Star Metro - 1933 Industries Issues Reminder to Debenture Holders Ahead of December 22 Conversion Deadline and Highlights Positive Industry Developments

Please note that the Board of Directors has determined that the Company is unable to satisfy repayment of the debentures with a monetary payment because the Company requires liquidity to support its ongoing operations and maintain business continuity. Therefore, it is critical that debenture holders act promptly to ensure their conversion is processed by the deadline.

Conversion Is the Most Constructive Outcome for Debenture Holders and the Company

The Board of Directors believes that conversion of the debentures is the most constructive and value-preserving outcome for all parties involved. The 2024 Debentures are unsecured debt, meaning there is no collateral securing these obligations. Conversion of the 2024 Debentures into equity is in the best interests of all stakeholders, including debenture holders and shareholders. Conversion strengthens the Company's balance sheet, reduces financial risk, and positions the Company to continue executing its operating and growth strategy. Conversely, if the debentures are not converted, and the Company is unable to make the repayment, the Company may need to seek protection under the Companies' Creditor Arrangement Act, and in that case, the Company anticipates recovery for unsecured creditors, including the debenture holders, will be lower than the potential value of the shares.

Under the existing terms, debenture holders may convert their principal at $0.05 per unit, with each unit consisting of:

• One common share of the Company; and

• One common share purchase warrant exercisable at $0.05 per share until December 31, 2028, subject to certain accelerated expiry provisions.

All accrued and unpaid interest will be settled through the issuance of common shares in accordance with the debenture terms.

Debenture holders are urged to contact their brokers immediately to ensure they submit their conversion requests on or before December 22, 2025.

Positive Industry and Regulatory Developments

The Company is encouraged by the recent executive order signed by U.S. President Donald Trump on December 18, 2025, directing federal agencies to reclassify cannabis from a Schedule I to a Schedule III substance under the U.S. Controlled Substances Act. This significant regulatory development is seen as a step toward improving the operating environment for U.S. cannabis businesses, potentially alleviating certain tax burdens and improving access to banking services. While regulatory processes are ongoing, this reclassification could positively impact the cannabis industry by reducing administrative costs, improving tax treatment, and facilitating better financial access. The Company believes this development is an encouraging sign for the future growth prospects of 1933 Industries.

"We commend President Trump and his administration for the landmark executive order reclassifying cannabis as a Schedule III drug. This watershed moment in U.S. reform marks a formal federal acknowledgment of cannabis's medical utility and low abuse potential. The shift offers far-reaching benefits for patients, researchers, and consumers, while providing critical relief to state-licensed businesses by eliminating the IRS Section 280E tax penalty," said the Company's CEO Brian Farrell.

Furthermore, the administration's clarity regarding the hemp-derived CBD market creates significant new opportunities for the industry. In light of these developments, 1933 Industries is actively reviewing its Canna Hemp assets with the strategic goal of returning these products to the market.

Looking Ahead

With the continued support of its debenture holders and shareholders, the Company remains focused on executing its strategy, improving operational efficiencies, and building long-term value. The Board is confident that the successful conversion of the 2024 Debentures will help strengthen the Company's financial position, improve liquidity, and allow 1933 Industries to capitalize on future opportunities in the growing cannabis sector.

About 1933 Industries Inc.

1933 Industries is a Nevada-based licensed producer, focused on the cultivation and extraction of a large portfolio of cannabis consumer products in a variety of formats under its flagship brand, Alternative Medicine Association (AMA). Its product offerings are cultivated at the Company's 68,000 sq. ft. indoor facility and marketed directly to retail dispensaries. AMA branded flower, infused pre-rolls, and in-house boutique concentrates consistently rank as the top products sold in Nevada. For more information, please visit www.1933industries.com

For further information please contact:
Alexia Helgason, VP, Investor Relations
604-728-4407
[email protected]

Brian Farrell, Chairman and CEO
[email protected]

Neither the Canadian Securities Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Canadian Securities Exchange) accepts responsibility for the adequacy or accuracy of this release.

Notice regarding Forward Looking Statements: This news release contains forward-looking statements. The use of any of the words "anticipate", "continue", "estimate", "expect", "may", "will", "project", "should", "believe" and similar expressions are intended to identify forward-looking statements. Forward-looking information in this news release includes, but is not limited to, statements regarding: the Company's ability (or inability) to repay the 2024 Debentures at maturity; the Company's current intentions regarding the 2024 Debentures and their terms; the Company's exploration of strategic alternatives; and the potential for cross-defaults and other insolvency measures. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. These statements speak only as of the date of this news release. The Company provides no assurance that it will successfully navigate its current liquidity challenges or that any financing or strategic transaction will be available on acceptable terms or at all to assist the Company with its obligations. Actual results could differ materially from those currently anticipated due to a number of factors and risks including liquidity risks as the Company lacks the cash resources to pay the 2024 Debentures, refinancing risks, cross-default risks resulting from a default under the 2024 Debentures, litigation risks should holders seek to enforce their rights pursuant to the 2024 Debentures and various risk factors discussed in the Company's disclosure documents, which can be found under the Company's profile on www.sedar.com. 1933 Industries undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

SOURCE: 1933 Industries Inc.

View the original press release on ACCESS Newswire

P.Beaulieu--SMC