UNITED
STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C.
20549
SCHEDULE
13D/1
Under the Securities Exchange Act of 1934
(Amendment No. 1)*
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Lowell Farms
Inc.
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(Name of Issuer)
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Subordinate Voting Shares
(Title of Class of Securities)
547572107
(CUSIP Number)
Kenneth G. Alberstadt
Akerman Senterfitt LLP
1251 Avenue of the Americas, 37th Floor
New York, NY 10020
(212) 880-3817
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(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
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August 19, 2022
(Date of Event Which Requires Filing of this Statement)
If
the filing person has previously filed a statement on Schedule 13G
to report the acquisition that is the subject of this Schedule 13D,
and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f)
or 240.13d-1(g), check the following box. ☐
Note: Schedules filed in paper format shall
include a signed original and five copies of the schedule,
including all exhibits. See §240.13d-7 for other parties to whom
copies are to be sent.
*
The remainder of this cover page shall be filled out for a
reporting person’s initial filing on this form with respect to the
subject class of securities, and for any subsequent amendment
containing information which would alter disclosures provided in a
prior cover page.
The information required on the remainder of this cover page shall
not be deemed to be “filed” for the purpose of Section 18 of the
Securities Exchange Act of 1934 (“Act”) or otherwise subject to the
liabilities of that section of the Act but shall be subject to all
other provisions of the Act (however, see the Notes).
Persons who respond to the collection of information
contained in this form are not required to respond unless the form
displays a currently valid OMB control number.
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CUSIP No. 547572107
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Page 2 of 8 Pages
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1
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NAMES OF REPORTING PERSONS:
BRIAN SHURE
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):
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2
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE
INSTRUCTIONS):
(a) ☐
(b) ☒
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3
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SEC USE ONLY:
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4
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SOURCE OF FUNDS (SEE INSTRUCTIONS):
PF
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5
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CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e):
☐
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6
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CITIZENSHIP OR PLACE OF ORGANIZATION:
UNITED STATES
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NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
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7
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SOLE VOTING POWER:
538,536
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8
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SHARED VOTING POWER:
34,523,792
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9
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SOLE DISPOSITIVE POWER:
538,536
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10
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SHARED DISPOSITIVE POWER:
34,523,792
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11
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:
35,052,318
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12
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CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES (SEE INSTRUCTIONS):
☐
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):
26.6%
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14
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TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):
IN
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CUSIP No. 547572107
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Page 3 of 8 Pages
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1
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NAMES OF REPORTING PERSONS:
AMBROSE CAPITAL HOLDINGS, LP
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):
84-3183692
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2
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE
INSTRUCTIONS):
(a) ☐
(b) ☒
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3
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SEC USE ONLY:
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4
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SOURCE OF FUNDS (SEE INSTRUCTIONS):
PF
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5
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CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e):
☐
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6
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CITIZENSHIP OR PLACE OF ORGANIZATION:
DELAWARE
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NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
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7
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SOLE VOTING POWER:
0
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8
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SHARED VOTING POWER:
23,049,135
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9
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SOLE DISPOSITIVE POWER:
0
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10
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SHARED DISPOSITIVE POWER:
23,049,135
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11
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:
23,049,135
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12
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CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES (SEE INSTRUCTIONS):
☐
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):
18.9%
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14
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TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):
OO
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CUSIP No. 547572107
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Page 4 of 8 Pages
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1
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NAMES OF REPORTING PERSONS:
AMTG HOLDINGS, LLLP
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):
32-0521908
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2
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE
INSTRUCTIONS):
(a) ☐
(b) ☒
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3
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SEC USE ONLY:
|
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4
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SOURCE OF FUNDS (SEE INSTRUCTIONS):
PF
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5
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CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e):
☐
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6
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CITIZENSHIP OR PLACE OF ORGANIZATION:
DELAWARE
|
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NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
|
7
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SOLE VOTING POWER:
0
|
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8
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SHARED VOTING POWER:
8,153,423
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9
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SOLE DISPOSITIVE POWER:
0
|
|
10
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SHARED DISPOSITIVE POWER:
8,153,423
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|
11
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:
8,153,423
|
|
12
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CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES (SEE INSTRUCTIONS):
☐
|
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):
7.6%
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14
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TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):
OO
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CUSIP No. 547572107
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SCHEDULE 13D/A
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Page 5 of 8 Pages
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Introduction
As of August 19, 2022, Lowell Farms Inc. (the “Company”) has
issued 202,590 super voting shares (the “Super Voting
Shares”) and 100,613,094 subordinate voting shares (the
“Subordinate Voting Shares”). The Super Voting Shares carry
1,000 votes per share and the Subordinate Voting Shares carry 1
vote per share. As of August 19, 2022, the Subordinate Voting
Shares represented approximately 33.2% of the voting power of our
outstanding voting securities and approximately 66.8% of the voting
power of our voting securities on a fully diluted basis, and the
Super Voting Shares represented approximately 66.5% of the voting
power of our outstanding voting securities and approximately 33.5%
of the voting power of our voting securities on a fully diluted
basis. Fully diluted calculations take into account Subordinate
Voting Shares issuable upon the conversion of outstanding
debentures, the redemption of Class B Common Shares of our
subsidiary, Indus Holding Company, and the exercise of outstanding
warrants and options and Subordinate Voting Shares subject to
unvested restricted stock units.
The Super Voting Shares are held by the former Chairman and Chief
Executive Officer of the Company (the “Super Voting
Shareholder”), who has entered into an agreement with the
Company to vote the Super Voting Shares in accordance with the
voting agreement described in Item 4 below and otherwise as
directed by the Company’s board of directors.
Item 1. Security and Issuer.
This Statement on Schedule 13D relates to the Subordinate Voting
Shares. The principal executive offices of the Company are located
at 19 Quail Run Circle, Suite B, Salinas, California 93907.
Item 2. Identity and Background.
(a) This Statement is being filed by Brian Shure, Ambrose Capital
Holdings, LP (“Ambrose Capital”) and AMTG Holdings, LLLP
(“AMTG” and, together with Mr. Shure and Ambrose Capital,
the “Reporting Persons”). Mr. Shure is the President of
Ambrose Capital Partners, LLC, which is the general partner of
Ambrose Capital. Mr. Shure is the President of AMTG Management,
Inc., which is the general partner of AMTG Holdings, LLLP.
(b) Each Reporting Person has its principal business address at
5050 Millwood Lane, NW, Washington, DC 20016.
(c) Mr. Shure is the Chief Financial Officer of the Company. The
Company is a California-based cannabis company with vertically
integrated operations including large scale cultivation,
extraction, processing, manufacturing, branding, packaging and
wholesale distribution to retail dispensaries.
Ambrose Capital is a family investment partnership for the benefit
of Mr. Shure and his immediate family members.
AMTG is a family investment partnership for the benefit of Mr.
Shure and his immediate family members.
(d) – (e) No Reporting Person has been: (i) convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors);
or (ii) a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction as a result of which,
he, she or it was or is subject to a judgment, decree or final
order enjoining future violations of, or prohibiting or mandating
activities subject to, Federal or State securities laws or finding
any violation with respect to such laws.
(f) Mr. Shure is a citizen of the United States.
Item 3. Source and Amount of Funds or Other
Consideration.
Mr. Shure holds options to acquire 468,750 Subordinate Voting
Shares that are exercisable or will become exercisable within 60
days from the date of this amendment. Such options were received as
compensatory grants from the Company. The funds used to acquire
beneficial ownership of all other securities that are the subject
of this Statement were personal funds of Mr. Shure, including funds
constituting capital contributions to Ambrose Capital and AMTG.
Item 4. Purpose of the Transaction.
Commencing April 13, 2020, the Company offered and sold (the
“2020 Convertible Debenture Offering”) an aggregate of
$16,075,738 in principal amount of debentures due October 13, 2023
(the “2020 Convertible Debentures”), each of which is
convertible into Subordinate Voting Shares at a $0.20 per share
conversion price, and warrants to purchase a number of Subordinate
Voting Shares equal to the number of shares underlying the 2020
Convertible Debentures, at an exercise price of $0.28 per share,
between July 1, 2020 and October 13, 2023 (the “2020 Convertible
Debenture Warrants”). The purpose of the 2020 Convertible
Debenture Offering was to refinance outstanding indebtedness of the
Company and to provide working capital for general corporate
purposes. Geronimo Central Valley Opportunity Fund, LLC
(“Geronimo Fund”) purchased an aggregate of $10,507,488 of
the 2020 Convertible Debentures and 2020 Convertible Debenture
Warrants in the offering. Ambrose Capital invested $1,000,000 in
Geronimo Fund.
On December 16, 2020, the Company completed a CDN $30,000,000
offering of Units, each Unit consisted of one Subordinate Voting
Share and one-half of one warrant (with each whole warrant
exercisable to purchase one Subordinate Voting Share for CDN $2.20
per share) (the “December 2020 Warrants”), at an offering
price of CDN $1.50 per Unit. The purpose of the offering was to
fund the development of a cultivation and production facility and
to provide working capital for general corporate purposes. Ambrose
Capital purchased CDN $273,000 of Units in the offering and AMTG
purchased $636,000 of Units in the offering. In addition, HSK
Holdings, LLC (“HSK”) purchased $127,200 of Units in the
offering. Mr. Shure is the Managing Member of HSK.
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CUSIP No. 547572107
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SCHEDULE 13D/A
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Page 6 of 8 Pages
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On August 30, 2021, the Company completed an $18,000,000 private
placement of Units, each Unit consisted of one Subordinate Voting
Share and one-half of one warrant (with each whole warrant
exercisable to purchase one Subordinate Voting Share for CDN $1.40
per share) (the “PIPE Warrants”), at an offering price of
$1.00 per Unit. The purpose of the offering was to provide working
capital for general corporate purposes. Ambrose Capital purchased
$1,700,000 of Units in the offering, AMTG purchased $400,000 of
Units in the offering and HSK purchased $100,000 of Units in the
offering. In addition, The Brian K. Shure Charitable Lead Annuity
Trust (the “Shure Trust”) purchased $300,000 of Units in the
offering. Mr. Shure is the sole trustee of the Shure Trust.
As of January 1, 2022, a portion of the Convertible Debentures and
Convertible Debenture Warrants held by Geronimo Fund were
distributed to certain investors in Geronimo Fund, including
Geronimo Capital, in redemption of their interests (the
“Geronimo Redemption”). As a result of the Geronimo
Redemption, Ambrose Capital acquired beneficial ownership of
Convertible Debentures convertible into 4,925,000 Subordinate
Voting Shares at a conversion price of $0.20 per share and
Convertible Debenture Warrants exercisable for 4,925,000
Subordinate Voting Shares at a conversion price of $0.28 per
share.
On August 19, 2022, offered and sold an aggregate of $4,215,526 in
principal amount of debentures due October 13, 2023 (the “2022
Convertible Debentures” and, together with the 2020 Convertible
Debentures, the “Convertible Debentures”), each of which is
convertible into Subordinate Voting Shares at a $0.2313 per share
conversion price, and warrants to purchase (a) a number of
Subordinate Voting Shares equal to the number of shares underlying
the 2022 Convertible Debentures, at an exercise price of $0.2613
per share, between August 19, 2022 and February 19, 2026 (the
“2022 Convertible Debenture Warrants” and, together with the
2020 Convertible Debenture Warrants, the “Convertible Debenture
Warrants”) and (b) a number of non-voting common shares of
Indus Holding Company (“Indus Exercise Shares”), a
subsidiary of the Company, equal to 1.5 times the number of
Subordinate Voting Shares underlying the 2022 Convertible
Debentures, at an exercise price of $0.2613 per share, between
August 19, 2022 and February 19, 2026 (the “Indus Warrants”
and, together with the 2022 Convertible Debenture Warrants, the
“2022 Warrants”). Provided that the Company has applied for
and obtained all necessary regulatory approvals (including, without
limitation, the approval of any stock exchange on which the
Subordinate Voting Shares are listed), (i) the Indus Warrants will
be exchangeable for 2022 Convertible Debenture Warrants on a
one-for-one basis and (ii) holders will be entitled to exchange any
outstanding Indus Exercise Shares for Subordinate Voting Shares on
a one-for-one basis. Ambrose Capital purchased $1,200,000 of 2022
Convertible Debentures and 2022 Warrants in the offering, AMTG
purchased $500,000 of 2022 Convertible Debentures and 2022 Warrants
in the offering and the Shure Trust purchased $300,000 of 2022
Convertible Debentures and 2022 Warrants in the offering.
Mr. Shure (in his capacity as Chief Financial Officer of the
Company or otherwise) and the other Reporting Persons may, from
time to time, communicate with the Company’s management, directors,
shareholders and other interested parties regarding matters of
mutual interest, including strategies designed to increase the
value of the Subordinate Voting Shares. The Reporting Persons may
from time to time acquire or dispose of additional Subordinate
Voting Shares in the open market, in privately negotiated
transactions or otherwise.
Except as set forth herein, none of the Reporting Persons has any
plans or proposals that relate to or would result in any of the
actions specified in subparagraphs (a) through (j) of Item 4 of
Schedule 13D.
Item 5. Interest in Securities of the Issuer.
(a) The following table sets forth the aggregate number and
percentage of Subordinate Voting Shares beneficially owned by each
Reporting Person. To the best knowledge of the Reporting Persons,
and except as described herein, none of Reporting Persons own or
beneficially own any additional Subordinate Voting Shares.
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Outstanding
Shares
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Shares
Underlying
Convertible
Debentures
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Shares
Underlying Convertible
Debenture Warrants
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Shares
Underlying December
2020 Warrants
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Shares
Underlying Options
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Shares
Underlying
PIPE Warrants
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Total
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Beneficial
Ownership
Percentage
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Brian Shure *
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3,250,576
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29,737,592
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29,737,592
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400,000
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468,750
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1,195,400
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35,052,318
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26.6%**
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Ambrose Capital
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1,882,000
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10,113,067
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10,113,067
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91,000
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-
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850,000
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23,049,135
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18.9%
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AMTG
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824,000
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3,458,712
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3,458,712
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-
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-
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412,000
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8,153,423
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7.6%
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*
Includes securities held by Ambrose, AMTG, the Shure Trust and
HSK.
** Based on 100,613,094 Subordinate Voting Shares outstanding as of
August 19, 2022.
(b) The following table sets forth the aggregate number and
percentage of Subordinate Voting Shares as to which each Reporting
Person exercises sole or shared beneficial ownership. Mr. Shure may
be deemed to share voting and dispositive power over the
Subordinate Voting Shares held or issuable upon the conversion or
exercise of securities held by each of the other Reporting
Persons.
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Sole Voting
and Dispositive Power
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Shared Voting
and Dispositive Power
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Total
Beneficial Ownership
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Beneficial
Ownership Percentage
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Brian Shure
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528,536
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34,523,792
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35,052,318
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26.6%
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Ambrose Capital
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-
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23,049,135
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23,049,135
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18.9%
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AMTG
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-
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8,153,423
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8,153,423
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7.6%
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(c) Except as described in Item 4, there have been no transactions
in the Company’s shares by the Reporting Persons during the past
sixty days.
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CUSIP No. 547572107
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SCHEDULE 13D/A
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Page 7 of 8 Pages
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(d) No person other than the Reporting Persons is known to have the
right to receive, or the power to direct the receipt of dividends
from, or proceeds from the sale of, the Subordinate Voting Shares
reflected on the cover pages to this Statement.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or
Relationships With Respect to Securities of Issuer
The information set forth in Item 4 herein is hereby incorporated
by reference.
Item 7. Material to be Filed as Exhibits
Exhibit A Joint Filing Agreement
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CUSIP No. 547572107
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SCHEDULE 13D/A
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Page 8 of 8 Pages
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SIGNATURE
After reasonable inquiry and to the best of the undersigned’s
knowledge and belief, each of the undersigned certifies as to
itself that the information set forth in this statement is true,
complete and correct.
Dated: August 23, 2022
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/s/ Brian Shure
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Brian Shure
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AMBROSE CAPITAL HOLDINGS, L.P., by Ambrose Capital
Partners, LLC, its general partner |
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By: |
/s/ Brian
Shure |
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Name:
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Brian Shure |
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Title: |
President |
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AMTG HOLDINGS, LLLP, by AMTG Management, Inc., its general
partner
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By:
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/s/ Brian Shure
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Name:
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Brian Shure
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Title:
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President
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EXHIBIT A
JOINT FILING AGREEMENT
The undersigned hereby agree jointly to prepare and file with
regulatory authorities a Statement on Schedule 13D reporting a
material change in facts, and any further amendments related
thereto, and hereby affirm that such Statement on Schedule 13D and
any such further amendments are being filed on behalf of each of
the undersigned in accordance with Rule 13d-1(k)(1) under the
Securities Exchange Act of 1934. This agreement may be executed in
two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the
same instrument.
Dated: August 23, 2022
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/s/ Brian Shure
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Brian Shure
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AMBROSE CAPITAL HOLDINGS, L.P., by Ambrose Capital Partners, LLC,
its general partner
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By:
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/s/ Brian Shure
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Name:
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Brian Shure
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Title:
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President
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AMTG HOLDINGS, LLLP, by AMTG Management, Inc., its general
partner
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By:
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/s/ Brian Shure
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Name:
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Brian Shure
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Title:
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President
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