Satellos Bioscience Inc. Announces Filing of Final Short Form Prospectus for Proposed Offering of Common Shares

Toronto, Ontario--(Newsfile Corp. - May 10, 2023) - Satellos Bioscience Inc. (TSXV: MSCL) ("Satellos" or the "Company"), a regenerative medicine company aimed at developing therapeutics that change the way degenerative muscle diseases are treated, is pleased to announce today that it has filed its final short form prospectus (the "Prospectus") with the securities regulatory authorities in the Provinces of British Columbia, Alberta and Ontario in connection with the Company's previously announced public offering of common shares of the Company ("Common Shares") (or pre-funded common share purchase warrants ("Pre-Funded Warrants" and, together with the Common Shares, the "Securities") of the Company in lieu of Common Shares) (the "Offering").

The Offering is being conducted on a commercially reasonable "best efforts" agency basis at a price of $0.50 per Common Share (or $0.49999 per Pre-Funded Warrant), for minimum gross proceeds of $25,000,000 and maximum gross proceeds of $55,000,000. Each Pre-Funded Warrant issued in lieu of a Common Share at the election of any purchaser entitles the holder thereof to acquire one common share (a "Warrant Share") at a nominal exercise price of $0.00001 and the Pre-Funded Warrants will not expire.

The Offering will be conducted pursuant to the terms and conditions of an agency agreement that has been entered into between the Company and Bloom Burton Securities Inc. (the "Agent").

The completion of the Offering may occur in one or more separate closings on one or more dates (each, a "Closing Date") as the Company and the Agent may agree. It is expected that the initial closing will occur on or about May 15, 2023, or such other date as may be mutually agreed to by the Company and the Agent. There can be no assurance as to whether or when the Offering may be completed, or as to the actual size of the Offering. The TSX Venture Exchange ("TSXV") has conditionally approved the listing of the Common Shares, the Warrant Shares and common shares underlying the Compensation Options (as defined below). Listing will be subject to the Company fulfilling all of the TSXV's listing requirements.

The Company intends to use the net proceeds from the Offering to advance its lead program for the discovery and development of a small molecule drug for the treatment of Duchenne muscular dystrophy and to advance its drug candidate by conducting the prescribed series of preclinical studies and CMC activities to support an investigational new drug or clinical trial application for submission to the U.S. Food and Drug Administration and Health Canada, as well as working capital needs and other general corporate purposes.

The Company will pay to the Agent a cash fee equal to 7.0% of the gross proceeds raised under the Offering, and grant the Agent compensation options equal to 7.0% of the aggregate number of Securities issued under the Offering (the "Compensation Options"), provided however that the Company will not be required to pay commission in connection with sales to certain president's list purchasers. Each Compensation Option shall entitle the Agent to buy one Common Share at the same price per Common Share as under the Offering. The Compensation Options shall be exercisable until that date which is 24 months following the initial Closing Date.

A copy of the Prospectus, which contains important information relating to the Offering, is available on the Company's SEDAR profile at www.sedar.com.

In addition, the Securities are anticipated to be offered by way of private placement in certain jurisdictions outside of Canada pursuant to and in compliance with applicable securities laws.

This press release is not an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to qualification or registration under the securities laws of such jurisdiction. The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), and such securities may not be offered or sold to, or for the account or benefit of, persons in the United States or U.S. persons absent registration or an applicable exemption from U.S. registration requirements. "United States" and "U.S. persons" have the meanings ascribed to them in Regulation S under the U.S. Securities Act.

About Satellos Bioscience Inc.

Satellos is a biotechnology company dedicated to developing life-changing medicines to treat degenerative muscle conditions. The Company's scientific founder, Dr. Michael Rudnicki, is a thought leader who discovered and has shown how muscle stem cells regulate muscle repair and growth throughout life. He has shown how defects in a process known as stem cell "polarity", which controls how muscle stem cells divide to create muscle progenitor cells, lead to a failure of muscle regeneration in Duchenne and potentially other muscle disorders. As a result of this ongoing inability to produce sufficient numbers of new muscle cells, the muscles of people living with Duchenne are unable to keep up with and repair the continuous and accumulating damage their muscles experience. Accordingly, Satellos asserts that this ongoing dysfunction in the normal process of stem cell polarity in response to muscle damage represents a previously unrecognized root cause of Duchenne. The goal of correcting polarity is to restore the body's innate ability to regenerate muscle in response to the ongoing damage experienced by people living with Duchenne. The Company's lead program is focused on developing an oral therapeutic drug (i.e., a pill) intended to correct muscle stem cell polarity and restore the body's innate muscle repair and regeneration process. We believe our unique therapeutic approach represents a potential disease modifying treatment for Duchenne and other dystrophies, offering new hope to patients. To expand our programs to other degenerative muscle conditions or disorders, Satellos has created a proprietary discovery platform, MyoReGenXTM, which we utilize to identify disease situations where deficits in muscle stem cell polarity and regeneration occur and are amenable to therapeutic treatment. For more information about or to discuss potential collaborations with Satellos concerning our discovery platform and therapeutic candidates or our subsidiary Amphotericin B Technologies Inc., please contact Ryan Mitchell, PhD, Director - Business Development at rmitchell@satellos.com or visit Satellos.com.

CONTACT:
Communications at Satellos Bioscience Inc.
Christina Cameron
ccameron@satellos.com
647.660.1780

Notice on forward-looking statements:

This press release includes forward-looking information or forward-looking statements within the meaning of applicable securities laws regarding Satellos and its business, which may include, but are not limited to, statements with respect to the anticipated terms and jurisdictions of the Offering; securities offered thereunder; the timing of the Offering, including the anticipated Closing Date; use of proceeds from the Offering; fees anticipated to be paid to the Agent and terms thereof; regulatory and exchange approvals; general benefits of modulating stem cell polarity; its prospective impact on Duchenne patients and muscle regeneration generally; and Satellos' technologies and drug development plans. All statements that are, or information which is, not historical facts, including without limitation, statements regarding future estimates, plans, programs, forecasts, projections, objectives, assumptions, expectations or beliefs of future performance, are "forward-looking information or statements". Often but not always, forward-looking information or statements can be identified by the use of words such as "shall", "intends", "anticipate", "believe", "plan", "expect", "intend", "estimate" "anticipate" or any variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "might", "can", "could", "would" or "will" be taken, occur, lead to, result in, or, be achieved. Such statements are based on the current expectations and views of future events of the management of the Company. They are based on assumptions and subject to risks and uncertainties. Although management believes that the assumptions underlying these statements are reasonable, they may prove to be incorrect. The forward-looking events and circumstances discussed in this release, may not occur and could differ materially as a result of known and unknown risk factors and uncertainties affecting the Company, including, without limitation, those listed in the "Risk Factors" section of the Prospectus dated May 9, 2023 and the Annual Information Form dated April 27, 2023 (both of which are on the Company's profile at www.sedar.com). Although Satellos has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Accordingly, readers should not place undue reliance on any forward-looking statements or information. No forward-looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and Satellos does not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

No regulatory authority has approved or disapproved the content of this press release. Neither the TSX Venture Exchange nor its Regulatory Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

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