Item 1. Legal Proceedings
Item
1. Legal Proceedings.
On May 19, 2021, Alpha Capital Anstalt (“Alpha”)
filed a lawsuit in the New York State Supreme Court, Commercial Division, New York County against BriaCell Therapeutics Corp. (“BriaCell”),
alleging that BriaCell breached a loan contract when it refused to reprice and extend the term of warrants purported held by Alpha in
spring 2021, seeking monetary and injunctive relief for delivery of those amended warrants. Counterclaiming and defending against Alpha’s
complaint, BriaCell alleges that Alpha’s loan to BriaCell is unenforceable both because the loan is criminally usurious under New
York law and because Alpha acted as an unregistered securities dealer in violation of American securities law. BriaCell also has alleged
that Canadian securities law, regulation, and rules prohibited it from amending the warrants to comply with Alpha’s spring 2021
demands. On May 11, 2022, Alpha moved to dismiss BriaCell’s operative Amended Counterclaim. At oral argument on January 19, 2023, Justice Cohen granted in part and
denied in part Alpha’s partial motion to dismiss BriaCell’s Amended Counterclaim and Affirmative Defenses. In relevant part,
Justice Cohen refused to dismiss any of BriaCell’s substantive counterclaims, allowing BriaCell to continue to prosecute its Unjust
Enrichment, Money Had and Received, Recovery of Excess, and Implied Covenant of Good Faith and Fair Dealing claims against Alpha. At this
time, the parties cannot estimate the value of their respective claims and damages.
27
The
Company disagrees with Alpha’s claims, is defending these claims, and has filed a counter claim. At this time, whilst it is impossible
to provide any guarantee as to the outcome of the lawsuit, it is the Company’s assessment, based on advice from the Company’s
legal counsel at this time, and based on the information known by the Company, that it is more likely than not that BriaCell will not
have to pay Alpha in the litigation.
Item
1A. Risk Factors.
As
of the date of this Quarterly Report on Form 10-Q, there have been no material changes from the risk factors previously disclosed in
our Annual Report for the year ended July 31, 2022.
Item
2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
Item
3. Defaults Upon Senior Securities.
None.
Item
4. Mine Safety Disclosures.
Not
Applicable.
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