PyroGenesis Provides Update on AMF Investigation

MONTREAL, Aug. 31, 2023 (GLOBE NEWSWIRE) -- PyroGenesis Canada Inc. (http://pyrogenesis.com) (TSX: PYR) (NASDAQ: PYR) (FRA: 8PY), a high tech company (the “Company” or “PyroGenesis”) that designs, develops, manufactures and commercializes advanced plasma processes and sustainable solutions which are geared to reduce greenhouse gases (GHG), today provides an update regarding the previously reported investigation by the Autorité des marchés financiers (“AMF”), the securities regulatory authority in the Province of Quebec, being conducted in the context of applicable securities laws.

As previously disclosed, the Company understands the AMF has investigated certain actions taken by the President and Chief Executive Officer of the Company, Mr. P. Peter Pascali, in connection with a settlement agreement entered into on April 30, 2018 between the Company and Phoenix Haute Technology Inc. (“Phoenix”), a company controlled by the late father of Mr. Pascali, and ancillary transactions (the “2018 Phoenix Transactions”).

Pursuant to the terms of the board approved settlement agreement, and as further disclosed in the annual information form of the Company for the year ended December 31, 2020, available under the Company’s profile on SEDAR+ at www.sedarplus.ca, under “Interest of Management and Others in Material Transactions – Settlement of Claim”, the Company issued $3.7 million of units comprised of common shares and warrants to Phoenix in 2018, to settle a $5.5 million claim of Phoenix with respect to the unpaid portion of the consideration payable by the Company to Phoenix for an acquisition of intellectual property rights completed in 2011.

The AMF has initiated administrative proceedings against Mr. Pascali, Alan Curleigh, who is a director of the Company, and the Company, for actions taken in connection with the 2018 Phoenix Transactions. The AMF alleges that Mr. Pascali was in breach of section 199.1(2) of the Securities Act (Québec), that Mr. Pascali and the Company made misrepresentations in breach of sections 196 and 197 of the Securities Act (Québec), that Mr. Pascali and the Company failed to comply with certain disclosure obligations under applicable securities legislation, and that Mr. Pascali and Mr. Curleigh failed to comply with their fiduciary duties as directors of the Company. The AMF is seeking administrative penalties totaling $4.20 million against Mr. Pascali, and a disgorgement order of $9.57 million to the AMF also from Mr. Pascali. The AMF is also seeking administrative penalties totaling $550,000 against the Company. Separately, the AMF is also seeking orders prohibiting Mr. Pascali and Mr. Curleigh to act as an officer or director of a reporting issuer for 5 years.