Mr. Blair McInnis reports

SPECTRAL MEDICAL INC. ANNOUNCES UPSIZING OF PREVIOUSLY ANNOUNCED BOUGHT DEAL CONVERTIBLE NOTE FINANCING TO C$5.5M

In connection with its previously announced bought deal private placement financing, Spectral Medical Inc. and Paradigm Capital Inc. (the underwriter), have agreed to increase the size of the offering. The company now intends to issue 9 per cent convertible notes of the company at a price of $1,000 (U.S.) per convertible note for total gross proceeds of approximately $5.5-million.

In addition, the company has granted the underwriter an option to sell up to that number of additional convertible notes equal to 15 per cent of the amended offering, which option shall be exercisable in whole or in part at any time, 48 hours prior to the closing date (as defined as follows).

The net proceeds from the amended offering are expected to be primarily used by the company on its phase III registration trial (Tigris) for its PMX treatment for endotoxemic septic shock and for general corporate and working capital purposes.

The amended offering is expected to close on or about Aug. 30, 2023, and will be subject to regulatory approvals and customary closing conditions, including listing of the common shares issuable upon conversion of the notes on the Toronto Stock Exchange.

About Spectral Medical Inc.

Spectral is a phase 3 company seeking U.S. Food and Drug Administration (FDA) approval for its unique product for the treatment of patients with septic shock, Toraymyxin (PMX). PMX is a therapeutic hemoperfusion device that removes endotoxin, which can cause sepsis, from the bloodstream and is guided by the company's endotoxin activity assay (EAA), the only FDA-cleared diagnostic for the risk of developing sepsis.

PMX is approved for therapeutic use in Japan and Europe and has been used safely and effectively on more than 340,000 patients to date. In March, 2009, Spectral obtained the exclusive development and commercial rights in the United States for PMX and, in November, 2010, signed an exclusive distribution agreement for this product in Canada. In July, 2022, the U.S. FDA granted breakthrough device designation for PMX for the treatment of endotoxemic septic shock. Approximately 330,000 patients are diagnosed with septic shock in North America each year.

Spectral is listed on the TSX under the symbol EDT.

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