PharmaDrug Announces Issuance of Debenture Units

Rhea-AI Summary

PharmaDrug has completed the issuance of $412,552.94 in debentures to replace outstanding secured convertible debentures, along with 8,251,058 common share purchase warrants. The new debentures will mature on September 30, 2025, and are convertible into common shares at $0.05 per share. The debentures are secured by a general security agreement and will bear 22% annual interest only if unpaid at maturity. The accompanying warrants allow holders to purchase shares at $0.05 for two years. All securities are subject to a four-month hold period until March 16, 2025.

Positive

• Successful refinancing of matured debt obligations
• Extended maturity date to September 30, 2025
• No interest payments required unless principal remains unpaid at maturity

Negative

• High 22% penalty interest rate if principal remains unpaid at maturity
• Potential dilution from conversion of debentures and exercise of warrants at $0.05 per share
• Securities subject to four-month hold period limiting immediate liquidity

Toronto, Ontario--(Newsfile Corp. - November 15, 2024) - PharmaDrug Inc. (CSE: PHRX) (OTC Pink: LMLLF) ("PharmaDrug" or the "Company"), a specialty pharmaceutical company focused on the research, development and commercialization of controlled-substances and natural medicines and naturally-derived approved drugs, is pleased to announce that further to its press release dated October 31, 2024, it has completed the issuance of $412,552.94 principal amount of debentures to replace currently outstanding secured convertible debentures and a total of 8,251,058 common share purchase warrants (each a "Warrant").

Each Debenture will mature on September 30, 2025 and will be convertible into common shares at a price of $0.05 (subject to adjustment). Each debenture will be secured by a general security agreement from the Company. The debentures are being issued to replace presently outstanding secured convertible debentures and outstanding interest thereon, which debentures had previously matured (but remained unpaid). There will be no interest payable on the debentures unless the principal amount is not paid at maturity, in which case the debentures will bear interest at a rate of 22% per annum. The Warrants to be issued in connection with the debentures will entitle the holder to acquire one common share at a price of $0.05 per share (subject to adjustment) for a period of two years following the issuance thereof.

The debentures, warrants and underlying shares are subject to a four month hold period expiring on March 16, 2025.

About PharmaDrug Inc.

PharmaDrug is a specialty pharmaceutical company focused on the research, development and commercialization of controlled-substances and natural medicines such as psychedelics and previously approved drugs. PharmaDrug owns 51% of Sairiyo Therapeutics ("Sairiyo"), a biotech company that specializes in researching and reformulating established natural medicines with a goal of bringing them through clinical trials and the associated regulatory approval process in the US and Europe. Sairiyo is currently developing its patented reformulation of cepharanthine, a drug that has shown substantial third party validated potential for the treatment of infectious disease and rare cancers. Sairiyo is also conducting R&D in the psychedelics space for the treatment of non-neuropsychiatric conditions. PharmaDrug also owns 100% of SecureDose Synthetics Inc. ("SecureDose"), a pharmaceutical research and development company focused on the development of synthetic formulations of currently existing drugs for potential commercialization and distribution.

For further information, please contact:

Robert J. Steen, Chairman and CEO
rob@pharmadrug.co
(416) 400-7086

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. Forward-looking statements in this press release relate to the anticipated timing of the issuance of the debentures and warrants referenced herein. 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.

Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information. Such risks and other factors may include, but are not limited to: general business, economic, competitive, political and social uncertainties; general capital market conditions and market prices for securities; the actual results of the Company's future operations; competition; changes in legislation affecting the Company; the ability to obtain and maintain required permits and approvals, the timing and availability of external financing on acceptable terms; lack of qualified, skilled labour or loss of key individuals.

A description of additional risk factors that may cause actual results to differ materially from forward- looking information can be found in the Company's disclosure documents on the SEDAR+ website at www.sedarplus.ca. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward-looking information. Readers are cautioned that the foregoing list of factors is not exhaustive. Readers are further cautioned not to place undue reliance on forward-looking information as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated.

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.

Forward-looking information contained in this press release is expressly qualified by this cautionary statement. The forward-looking information contained in this press release represents the expectations of the Company as of the date of this press release and, accordingly, are subject to change after such date. However, the Company expressly disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities law.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/230234

FAQ

What is the total value of debentures issued by PharmaDrug (LMLLF) in November 2024?

PharmaDrug issued $412,552.94 in principal amount of debentures.

When do PharmaDrug's (LMLLF) newly issued debentures mature?

The debentures mature on September 30, 2025.

What is the conversion price for PharmaDrug's (LMLLF) new debentures?

The debentures are convertible into common shares at a price of $0.05 per share, subject to adjustment.

How many warrants did PharmaDrug (LMLLF) issue with the new debentures?

PharmaDrug issued 8,251,058 common share purchase warrants.