On May 15, 2025 Rakovina Therapeutics Inc. (TSX-V: RKV) (FSE: 7JO) ("Rakovina" or the "Company"), a biopharmaceutical company advancing innovative cancer therapies through artificial intelligence (AI)-powered drug discovery, reported a strategic financing of approximately $4 million (the "Offering") consisting of concurrent private placements of (i) convertible debenture units ("Debenture Units") for aggregate gross proceeds of approximately $1.1 million, and (ii) equity units ("Units" and, together with the Debenture Units, the "Offered Units") for aggregate gross proceeds of approximately $2.9 million (Press release, Rakovina Therapeutics, MAY 15, 2025, https://www.rakovinatherapeutics.com/rakovina-therapeutics-announces-strategic-private-placement-convertible-debt-financing-and-share-consolidation-to-accelerate-us-focused-growth-and-ai-powered-oncology-innovation-2/?utm_source=rss&utm_medium=rss&utm_campaign=rakovina-therapeutics-announces-strategic-private-placement-convertible-debt-financing-and-share-consolidation-to-accelerate-us-focused-growth-and-ai-powered-oncology-innovation-2 [SID1234653181]). The Offering is anchored by a $3 million indication of interest from strategic investors for $1.1 million of Debenture Units and $1.9 million of Units.

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The Company also announces that it will seek TSX Venture Exchange (the "TSXV") approval to implement a 10-for-1 share consolidation (the "Consolidation") to enhance its capital structure and position Rakovina for accelerated growth in U.S. capital markets, to be completed following closing of the Offering.

Offering

Pursuant to the Offering, Rakovina will issue approximately 58 million Units at an offering price of $0.05 per Unit, with each Unit consisting of one Pre-Consolidation Share (as defined herein) and one share purchase warrant (a "Warrant"). Each Warrant will entitle the holder to purchase one additional Pre-Consolidation Share at a price of $0.10 per Pre-Consolidation Share (or $1.00 per Post-Consolidation Share, following completion of the Consolidation), exercisable for a period of 24 months from issuance, subject to customary adjustments, including adjustment upon completion of the proposed Consolidation. If the closing price for the Company’s common shares on the TSXV is $0.25 or greater per Pre-Consolidation Share (or $2.50 per Post-Consolidation Share, following completion of the Consolidation) for five consecutive trading days, the expiry of the Warrants shall be accelerated to the date that is 30 days following the last day of the 5-day trading period.

Rakovina will also issue approximately 22 Debenture Units to a select group of investors at an offering price of $50,000 per Debenture Unit, for aggregate gross proceeds of approximately $1.1 million. Each Debenture Unit will be comprised of one unsecured convertible debenture (a "Debenture") in the principal amount of $50,000 and 100,000 share purchase warrants ("Debenture Warrants"). Each Debenture Warrant will entitle the holder to purchase one additional Pre-Consolidation Share at a price of $0.15 per Pre-Consolidation Share (or $1.50 per Post-Consolidation Share, following completion of the Consolidation), exercisable for a period of 24 months from issuance, subject to customary adjustments, including adjustment upon completion of the proposed Consolidation.

The principal amount of each Debenture shall be repayable in 36 months (unless earlier converted or redeemed) and will accrue interest at a rate of 12% per annum. Until the principal amount is repaid, a Debenture holder shall have the option to convert the principal amount of the Debenture into common shares of the Company at a conversion price of $0.10 per Pre-Consolidation Share (or $1.00 per Post-Consolidation Share, following completion of the Consolidation), subject to customary adjustments, including adjustment upon completion of the proposed Consolidation. Rakovina shall be entitled to redeem all or a portion of the principal amount of each Debenture at any time commencing 12 months after issuance of such Debenture, in cash and without premium.

The Offering may include one or more subscriptions by directors or other insiders of the Company. Subscriptions completed by insiders in the Offering may constitute a "related party transaction" as defined in Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101") and Policy 5.9 of the TSXV. The Company is relying on exemptions from the formal valuation and minority shareholder approval requirements under MI 61-101 on the basis that neither the fair market value of the Offered Units issued to interested parties (as defined in MI 61-101), nor the consideration received for those Offered Units, will exceed 25% of the Company’s market capitalization.

Closing of the Offering is subject to the Company obtaining all necessary corporate and regulatory approvals, including approval of the TSXV. Pursuant to applicable Canadian securities laws, all securities issued in connection with the Offering will be subject to a statutory hold period of four months plus a day from the date of issuance. The Company may pay finders’ fees in connection with the Offering and in accordance with the policies of the TSXV.

Share Consolidation

Subject to the approval of the TSXV, Rakovina will consolidate all of its issued and outstanding common shares on the basis of 10:1, with each 10 Pre-Consolidation Shares (as defined below) being consolidated into one Post-Consolidation Share (as defined below). In accordance with the Company’s articles, shareholder approval of the proposed Consolidation will not be required.

The 140,042,575 common shares currently issued and outstanding (the "Pre-Consolidation Shares") will be reduced to approximately 14,004,257 common shares on a post-Consolidation basis (the "Post-Consolidation Shares"), assuming no additional Pre-Consolidation Shares are issued prior to completion of the Consolidation. Assuming 58,000,000 Pre-Consolidation Shares are issued pursuant to the Offering, there will be approximately 19,804,257 Post-Consolidation Shares issued and outstanding upon completion of the Consolidation. No fractional shares will be issued as a result of the Consolidation. Any fractional interest in shares that would otherwise result from the Consolidation will be rounded down to the nearest whole share, if the fractional interest is less than one-half of a share, and rounded up to the nearest whole share, if the fractional interest is equal to or greater than one-half of a share. No cash consideration will be paid in respect of fractional shares. The Company will not be changing its name in connection with the Consolidation and the Post-Consolidation Shares will continue to trade on the TSXV under the existing trading symbol.

The exercise or conversion price, and the number of Post-Consolidation Shares issuable under any of the Company’s outstanding convertible securities, will be proportionately adjusted upon the effective date of the Consolidation.

The effective date of the Consolidation, and new CUSIP and ISIN numbers for the Post-Consolidation Shares, if applicable, will be disclosed in a subsequent news release.

"This is more than a financing, it’s a pivotal inflection point," said Jeffrey Bacha, Executive Chairman of Rakovina Therapeutics. "We’re not just adding capital, we’re building capacity. The share consolidation strengthens our market position, while the continued integration of an advanced AI platform accelerates our ability to monetize our pipeline through high-value collaborations."

Rakovina’s proprietary DNA Damage Response (DDR) platform continues to show promise in targeting tumors with impaired DNA repair pathways—a hallmark of many treatment-resistant cancers. With a stronger capital structure, strategic investment, and embedded AI expertise, the Company is well-positioned to deliver lasting value to patients, partners, and shareholders alike.