MPXOF - MPX International Obtains Creditor Protection to Pursue Restructuring and Sales Process
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TORONTO, Ontario – TheNewswire - July 25, 2022- MPX International Corporation (the “Corporation” or “MPXI”) (CSE:MPXI ) ; ( OTC:MPXOF) announced todaythat the Corporation and certain of its Canadian subsidiaries(collectively, the “MPXI Group”) have been granted an order (the"Initial Order") from the Ontario Superior Court of Justice(Commercial List) (the "Court") under the Companies’Creditors Arrangement Act (the “CCAA”), in order to restructuretheir business and financial affairs. The Initial Order also extendscertain protections to MPXI's foreign subsidiaries.
Due to, among other things, margin pressures caused by significantcompetition and the fragmentation of the cannabis industry,operational and financial underperformance in Switzerland, Canada andelsewhere, and financial pressures resulting from obligations owing tocreditors, the MPXI Group has been unable to generate positive cashflows and has consistently incurred cumulative losses. After carefulconsideration of all available alternatives, the board of directors ofeach member of the MPXI Group determined that it was in the bestinterest of the MPXI Group and its stakeholders to seek creditorprotection under the CCAA.
The Initial Order provides for, among other things, a stay ofproceedings in favour of the MPXI Group and its foreign subsidiaries,the approval of debtor-in-possession financing (" DIP Financing ") and theappointment of KSV Restructuring Inc. as monitor of the MPXI Group (insuch capacity, the " Monitor "). Business operations will not be interruptedas a result of the CCAA proceedings.
The stay of proceedings and DIP Financing will provide the MPXI Groupwith the time and stability required to consider potentialrestructuring transactions and maximize the value of its assets forthe benefit of its creditors and other stakeholders. This may includethe sale of all or substantially all of the business or assets of theMPXI Group through a court-supervised sales process. In that regard,the MPXI Group intends to seek Court approval to launch a sale andinvestment solicitation process for its business and assets (the" SISP ") on or aroundAugust 4, 2022. The SISP is expected to be administered by theMonitor, with the assistance of the Applicants. Additional details inrespect of the SISP will be disclosed shortly.
Additional information regarding the CCAA proceedings – includingall of the Court materials filed in the CCAA proceedings – may befound at the Monitor's website:
https://www.ksvadvisory.com/insolvency-cases/case/MPXI
Cancellation of Annual Meeting ofShareholders
Pursuant to a press release issued on July 12, 2022, the Corporationadvised its shareholders that its annual meeting (the " Meeting ") initially scheduledto be held on July 15, 2022 at 10:00 am (Toronto time) would bepostponed until July 29, 2022 at 10:00 am (Toronto time). Pursuant tothe Initial Order, the Court has relieved the Corporation from itsobligation to hold the Meeting until further order of the Court. Accordingly, the Company will not proceedto hold the Meeting on July 29, 2022 . Should the Companydetermine to hold the Meeting at a future date, shareholders and otherinterested parties will be notified by way of further press release.
About MPXI
MPXI is a multinational diversified cannabis companyfocused on developing and operating assets across the internationalcannabis industry with an emphasis on cultivating, manufacturing andmarketing products which include cannabinoids as their primary activeingredient. With current operations spanning four continents inCanada, Switzerland, South Africa, Malta and Thailand as well asevolving partnership and distribution opportunities in otherjurisdictions, MPXI continues to position itself as an emergent globalparticipant in the cannabis industry.
Cautionary Statement RegardingForward-Looking Information
This news release includes certain “forward-lookingstatements” under applicable Canadian securities legislation thatare not historical facts. Forward-looking statements involve risks,uncertainties, and other factors that could cause actual results,performance, prospects, and opportunities to differ materially fromthose expressed or implied by such forward-looking statements.Forward-looking statements in this news release include, but are notlimited to, MPXI’s objectives and intentions, the availability ofDIP Financing, the outcome of the CCAA proceedings and the SISP. Forward-looking statements are necessarily based on a number ofestimates and assumptions that, while considered reasonable, aresubject to known and unknown risks, uncertainties and other factorswhich may cause actual results and future events to differ materiallyfrom those expressed or implied by such forward-looking statements.Such factors include, but are not limited to: general business,economic and social uncertainties; litigation, legislative,environmental and other judicial, regulatory, political andcompetitive developments; delay or failure to receive board,shareholder or regulatory approvals; the Corporation’s ability toeffectively deal with the restrictions, limitations and health issuespresented by the COVID-19 pandemic; future cannabis pricing; cannabiscultivation yields; costs of inputs; its ability to market productssuccessfully to its anticipated clients; reliance on key personnel andcontracted relationships with third parties; the regulatoryenvironment in Australia, Canada, Malta, South Africa, Switzerland,Thailand and other international jurisdictions; the ability tocomplete any future potential transactions in connection with the SISPin CCAA Proceedings and the terms and conditions thereof; theavailability of DIP Financing, the application of federal, state,provincial, county and municipal laws; and the impact of increasingcompetition; those additional risks set out in MPXI’s publicdocuments filed on SEDAR at www.sedar.com, including its auditedannual consolidated financial statements for the financial years endedSeptember 30, 2021 and 2020, and the corresponding management’sdiscussion and analysis; and other matters discussed in this newsrelease related to the CCAA proceedings and the SISP. Although MPXIbelieves that the assumptions and factors used in preparing theforward-looking statements are reasonable, undue reliance should notbe placed on these statements, which only apply as of the date of thisnews release, and no assurance can be given that such events will occur in the disclosed time frames or at all.Except where required by law, MPXI disclaims any intention orobligation to update or revise any forward-looking statement, whetheras a result of new information, future events, or otherwise.
For further information about MPXIand the CCAA proceedings, please contact the Monitor:
KSV Restructuring Inc.
Murtaza Tallat
1- 416.932.6031
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