Creation of U.S. holding company and
exchangeable share structure designed to enable Canopy USA to trigger full ownership of U.S. cannabis
investments and capitalize on market opportunity projected to be
over $50B1 by 2026
Floating Share Arrangement Agreement
facilitates acquisition of 100% of Acreage Holdings
Additional balance sheet actions reduce costs
and create flexibility to pursue strategic growth
opportunities
SMITHS
FALLS, ON, Oct. 25, 2022 /CNW/ - Canopy Growth
Corporation ("Canopy" or the "Company") (TSX: WEED)
(NASDAQ: CGC) today announced a strategy to accelerate its entry
into the U.S. cannabis industry and unleash the value of its full
U.S. cannabis ecosystem through the creation of a new
U.S.-domiciled holding company, Canopy USA, LLC ("Canopy USA") and the execution of a deliberate
and highly-structured process. Canopy USA will hold the Company's U.S. cannabis
investments, which will enable it to exercise rights to acquire
Acreage (as defined below), Wana (as defined below) and Jetty (as
defined below).
"As the growth of the U.S. cannabis market continues rapidly at
the state level, this strategy enables us to take control of our
own destiny and capitalize on the once-in-a-generation opportunity
in the largest cannabis market in the world," said David Klein, Chief Executive Officer of Canopy
Growth Corporation. "We expect to unleash the full power of
Canopy's scalable and ideally-positioned U.S. cannabis ecosystem to
unlock potential expansion opportunities. This strategy and
positioning are true differentiators, which we expect to enable our
investors and brands to realize value in the near term while
positioning Canopy for profitable growth and a fast start upon U.S.
federal permissibility."
Strategic Highlights
- Fast-tracks entry into the world's largest and fastest
growing cannabis market: The U.S. is projected to be an over
$50 billion1 market
opportunity, and this strategy aims to unlock the ability to
capture share and return on investments made to date. Through these
"stepping stone" transactions, Canopy will be strategically
repositioned to capitalize on the benefits of complete ownership
and control of its U.S. THC portfolio of assets upon U.S. federal
permissibility.
- Establishes industry-leading, premium-focused brand
powerhouse: Canopy USA's
portfolio includes some of the most recognized, iconic cannabis
brands in the U.S. that the Company believes are ideally positioned
in the fastest growing categories, such as edibles, vapes, and
flower. Canopy USA is expected to
leverage the best of each brand's offerings to accelerate growth
and market expansion as key states across the country continue to
allow recreational cannabis usage, realizing value in the near
term.
- Highlights the value of Canopy's U.S. THC investments:
Canopy and Canopy USA,
collectively, are expected to rank among the top cannabis companies
in North America by
revenue.2 With a protective layer in place for
Canopy's core businesses, including its Canadian and international
cannabis operations, STORZ & BICKEL, BioSteel, and This Works,
Canopy is expected to consolidate the financial performance of
Canopy USA in accordance with U.S.
GAAP, enabling Canopy to highlight the value of its U.S. THC assets
to investors.
- Financial benefit via revenue and cost synergies within
Canopy USA and across Canopy:
The consolidation of U.S. cannabis assets is expected to generate
revenue and cost synergies by leveraging the brands, routes to
market, and operations of the full U.S. cannabis
ecosystem.
______________________________
|
1
|
MJBiz market forecast
of total US cannabis market by 2026. All financial figures in this
press release are in USD unless otherwise specified.
|
Canopy's U.S. Cannabis
Ecosystem
Canopy's U.S. cannabis ecosystem has an established presence
across large-scale and rapidly developing adult-use markets.
Collectively, this footprint currently spans 21 states3:
Arizona, Arkansas, California, Colorado, Connecticut, Florida, Illinois, Maine, Maryland, Massachusetts, Michigan, Missouri, Nevada, New
Hampshire, New Jersey,
New Mexico, New York, Pennsylvania, Ohio, Oklahoma, and Oregon.
Canopy USA will have interests
in the following assets, among others:
- Acreage – The shares to be acquired upon the exercise of
the option to acquire approximately 70% of the total shares of
Acreage Holdings, Inc. ("Acreage") at a fixed share exchange
ratio of 0.3048 of a common share of the Company (each whole share,
a "Canopy Share"), as well as an option to purchase the
remaining approximately 30% on a floating basis in order to own
100% of Acreage. A leading vertically integrated multi-state
cannabis operator, Acreage has its main operations in densely
populated states across the Northeast including New Jersey and New
York. Through its well-known national retail brand, The
Botanist, Acreage engages U.S. cannabis consumers and delivers a
range of award-winning products through The Botanist brand, and a
portfolio of high-impact, quality brands like Superflux, as well as
the Prime medical brand in Pennsylvania, and the Innocent brand in
Illinois among others.
- Wana – The option to acquire 100% of the membership
interests of Mountain High Products, LLC, Wana Wellness, LLC and
The Cima Group, LLC (collectively, "Wana"), a leading
cannabis edibles brand in North
America. Wana is vertically integrated in Colorado and has a rapidly growing licensing
division across 13 additional states while also holding the #1
market share position in Canada.4 With a scalable business
model, Wana has built a dominant position in the gummies category,
which is one of the fastest growing edibles segments.5
Backed by a robust pipeline of new consumer focused products, Wana
is entering new markets to capture consumers looking for
high-quality products that deliver against desired need
states.
- Jetty – The option to acquire 100% of the shares of
Lemurian, Inc. ("Jetty"), a California-based producer of high-quality
cannabis extracts and pioneer of clean vape technology. Leaders in
solventless vapes and a Top 10 California Brand6, Jetty
pioneers the latest technology to create industry-leading extracts
including award-winning solventless vapes, live resin vapes, and
other products. Supported by nine years of operations, Jetty
represents a critical foothold in the largest THC market in the
U.S. and is primed to scale its high-quality products
nationally.
In addition, Canopy USA
controls a conditional ownership position, assuming conversion of
its exchangeable shares and the exercise of its option but
excluding the exercise of its warrants, of approximately 13.7% in
TerrAscend Corp. (CSE: TER, OTCQX: TRSSF) ("TerrAscend"), a
leading North American cannabis operator with vertically
integrated operations and a presence in Pennsylvania, New
Jersey, Michigan, and
California as well as licensed
cultivation and processing operations in Maryland. Canopy USA's direct and indirect interests in
TerrAscend includes control over all exchangeable shares, options,
and warrants previously held by Canopy in TerrAscend as well as the
debentures and loan agreement outstanding between Canopy and
certain TerrAscend subsidiaries.
_________________________________
|
2
|
Based on internal
estimates.
|
3
|
Does not include Puerto
Rico where Wana has a presence.
|
4
|
Source: Hifyre data for
the second quarter of 2022 Canadian recreational market edibles
market share.
|
5
|
Source: Headset data
for tracked US states. Edibles includes forms such as beverages,
chocolates and other ingestibles.
|
Ownership of U.S. Cannabis
Investments
The shares and interests in Acreage, Wana, Jetty, and TerrAscend
will be held, directly or indirectly, by Canopy USA, and Canopy will not hold a direct
interest in any shares or interests in Acreage, Wana, Jetty, or
TerrAscend. Canopy holds non-voting and non-participating shares
(the "Non-Voting Shares") in the capital of Canopy
USA. The Non-Voting Shares do not
carry voting rights, rights to receive dividends or other rights
upon dissolution of Canopy USA but
are convertible into common shares of Canopy USA. To facilitate the creation of the
Non-Voting Shares, Canopy USA has
raised funds from a third-party investor and has agreed to issue
additional common shares of Canopy USA to the shareholders of Wana as additional
consideration in exchange for the option to acquire Wana and reduce
the future payments owed in connection with the exercise of the
option to acquire Wana to $3.00 (the
"Wana Amendments"). The value of the common shares of Canopy
USA to be issued to the
shareholders of Wana will be equal to 7.5% of the value of Wana as
of no earlier than January 1, 2023.
Canopy will have the right to convert its Non-Voting Shares for
common shares of Canopy USA and
Canopy USA retains a call right to
repurchase all common shares that have been issued to
third-parties.
Canopy and Canopy USA have also
entered into a protection agreement (the "Protection
Agreement") to provide for certain negative covenants in order
to preserve the value of the Non-Voting Shares held by the Company
until such time as Canopy controls Canopy USA. Canopy also has two designees on the
four-person board of managers of Canopy USA.
Upon closing of Canopy USA's
acquisition of Acreage, Canopy will receive additional Non-Voting
Shares from Canopy USA as
consideration for the issuance of Canopy Shares that shareholders
of Acreage will receive in accordance with the Existing Acreage
Arrangement Agreement (as defined below) and the Floating Share
Arrangement Agreement (as defined below).
In addition, subject to the terms and conditions of the
Protection Agreement and the terms of the option agreements to
acquire Wana and Jetty, Canopy may be required to issue additional
Canopy Shares in satisfaction of certain deferred and/or option
exercise payments to the shareholders of Wana and Jetty. Canopy
will receive additional Non-Voting Shares from Canopy USA as consideration for any Canopy Shares
issued in the future to the shareholders of Wana and Jetty.
Until such time as Canopy converts the Non-Voting Shares into
common shares of Canopy USA,
Canopy will have no economic or voting interest in Canopy
USA, Wana, Jetty, TerrAscend, or
Acreage. Canopy USA, Wana, Jetty,
TerrAscend, and Acreage will continue to operate independently of
Canopy.
In connection with the Wana Amendments, the Company has also
agreed to issue Canopy Shares to the shareholders of Wana with a
value equal to 7.5% of the value of Wana as of no earlier than
January 1, 2023, subject to certain
limitations. The Company has also agreed to register the resale
of the Canopy Shares issued in connection with the Wana
Amendments.
______________________________
|
6
|
Based on March 2022
BDSA data for dollars sold for all product categories.
|
Acreage Agreements
The Company has entered into an arrangement agreement with
Canopy USA and Acreage (the
"Floating Share Arrangement Agreement"), pursuant to which,
subject to approval of the holders of the Class D subordinate
voting shares of Acreage (the "Floating Shares") and the
terms and conditions of the Floating Share Arrangement Agreement,
Canopy USA will acquire all of the
issued and outstanding Floating Shares by way of a court-approved
plan of arrangement (the "Floating Share Arrangement") on
the basis of 0.45 of a Canopy Share in exchange for each Floating
Share held.
It is expected that the Floating Share Arrangement will be
effected by way of a court-approved plan of arrangement under the
Business Corporations Act (British
Columbia). The Floating Share Arrangement requires the
approval of: (i) at least two-thirds of the votes cast by the
holders of the Floating Shares; and (ii) at least a majority of the
votes cast by the holders of the Floating Shares, excluding the
votes cast by "interested parties" and "related parties" (as such
terms are defined in Multilateral Instrument 61-101 - Protection
Of Minority Security Holders In Special Transactions), at a
special meeting of Acreage shareholders expected to be held in
January 2023.
The Company has also agreed to issue Canopy Shares with a value
of $50 million to, among others,
certain unitholders (the "Holders") of High Street Capital
Partners, LLC, a subsidiary of Acreage ("HSCP"), in order to
reduce a potential liability of approximately $121 million pursuant to HSCP's amended tax
receivable agreement and the related tax receivable bonus plans.
Canopy Shares with a value of approximately $15 million will be issued to certain Holders as
soon as practicable as the first installment under this agreement
with a second payment of approximately $15
million in Canopy Shares to occur on the earlier of (a) the
second business day following the date on which the shareholders of
Acreage approve the Floating Share Arrangement; or (b) April 24, 2023. The final payment with a value of
approximately $20 million will be
issued immediately prior to completion of the Floating Share
Arrangement. The Company has also agreed to register the resale of
such Canopy Shares under the Securities Act of 1933, as amended. In
addition, a wholly-owned subsidiary of the Company ("Acreage
Debt Optionholder") has also agreed to acquire an option to
purchase the outstanding principal of Acreage's debt, being an
amount up to $150 million (the
"Acreage Debt") from Acreage's existing lenders (the
"Lenders") in exchange for an option premium payment of
$28.5 million (the "Option
Premium"). The Acreage Debt Optionholder will have the right to
exercise its option at its discretion, and the Option Premium will
be used towards settlement of the outstanding principal of Acreage
debt. In the event that Acreage repays the Acreage Debt on or prior
to maturity, the Option Premium will be returned to the Acreage
Debt Optionholder. In the event that Acreage defaults on the
Acreage Debt and the Acreage Debt Optionholder does not exercise
its option to acquire the Acreage Debt, the Option Premium will be
released to the Lenders.
Canopy and Canopy USA have
entered into voting support agreements with certain of Acreage's
directors, officers, and consultants pursuant to which such persons
have agreed, among other things, to vote their Floating Shares in
favor of the Floating Share Arrangement, representing approximately
7.3% of the issued and outstanding Floating Shares.
In addition to shareholder and court approvals, the Floating
Share Arrangement is subject to approval of the Amendment Proposal
(as defined below) and applicable regulatory approvals including,
but not limited to, TSX approval and the satisfaction of certain
other closing conditions customary in transactions of this nature.
Assuming timely receipt of all necessary court, shareholder,
regulatory and other third-party approvals and the satisfaction of
all other conditions, closing of the acquisition of Acreage is
expected to occur in late 2023.
It is intended that the Company's existing option to acquire the
Class E subordinate voting shares of Acreage (the "Fixed
Shares") on the basis of 0.3048 of a Canopy Share per Fixed
Share will be exercised after the Meeting (as defined below) in
accordance with the terms of the arrangement agreement dated
April 18, 2019, as amended on
May 15, 2019, September 23, 2020 and November 17, 2020 (the "Existing Acreage
Arrangement Agreement"). Canopy will not hold any Fixed Shares
or Floating Shares.
Completion of the acquisition of the Fixed Shares following
exercise of the option is subject to the satisfaction of certain
conditions set forth in the Existing Acreage Arrangement Agreement.
The acquisition of the Floating Shares pursuant to the Floating
Share Arrangement is anticipated to occur concurrently with the
acquisition of the Fixed Shares pursuant to the Existing Acreage
Arrangement Agreement in late 2023 such that 100% of the issued and
outstanding shares of Acreage will be owned by Canopy USA on closing of the acquisition of both the
Fixed Shares and the Floating Shares.
Special Shareholder
Meeting
In connection with the formation of Canopy USA, the Company is also pleased to announce
that it expects to hold a special meeting of shareholders in
January 2023 (the "Meeting").
At the Meeting, shareholders will be asked to consider a special
resolution authorizing an amendment to its articles of
incorporation (the "Amendment Proposal") to create a new
class of non-voting exchangeable shares in the capital of Canopy
(the "Exchangeable Shares"). The Exchangeable Shares will
not carry voting rights, rights to receive dividends or other
rights upon dissolution of Canopy but will be convertible into
Canopy Shares.
The Amendment Proposal must be approved by at least 66⅔% of the
votes cast on a special resolution by Canopy shareholders present
in person or represented by proxy at the Meeting. Greenstar Canada
Investment Limited Partnership ("Greenstar") and CBG
Holdings LLC ("CBG"), indirect, wholly-owned subsidiaries of
Constellation Brands, Inc. ("Constellation") (NYSE: STZ and
STZ.B), have entered into a voting and support agreement with
Canopy pursuant to which they have agreed to vote in favor of the
Amendment Proposal.
The Amendment Proposal provides all shareholders of Canopy with
the opportunity to self-assess their level of comfort with the
Company's exposure to the U.S. cannabis market. There is a risk
that the Company's interpretation of laws, regulations, and
guidelines, may differ from those of others, including those of
shareholders, government authorities, securities regulators, and
stock exchanges. The Exchangeable Shares provide shareholders that
may otherwise have concerns about the Company's exposure to the
U.S. cannabis market with an opportunity to retain an interest in
Canopy through a non-voting and non-participating share.
In the event that the Amendment Proposal is approved, Canopy
USA is expected to exercise the
options to acquire Wana and Jetty. If the Amendment Proposal is not
approved, Canopy USA will not be
permitted to exercise the rights to acquire Acreage, Wana or Jetty
and the Floating Share Arrangement Agreement will be terminated. In
such circumstances, Canopy will retain its option to acquire the
Fixed Shares under the Existing Acreage Arrangement Agreement and
Canopy USA will continue to hold
an option to acquire Wana and Jetty as well as exchangeable shares
in the capital of TerrAscend.
It is expected that the Company will file a proxy statement (the
"Proxy Statement") related to the Meeting later today with
the U.S. Securities and Exchange Commission (the "SEC"). A
full description of the Amendment Proposal will be included in the
Proxy Statement, which will be accessible by shareholders and filed
with the SEC through the Electronic Data Gathering, Analysis, and
Retrieval ("EDGAR") system at www.sec.gov/edgar and with the
Canadian securities regulators on the System for Electronic
Document Analysis and Retrieval ("SEDAR") at
www.sedar.com.
Balance Sheet Actions
The Company has entered into agreements with certain of its
lenders under its term loan credit agreement dated March 18, 2021 (the "Credit Agreement")
pursuant to which Canopy will tender US$187,500,000 of the principal amount
outstanding thereunder at a discounted price of US$930 per US$1,000
or US$174,375,000 in the aggregate
(the "Paydown"). The Paydown will be made in two equal
payments: the first payment on or about November 10, 2022, and the second payment on or
about April 17, 2023.
In connection with the Paydown, Canopy is also pleased to
announce that it has agreed with its lenders to amend certain terms
of the Credit Agreement (collectively, the "Amendments").
The Amendments include, among other things, reductions to the
minimum Liquidity (as defined in the Credit Agreement) covenant to
US$100,000,000, which is to be
reduced as payments are made in accordance with the Paydown,
certain changes to the application of net proceeds from asset sales
and the establishment of a new committed delayed draw term credit
facility in an aggregate principal amount of US$100,000,000. In addition, the Amendments
include the elimination of the additional US$500,000,000 incremental term loan
facility.
The Paydown is expected to reduce cash interest costs and enable
the Company to continue to pursue growth investments, acquisitions
and other strategic initiatives.
In addition, the Company also intends, following the creation of
the Exchangeable Shares, to negotiate an exchange agreement with
Greenstar to purchase for cancellation up to CAD$100 million principal amount of senior notes
of the Company due July 2023 (the
"Notes") in exchange for Exchangeable Shares, subject to the
rules and policies of the Nasdaq and the Toronto Stock Exchange. As
Canopy continues to work towards positive cashflow and sustained
profitable operations, the repurchase of the Notes in exchange for
Exchangeable Shares would preserve the Company's cash on hand and
reduce the Company's annual expenses.
Relationship with
Constellation
In connection with these proposed transactions, assuming
approval and adoption of the Amendment Proposal, Constellation has
expressed its current intention to convert all of its Canopy Shares
into Exchangeable Shares. However, any decision to convert will be
made by Constellation, and Constellation is not obligated to effect
any such conversion.
If Constellation elects to convert its Canopy Shares into
Exchangeable Shares, certain other transactions between Canopy and
Constellation will occur, including (i) CBG will surrender to the
Company for cancellation for no consideration all warrants to
purchase Canopy Shares held by CBG; (ii) the investor rights
agreement, administrative services agreement, co-development
agreement, and any and all other commercial arrangements between
Canopy and its affiliates, on the one hand, and Constellation and
its affiliates, on the other hand, will be terminated; (iii)
Constellation will no longer have the right to nominate persons to
the board of directors of Canopy (the "Board"), will no
longer have any approval rights over certain transactions proposed
to be undertaken by the Company, and restrictive covenants
previously agreed between the parties will terminate; and (iv) all
of Constellation's nominees that are currently serving on the Board
are expected to resign and new directors will be appointed to fill
the vacancies caused by their resignations.
In the event that Constellation does not convert its Canopy
Shares into Exchangeable Shares, Canopy USA will not be permitted to exercise the
rights to acquire Acreage, Wana or Jetty and the Floating Share
Arrangement Agreement will be terminated. In such circumstances,
Canopy will retain its option to acquire the Fixed Shares under the
Existing Acreage Arrangement Agreement and Canopy USA will continue to hold an option to acquire
Wana and Jetty as well as exchangeable shares and other securities
in the capital of TerrAscend. In addition, Canopy USA will exercise its repurchase rights to
acquire the interests in Canopy USA held by the third party investors.
Webcast and Q&A
Information
In support of this announcement, Canopy will host an audio
webcast with David Klein, CEO, and
Judy Hong, CFO, on October 25, 2022 at 8:30
AM Eastern Time.
The live audio webcast will be available at:
https://app.webinar.net/ANk8lRx2rwL.
A replay will be accessible by webcast until 11:59 PM ET on January 4,
2023, at: https://app.webinar.net/ANk8lRx2rwL.
Approvals and
Recommendation
The strategy was approved by the board of directors of Canopy,
and the Canopy board of directors unanimously recommends that
Canopy shareholders vote in favor of the Amendment Proposal.
Advisors and Counsel
Greenhill & Co. Canada Ltd. is acting as financial advisor
to Canopy. Cassels Brock &
Blackwell LLP is acting as Canadian legal advisor to Canopy, and
Paul Hastings LLP and Dentons are acting as U.S. legal advisors to
Canopy. Laurel Hill Advisory Group is acting as strategic
shareholder advisor and proxy solicitation agent to Canopy.
About Canopy Growth
Canopy Growth (TSX:WEED, NASDAQ:CGC) is a world-leading
diversified cannabis and cannabinoid-based consumer product
company, driven by a passion to improve lives, end prohibition, and
strengthen communities by unleashing the full potential of
cannabis. Leveraging consumer insights and innovation, Canopy
Growth offers product varieties in high-quality dried flower, oil,
softgel capsule, infused beverage, edible, and topical formats, as
well as vaporizer devices by Canopy Growth and industry-leader
Storz & Bickel. Canopy Growth's global medical brand, Spectrum
Therapeutics, sells a range of full-spectrum products using its
colour-coded classification system and is a market leader in both
Canada and Germany. Through Canopy Growth's award-winning
Tweed banner, Canopy Growth reaches its adult-use consumers and has
built a loyal following by focusing on top quality products and
meaningful customer relationships. Canopy Growth has entered into
the health and wellness consumer space in key markets including
Canada, the U.S., and Europe through BioSteel sports nutrition, and
This Works skin and sleep solutions; and has introduced additional
hemp derived CBD products to the U.S. through its First & Free
and Martha Stewart CBD brands. Canopy Growth has an established
partnership with Fortune 500 alcohol leader Constellation
Brands.
Notice Regarding Forward-Looking
Information
This news release contains "forward-looking statements"
within the meaning of the U.S. 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 the Company 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 and uncertainties include
statements regarding the expected size of the U.S. cannabis market;
statements with respect to our ability to execute on our strategy
to accelerate the Company's entry into the U.S. cannabis industry,
capitalize on the opportunity for growth in the U.S. cannabis
sector and the anticipated benefits of such strategy, including the
ability to generate revenues and cost synergies; statements with
respect to the timing and outcome of the Floating Share
Arrangement; the anticipated benefits of the Floating Share
Arrangement; the issuance of additional Canopy Shares to satisfy
the payments to the Holders; the acquisition of an option to
acquire the Acreage Debt from the Lenders for the Option Premium;
the anticipated timing of the Acreage special meeting of
shareholders and the closing of the acquisition of Acreage; the
satisfaction or waiver of the closing conditions set out in the
Floating Share Arrangement Agreement and the Original Acreage
Arrangement Agreement, including receipt of all regulatory
approvals; the anticipated timing and occurrence of the Company's
exercise of the option to acquire the Fixed Shares and closing of
such transaction; the issuance of additional Canopy Shares to
satisfy any deferred and/or option exercise payments to the
shareholders of Wana and Jetty and the Non-Voting Shares issuable
to Canopy from Canopy USA in
consideration thereof; the issuance of additional Canopy Shares and
common shares of Canopy USA in
connection with the Wana Amendments, including the number and
timing of Canopy Shares and common shares of Canopy USA to be issued; expectations regarding
the potential success of, and the costs and benefits associated
with the formation of Canopy USA;
the anticipated timing and occurrence of the Meeting to approve the
Amendment Proposal; the timing of the Paydown and the
reduction in interest costs; the Company's ability to pursue growth
investments, acquisitions and other strategic initiatives; the
potential settlement of the Notes following the Meeting; the
potential conversion of Canopy Shares held by Constellation to
Exchangeable Shares, including the termination of the investor
rights agreement between Canopy and Constellation; the anticipated
timing of filing and mailing the Proxy Statement and the timing of
the Meeting; and expectations for other economic, business, and/or
competitive factors.
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 stock exchanges on which we are listed may disagree
with our interpretations of their policies, including that
financial consolidation of Canopy USA may be permissible in the event that
Canopy USA closes on the
acquisition of Wana, Jetty or the Fixed Shares of Acreage;
inherent uncertainty associated with projections; the
diversion of management time on issues related to Canopy
USA; expectations regarding future
investment, growth and expansion of operations; the time required
to prepare and mail meeting materials to Acreage shareholders; the
ability of the parties to receive, in a timely manner and on
satisfactory terms, the necessary regulatory, court and shareholder
approvals; the ability of the parties to satisfy, in a timely
manner, the other conditions to the completion of the Floating
Share Arrangement; risks related to the value of the Canopy Shares;
regulatory and licensing risks; changes in general economic,
business and political conditions, including changes in the
financial and stock markets and the impacts of increased rates of
inflation; legal and regulatory risks inherent in the cannabis
industry, including the global regulatory landscape and enforcement
related to cannabis, political risks and risks relating to
regulatory change; risks relating to anti-money laundering laws;
compliance with extensive government regulation and the
interpretation of various laws regulations and policies; public
opinion and perception of the cannabis industry; and such other
risks contained in the public filings of the Company filed with
Canadian securities regulators and available under the Company's
profile on SEDAR at www.sedar.com and with the U.S. Securities and
Exchange Commission through EDGAR at www.sec.gov/edgar, including
the Company's annual report on Form 10-K for the year ended
March 31, 2022.
In respect of the forward-looking statements and information,
the Company has provided such statements and information in
reliance on certain assumptions that they believe are reasonable at
this time. 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. Should one or more of the foregoing risks or
uncertainties materialize, or should assumptions underlying the
forward-looking information prove incorrect, actual results may
vary materially from those described herein as intended, planned,
anticipated, believed, estimated or expected. Although the Company
has attempted to identify important risks, uncertainties and
factors which could cause actual results to differ materially,
there may be others that cause results not to be as anticipated,
estimated or intended. 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 any 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.
Participants in the
Solicitation
Canopy and its directors and executive officers may be deemed
participants in the solicitation of proxies from Canopy
shareholders with respect to the Amendment Proposal. A list of the
names of those directors and executive officers and a description
of their interests in Canopy is contained in Canopy's definitive
proxy statement on Schedule 14A filed with the SEC on July 29, 2022 and is available free of charge at
the SEC's website at www.sec.gov, or by directing a request to
Canopy Growth Corporation, 1 Hershey Drive, Smiths Falls, Ontario, K7A 0A8 or by email to
invest@canopygrowth.com. Additional information regarding the
interests of such participants will be contained in the Proxy
Statement when it becomes available. Investors should read the
Proxy Statement when it becomes available because it will contain
important information.
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SOURCE Canopy Growth Corporation