COVID-19 Could Further Delay Efforts to
Reinstate Cannabis Licenses
VAUGHAN, ON, March 23, 2020 /CNW/ - CannTrust Holdings
Inc. ("CannTrust" or the "Company", TSX: TRST, NYSE: CTST)
announced today that it received a notification from Health Canada
as a result of current circumstances created by COVID-19. As
a precautionary measure for the health and safety of its employees
and the community, Health Canada's Cannabis Directorate is reducing
onsite field inspection activities until at least March 31, 2020.
CannTrust noted that many commercial enterprises, including the
Company itself, have been reducing their onsite activities in
response to COVID-19. Health Canada's response to the COVID-19 pandemic
could adversely affect the timing of the Company's remediation
efforts. On February 14, 2020,
CannTrust submitted documentation to Health Canada regarding the
completion of the Company's remediation activities at its Niagara
Facility in support of the reinstatement of that facility's
licences. CannTrust had anticipated that remediation
activities at the Company's Vaughan Facility would reach completion
during the second quarter of 2020. The Company intended thereafter
to submit the required documentation to Health Canada in support of
the reinstatement of that facility's licenses. These
activities could be delayed as a consequence of COVID-19.
Ultimately, any decision to reinstate the Company's licenses, and
the timing and conditions of any such reinstatement, will rest
solely with Health Canada. No assurance can be given that Health
Canada will reinstate the Company's licenses at either its Niagara
or Vaughan Facilities.
CannTrust remains in default of its disclosure obligations under
securities legislation, has no meaningful revenues, has terminated
or laid-off a significant portion of its workforce, is facing a
variety of regulatory investigations, is facing potential delisting
of its common shares by the Toronto Stock Exchange and New York
Stock Exchange if it does not cure its disclosure defaults by
April 15, 2020 and has significant
contingent liabilities in both Canada and the
United States, including for potential civil damages and
potential criminal, quasi-criminal or administrative penalties and
fines, which cannot be reasonably quantified.
As of February 29, 2020, CannTrust had a cash balance of
approximately $159 million. CannTrust and its Board of
Directors continue to monitor the Company's cash balance and other
factors carefully to, among other things, assess various strategic
alternatives while pursuing the Company's remediation work.
CannTrust reiterated that the nature, timing, and outcome of the
Board of Directors' ongoing strategic review process will be
influenced by, among other things, the Company's ability to extend
or renew insurance coverage on acceptable terms, whether or when
Health Canada reinstates the Company's licenses, how long it will
take to restore operations and expectations regarding the
resolution of the Company's contingent liabilities, and potential
civil, criminal, quasi-criminal, administrative and regulatory
actions in both Canada and
the United States.
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 corrective actions being
taken by the Company, and Health Canada's pending determinations.
Forward-looking information and statements necessarily involve
known and unknown risks, including, without limitation: actions
taken in respect of the Company's products by its customers and
regulators; results of Health Canada's investigation, including
orders and compliance measures required by Health Canada and their
impact on the operations, inventory, assets and financial condition
of the Company; the Company's implementation of remediation plans
and related actions; regulatory approval; the outcome of the
Company's contingent liabilities; the impact of potential
regulatory investigations; the Company's review of strategic
alternatives; 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 "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 CannTrust 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.
The TSX and NYSE do not accept responsibility for the adequacy
or accuracy of this release.
View original content to download
multimedia:http://www.prnewswire.com/news-releases/canntrust-provides-update-regarding-health-canada-remediation-301028472.html
SOURCE CannTrust Holdings Inc.