Psyence : Corporate Update

SPAC Transaction, Psyence Biomed Business Combination Agreement

On 9 January 2023, Psyence announced that its wholly owned subsidiary, Psyence Biomed Corp., had entered into a business combination with Nasdaq listed Newcourt Acquisition Corp (Newcourt). Psyence Biomed, Psyence's clinical trial division, will become a public company (the "Combined Company") through the business combination (the "Business Combination"), leveraging natural psilocybin in the treatment of palliative care.

If the Business Combination is completed, Psyence Group Inc, will continue to be listed on the Canadian Securities Exchange and will own a significant portion of the Combined Company. The merger agreement for the Business Combination provides that at the closing of the Business Combination, the Combined Company will receive a minimum of USD$20 million. Psyence will also continue to own and operate its other divisions.

The Business Combination is anticipated to conclude in the second half of 2023, with the resulting Combined Company being listed on the NASDAQ. The funds received from the Business Combination are expected to provide the Combined Company with the capital to advance its licensed natural psilocybin drug candidate (PEX010) into a Phase IIb clinical study in Australia.

Agreement with Cantheon Capital

Psyence entered into a brokered subscription agreement with Cantheon Capital, LLC (Cantheon) on 23 March 2023. Cantheon is a fund focussed on listed biotech stocks with near term catalysts. Cantheon will invest an aggregate amount of USD $1,393,750 of which the first 50% tranche of CAD$ 933,116 has closed.

Private Placement and Conversion of Debt Note

Since Q4 2022, Psyence has raised more than CAD $3.04 million ("Aggregate Proceeds") in numerous tranches. The Aggregate Proceeds raised triggered the conversion of the previously announced convertible debt note (announced December 2021). The Company does not have any debt on its balance sheet since the conversion of the note.

Cancellation of Stock options

The Company has cancelled 5,687,377 incentive stock options (the "Options") pursuant to its Stock Option Plan. The Options had been granted between December 31, 2020 and September 17, 2021 to certain directors, executive management, employees and consultants of the Company. The cancelled Options had an exercise price of C$0.30 and an expiry date of December 31, 2025 in respect of 3,887,377 Options and June 30, 2026 in respect of 1,800,000 Options. The Options were voluntarily surrendered by the holders for no consideration.

New board appointment

Christopher Bull was appointed to the board of directors of the Company on 10 July 2023. Mr. Bull is a qualified chemical engineer, attorney, patent attorney and Certified Licensing Professional®. He is also an alumnus of Saïd Business School, Oxford University (Private Equity and Venture Capital). Over his 30-year career, Mr. Bull has been an investor, director, founder and advisor to a range of successful companies in Europe and North America with novel technologies in the fields of pharmaceuticals, biotechnology, food sciences, chemical processing, and extraction technologies. Mr. Bull is recognised for his skills in relation to the development and execution of venture capital investment, patent and intellectual property strategies for high-technology companies and has received a number of international awards in recognition hereof.

"It gives me great pleasure reflecting on the strong progress we are making in executing on Psyence's strategy," said Dr. Neil Maresky, Psyence Chief Executive Officer. "The first phase of setting up our clinical trial in Australia is a significant milestone for our team, especially knowing that the work we do has the potential to significantly benefit patients in a palliative care setting. We are firmly on track to begin this study in the second half of this year. Together with the progress of our production strategy, we are looking forward to continuing along the path of executing our strategy for the remainder of 2023."