UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): January 18, 2024
Canopy Growth Corporation
(Exact name of registrant as specified in its charter)
| Canada | | 001-38496 | | N/A |
(State or other jurisdiction
of incorporation) | | (Commission
File Number) | | (IRS Employer
Identification No.) |
1 Hershey Drive
Smiths Falls, Ontario | K7A 0A8 |
| (Address of principal executive offices) | (Zip Code) |
(855) 558-9333
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading
Symbol(s) | Name of each exchange
on which registered |
| Common Shares, no par value | CGC | Nasdaq Global Select Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Item 1.01 Entry Into a Material Definitive Agreement.
On January 18, 2024, Canopy Growth Corporation (the “Company”), entered into Subscription Agreements (collectively, the “Subscription Agreements”) with certain institutional investors (collectively, the “Investors”) pursuant to which the Company agreed sell to the Investors an aggregate of 8,158,510 units (each a “Unit” and, collectively, the “Units”) of the Company at a price of $4.29 per Unit in a private placement (the “Private Placement”) for aggregate gross proceeds of approximately US$35,000,000. The Private Placement closed on January 19, 2024 (the “Closing Date”).
Each Unit is comprised of (a) one common share of the Company (a “Common Share”) and (b)(i) one Series A Common Share purchase warrant (a “Series A Warrant”) or (ii) one Series B Common Share purchase warrant (a “Series B Warrant” and, together with the Series A Warrants, the “Warrants”). Each Warrant entitles the holder to acquire one Common Share from the Company at a price equal to US$4.83. The Series A Warrants are currently exercisable and will remain exercisable for a period of five years from the Closing Date, and the Series B Warrants are exercisable for a period commencing on the date that is six-months following the Closing Date and ending on the date that is five years following such date. The Company has also agreed to provide the Investors with customary registration rights pursuant to the Registration Rights Agreement (as defined below).
After the payment of the fees payable to the Placement Agents (as defined below) and estimated offering expenses payable by the Company in connection with the Private Placement, the Company received net proceeds of approximately $32.5 million (assuming no exercise of Warrants). The Company intends to use the net proceeds from the Private Placement to pay down debt as well as for working capital and other general corporate purposes.
The Subscription Agreements include standard representations, warranties and covenants of the Company and the Investors, including certain restrictions on future issuances of Common Shares.
In connection with the Private Placement, the Company entered into a registration rights agreement (the “Registration Rights Agreement”) with the Investors on the Closing Date, pursuant to which the Company agreed to file a registration statement with the Securities and Exchange Commission (the “SEC”) to register for resale the Common Shares issued as part of the Units and the Common Shares issuable upon exercise of the Warrants as soon as reasonably practicable following the Closing Date, with such registration statement to be declared effective by the SEC within five trading days after the SEC staff informs the Company that it will not review such registration or, if such registration statement is subject to full review by the SEC, as soon as reasonably practicable after the initial filing date of such registration statement.
A.G.P./Alliance Global Partners (“A.G.P.”) and ATB Capital Markets USA Inc. (“ATB”, and together with A.G.P., the “Placement Agents”) acted as placement agents with respect to the Private Placement.
The foregoing descriptions of the Series A Warrants, the Series B Warrants, the Subscription Agreements and the Registration Rights Agreement do not purport to be complete and are qualified by reference to the full text of such agreements, which are attached to this Current Report on Form 8-K (“Current Report”) as Exhibits 4.1, 4.2, 10.1 and 10.2, respectively, and are incorporated herein by reference.
Item 3.02 Unregistered Sales of Equity Securities.
The disclosures set forth in Item 1.01 above and the first paragraph of Item 8.01 below related to the Private Placement are incorporated by reference into this Item 3.02. The issuance of the Common Shares and the Warrants underlying the Units and the Common Shares underlying the Warrants were made in reliance on the exemption from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended.
Item 8.01 Other Events.
In connection with the Private Placement, the Company entered into an engagement letter with the Placement Agents (the “Engagement Letter”), pursuant to which the Company agreed to pay the Placement Agents a cash fee equal to 4.5% of the gross proceeds received by the Company in the Private Placement, in addition to reimbursement for reasonable expenses. The Engagement Letter contains customary representations, warranties, terms and conditions, including for indemnification of the Placement Agents by the Company.
On January 18, 2024, the Company issued a press release announcing the Private Placement. A copy of the press release is attached to this Current Report as Exhibit 99.1 and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
* Certain of the exhibits and schedules to this exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5). The registrant agrees to furnish supplementally a copy of all omitted exhibits and schedules to the SEC upon its request.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| | CANOPY GROWTH CORPORATION |
| | |
| Dated: January 19, 2024 | By: | /s/ Judy Hong |
| | | Judy Hong
Chief Financial Officer |
