P Squared Renewables Inc. Provides Update on Proposed Qualifying Transaction
Calgary, Alberta - TheNewswire - September 15, 2020 - P Squared Renewables Inc. (TSXV:PSQ.P) ("PSQ"), a Capital Pool Company ("CPC"), is pleased to provide an update on its previously announced proposal for a Qualifying Transaction (the "Proposed QT") with Universal Ibogaine Inc. ("UI"), a privately-held, arm's length party which intends to develop a network of centres for the treatment of drug and alcohol addiction.
PSQ's prior news release of June 2, 2020, noted that PSQ has entered into a letter of intent (the "LOI") with UI whereby PSQ will acquire 100% of UI by way of an exchange of PSQ common shares, on a 1 for 1 basis, and undertake a related business combination (the "Amalgamation").
Subject to the approval by the TSX Venture Exchange (the "TSXV"), the Amalgamation is to represent PSQ's required Qualifying Transaction pursuant to Policy 2.4 of the TSXV.
The Proposed QT and the related Prospectus Financing (as defined below) contemplated under the LOI were originally intended to be completed by July 31, 2020, and the parties recently agreed to amend the LOI to extend the contemplated closing date for the Proposed QT to October 31, 2020, or such other date as may be mutually agreed upon.
The current business of UI will become the ongoing business of the new combined entity which will result from the Amalgamation, and which is intended to be renamed Clear Sky Recovery Solutions Inc. (the "Resulting Issuer") or such other name that is acceptable to the Resulting Issuer and to applicable regulatory authorities.
It is expected that the Amalgamation will represent a Reverse-Take-Over transaction of PSQ by UI (the "RTO") as the existing shareholders of UI are expected to represent a majority of the Resultant Issuer.
PSQ's prior news release of June 2, 2020 should be referred to, as it contained relevant information related to the Proposed QT, including:
- highlights of the Proposed QT, including background on UI, the ClearSky Licensing Agreement, and its current business plans;
- the proposed Board of Directors of the Resulting Issuer;
- the proposed use of proceeds of the Prospectus Financing;
Update on PSQ Private Placement Bridge Financing
As noted in the news release of June 2, 2020, prior to the completion of the Proposed QT, PSQ intends to complete a non-brokered bridge financing ?private placement (the "PSQ Bridge Financing") to raise up to $200,000 through the issuance of up to 1,000,000 PSQ common shares at a price of $0.20 per share. The proceeds of the PSQ Bridge Financing will be used for working capital purposes and to fund various transaction costs related to completion of the Proposed QT.
To date, PSQ has closed on subscription agreements for the issuance of a total of 400,000 common share, resulting in proceeds to PSQ of $80,000.
Update on Status of the QT Financing
Pursuant to the LOI, it is intended that concurrent with the closing of the Proposed QT, PSQ will complete an equity financing, by way of a prospectus, to raise gross proceeds of $3 million and a maximum of up to $5 million (the "Prospectus Financing"). PSQ continues to be in discussions with a party which would act as its agent to undertake the Financing.
UI itself is currently in process of undertaking a private placement of its' common shares, with the goal of raising up to $2 million (the "UI Financing") by mid October, 2020. It is intended that the UI Financing would be in the form of an offering of $0.25 "Units", which would include one common share and one "Warrant", with each Warrant exercisable (with an annual escalating exercise price) for a period of 5 years after closing of the Proposed QT.
It is intended that the Prospectus Financing would be conducted on the same terms as the UI Financing, by also issuing Units at $0.25, except that the Units issuable under the Prospectus Financing would include a one-half share purchase Warrant. The $0.25 Unit price would become the deemed transaction price for the Proposed QT. Further, it is intended that the current UI Financing would constitute a "concurrent offering" for purposes of TSXV approval of the Proposed QT and the related Prospectus Financing.
It is anticipated that UI will have four primary shareholders (the "UI Primary Shareholders") at the time of closing of the Proposed QT, each of which are expected to hold less than 10% of the combined, pro forma outstanding common shares of the Resulting Issuer. These four parties have acquired UI common shares by way of transactions with UI related to UI's current primary assets, being the ClearSky Licensing Agreement, and a parcel of undeveloped land in Belize. These four UI Primary Shareholders, and their current country of residence, include:
Shayne Nyquvest (BC, Canada) - UI's Chairman
Dr. Alberto Sola (Mexico) - ClearSky shareholder, and ClearSky's CEO
Patrick Kroupa (New York, USA) - ClearSky shareholder
Laura Shapiro (Colorado, USA) - ClearSky shareholder
Additional information regarding the acquisition of UI's primary assets is to be disclosed in a future news release and in the Prospectus related to the intended Prospectus Financing and the related Proposed QT.
PSQ was incorporated in 2017 and listed on the TSXV (as a Capital Pool Company) on June 21, 2017 under the trading symbol "PSQ.P". Since its formation, PSQ has been searching for and evaluating suitable business combinations to constitute its "Qualifying Transaction" as such term is defined in the policies of the TSXV.
PSQ is a "reporting issuer" in the provinces of Alberta and British Columbia and currently has 11,560,850 common shares outstanding and options exercisable or exchangeable for a total of 950,000 common shares, exercisable at an exercise price of $0.10 per share.
About Universal Ibogaine Inc.
As noted in detail in PSQ's prior June 2, 2020 news release, UI is a privately held company formed in 2018 and based in Vancouver, BC. UI is in the initial stages of implementing and financing its business plan, which is to develop a network of global ibogaine assisted psycho-therapy clinics for the treatment and ideally the cure of addictions to primarily opioids, as well as alcohol, cocaine, heroin, fentanyl and other stimulants.
For its primary business focus, operating addiction treatment sites, UI has entered into a letter of intent to acquire an initial facility in west central Canada, and intends to close this acquisition in conjunction with closing of the Proposed QT. In addition, UI plans to submit a Clinical Trial Application to Health Canada to undertake clinical trials in Canada to prove the efficacy of the use of ibogaine, a natural substance, in the treatment of polysubstance addictions including opioids. In the longer term, UI plans to introduce ibogaine into the addiction treatment protocols to be used in its future facilities.
UI is also in process of final closing of the acquisition of a 20 acre property on an island near San Pedro, Belize. UI is reviewing the concept of having a joint venture partner finance and develop a potential future resort on this site.
Trading of PSQ's common shares
Trading in PSQ's common shares have been suspended since June 27, 2019 for failing to complete a Qualifying Transaction within 24 months of its listing and will remain suspended until the Proposed QT has been completed and the requisite approvals by the TSXV Venture Exchange (the "TSXV") have been obtained. The Proposed QT remains subject to approval by the TSXV.
All information contained in this news release with respect to PSQ and UI was supplied by the parties respectively, for inclusion herein, and each party and its directors and officers have relied on the other party for any information concerning the other party.
Completion of the Proposed QT is subject to a number of conditions, including but not limited to, TSXV acceptance and, if applicable, pursuant to the requirements of the TSXV, shareholder approval by a majority of the minority. There can be no assurance that the Proposed QT will be completed as proposed or at all.
PSQ will provide a subsequent news release at such future time as further information become available on the final details and status of the PSQ Bridge Financing, the terms of the Financing and other relevant developments.
Investors are cautioned that, except as disclosed in the Prospectus to be prepared in connection with the Financing and the related Proposed QT, any information released or received with respect to the transactions may not be accurate or complete and should not be relied upon. Trading in the securities of a CPC should be considered highly speculative.
The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this news release.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This news release includes certain "forward-looking statements" under applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to: the terms and conditions of the Proposed QT; the business plans of UI; the terms and conditions of the proposed Financing; the proposed Clinic Acquisition; the planned use of funds from the Financing; and the business and operations of the Resulting Issuer after the Proposed QT.
Words such as "will", "expects", "anticipates", "intends", "plans", "believes", "estimates", or similar expressions identify forward-looking statements. Such forward-looking statements reflect the current beliefs of management of PSQ and UI, based on information currently available to them.
Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; delay or failure to receive applicable Board, shareholder or regulatory approvals. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. These forward-looking statements are made as of the date hereof and PSQ disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws.
NOT FOR DISSEMINATION IN THE UNITED STATES
OR THROUGH U.S. NEWS WIRES
For further information regarding the Proposed QT, please contact:
Executive Chairman & CEO
P Squared Renewables
Universal Ibogaine Inc.