CannTrust Announces the Issuance of CCAA Representation Order - Appointment of Representative Counsel for the Securities Claimants

Rhea-AI Summary

CannTrust Holdings has received a CCAA Representation Order from the Ontario Superior Court of Justice as part of its restructuring efforts under the Companies' Creditors Arrangement Act (CCAA). This order appoints representatives for Canadian and U.S. Securities Claimants and extends the stay of proceedings to April 30, 2021. The court also appointed Ernst & Young Inc. as the monitor for these proceedings. CannTrust aims to negotiate settlements regarding Securities Claims as part of their restructuring plan.

Positive

• Appointment of representatives for securities claimants may facilitate negotiations and settlements.
• Extension of stay until April 30, 2021, provides CannTrust additional time to restructure.

Negative

• Ongoing CCAA proceedings indicate financial distress and potential uncertainties in operations.

VAUGHAN, ON, Jan. 29, 2021 /PRNewswire/ - CannTrust Holdings Inc. ("CannTrust" or the "Company") today announced the issuance of a CCAA Representation Order by the Ontario Superior Court of Justice subject to proceedings under Canada's Companies' Creditors Arrangement Act ("CCAA"). Today's order appoints certain representatives to represent the interests of certain Securities Claimants and appoints counsel for them, subject to some limited exceptions. The Court also granted an extension to the stay of proceedings, until April 30, 2021.

Please see below for full notice.

IN THE MATTER OF THE COMPANIES' CREDITORS
ARRANGEMENT ACT, R.S.C. 1985, c. C-36, AS AMENDED

AND IN THE MATTER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF CANNTRUST HOLDINGS INC., CANNTRUST INC., CTI HOLDINGS (OSOYOOS) INC. AND ELMCLIFFE INVESTMENTS INC. (the "Applicants")

NOTICE OF CCAA REPRESENTATION ORDER

On March 31, 2020, the Applicants commenced proceedings (the "CCAA Proceedings") under the Companies' Creditors Arrangement Act ("CCAA") pursuant to an order of the Ontario Superior Court of Justice (Commercial List) (the "Court"). Ernst & Young Inc. has been appointed as the monitor of the Applicants (the "Monitor") by the Court.

On January 29, 2021, the Court issued an order (the "CCAA Representation Order") appointing certain representatives and representative counsel, as detailed further below. All capitalized terms used but not defined in this Notice have the meaning given to them in the CCAA Representation Order.

TAKE NOTICE THAT, pursuant to the CCAA Representation Order, subject to certain limited exceptions set out therein:

1. the CCAA Canadian Representatives have been appointed to represent the interests of all Canadian and Non-U.S. Securities Claimants in the CCAA Proceedings in relation to their Securities Claims and any related claims;
2. the CCAA U.S. Representatives have been appointed to represent the interests of the U.S. Securities Claimants in the CCAA Proceedings in relation to their Securities Claims and any related claims;
3. A. Dimitri Lascaris Law Professional Corporation, Henein Hutchinson LLP, Kalloghlian Myers LLP and Strosberg Sasso Sutts LLP ("CCAA Canadian Representative Counsel") have been appointed as counsel for the Canadian and Non-U.S. Securities Claimants in the CCAA Proceedings in relation to their Securities Claims and any related claims, and are authorized and directed to take instructions from the CCAA Canadian Representatives;
4. Weisz Fell Kour LLP in association with Labaton Sucharow LLP ("CCAA U.S. Representative Counsel" and collectively with CCAA Canadian Representative Counsel, "CCAA Representative Counsel") have been appointed as counsel for the U.S. Securities Claimants in the CCAA Proceedings in relation to their Securities Claims and any related claims, and are authorized and directed to take instructions from the CCAA U.S. Representatives; and
5. the CCAA Representatives and CCAA Representative Counsel are authorized to, among other things, negotiate with respect to the settlement of Securities Claims and the prosecution or settlement of any related claims and the development of the CCAA Plan and any related definitive documentation.

Copies of the CCAA Representation Order and other documents related to the CCAA Proceedings may be obtained from the case website maintained by the Monitor at http://www.ey.com/ca/canntrust.

If you have any questions regarding these matters, you may contact CCAA Canadian Representative Counsel, CCAA U.S. Representative Counsel and/or the Monitor as follows:

CCAA Canadian Representative Counsel:

A. Dimitri Lascaris Law Professional Corporation, Henein Hutchinson LLP, Kalloghlian Myers LLP and Strosberg Sasso Sutts LLP

Email: canntrust@strosbergco.com 
Tel: 519-561-6296

CCAA U.S. Representative Counsel:

Weisz Fell Kour LLP

Email: sweisz@wfklaw.ca
Tel: 416-613-8281

Labaton Sucharow LLP

Email: jjohnson@labaton.com
Tel: 212-907-0859

Monitor:

Ernst & Young Inc.
Telephone: 1-855-224-0800 or 416-943-2091
Fax: 416-943-3300
Email: CannTrust.Monitor@ca.ey.com

About CannTrust

CannTrust is a federally regulated licensed cannabis producer. We are proudly Canadian, operating a portfolio of brands including estora, Liiv and Synr.g, 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, which is currently sold in dried flower, 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.

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SOURCE CannTrust Holdings Inc.

FAQ

What is the significance of the CCAA Representation Order for CannTrust (CTST)?

The CCAA Representation Order allows CannTrust to appoint representatives to negotiate on behalf of Securities Claimants, aiding in their restructuring efforts under financial distress.

What does the CCAA Representation Order mean for investors of CannTrust (CTST)?

The order suggests ongoing financial challenges for CannTrust, which may affect investor confidence and the stock's performance.

Who has been appointed as the monitor for CannTrust's CCAA proceedings?

Ernst & Young Inc. has been appointed as the monitor overseeing CannTrust's restructuring under the CCAA.

How long is the stay of proceedings for CannTrust (CTST) extended?

The stay of proceedings has been extended until April 30, 2021, allowing CannTrust more time for its restructuring.