On December 3, 2018, Canopy Growth Corporation entered into two agreements with 48North Cannabis Corp., a strategic investment financing and a supply agreement with 48North’s wholly-owned subsidiary DelShen Therapeutics Corp.
Under the financing agreement, Canopy will invest $3 million into 48North and receive 4,000,000 units at a price of $0.75 per unit. Each unit is comprised of one common share and one quarter common share purchase warrant. Each whole 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, subject to acceleration in certain circumstances.
Under the supply agreement, 48North will supply Canopy Growth with dried cannabis produced from high-grade genetics with a minimum of 1,200 kilograms deliverable over the next 12 months. The supply agreement also provides that Canopy Growth will work with 48North on a best-effort basis to establish a national retail presence for 48 North products in Tokyo Smoke and Tweed retail stores.
Cassels Brock acted for Canopy Growth with a deal team that included Jonathan Sherman and Alex Pizale (Business and Cannabis).