YOOMA WELLNESS INC. ANNOUNCES SALE OF VITALITY CBD

Toronto, Ontario, Sept. 29, 2023 (GLOBE NEWSWIRE) -- Yooma Wellness Inc. (CSE: YOOM, AQSE: YOOM) ("Yooma" or the "Company") today announced that its wholly-owned subsidiary Yooma Europe Limited (“Yooma Europe”) has completed the sale of Birmingham-based Vitality CBD Limited (“Vitality”), a UK-focused CBD company, for a total consideration of US$2.0 million (the “Disposal”) to Psilobrain Therapeutics Inc. (“Psilobrain”). Psilobrain is a private Canadian biotech company that uses the latest in psychedelic medicine to design products that facilitate evidence-based healing & wellness. Further details regarding Psilobrain is available at www.psilobrain.com.

Details on the Disposal

The consideration payable by Psilobrain comprises US$1.0 million in cash (the “Cash Consideration”), and US$1.0 million in new shares of Psilobrain (the “Consideration Shares”). The Cash Consideration is to be paid to the Company in three instalments, with US$350,000 paid on completion, US$300,000 to be paid within 130 days of completion, and US$350,000 to be paid within 210 days of completion. The shares of Vitality that were sold are subject to a charge in favour of the Company and Yooma Europe to secure the payment and performance of Psilobrain’s obligations in respect of the Cash Consideration instalments that come due after the completion date. The consideration payable by Psilobrain is subject to customary adjustments, Vitality having been sold on a debt-free, cash-free basis.

The Company expects that the Cash Consideration and Consideration Shares will be administered and applied towards the satisfaction of ongoing operating expenses and the settlement of the outstanding indebtedness and accrued liabilities of Yooma Europe and the Company.

The Company has provided customary warranties and indemnities in relation to the business and operations, assets, trading and financial affairs of Vitality (with related tax covenant and warranties). The current senior management team at Vitality have been retained by Psilobrain and will continue to operate the business day-to-day as Psilobrain focuses on integration and expansion.

Cash and Liquidity Update

The Company has faced and is continuing to face significant financial and operational challenges and liquidity constraints which have gradually increased in severity over the last year. With the completion of the Disposal, the Company no longer has any material operating business lines or revenue generating assets. While the Company is continuing to consider all available alternatives, as set out in greater detail in the Company’s press release dated February 9, 2023, there can be no assurance at this time that the Company will be successful in addressing its liquidity constraints on a timely basis or at all. If the Company is unable to secure additional sources of liquidity, it is anticipated that the Company will have no alternative other than to pursue a liquidation, winding-up or insolvency proceeding.