Cardiol Therapeutics Announces Exercise and Closing of Over-Allotment Option

Rhea-AI Summary

Cardiol Therapeutics Inc. (NASDAQ: CRDL) (TSX: CRDL) has announced the successful exercise and closing of the over-allotment option for its public offering. Canaccord Genuity purchased an additional 1,265,625 Class A common shares at US$1.60 per share, resulting in additional gross proceeds of $2,025,000. The total offering, including the over-allotment, now comprises 9,703,125 shares for aggregate gross proceeds of US$15,525,000.

The company plans to use the net proceeds to support the clinical development of CardiolRx for treating recurrent pericarditis, as well as for general and administrative expenses, working capital, and other expenses. The offering was made pursuant to U.S. and Canadian regulatory filings, including a U.S. registration statement on Form F-10 and a Canadian short form base shelf prospectus.

Positive

• Successfully raised US$15,525,000 in gross proceeds through public offering and over-allotment
• Full exercise of over-allotment option indicates strong investor demand
• Funds to support clinical development of CardiolRx for recurrent pericarditis treatment

Negative

• Potential dilution of existing shareholders due to issuance of new shares

Insights

Financial Analyst

The successful completion of Cardiol Therapeutics' public offering, including the full exercise of the over-allotment option, is a significant financial development. The company has raised a total of $15,525,000 in gross proceeds, which substantially strengthens its cash position. This capital infusion is important for advancing the clinical development of CardiolRx for recurrent pericarditis treatment.

The pricing of $1.60 per share and the full exercise of the over-allotment option suggest strong investor interest in Cardiol's potential. However, it's important to note that this offering will result in dilution for existing shareholders, with 9,703,125 new shares issued. The impact on the stock price in the short term may be negative due to this dilution, but the additional capital could drive long-term value if effectively utilized in clinical development.

The involvement of Canaccord Genuity as the sole bookrunner adds credibility to the offering. Investors should monitor how efficiently Cardiol deploys this capital and the progress of its clinical trials, as these factors will be critical in determining the company's future prospects and stock performance.

Medical Research Analyst

The successful fundraising by Cardiol Therapeutics is a positive development for its clinical research program, particularly for CardiolRx in treating recurrent pericarditis. This condition, characterized by inflammation of the pericardium, lacks many effective treatment options, representing a significant unmet medical need.

The $15.5 million raised will likely accelerate the clinical development process, potentially leading to faster progression through trial phases. This is important in the competitive landscape of cardiovascular therapeutics, where speed to market can be a significant advantage.

Investors should pay close attention to upcoming clinical trial results and any FDA interactions. Positive data or regulatory feedback could significantly impact the company's valuation. However, it's important to remember that drug development is inherently risky and setbacks in clinical trials could negatively affect the stock price. The company's focus on anti-inflammatory and anti-fibrotic therapies aligns with current trends in cardiovascular research, which could be advantageous if their approach proves successful.

Oakville, Ontario--(Newsfile Corp. - October 11, 2024) - Cardiol Therapeutics Inc. (NASDAQ: CRDL) (TSX: CRDL) ("Cardiol" or the "Company"), a clinical-stage life sciences company focused on the research and clinical development of anti-inflammatory and anti-fibrotic therapies for the treatment of heart disease, is pleased to announce that, further to its successfully completed public offering of an aggregate of 8,437,500 Class A common shares of the Company (the "Common Shares") at a price to the public of US$1.60 per Common Share (the "Offering Price") for gross proceeds of US$13.5 million (the "Offering"), Canaccord Genuity has purchased an additional 1,265,625 Common Shares at the Offering Price pursuant to their exercise in full of the over-allotment option (the "Over-Allotment Option"), for additional gross proceeds to the Company of $2,025,000 before deducting the underwriting commissions.

After giving effect to the full exercise of the Over-Allotment Option, Cardiol sold 9,703,125 Common Shares under the Offering, for aggregate gross proceeds of US$15,525,000.

The Company intends to use the net proceeds from the Offering to support the clinical development of CardiolRx for the treatment of recurrent pericarditis and for general and administrative expenses, working capital and other expenses.

Canaccord Genuity acted as the sole bookrunner in connection with the Offering.

The Offering was made pursuant to a U.S. registration statement on Form F-10, declared effective by the U.S. Securities and Exchange Commissions (the "SEC") on July 16, 2024 (the "Registration Statement"), and the Company's existing Canadian short form base shelf prospectus (the "Base Prospectus") dated July 12, 2024. A preliminary prospectus supplement relating to the Offering was filed with the securities commission in all of the provinces and territories of Canada, except Quebec, and with the SEC in the United States, and a final prospectus supplement relating to the Offering (the "Supplement") was filed with the securities commissions in all of the provinces and territories of Canada, except Quebec, and with the SEC in the United States. The Supplement and accompanying Base Prospectus contain important detailed information about the Offering.

The Supplement and accompanying Base Prospectus can be found on SEDAR+ at www.sedarplus.ca and on EDGAR at www.sec.gov. Copies of the Supplement and accompanying Base Prospectus may also be obtained from Canaccord Genuity LLC, 1 Post Office Square, Suite 3000, Boston, Massachusetts 02109, Attn: Syndicate Department, or by email at prospectus@cgf.com.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any province, state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such province, state or jurisdiction.

About Cardiol Therapeutics

Cardiol Therapeutics Inc. is a clinical-stage life sciences company focused on the research and clinical development of anti-inflammatory and anti-fibrotic therapies for the treatment of heart disease.

Cautionary statement regarding forward-looking information:

This news release contains "forward-looking information" within the meaning of applicable securities laws. All statements, other than statements of historical fact, that address activities, events, or developments that Cardiol believes, expects, or anticipates will, may, could, or might occur in the future are "forward-looking information". Forward looking information contained herein may include, but is not limited to statements regarding the anticipated use of proceeds from the Offering. Forward-looking information contained herein reflects the current expectations or beliefs of Cardiol based on information currently available to it and is based on certain assumptions and is also subject to a variety of known and unknown risks and uncertainties and other factors that could cause the actual events or results to differ materially from any future results, performance or achievements expressed or implied by the forward looking information, and are not (and should not be considered to be) guarantees of future performance. These risks and uncertainties and other factors include the risks and uncertainties referred to in the Company's Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission and Canadian securities regulators on April 1, 2024, as well as the risks and uncertainties associated with product commercialization and clinical studies. These assumptions, risks, uncertainties, and other factors should be considered carefully, and investors should not place undue reliance on the forward-looking information, and such information may not be appropriate for other purposes. Any forward-looking information speaks only as of the date of this press release and, except as may be required by applicable securities laws, Cardiol disclaims any intent or obligation to update or revise such forward-looking information, whether as a result of new information, future events, or results, or otherwise. Investors are cautioned not to rely on these forward-looking statements and are encouraged to read the Supplement, the accompanying Base Prospectus and the documents incorporated by reference therein.

For further information, please contact:

Trevor Burns, Investor Relations +1-289-910-0855
trevor.burns@cardiolrx.com

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/226366

FAQ

How much did Cardiol Therapeutics (CRDL) raise in their recent public offering?

Cardiol Therapeutics raised a total of US$15,525,000 in gross proceeds, including US$13.5 million from the initial offering and US$2,025,000 from the full exercise of the over-allotment option.

What is the intended use of proceeds for Cardiol Therapeutics' (CRDL) recent offering?

The net proceeds will be used to support the clinical development of CardiolRx for the treatment of recurrent pericarditis, as well as for general and administrative expenses, working capital, and other expenses.

How many shares did Cardiol Therapeutics (CRDL) sell in their recent public offering?

Cardiol Therapeutics sold a total of 9,703,125 Class A common shares, including 8,437,500 from the initial offering and 1,265,625 from the over-allotment option.

What was the price per share for Cardiol Therapeutics' (CRDL) recent public offering?

The offering price was US$1.60 per Class A common share.