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| Press Release

North Sur Resources and Mindset Pharma Announce Proposed Transaction to Accelerate Development of Medical Psychedelics Industry

VANCOUVER, British Columbia, June 29, 2020 (GLOBE NEWSWIRE) -- North Sur Resources Inc. (“North Sur”) and Mindset Pharma Inc. (“Mindset”) are pleased to announce that they have signed a binding letter of intent (the “Letter of Intent”) to combine their corporate entities. Mindset is an Ontario-based psychedelic pharma company that has filed multiple patents for new, pharmacologically optimized psychedelic medicines.

Mindset and North Sur have agreed to combine their corporate entities, (the “Transaction”) whereby (i) Mindset will become a wholly-owned subsidiary of North Sur, (ii) the current shareholders of Mindset will become the controlling shareholders of North Sur, (iii) the business of Mindset will be the business of North Sur; (iv) North Sur will change its name to “Mindset Pharma Inc.”, and (v) North Sur will be in a position to seek a listing on the Canadian Securities Exchange (“CSE”).

PSYCHEDELICS

Psychedelics are a class of drugs that affect the brain’s serotonin receptors, triggering a variety of changes in sight, hearing, and thought, as well as producing an altered state of consciousness. Drugs commonly included in this category are LSD (acid), psilocybin (psychedelic mushrooms), MDMA (ecstasy) and DMT (dimethyltryptamine).  

In recent years, there has been a growing interest in the beneficial uses of psychedelics within the scientific and medical community and mainstream society as a new generation of individuals reach out to explore the human development potential of substances such as psilocybin, LSD, ayahuasca, and MDMA. MDMA-assisted psychotherapy was granted Breakthrough Therapy Designation by the U.S. Food & Drug Administration (FDA) for the treatment of PTSD in 2017, was approved for Expanded Access in 2019 and is currently in Phase 3 clinical trials. Psilocybin was granted Breakthrough Therapy Designation for both treatment‐resistant depression and major depressive disorder in 2018 and 2019 respectively. Psilocybin is also being evaluated for the cessation of smoking, the treatment of depression, and reducing the fear of death in individuals with a terminal illness. Ayahuasca, a brew containing DMT, is being evaluated for its ability to combat depression.

Research undertaken by the Johns Hopkins Center for Psychedelic & Consciousness Research has demonstrated the therapeutic effects of psychedelics in individuals who suffer a range of challenging conditions including substance use disorder (smoking, alcohol, other drugs of dependency), existential distress caused by a life‐threatening disease, and treatment‐resistant depression. Studying healthy volunteers has also advanced our overall understanding of the enduring positive effects of psilocybin and provided a unique insight into neurophysiological mechanisms of action, with implications for understanding consciousness and optimizing therapeutic and non‐therapeutic enduring positive effects.  

MINDSET

While psychedelics are showing promise, they are not, in their natural state, optimized as medicines.  Mindset has designed structurally unique compounds that it anticipates will evoke a similar psychedelic effect and therapeutic benefit as the well-known psychedelics while maintaining an optimized pharmacological profile. Mindset has filed multiple patent applications describing its new chemical entities and is advancing a group of compounds through pre-clinical screening in order to identify one or more lead compounds to select for clinical trials.  Mindset’s goal is to develop a broad portfolio of psychedelic-inspired intellectual property around novel drugs and related synthesis processes that will grow in value as the psychedelic medicine space develops and regulatory acceptance increases.

James Lanthier, CEO of Mindset commented: “We are thrilled to be at the forefront of the generational shift that psychedelic-inspired medicines represent for the treatment of mental health indications.  We look forward to partnering with North Sur as we continue to advance our innovations and grow our business.”   

MINDSET MANAGEMENT AND BOARD OF DIRECTORS

James Lanthier, CEO  
James is a seasoned technology executive with strong expertise in corporate finance, public markets, and M&A. Most recently, James was co-founder and CEO of Future Fertility, an innovative early-stage developer of AI applications for human infertility. As a C-Suite executive, James has assisted in the growth and successful exit of several technology-enabled businesses through the public markets, including Mood Media, the world’s largest in-store media provider, and Fun Technologies, a pioneer in online casual games.

James Passin, Director
James is a 19-year hedge fund and private equity fund veteran with deep experience in emerging market equities and venture capital. He is a director of BDSec JSC, the largest investment bank in Mongolia, where he was awarded the Friendship Medal by the Mongolian state. Formerly a Principal at New York-based Firebird Management LLC, James has been called a “Daredevil  Investor” by the New York Times and “the Indiana Jones of Frontier Stock Markets” by the Financial Times.

Richard Patricio, Director
Richard is President and CEO of Mega Uranium Ltd., a uranium-focused investment and development company with assets in Canada and Australia.  He is a qualified lawyer (Ontario) with over 15 years of experience working with and for public companies.  He has built a number of companies with global operations and spent over 10 years with a TSX-listed investment company focused on the early-stage investment space. 

Philip Williams, Director
Philip has more than 20 years of finance industry experience. His diverse experience includes roles as C-Suite Executive, as a sell-side research analyst, in fund management, managing director of investment banking, and sits on the board of several public companies in Canada.

SCIENTIFIC TEAM

Dr. Joseph Araujo, Chief Science Officer and Director
Joseph is the CEO of InterVivo Solutions, which is focused on optimizing translational services to facilitate the development and approval of novel central nervous system (CNS) drugs.  He has graduate training in pharmacology at the University of Toronto and has more than 35 refereed publications and several invited presentations, which focus on natural aged canine models of human diseases.  In addition, he has co-founded, held executive-level positions, and consulted for Life Science companies including CanCog Technologies, Vivocore, Karyopharm Therapeutics, NPM Pharma, Ketogen, and Epione Animal Health and done extensive research examining psychoactive drugs.

Dr. Malik Slassi, Advisor
Malik was the founder, President, and Chief Scientific Officer of Fluorinov Pharma Inc., which was acquired by Trillium in January 2016.  He has over 30 years of experience in the successful identification and development of small molecule drug candidates across multiple therapeutic areas. He was the former Director and Vice President of Medicinal Chemistry and Manufacturing & Drug Development at NPS Pharmaceuticals and Cascade Therapeutics, respectively, and earlier he held management and scientific positions at Allelix Biopharmaceuticals Inc., Boehringer Ingelheim Research Inc., and Rhône Poulenc.  During his career, Malik has been involved in numerous multinational R&D collaborations including with Hoechst AG (Sanofi-Aventis), AstraZeneca, Johnson & Johnson, Forest Laboratories, GlaxoSmithKline, and Memory Pharmaceuticals. Malik is an inventor with over 130 issued and published patents and patent applications, and author of more than 65 scientific and review articles published in international peer-reviewed journals. He holds a Ph.D. in chemistry from the University of Claude Bernard, Lyon, France and completed his postdoctoral work in the Chemistry Department at the University of Montreal, Canada.

TERMS OF THE TRANSACTION

There are currently 12,479,800 common shares in the share capital of North Sur (“North Sur Shares”) issued and outstanding and 12,000,000 share purchase warrants outstanding. Mindset currently has 21,096,700 common shares in its share capital issued and outstanding (“Mindset Shares”) and 5,300,000 stock options (“Mindset Options”) outstanding. In conjunction with the Transaction and as conditions to closing:

  1. North Sur and Mindset will complete a business combination by way of a share exchange, merger, amalgamation, arrangement, share purchase or other similar form of the transaction pursuant to which the security holders of Mindset will become security holders of North Sur;

  2. North Sur will complete an initial private placement to raise up to $1,000,000 through the issuance of 6,666,666 North Sur Shares at $0.15 per share (the “Financing”);

  3. on the closing of the Transaction, North Sur will:

    1. issue such number of North Sur shares to the holders of Mindset Shares such that the Mindset shareholders will own 62.7% of the issued share capital of North Sur at closing on a non-diluted basis (“Exchange Ratio”); and
    2. issue options to acquire North Sur shares to the holders of the Mindset Options, on the same Exchange Ratio, exercisable on equivalent terms;

  4. the board of directors of North Sur will consist of such persons as may be nominated by Mindset; and

  5. stock options may be issued to certain directors, officers, and consultants that will vest over a 36-month period, with 10% vesting immediately and 15% vesting every six months thereafter.

On the closing of the Transaction, North Sur will change its name to “Mindset Pharma Inc.” and will prepare documentation to seek a listing on the CSE. Full details of Mindset, including its financial statements, management, and business operations, along with the terms of the transaction with North Sur, will be set out in North Sur’s CSE Listing Statement which will be posted on SEDAR.

ON BEHALF OF

NORTH SUR RESOURCES INC.

Robert W. Falls, CEO

MINDSET PHARMA INC.

James Lanthier, CEO

jlanthier@mindsetpharma.com

Jason Atkinson, VP Corporate Development

jatkinson@mindsetpharma.com

This news release may contain certain “Forward-Looking Statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws.  When or if used in this news release, the words “anticipate”, “believe”, “estimate”, “expect”, “target”, “plan”, “forecast”, “may”, “schedule”, “intends” and similar words or expressions identify forward-looking statements or information.  These forward-looking statements or information may relate to the Transaction, the completion of the private placement, and other factors or information.  Such statements represent North Sur’s current views with respect to future events and are necessarily based upon a number of assumptions and estimates that, while considered reasonable by North Sur, are inherently subject to significant business, economic, competitive, political and social risks, contingencies and uncertainties. Many factors, both known and unknown, could cause results, performance or achievements to be materially different from the results, performance, or achievements that are or may be expressed or implied by such forward-looking statements. North Sur does not intend and does not assume any obligation, to update these forward-looking statements or information to reflect changes in assumptions or changes in circumstances or any other events affecting such statements and information other than as required by applicable laws, rules and regulations.

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