Toronto, Ontario and Rionegro, Colombia--(Newsfile Corp. - July 17, 2024) - PharmaCielo Ltd. (TSXV: PCLO) (OTC Pink: PCLOF) ("PharmaCielo" or the "Company"), the Canadian parent of Colombia's premier cultivator and producer of dried flower and medicinal-grade cannabis extracts, PharmaCielo Colombia Holdings S.A.S., today provided shareholders with an update regarding reinstatement for trading on TSX Venture Exchange ("TSXV").
Audit Committee Appointment Marc Lustig, the Company's current Chairman and CEO, has been appointed to the Audit Committee of the Board of Directors, joining current independent members William B. Petron and Douglas Bache (chair).
Update Regarding Reinstatement for Trading On May 7, 2024, PharmaCielo announced that the Ontario Securities Commission (the "OSC"), as its principal regulator, issued a failure to file cease trade order ("FFCTO") prohibiting the trading by any person of any securities of the Company in Canada, including trades in the Company's common shares made through TSXV.
On July 2, 2024, the Company filed its Financial Results for the Fourth Quarter and Fiscal Year Ended December 31, 2023, and the First Quarter Ended March 31, 2024, and all required documentation on SEDAR+, and as a result, effective July 3, 2024, the OSC revoked its FFCTO.
The Company is expecting TSXV to finish its review of reinstatement for trading and allow PharmaCielo to reinstate for trading imminently.
Recent Financial Updates
The Company continued to make progress on its efficiency program and as of June 30, 2024, had reduced its cash burn rate to approximately C$250,000 per month;
The Company has closed the final tranche of the previously announced non-brokered private placement that was originally announced on June 29, 2023. To date, PharmaCielo has issued 5,000 debenture units (each a "Unit"), for aggregate proceeds of $5,000,000, the final tranche of the private placement of $125,000 was received on May 30, 2024.
On April 10, 2024, PharmaCielo announced that it was planning to undertake a non-brokered private placement of up to $3,000,000 under the Listed Issuer Financing Exemption ("LIFE"). The Company has received $700,000 in pre-subscriptions to date and intends to complete the financing following the reinstatement of trading on TSXV.
PharmaCielo also notes that at March 31, 2024, the Company had Current Assets of $3.2 million and Current Liabilities of $22.0 million, for a working capital (current assets less current liabilities) deficit of $18.8 million. The Company is currently in active negotiations with vendors and debt holders.
Update Regarding Letter of Intent to Acquire Operations in Thailand On April 10, 2024, PharmaCielo announced that it had signed a Letter of Intent (the "LOI") to enter a transaction (the "Proposed Acquisition") whereby it would acquire 100% of the issued and outstanding shares of Siam Ventures Corporation ("Siam Ventures") in exchange for common shares of PharmaCielo (the "PharmaCielo Shares"), representing aggregate consideration value of $3,000,000 (the "Purchase Price").
The Company has extended the LOI until September 9, 2024, to enable full completion of the due diligence.
Update Regarding Banco Agrario Loan In December 2020, the Company entered into a loan agreement ("loan") with Banco Agrario de Colombia S.A. ("Banco Agrario"), consisting of term and revolving components for a total value of $8,500,000,000 COP ($3,151,684). As disclosed in the Company's recently filed Audited Annual Financial Statements, available on SEDAR+, since September 23, 2023, PharmaCielo Colombia has not made regular instalment payments to Banco Agrario. The Company is in negotiations with Banco Agrario to change payment terms and extend repayment deadlines. Based on the Company's positive interactions with both Banco Agrario and the Colombian Government, and the Company's operations having been designated as a 'Project of National Interest', the Company is confident it will reach a mutually agreeable outcome with Banco Agrario.
About PharmaCielo PharmaCielo Ltd. (TSXV: PCLO) (OTC Pink: PCLOF) is a global company, headquartered in Canada, with a focus on ethical and sustainable processing and supplying of all natural, pharmaceutical-grade medical cannabis products to large channel distributors. PharmaCielo's principal (and wholly owned) subsidiary is PharmaCielo Colombia Holdings S.A.S., headquartered at its cultivation and processing center located in Rionegro, Colombia.
The board of directors and executive team of PharmaCielo are comprised of a diversely talented group of international business executives and specialists with relevant and varied expertise. PharmaCielo recognized the significant role that Colombia's ideal location plays in building a sustainable business in the medical cannabis industry, and the Company, together with its directors and executives, is executing on a business plan focused on supplying the international marketplace.
This news release contains forward-looking statements. Forward-looking statements can be identified by the use of words such as "expects", "is expected", "intends", "anticipates", "believes", or variations of such words and phrases or state that certain actions, events or results "may" or "will" be taken, occur or be completed or achieved.
Forward-looking statements can be affected by known and unknown risks, uncertainties and other factors, including changes to PharmaCielo's development plans, the failure to obtain and maintain all necessary regulatory approvals relating to the export of cannabinoid products and the import of these products into other countries, TSX Venture Exchange acceptance, the inability to export or distribute commercial products through sales channels as anticipated due to economic or operational circumstances, risks associated with operating in Colombia, fluctuation of the market price for the Company's products, risks associated with global economic instability relating to COVID-19 or other developments, risks related to retention of key Company personnel, currency exchange risk, competition in PharmaCielo's market and other risks discussed or referred to under the heading "Risk Factors" in PharmaCielo's Annual Information Form for the financial year 2019, and the Management's Discussion and Analysis for the financial year 2022 which are both available at www.sedarplus.ca. Accordingly, readers should not place undue reliance on forward-looking statements. Except as required by law, PharmaCielo undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.
All amounts expressed in Canadian dollars unless otherwise noted
