Vancouver, British Columbia--(Newsfile Corp. - October 2, 2025) - Purebread Brands Inc. (TSXV: BRED) ("Purebread" or the "Company") announces that it has been granted an extension by its principal regulator, the British Columbia Securities Commission (the "BCSC"), for the existing management cease trade order (the "MCTO"). The MCTO, originally granted on July 31, 2025, has been extended from September 29, 2025, to October 3, 2025. The MCTO was issued because the Company was unable to file its audited annual financial statements, related MD&A, and CEO and CFO certifications for the year ended March 31, 2025 (the "Required Filings"), by the July 29, 2025, deadline. This resulted in a default under Part 4 of National Instrument 51-102 Continuous Disclosure Obligations ("Default").
The Company reports that its finance team and auditors have been working diligently over the past two months to complete the audit within the relief period. The audit is in progress and near completion. However, due to the complexity of certain accounting matters, the company requires additional time to complete the Required Filings. As a result, the Company applied to the BCSC for an extension, which has been granted until October 3, 2025. The Company also expects to file its Q1 interim financial statements for the period ended June 30, 2025, within five business days following submission of the Required Filings.
While the MCTO is in effect, the general investing public will continue to be able to trade freely in the Company's listed common shares. However, the Company's Interim Chief Executive Officer and Chief Financial Officer will not be able to trade the Company's shares.
Other than as disclosed in this news release, the Company also confirms that, at the date hereof, there are no insolvency proceedings against it and no other material information concerning the affairs of the Company that has not been generally disclosed as of the date of this press release.
Closing of First Tranche of Debt Settlement
Purebread is also pleased to announce that, further to the Company's news release on March 13, 2025, it has completed the first tranche of its previously announced shares for debt transaction (the "Debt Settlement") and issued to certain creditors of the Company an aggregate of 3,739,162 units (the "Units") at an average price of approximately $0.95 per Unit, in full and final settlement of accrued and outstanding indebtedness in the aggregate amount of $3,557,650. Each Unit consists of one common share (a "Common Share") and one-half of one Common Share purchase warrant (each whole warrant, a "Warrant"). Each Warrant entitles the holder to purchase one additional Common Share at a price of $2.50 per share for a period of 36 months from the date of issue. Immediately prior to the Debt Settlement, the Company had 23,187,101 Common Shares outstanding and following closing of the first tranche of the Debt Settlement, there are 26,926,263 Common Shares outstanding. The Company anticipates closing the second and final tranche of the Debt Settlement in following weeks in order to settle additional indebtedness of $619,850 through the issuance of 722,894 Units.
All securities issued in connection with the Debt Settlement are subject to a four-month hold period from the date of issuance in accordance with applicable Canadian securities laws, in addition to such other restrictions as may apply under applicable securities laws of jurisdictions outside Canada.
Related Party Transaction and Insider Participation
The issuance of Common Shares to Wevers Holdings Ltd. ("Wevers"), a creditor of the Company, is considered to be a "related party transaction" as defined under Multilateral Instrument 61-101 - Protection of Minority Securityholders in Special Transactions ("MI 61-101"). The issuance of Common Shares, as it relates to Wevers, is exempt from the minority approval and formal valuation requirements of MI 61-101 pursuant to subsections 5.5(a) and 5.7(1)(a) of MI 61-101. Immediately prior to closing of the Debt Settlement, Wevers held 1,447,418 Common Shares and securities convertible to acquire 2,377,059 Common Shares, reflecting an undiluted ownership interest of 6.25% and a partially diluted ownership interest of 14.97%. Wevers was issued 874,062 Units pursuant to the Debt Settlement and Wevers continues to be a related party on the basis of holding 2,321,480 Common Shares and securities convertible to acquire 2,814,090 Common Shares, reflecting an undiluted ownership interest of 8.63% and 17.28% of the issued and outstanding Comon Shares on a partially diluted basis.
A copy of Wevers' early warning report will appear on the Company's profile on SEDAR+.
As a result of the Debt Settlement, Zamano Holdings Ltd. ("Zamano"), is now an "insider" of the Company as defined under MI 61-101. Immediately prior to the closing of the Debt Settlement, Zamano held 1,438,511 Common Shares and nil convertible securities, reflecting an undiluted ownership interest of 6.21%. Zamano was issued 1,225,106 Units pursuant to the Debt Settlement and Zamano holds 2,663,617 Common Shares and securities convertible to acquire 612,553 Common Shares, reflecting an undiluted ownership interest of 9.90% and a partially diluted ownership interest of 11.91%.
A copy of Zamano's early warning report will appear on the Company's profile on SEDAR+.
About Purebread Brands Inc.:
Purebread Brands Inc. is a leader in fast-casual cafe / bakeries in British Columbia, driving retail expansion in vibrant communities across Canada and beyond. Purebread is committed to crafting exceptional food experiences and making a positive impact on the communities it serves.
For more information and updated investor presentation, please visit www.purebreadbrands.com or contact:
Amrit Maharaj, Interim Chief Executive Officer
(604) 889-5865
info@purebread.ca
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 news release.
Cautionary Note Regarding Forward-Looking Statements
This release includes certain statements and information that may constitute forward-looking information within the meaning of applicable Canadian securities laws. Forward-looking statements relate to future events or future performance and reflect the expectations or beliefs of management of the Company regarding future events. Generally, forward-looking statements and information can be identified by the use of forward-looking terminology such as "intends" or "anticipates", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "should", "would" or "occur". This information and these statements, referred to herein as "forward-looking statements", are not historical facts, are made as of the date of this news release and include without limitation, statements regarding filing of early warning reports by Wevers and Zamano, discussions of future plans, estimates and forecasts and statements as to management's expectations and intentions with respect to, among other things: the proposed closing of a second tranche of the Debt Settlement, and the anticipated timing thereof; management expectations regarding the Company's ability to file the Required Filings within the time period described herein.
These forward-looking statements involve numerous risks and uncertainties and actual results might differ materially from results suggested in any forward-looking statements. These risks and uncertainties include, among other things, the risks that: Wevers and Zamano will not file early warning reports on the timelines required by applicable law, the Company is unable to close the second tranche of the Debt Settlement or that the Company will be unable to do so on the timeline anticipated and the Company being unable to file the Required Filings within the proposed timeframe.
In making the forward looking statements in this news release, the Company has applied several material assumptions, including without limitation, that each of Wevers and Zamano will file early warning reports on the timelines required by applicable law, that TSX Venture Exchange approval for closing of the second tranche of the Debt Settlement will be obtained on the timeline anticipated by management and Management's expectations as to the Company's ability to file the Required Filings within the period specified herein.
Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information. Readers are cautioned that reliance on such information may not be appropriate for other purposes. The Company does not undertake to update any forward-looking statement, forward-looking information or financial out-look that are incorporated by reference herein, except in accordance with applicable securities laws.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/268859
SOURCE: Purebread Brands Inc.
