SMITH FALLS, ON and TORONTO, Dec. 3,
2018 /CNW/ - Canopy Growth Corporation ("Canopy
Growth") (TSX: WEED) (NYSE: CGC) announced today that it has
entered into two agreements with 48North Cannabis Corp. ("48North")
(TSXV: NRTH) a strategic investment financing ("Financing
Agreement") and partnership and a supply agreement ("Supply
Agreement").
Under the Supply Agreement, 48North will supply Canopy Growth
with dried cannabis produced from high-grade, unique genetics,
grown at 48North's wholly-owned facility, DelShen Therapeutics
Corp. ("DelShen"). The total volume of the Supply Agreement is
estimated to be a minimum of 1,200 kilograms and deliverable over
the course of 12 months. The first 100-kilogram transfer under the
Supply Agreement is expected to ship from 48North's DelShen
facility to Canopy Growth by December 5,
2018.
Under the Financing Agreement, Canopy will invest $3 million into 48North and receive 4,000,000
Common Units ("Units") at $0.75 per
Unit. 48North will issue each Unit at $0.75 to Canopy Growth for $3 million, representing approximately 3.4% of
the issued and outstanding shares. Each Unit will be comprised of
one Common Share and one quarter Common Share Purchase Warrant
(each whole Common Share Purchase Warrant, a "Warrant"). Each full
Warrant will entitle the holder to acquire an additional Common
Share of 48North for a period of 12 months from the date of issue
at a strike price of $1.15, provided
that, the expiry of the warrants can be accelerated if the closing
price of 48North's common shares on the TSX Venture Exchange
("TSXV") is at least $1.50 for a
minimum of 10 consecutive trading days and a notice of acceleration
is provided, in accordance with the terms of the warrant, to a date
30 days after the date of the notice.
The Supply Agreement further states that Canopy Growth will work
with 48North on a non-binding but best-effort basis to establish a
national retail presence for its products in Tokyo Smoke and Tweed
stores.
"The strategic partnership between 48North and Canopy Growth, a
world-leading cannabis company, is a testament to the quality,
diversity and consistency of our production, as well as the
strength of our branding and product development," said
Alison Gordon, Chief Executive
Officer of 48North. "The $3 million
equity financing completes our $10
million private placement and will help us build out our
next generation of cannabis products. The Supply Agreement provides
significant near-term revenue, along with future retail
distribution options for 48North's branded cannabis,
cannabis-accessories and next-generation products."
"Through CraftGrow and Canopy Rivers we've always sought
supplemental sources of supply in order to offer customers a
diverse range of products," said Mark
Zekulin, President & Co-CEO, Canopy Growth. "By adding
48North to the broader repertoire we'll strengthen our ability to
bring exciting cannabis products to market. By acquiring a stake in
48North we recognize the strength of their management team and
their ability to successfully launch into the Canadian cannabis
market."
Here's to Future Growth.
About Canopy Growth
Canopy Growth is a
world-leading diversified cannabis and hemp company, offering
distinct brands and curated cannabis varieties in dried, oil and
Softgel capsule forms. From product and process innovation to
market execution, Canopy Growth is driven by a passion for
leadership and a commitment to building a world-class cannabis
company one product, site and country at a time. The Company has
operations in 12 countries across five continents. The Company is
proudly dedicated to educating healthcare practitioners, conducting
robust clinical research, and furthering the public's understanding
of cannabis, and through its partly owned subsidiary, Canopy Health
Innovations, has devoted millions of dollars toward cutting edge,
commercializable research and IP development. Through partly owned
subsidiary Canopy Rivers Corporation, the Company is providing
resources and investment to new market entrants and building a
portfolio of stable investments in the sector. From our historic
public listing on the Toronto Stock Exchange and New York Stock
Exchange to our continued international expansion, pride in
advancing shareholder value through leadership is engrained in all
we do at Canopy Growth. Canopy Growth has established partnerships
with leading sector names including cannabis icon Snoop Dogg,
breeding legends DNA Genetics and Green House seeds, and Fortune
500 alcohol leader Constellation Brands, to name but a few. Canopy
Growth operates ten licensed cannabis production sites with over
4.3 million square feet of production capacity, including over
500,000 square feet of GMP certified production space. For more
information visit www.canopygrowth.com.
About 48North
48North Cannabis
Corp. (TSXV: NRTH) is a vertically-integrated cannabis
company focused on the health and wellness market through
cultivation and extraction, as well as the creation of innovative,
authentic brands for next-generation cannabis products. 48North is
developing formulations and manufacturing capabilities for its own
proprietary products, as well positioning itself to contract
manufacture similar products for third
parties. 48North cultivates unique genetics from
the Netherlands at
its wholly-owned subsidiary, DelShen Therapeutics Corp.
("DelShen"), a Licensed Producer under the Cannabis Act. DelShen
is authorized to cultivate and sell cannabis as well as
extract oil from its 40,000 square foot indoor facility near
Kirkland Lake,
Ontario. 48North has a growing portfolio of brands that
include Latitude, a women's cannabis platform (explorelatitude.com)
and Mother & Clone, a rapid-acting sublingual cannabis
nanospray (momandclone.com).
On October 30, 2018 48North
announced a letter agreement for the acquisition of 2599708 Ontario
Inc. ("Good & Green"), a Licensed Producer under the Cannabis
Act. Good & Green has a 46,000 square foot indoor cultivation
and production facility in Brantford,
Ontario and recently submitted a cultivation license
application to Health Canada in connection with its 100-acre
outdoor farm in Southwest
Ontario.
Notice Regarding Forward Looking Statements
This news
release contains "forward-looking statements" within the meaning of
the United States Private Securities Litigation Reform Act of 1995
and "forward-looking information" within the meaning of applicable
Canadian securities legislation. Often, but not always, forward
looking statements and information can be identified by the use of
words such as "plans", "expects" or "does not expect", "is
expected", "estimates", "intends", "anticipates" or "does not
anticipate", or "believes", or variations of such words and phrases
or state that certain actions, events or results "may", "could",
"would", "might" or "will" be taken, occur or be achieved.
Forward-looking statements or information involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of Canopy Growth or its
subsidiaries to be materially different from any future results,
performance or achievements expressed or implied by the
forward-looking statements or information contained in this news
release. Examples of such statements include statements with
respect to future sources of supply needed to satisfy future market
needs. Risks, uncertainties and other factors involved with
forward-looking information could cause actual events, results,
performance, prospects and opportunities to differ materially from
those expressed or implied by such forward-looking information,
including the Company's ability to establish a retail presence for
48North products in its retail stores in Canada, or statements referring to 48North and
its management's ability to launch products successfully in the
Canadian market, and such risks contained in the Company's annual
information form dated June 28, 2018
and filed with Canadian securities regulators available on the
Company's issuer profile on SEDAR at www.sedar.com. Although the
Company believes that the assumptions and factors used in preparing
the forward-looking information or forward-looking statements in
this news release are reasonable, undue reliance should not be
placed on such information and no assurance can be given that such
events will occur in the disclosed time frames or at all. The
forward-looking information and forward-looking statements included
in this news release are made as of the date of this news release
and the Company does not undertake an obligation to publicly update
such forward-looking information or forward-looking information to
reflect new information, subsequent events or otherwise unless
required by applicable securities laws.
SOURCE Canopy Growth Corporation