PreveCeutical Medical Inc (PRVCF)

[Dust2332]

PreveCeutical Grants Asterion Option to Purchase up to a 51% Interest in Sol-Gel Intellectual Property
 

August 6, 2019, Vancouver, British Columbia: PreveCeutical Medical Inc. (“PreveCeutical”)(CSE: PREV, OTCQB: PRVCF, FSE: 18H), and Asterion Cannabis Inc. (“Asterion”) announce that they have entered into an option to purchase agreement (the “Option Agreement”), whereby PreveCeutical has granted to Asterion the right and option (the “Option”) to purchase up to 51% of PreveCeutical’s right, title and interest in and to certain intellectual property rights relating to a soluble gel (“Sol-Gel”) nasal delivery system for the nose-to-brain delivery of therapeutic formulations, including cannabis and cannabinoids (the “Sol-Gel IP”). 
 
PreveCeutical’s President and Chief Science Officer, Dr. Mak Jawadekar stated, “This option agreement presents a unique and timely opportunity for PreveCeutical.  We are excited to further our existing strategic partnership with Asterion and are confident that Asterion will assist PreveCeutical in the rapid commercialisation of the Sol-Gel IP.”
 
Stephen Van Deventer, Asterion’s Chairman and CEO stated, “We are pleased that our partner, PreveCeutical, has granted Asterion the exclusive option to purchase an interest in the innovative Sol-Gel IP, which provides Asterion with the option to acquire intellectual property that compliments its current business.”
 
Commercial Terms

To exercise the Option, Asterion, at discretion, will be required to make a series of cash payments to PreveCeutical in the aggregate amount of $2,652,000 as follows:
 Payment DatePayment Amount (CAD)Earned InterestEffective Date$325,0006.25%July 22, 2019$325,00012.50%(additional 6.25%)August 22, 2019$325,00018.75%(additional 6.25%)September 22, 2019$390,00026.25%(additional 7.50%)October 22, 2019$390,00033.75%(additional 7.50%)November 22, 2019$390,00041.25%(additional 7.50%)December 22, 2019$507,00051.00%(additional 9.75%)TOTAL:$2,652,00051% 
By making all of the above cash payments to PreveCeutical, Asterion will be deemed to have exercised the Option in full; provided that prior to the exercise of the Option in full, Asterion will have, and will be deemed for all purposes to have, acquired the various interests in and to the Sol-Gel IP (each, an “Earned Interest”), upon making the corresponding payment amounts to PreveCeutical as set forth in the above table.  
 
Upon the the earlier of ten days after the date of the exercise by Asterion of the Option in full and December 22, 2019 (the “Participation Date”), PreveCeutical and Asterion will be deemed to have entered into a joint venture for the continued development and commercialization of the Sol-Gel IP (the “Joint Venture”) in which Asterion’s participating interest will be 51% and PreveCeutical’s participating interest will be 49%, assuming that the Option is exercised in full.  On or prior to the Participation Date, the Parties intend to enter into a joint venture agreement (the “Joint Venture Agreement”) that will provide for the ownership, development and commercialization of the Sol-Gel IP.
 
Prior to the Participation Date, PreveCeutical is solely responsible to fund the costs for the continued development and commercialization of the Sol-Gel IP.  After the Participation Date, each of PreveCeutical and Asterion will be required to fund such costs in proportion to its respective participating interest in the Joint Venture, from time to time.
 
The Option is subject to a buy-back right held by PreveCeutical (the “Buy-Back Right”), whereby PreveCeutical will have the right to buy-back all, but not less than all of the Earned Interest by Asterion to such date at any time prior to the Participation Date by paying to Asterion an amount equal to 150% of the aggregate amount of all cash payments made by Asterion to PreveCeutical under the Option Agreement. 
 
The ability of PreveCeutical to transfer up to a 51% interest in the Sol-Gel IP is subject to PreveCeutical having obtained the necessary consents from UniQuest Pty Limited (the “UniQuest Consent”). Pursuant to the Option Agreement, if the UniQuest Consent is not obtained prior to the Participation Date, then PreveCeutical will be deemed to have exercised the Buy-Back Right and either: (i) PreveCeutical will be required to pay Asterion an amount equal to 110% of the aggregate amount of all cash payments made by Asterion to PreveCeutical under the Option Agreement (the “Repayment Amount”) within 10 days of the Participation Date; or (ii) the Repayment Amount will be deemed to be a loan by Asterion to PreveCeutical accruing interest at a rate of 8% per annum, compounding annually, with a maturity date of 24 months after the Participation Date.
 
About PreveCeutical
 
PreveCeutical is a health sciences company that develops innovative options for preventive and curative therapies utilizing organic and nature identical products.
 
PreveCeutical aims to be a leader in preventive health sciences and currently has five research and development programs, including: dual gene therapy for curative and prevention therapies for type 2 diabetes and obesity; a Sol-Gel drug delivery program; Nature Identical™ peptides for treatment of various ailments; non-addictive analgesic peptides as a replacement to the highly addictive analgesics such as morphine, fentanyl and oxycodone; and a therapeutic product for treating athletes who suffer from concussions (mild traumatic brain injury).
 
For more information about PreveCeutical, please visit www.PreveCeutical.com, follow us on Twitter: http://twitter.com/PreveCeuticalsand Facebook: www.facebook.com/PreveCeutical.
 
About Asterion 
 
Asterion is a Canadian medicinal cannabis company with operations in Australia, specializing in medical cannabis with a goal of becoming an industry leader in next generation cannabis products. Asterion is focused on the future of advanced agriculture and aims to produce the highest quality genetically uniform cannabis strains, at an affordable price.
 
Asterionis led by a team of highly experienced executives with over 120 years of combined experience in medical cannabis, renewable energy, capital markets, and other highly relevant sectors across North America, Oceania, Europe, Africa and Asia.
 
For more information about Asterion, please visit www.Asterioncannabis.com. 
 On Behalf of the Board of Directors of PreveCeutical 
 
“Dr. Mak Jawadekar”
President and Chief Science Officer
  On Behalf of the Board of Directors of Asterion
 
“Stephen Van Deventer”
Chief Executive OfficerFor further information, please contact:PreveCeutical:
 
Deanna Kress

Director of Corporate Communications &
Investor Relations

[phone]
[e-mail]:
 
 
Investor Relations
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