Mira VII Acquisition Corp. Announces Proposed Qualifying Transaction with HLS Therapeutics Inc.

TORONTO, Jan. 26, 2016 /CNW/ - Mira VII Acquisition Corp. ("Mira VII") (TSXV: MVA.P) is pleased to announce that it has entered into a letter of intent dated January 26, 2016 with HLS Therapeutics Inc. ("HLS"), to complete a going-public transaction in Canada for HLS (the "Proposed Transaction").  It is intended that the Proposed Transaction will proceed by way of a "three-cornered" amalgamation of HLS with a wholly-owned subsidiary of Mira VII ("Mira VII Subco") pursuant to the terms of a definitive agreement to be entered into by Mira VII, Mira VII Subco and HLS (the "Transaction Agreement").  Upon the closing of the Proposed Transaction, the name of Mira VII is expected to be changed to "HLS Therapeutics Inc." and is referred to herein as the "Resulting Issuer".  Immediately following the closing of the Proposed Transaction, it is anticipated that the amalgamated entity will amalgamate with the Resulting Issuer.

Mira VII intends that the Proposed Transaction will constitute its "Qualifying Transaction" under Policy 2.4 - Capital Pool Companies of the TSX Venture Exchange (the "TSXV"). The Proposed Transaction will be an arm's length transaction.

HLS is a specialty pharmaceutical company focused on commercializing: (i) branded pharmaceuticals through their life cycles post exclusivity; and (ii) promotional stage pharmaceutical drugs in selected therapeutic areas, primarily for the North American market. HLS is a corporation incorporated under the laws of the Province of British Columbia on June 5, 2014.

HLS's existing portfolio consists of Clozaril®, an atypical antipsychotic drug used in the treatment of the symptoms of schizophrenia.  HLS acquired the U.S. and Canadian rights to manufacture, market and sell Clozaril® from Novartis International AG in August 2015. HLS is actively pursuing additional product acquisitions for both the Canadian and United States markets.

HLS has an experienced management team that includes former executives from Biovail Corporation, including Bill Wells, Executive Chairman (former CEO of Biovail), Gregory Gubitz, CEO (former Senior Vice President, Corporate Development of Biovail) and Gilbert Godin, President and COO (former COO of Biovail).  HLS's experienced management team has a proven track record of successfully building and managing legacy and promotional stage pharmaceutical assets in North America and were the team that formulated and implemented the turnaround of Biovail in 2008 through refocusing Biovail's business on central nervous system drugs.

In August 2015, HLS raised US$385 million of capital through an equity financing of US$200 million at US$10 per share and a concurrent long term debt financing of US$185 million.  The proceeds of these financings were used, in part, to finance the acquisition of the rights to Clozaril®.

If the Proposed Transaction is completed, it is anticipated that the board of directors of the Resulting Issuer (the "New Slate") will consist of the six current directors of HLS, and the executive officers of the Resulting Issuer will be appointed by the New Slate.  The New Slate will be put forth and nominated at an annual and special meeting of Mira VII's shareholders (the "Meeting") to be held on March 15, 2016. Any and all holders of common shares of Mira VII as at the close of business on February 12, 2016, the record date for the Meeting, will be entitled to vote at the Meeting.

Prior to the completion of the Proposed Transaction, it is intended that the outstanding common shares of Mira VII will be consolidated on the basis of a ratio of 1 post-consolidation Mira VII common share for every 94.7 pre-consolidation Mira VII common shares (the "Consolidation") resulting in 131,995 common shares of Mira VII outstanding on a post-Consolidation basis.  For the purposes of the Proposed Transaction, the deemed value of each outstanding common share of Mira VII will be $0.15 (on a pre-Consolidation basis). 

Pursuant to the Proposed Transaction, the holders of common shares of HLS will receive one common share of the Resulting Issuer in exchange for each outstanding common share of HLS (on a post-Consolidation basis), being 23,278,000 common shares of the Resulting Issuer in the aggregate.  It is intended that the outstanding management options of Mira VII will be cancelled in connection with the consummation of the Proposed Transaction.  Following the completion of the Proposed Transaction, the shareholders of Mira VII and the former shareholders of HLS will hold approximately 1% and 99%, respectively, of the outstanding common shares of the Resulting Issuer (on a basic basis).

A comprehensive press release with further particulars relating to the Proposed Transaction and the Resulting Issuer will follow in accordance with the policies of the TSXV.

Completion of the Proposed Transaction is subject to a number of conditions including, but not limited to: completion of satisfactory due diligence; execution of the Transaction Agreement; receipt of regulatory approvals; acceptance of the Proposed Transaction as Mira VII's Qualifying Transaction by the TSXV; receipt of approval for the listing of the common shares of the Resulting Issuer; shareholders of HLS approving the Proposed Transaction and such other matters necessary to complete the Proposed Transaction; and shareholders of Mira VII approving certain matters ancillary to the Proposed Transaction, including the appointment of the New Slate, subject to the completion of the Proposed Transaction. There can be no assurance that the Proposed Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the filing statement to be prepared in connection with the Proposed Transaction, any information released or received with respect to the Proposed Transaction may not be accurate or complete and should not be relied upon.

Trading in securities of a capital pool company should be considered highly speculative.

The TSXV has in no way passed upon the merits of the Proposed Transaction and has neither approved nor disapproved the contents of this press release. Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this press release.

THIS PRESS RELEASE DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY SECURITIES IN ANY JURISDICTION, NOR SHALL THERE BE ANY OFFER, SALE, OR SOLICITATION OF SECURITIES IN ANY STATE IN THE UNITED STATES IN WHICH SUCH OFFER, SALE, OR SOLICITATION WOULD BE UNLAWFUL.

ANY SECURITIES REFERRED TO HEREIN WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933 (THE "1933 ACT") AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO A U.S. PERSON IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT.

Notice on forward-looking statements:

This release includes forward-looking information within the meaning of Canadian securities laws regarding Mira VII, HLS and their respective businesses, which may include, but are not limited to, statements with respect to the completion of the Proposed Transaction, the terms on which the Proposed Transaction is intended to be completed, the ability to obtain regulatory and shareholder approvals and other factors.  Often but not always, forward-looking information can be identified by the use of words such as "expect", "intends", "anticipated", "believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would" or "will" be taken, occur or be achieved.  Such statements are based on the current expectations and views of future events of the management of each entity, and are based on assumptions and subject to risks and uncertainties. Although the management of each entity believes that the assumptions underlying these statements are reasonable, they may prove to be incorrect. The forward-looking events and circumstances discussed in this release, including completion of the Proposed Transaction (and the proposed terms upon which the Proposed Transaction is proposed to be completed), may not occur and could differ materially as a result of known and unknown risk factors and uncertainties affecting the companies, including risks regarding the pharmaceutical industry, market conditions, economic factors, management's ability to manage and to operate the business of the Resulting Issuer and the equity markets generally.  Although Mira VII and HLS have attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended.  Accordingly, readers should not place undue reliance on any forward-looking statements or information.  No forward-looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and neither Mira VII nor HLS undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

Mira VII is a capital pool company governed by the policies of the TSXV. The principal business of Mira VII is the identification and evaluation of assets or businesses with a view to completing a Qualifying Transaction.

SOURCE Mira VII Acquisition Corp.

For further information: Mira VII Acquisition Corp.: Ronald D. Schmeichel, Chairman, (416) 972-6574; HLS Therapeutics Inc.: Greg Gubitz, Chief Executive Officer, (647) 495-9000, ext. 201

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