NeonMind Announces $400,000 Non-Brokered Private Placement of Convertible Debenture Units
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THEUNITED STATES
NeonMind Announces $400,000 Non-Brokered Private Placement of ConvertibleDebenture Units
Oakville, Ont. – March 21, 2022: NeonMind Biosciences Inc. (CSE: NEON) (OTCQB: NMDBF) (FRA: 6UF)(“NeonMind'' or the “Company”), an integrated drug development and wellness company focused onbringing innovative psychedelic-based treatments to people suffering from obesity and mental healthdisorders, is pleased to announce a non-brokered private placement of units of convertible unsecureddebentures (the “Debentures”) and warrants (the “Warrants”) of the Company (the “Offering”) for up toC$400,000 in aggregate gross proceeds.
The Debentures will bear interest from the date of issue of the Debentures (the “Closing Date”) at a rateof 10% per annum on an accrual basis, calculated and payable semi-annually in arrears on May 31 andNovember 30 of each year commencing on May 31, 2022. Interest shall be calculated on the basis of a360 day year composed of twelve 30-day months. The first Interest payment period shall be calculatedfrom and including the Closing Date (as set out below) to, but excluding, May 31, 2022. All other interestpayment periods shall be calculated from and including the date of the latest interest payment date to,but excluding, the current interest payment date.
The principal amount of the Debentures will be convertible into common shares of the Company (the“Common Shares”), at the election of the holder of the Debentures, at a conversion price of C$0.075, ifconverted at any time before the the Redemption Date (the “Conversion Price”).
For each Unit subscribed, the subscriber will receive 9,500 Warrants to purchase common shares of theCompany. Each Warrant will entitle its holder to acquire one Common Share of the Company at a price ofC$0.08 (the “Exercise Price”) for a period of 36 months after the Closing Date.
The Conversion Price will be subject to standard anti-dilution provisions, including an adjustment to theConversion Price in certain events including, without limitation, the subdivision or consolidation of theoutstanding Common Shares, the issue of Common Shares or securities convertible into Common Sharesby way of stock dividend or distribution, a dividend or distribution paid to all or substantially all of theholders of Common Shares, the issue of rights, options or warrants to all or substantially all of theholders of Common Shares in certain circumstances, and the distribution to all or substantially all of the
holders of Common Shares or of any other class of shares, rights, options or warrants, evidences ofindebtedness or assets.
The Debentures will include events of default customary for a transaction of this type, including but notlimited to the following: (i) failure to pay interest or the principal amount when due, (ii) bankruptcy orinsolvency of the Company, or (iii) any default by the Company under other material indebtedness afterany applicable grace period has expired.
The Debentures, the Warrants and the Common Shares issued on conversion of the Debentures or theWarrants will be legended and subject to a four month hold period from the Closing Date in accordancewith applicable securities legislation. All amounts are in Canadian dollars. The
net proceeds from theOffering will be used for general and corporate working capital purposes.
The Units will be eligible investments for trusts governed by registered retirement savings plans,registered retirement income funds, registered education savings plans, registered disability savingsplans, tax-free savings accounts and certain deferred profit-sharing plans under the Income Tax Act(Canada).
At Closing, the Company will pay finders a fee being a cash commission of up to 7.0% of the aggregategross proceeds arising from the Offering (the “Commission”). Finders will also receive such number ofagent’s warrants to buy Shares that is equal to up to 7% of the principal divided by the conversion price,exercisable at the conversion price at any time up to 24 months following the Closing Date. Closing isexpected to occur on March 31, 2021.
This news release does not constitute an offer to sell or a solicitation of an offer to buy any of thesecurities in the United States. The securities have not been and will not be registered under the UnitedStates Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and maynot be offered or sold within the United States or to U.S. Persons unless registered under the U.S.Securities Act and applicable state securities laws or an exemption from such registration is available.
About NeonMind Biosciences Inc.
NeonMind operates two divisions: (i) a pharmaceutical division engaged in drug development ofpsychedelic compounds with two lead psilocybin-based drug candidates targeting obesity; and (ii) a
medical services division focused on launching specialty mental health clinics that integrate psychedelictherapeutics into traditional psychotherapy settings.
In its pharmaceutical division, NeonMind has two distinct psilocybin drug development programstargeting obesity. NeonMind's lead candidate, NEO-001, employs psilocybin as an agonist at theserotonin 5- HT2A receptor, which is involved in the hallucinogenic effect of psychedelics. The Company'ssecond drug candidate, NEO-002, employs low-dose psilocybin as an agonist at the 5-HT2C receptor,which controls appetite.
NeonMind and its strategic partners are building NeonMind-branded specialty mental health clinics inCanada that incorporate evidence-backed innovative treatments to address a variety of mental healthneeds. For more information on NeonMind, go to www.NeonMindBiosciences.com.
Rob Tessarolo, President & Chief Executive Officer, NeonMind Biosciences [email protected]: 416-750-3101
Investor Relations:KCSA Strategic CommunicationsScott Eckstein/Tim [email protected]: 212-896-1210
The Canadian Securities Exchange has not reviewed, approved nor disapproved the contents of this newsrelease.
Cautionary Statement Regarding Forward-Looking Statements
Certain statements contained in this press release constitute forward-looking information. Thesestatements relate to future events or NeonMind's future performance. The use of any of the words"could", "expect", "believe", "will", "projected","estimated" and similar expressions and statementsrelating to matters that are not historical facts are intended to identify forward-looking information andare based on NeonMind's current belief or assumptions as to the outcome and timing of such futureevents. Actual future results may differ materially. In particular, NeonMind's drug development plans, itsability to retain key personnel, and its expectation as to the development of its intellectual property andother steps in its preclinical and clinical drug development constitute forward-looking information. Actual
results and developments may differ materially from those contemplated by forward-lookinginformation. Readers are cautioned not to place undue reliance on forward-looking information. Thestatements made in this press release are made as of the date hereof. NeonMind disclaims any intentionor obligation to publicly update or revise any forward-looking information, whether as a result of newinformation, future events or otherwise, except as may be expressly required by applicable securitieslaws.