Toronto, Ontario–(Newsfile Corp. – September 1, 2020) – PharmaDrug Inc. (CSE: BUZZ) (OTC: LMLLF) (“PharmaDrug” or the “Company“) is pleased to announce that it has entered into employment agreements with Daniel Cohen, the Company’s Chairman and CEO, and Harry Resin, President of PharmaDrug’s wholly-owned subsidiary Interrobang Ltd. d/b/a Super Smart. The Company has also granted incentive options to its Board of Directors and Officers and issued share-based compensation to 7725434 Canada Inc. (a holding company controlled by Daniel Cohen), and Howard Brass, the Company’s former chief operating officer, to settle unpaid amounts owing under previous consulting agreements. Daniel Cohen has not been earning a salary since October of 2019.
As part of the Company’s long-term incentive program, and pursuant to the terms and conditions of its stock option plan, the Pharmadrug Board of Directors has approved the grant of 8,500,000 stock options to its Board of Directors, Daniel Cohen, Harry Resin and CFO Keith Li. The options expire five years from the date of grant and are exercisable at a price of $0.05 per common share. 3,000,000 of the options vest immediately and 5,500,000 of the options vest in one third increments after 6 months, 12 months and 18 months until fully vested.
In order to settle amounts owing under management consulting agreements with 7725434 Canada Inc. and Mr. Brass, the Company has issued 1,300,000 common shares to 7725434 Canada Inc. and 500,000 common shares to Mr. Brass.
The options, shares issuable on exercise of the options and the shares issued in connection with the debt settlements are subject to a hold period expiring on January 1, 2021.
Mr. Cohen is an insider of the Company and as a result the issuance of shares constitutes a related party transaction under applicable securities laws. The issuance was completed in accordance with a consulting agreement with the Company and was approved by the independent directors of the Company. If required, the material change report will be filed less than 21 days before the closing date of the restructuring, but the Company believes that this shorter period is reasonable and necessary in the circumstances as the Company wishes to improve its financial position by reducing its accrued liabilities as soon as possible.
The Company relied upon the exemptions in sections 5.5(b) (Issuer Not Listed on Specified Markets) and 5.7(1)(a) (Fair Market Value Not More Than 25 Per Cent of Market Capitalization) of Multilateral Instrument 61-101.
Update on Closing of Acquisition of First Store in The Netherlands
The acquisition of Super Smart’s first store in Tiel was intended to close by the end of August, but has been postponed due to delays experienced by the vacation season in The Netherlands. All of the due diligence has been satisfied and most pre-conditions have been met. Management now expects the acquisition to close within the next couple of weeks and does not believe the delay should be cause for concern.
About PharmaDrug Inc.
PharmaDrug Inc. is building an international controlled substance and natural medicine company with a focus on Europe. The Company owns 80% of Pharmadrug GmbH, a German medical cannabis distributor, with a Schedule I European Union narcotics license allowing for the importation and distribution of medical cannabis to pharmacies in Germany and throughout the EU. The Company also owns 100% of Super Smart, an early-stage retail company focused on consolidating the fragmented Dutch smartshop market. Smartshops are retail establishments in The Netherlands that specialize in the sale of psychoactive substances including psychedelic truffles.
For further information, please contact:
Daniel Cohen, Chairman and CEO
Caution Regarding Forward-Looking Information:
THE CANADIAN SECURITIES EXCHANGE HAS NOT REVIEWED NOR DOES IT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
This news release may contain forward-looking statements and information based on current expectations. These statements should not be read as guarantees of future performance or results of the Company. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those implied by such statements. Although such statements are based on management’s reasonable assumptions, there can be no assurance that such assumptions will prove to be correct. We assume no responsibility to update or revise them to reflect new events or circumstances. The Company’s securities have not been registered under the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act”), or applicable state securities laws, and may not be offered or sold to, or for the account or benefit of, persons in the United States or “U.S. Persons”, as such term is defined in Regulations under the U.S. Securities Act, absent registration or an applicable exemption from such registration requirements. 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 the United States or any jurisdiction in which such offer, solicitation or sale would be unlawful. Additionally, there are known and unknown risk factors which could cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information contained herein, such as, but not limited to dependence on obtaining regulatory approvals; the ability to locate additional supply of medical cannabis, owning interests in companies or projects that are engaged in activities currently considered illegal under United States federal law; changes in laws; limited operating history, reliance on management, requirements for additional financing, competition, hindering market growth; regulatory and political change. All forward-looking information herein is qualified in its entirety by this cautionary statement, and the Company disclaims any obligation to revise or update any such forward-looking information or to publicly announce the result of any revisions to any of the forward-looking information contained herein to reflect future results, events or developments, except as required by law.