PharmaCielo Ltd. — Capital/Financing Update 2021

Mar 4, 2021

PHARMACIELO LTD.

Terms and Conditions of Public Offering of Common Shares

March 3, 2021

A preliminary short form prospectus containing important information relating to the securities described in this document has been filed with the securities regulatory authorities in British Columbia, Alberta, Ontario and Quebec. The preliminary short form prospectus is still subject to completion or amendment. A copy of the preliminary short form prospectus is required to be delivered to any investor that received this document and expressed an interest in acquiring the securities. Copies of the preliminary short form prospectus may be obtained from Melisa Ohotski (office: 416.943.6414; email: mohotski@cormark.com).

There will not be any sale or any acceptance of an offer to buy the securities until a receipt for the final short form prospectus has been issued.

This document does not provide full disclosure of all material facts relating to the securities offered. Investors should read the preliminary short form prospectus, final short form prospectus and any amendment, for disclosure of those facts, especially risk factors relating to the securities offered, before making an investment decision.

(All amounts shown in C$)

Issuer:	PharmaCielo Ltd. (the “Company”).
Offering:	Overnight marketed treasury offering of common shares (the “Common
	Shares”) of the Company (the “Offering”).
Offering Price:	$[] per Common Share.
Size of Offering:	To be determined in the context of the market, subject to a minimum Offering
	of $10,000,000.
Over-Allotment Option:	The Agents shall have the option (the “Over-Allotment Option”) to arrange
	for sale up to an additional 15.0% of the Common Shares sold pursuant to the
	Offering from treasury on the same terms of the Offering at any time up to 30
	days following the Closing Date (as hereinafter defined), solely for market
	stabilization purposes and to cover over-allotments, if any.
Use of Proceeds:	The net proceeds of the Offering shall be used for growth initiatives and for
	general working capital purposes.
Offering Basis:	The Common Shares will be offered (i) by way of a short form prospectus to
	be filed in British Columbia, Alberta, Ontario and Quebec, pursuant to National
	Instrument 44-101 –Short Form Prospectus Distributions; (ii) in the United
	States on a private placement basis pursuant to an exemption from the
	registration requirements of the_United States Securities Act of 1933_, as
	amended, and applicable state securities laws; and (iii) in jurisdictions outside
	of Canada and the United States, as agreed to between the Company and
	Cormark Securities Inc., in each case in accordance with all applicable laws
	provided that no prospectus, registration statement or similar document is
	required to be filed in such jurisdiction and the Company will not be subject to
	any continuous disclosure requirements in any such jurisdiction.
Commission:	A cash commission equal to 5.0% of the aggregate gross proceeds of the
	Offering.
	Non-transferable compensation warrants exercisable at the Offering Price to
	acquire that number of Common Shares as is equal to 5.0% of the number of
	Common Shares sold pursuant to the Offering. The compensation warrants will
	be exercisable at the Offering Price for a period of 24 months following the
	Closing Date.
Eligibility:	The Common Shares will be eligible for Canadian RRSPs, RRIFs, DPSPs,
	RESPs and TFSAs.

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Standstill Period:

Listing:

Lead Agent: Closing:

The Company agrees not to issue any common shares or securities convertible into common shares for a period of 120 days from the closing of the Offering without the prior written consent of Cormark except in conjunction with: (i) the issuance of common shares in connection with the exercise of any currently outstanding options of the Company, (ii) the issuance of options to acquire common shares pursuant to the Company’s stock option plan, and the issuance of common shares in connection with the exercise of any such options, (iii) the issuance of awards (including but not limited to restricted share units and deferred share units) pursuant to the Company’s incentive award plan, and the issuance of Common Shares in connection with any such awards; (iv), any acquisition of shares or assets of arm’s length persons, (v) to satisfy any other current instruments or other contractual commitments outstanding prior to the date hereof, or (vi) in connection with any strategic transactions or investments between the Company and a third party, for a period ending 120 days after the Closing Date.

The Common Shares issued in connection with the Offering will be listed on the TSX Venture Exchange at the time of Closing, which listing shall be a condition of Closing (as hereinafter defined).

Cormark Securities Inc.

March 18, 2021 or such other date as the Agents and the Company may agree.

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