Dr. Kah Meng Lim reports

COMPASS VENTURE ANNOUNCES DEFINITIVE AGREEMENT TO ACQUIRE CANNIOASIS PTE. LTD.

Further to its news release disseminated on June 10, 2024, Compass Venture Inc. has entered into a master exchange agreement dated Oct. 15, 2024, with CanniOasis Pte. Ltd., a Singapore-based biopharmaceutical company focused on utilizing cannabinoid medicine to develop effective personalized and targeted treatment regimens for neurological diseases, and all of the holders of ordinary shares of CanniOasis, pursuant to which the company has agreed to acquire all of the issued and outstanding CanniOasis shares in exchange for the issuance of common shares of Compass to the shareholders of CanniOasis.

Upon completion of the transaction, CanniOasis will become a wholly owned subsidiary of Compass, the business of CanniOasis will become the business of Compass, the CanniOasis shareholders will have a controlling interest in Compass, and CanniOasis will appoint new directors and officers to manage the resulting entity and its business.

The transaction constitutes the company's qualifying transaction (as defined by Policy 2.4, Capital Pool Companies of the TSX Venture Exchange) and is not a non-arm's-length qualifying transaction (within the meaning of the exchange's policies). The transaction is subject to the approval of the exchange and of the minority shareholders of the company, among other conditions of closing. Other than in connection with the concurrent financing (as defined herein), no commissions or finders' fees are being paid in relation to the transaction.

The transaction

The agreement includes standard representations, warranties and covenants for a transaction of this nature. Pursuant to the transaction, the company will acquire 100 per cent of the issued and outstanding CanniOasis shares in exchange for common shares of the resulting issuer. CanniOasis shareholders will receive one resulting issuer share for every 1.44 CanniOasis share held. Upon completion of the transaction, existing holders of common shares of Compass and CanniOasis shareholders would own approximately 7.4 per cent and 70.5 per cent of the resulting issuer, respectively, on a fully diluted basis, and the name of the resulting issuer will be changed to such name as CanniOasis may determine and as acceptable to the exchange.

The resulting issuer shares issued to principals (within the meaning of the exchange's policies) of the resulting issuer will be subject to escrow restrictions in accordance with the exchange's polices. In addition, the resulting issuer shares issued to other CanniOasis shareholders may be subject to resale restrictions as required by the exchange's policies.

The completion of the transaction will be subject to customary closing conditions, including, among others, the completion of the concurrent financing, receipt of all required approvals and consents for the transaction and all related matters, including approval of the disinterested holders of common shares of Compass, and the approval of the exchange and completion of the concurrent financing, and other standard closing conditions.

Related party transaction and minority shareholder approval

Dr. Kah Meng Lim, the chief executive officer and a director of the company, is also the controlling shareholder, director and chairman of the board of CanniOasis. Dr. Lim owns 124,377,941 CanniOasis shares, which represent approximately 95.7 per cent of the current total issued CanniOasis shares (prior to the concurrent financing described as follows). Dr. Lim owns 400,000 Compass shares, which represent 3.8 per cent of the current total issued and outstanding shares of Compass and are subject to escrow restrictions in accordance with the exchange's policies. The transaction is therefore considered a related party transaction for the purposes of Multilateral Instrument 61-101, Protection of Minority Security Holders in Special Transactions. As required by MI 61-101, the company will call a special meeting of shareholders to seek approval of the transaction by the company's minority shareholders (excluding Dr. Lim) by majority vote. In connection with the requirement for minority shareholder approval, Compass will file an information circular on its issuer profile on SEDAR+, which will contain prospectus-level disclosure regarding the transaction, CanniOasis and the resulting issuer.

The company is relying on the exemption from the formal valuation requirement provided in Section 5.5(b) of MI 61-101, which is available because the company's common shares are listed on the exchange.

About CanniOasis Pte. Ltd.

CanniOasis (formerly known as NGF (U.S.) Epilepsy/Pain) was incorporated by Dr. Lim pursuant to the Companies Act (Singapore) on Aug. 11, 2021.

CanniOasis is a personalized and targeted cannabinoid-based biopharmaceutical company based in Singapore. CanniOasis aims to be a leader in utilizing innovation-driven cannabinoid medicine to develop effective personalized treatment regimens for neurological diseases. Founded in 2021, CanniOasis has created a therapeutic and diagnostic platform for the development of precision cannabinoid-based drugs that includes prognostic clinical testing and molecular mapping to guide the personalized treatment of neurological disorders. Management believes that a key differentiator and competitive advantage for CanniOasis is its mid-brain organoid model, which is designed to derisk and shorten the drug development process for neurological disorders. Further information about CanniOasis and its business will be included in a subsequent news release.

Financial information of CanniOasis

Selected financial information for CanniOasis will be included in a subsequent news release.

Concurrent financing

The transaction is subject to completion by CanniOasis of a brokered private placement equity financing of subscription receipts of CanniOasis at a price of 16 cents per subscription receipt for aggregate gross proceeds of a minimum of $5-million or such other amount as required in order to meet the requirements under the exchange's policies. Ventum Financial Corp. will be the lead agent for the concurrent financing. Upon closing of the transaction and subject to certain conditions, the subscription receipts will be converted into common CanniOasis shares and will be immediately exchanged for resulting issuer shares at the share exchange ratio. The proceeds of the concurrent financing will be used to satisfy the business development and working capital requirements of the resulting issuer. The final terms as to the structure of the concurrent financing and any commissions and/or finders' fees are subject to the final agreement between the company, CanniOasis and the agent and will be announced in due course.

Deposits paid by CanniOasis

Each of Compass and CanniOasis will generally bear its own respective costs and expenses associated with the transaction and related transactions, except that CanniOasis has paid to Compass: (i) $50,000 as a refundable deposit to be used by Compass toward payment of legal costs and other professional fees associated with the transaction; and (ii) an additional $50,000 as a non-refundable deposit to be used by Compass toward payment of expenses in connection with the transaction.

Sponsorship

Sponsorship of the transaction is required by the exchange unless an exemption or waiver from this requirement is obtained in accordance with the policies of the exchange. The company has not yet engaged a sponsor in connection with the transaction. Additional information respecting the engagement of a sponsor will be provided once available.

Proposed management of the resulting issuer

At the closing of the transaction, it is anticipated that Yee Chuan Lim will be appointed as the chief executive officer and that the board of directors of the resulting issuer will consist of Dr. Lim, Joshua Chee Keong Siow and such other persons as may be determined by CanniOasis. Upon completion of the transaction, it is anticipated Dr. Lim will hold the majority of the resulting issuer shares. Information regarding other anticipated directors, officers and insiders of the resulting issuer will be disclosed in subsequent news releases.

Biographies for Mr. Lim, Dr. Lim and Mr. Siow are set out as follows.

Dr. Lim, 52 -- director

Dr. Lim is an accomplished scientist who obtained a PhD in biomedicine at the National University of Singapore School of Medicine in 2001. For more than 20 years, Dr. Lim has pursued his scientific interests in bioactive molecules that govern and regulate cellular pathways leading to cellular homeostasis and well-being. Dr. Lim has continually maintained his passion for finding innovative and commercially viable solutions for molecular medicine for cancers, where he has also published at least three international peer-reviewed scientific papers. He has filed for at least five patents related to cannabinoids, specifically on medical cannabis but not exclusive to just neurological usage.

Commercially, Dr. Lim has been involved in the following start-up companies:

1. GeneOasis BioScientific Pte. Ltd. (since 2013) (food supplies and processing, diagnostics, wellness management, and cell and gene therapies);
2. Green Oasis Therapeutics Pte. Ltd. (since 2017) (prenatal and postnatal extract-based supplements and 3-D tissue engineering).

Dr. Lim is currently involved with several companies in an executive position. He is the chief executive officer of Compass Venture (since 2019), Zenzic Labs (since 2019) and NGF BioEnterprise (since 2017). Dr. Lim is also on the board of GO-DX Corp. Ltd., Singapore Paincare Holdings Ltd., CanniOasis Pte. Ltd. and Betalife Pte. Ltd. Dr. Lim has held the following positions: Nanyang Technological University, School of Chemical and Biomedical Engineering, adjunct assistant professor (2012 to 2013); and Tianjin University, associate professor (2014 to 2017).

Mr. Siow, 70 -- director

Mr. Siow holds the following certifications: chartered accountant, Singapore; chartered certified accountant, England; and certified internal auditor, United States. Mr. Siow has extensive experience as a corporate director with numerous companies listed on the Singapore Exchange Ltd., the Stock Exchange of Thailand and the TSX-V as well as private companies, where he acted either as an independent or an executive director of the audit, risk management, remuneration and nomination committees.

Mr. Siow has management expertise in governance and business strategies, with extensive understanding of corporate organization, business operations, risk management, sustainability reporting, information technology systems, corporate finance and investments. He has worked in equity and option exchanges and clearing and depository organizations, besides numerous financial institutions for savings and trusts and commercial companies.

Mr. Siow held a management position at the then Vancouver Stock Exchange from 1989 to 1997. He was also the senior vice-president of the Singapore Exchange from 1997 to 2003. Since 2005, he has been the managing director of Virtus Assure Pte. Ltd., a company offering independent assurance services consultancy providing enterprise risk management, sustainability reporting and internal audits to stock-exchange-listed companies. Mr. Siow was a director of Key Venture Capital Inc. (2010 to 2014), which was listed on the TSX-V as a capital pool company. Together with the board of Key Venture, he aided in successfully completing a qualifying transaction by way of a combination of a capital pool company with Boxxer Gold Corp. (name changed to ExGen Resources Inc. on Dec. 18, 2014). Mr. Siow also serves as a director on the board of Compass Venture since December, 2021.

Mr. Lim, chief executive officer

Graduated with an MBA with a focus on entrepreneurship and finance, Mr. Lim has more than 20 years of work experiences in business management, corporate finance and strategic planning in both foreign and local MNCs (multinational corporations). Since 1998, Mr. Lim has held executive and management positions in KLA, Merrill Lynch, Inventec Besta, Pacific Internet, OCBC Bank, Agilent Technologies and HL Display and has worked extensively in the United States, Sweden, Germany, Switzerland and the Asia-Pacific region.

Currently based in Singapore, Mr. Lim has incubated and advised several local companies, including Handel Linc Display, Supplements Group, Woodlands Transport, SCash Global, Nest Asset Management, Feng Ming Construction, Katrina Holdings and Aly Energy. Mr Lim also served as a professional management consultant (PMC) and a consultant of Intellectual Property Office of Singapore (IPOS).

Additional information

All information contained in this news release with respect to CanniOasis and the company was supplied by the parties respectively, for inclusion herein, and each party and its directors and officers have relied on the other party for any information concerning the other party.

Complete details concerning the transaction, Compass, CanniOasis and the resulting issuer and the Concurrent Financing will be provided in the filing statement to be filed in connection with the transaction in the coming weeks, which will be available under Compass's SEDAR+ profile.

In accordance with exchange's policy, the Compass shares are currently halted from trading and will remain so until such time as the exchange determines, which may not occur until the completion of the transaction.

About Compass Venture Inc.

The company is a capital pool company within the meaning of Policy 2.4 of the exchange. Except as specifically contemplated in such policy, until the completion of its qualifying transaction, the company will not carry on business, other than the identification and evaluation of companies, businesses or assets with a view to completing a proposed qualifying transaction. Investors are cautioned that trading in the securities of a capital pool company is considered highly speculative.

We seek Safe Harbor.