CervoMed Announces Up to $149.4 Million Private Placement Financing Joined by Leading Healthcare Investors

Funding from new investors, including RA Capital Management, Armistice Capital, Special Situations Funds and Soleus Capital

$50 million financing upfront with up to an additional $99.4 million tied to exercise of warrants

Pro forma cash and cash equivalents from upfront proceeds expected to provide runway through the end of 2025

BOSTON, March 28, 2024 (GLOBE NEWSWIRE) -- CervoMed Inc. (NASDAQ: CRVO), a clinical-stage company focused on developing treatments for age-related neurologic disorders (the “Company”), today announced that it has entered into a definitive securities purchase agreement for a private placement to sell an aggregate of 2,532,285 units (the “Units”), each Unit comprised of (i) (A) one share of its common stock or (B) one pre-funded warrant to purchase shares of its common stock, and in each case, (ii) one Series A warrant to purchase shares of its common stock to a select group of institutional and accredited healthcare specialist investors in a private placement. A Unit comprised of one share of common stock and one Series A warrant shall have a purchase price of $19.745 and a Unit comprised of one pre-funded warrant and one Series A warrant shall have a purchase price of $19.744.

The pre-funded warrants have an exercise price of $0.001 per share, will be immediately exercisable and will not expire. The Series A warrants have an exercise price of $39.24 per share, representing a 100% premium to the last sale, will be immediately exercisable, and will expire at the earlier of (i) April 1, 2027 or (ii) 180 days after the date that the Company makes a public announcement of positive top-line data from the Company’s Phase 2b RewinD-LB clinical trial evaluating neflamapimod for treatment of patients with dementia with Lewy bodies (“DLB”).

The Company anticipates the possible gross proceeds from the private placement to be approximately $50 million, before deducting any offering-related fees and expenses, and up to an additional approximately $99.4 million in gross proceeds if the Series A warrants are fully exercised for cash. The private placement is expected to close on or about April 1, 2024, subject to customary closing conditions.

The financing is being led by RA Capital Management and includes participation from other new institutional investors, including Armistice Capital, Special Situations Funds and Soleus Capital.

Morgan Stanley and Canaccord Genuity are acting as placement agents for the private placement. Brookline Capital Markets, a division of Arcadia Securities, LLC, is acting as a financial advisor to the Company.