Tickers: XTSX:PSQ.P
Tags: #AlternativeEnergy
November 1 2019 - Calgary, Alberta - TheNewswire - P Squared Renewables Inc. (TSXV: PSQ.P) ("P Squared" or "PSQ") is pleased to announce that it has entered into a binding letter agreement ("Letter Agreement") dated October 30, 2019 with Universal Ibogaine Inc. ("UI") which sets out the terms and conditions of the proposed transaction whereby P Squared Renewables Inc. ("PSQ") will acquire 100% of the issued and outstanding shares of Universal Ibogaine Inc. ("UI" and together with PSQ, the "Parties") pursuant to a "three-cornered amalgamation" involving PSQ, a subsidiary of PSQ incorporated for this purpose and UI (the "Amalgamation") which shall constitute PSQ's qualifying transaction (the "Qualifying Transaction" or "QT") pursuant to TSX Venture Exchange (the "Exchange" or "TSXV") Policy 2.4 - Capital Pool Companies ("Exchange Policy 2.4"). The parties to the Qualifying Transaction are at arm's length.
This letter agreement will govern the terms of the amalgamation pending preparation of a definitive agreement ??(the "Definitive Agreement") between the parties hereto setting forth the detailed terms of the ?Amalgamation and containing the terms and conditions set out in this Letter Agreement and such other ?terms and conditions as are customary for transactions of the nature and magnitude contemplated ?herein. All documentation shall be in form and content satisfactory to each of PSQ and UI.
Background
UI is a private company incorporated under the laws of the Province of British Columbia. UI is in the business of establishing centres for the treatment of addiction utilizing a ?technology developed by Clear Sky Recovery Cancun SA de CV ("Clearsky"). Under an agreement dated March 3, 2019 UI has the right to acquire the exclusive world-wide rights (subject to the rights of Clearsky to utilize the technology at its existing facility in Cancun, Mexico) to utilize the ?technology developed by Clearsky (the "Clearsky Technology"). Clearsky has successfully ?operated a treatment centre in Cancun, Mexico for 7 years where they have treated 3500 ?patients utilizing the Clearsky Technology. UI has also entered into a property purchase ?Agreement (the "Property Purchase Agreement") for its purchase of an ?Island property in Belize.
UI is presently undertaking a private placement for proceeds of $1 million by way of the sale of 10 million shares at the price of $0.10 per share.
Upon completion of the QT, UI will open a medically based, clinically-managed, state-of-the-art ibogaine treatment clinic in the Czech Republic that will employ the Clearsky Technology (the "Clinic").
PSQ is a public company incorporated in the Province of Alberta, is a reporting issuer in British Columbia and Alberta and is designated as a capital pool company pursuant to Exchange Policy 2.4. PSQ is currently suspended from trading pending classification of its CPC status.?
Terms of the Transaction and Ancillary Matters
PSQ and UI will enter into the "Transaction" comprised of a business combination by way of triangular amalgamation of a wholly-owned subsidiary of PSQ incorporated in British Columbia with UI to form a newly amalgamated entity which will become a wholly-owned subsidiary of PSQ ("Amalco Sub"). The parties agree, however, that the final structure of the business combination will be determined following receipt of tax, corporate and securities law advice for PSQ and UI.
PSQ, as it exists upon completion of the Transaction (referred to herein as the "Resulting ?Issuer"), will change its name to "Clearsky Solutionz Inc.", or such other name as ?agreed to by the parties, effective upon completion of the Transaction and will amalgamate ?with Amalco Sub shortly thereafter.?
Qualifying Transaction
P Squared has entered into the Letter Agreement with UI which sets out the material terms and conditions of the acquisition by P Squared of all issued and outstanding common shares of UI (the "UI Shares"), resulting in a merger of UI and P Squared. A total of 130 million common shares of P Squared are to be issued in exchange for the 130 million UI Shares issued outstanding, being an exchange ratio of 1 common shares of PSQ for each UI Share. Following the completion of the Transaction, and prior to giving effect to the Prospectus Offering (see "Prospectus Offering" below), 11.2 million common shares of P Squared will be issued and outstanding. The Letter Agreement also includes covenants in respect of the conduct of business and changes in capital structure by each of P Squared and UI prior to the completion of the Transaction. Under the Letter Agreement, the resulting board of directors will consist of six directors, four to be nominated by UI and two to be nominated by P Squared.
The Letter Agreement is to be superseded by a definitive share exchange agreement (the "Definitive Agreement"). It is intended that the Transaction will be completed by the end of January, 2020 and, in any event, no later than April 30, 2020 (or such other date as may be mutually agreed in writing between P Squared and UI). The Transaction is subject to the completion by P Squared of a prospectus offering for minimum proceeds of $2 million (see "Prospectus Offering" below), obtaining requisite regulatory approval, including the acceptance of the TSXV and the satisfaction or waiver of customary closing conditions, including the approval of the directors of P Squared of the Transaction and the completion of due diligence investigations to the satisfaction of P Squared, as well as the conditions described below. The legal structure for the Transaction will be confirmed after the parties have considered all applicable tax, securities law and accounting efficiencies, however, it is currently contemplated that the transaction will be structured as a securities exchange.
It is not anticipated that the Qualifying Transaction will be subject to the approval of the shareholders of P Squared. Certain of the common shares issuable pursuant to the Transaction will be subject to the escrow requirements of the TSXV or hold periods.
Prospectus Offering
Concurrent with the closing of the Proposed Transaction, P Squared will complete a prospectus offering of ?units (each, a "Unit") at a price of $0.25 per Unit, with each Unit ?consisting of one common ?share and one share purchase warrant with each warrant exercisable to ?purchase an ?additional common share for a period of 5 years at an exercise price of $0.50 if ??exercised in the first year, $0.75 if exercised in the second year, $1.00 if exercised in ?the third ?year, $1.25 if exercised in the fourth year, and $1.50 if exercised in the fifth ?year? ("Prospectus Offering") for a minimum gross proceeds of $2 million. The proceeds of the Prospectus Offering will be sufficient to satisfy the requirements of the TSXV in connection with P Squared's application for acceptance of the Transaction as its Qualifying Transaction. The proceeds of the Financing will be used to fund the opening of the Clinic in the Czech Republic, maintenance of the Belize property and for general corporate purposes. The Czech Republic clinic will be a medically based, clinically-managed, state of the art ibogaine treatment clinic that will provide a safe, effective and gentle detoxification from a variety of addictive drugs. The clinic will also provide comprehensive pre-care and after-care services.
Sponsorship
Sponsorship of a qualifying transaction of a capital pool company is required by the TSXV unless exempt in accordance with TSXV Policies. P Squared is currently reviewing the requirements for sponsorship and may apply for an exemption from the sponsorship requirements pursuant to the policies of the TSXV,, however, there is no assurance that P Squared will ultimately obtain this exemption. P Squared intends to include any additional information regarding sponsorship in a subsequent press release.
About P Squared
P Squared is a Capital Pool Company under TSXV Policy 2.4. It was incorporated under the provisions of the Business Corporations Act (Alberta) on March 10, 2017. P Squared was listed on the TSXV on June 21, 2017 under the trading symbol "PSQ.P". P Squared has approximately 11,200,000 common shares ("P Squared Shares") outstanding and options exercisable or exchangeable for an aggregate of 1,100,000 P Squared Shares at an exercise price of $0.10 per P Squared Share. It is a capital pool company and intends for the Transaction to constitute its "Qualifying Transaction" as such term is defined in the policies of the TSXV. P Squared is a "reporting issuer" in the provinces of Alberta and British Columbia.
Trading in the P Squared Shares
PSQ is currently suspended from trading pending classification of its CPC status.? Trading in the PSQ Shares will remain halted pending the review of the Transaction by the TSXV. There can be no assurance that trading in the PSQ Shares will resume prior to the completion of the Transaction.
Further Information
A comprehensive news release with further particulars relating to the Transaction, the Private Placement, the financial particulars of each of UI and PSQ and the Resulting Issuer, will follow in accordance with the Policies of the TSXV.
All information contained in this news release with respect to P Squared 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 Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and, if applicable, pursuant to the requirements of the TSXV, majority of the minority shareholder approval. Where applicable, the Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the transaction, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company 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 press 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 Transaction; the business plans of UI; the terms and conditions of the proposed Private Placement; the Proposed Prospectus Offering; use of funds; and the business and operations of the Resulting Issuer after the proposed transaction. 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 and 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 P Squared 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.
For further information regarding the Transaction, please contact:
Shabir Premji, Executive Chair, P Squared Renewables
Telephone: (403) 870-1841
Email: spremji@p2renewables.com
NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH U.S. NEWS WIRES
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