A company with an operation in Abbotsford will have to attend a hearing brought on by the B.C. Securities Commission (BCSC) for alleged misrepresentation.
Affinor Growers Inc. is a vertical farming technology and greenhouse operations company that is publicly traded on the Canadian Securities Exchange. Its CEO, Nick Brusatore, lives in Abbotsford, where the company leases a 15,000-square-foot greenhouse. Their vertical farming system uses rotating vertical towers to maximize cost-effectiveness.
The BCSC announced in a press release on Jan. 28 that they believe Affinor, Brusatore and two other corporate officers misrepresented their company in two separate news releases in 2018. The other two named in the hearing documents are director Brian Kent Whitlock of Langley and chief financial officer Usama Zafar Chaudhry of Surrey.
“Affinor Growers Inc., which develops stacked indoor growing facilities and trades on the Canadian Securities Exchange, announced in two news releases in 2018 that it had raised or intended to raise approximately $4 million through a private placement,” a statement from BCSC said. (A private placement is a sale of stocks, bonds, or securities directly to a private investor, rather than as part of a public offering.)
“Affinor, however, did not disclose in either news release that it intended to retain only about $325,000, or approximately 8 per cent, of the proceeds, and intended to immediately spend $3,675,000 on consulting fees,” the statement explained.
Brusatore told The Abbotsford News that he has nothing to hide and will be explaining the situation of the company at the time he speaks to the commission.
“We weren’t trying to hide anything at all,” he said. “Everything was disclosed in our financials.”
He said the Abbotsford greenhouse operation has finally just started and there are strawberry plants in production, making the timing a hard hit for the startup.
“I am working tirelessly right now,” he said. “Affinor is very excited about its future and getting through this.”
The BCSC alleges that “by announcing the proceeds from the private financing but failing to disclose that it would not be keeping all of the funds … Affinor made statements to investors that it knew – or ought reasonably to have known – were misrepresentations.”
Brusatore and Whitlock were with Affinor when the first and second news releases were issued and Chaudhry was with the company when the second news release was issued.
The allegations have not been proven. The respondents are required to appear before the commission on March 24 if they wish to be heard before a hearing date is scheduled.
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