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POCML 4 Inc. Provides Further Details of Qualifying Transaction With MediPharm Labs Inc.

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distribution or dissemination directly, or indirectly, in whole or in part, in or into the United States.

TORONTO, May 31, 2018 (GLOBE NEWSWIRE) -- POCML 4 Inc. (TSXV:POCM) (“POCML”) is pleased to provide further details of its previously announced proposed business combination (the “Transaction”) with MediPharm Labs Inc. (“MediPharm”).  As previously announced, the Transaction will result in a reverse take-over of POCML by the shareholders of MediPharm and is intended to constitute the “Qualifying Transaction” of POCML as such term is defined in the policies of the TSX Venture Exchange (the “TSXV”).  Prior to the completion of the Transaction, POCML shall file articles of amendment to, amongst other matters, effect a consolidation of its common shares (the “POCML PreConsolidation Shares”) on the basis of one (1) “new” common share (a “POCML PostConsolidation Share”) for every two “old” POCML Pre‐Consolidation Shares then outstanding.  The Transaction is then expected to proceed by way of a three cornered amalgamation pursuant to which MediPharm shall amalgamate with a wholly‐owned subsidiary of POCML, and POCML will acquire all of the issued and outstanding Class A common shares of MediPharm (the “MediPharm Shares”), in exchange for POCML Post‐Consolidation Shares on the basis of 12.68 POCML Post‐Consolidation Shares for every one MediPharm Share issued and outstanding (the “Exchange Ratio”).

MediPharm will provide contract processing of cannabis to Canadian authorized licensed producers and appropriate international growers and supplies cGMP cannabis oil to qualified companies for sale under their own brand. In addition, MediPharm will supply raw materials and processing for the creation of ready-to-sell cannabis products.  Set forth below is certain summary financial information derived from the unaudited financial statements of MediPharm for the periods noted below: 

                  Description

Year Ended
December 31, 2016
Year Ended
December 31, 2017
  Revenue$NIL$NIL
  Expenses$133,936$837,749
  Net loss$133,936$837,749
    
  As at December
31, 2016
As at December
31, 2017
  Total Non-Current Assets$NIL$2,221,877
  Total Current Assets$262,185$3,720,715
  Total Liabilities$33,476$2,544,256
  Total Liabilities and Shareholders’ Equity$262,185$5,942,592

Upon completion of the Transaction, all directors and officers of POCML shall resign and be replaced by nominees of MediPharm. The board of directors of POCML following the Transaction (the “Resulting Issuer”) is expected to be comprised of Patrick McCutcheon, Keith Strachan, Christopher Hobbs, Maruf Raza, Miriam McDonald and a sixth director to be determined at a later date.  For biographical information concerning Messrs. McCutcheon, Strachan, Hobbs, Raza and Ms. McDonald, please refer to the press release of POCML dated May 15, 2018 available on SEDAR at www.sedar.com.

In addition, the previously announced brokered private placement (the “Offering”) to be completed by MediPharm prior the Transaction of up to 1,391,956 units (the “Units”) at a price of C$10.778 per Unit will now be subject to increase by an over-allotment option of up to a further 208,794 Units (the “Over-Allotment Option”).  The Over-Allotment Option may be exercised in whole or in part at the option of the co-lead agents, Canaccord Genuity Corp. and PowerOne Capital Markets Limited (the “Agents”).  Each Unit will consist of one MediPharm Share and one half of one share purchase warrant (each whole warrant a “Warrant”).   Each Warrant will entitle the holder thereof to acquire an additional MediPharm Share at a price of C$15.216 until the date that is 24 months following the completion of the Transaction, subject to customary anti‐ dilution provisions.  The Units will be exchanged for POCML Post‐Consolidation Shares and share purchase warrants based on the Exchange Ratio in connection with the Transaction with the result that the effective price paid per POCML Post‐Consolidation Share and one half of one share purchase warrant after giving effect to the Transaction is C$0.85, with each whole share purchase warrant entitling the holder to acquire an additional POCML Post‐Consolidation Share at C$1.20.  The Agents will receive a cash commission (the “Cash Commission”) equal to 7% of the gross proceeds raised in the Offering and such number of broker warrants (the “Broker Warrants”) that is equal to 7% of the number of Units sold, provided that no Cash Commission will be payable or Broker Warrants issuable for purchasers that are on MediPharm’s president’s list, up to maximum gross proceeds of C$4,000,000 generated from such purchasers.  Each Broker Warrant will be exercisable to acquire one Unit at a price of C$10.778 until the date which is 24 months following the completion of the Transaction, subject to customary anti‐dilution provisions.  The net proceeds from the Offering will be used to expand MediPharm’s business and for general corporate purposes.  

For further information regarding the Offering, please refer to the press release of POCML dated May 15, 2018 available on SEDAR at www.sedar.com.

Further Information

All information contained in this news release with respect to POCML and MediPharm was supplied by the parties respectively, for inclusion herein, without independent review by the other party, and each party and its directors and officers have relied on the other party for any information concerning the other party.

For further information regarding the Transaction, please contact:

David D’Onofrio, Chief Executive Officer, Chief Financial Officer, Secretary and Director, POCML 4 Inc.

Telephone:         (416) 643-3880
Email:                 ddonofrio@poweronecapital.com

Patrick McCutcheon, President, Chief Executive Officer and Director, MediPharm Labs Inc.

Telephone:         705-719-7425
Email:                 pmccutcheon@medipharmlabs.com

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 TSXV 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 TSXV NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSXV) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION:

This news release contains “forward-looking information” and “forward-looking statements” (collectively, “forward-looking statements”) within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this news release, forward-looking statements relate, among other things, to: the terms and conditions of the proposed Transaction and the terms and conditions of the proposed Offering. 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; and the delay or failure to receive 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. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this news release. Except as required by law, POCML and MediPharm assume no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change.

Thursday, May 31, 2018 - 15:49