Quantum BioPharma closes fourth debenture tranche of $100,000, cancels director warrants

The debenture tranche

Quantum BioPharma Ltd. closed a fourth tranche of its debenture offering on March 6, 2025, issuing 100 Debenture Units for $100,000. The offering was announced on December 5, 2024 and amended on January 20, 2025. The release refers to the terms set out in those earlier releases and does not restate the interest rate, maturity or security of the debentures.

The company says it will use the proceeds for the ongoing development of its business model and for general working capital. It says further tranches may close with an increased conversion price of $6.60 and an increased exercise price of $7.00 per warrant share. Those higher figures are the only price terms for later tranches that the release gives.

The release names no placement agent, finder, underwriter, lender or counsel for the debentures. It says the securities have not been registered under the U.S. Securities Act of 1933 and may not be offered in the United States without registration or an exemption. The release does not say how many tranches have closed since March 2025 or how much has been raised in total.

The warrant cancellation and option grant

On March 7, 2025, the company cancelled an aggregate of 7,692 warrants to buy Class B subordinate voting shares. The warrants had been granted to Michael (Zappy) Zapolin, a member of the board. The company and Mr. Zapolin signed a warrant cancellation agreement, and management concluded the warrants "no longer represented a realistic incentive."

The company then granted Mr. Zapolin 7,692 stock options under its equity incentive plan. The options carry an exercise price of C$6.60 per Class B share and expire on March 7, 2027. The number of options matches the number of warrants cancelled. The release does not explain why the director received options in place of the warrants.

Because Mr. Zapolin is a director, the grant is a related-party transaction under Multilateral Instrument 61-101, the Canadian rule on minority shareholder protections. The board determined that the grant was exempt from the formal valuation and minority approval requirements. The company said it relies on exemptions in sections 5.5(a) and 5.7(1)(a) because the fair market value of the grant does not exceed 25% of its market capitalization. The release gives neither the fair market value nor the market capitalization behind that test.

The company and its finances

The company calls itself a biopharmaceutical company building a portfolio for neurodegenerative and metabolic disorders and alcohol misuse disorders. Its lead compound, Lucid-MS, is described as "shown to prevent and reverse myelin degradation" in preclinical models. The release also says Quantum spun out the over-the-counter version of unbuzzd to Celly Nutrition Corp., and that it held 25.71% of Celly Nutrition as of June 30, 2024. The royalty on unbuzzd sales is 7% until payments total $250 million, then 3%.

The 20-F filed March 26, 2026 reports year-end cash and cash equivalents of $1.9 million for 2025, down from $6.0 million at the end of 2024. Against that, the $100,000 tranche is small. Cash used in operations was $8.2 million for 2025, up from $6.9 million for 2024. Short-term investments were $459,080 at the end of 2025, down from $1.2 million a year earlier. The 20-F filed March 26, 2026 says the company believes it was a passive foreign investment company for 2025.

What comes next

The release says the company may close additional tranches on the higher terms. It sets no date for any further closing, and it does not say whether the warrant cancellation or the option grant affects the number of shares that could be issued. The filing was made in September 2026, but the release it contains is dated March 7, 2025.

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