VAUGHAN, ON, March 15, 2022 /PRNewswire/ – CannTrust Holdings Inc. (the “Company”) (unlisted) today announced that its subsidiary, CannTrust Equity Inc. (“CannTrust Equity”), has completed its previously announced financing for aggregate cash proceeds of approximately CAD $17 million, as approved by the Ontario Superior Court on February 25, 2022 (the “Financing”).
A group of investors led by Marshall Fields International B.V., a subsidiary of Kenzoll B.V., a Netherlands-based private equity investment company, has invested CAD $11.2 million to acquire a 90% equity interest in CannTrust Equity and provided a CAD $5.5 million secured credit facility to CannTrust Equity, which is subordinated to the existing $22.5 million credit facility arranged by Cortland Credit Lending Corporation. The Company retains the remaining 10% of the common shares of CannTrust Equity.
With the completion of the Financing, the companies comprising the CannTrust Group, have emerged from their Court-supervised proceedings under the Companies Creditors Arrangement Act (“CCAA”), effective immediately.
“This marks the end of one long journey and the beginning of a new, exciting era for CannTrust. Today we can take our first step forward, focusing our attention on the bright future that lies ahead, with our new partners, Kenzoll.” said Greg Guyatt, Chief Executive Officer, CannTrust. “There’s lots to get done, but the entire team is excited to progress our 2022 strategy and announce our new company name.”
The Company plans to convene a meeting of its shareholders within the next four months. In the meantime, the Company intends to explore alternatives for either applying to the Ontario Securities Commission (“OSC”) for an order revoking the OSC’s “failure-to-file” Cease Trade Order dated April 13, 2020 or for taking steps to obtain a stock exchange listing for the common shares of CannTrust Equity.
CannTrust is a federally regulated licensed cannabis producer. We are proudly Canadian, operating a portfolio of brands including estora, Liiv, Synr.g and XSCAPE, specifically designed to surprise and delight patients and consumers.
At CannTrust, we are committed to providing an exceptional customer experience, as well as consistent and quality products through standardized processes. Our greenhouse produces Grade A cannabis flower, with products currently being sold in dried flower, pre-roll, vape, topical, oil drops and capsule formats. Founded in 2013, our continued success in the medical cannabis market and subsequent expansion into the recreational business, led to us being named Licensed Producer of the Year at the Canadian Cannabis Awards 2018.
CannTrust is committed to research and innovation, investing in developing technologies for new products in the medical, recreational, and wellness markets, while contributing to the growing body of evidence-based research regarding the use and efficacy of cannabis.
Learn more at www.canntrust.com
About Marshall Fields International B.V. and Kenzoll B.V.
Marshall Fields International B.V. is a subsidiary of Kenzoll B.V., a Netherlands-based private equity investment company. Kenzoll B.V. is based in Amsterdam, the Netherlands and is controlled by Corné Melissen. Kenzoll B.V.’s portfolio comprises investments in energy, technology and cannabis.
Learn more at https://kenzoll.com/
This press release contains “forward-looking information” within the meaning of Canadian securities laws and “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and other applicable United States safe harbor laws, and such statements are based upon CannTrust’s current internal expectations, estimates, projections, assumptions and beliefs and views of future events.
Forward-looking information and forward-looking statements can be identified by the use of forward-looking terminology such as “believes”, “expect”, “likely”, “may”, “will”, “should”, “intend”, “anticipate”, “potential”, “proposed”, “estimate” and other similar words, including negative and grammatical variations thereof, or statements that certain events or conditions “may”, “would” or “will” happen, or by discussions of strategy.
The forward-looking information and statements in this news release include statements relating to CannTrust’s efforts to resolve certain securities regulatory and stock exchange issues, some of which have not been finalized and remain subject to completing further analyses, obtaining shareholder and creditor approval and satisfying the requirements of securities regulators and a stock exchange. Forward-looking information and statements necessarily involve known and unknown risks, including, without limitation: the risk that, if CannTrust Equity requires additional equity, the Company’s investment in CannTrust Equity could be diluted further; the risk that CannTrust Equity or its affiliates could default under its credit facilities from Cortland Credit Lending Corporation or Marshall Fields International B.V., which are secured against substantially all of CannTrusts’s assets; the risk that the Company will not be able to cure its disclosure defaults under securities laws and obtain an order from the OSC to revoke the CTO, on commercially reasonable terms, or at all; the impact of any regulatory and other investigations or proceedings; the risks associated with general economic conditions and/or adverse industry events; the risk of loss of markets; the risk of future legislative and regulatory developments in Canada, the United States and elsewhere; the state of the cannabis industry in Canadagenerally; the ability of the Company to attract and retain suitable directors, officers and employees; the risks that, even if the CTO can be revoked, the Company will be unable to obtain a stock exchange listing for the Company’s common shares; the risk that neither the Company nor CannTrust Equity will be able to satisfy the requirements of such exchange; and the ability of CannTrust to successfully implement its business strategies.
Any forward-looking information and statements speak only as of the date on which they are made, and, except as required by law, the Company does not undertake any obligation to update or revise any forward-looking information or statements, whether as a result of new information, future events or otherwise. New factors emerge from time to time, and it is not possible for the Company to predict all such factors. When considering these forward-looking information and statements, readers should keep in mind the risk factors and other cautionary statements in the Company’s Annual Information Form dated March 28, 2019 (the “AIF“) and filed with the applicable Canadian securities regulatory authorities on SEDAR at www.sedar.com and filed as an exhibit the Company’s Form 40-F annual report under the United States Securities Exchange Act of 1934, as amended, with the United States Securities and Exchange Commission on EDGAR at www.sec.gov (the “March 2019 Form 40-F”). The risk factors and other factors noted in the AIF could cause actual events or results to differ materially from those described in any forward-looking information or statements. Readers are also reminded that the Company remains in default of its periodic disclosure requirements under applicable securities laws and stock exchange requirements, that its most recent AIF, Form 40-F and other disclosures do not reflect all risk factors that currently face the Company, and that the Company has not completed or filed the restatements of the financial statements included in the AIF or the March 2019 Form 40-F or otherwise filed an amendment to such Form 40-F, and that the Company was permitted by the Initial Order of the Superior Court of Justice to not to correct its prior filings or make any further filings in respect of periodic disclosure requirements under applicable securities laws and stock exchange requirements. None of the Company’s securities is listed for trading on any stock exchange in any jurisdiction and, in Canada, trading in the Company’s securities is subject to a cease-trade order issued on April 13, 2020 by the Ontario Securities Commission for CannTrust’s failure to comply with its disclosure obligations under applicable securities laws.
SOURCE CannTrust Holdings Inc.