P Squared Renewables Inc. Enters into Amalgamation Agreement for Its Qualifying Transaction with Universal Ibogaine Inc.

Calgary, Alberta – TheNewswire – October 9, 2020 – P Squared Renewables Inc. (TSXV:PSQ.P) ("PSQ"), a capital pool company, is pleased to announce that, further to its news releases dated June 2, 2020 and September 15, 2020, PSQ has entered into an amalgamation agreement (the "Amalgamation Agreement") with Universal Ibogaine Inc. ("UI"), and a wholly-owned subsidiary of PSQ ("Subco") to acquire all of the outstanding shares of UI by way of a three-cornered amalgamation (the "Amalgamation") among PSQ, UI and Subco. The Amalgamation will result in a reverse take-over of PSQ by UI, which shall ?constitute PSQ’s qualifying transaction (the "Qualifying Transaction" or "QT", as defined under TSXV policies). It is anticipated that upon completion of the Qualifying Transaction, the ?resulting issuer will meet the Tier 2 listing requirements of the TSX Venture Exchange ("TSXV") for a ?Technology/Industrial issuer. ? A copy of the Amalgamation Agreement will be made available on PSQ’s SEDAR profile at www.sedar.com. ?

Terms of the QT

Pursuant to the Amalgamation Agreement, the core terms of the QT are as follows:

  • – UI and Subco will complete the Amalgamation under the Business Corporations Act (British Columbia) to form "Amalco", and PSQ (which will be the "Resulting Issuer", as defined under the policies of the TSXV) will issue common shares ("RI Shares") to the former UI shareholders, on the basis of one RI Share for each UI share, subject to a maximum total of 130,000,000 common shares (the "UI Shares") being ?issued to the UI shareholders and a maximum of 13,400,000 RI Shares being exchanged for PSQ’s outstanding common shares.

    – Each of UI’s outstanding warrants, options and other convertible securities (if any) will be exchanged for warrants, options and convertible securities of the Resulting Issuer on substantially the same economic terms and conditions as the existing warrants, options and other convertible securities of UI.

    – Upon completion of the QT, Amalco will become a wholly-owned subsidiary of the Resulting Issuer.

    – PSQ intends to change its name to "Universal Ibogaine Inc.", and Amalco will be renamed "Clear Sky Recovery Solutions Inc.", or such other names that are acceptable to the Resulting Issuer and to applicable regulatory authorities.

    – PSQ will conduct a prospectus offering of units (the "Prospectus Units") at $0.25 per Prospectus Unit, closing concurrently with the QT, for gross proceeds of a minimum of $3 million and a maximum of up to $5 million (the "Prospectus Offering "). The Prospectus Units are to be comprised of one common share and one-half of one common share purchase warrant, with each warrant exercisable (with an annual escalating exercise price, increasing by $0.25 per year, starting at $0.50 if exercised in year 1, to $1.50 if exercised in year 5) for a period of 5 years after closing of the QT. PSQ and UI are in discussions with parties to participate in a syndicate which would undertake the Prospectus Offering. Additional details of the Prospectus Offering will be provided in a subsequent news release.

    – Prior to closing of the QT, UI expects to complete a non-brokered private placement for aggregate gross proceeds of up to ? $2 million (the "UI Financing"). The UI Financing will be ?comprised of units ("UI Units") at a price of $0.25 per UI Unit, with each UI Unit comprised of one ?UI common share and one UI common share purchase warrant. Each warrant will be exercisable (with an annual escalating exercise price) for a period of 5 years after closing of the QT.

    – The $0.25 Unit price of the two financings would become the deemed transaction price for the QT. Further, it is intended that the current UI Financing would constitute a "concurrent offering" for purposes of TSXV approval of the QT and the intended Prospectus Financing.

Significant Conditions to Completion of the QT

Completion of the QT is subject to a number of conditions, including but not limited to: (i) the ?conditions stipulated in the Amalgamation Agreement (including completion of the Prospectus Offering); (ii) closing conditions customary to ?transactions of the nature of the QT; (iii) the approval of UI’s shareholders; and (iv) the ?approval of applicable regulatory bodies in connection with the QT, including but not limited to ?the TSXV. ?

Proposed Acquisition by UI of Initial Treatment Facility
and Selected Financial Information

In connection with UI’s primary business focus of operating addiction treatment sites, UI has entered into a letter of intent (dated August 9, 2020) with an arms-length party to acquire an initial facility in west central Canada (the "Facility"). UI intends to complete its due diligence review of the Facility by the end of October, and intends to close this acquisition in conjunction with closing of the QT.

The Facility is privately owned and has been in operation for 6 years. Condensed summary financial information from the Facility’s last two fiscal years ended November 30 is as follows:

(unaudited)

2019

2018

Revenues

$ 638,056

$ 711,173

Net income (loss)

(61,915)

16,966

Current assets

37,557

95,985

Other assets

56,537

72,817

Total assets

94,094

168,802

Current liabilities

123,413

133,315

Advances from related parties

72,404

75,295

Total liabilities

195,817

208,610

Shareholders’ equity

(101,723)

(39,808)

Total liabilities and shareholders’ equity

94,094

168,802

The Facility is operated under a long-term lease of the premises from certain of its related party shareholders. UI intends to initially acquire the operations of the Facility, and lease the related land and building (with a two-year option to subsequently acquire those assets). Further, UI intends to expand the operations and optimize and improve the historical occupancy of the Facility.

Grant of Stock Options by PSQ

Effective October 6, 2020, PSQ has granted to two members of its Board of Directors a total of 200,000 stock options, exercisable for a period of 10 years at a price of $0.20 per common share, and vesting immediately, in accordance with the terms and conditions of its incentive stock option plan.

About PSQ

PSQ was incorporated in 2017 and listed on the TSXV (as a Capital Pool Company) on June 21, 2017 under the trading symbol "PSQ.P". Since its formation, PSQ has been searching for and evaluating suitable business combinations to constitute its "Qualifying Transaction" as such term is defined in the policies of the TSXV.

PSQ is a "reporting issuer" in the provinces of Alberta and British Columbia and currently has 11,560,850 common shares outstanding and options exercisable or exchangeable for a total of 1,150,000 common shares, exercisable at an exercise price of $0.10 per share.

About Universal Ibogaine Inc.

UI is a privately held company formed in 2018 and based in Vancouver, BC. UI is in the initial stages of implementing and financing its business plan, which is to develop a network of global ibogaine assisted psycho-therapy clinics for the treatment and ideally the cure of addictions to primarily opioids, as well as alcohol, cocaine, heroin, fentanyl and other stimulants.

As noted above, UI intends to acquire an initial facility in west central Canada in conjunction with closing of the QT. In addition, UI plans to submit a Clinical Trial Application to Health Canada to undertake clinical trials in Canada to prove the efficacy of the use of ibogaine, a natural substance, in the treatment of polysubstance addictions including opioids. In the longer term, UI plans to introduce ibogaine into the addiction treatment protocols to be used in its future facilities.

UI is also in process of final closing of the acquisition of a 20 acre property on an island near San Pedro, Belize. UI is reviewing the concept of having a joint venture partner finance and develop a potential future resort or after-care facility on this site.

Trading of PSQ’s common shares

Trading in PSQ’s common shares have been suspended since June 27, 2019 for failing to complete a Qualifying Transaction within 24 months of its listing and will remain suspended until the QT has been completed and the requisite approvals by the TSXV have been obtained. The QT remains subject to approval by the TSXV.

Further Information

All information contained in this news release with respect to PSQ and UI was supplied by the parties respectively, for inclusion herein, and each party and its directors and officers have relied on the other party for any information concerning the other party.

Completion of the QT is subject to a number of conditions, including but not limited to, TSXV acceptance and, if applicable, pursuant to the requirements of the TSXV, shareholder approval by a majority of the minority. There can be no assurance that the QT will be completed as proposed or at all.

PSQ will provide a subsequent news release at such future time as further information becomes available on the final details of the UI Financing, the terms of the Prospectus Offering and other relevant developments.

Investors are cautioned that, except as disclosed in the Prospectus to be prepared in connection with the Prospectus Offering and the related QT, any information released or received with respect to the transactions 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 TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this news release.

NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This news release includes certain "forward-looking statements" under applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to: the terms and conditions of the QT; the business plans of UI; the terms and conditions of the UI Financing and the Prospectus Offering; UI’s proposed acquisition of the Facility; the planned use of funds from the UI Financing and the Prospectus Offering and the sufficiency thereof; the completion of the QT (including the Amalgamation contemplated thereby) and the associated transactions; the timing of such; and the business and operations of the Resulting Issuer after the QT.

Words such as "will", "expects", "anticipates", "intends", "plans", "believes", "estimates", or similar expressions identify forward-looking statements. Such forward-looking statements reflect the current beliefs of management of PSQ and UI, based on information currently available to them.

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; delay or failure to receive applicable 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. These forward-looking statements are made as of the date hereof and PSQ disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws.

NOT FOR DISSEMINATION IN THE UNITED STATES
OR THROUGH U.S. NEWS WIRES

For further information regarding the QT, please contact:

Shabir Premji

Executive Chairman & CEO

P Squared Renewables

Telephone: 403-870-1841

Email: spremji@p2renewables.com

Shayne Nyquvest

Chairman

Universal Ibogaine Inc.

Telephone: 604-512-9541

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