Dr. William Williams reports

BRIACELL ENTERS DEFINITIVE ARRANGEMENT AGREEMENT FOR THE SPIN OUT OF BRIAPRO THERAPEUTICS CORP.

Briacell Therapeutics Corp. has entered into an arrangement agreement dated May 24, 2023, with BriaPro Therapeutics Corp. (SpinCo), a wholly owned subsidiary of the company, pursuant to which certain preclinical pipeline assets of the company, including Bria-TILsRx and protein kinase C-delta (PKC-delta) inhibitors for multiple indications, including cancer, will be spun out to SpinCo by way of a court-approved statutory plan of arrangement under the Business Corporations Act (British Columbia).

"As we focus our efforts on the upcoming pivotal study of our lead clinical candidate, Bria-IMT, in advanced metastatic breast cancer, we believe that this strategy of spinning out certain preclinical immunotherapies in a separate entity of BriaPro Therapeutics Corp. will position them for success and will create our shareholders value over the long term," stated Dr. William V. Williams, Briacell's president and chief executive officer. "We continue with our mission to develop novel immunotherapies to fight cancer and improve patients' lives whose medical needs are currently unmet."

Pursuant to the arrangement agreement, SpinCo will acquire the entire right and interest in and to the SpinCo assets in consideration for the issuance by SpinCo to the company of SpinCo common shares. Under the terms of the arrangement, for each Briacell share held immediately prior to closing, Briacell shareholders will receive one common share of SpinCo and one new common share of Briacell having the same terms and characteristics as the existing Briacell common shares. SpinCo shares issued to Briacell shareholders will, in aggregate, represent 33.33-per-cent ownership of SpinCo shares upon closing of the arrangement, with Briacell initially retaining a 66.67-per-cent ownership interest in SpinCo. Briacell shareholders who receive SpinCo shares will ultimately own shares in both companies: Briacell, which will continue with its mission to develop targeted immunotherapies for cancer, and SpinCo, which will focus on the development of the SpinCo assets.

Under the terms of the arrangement, existing holders of Briacell warrants shall receive upon exercise of each Briacell warrant, for the original exercise price: one Briacell common share and one SpinCo share for each Briacell common share that was issuable upon exercise of the Briacell warrant.

Following the arrangement, Briacell will remain listed on both the Nasdaq Capital Market and Toronto Stock Exchange, and SpinCo will become an unlisted reporting issuer in Canada.

About the SpinCo assets

PKC-delta inhibitor: therapeutics for multiple disease indications, including cancer

PKC-delta, also called novel PKC, has been associated with a number of diseases, including cancer. Selective inhibitors of PKC-delta, have been shown to be effective treatments for several animal models of cancer and other diseases. SpinCo's novel and highly selective PKC-delta inhibitors may be developed as candidates for multiple disease indications, including several tumour types.

Bria-TILsRx: multispecific binding reagents -- immunotherapies for cancer

Developed as potential immunotherapies for cancer, SpinCo's two novel Bria-TILsRxs are multispecific binding reagents designed to act as potent immune cell activators and/or immune checkpoint inhibitors. They are expected to selectively target and destroy cancer cells without harming normal (non-cancerous) cells. This may mean less severe side effects for the treated cancer patients compared with those of alternative therapies.

Briacell director approval and recommendation; fairness opinion

The board of directors of Briacell unanimously (a) determined that the arrangement is in the best interests of Briacell and fair, from a financial point of view, to shareholders; (b) approved the arrangement and the arrangement agreement; and (c) recommend that shareholders vote in favour of the arrangement at the special shareholder meeting described below.

In determining to support the arrangement, the Briacell board relied in part on the opinion of BDO Canada LLP that the consideration to be received by Briacell shareholders under the arrangement is fair, from a financial point of view, to shareholders. It is anticipated that a written fairness opinion, which will describe the assumptions made, factors and other material background information considered, and limitations and qualifications on the review undertaken, will be included in the Briacell management information circular described below.

Briacell shareholder meeting and court approvals

The arrangement requires approval by Briacell shareholders at a special meeting of shareholders expected to be held in July, 2023. Approval of the arrangement must be obtained by a special resolution passed by a majority of not less than two-thirds of the votes cast by Briacell shareholders who vote in respect of the resolution. A management information circular with details of the arrangement will be made available to shareholders through Briacell's issuer profile on the System for Electronic Document Analysis and Retrieval (SEDAR) website and the Electronic Data Gathering, Analysis, and Retrieval system (EDGAR) website.

The arrangement must also be approved by the Supreme Court of British Columbia. An interim order of the court will be applied for to prescribe certain procedural matters relating to the special meeting of shareholders, followed by an application for a final order to approve the arrangement after the special meeting of shareholders.

Subject to the satisfaction of all conditions to closing set out in the arrangement agreement, it is anticipated that the arrangement will be completed by August, 2023. Conditions to closing include, inter alia, shareholder approval, required court orders, and TSX and NASDAQ approvals.

Arrangement agreement

The arrangement agreement contains customary terms, representations and warranties, covenants, conditions, and termination provisions for a transaction of this type. The mechanics of the arrangement are contained in the plan of arrangement attached as a schedule to the arrangement agreement.

Bennett Jones LLP is acting as Canadian legal adviser to the company. Sichenzia Ross Ference LLP is acting as U.S. legal adviser to the company.

About Briacell Therapeutics Corp.

Briacell is an immuno-oncology-focused biotechnology company developing targeted and effective approaches for the management of cancer.

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