VAUGHAN, ON, July 22, 2019 /CNW/ - CannTrust Holdings Inc.
("CannTrust" or the "Company", TSX: TRST, NYSE: CTST) today
provided an interim update on the investigation being undertaken by
a special committee (the "Special Committee") of its board of
directors (the "Board of Directors").
As announced by the Company on July 11,
2019, the Special Committee was appointed by the Board of
Directors to investigate a compliance report from Health Canada
notifying the Company that its greenhouse facility in Pelham,
Ontario is non-compliant with
certain regulations.
The Special Committee is comprised of Robert Marcovitch (chairman), Shawna Page, Mark
Dawber, FCPA, and John Kaden,
Esq., each of whom is independent of management of the
Company. Short biographies of the members of the Special Committee
are provided below.
- Robert Marcovitch: Mr.
Marcovitch is a seasoned chief executive with substantial business
experience, managing companies with in excess of $1 billion dollars in revenue. Until recently, he
was the President and CEO of K2 Sports, an international developer,
manufacturer, marketer and distributor of winter sports equipment
(and was previously with K2 from 1999 to 2011). His
responsibilities included managing factories in Europe, the USA and Asia.
He was previously the Chief Executive Officer at The Coleman
Outdoor Company from 2011 until 2015, and prior to that, was Chief
Executive Officer and President of Ride, Inc. from 1994 to 1999,
which prior to its acquisition by K2 was a large publicly traded
company.
- Shawna Page: Ms. Page
brings years of experience in both the capital markets, as well as
the consumer retail markets. Ms. Page spent 10 years working at
Merrill Lynch Canada, followed by 10 years at TD Securities where
she was Managing Director and Chief of Staff. In 2007, Shawna
launched a unique mass-channel brand of gender-specific and
condition-specific products into the highly regulated nutraceutical
industry across Canada, and later
in various international markets, which she successfully exited in
November 2016.
- Mark Dawber: Mr. Dawber
is a FCPA with significant public accounting experience having been
an Audit Partner at Moore Stephens Hyde Houghton from 1971 until
1998 and BDO Canada LLP from 1999 to 2000. He has extensive public
company experience having served on public company boards for many
years as an independent director, chair of audit committees and as
a member of governance and compensation committees. He has
conducted numerous assignments for the Institute of Chartered
Accountants of Ontario's
Professional Conduct Committee.
- John Kaden: Mr. Kaden is
the Co-Founder, Managing Partner and Chief Investment Officer of
Navy Capital Green Management LLC., a global investment firm based
in New York City specializing in
public and private investments in the emerging legal cannabis
industry. Prior to this. Mr. Kaden was the co-Manager and Chief
Investment Officer for Northwoods Capital Management LLC, a global
hedge fund focused on the technology, media and telecom sector.
Before joining Northwoods, Mr. Kaden was the Founder and Managing
Partner of Cynthion Partners, a global macro hedge fund, from 2006
through to the end of 2013. Mr. Kaden graduated Magna Cum Laude
with an A.B. from Harvard University
and a J.D. from Yale Law School.
The Special Committee was appointed with a broad mandate to,
among other things, investigate the Company's non-compliance with
Health Canada regulations and ancillary matters, to make
recommendations to the Board of Directors regarding any actions to
be taken by CannTrust as a result of the investigation, and to
assess any impact on the Company's bio assets, inventory, sales and
revenue. The Company, under the Special Committee's supervision, is
continuing to engage with Health Canada and filed a response to the
Health Canada report on July 17,
2019. The Company is awaiting Health Canada's response.
The Special Committee's investigation and deliberations are
ongoing. The Special Committee's chairman, Robert Marcovitch, said: "The Special Committee
takes these issues very seriously and is committed to working with
Health Canada to bring the Company into compliance. Although we
want to move as quickly as possible, we are mindful of the critical
need to be thorough. We are determined to identify the root causes
for all non-compliance issues, to take appropriate actions to
address and remediate any issues with the Company's compliance
culture and to restore trust in the Company."
During the past week, the Special Committee met several times
with its legal counsel, McCarthy Tétrault LLP, and other
advisors.
Financial Outlook
At this time, the impact of these matters on CannTrust's
financial results is unknown. Further updates will be provided as
they become available.
About CannTrust
CannTrust is a federally regulated licensed producer of medical
and recreational cannabis in Canada. Founded by pharmacists,
CannTrust brings more than 40 years of pharmaceutical and
healthcare experience to the medical cannabis industry and serves
medical patients with its dried, extract and capsule products. The
Company operates its Niagara Perpetual Harvest Facility
in Pelham, Ontario, and
prepares and packages its product portfolio at its manufacturing
centre of excellence in Vaughan, Ontario. The Company has also purchased 81
acres of land in British Columbia and expects to secure
over 240 acres of land in total for low-cost outdoor cultivation
which it will use for its extraction-based products.
Forward Looking Statements
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 the expected timeframe and
resolution for the completion of Health Canada's quality product
testing and the Company's response to Health Canada's compliance
report. Forward-looking information and statements necessarily
involve known and unknown risks, including, without limitation:
results of Health Canada's quality product testing; regulatory
approval; risks associated with general economic conditions;
adverse industry events; loss of markets; future legislative and
regulatory developments in Canada, the United
States and elsewhere; the cannabis industry
in Canada generally; and, the ability of CannTrust to
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,
CannTrust 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 CannTrust 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 CannTrust'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 CannTrust'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 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.
The TSX and NYSE do not accept responsibility for the adequacy
or accuracy of this release.
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SOURCE CannTrust Holdings Inc.