CLARITAS ANNOUNCES ANTICIPATED LATE FILING OF ANNUAL DOCUMENTS
Claritas to miss deadline for 2021 results
2022-04-29 17:59 ET - News Release
Mr. Robert Farrell reports
CLARITAS ANNOUNCES ANTICIPATED LATE FILING OF ANNUAL DOCUMENTS
Claritas Pharmaceuticals Inc. anticipates being late in the filing of its annual documents.
The company's annual audit financial statements for the fiscal year ending December 31, 2021, annual management discussion & analysis for the fiscal year ending December 31, 2021, and CEO & CFO certificates related to the foregoing (collectively, the "Annual Documents") are due by May 2, 2022. Although the Company is working with its auditors to complete the audit, it is anticipated that it will not be able to meet filing deadline for the Annual Documents and as a result it will be in default of filing the Annual Documents by the deadline (the "anticipated default"). The Issuer expects to file the Annual Documents by July 1, 2022, but continues to work expediently to address the anticipated default earlier.
Due to the scope of the Issuer's activities geographically and operationally its audit is involved and costly. Although the auditors have been paid their initial fee for the audit comprising approximately 50% of their fees, the Issuer had to make the difficult decision to use funds earlier earmarked for the balance of the audit fee to be allocated instead for research and development expenses for the Company's ongoing Phase 1 clinical study in Australia. If it had not done so it would have faced research and development delays.
The Issuer had expected to cover the shortfall subsequently, and has made and continues discussions to secure additional financing, however, as of today's date, it has been unable to secure such financing on acceptable terms. The Issuer is currently in discussions to secure bridge financing. These have been informal discussions that have not reached any level of materiality and no agreements have been entered into between the Issuer and other parties for the same; however, there continues to be strong interest expressed by these parties and it is reasonable that the Issuer will be able to secure financing to be able to address the shortfall for its audit fees.
The Issuer expects that it would be able to fund its shortfall and be able to pay the audit fees to have the audited documents released and be able to post the Annual Documents 2 months following the May 2, 2022 deadline. As such, to be conservative and assuming a less than ideal turn of events, the Issuer expects to file the Annual Documents by July 1, 2022. The Issuer intends to undertake a bridge financing to address immediate financing needs, and then pursue long term financing opportunities for its long term capital needs.
The Company has applied to the applicable Canadian securities regulatory authorities for a management cease trade order ("MCTO"). There is no certainty that the MCTO will be granted.
Until the Annual Documents are filed, the Company intends to satisfy the provisions of the alternative information guidelines in accordance with National Policy 12-203 - Management Cease Trade Orders by issuing bi-monthly status reports in the form of news releases.
An MCTO once granted will prevent the Company's management and certain other insiders as required by the regulators from trading in the securities of the Company until the default in relation to the MCTO has been addressed, allowing the Company time to address the anticipated default while not interrupting the regular activities of public shareholders and other securityholders of the Company.
The applicable Canadian securities regulatory authorities may issue a general cease trade order against the Company for failure to file the Annual Documents within the prescribed time period or sooner if the Company fails to file its status report during the prescribed time limits. There are no insolvency proceedings that the Company is subject to and there is no other material information concerning the affairs of the Company that has not been previously disclosed.
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