NEWS DETAIL

PharmaCielo Announces Closing of Overnight Marketed Equity Offering for Gross Proceeds of $13.5 Million

/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/

All figures are in Canadian dollars ($) unless otherwise specified

TORONTO and RIONEGRO, Colombia, April 7, 2021 /CNW/ - PharmaCielo Ltd. ("PharmaCielo" or the "Company") (TSXV: PCLO) (OTCQX: PCLOF), the Canadian parent of Colombia's premier cultivator and producer of medicinal-grade cannabis extracts, PharmaCielo Colombia Holdings S.A.S., is pleased to announce the closing of its previously announced overnight marketed offering (the "Offering") of common shares (the "Common Shares") from the treasury of the Company, for gross proceeds of $13,549,012, conducted through a syndicate of agents led by Cormark Securities Inc. and including Stifel GMP (together, the "Agents") inclusive of $50,000 from a non-brokered portion of the Offering. The Company granted the Agents an option to purchase an additional 840,698 Common Shares of the Common Shares sold in the Offering (the "Over-Allotment Option"). A portion of the Over-Allotment Option has been exercised and is reflected as part of the gross proceeds as the Offering.

Henning von Koss, CEO of PharmaCielo Ltd., commented, "The additional capital provided by the Offering puts PharmaCielo on solid footing to execute a focused strategic plan designed to leverage the Company's recently completed production facilities into results for shareholders. In the short-term, we are in the process of building a global sales organization through the addition of highly experienced technical business development professionals, with a mandate to close late-stage opportunities, grow our sales pipeline and shepherd potential customers from the introduction phase into testing and purchase. Alongside these concentrated sales initiatives, we will continue to invest in innovation, specifically to grow the Company's product offerings and formulation expertise, which we expect will translate into sustainable long-term shareholder value creation as global demand from sophisticated B2B consumers continues to grow over the next several years."

Each Common Share was issued at a price of $2.15. The Company intends to use the net proceeds from the Offering for growth initiatives and for general working capital purposes.

In satisfaction of a condition of the Offering, senior management and directors of the board of the Company have entered into a lock-up agreement for a period of 120 days from the date of closing prohibiting their disposition of securities of the Company subject to certain exceptions.

The Offering was conducted by way of a short form prospectus in each of British Columbia, Alberta, Ontario Quebec and Nova Scotia. A copy of the (final) short form prospectus is available under the Company's profile on the SEDAR website at www.sedar.com.

The Common Shares have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or under the securities laws of any state of the United States, and may not be offered, sold or delivered, directly or indirectly, to, or for the account or benefit of, persons in the United States or U.S. persons, except in transactions exempt from the registration requirements of the U.S. Securities Act and applicable state securities laws. This press release does not constitute an offer of such securities for sale, nor a solicitation for offers to buy such securities. "United States" and "U.S. person" are as defined in Regulation S under the U.S. Securities Act.

About PharmaCielo

PharmaCielo Ltd. (TSXV: PCLO, OTCQX: PCLOF) is a global company, headquartered in Canada, with a focus on ethical and sustainable processing and supplying of all natural, medicinal-grade cannabis oil extracts and related products to large channel distributors. PharmaCielo's principal (and wholly owned) subsidiary is PharmaCielo Colombia Holdings S.A.S., headquartered at its cultivation and processing centre located in Rionegro, Colombia.

The board of directors and executive team of PharmaCielo are comprised of a diversely talented group of international business executives and specialists with relevant and varied expertise. PharmaCielo recognized the significant role that Colombia's ideal location plays in building a sustainable business in the medical cannabis industry, and the Company, together with its directors and executives, is executing on a business plan focused on supplying the international marketplace.

Forward-Looking Statements

This press release contains forward-looking statements. Forward-looking statements can be identified by the use of words such as, "expects", "is expected", "intends", "believes", or variations of such words and phrases or state that certain actions, events or results "may" or "will" be taken, occur or be achieved. Forward-looking statements in this news release include, without limitation, statements with respect to, the use of proceeds of the Offering, the approval of the Offering by the TSXV, execution of the Company's business plan, the Company building out its sales organization and its sales pipeline, the Company investing in innovation and the Company growing its product offerings. The forward-looking statements in this news release are necessarily based on assumptions, including assumptions with respect to: PharmaCielo's ability to execute its business plan as currently contemplated, PharmaCielo's ability to obtain necessary regulatory approvals for the export of its products from Colombia and import of its products into other countries, that any changes to Colombian cannabis legislation will not negatively impact the Company's business, that the Company will be able to locate and retain necessary personnel to achieve its business goals and PharmaCielo's ability to maintain its distribution contracts in good standing. Though management believes that its assumptions are reasonable in the circumstances, the actual results, performance or achievements of PharmaCielo's business may be materially different from any future results, performance or achievements expressed or implied by any forward-looking statements herein. Forward-looking statements can be affected by known and unknown risks, uncertainties and other factors, including changes to PharmaCielo's development plans, the failure to obtain and maintain all necessary regulatory approvals relating to the export of cannabinoid products and the import of these products into other countries, TSXV approval, the inability to export or distribute commercial products through sales channels as anticipated due to economic or operational circumstances, risks associated with operating in Colombia, fluctuation of the market price for the Company's products, risks associated with global economic instability relating to COVID-19, risks related to retention of key Company personnel, currency exchange risk, competition in PharmaCielo's market and other risks discussed or referred to under the heading "Risk Factors" in PharmaCielo's Annual Information Form for the financial year ended December 31, 2019, which is available at www.sedar.com. Accordingly, readers should not place undue reliance on forward-looking statements. Except as required by law, PharmaCielo undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this press release.

SOURCE PharmaCielo Ltd.

For further information: Henning von Koss, CEO, +1 416-864-6116, PharmaCielo.com; Media Relations: International: Gal Wilder, Cohn & Wolfe, +1 416-602-4092, [email protected]; Colombia: Giselle Díaz Bermúdez, SPR Group, + 57 310 859 5468, [email protected]; Investor Inquiries: [email protected]

Related Links

http://www.pharmacielo.com