Psyence Group Enters into Debt-for-Equity Swap Agreement with its NASDAQ-Listed Associate, Psyence Biomedical | Psychedelic Invest

TORONTO, Oct. 14, 2024 (GLOBE NEWSWIRE) — Psyence Group Inc (“Psyence Group” or the “Company“) (CSE: PSYG) hereby announces that it has entered into a debt-for-equity swap agreement (the “Debt Swap Agreement“) with its NASDAQ-listed associate, Psyence Biomedical Ltd (NASDAQ: PBM) (“PBM” or “Psyence Biomed“), pursuant to which Psyence Biomed has agreed to issue to the Company 2,075,920 Psyence Biomed common shares at a deemed price of US$0.50 per common share, in exchange for the discharging of a portion of the debt repayment obligation due under a promissory note, dated January 25, 2024, issued by Psyence Biomed to the Company 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 allows the Company to improve its overall portfolio flexibility by acquiring readily tradable securities and enhancing liquidity. The acquisition of the publicly traded shares of PBM provides greater transparency and market valuation, helping to establish a clearer assessment of the investment’s worth.” said Jody Aufrichtig, Executive Chairman of the Company.

The Debt Swap Agreement contains customary representations, warranties and covenants of the parties. The Debt Swap will be a “related party transaction” pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101“). The Company is relying on exemptions from the formal valuation and minority shareholder approval requirements of MI 61-101 pursuant to sections 5.5(a) and 5.7(1)(a), respectively, on the basis that at the time the Debt Swap was agreed to, neither the fair market value of the loan amount discharged by the Company, nor the consideration to be received for by the Company for such discharge, exceeds 25% of the Company’s market capitalization. The Company’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. The Company 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 the Company wishes to close on an expedited basis for sound business reasons.

About Psyence Group and Psyence Biomed:

Psyence Group is a life science biotechnology company listed on the Canadian Securities Exchange (CSE: PSYG), with a focus on natural psychedelics. Psyence Biomed is the world’s first life science biotechnology company traded on the Nasdaq (NASDAQ: PBM) that is focused on the development of botanical (nature derived, or non-synthetic) psilocybin-based psychedelic medicines, and works with natural psilocybin products for the healing of psychological trauma and its mental health consequences in the context of palliative care. Our name “Psyence” combines the words psychedelic and science to affirm our commitment to producing psychedelic medicines developed through evidence-based research.

Informed by nature and guided by science, Psyence Group works to develop advanced natural psilocybin products for clinical research and development.

Learn more at www.psyence.com and on Twitter, Instagram and LinkedIn.

Learn more at www.psyencebiomed.com and on LinkedIn.