MediPharm Labs Announces Release of $18.9 Million in Escrowed Funds

Company moving forward with a position of increased financial strength and flexibility to accelerate entrance in international markets and deliver on longer-term global pharmaceutical opportunities

TORONTO, Aug. 06, 2020 (GLOBE NEWSWIRE) -- MediPharm Labs Corp. (TSX: LABS) (OTCQX: MEDIF) (FSE:MLZ) (“MediPharm Labs” or the “Company”) a global leader in specialized, research-driven pharmaceutical-quality cannabis extraction, distillation and derivative products, is pleased to announce that it has received from escrow the remaining half, net of certain fees, of the $37,822,500 in gross proceeds from the Company’s June 8, 2020 private placement (the “Offering”).  All dollar amounts in this news release are in Canadian dollars.

“We are pleased to have received the remaining portion of this strategic capital positioning us with increased financial strength and flexibility to deliver on longer-term opportunities with larger pharmaceutical and CPG companies and accelerate our entrance in international markets,” said Pat McCutcheon, Chief Executive Officer, MediPharm Labs. “We are building on our global customer partnerships and market share, providing international distribution expertise and delivering innovative products and brands. We remain excited to expand our participation across a range of clinical trials that offer potential upside towards future development of cannabis-based prescription RX products and products that can be registered in various global jurisdictions. We look forward to creating value for all shareholders as we build out our capabilities to drive future sustainable growth.”

On June 8, 2020, the Company received the initial $18,911,250 in proceeds of the Offering, net of certain fees, in connection with the placement of a $20,500,000 unsecured convertible note (the “First Note”) and a warrant (the “First Warrant”) to purchase up to 3,601,427 common shares of the Company (the “Common Shares”). The remaining $18,911,250 in proceeds of the Offering were placed in escrow in connection with the placement of a subscription receipt (the “Subscription Receipt”) entitling the holder to receive, upon satisfaction of certain escrow release conditions including shareholder approval (“Shareholder Approval”), a further $20,500,000 unsecured convertible note (the “Second Note” and, together with the First Note, collectively, the “Notes”) and a further warrant (the “Second Warrant” and, together with the First Warrant, collectively, the “Warrants”) to purchase up to 3,601,427 Common Shares.