributable to each such other
taxable year. A U.S. Holder that is not a corporation will be required to treat any such interest paid as “personal interest,”
which is not deductible.
Under
proposed Treasury Regulations, if a U.S. Holder has an option, warrant, or other right to acquire stock of a PFIC (such as the
Common Warrants), such option, warrant or right is considered to be PFIC stock also subject to these default rules discussed above.
However, a U.S. Holder generally may not make a QEF election or mark-to-market Election with respect to warrants. In addition,
under proposed Treasury Regulations, if a U.S. Holder holds an option, warrant or other right to acquired stock of a PFIC, the
holding period with respect to shares of stock of the PFIC acquired upon exercise of such option, warrant or other right will
include the period that the option, warrant or other right was held. Thus, this will impact the availability of timely QEF election
and mark-to-market election with respect to such shares as discussed below. Because of the complexity and uncertainty of the treatment
of Common Warrants under the PFIC rules, each U.S. Holder should consult his own tax advisor regarding the application of the
PFIC rules to the Common Shares acquired upon an exercise of Common Warrants and the availability of, and procedure for making,
a qualifying election with respect to Common Warrants.
U.S.
Holders can avoid the adverse rules described above in part by making a mark-to-market election with respect to the Common Shares,
provided that the Common Shares are “marketable.” The Common Shares will be marketable if they are “regularly
traded” on a “qualified exchange” or other market within the meaning of applicable U.S. Treasury regulations.
For this purpose, the Common Shares generally will be considered to be regularly traded during any calendar year during which
they are traded, other than in de minimis quantities, on at least 15 days during each calendar quarter. The Common Shares are
currently listed on the NASDAQ, which constitutes a qualified exchange; however, there can be no assurance that the Common Shares
will be treated as regularly traded for purposes of the mark-to-market election on a qualified exchange. If the Common Shares
were not regularly traded on the NASDAQ or were delisted from the NASDAQ and were not traded on another qualified exchange for
the requisite time period described above, the mark-to-market election would not be available. A mark-to-market election is not
expected to be available with respect to the Pre-Funded Warrants, which are not likely to be treated as regularly traded on a
qualified exchange.
A
U.S. Holder that makes a mark-to-market election must include in gross income, as ordinary income, for each taxable year an amount
equal to the excess, if any, of the fair market value of the U.S. Holder’s Common Shares at the close of the taxable year
over the U.S. Holder’s adjusted tax basis in the Common Shares. An electing U.S. Holder may also claim an ordinary loss
deduction for the excess, if any, of the U.S. Holder’s adjusted tax basis in the Common Shares over the fair market value
of the Common Shares at the close of the taxable year, but this deduction is allowable only to the extent of any net mark-to-market
gains previously included in income. A U.S. Holder that makes a mark-to-market election generally will adjust such U.S. Holder’s
tax basis in the Common Shares to reflect the amount included in gross income or allowed as a deduction because of such mark-to-market
election. Gains from an actual sale or other disposition of the Common Shares will be treated as ordinary income, and any losses
incurred on a sale or other disposition of the Common Shares will be treated as ordinary losses to the extent of any net mark-to-market
gains previously included in income.
If
we are classified as a PFIC for any taxable year in which a U.S. Holder owns Common Shares, but before a mark-to-market election
is made, the adverse PFIC rules described above will apply to any mark-to-market gain recognized in the year the election is made.
Otherwise, a mark-to-market election will be effective for the taxable year for which the election is made and all subsequent
taxable years. The election cannot be revoked without the consent of the IRS unless the Common Shares cease to be marketable,
in which case the election is automatically terminated.
If
the Company is classified as a PFIC, a U.S. Holder will generally be treated as owning stock owned by the Company in any direct
or indirect subsidiaries that are also PFICs and will be subject to similar adverse rules with respect to distributions to the
Company by, and dispositions by the Company of, the stock of such subsidiaries. A mark-to-market election is not permitted for
the shares of any subsidiary of the Company that is also classified as a PFIC. Prospective investors should consult their tax
advisors regarding the availability of, and procedure for making, a mark-to-market election.
In
some cases, a shareholder of a PFIC can avoid the interest charge and the other adverse PFIC consequences described above by making
a QEF election to be taxed currently on its share of the PFIC’s undistributed income. We will endeavor to satisfy the record
keeping requirements that apply to a QEF and to supply requesting U.S. Holders with the information that such U.S. Holders are
required to report under the QEF rules. There can be no assurance, however, that we will satisfy the record keeping requirements
or provide the information required to be reported by U.S. Holders.
A
U.S. Holder that makes a timely and effective QEF election for the first tax year in which its holding period of its Common Shares
or Pre-Funded Warrants begins generally will not be subject to the adverse PFIC consequences described above with respect to its
Common Shares or Pre-Funded Warrants. Rather, a U.S. Holder that makes a timely and effective QEF election will be subject to
U.S. federal income tax on such U.S. Holder’s pro rata share of (a) the Company’s net capital gain, which will be
taxed as long-term capital gain to such U.S. Holder, and (b) the Company’s ordinary earnings, which will be taxed as ordinary
income to such U.S. Holder, in each case regardless of which such amounts are actually distributed to the U.S. Holder by the Company.
Generally, “net capital gain” is the excess of (i) net long-term capital gain over (ii) net short-term capital loss,
and “ordinary earnings” are the excess of (A) “earnings and profits” over (B) net capital gain.
A
U.S. Holder that makes a timely and effective QEF election with respect to the Company generally (a) may receive a tax-free distribution
from us to the extent that such distribution represents “earnings and profits” that were previously included in income
by the U.S. Holder because of such QEF election and (b) will adjust such U.S. Holder’s tax basis in the Common Shares or
Pre-Funded Warrants to reflect the amount included in income or allowed as a tax-free distribution because of such QEF election.
In addition, a U.S. Holder that makes a QEF election generally will recognize capital gain or loss on the sale or other taxable
disposition of Common Shares or Pre-Funded Warrants.
The
QEF election is made on a shareholder-by-shareholder basis. Once made, a QEF election will apply to the tax year for which the
QEF election is made and to all subsequent tax years, unless the QEF election is invalidated or terminated or the IRS consents
to revocation of the QEF election. In addition, if a U.S. Holder makes a QEF election, the QEF election will remain in effect
(although it will not be applicable) during those tax years in which we are not a PFIC.
If
the Company is classified as a PFIC and then ceases to be so classified, a U.S. Holder may make an election (a “deemed sale
election”) to be treated for U.S. federal income tax purposes as having sold such U.S. Holder’s Common Shares or Pre-Funded
Warrants on the last day of the taxable year of the Company during which it was a PFIC. A U.S. Holder that made a deemed sale
election would then cease to be treated as owning stock in a PFIC by reason of ownership of Common Shares or Pre-Funded Warrants
in the Company. Any gain recognized, however, as a result of making the deemed sale election would be subject to the adverse rules
described above and loss would not be recognized.
If
the Company is a PFIC in any year with respect to a U.S. Holder, the U.S. Holder will be required to file an annual information
return on IRS Form 8621 regarding distributions received on Common Shares and any gain realized on the disposition of Common Shares.
In
addition, if the Company is a PFIC, U.S. Holders will generally be required to file an annual information return with the IRS
(also on IRS Form 8621, which PFIC shareholders are required to file with their U.S. federal income tax or information returns)
relating to their ownership of Common Shares or Pre-Funded Warrants.
Prospective
investors should consult their tax advisors regarding the potential application of the PFIC regime and any reporting obligations
to which they may be subject under that regime.
Taxation
of Distributions
Subject
to the PFIC rules discussed above, any distributions paid by us out of current or accumulated earnings and profits (as determined
for U.S. federal income tax purposes), before reduction for any Canadian withholding tax paid with respect thereto, will generally
be taxable to a U.S. Holder as foreign source dividend income, and generally will not be eligible for the dividends received deduction
generally allowed to corporations.
Distributions
in excess of current and accumulated earnings and profits will be treated as a non-taxable return of capital to the extent of
the U.S. Holder’s adjusted tax basis in the Common Shares and, thereafter, as capital gain. We do not, however, intend to
calculate our earnings and profits under U.S. federal income tax principles. Therefore, U.S. Holders should expect that any distribution
from us generally will be treated for U.S. federal income tax purposes as a dividend. Prospective investors should consult their
own tax advisors with respect to the appropriate U.S. federal income tax treatment of any distribution received from us.
Dividends
paid to non-corporate U.S. Holders by us in a taxable year in which we are treated as a PFIC, or in the immediately following
taxable year, will not be eligible for the special reduced rates normally applicable to long-term capital gains. In all other
taxable years, dividends paid by us should be taxable to a non-corporate U.S. Holder at the special reduced rates normally applicable
to long-term capital gains, provided that certain conditions are satisfied (including a minimum holding period requirement). We
believe we were not a PFIC for the 2019 taxable year. However, no assurance can be provided that we will not be classified as
a PFIC for 2020 and, therefore, no assurance can be provided that a U.S. Holder will be able to claim a reduced rate for dividends
paid in 2020 or 2021 (if any). Please see the subsection above entitled “Material U.S. Federal Income Tax Considerations
— “Tax Consequences if we are a Passive Foreign Investment Company” for a more detailed discussion.
Under
current law, payments of dividends by us to non-Canadian investors are generally subject to a 25% Canadian withholding tax. The
rate of withholding tax applicable to U.S. Holders that are eligible for benefits under the Canada-United States Tax Convention
(the “Convention”) is reduced to a maximum of 15%. This reduced rate of withholding will not apply if the dividends
received by a U.S. Holder are effectively connected with a permanent establishment of the U.S. Holder in Canada. For U.S. federal
income tax purposes, U.S. Holders will be treated as having received the amount of Canadian taxes withheld by the Company, and
as then having paid over the withheld taxes to the Canadian taxing authorities. As a result of this rule, the amount of dividend
income included in gross income for U.S. federal income tax purposes by a U.S. Holder with respect to a payment of dividends may
be greater than the amount of cash actually received (or receivable) by the U.S. Holder from the Company with respect to the payment.
Subject
to certain limitations, a U.S. Holder will generally be entitled, at the election of the U.S. Holder, to a credit against its
U.S. federal income tax liability, or a deduction in computing its U.S. federal taxable income, for Canadian income taxes withheld
by us. This election is made on a year-by-year basis and applies to all foreign taxes paid (whether directly or through withholding)
by a U.S. Holder during a year. For purposes of the foreign tax credit limitation, dividends paid by us generally will constitute
foreign source income in the “passive category income” basket. The foreign tax credit rules are complex and prospective
investors should consult their tax advisors concerning the availability of the foreign tax credit in their particular circumstances.
Dividends
paid in Canadian dollars will be included in the gross income of a U.S. Holder in a U.S. dollar amount calculated by reference
to the exchange rate in effect on the date the U.S. Holder (actually or constructively) receives the dividend, regardless of whether
such Canadian dollars are actually converted into U.S. dollars at that time. If the Canadian dollars received are not converted
into U.S. dollars on the date of receipt, a U.S. Holder will have a tax basis in the Canadian dollars equal to their U.S. dollar
value on the date of receipt. Gain or loss, if any, realized on a sale or other disposition of the Canadian dollars will generally
be U.S. source ordinary income or loss to a U.S. Holder.
We
generally do not pay any dividends and do not anticipate paying any dividends in the foreseeable future.
Constructive
Dividends on Pre-Funded Warrants and Warrants
As
discussed above under “Dividend Policy,” we do not currently expect to make distributions on our Common Shares. Subject
to the PFIC rules described above, if at any time during the period in which a U.S. Holder held our Pre-Funded Warrants or Common
Warrants we were to pay a taxable dividend to our shareholders and, in accordance with the anti-dilution provisions of the Pre-Funded
Warrants or Common Warrants, the exercise price of the Pre-Funded Warrants or Common Warrants were decreased, that decrease would
be deemed to be the payment of a taxable dividend to a U.S. Holder of the Pre-Funded Warrants or Common Warrants to the extent
of our earnings and profits, notwithstanding the fact that the U.S. Holder would not receive a cash payment. If the exercise price
is adjusted in certain other circumstances (or in certain circumstances, there is a failure to make adjustments), that adjustment
may also result in the deemed payment of a taxable dividend to a U.S. Holder. U.S. Holders should consult their tax advisers regarding
the proper treatment of any adjustments to the Pre-Funded Warrants or Common Warrants and the interaction between these adjustments
and the PFIC rules.
Any
taxable deemed distribution will be generally taxed in the same manner as an actual distribution received by a U.S. Holder as
discussed above under “—Taxation of Distributions.”
Information
reporting and backup withholding may be required regarding the amount of any deemed distributions. See “Information Reporting
and Backup Withholding.” Because a deemed distribution would not result in the payment of any cash to a U.S. Holder from
which any applicable backup withholding could be satisfied, if backup withholding is paid on the U.S. Holder’s behalf (because
the U.S. Holder failed to establish an exemption from backup withholding), an applicable withholding agent may withhold such amounts
from the Common Shares or current or subsequent payments of cash payable to such U.S. Holder.
For
certain information reporting purposes, we are required to determine the date and amount of any such constructive distributions.
Recently proposed Treasury regulations, on which we may rely prior to the issuance of final regulations, specify how the date
and amount of constructive distributions are determined. U.S. Holders are urged to consult their own tax advisor with respect
to the tax consequences of any adjustment (or the absence of any adjustment) to the warrants and any resulting deemed distribution.
Sale,
Exchange or Other Taxable Disposition of Common Shares, Common Warrants or Pre-Funded Warrants
Subject
to the PFIC rules discussed above, upon a sale, exchange or other taxable disposition of Common Shares, Common Warrants or Pre-Funded
Warrants, a U.S. Holder generally will recognize capital gain or loss for U.S. federal income tax purposes equal to the difference,
if any, between the amount realized on the sale, exchange or other taxable disposition and the U.S. Holder’s adjusted tax
basis in the Common Shares, Common Warrants or Pre-Funded Warrants.
This
capital gain or loss will be long-term capital gain or loss if the U.S. Holder’s holding period in the Common Shares, Common
Warrants or Pre-Funded Warrants exceeds one year. The deductibility of capital losses is subject to limitations. Any gain or loss
will generally be U.S. source for U.S. foreign tax credit purposes.
Exercise
or Lapse of a Warrant or a Pre-funded Warrant
Subject
to the PFIC rules described above and except as discussed below with respect to the cashless exercise of a warrant, a U.S. Holder
generally will not recognize gain or loss on the exercise of a Common Warrant or a Pre-Funded Warrant and related receipt of a
Common Share, unless cash is received in lieu of the issuance of a fractional Common Share. However, under a proposed Treasury
Regulation (which is proposed to have retroactive effect), a U.S. Holder would recognize gain if the Pre-Funded Warrant was treated
as stock of a PFIC with respect to a U.S. Holder at the time of the exercise of the Pre-Funded Warrants and the stock received
upon the exercise was not treated as stock of a PFIC for the taxable year in which the exercise occurs.
A
U.S. Holder’s initial tax basis in the Common Share received on the exercise of a Common Warrant or Pre-Funded Warrant should
be equal to the sum of (i) the U.S. Holder’s tax basis in the Common Warrant or Pre-Funded Warrant (that is, an amount equal
to the portion of the purchase price of a Unit or a Pre-Funded Unit, as the case may be, allocable to the Common Warrant or Pre-Funded
Warrant, as the case may be, as described above) plus (ii) the exercise price paid by the U.S. Holder on the exercise of the Common
Warrant or Pre-Funded Warrant. A U.S. Holder’s holding period for Common Shares received on exercise of a warrant will commence
on the date following the date of exercise of the warrant and will not include the period during which the U.S. Holder held the
Common Warrant. Although it is not entirely clear, a U.S. Holder’s holding period for Common Shares received on exercise
of a Pre-Funded Warrant will likely include the period during which the U.S. Holder held the Pre-Funded Warrant.
The
U.S. federal income tax treatment of a cashless exercise of Common Warrants or Pre-Funded Warrants into Common Shares is unclear,
and the tax consequences of a cashless exercise could differ from the consequences upon the exercise of a Common Warrant or Pre-Funded
Warrant described in the preceding paragraph.
Due
to the absence of authority on the U.S. federal income tax treatment of a cashless exercise, there can be no assurance as to the
tax treatment that would be adopted by the IRS or a court of law. Accordingly, U.S. Holders should consult their own tax advisors
regarding the U.S. federal income tax consequences of a cashless exercise of Common Warrants or Pre-Funded Warrants.
Information
Reporting and Backup Withholding
In
general, information reporting for U.S. federal income tax purposes should apply to distributions made on our securities within
the United States to a U.S. Holder (other than an exempt recipient) and to the proceeds from sales and other dispositions of our
securities by a U.S. Holder (other than an exempt recipient) to or through a U.S. office of a broker. Payments made (and sales
and other dispositions effected at an office) outside the United States will be subject to information reporting in limited circumstances.
In addition, certain information concerning a U.S. Holder’s adjusted tax basis in securities it owns and adjustments to
that tax basis and whether any gain or loss with respect to such securities is long term or short term also may be required to
be reported to the IRS.
In
addition, U.S. federal income tax information reporting rules generally require certain individuals who are U.S. Holders to file
Form 8938 to report the ownership of specified foreign financial assets if the total value of those assets exceeds an applicable
threshold amount (subject to certain exceptions). For these purposes, a specified foreign financial asset includes not only a
financial account (as defined for these purposes) maintained by a foreign financial institution, but also any stock or security
issued by a non-U.S. person, any financial instrument or contract held for investment that has an issuer or counterparty other
than a U.S. person and any interest in a foreign entity, provided that the asset is not held in an account maintained by a financial
institution. The minimum applicable threshold amount is generally U.S. $50,000 in the aggregate, but this threshold amount varies
depending on whether the individual lives in the U.S., is married, files a joint income tax return with his or her spouse, and
on certain other factors. Certain domestic entities that are U.S. Holders may also be required to file Form 8938 if both (i) such
entities are owned at least 80% by an individual who is a U.S. citizen or U.S. tax resident (or in some cases, by a nonresident
alien who meets certain criteria) or are trusts with beneficiaries that are such individuals and (ii) more than 50% of their income
consists of certain passive income or more than 50% of their assets is held for the production of such income. U.S. Holders are
urged to consult with their tax advisors regarding their reporting obligations, including the requirement to file IRS Form 8938.
U.S.
Holders who transfer more than $100,000 to us in a 12-month period (and/or who become owners of 10% or more of our securities)
will be required to file IRS Form 926, Return by U.S. Transferor of Property to a Foreign Corporation, and U.S. Holders who become
holder of more than 10% of our securities may also have to file IRS Form 5471, Information Return of U.S. Persons With Respect
to Certain Foreign Corporations, in each case reporting transfers of cash or other property to us and information relating to
the U.S. Holder and us. Substantial penalties may be imposed upon a U.S. Holder that fails to comply with these filing requirements.
U.S. Holders should consult their own tax advisors about the need to file either of these forms. See also the discussion, above,
regarding Form 8621, Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund.
Backup
withholding of U.S. federal income tax, currently at a rate of 24%, generally will apply to dividends paid on our securities to
a U.S. Holder (other than an exempt recipient) and the proceeds from sales and other dispositions of our securities by a U.S.
Holder (other than an exempt recipient), in each case who:
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fails
to provide an accurate taxpayer identification number;
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●
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is
notified by the IRS that backup withholding is required; or
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●
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in
certain circumstances, fails to comply with applicable certification requirements.
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A
non-U.S. Holder generally may eliminate the requirement for information reporting and backup withholding by providing certification
of its foreign status, under penalties of perjury, on a duly executed applicable IRS Form W-8 or by otherwise establishing an
exemption.
Backup
withholding is not an additional tax. Rather, the amount of any backup withholding will be allowed as a credit against a U.S.
Holder’s U.S. federal income tax liability and may entitle such holder to a refund, provided that certain required information
is timely furnished to the IRS.
Holders
are urged to consult their own tax advisors regarding the application of backup withholding and the availability of and procedures
for obtaining an exemption from backup withholding in their particular circumstances.
Canadian
Federal Income Tax Considerations For U.S. Holders
The
following is a general summary, as of the date hereof, of the principal Canadian federal income tax considerations generally applicable
to the holding and disposition of Units and Pre-Funded Units acquired pursuant to this prospectus by a holder who, at all relevant
times, (a) for the purposes of the Income Tax Act (Canada) (the “Tax Act”), (i) is not resident, or deemed to be resident,
in Canada, (ii) deals at arm’s length with, and is not affiliated with, the Company, (iii) beneficially owns Common Shares,
Common Warrants and Pre-Funded Warrants, (collectively, the “Securities”), as the case may be, as capital property,
(iv) does not use or hold the Securities in the course of carrying on, or otherwise in connection with, a business or a part of
a business carried on or deemed to be carried on in Canada, and (v) is not a “registered non-resident insurer” or
“authorized foreign bank” within the meaning of the Tax Act, and (b) for the purposes of the Convention, is a resident of the U.S., has never been a resident
of Canada, does not have and has not had, at any time, a permanent establishment or fixed base in Canada, and is a qualifying
person or otherwise qualifies for the full benefits of the Convention. Securities will generally be considered to be capital property
to a holder unless such Securities are held in the course of carrying on a business of buying or selling securities or an adventure
or concern in the nature of trade. Holders who meet all the criteria in clauses (a) and (b) are referred to herein as a “U.S.
Holder” or “U.S. Holders.” This summary does not deal with special situations, such as the particular circumstances
of traders or dealers or holders who have entered or will enter into a “derivative forward agreement” (as defined
in the Tax Act) in respect of any of the Securities. Such holders and other holders who do not meet the criteria in clauses (a)
and (b) should consult their own tax advisors.
This
summary is based upon the current provisions of the Tax Act and the regulations thereunder (the “Regulations”) and
counsel’s understanding of the current administrative policies and assessing practices of the Canada Revenue Agency (the
“CRA”) made publicly available prior to the date hereof. It also takes into account all proposed amendments to the
Tax Act and the Regulations publicly released by the Minister of Finance (Canada) (the “Tax Proposals”) prior to the
date hereof, and assumes that all such Tax Proposals will be enacted as currently proposed. No assurance can be given that the
Tax Proposals will be enacted in the form proposed or at all. This summary does not otherwise take into account or anticipate
any changes in law, whether by way of legislative, judicial or administrative action or interpretation, nor does it take into
account tax laws of any province or territory of Canada or of any other jurisdiction outside Canada.
This
summary is of a general nature only and is not intended to be, nor should it be construed to be, legal or tax advice to any particular
U.S. Holder and no representation with respect to the federal income tax consequences to any particular U.S. Holder or prospective
U.S. Holder is made. The tax consequences to a U.S. Holder will depend on the holder’s particular circumstances. Accordingly,
U.S. Holders should consult with their own tax advisors for advice with respect to their own particular circumstances.
Currency
Conversion
In
general, for purposes of the Tax Act, all amounts relating to the acquisition, holding or disposition of the Securities must be
converted into Canadian dollars based on the applicable exchange rate quoted by the Bank of Canada for the relevant day or such
other rate of exchange that is acceptable to the CRA.
Allocation
of Cost
A
U.S. Holder who acquires Units will be required to allocate the purchase price paid for each Unit on a reasonable basis between
the Common Share and the Common Warrant comprising each Unit in order to determine their respective costs to such U.S. Holder
for the purposes of the Tax Act.
A
U.S. Holder who acquires Pre-Funded Units will be required to allocate the purchase price paid for each Pre-Funded Unit on a reasonable
basis between the Pre-Funded Warrant and the Common Warrant comprising each Pre-Funded Unit in order to determine their respective
costs to such U.S. Holder for the purposes of the Tax Act.
Exercise
or Expiry of Warrants
No
gain or loss will be realized by a U.S. Holder of a Common Warrant or Pre-Funded Warrant (collectively, the “Warrants”)
upon the exercise of such Warrants for Common Shares. When a Warrant is exercised, the U.S. Holder’s cost of the Common
Share acquired thereby will be equal to the adjusted cost base of the Warrant to such U.S. Holder, plus the amount paid by such
U.S. Holder on the exercise of the Warrant. For the purpose of computing the adjusted cost base to a U.S. Holder of the Common
Shares acquired on the exercise of Warrants, the cost of such Common Shares must be averaged with the adjusted cost base to such
U.S. Holder of all other Common Shares (if any) held by the U.S. Holder as capital property immediately prior to the exercise
of such Warrant.
Generally,
the expiry of an unexercised Warrant will give rise to a capital loss equal to the adjusted cost base to the U.S. Holder of such
expired Warrant.
Dividends
Amounts
paid or credited or deemed to be paid or credited as, on account or in lieu of payment, or in satisfaction of, dividends on the
Common Shares to a U.S. Holder will be subject to Canadian withholding tax. Under the Convention, the rate of Canadian withholding
tax on dividends paid or credited by the Company to a U.S. Holder that beneficially owns such dividends is generally 15% unless
the beneficial owner is a company that owns at least 10% of the Company’s voting stock at that time, in which case the rate
of Canadian withholding tax is reduced to 5%.
Dispositions
Upon
the disposition of a Security (but not upon the exercise of a Warrant), a U.S. Holder will realize a capital gain (or capital
loss) in the taxation year of the disposition equal to the amount by which the U.S. Holder’s proceeds of disposition, net
of any reasonable costs of disposition, exceed (or are exceeded by) the adjusted cost base to the U.S. Holder of the particular
Security immediately before the disposition or deemed disposition.
A
U.S. Holder will not be subject to tax under the Tax Act in respect of any capital gain realized by such U.S. Holder on a disposition
of Securities, unless such Securities constitute “taxable Canadian property” (as defined in the Tax Act) of the U.S.
Holder at the time of disposition and the U.S. Holder is not entitled to relief under the Convention.
Provided
that the Common Shares are listed on a designated stock exchange for purposes of the Tax Act (which currently includes the NASDAQ
and the TSX) at the time of the disposition, the Common Shares and Warrants, as applicable, generally will not constitute taxable
Canadian property of a U.S. Holder, unless: (a) at any time during the 60-month period immediately preceding the disposition or
deemed disposition of the Security (as applicable): (i) 25% or more of the issued shares of any class or series of the share capital
of the Company were owned by, or belonged to, one or any combination of (x) the U.S. Holder, (y) persons with whom the U.S. Holder
did not deal at arm’s length (within the meaning of the Tax Act) and (z) partnerships in which the U.S. Holder or a person
referred to in (y) holds a membership interest directly or indirectly through one or more partnerships; and (ii) more than 50%
of the fair market value of the Common Shares was derived directly or indirectly from one or any combination of: (A) real or immovable
property situated in Canada, (B) Canadian resource property (as defined in the Tax Act), (C) timber resource property (as defined
in the Tax Act), and (D) options in respect of, or interests in, or for civil law rights in, property described in any of (A)
through (C) above, whether or not such property exists; or (b) the Security (as applicable) is deemed under the Tax Act to be
taxable Canadian property.
If
a Security is taxable Canadian property to a U.S. Holder, any capital gain realized on the disposition or deemed disposition of
such Security may not be subject to Canadian federal income tax pursuant to the terms of the Convention. Non-Resident Holders
whose Securities may be taxable Canadian property should consult their own tax advisors.
PLAN
OF DISTRIBUTION
We
engaged H.C. Wainwright & Co., LLC (“Wainwright” or the “placement agent”) to act as our exclusive
placement agent to solicit offers to purchase the securities offered by this prospectus. The placement agent is not purchasing
or selling any securities, nor are they required to arrange for the purchase and sale of any specific number or dollar amount
of securities, other than to use their “best efforts” to arrange for the sale of securities by us. Therefore, we may
not sell the entire amount of shares being offered. We may enter into a securities purchase agreement directly with certain institutional
investors who purchase our securities in this offering. We will not enter into securities purchase agreements with all other investors
and such investors shall rely solely on this prospectus in connection with the purchase of our securities in this offering.
Upon
the closing of this offering, we will pay the placement agent a cash transaction fee and a management fee, equal to 7.25% and
1.0%, respectively, of the gross proceeds to us from the sale of the securities in the offering (excluding any proceeds from the
exercise of the warrants issued in the offering).
The
following table shows the per Unit and per Pre-funded Unit and total placement agent fees we will pay assuming the sale of all
of the securities offered pursuant to this prospectus.
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Per Unit
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Per Pre- funded Unit
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Total
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Placement Agent Fees
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$
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$
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$
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Total
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$
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$
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$
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We
will also pay the placement agent a non-accountable expense allowance of $20,000, reimburse the placement agent
$12,900 for the clearing expenses of the placement agent and reimburse the placement agent’s legal fees and expenses in
an amount up to $100,000 in connection with this offering. We estimate the total offering expenses of this offering that will
be payable by us, excluding the placement agent fees and expenses, will be approximately $409,000.
After deducting the fees
due to the placement agent and our estimated offering expenses, we expect the net proceeds from this offering to be approximately
$9.9 million, based on the sale of the maximum amount of 14,457,831 Units in this offering at an assumed public offering price
of $0.83 per Unit (the last reported sale price of our Common Shares on NASDAQ on June 26, 2020) after deducting the placement
agent fees and estimated offering expenses payable by us.
Placement
Agent Warrants
In
addition, we have agreed to issue to the placement agent or its designees warrants, or the Placement Agent Warrants, to purchase
_____ Common Shares (which represents 7.0% of the aggregate number of Common Shares (i) included in the Units and (ii) issuable
upon the exercise of the Pre-Funded Warrants included within the Pre-Funded Units that are, in each case, placed in this offering
to investors). The Placement Agent Warrants will have an exercise price of $________ per Common Share (equal to 125% of the price
of the Units sold in this offering) and will terminate on the fifth anniversary of the effective date of this offering.
Pursuant to FINRA Rule 5110(g), the Placement Agent Warrants and any Common Shares issued upon exercise of the Placement Agent
Warrants shall not be sold, transferred, assigned, pledged, or hypothecated, or be the subject of any hedging, short sale, derivative,
put, or call transaction that would result in the effective economic disposition of the securities by any person for a period
of 180 days immediately following the effective date of this offering or commencement of sales of this offering, except the transfer
of any security:
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●
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by
operation of law or by reason of reorganization of our company;
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●
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to
any FINRA member firm participating in the offering and the officers or partners thereof, if all securities so transferred
remain subject to the lock-up restriction set forth above for the remainder of the time period;
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●
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if
the aggregate amount of securities of our company held by the holder of the Placement Agent Warrants or related persons do
not exceed 1% of the securities being offered;
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●
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that
is beneficially owned on a pro-rata basis by all equity owners of an investment fund, provided that no participating member
manages or otherwise directs investments by the fund, and participating members in the aggregate do not own more than 10%
of the equity in the fund; or
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●
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the
exercise or conversion of any security, if all securities received remain subject to the lock-up restriction set forth above
for the remainder of the time period.
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This
prospectus also relates to the offering of Common Shares issuable upon the exercise of the Placement Agent Warrants.
The
placement agent may be deemed an underwriter within the meaning of Section 2(a)(11) of the Securities Act and any fees received
by it and any profit realized on the sale of the securities by it while acting as principal might be deemed to be underwriting
discounts or commissions under the Securities Act. The placement agent will be required to comply with the requirements of the
Securities Act and the Exchange Act of 1934, as amended (the “Exchange Act”), including, without limitation, Regulation
M under the Exchange Act. These rules and regulations may limit the timing of purchases and sales of our securities by the placement
agent. Under these rules and regulations, the placement agent may not (i) engage in any stabilization activity in connection with
our securities; and (ii) bid for or purchase any of our securities or attempt to induce any person to purchase any of our securities,
other than as permitted under the Exchange Act, until they have completed their participation in the distribution.
Right
of First Refusal
We
have also granted Wainwright, subject to certain exceptions, a right of first refusal for a period of 12 months following the
closing of this offering to act as sole book-running manager, sole underwriter, sole placement agent or sole agent for each and
every future public offering (including at-the-market facility) or a private placement or any other capital raising financing
of equity or equity-linked securities using an underwriter or placement agent by us or any of our subsidiaries.
Tail
Financing Payments
We
have also agreed to pay Wainwright, subject to
certain exceptions, a tail fee equal to the cash and warrant compensation in this offering,
if any investor, who was contacted by Wainwright during the term of its engagement or introduced to us by Wainwright during the
term of its engagement, provides us with capital in any public or private offering or other financing or capital raising transaction
during the 12-month period following the expiration of the term of engagement, which is for four months commencing June 10, 2020.
Other
Relationships
The
placement agent may, from time to time, engage in transactions with or perform services for us in the ordinary course of its business
and may continue to receive compensation from us for such services, but we have no present agreements with the placement agent
to do so. In particular, the placement agent served as our exclusive placement agent for the registered direct offering of 3,478,261
common shares, at a purchase price of $1.29 per share, and the concurrent private placement of warrants to purchase up to an aggregate
of 2,608,696 common shares, which closed on February 21, 2020, for which they received an aggregate of $371,250 in fees and reimbursement
of certain expenses. In addition, as part of the placement agent’s compensation in connection with such registered direct
offering and the concurrent private placement of warrants, we also issued on February 21, 2020, 243,478 warrants to
the designees of the placement agent with an exercise price of $1.61719 per common share. The placement agent also served as our
sales agent for an at-the-market offering pursuant to a sales agreement dated April 27, 2017.
Determination
of offering price
The
public offering price of the securities offered hereby was negotiated between us and the investors, in consultation with the placement
agent, and other advisors to us, based on the trading of our Common Shares prior to the offering, among other things. Other factors
considered in determining the public offering price of the securities offered hereby include our history and prospects, the stage
of development of our business, our business plans for the future and the extent to which they have been implemented, an assessment
of our management, general conditions of the securities markets at the time of the offering and such other factors as were deemed
relevant.
Lock-up
Agreements
Our officers and directors
who are holders of our securities at the time of the offering, are expected, at the time of the offering, to enter into agreements
with the placement agent and certain investors in the offering to be subject to a lock-up period of 30 days following the
date of closing of this offering. This means that, during the applicable lock-up period following the closing of the offering,
such persons may not offer for sale, contract to sell, sell, distribute, grant any option, right to warrant to purchase, pledge,
hypothecate or otherwise dispose of, directly or indirectly, any Common Shares or any securities convertible into, or exercisable
or exchangeable for, our Common Shares. Certain limited transfers are permitted during the lock-up period if the transferee agrees
to these lock-up restrictions. The placement agent may, in its sole discretion and without notice, waive the terms of any of
these lock-up agreements.
We have also agreed, in
the securities purchase agreements with certain investors in the offering, to similar lock-up restrictions on the issuance and
sale of our securities for 30 days following the closing date of the offering pursuant to this prospectus, although we
will be permitted to issue equity-based incentive compensation to directors, officers, employees and consultants under our existing
plans, as well as securities issuable upon exercise or conversion of securities issued and outstanding and securities to
be issued under certain previously contracted arrangements.
We have also agreed to
a restriction on the issuance of any variable priced securities for 12 months following the closing of this offering, except
that we may use an at-the-market offering facility through the placement agent following the date that is 90
days after the closing date of the offering.
Indemnification
We
have agreed to indemnify the placement agent against certain liabilities, including liabilities under the Securities Act, and
to contribute to payments that the placement agent may be required to make for these liabilities.
Offer
Restrictions Outside the United States
Canada
The securities offered under this prospectus are not qualified for
sale to the public in any Province or Territory of Canada and may not be offered or sold in a Province or Territory of Canada,
directly or indirectly, except in accordance with available exemptions from the prospectus requirements under applicable Canadian
securities laws and this prospectus does not constitute an offer of the securities, directly or indirectly, to the public in Canada.
The Company has not filed and does not intend to file a Canadian prospectus in connection with the securities offered by this prospectus.
The securities offered under this prospectus may not be offered, sold, resold, distributed or delivered, directly or indirectly,
in Canada or to any resident of Canada during the course of their distribution hereunder, except pursuant to a Canadian prospectus
or an exemption from the prospectus requirements under applicable Canadian securities laws.
European
Economic Area – Belgium, Germany, Luxembourg and Netherlands
The
information in this document has been prepared on the basis that all offers of securities will be made pursuant to an exemption
under the Directive 2003/71/EC (“Prospectus Directive”), as implemented in Member States of the European Economic
Area (each, a “Relevant Member State”), from the requirement to produce a prospectus for offers of securities.
An
offer to the public of securities has not been made, and may not be made, in a Relevant Member State except pursuant to one of
the following exemptions under the Prospectus Directive as implemented in that Relevant Member State:
(a)
to legal entities that are authorized or regulated to operate in the financial markets or, if not so authorized or regulated,
whose corporate purpose is solely to invest in securities;
(b)
to any legal entity that has two or more of (i) an average of at least 250 employees during its last fiscal year; (ii) a total
balance sheet of more than €€43,000,000 (as shown on its last annual unconsolidated or consolidated financial statements)
and (iii) an annual net turnover of more than €€50,000,000 (as shown on its last annual unconsolidated or consolidated
financial statements);
(c)
to fewer than 100 natural or legal persons (other than qualified investors within the meaning of Article 2(1)(e) of the Prospectus
Directive) subject to obtaining the prior consent of the Company or any underwriter for any such offer; or
(d)
in any other circumstances falling within Article 3(2) of the Prospectus Directive, provided that no such offer of securities
shall result in a requirement for the publication by the Company of a prospectus pursuant to Article 3 of the Prospectus Directive.
Israel
The
securities offered by this prospectus have not been approved or disapproved by the Israeli Securities Authority (the ISA), or
ISA, nor have such securities been registered for sale in Israel. The securities may not be offered or sold, directly or indirectly,
to the public in Israel, absent the publication of a prospectus. This document does not constitute a prospectus under the Israeli
Securities Law, 5728-1968, and has not been filed with or approved by the Israel Securities Authority. In the State of Israel,
this document is being distributed only to, and is directed only at, and any offer of the ordinary shares is directed only at,
investors listed in the first addendum to the Israeli Securities Law (the “Addendum”), consisting primarily of joint
investment in trust funds, provident funds, insurance companies, banks, portfolio managers, investment advisors, members of the
Tel Aviv Stock Exchange, underwriters, venture capital funds, entities with equity in excess of NIS 50 million and “qualified
individuals”, each as defined in the Addendum (as it may be amended from time to time), collectively referred to as qualified
investors (in each case purchasing for their own account or, where permitted under the Addendum, for the accounts of their clients
who are investors listed in the Addendum). Qualified investors will be required to submit written confirmation that they fall
within the scope of the Addendum, are aware of the meaning of same and agree to it. The ISA has not issued permits, approvals
or licenses in connection with the offering or publishing the prospectus; nor has it authenticated the details included herein,
confirmed their reliability or completeness, or rendered an opinion as to the quality of the securities being offered. Any resale
in Israel, directly or indirectly, to the public of the securities offered by this prospectus is subject to restrictions on transferability
and must be effected only in compliance with the Israeli securities laws and regulations.
United
Kingdom
Neither
the information in this document nor any other document relating to the offer has been delivered for approval to the Financial
Services Authority in the United Kingdom and no prospectus (within the meaning of section 85 of the Financial Services and Markets
Act 2000, as amended (“FSMA”)) has been published or is intended to be published in respect of the securities. This
document is issued on a confidential basis to “qualified investors” (within the meaning of section 86(7) of FSMA)
in the United Kingdom, and the securities may not be offered or sold in the United Kingdom by means of this document, any accompanying
letter or any other document, except in circumstances which do not require the publication of a prospectus pursuant to section
86(1) FSMA.
This
document should not be distributed, published or reproduced, in whole or in part, nor may its contents be disclosed by recipients
to any other person in the United Kingdom.
Any
invitation or inducement to engage in investment activity (within the meaning of section 21 of FSMA) received in connection with
the issue or sale of the securities has only been communicated or caused to be communicated and will only be communicated or caused
to be communicated in the United Kingdom in circumstances in which section 21(1) of FSMA does not apply to us.
In
the United Kingdom, this document is being distributed only to, and is directed at, persons (i) who have professional experience
in matters relating to investments falling within Article 19(5) (investment professionals) of the Financial Services and Markets
Act 2000 (Financial Promotions) Order 2005 (“FPO”), (ii) who fall within the categories of persons referred to in
Article 49 (2)(a) to (d) (high net worth companies, unincorporated associations, etc.) of the FPO or (iii) to whom it may otherwise
be lawfully communicated (together “relevant persons”). The investments to which this document relates are available
only to, and any invitation, offer or agreement to purchase will be engaged in only with, relevant persons. Any person who is
not a relevant person should not act or rely on this document or any of its contents.
EXPENSES
OF THE OFFERING
The
following table sets forth the costs and expenses, other than placement agent fees, payable by us in connection with the offer
and sale of the securities in this offering. All amounts listed below are estimates except the SEC registration fee, NASDAQ listing
fee and the Financial Industry Regulatory Authority, Inc., or FINRA, filing fee.
|
SEC registration fee
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|
$
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4,809
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|
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FINRA filing fee
|
|
$
|
6,058
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|
|
Legal fees and expenses
|
|
$
|
305,000
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|
|
Exchange fees
|
|
$
|
44,000
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Transfer agent and registrar fees
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|
$
|
5,000
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Accountant’s fees and expenses
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|
$
|
44,000
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|
|
Miscellaneous
|
|
$
|
133
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Total
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$
|
409,000
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LEGAL
MATTERS
The
validity of the Common Shares, the Common Shares issuable upon the exercise of the Common Warrants and Pre-Funded Warrants, if
any, and certain other matters of Canadian law will be passed upon for us by Stikeman Elliott LLP, Toronto, Canada. The validity
of the Pre-Funded Warrants, the Common Warrants and certain matters of U.S. federal and New York State law will be passed upon
for us by Lowenstein Sandler LLP, New York, New York. Certain legal matters in connection with this offering will be passed upon
for the placement agent by Haynes and Boone LLP, New York, New York.
EXPERTS
The
consolidated financial statements incorporated into this prospectus by reference to the Annual Report on Form 20-F for the year
ended December 31, 2019 have been so incorporated in reliance on the report (which contains an explanatory paragraph relating
to the Company’s ability to continue as a going concern as described in Note 1 to the consolidated financial statements)
of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts
in auditing and accounting.
ENFORCEABILITY
OF CIVIL LIABILITIES
We
are a corporation incorporated under and governed by the CBCA. Many of our officers and directors, and some of the experts
named in this prospectus, are residents of Canada or elsewhere outside of the U.S., and a substantial portion of our assets and
the assets of such persons are located outside the U.S. As a result, it may be difficult for investors in the U.S. to effect service
of process within the U.S. upon such directors, officers and representatives of experts who are not residents of the U.S. or to
enforce against them judgments of a U.S. court predicated solely upon civil liability under U.S. federal securities laws or the
securities laws of any state within the U.S. We have been advised by our legal counsel, Stikeman Elliott LLP, that a judgment
of a U.S. court predicated solely upon civil liability under U.S. federal securities laws would probably be enforceable in Canada
if the U.S. court in which the judgment was obtained has a basis for jurisdiction in the matter that would be recognized by a
Canadian court for the same purposes. We have also been advised by Stikeman Elliott LLP, however, that there is substantial doubt
as to whether an action could be brought in Canada in the first instance on the basis of liability predicated solely upon U.S.
federal securities laws.
WHERE
YOU CAN FIND MORE INFORMATION
We
file annual reports on Form 20-F with the SEC, and we furnish other documents, such as quarterly and current reports, proxy statements
and other information and documents that we file with the Canadian securities regulatory authorities, to the SEC, as required.
The materials we file with or furnish to the SEC are available to the public on the SEC’s Internet website at www.sec.gov.
Those filings are also available to the public on our corporate website at www.zentaris.com. Information contained
on our website is not a part of this prospectus and the inclusion of our website address in this prospectus is an inactive textual
reference only. As we are a Canadian issuer, we also file continuous disclosure documents with the Canadian securities regulatory
authorities, which documents are available on the System for Electronic Document Analysis and Retrieval (“SEDAR”)
website maintained by the Canadian Securities Administrators at www.sedar.com.
This
prospectus forms part of a registration statement that we filed with the SEC. The registration statement contains more information
than this prospectus regarding us and our Securities, including certain exhibits and schedules. You can obtain a copy of the registration
statement from the SEC at the address listed above or electronically at www.sec.gov.
DOCUMENTS
INCORPORATED BY REFERENCE
The
following documents have been filed with the various securities commissions or similar securities regulatory authorities in Canada
and are specifically incorporated by reference into, and form an integral part of, this Prospectus:
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|
●
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our
Annual Report on Form 20-F for the fiscal year ended December 31, 2019, filed with the SEC on March 31, 2020, as amended
by Form 20-F/A filed on June 18, 2020;
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●
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a Form 8-A12B/A filed with the SEC on May 5, 2019 to amend our previously filed Form 8-A12B filed on April 14, 2017;
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●
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a press release announcing that Aeterna Zentaris Inc. received a NASDAQ notification regarding the minimum bid price requirement on January 8, 2020, included as Exhibit 99.1 to a Report on Form 6-K furnished to the SEC on January 8, 2020;
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●
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a press release announcing that Aeterna Zentaris Inc. regained compliance with the NASDAQ minimum bid price requirement for continued listing on January 27, 2020, included as Exhibit 99.1 to a Report on Form 6-K furnished to the SEC on January 27, 2020;
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●
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a press release announcing the completion of patient recruitment in does-finding pediatric study of Macimorelin on January 28, 2020, included as Exhibit 99.1 to a Report on Form 6-K furnished to the SEC on January 28, 2020; and
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●
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the
Reports on Form 6-K furnished to the SEC on February
21, 2020 (two such Reports on such date), March
31, 2020 (excluding exhibit 99.3 thereto), April
6, 2020, April 7, 2020, May 6, 2020, as amended by Report on Form 6-K/A furnished to the SEC on May 11, 2020 (excluding
exhibits 99.3 and 99.4 thereto) and June 25, 2020.
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The
information relating to us contained in this prospectus does not purport to be comprehensive and should be read together with
the information contained in the documents incorporated or deemed to be incorporated by reference in this prospectus.
As
you read the above documents, you may find inconsistencies in information from one document to another. If you find inconsistencies
between the documents and this prospectus, you should rely on the statements made in the most recent document. All information
appearing in this prospectus is qualified in its entirety by the information and financial statements, including the notes thereto,
contained in the documents incorporated by reference herein.
Potential
investors, including any beneficial owner, may obtain a copy of any of the documents summarized herein (subject to certain restrictions
because of the confidential nature of the subject matter) or any of our SEC filings incorporated by reference herein without charge
by written or oral request directed to:
Aeterna
Zentaris Inc.
Attention:
Investor Relations
315
Sigma Drive
Summerville,
South Carolina
USA,
29486
Tel.
(843) 900-3223
You
should rely only on the information contained or incorporated by reference in this prospectus or a prospectus supplement. We have
not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent
information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction where the offer
or sale is not permitted. You should assume that the information appearing in this prospectus is accurate only as of the date
on the front cover of this prospectus, or such earlier date, that is indicated in this prospectus. Our business, financial condition,
results of operations and prospects may have changed since that date.
Up
to 14,457,831 Units
(each Unit consists of one Common Share and one Common Warrant to purchase one Common Share)
Up
to 14,457,831 Pre-Funded Units (each Pre-Funded Unit consists of one Pre-Funded Warrant to purchase one
Common Share and one Common Warrant to one Common Share)
Common
Shares underlying the Pre-Funded Warrants
Common
Shares underlying the Common Warrants
PRELIMINARY
PROSPECTUS
H.C.
Wainwright & Co.
The
date of this prospectus is_________, 2020
PART
II—INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM
6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Under
Section 124 of the Canada Business Corporations Act (the “CBCA”), the registrant may indemnify a present or
former director or officer of the registrant or another individual who acts or acted at the registrant’s request as a director
or officer, or an individual acting in a similar capacity, of another entity, against all costs, charges and expenses, including
an amount paid to settle an action or satisfy a judgment, reasonably incurred by the individual in respect of any civil, criminal,
administrative, investigative or other proceeding in which the individual is involved because of that association with the registrant
or other entity. The registrant may not indemnify an individual unless the individual (i) acted honestly and in good faith with
a view to the best interests of the registrant or, as the case may be, to the best interests of the other entity for which the
individual acted as director or officer or in a similar capacity at the registrant’s request, and (ii) in the case of a
criminal or administrative action or proceeding that is enforced by a monetary penalty, had reasonable grounds for believing that
his or her conduct was lawful. Such indemnification may be made in connection with an action by or on behalf of the registrant
or other entity to procure a judgment in its favor only with court approval. A director or officer is entitled to indemnification
from the registrant as a matter of right if he or she was not judged by the Court or other competent authority to have committed
any fault or omitted to do anything that he or she ought to have done and fulfilled the conditions set forth above. The registrant
may advance moneys to a director, officer or other individual for the costs, charges and expenses of a proceeding referred to
above. The individual shall repay the moneys if he or she does not fulfill the conditions set forth above to qualify for indemnification.
In
accordance with the provisions of the CBCA described above, the by-laws of the registrant provide that the Company shall, to the
full extent provided by law, indemnify a director or officer of the Company, a former director or officer of the Company or another
individual who acts or acted at the Company’s request as a director or officer, or an individual acting in a similar capacity,
of another entity, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment,
reasonably incurred by the individual in respect of any civil, criminal, administrative, investigative or other proceeding in
which the individual is involved because of that association with the corporation or other entity.
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons
controlling the registrant pursuant to the foregoing provisions, the registrant has been informed that in the opinion of the U.S.
Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act and is therefore
unenforceable.
The
registrant has also agreed to indemnify and save harmless the directors and its senior corporate officers as well as the managing
director of its German subsidiary pursuant to various Director and Officer Indemnification Agreements against certain costs, charges,
damages, awards, settlements, liabilities, interest, judgments, fines, penalties, statutory obligations, professional fees and
retainers and other expenses of whatever nature or kind, provided that any such costs, charges, professional fees and other expenses
are reasonable (collectively, “Expenses”) and from and against all Expenses sustained or incurred by the indemnified
party as a result of serving as a director, officer or employee of the registrant in respect of any act, matter, deed or thing
whatsoever made, done, committed, permitted, omitted or acquiesced in by the indemnified party as a director, officer or employee
of the registrant. The form of Director and Officer Indemnification Agreement has been furnished to the SEC as Exhibit 99.1 to
the registrant’s Report on Form 6-K dated October 21, 2016.
ITEM
7. RECENT SALES OF UNREGISTERED SECURITIES
Set
forth below are the sales of all unregistered securities of ours sold by us within the past three years (i.e., since June 1, 2017,
up to the date of this registration statement) which were not registered under the Securities Act:
On
February 21, 2020, the Company entered into a securities purchase agreement (the “2020 Securities Purchase Agreement”)
with institutional investors in the U.S. to purchase 3,478,261 Common Shares, at a purchase price of $1.29375 per share. Under
the terms of the 2020 Securities Purchase Agreement, the Company issued to the investors unregistered warrants to purchase up
to an aggregate of 2,608,696 Common Shares in a concurrent private placement. The warrants have an exercise price of $1.20 per
common share, are exercisable immediately and will expire five and one-half years following the date of issuance. The gross proceeds
from the offering totaled approximately $4.5 million, before deducting placement agent fees and offering expenses.
On
September 20, 2019, the Company entered into a securities purchase agreement with U.S. institutional investors to purchase $5.0
million in gross proceeds (before transaction costs of $0.8 million) of Common Shares for $1.50 per share in a registered direct
offering and warrants to purchase Common Shares in a concurrent private placement. Under the terms of the securities purchase
agreement, the Company sold 3,325,000 common shares. In the concurrent private placement, the Company issued warrants to purchase
up to an aggregate of 3,325,000 common shares. The warrants are exercisable commencing six months from the date of issuance, have
an exercise price of $1.65 per share and expire 5 years following the date of issuance.
The
privately placed securities above were offered and sold pursuant to an exemption from the registration requirements under Section
4(a)(2) of the Securities Act and Rule 506 of Regulation D promulgated thereunder since, among other things, the transactions
did not involve a public offering and the securities were acquired for investment purposes only and not with a view to or for
sale in connection with any distribution thereof.
ITEM
8. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a)
The following documents are filed as part of this registration statement:
See
Exhibit Index attached to this registration statement, which is incorporated by reference herein.
(b)
Financial Statement Schedules
None.
ITEM
9. UNDERTAKINGS
(a)
The undersigned registrant hereby undertakes:
(1)
To file, during any period in which offers or sales are being made, a further post-effective amendment to this registration statement:
(i)
To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;
(ii)
To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if
the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b)
if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering
price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and
(iii)
To include any material information with respect to the plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement.
(2)
That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering thereof.
(3)
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold
at the termination of the offering.
(4)
To file a post-effective amendment to the registration statement to include any financial statements required by Item 8. A. of
Form 20-F at the start of any delayed offering or throughout a continuous offering. Financial statements and information otherwise
required by Section 10(a)(3) of the Securities Act of 1933 need not be furnished, provided, that the registrant includes
in the prospectus, by means of a post-effective amendment, financial statements required pursuant to this paragraph (a) (4) and
other information necessary to ensure that all other information in the prospectus is at least as current as the date of those
financial statements.
(5)
That, for the purpose of determining liability of the Registrant under the Securities Act to any purchaser in the initial distribution
of the securities, the undersigned Registrant undertakes that in a primary offering of securities of the undersigned Registrant
pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if
the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned Registrant
will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
(i)
any preliminary prospectus or prospectus of the undersigned Registrant to the offering required to be filed pursuant to Rule 424;
(ii)
any free writing prospectus relating to the offering prepared by or on behalf of the undersigned Registrant or used or referred
to by an undersigned Registrant;
(iii)
the portion of any other free writing prospectus relating to the offering containing material information about the undersigned
Registrant or its securities provided by or on behalf of the undersigned Registrant; and
(iv)
any other communication that is an offer in the offering made by the undersigned Registrant to the purchaser.
(b)
The undersigned registrant hereby undertakes that:
(i)
For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus
filed as part of this registration statement in reliance upon Rule 430A and contained in the form of prospectus filed by the registrant
pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act of 1933 shall be deemed to be part of the registration statement
as of the time it was declared effective.
(ii)
For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form
of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(e)
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that
in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore,
unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant
of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered,
the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities
Act of 1933 and will be governed by the final adjudication of such issue.
EXHIBIT
INDEX
Exhibit
Index
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3.1
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Restated Certificate of Incorporation and Restated Articles of Incorporation of the Registrant (incorporated by reference to Exhibit 99.2 to the Registrant’s report on Form 6-K furnished to the Commission on May 25, 2011)
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3.2
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Certificate of Amendment and Articles of Amendment of the Registrant (incorporated by reference to Exhibit 99.2 to the Registrant’s report on Form 6-K furnished to the Commission on October 3, 2012)
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3.3
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Certificate of Amendment and Articles of Amendment of the Registrant (incorporated by reference to Exhibit 99.1 to the Registrant’s report on Form 6-K furnished to the Commission on November 17, 2015)
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3.4
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Amended and Restated By-Law One of the Registrant (incorporated by reference to Exhibit 1.3 of the Registrant’s Annual Report on Form 20-F for the financial year ended December 31, 2012 filed with the Commission on March 22, 2013)
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4.1
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|
Amended and Restated Shareholder Rights Plan Agreement between the Registrant and Computershare Trust Company of Canada, as Rights Agent, dated as of May 8, 2019 (incorporated by reference to Exhibit 99.2 to the Registrant’s report on Form 6-K furnished to the Commission on May 9. 2019)
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4.2
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Form of Warrant Agreement (incorporated by reference to Exhibit 99.1 of the Registrant’s report on Form 6-K furnished to the Commission on September 20, 2019)
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4.3
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Form of Investor Warrant (incorporated by reference to Exhibit 99.1 of the Registrant’s report on Form 6-K furnished to the Commission on February 21, 2020)
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4.4
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Form of Placement Agent Warrant (incorporated by reference to Exhibit 99.4 of the Registrant’s report on Form 6-K furnished to the Commission on February 21, 2020)
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4.5
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Form of Common Warrant
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4.6
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|
Form of Pre-Funded Warrant
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4.7
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Form of Placement Agent Warrant
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5.1
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Opinion of Stikeman Elliott LLP, Canadian counsel to the Company, as to the validity of the Common Shares
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5.2
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Opinion of Lowenstein Sandler LLP, U.S. counsel to the Company, as to the validity of the Pre-Funded Warrants and the Common Warrants
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10.1
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Second Amended and Restated Stock Option Plan of the Registrant (incorporated by reference to Exhibit 4.1 of the Registrant’s Annual Report on Form 20-F for the financial year ended December 31, 2013 filed with the Commission on March 21, 2014)
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10.2
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2018 Long-Term Incentive Plan of the Registrant (incorporated by reference to Exhibit 4.7 of the Registrant’s Form S-8 filed with the Commission on May 8, 2018)
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10.3
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License and Assignment Agreement, dated January 16, 2018 by and between Aeterna Zentaris GmbH and Strongbridge Ireland Limited (incorporated by reference to Exhibit 99.2 of the Registrant’s report on Form 6-K furnished to the Commission on January 19, 2018)
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10.4
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Employment Agreement dated October 1, 2017 between Michael Ward and the Registrant (incorporated by reference to Exhibit 4.3 of the Registrant’s Annual Report on Form 20-F for the financial year ended December 31, 2017 filed with the Commission on March 28, 2018)
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10.5
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Change of Control Agreement dated October 1, 2017 between Michael Ward and the Registrant (incorporated by reference to Exhibit 4.4 of the Registrant’s Annual Report on Form 20-F for the financial year ended December 31, 2017 filed with the Commission on March 28, 2018)
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10.6
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Independent Contractor Agreement dated September 18, 2018 between Leslie Auld and the Registrant (incorporated by reference to Exhibit 4.8 of the Registrant’s Annual Report on Form 20-F for the financial year ended December 31, 2018 filed with the Commission on April 1, 2019)
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10.7
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Master Collaboration Agreement by and between Aeterna Zentaris GmbH, a subsidiary of the Registrant, and Sinopharm A-think Pharmaceuticals Co., Ltd, dated as of December 1, 2014 (incorporated by reference to Exhibit 99.2 of the Registrant’s report on Form 6-K furnished to the Commission on December 11, 2014)
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10.8
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License Agreement by and between Aeterna Zentaris GmbH, a subsidiary of the Registrant, and Sinopharm A-think Pharmaceuticals Co., Ltd, dated as of December 1, 2014 (incorporated by reference to Exhibit 99.3 of the Registrant’s report on Form 6-K furnished to the Commission on December 11, 2014)
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10.9
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Technology Transfer and Technical Assistance, Agreement by and between Aeterna Zentaris GmbH, a subsidiary of the Registrant, and Sinopharm A-think Pharmaceuticals Co., Ltd, dated as of December 1, 2014 (incorporated by reference to Exhibit 99.4 of the Registrant’s report on Form 6-K furnished to the Commission on December 11, 2014)
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10.10±
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|
Director and Officer Indemnification Agreement (incorporated by reference to Exhibit 99.1 of the Registrant’s report on Form 6-K furnished to the Commission on October 21, 2016)
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10.11
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|
Placement Agency Agreement between the Registrant and Maxim Group LLC, dated as of September 20, 2019 (incorporated by reference to Exhibit 99.2 of the Registrant’s report on Form 6-K furnished to the Commission on September 20, 2019)
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10.12
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Form of Securities Purchase Agreement by and between the Registrant and certain institutional investors, dated as of September 20, 2019 (incorporated by reference to Exhibit 99.3 of the Registrant’s report on Form 6-K furnished to the Commission on September 20, 2019)
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10.13
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|
Form
of Securities Purchase Agreement by and between the Registrant and certain institutional investors, dated as of February 21,
2020 (incorporated by reference to Exhibit 99.2 of the Registrant’s report on Form 6-K furnished to the Commission on
February 21, 2020)
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10.14
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|
Engagement
Agreement by and between the Registrant and H.C. Wainwright & Co., LLC, dated as of February 18, 2020 (incorporated by
reference to Exhibit 99.3 of the Registrant’s report on Form 6-K furnished to the Commission on February 21, 2020)
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10.15
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|
Engagement
Agreement by and between the Registrant and H.C. Wainwright & Co., LLC, dated as of June 10, 2020
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10.16
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|
Form of Securities Purchase Agreement
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21.1
|
|
Subsidiaries
of the Registrant (incorporated by reference to Exhibit 8.1 of the Registrant’s Annual Report on Form 20-F for the financial
year ended December 31, 2019 filed with the Commission on March 31, 2020)
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23.1
|
|
Consent
of Stikeman Elliott LLP (included in Exhibit 5.1)
|
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23.2
|
|
Consent
of Lowenstein Sandler LLP (included in Exhibit 5.2)
|
|
23.3
|
|
Consent
of PricewaterhouseCoopers LLP
|
|
24.1*
|
|
Power
of Attorney
|
|
*
|
|
Previously
filed.
|
|
±
|
|
Management
contract or compensatory plan or arrangement.
|
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form F-1 and has duly caused this Amendment No. 1 to registration statement
to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Charleston, South Carolina, on June 30,
2020.
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|
AETERNA
ZENTARIS INC.
|
|
|
|
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By:
|
/s/
Klaus Paulini, PhD
|
|
|
Name:
|
Klaus
Paulini, PhD
|
|
|
Title:
|
President
and Chief Executive Officer
|
SIGNATURES
Pursuant to the requirements
of the Securities Act, this Amendment No. 1 to Registration Statement has been signed by the following persons in the capacities
indicated below on June 30, 2020.
|
Signature
|
|
Title
|
|
|
|
|
|
/s/
Klaus Paulini, PhD
|
|
President,
Chief Executive Officer (Principal
|
|
Klaus
Paulini, PhD
|
|
Executive
Officer) and Director
|
|
|
|
|
|
/s/
Leslie Auld
|
|
Senior
Vice President, Chief Financial Officer
|
|
Leslie
Auld
|
|
(Principal
Financial Officer and Principal Accounting Officer)
|
|
|
|
|
|
*
|
|
Director
and Chair of the Board
|
|
Carolyn
Egbert
|
|
|
|
|
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*
|
|
Director
|
|
Pierre-Yves
Desbiens
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
Peter
G. Edwards
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
Gilles
Gagnon
|
|
|
|
*By:
|
/s/
Klaus Paulini, PhD
|
|
|
|
Name:
|
Klaus Paulini, PhD
|
|
|
|
Title:
|
Attorney-in-fact
|
|
|
AUTHORIZED
REPRESENTATIVE
Pursuant
to the requirements of Section 6(a) of the Securities Act of 1933, the undersigned has signed this Amendment No. 1 to Registration
Statement on Form F-1, solely in the capacity of the duly authorized representative of Aeterna Zentaris Inc. in the United States,
on June 30, 2020.
|
|
AETERNA
ZENTARIS INC.
|
|
|
|
|
|
By:
|
/s/
Klaus Paulini, PhD
|
|
|
Name:
|
Klaus
Paulini, PhD
|
|
|
Title:
|
Authorized
Signatory
|
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