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CALGARY, AB, November 10, 2020 - MagicMed Industries Inc. (CSE: MGIC reserved)("MagicMed" or the "Company") is pleased to announce a proposed offering of up to 5,000,000 units of the Company (the “Units”) at an offering price of $0.50 per Unit (the “Issue Price”), for aggregate gross proceeds of up to $2,500,000 (the “Offering”). The Units will be offered by means of private placement on a commercially reasonable best efforts basis by Gravitas Securities Inc. acting as lead agent and sole bookrunner (the “Agent”).
Each Unit will be comprised of one (1) common share in the capital of the Company (a “Common Share”) and one-half of one (1/2) Common Share purchase warrant (each whole warrant, a “Warrant”). Each Warrant will entitle the holder thereof to purchase one Common Share, at an exercise price of $0.75 (the “Exercise Price”) for a period of two (2) years from the date of a liquidity event resulting in the common shares of the Company becoming listed for trading on the Canadian Securities Exchange (the “CSE”), TSX Venture Exchange, Toronto Stock Exchange or any other stock exchange as may be agreed by the Company and the Agent (the “Liquidity Event”).
The Company has agreed to grant the Agent an over-allotment option (the “Over-Allotment Option”) to purchase up to an additional 20% of the Units at the Issue Price, exercisable in whole or in part, at any time up to two days prior to the closing of the Offering. If this option is exercised in full, the Company will receive an additional $500,000 in gross proceeds for total aggregate gross proceeds of $3,000,000.
In connection with the Offering the Company has agreed to pay the Agent a cash fee of 8% of the aggregate gross proceeds raised from the Offering, and non-transferable broker warrants (“Broker Warrants”) equal to 8% of the aggregate number of Units issued under the Offering. Each Broker Warrant will entitle the holder to acquire one (1) Unit of the Company at any time for a period of two (2) years from the date of a Liquidity Event at an exercise price equal to the Issue Price. Each whole Warrant underlying each Unit acquired upon exercise of a Broker Warrant shall be exercisable for a period of two (2) years from the date of issuance of such Warrant to acquire one (1) additional Common Share at the Exercise Price.
Following the completion of the Offering, MagicMed intends to file a non-offering prospectus with certain Canadian securities regulatory authorities and apply to list on the CSE. MagicMed has reserved the ticker symbol “MGIC” in connection therewith.
The Company intends to use the net proceeds of the Offering for the development of the PsybraryTM, capital expenditures, and general corporate purposes.
The closing date of the Offering is scheduled to be the week of November 30, 2020 or such other date as the Agent and the Company may agree (the “Closing Date”) and may be closed in one or more tranches.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful. The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933 (the “U.S. Securities Act”), as amended, or any state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws.
MagicMed Industries intends to partner with pharmaceutical and other companies to develop psychedelic-derived medicinal and licit consumer goods products. MagicMed's molecular derivatives library, the PsybraryTM is anticipated to be an essential building block from which industry can develop new patented products. The initial focus of the PsybraryTM is on psilocybin, which is expected to be opportunistically expanded to other psychedelics like MDMA, ketamine, ibogaine, mescaline, and ayahuasca.
MagicMed Industries Inc.
On Behalf of the Board
Dr. Joseph Tucker
Chief Executive Officer
Forward Looking Statements
This press release contains forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and assumptions and accordingly, actual results and future events could differ materially from those expressed or implied in such statements. You are hence cautioned not to place undue reliance on forward-looking statements. All statements other than statements of present or historical fact are forward-looking statements, including statements with respect to MagicMed's future business plans and partnerships, the use of proceeds from the Offering, and the anticipated uses of MagicMed's patents and the development of the PsybraryTM. Forward-looking statements include words or expressions such as "proposed", "anticipated", "will", "subject to", "near future", "in the event", "would", "expect", "prepared to" and other similar words or expressions.
Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking statements. Some of the risks and other factors could cause results to differ materially from those expressed in the forward-looking statements which include, but are not limited to: the ability of MagicMed to secure financing on the terms set out in this press release or at all; the ability of MagicMed to secure patent protection; the regulatory environment in which MagicMed operates; the ability of MagicMed to enter into partnership agreements or other arrangements; the ability of MagicMed to carry out its business plans (including but not limited to its plans to file a non-offering prospectus and apply to list on a stock exchange) and unforeseen challenges in carrying out such plans; the development and expansion of the PsybraryTM; trends in the future use of psilocybin; general business, economic, competitive, political and social uncertainties; the state of capital markets; risks relating to general economic, market and business conditions; and other unforeseen events, developments, or factors causing any of the aforesaid expectations, assumptions, and other factors ultimately being inaccurate or irrelevant. The forward-looking information contained in this news release is expressly qualified by this cautionary statement. We disclaim any obligation to update or revise these forward-looking statements, except as required by applicable law.