Mednow Enters Into Agreement to Acquire a Pharmacy in British Columbia

Mednow Inc. (“Mednow” or the “Company”) (TSXV:MNOW; OTCQB:MDNWF), Canada’s on-demand virtual pharmacy, is pleased to announce that the Company has entered into a share purchase agreement (the “Share Purchase Agreement”) on September 22, 2021 with Mednow Pharmacy Inc. (“Mednow West”) and the shareholders of Mednow West, pursuant to which the Company shall acquire all of the issued and outstanding shares (the “Shares”) of Mednow West, in consideration for an aggregate cash payment of approximately $74,000 and the Company’s agreement to convert approximately $908,000 (the “Pharmacy Agreement Debt”) owed by Mednow West to the Company pursuant to a pharmacy agreement dated September 24, 2020, as amended October 30, 2020 (the “Pharmacy Agreement”) into a non-interest bearing on-demand convertible promissory note (the “Note”).

Mednow West is a British Columbia company that operates an online pharmacy, delivering prescriptions in the Province of British Columbia. Mednow West has its business headquarters in Vancouver and employs Mednow’s marketing and technology platform for lead generation, prescription fulfillment and customer services pursuant to the Pharmacy Agreement.

Strategically, Mednow is focused on building out a national pharmacy footprint and the acquisition of Mednow West, with their presence in British Columbia, helps to accelerate these goals. Prior to this acquisition, Mednow entered into the Pharmacy Agreement with Mednow West, but post-acquisition, Mednow will own 100% of a pharmacy located in British Columbia, which will allow Mednow to provide pharmaceutical delivery services in British Columbia.

Upon closing of the Share Purchase Agreement, Mednow West’s revenue and expenses will be consolidated with those of Mednow and the Pharmacy Agreement between the two parties will be terminated. The debt of approximately $908,000 extended to Mednow West by the Company was to fund Mednow West’s working capital and provide support for its operations.

As Amir Ali Reyhany-Bozorg and Felipe Campusano are directors of the Company and Karim Nassar is the Chief Executive Officer of the Company, and each are also shareholders of Mednow West, the transaction contemplated under the Share Purchase Agreement (the “Transaction”) is a related party transaction under Multilateral Instrument 61-101 – Protection of Minority Securityholders in Special Transactions ("MI 61-101"). The Company is exempt from the formal valuation and minority shareholder approval requirements imposed by MI 61-101 pursuant to the exemptions in section 5.5(a) and 5.7(a) of MI 61-101, as neither the fair market value of the Shares, nor the consideration paid therefor, exceeds 25% of the Company's market capitalization.