Authorized capital stock:

 

Unlimited number of shares:

 

 

 

 

 

 

On the Corporation entered into an “at-the-market” (“ATM”) sales agreement with an underwriter B. Riley FBR, Inc. (B. Riley), pursuant to which the Corporation’s common shares be sold from time to time for aggregate gross proceeds of up to US million, with sales only being made on the NASDAQ Stock Market. The common shares would be issued at market prices prevailing at the time of the sale and, as a result, prices vary between purchasers and during the period of distribution. The ATM provides the Company with a flexible alternative for raising additional capital. The ATM has a year term, and requires the company to pay a fee to B. Riley when any sales are made. As at securities have been issued in relation to the ATM. Costs incurred in connection to the ATM of have been recorded as deferred financing costs.

 

 

On the Corporation closed a U.S. public offering of Common Shares at a price of per share. In addition, the underwriters fully exercised their over-allotment option to purchase additional Common Shares at the same public offering price. This offering generated gross proceeds of million ( million), which resulted in net proceeds to the Corporation of million ( million) and a total of Common Shares issued.

 

On the Corporation closed a Canadian public offering of Common Shares at a price of per share. In addition, the underwriters fully exercised their over-allotment option to purchase additional Common Shares at the same public offering price. This offering generated gross proceeds of million, which resulted in net proceeds to the Corporation of approximately million and a total of Common Shares issued.

 

 

On the Corporation closed a Canadian public offering issuing units of Acasti (“Units”) at a price of per Unit for gross proceeds of million. The units issued consist of Common Shares and Warrants. Each Warrant entitles the holder thereof to acquire Common Share of the Corporation at an exercise price of at any time until

 

On the underwriters exercised their over-allotment option by purchasing an additional units at a price of per Unit, for additional gross proceeds of million. The units issued consist of Common Shares and warrants. Each Warrant entitles the holder thereof to acquire Common Share of the Corporation at an exercise price of at any time until

 

The warrant component of these Units are Derivative Warrant Liabilities for accounting purposes due to the warrant agreement, which contains certain contingent provisions that allow for cash settlement (note ). The proceeds of the offering are required to be split between the Derivative Warrant Liabilities and the equity-classified Common shares at the time of issuance of the Units. The fair value of the Derivative Warrant Liabilities at the time of issuance was determined to be million and the residual of the proceeds of million were allocated to the Common Shares. Issuance costs related to this transaction totaled approximately million and have been allocated between the Derivative Warrant Liabilities and Common shares based on relative value. Resulting from this allocation, million has been allocated to the Derivative Warrant Liability and is recognized in finance costs in the Statements of Earnings and Comprehensive Loss, whereas the remaining portion of million in issuance costs was allocated to the Common Shares and recognized as a reduction to share capital, in the Statements of Financial Position.

 

The fair value of the public offering warrants at issuance was estimated using to the Black-Scholes option pricing model and was based on the following weighted average assumptions:

 

		May 2018
Exercise price		$	1.31
Share price		$	0.82
Risk-free interest			2.21	%
Estimated life (in years)			5
Expected volatility			87.40	%

 

The weighted average fair value of the public offering warrants issued in was determined to be per warrant. Changes in the subsequent measurement of fair value of the Warrants are recognized in financial expenses.

 

As part of the transaction, the Corporation also issued broker warrants to purchase up to Common Shares. Each broker warrant entitles the holder thereof to acquire Common Share of the Corporation at an exercise price of at any time until The broker warrants are considered to be compensation to non-employees under IFRS as stock-based compensation, and are thus accounted for at fair value at issuance date and subsequently revalued. To determine the fair value of these broker warrants, a Black-Scholes options pricing model was used based on the following assumptions:

 

		May 2018
Exercise price		$	1.05
Share price		$	0.81
Risk-free interest			2.20	%
Estimated life (in years)			5
Expected volatility			87.40	%

 

The total value associated with the broker warrants amounted to and was recorded in contributed surplus.

 

 

On the Corporation closed a U.S. public offering issuing units of Acasti at a price of per Unit for gross proceeds of million ( million). The units issued consist of Common Shares and warrants with the right to purchase Common Share of Acasti. As part of this closing, the underwriters’ also partially exercised for consideration the over-allotment option for warrants, which were issued for a right to purchase Common Shares at an exercise price of

 

The Warrants forming part of the Units are Derivative Warrant Liabilities for accounting purposes due to the currency of the exercise price being different from the Corporation’s functional currency. The proceeds of the offering are required to be split between the Derivative Warrant Liabilities and the equity-classified Common Share at the time of issuance of the Units. The fair value of the Derivative Warrant Liabilities at the time of issuance was determined to be million and the residual of the proceeds was allocated to the Common Shares. Total issuance costs related to this transaction totaled approximately million. The issuance costs have been allocated between the Warrants and Common Shares based on relative value. The portion allocated to the Warrants was recognized in finance costs in the Statements of Earnings and Comprehensive Loss, whereas the portion allocated to Common Shares was recognized as a reduction to share capital, in the Statements of Financial Position.

 

The fair value of the public offering Warrants at issuance was estimated according to the Black-Scholes option pricing model and based on the following assumptions:

 

		December 27, 2017
Exercise price			US $1.26
Share price			US $0.97
Risk-free interest			2.22	%
Estimated life (in years)			5
Expected volatility			93.52	%

 

The fair value of the public offering Warrants issued was determined to be per warrant as at Changes in the fair value of the Warrants are recognized in finance income or expenses.

 

As part of the transaction, the Corporation also issued broker warrants to purchase up to Common Shares. Each broker warrant entitles the holder thereof to acquire Common Share of the Corporation at an exercise price of at any time until The broker warrants are considered for compensation to non-employees under IFRS stock-based compensation, and are accounted for at fair value. To determine the fair value of the Broker Warrants, a Black-Scholes option pricing model was used based on the following assumptions:

 

		December 27, 2017
Exercise price			US $1.2625
Share price			US $0.97
Risk-free interest			2.22	%
Estimated life (in years)			5
Expected volatility			93.52	%

 

The total cost associated with the Broker Warrants amounted to and was recorded in contributed surplus.

 

 

Concurrent with the private placement described in Note on the Corporation closed a public offering (“Public Offering”) issuing units of Acasti (“Units”) at a price of per Unit for gross proceeds of Each Unit consists of class A share (Common Share) and half of class A or common share purchase warrant. Each whole warrant entitles the holder thereof to purchase common share at an exercise price of per common share, at any time until The Units issued as part of the public offering are considered equity instruments. The transaction costs associated with the Public Offering amounted to The proceeds and transaction costs were allocated to share capital.

 

As part of the transaction, the Corporation also issued broker warrants (the “Broker Warrants”) to purchase up to Common Shares. Each Broker Warrant entitles the holder thereof to acquire Common Share of the Corporation at an exercise price of per common share, at any time until The broker warrants are considered for compensation to non-employees under IFRS stock-based compensation, and are accounted for at fair value through contributed surplus. To determine the fair value of the Broker Warrants, the Black-Scholes pricing model was used. The total costs associated with the Broker Warrants amounted to and were allocated to share capital.

 

The warrants issued as part of the Units of the Public Offering and the broker warrants include an “Acceleration Right”, related to the Corporation’s right to accelerate the expiry date of the warrants. The Acceleration Right clause means the right of the Corporation to accelerate the expiry date to a date that is less than days following delivery of the acceleration notice if, at any time at least months after the effective date, the volume weighted average trading price of the common shares equals or exceeds for a period of consecutive trading days on the TSXV.

 

Furthermore, as part of the Public Offering and convertible debt transactions, a total of Common Shares were issued as equity settled share-based payments for services received from an employee of the previous parent at a price of per share for a total cost of The equity settled share-based payment costs have been allocated to share capital for a cost that amounted to and to debt for a cost that amounted to based on relative value.

 

The value of the broker warrants was estimated using a Black-Scholes option pricing model and based on the following assumptions:

 

		February 21, 2017
Exercise price		$	2.15
Share price		$	1.70
Dividend			-
Risk-free interest			0.79	%
Estimated life (in years)			1.00
Expected volatility			112.09	%

 

The total cost associated with the Broker Warrants amounted to and was recorded as contributed surplus.

 

 

The following table summarizes the shares issued to settle the payment of accrued interest on the unsecured convertible debentures with the corresponding amount recorded to share capital.

Accrued interest as at		Share issuance date		Number of shares				Amount $
March 31, 2017		April 7, 2017			9,496				17
June 30, 2017		August 15, 2017			23,885				40
September 30, 2017		December 27, 2017			22,783				40
December 31, 2017		March 27, 2018			33,605				40
March 31, 2018		June 6, 2018			30,348				40
June 30, 2018		August 21, 2018			51,807				40
September 30, 2018		October 31, 2018			23,723				40
					195,647				257

 

 

The warrants of the Corporation are composed of the following as at and

 

		March 31, 2019								March 31, 2018								March 31, 2017								February 28, 2017 (Unaudited)
		Number outstanding				Amount				Number outstanding				Amount				Number outstanding				Amount				Number outstanding				Amount
						$								$								$								$
Liability
May 2018 Public offering Warrants 2018 (i)			10,188,100				8,246				-				-				-				-				-				-
Series December 2017 US Public offering Warrants 2017 (ii)			9,801,861				8,017				9,802,935				6,405				-				-				-				-
Series 8 Public offering Warrants December 2013 (iii)			-				-				18,400,000				21				18,400,000				209				18,400,000				187
			19,989,961				16,263				28,202,935				6,426				18,400,000				209				18,400,000				187
Equity
Public offering warrants
Public offering broker warrants May 2018 (iv)			547,975				283				-				-				-				-				-				-
Public offering U.S. broker warrants December 2017 (v)			495,050				406				495,050				406				-				-				-				-
Public offering warrants February 2017 (vi)			1,904,034				-				1,904,034				-				1,965,259				-				1,965,259				-
Private Placement- contingent warrants
2017 unsecured convertible debenture conversion option and contingent warrants (vii)			1,052,630				309				1,052,630				309				1,052,630				309				1,052,630				309
Series 9 Private Placement warrants 2013 (viii)			-				-				161,654				-				161,654				-				161,654				-
Series 2017 BW Broker warrants (ix)			-				-				-				-				234,992				144				234,992				144
			3,999,689				998				3,613,368				715				3,414,535				453				3,414,535				453

 

 

Warrants exercise:

 

During the year warrants offered as part of the public offering were exercised at an exercise price of per Common Share of the Company, resulting in million of cash proceeds. In addition, warrants offered as part of the U.S. public offering were exercised in a cashless manner to acquire Common Shares of the Company.  A total of Common Shares were issued as a result of warrants being exercised. During the year ended warrants offered as part of the public offering were exercised at an exercise price of per Common Share of the Company, resulting in of cash proceeds.