EUPRAXIA PHARMACEUTICALS INC.

Preferred Shares

We may issue preferred shares from time to time in one or more series. The terms of each series of preferred shares, including the number of shares, the designation, rights, preferences, privileges, priorities, restrictions, conditions and limitations, will be determined at the time of creation of each such series by our Board, without shareholder approval, provided that all preferred shares will rank equally within their class as to dividends and distributions in the event of our dissolution, liquidation orwinding-up. The preferred shares are entitled to priority over the Common Shares with respect to the distribution of assets of the Company in the event of any liquidation, dissolution or winding up of the Company’s affairs, whether voluntary or involuntary. The preferred shares are only entitled to voting rights and dividends as provided in the special rights and restrictions attached to any particular series.

Series 1 Preferred Shares

The Series 1 Preferred Shares are convertible into Common Shares without additional consideration on aone-to-one basis, subject to customary anti-dilution protection for share splits, reorganizations and other customary conditions.

The Series 1 Preferred Shares are not initially entitled to any dividends. Following the third anniversary of closing of the Private Placement, and subject to shareholder approval, any unconverted Series 1 Preferred Shares will be entitled to a quarterly dividend equal to 1.5% (6% annually) of the original issue price, payable in additional Series 1 Preferred Shares (the “PIK Preferred Shares”). If shareholder approval for the PIK Preferred Shares is not obtained by the third anniversary of closing, the quarterly dividends will be paid in cash at a rate of 2% (8% annually). No dividends will be payable on Common Shares while any Series 1 Preferred Shares remain issued and outstanding.

The holders of Series 1 Preferred Shares are entitled to nominate one representative to the board of directors of the Company.