- Entered into a non-binding letter of intent with a private Canadian corporation and has started a transaction to monetize GrowPros to allow Tetra to focus its activities on the drug development and its clinical trials of its pharmaceutical business
OTTAWA, ONTARIO–( Dec. 21, 2017) –Â Tetra Bio-Pharma Inc. (“Tetra” or the “Company“) (TSX VENTURE:TBP)(OTCQB:TBPMF), a global leader in cannabinoid-based drug development and discovery, is pleased to announce that it has entered into a non-binding letter of intent (the “LOI“) with a private Canadian corporation (the “Purchaser“) and has started a transaction to monetize GrowPros (GrowPros MMP Inc., Tetra’s wholly-owned subsidiary) (the “Potential Transaction“), to allow Tetra to focus its activities on the drug development and its clinical trials of its pharmaceutical business. With this transaction, Tetra is expected to receive $350,000 and ensure another supply source of cannabis with pharmaceutical GMP quality for the pipeline of products under development.
It is expected that the Proposed Transaction would include the following main terms:
- Acquisition by the Purchaser of all the issued and outstanding shares of GrowPros held by the Company;
- Tetra will receive $350,0000 for the Potential Acquisition composed of (i) a first installment of $175,000 which was paid at the time of the signing of the LOI, (ii) a second installment of $175,000 which will be paid following signing of the definitive agreement giving effect to the LOI (the “Definitive Agreement“) and (iii) subject to stock exchange and securities regulatory approval and following the Purchaser’ initial public offering, 15,000,000 common shares of the Purchaser which would represent approximately a 33% equity interest in the share capital of the Purchaser post-initial public offering. The intention is for Tetra to eventually distribute these shares as a dividend in kind to its shareholders on a pro-rated basis;
- Purchaser’s responsibility to move GrowPros’ late stage ACMPR application forward (submitted in November 2014) with Health Canada;
- Grant by Purchaser and GrowPros of a right of first refusal to the Company on future cannabis production by GrowPros, which will ensure a second source of cannabis to the Company with pharmaceutical GMP quality for the production of the pipeline of products under development;
- Undertaking by the Purchaser to build a 15,000 square feet production facility located on 145 acres of agricultural land in Venosta, Quebec. The property has been approved for up to 1.5M square feet of production space; the Purchaser will ensure that a dedicated part of that production facility will be in compliance with good manufacturing practices for pharmaceutical product; construction of the production facility is expected to begin in the first quarter of 2018.
“We are very happy to leverage this asset that is Grow Pros. By finding a reliable partner, Tetra expects not only to immediately increase its cash flow, but also to enable its shareholders to maintain an investment in the high growth cannabis industry. As importantly, Tetra is further focusing on its core expertise and strength: the development of prescription drugs through the highest levels of clinical trials. Finally, we expect this deal to allow us to secure our production of dried cannabis for our lead drug candidate for its expected approval and eventual commercialization, and provide us with another partner from which we can supply our active pharmaceutical ingredients (API) for our drug development programs.” says Bernard Fortier, CEO of Tetra.
The Proposed Transaction contemplated by the LOI is subject to a number of significant condition precedents including but not limited to the entering into of the Definitive Agreement on terms satisfactory to both parties, the completion of the Purchaser’s initial public offering and receipt of all requisite approval (including stock exchange and regulatory approvals).
The parties intend to enter into the Definitive Agreement and close the Proposed Transaction by the end of the first quarter of 2018.
About Tetra Bio-Pharma:Â
Tetra Bio-Pharma (TSX VENTURE:TBP)(OTCQB:TBPMF) is a biopharmaceutical leader in cannabinoid-based drug discovery and clinical development. Tetra is focusing on three core business pillars: clinical research, pharmaceutical promotion and retail commercialization of cannabinoid-based products.
More information at:Â www.tetrabiopharma.com
Source: Tetra Bio-Pharma
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.Â
Forward-looking statementsÂ
Some statements in this release may contain forward-looking information. All statements, other than of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements regarding potential acquisitions and financings) are forward-looking statements. Forward-looking statements are generally identifiable by use of the words “may”, “will”, “should”, “continue”, “expect”, “anticipate”, “estimate”, “believe”, “intend”, “plan” or “project” or the negative of these words or other variations on these words or comparable terminology. Forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond the Company’s ability to control or predict, that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements. Factors that could cause actual results or events to differ materially from current expectations include, among other things, without limitation, the inability of the Company, through its wholly-owned subsidiary, GrowPros MMP Inc., to obtain a license for the production of medical marijuana; failure to obtain sufficient financing to execute the Company’s business plan; competition; regulation and anticipated and unanticipated costs and delays, the success of the Company’s research strategies, the applicability of the discoveries made therein, the successful and timely completion and uncertainties related to the regulatory process, the timing of clinical trials, the timing and outcomes of regulatory or intellectual property decisions and other risks disclosed in the Company’s public disclosure record on file with the relevant securities regulatory authorities. Although the Company has attempted to identify important factors that could cause actual results or events to differ materially from those described in forward-looking statements, there may be other factors that cause results or events not to be as anticipated, estimated or intended. Readers should not place undue reliance on forward-looking statements. While no definitive documentation has yet been signed by the parties and there is no certainty that such documentation will be signed The forward-looking statements included in this news release are made as of the date of this news release and the Company does not undertake an obligation to publicly update such forward-looking statements to reflect new information, subsequent events or otherwise unless required by applicable securities legislation.
Tetra Bio-Pharma Inc.
Dr. Anne-Sophie Courtois, DVM
Vice President, Marketing & Communications
(514) 360-8040 Ext. 210
[email protected]
