In connection with the launch of the More Life™ brand, Canopy Growth has issued shares of its newly-created subsidiary, the More Life Growth Company, to certain entities that are controlled by Drake. Drake holds a 60 percent ownership interest in the More Life Growth Company, with Canopy Growth retaining 40 percent ownership. The subsidiary owns an entity licensed by Health Canada for the cultivation, processing and sale of cannabis at a production facility in Scarborough, Ontario.
Canopy Growth and Drake entered into a shareholders agreement, investor rights agreements and other ancillary agreements to govern the operations of the More Life Growth Company. Canopy Growth has the right to nominate two members to the Board of Directors of More Life Growth Company. Under the terms of the joint venture, Canopy will manage all day-to-day operations and maintenance of the More Life facility and will retain the rights to distribute the product cultivated there.
Reed Smith’s team on the cross-border transaction was led by New York-based Partner Aron Izower and included James Tandler, Wayne Uffleman, Jeffrey Korenblatt, Kevin Gallagher, Stacy Lee, Eric Zwilling and Aaron Bourke.
The Aird & Berlis team acting on behalf of Drake was led by senior tax Partner Jack Bernstein and included Martin Kovnats, Francesco Gucciardo, Andrew Nicholls, Liam Tracey-Raymont and Faruk Gafic.