Paragon Pharmacies Limited
TSX VENTURE : PGN

Paragon Pharmacies Limited

August 24, 2009 09:00 ET

Paragon Announces Leadership Changes

KELOWNA, BRITISH COLUMBIA--(Marketwire - Aug. 24, 2009) - Paragon Pharmacies Limited ("Paragon" or the "Company") (TSX VENTURE:PGN) today announced that Ms. Lorraine McGrath, President, has resigned effective immediately and that Mr. Denis Taillieu has been appointed as the acting CEO of the Company. Mr. Taillieu is currently the interim CFO of the Company. The Board of Directors have initiated a process to recruit a CEO. The Board also announced that Ms. Kristal Kaye, CGA, Director of Finance and Administration, is responsible for accounting and finance.

Mr. Martin Weinberg, Chairman of the Board of Directors, noted that progress had been made in operational improvements over the last few months. The Company now needs to embark on increasing its revenues. As such, the Board is now seeking to recruit a CEO with a strong retail and merchandising background. "With the improvements made over the last several months, we believe now is the time to refocus the organization on revenue growth. The pharmacy industry is facing significant regulatory change and pharmacy retail is becoming increasingly competitive. We are confident that the progress made to date by the management team will continue under the direction of Mr. Denis Taillieu."

The Company also announced that it has renewed the advisory services agreement with Canterbury Park Management Inc. ("Canterbury") effective May 2009 for an indefinite term. This agreement, together with the Supplemental Advisory Agreement entered into with the Company as part of the terms of the conversion of the debenture in November 2008, allows the Company access to various advisory services including services of Canterbury executives. The Advisory Agreement provides for a maximum annual fee of $200,000. The Agreement is terminable by the Company on 60 days notice and by Canterbury on ten business days notice, after the earlier of November 30, 2009 or the appointment of a CEO. The Supplemental Advisory Agreement expires the month following the appointment of a permanent CEO. Canterbury has advised that the fee of $25,000 per month set out in the Supplemental Advisory Agreement will apply commencing July 1, 2009.

Paragon Pharmacies is building a pharmacy with our customers in mind. Headquartered in Kelowna, BC and currently employing over 400 staff, Paragon currently owns and operates 18 retail pharmacies and three central fill pharmacies throughout British Columbia, Alberta and Manitoba. Paragon is a leading mid-market pharmacy, providing premier pharmacy services in a friendly, community-focused environment.

FORWARD LOOKING STATEMENTS

This press release contains forward-looking statements regarding, among other things, the Company's beliefs, plans, objectives, strategies, estimates, intentions and expectations, including as they relate to its operating and financial results, capital expenditures and the ability to execute on its operating, investing and financing strategies. Consequently, actual results and events may differ materially from those included in, contemplated or implied by such forward looking statements for a variety of reasons. Forward-looking statements are subject to inherent risks and uncertainties including, but not limited to, market and general economic conditions, certain property and casualty risks, the ability to attract and retain pharmacists, the availability and terms of financing, changes in the Company's relationship with its key suppliers, competitive factors, changes in regulatory environments affecting the Company's business, and the accuracy in management's assumptions (see "RISKS AND RISK MANAGEMENT" as noted in the Company's Management's Discussion & Analysis posted on SEDAR at www.sedar.com). This list is not exhaustive of the factors that may affect any of the Company's forward-looking statements. Investors and others should carefully consider these and other factors and not place undue reliance on these forward-looking statements. In addition, these forward-looking statements relate to the date on which they were made and the Company disclaims and has no intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

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