PsyLabs develops and produces certified pharmaceutical-grade nature-derived psychedelics for applications in mental health and well-being
Psyence Biomedical has issued common shares to Psyence Group pursuant to a debt-for-equity swap agreement
NEW YORK, Oct. 31, 2024 (GLOBE NEWSWIRE) — Psyence Group Inc. (“Psyence Group“) (CSE: PSYG) today announced the successful closing of its previously announced disposal of its 11.13% stake in privately held PsyLabs to its NASDAQ-listed associate, Psyence Biomedical Ltd (NASDAQ: PBM) (“PBM” or “Psyence Biomed“) (“Disposal“). Per the terms of the Disposal, Psyence Biomed will issue to Psyence Group 2,000,000 shares of its common stock.
PsyLabs is focused on the cultivation and production of psychedelic active pharmaceutical ingredients (APIs) and extracts for use in research, clinical trials and drug development. As previously announced, Psyence Biomed and PsyLabs have an existing strategic partnership whereby PsyLabs has granted Psyence Biomed a worldwide, exclusive, royalty-bearing IP licensing agreement to supply pharmaceutical-grade, EU GMP nature-derived (non-synthetic) psilocybin to be evaluated in future clinical trials as a potential treatment for Alcohol Use Disorder (AUD) and other Substance Use Disorders (SUDs) and for commercialization of the licensed product.
According to a new release issued by Psyence Biomed, Dr. Neil Maresky, Chief Executive Officer of Psyence Biomed said, “We are very pleased to have acquired a direct interest in PsyLabs through this acquisition and intend to capitalize on the benefits of being one of the world’s few vertically integrated developers of psychedelic-based regulatory-approved therapeutics.”
Debt-for-Equity Swap Agreement
Psyence Group and Psyence Biomed have entered into a debt-for-equity swap agreement (the “Debt Swap Agreement“), pursuant to which Psyence Biomed has agreed to issue 845,394 Psyence Biomed common shares at a deemed price of US$0.50 per common share to Psyence Group, in exchange for the discharging of the balance of the debt repayment obligation due under a promissory note, dated January 25, 2024, issued by Psyence Biomed to Psyence Group in connection with Psyence Biomed’s listing of its common shares on the NASDAQ in January 2024 (“Debt Swap“). In the event that the average VWAP of Psyence Biomed common shares for the ten trading days prior to January 15, 2025 is lower than US$0.50, Psyence Biomed will be required to make a “make whole payment” in cash or common shares, as set forth in the Debt Swap Agreement. Psyence Biomed has agreed to register the resale of the common shares within 60 days of the issuing of such common shares.
The Debt Swap Agreement contains customary representations, warranties and covenants of the parties. Psyence Group’s board of directors has, subject to the appropriate recusal of interested directors who are also directors of Psyence Biomed, approved the Debt Swap Agreement and no materially contrary view or abstention was expressed or made by any director in relation to the Debt Swap. Psyence Group will not file a material change report in respect of the Debt Swap at least 21 days before anticipated closing of the Debt Swap, as Psyence Group wishes to close on an expedited basis for sound business reasons.
