Payment of Filing Fee (check the appropriate box):
|
||||||
☐
|
| |
No fee required.
|
|||
☐
|
| |
Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
|
|||
|
| |
1.
|
| |
Title of each class of securities to which transaction applies:
|
|
| |
|
| |
|
|
| |
2.
|
| |
Aggregate number of securities to which transaction applies:
|
|
| |
|
| |
|
|
| |
3.
|
| |
Per unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
|
|
| |
|
| |
|
|
| |
4.
|
| |
Proposed maximum aggregate value of transaction:
|
|
| |
|
| |
|
|
| |
5.
|
| |
Total fee paid:
|
|
| |
|
| |
|
☒
|
| |
Fee paid previously with preliminary materials.
|
|||
☐
|
| |
Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
|
|||
|
| |
1.
|
| |
Amount Previously Paid:
|
|
| |
|
| |
|
|
| |
2.
|
| |
Form, Schedule or Registration Statement No.:
|
|
| |
|
| |
|
|
| |
3.
|
| |
Filing Party:
|
|
| |
|
| |
|
|
| |
4.
|
| |
Date Filed:
|
|
| |
|
| |
|
|
| |
|
Irwin D. Simon
Chief Executive Officer and Chair of the
Board of Directors of Aphria Inc.
|
| |
Brendan Kennedy
President, Chief Executive Officer, and Chair of
the Board of Directors of Tilray, Inc.
|
•
|
The combination of Aphria and Tilray will create the world’s largest global cannabis company with pro forma revenue of
US$685 million (C$874 million) for the last 12 months as reported by each company prior to the date of the announcement of the Transaction on December 16, 2020, the highest in the global cannabis industry.
|
•
|
The Combined Company is expected to have the strategic footprint and operational scale necessary to compete more effectively in
today’s consolidating cannabis market with a strong, flexible balance sheet, strong cash balance and access to capital which Aphria and Tilray believe will give it the ability to accelerate growth and deliver long-term sustainable value
for stockholders.
|
(1)
|
The relative ownership percentages as at the date of the announcement of the Transaction were
62% and 38%, respectively, but since the Exchange Ratio remains fixed, the relative ownership percentages have changed as a result of a share issuance by Tilray pursuant to an at-the-market offering on February 25, 2021.
|
•
|
Internationally, the Combined Company will be well-positioned to pursue growth opportunities with its strong medical cannabis
brands, distribution network in Germany and end-to-end European Union Good Manufacturing Practices (“EU-GMP”) supply chain, which includes its production facilities in Portugal and Germany.
|
•
|
In the United States, the Combined Company will have a strong consumer packaged goods presence and infrastructure with two
strategic pillars, including SweetWater Brewing Company, LLC, a leading cannabis lifestyle branded craft brewer, and Manitoba Harvest USA, LLC, a pioneer in branded hemp, CBD and wellness products with access to 17,000 stores in North
America. In the event of federal permissibility, the Combined Company expects to be well-positioned to compete in the U.S. cannabis market given its existing strong brands and distribution system in addition to its track record of growth
in consumer-packaged goods and cannabis products.
|
•
|
The combination of Aphria and Tilray is expected to deliver approximately US$78 million (C$100 million) of annual pre-tax cost
synergies within 24 months of the completion of the Transaction. The Combined Company expects to achieve cost synergies in the key areas of cultivation and production, cannabis and product purchasing, sales and marketing, and corporate
expenses.
|
•
|
Internet: Go to www.proxyvote.com and enter the 16-digit control number printed on the
form of proxy or voting instruction form or scan the QR Code on the Aphria form of proxy to access the website and follow the instructions on the screen.
|
•
|
Telephone: Call the toll-free telephone number provided on the form of proxy or voting
instruction form and follow the prompted voting instructions. You will need to enter the 16-digit control number.
|
•
|
Mail: Enter voting instructions, sign and date the form of proxy or voting instruction
form and return your completed form of proxy or voting instruction form in the enclosed postage paid envelope to:
|
•
|
Internet: Follow the instructions on the enclosed proxy card using the
control number printed on the form of proxy or voting instruction form and follow the instructions on the screen.
|
•
|
Telephone: Call the toll-free telephone number provided on the form of proxy
or voting instruction form and follow the prompted voting instructions.
|
•
|
Mail : Enter your voting instructions, sign and date the form of proxy or
voting instruction form and return the completed form of proxy or voting instruction form in the enclosed postage paid envelope.
|
1.
|
to consider and, if thought advisable, to pass a special resolution (the “ Aphria
Resolution ”), the full text of which is set forth in Appendix “C” to the accompanying joint proxy statement/management information circular (the “ Circular ”),
approving an arrangement (the “ Arrangement ”) pursuant to Section 182 of the Business Corporations Act (Ontario) (the “ OBCA ”) involving, among other things, the acquisition by Tilray, Inc. (“ Tilray ”), of all of the outstanding Aphria Shares, all as more
particularly described in the Circular, including in the section entitled “The Arrangement Agreement and Related Agreements” beginning on page 115 of the Circular, which resolution, to be effective,
must be passed by an affirmative vote of at least two-thirds of the votes cast at the Aphria Meeting by Aphria Shareholders either online, by proxy or by voting instruction form, as applicable; and
|
2.
|
to transact such further and other business as may properly be brought before the Aphria Meeting or any postponement or
adjournment thereof.
|
|
| |
BY ORDER OF THE BOARD OF DIRECTORS
|
|
| |
|
|
| |
(signed) “Irwin D. Simon”
|
|
| |
Irwin D. Simon
|
|
| |
Chief Executive Officer and Chair of the Board of Directors
|
1.
|
To consider and vote on a proposal to increase the authorized capital stock of Tilray from 743,333,333 shares to 900,000,000
shares of capital stock, consisting of 890,000,000 shares of Class 2 common stock and 10,000,000 shares of preferred stock, as reflected in the amendment to the second amended and restated certificate of incorporation of Tilray attached
as Appendix “F” to the Circular (the “Tilray Charter Amendment”), which is further described in the accompanying joint circular and proxy statement (the “Circular”) and a copy of the Tilray Charter Amendment is attached as Appendix “F” (the “Tilray Charter Amendment Proposal”).
|
2.
|
To consider and vote on a proposal to issue Tilray Class 2 common stock (the “ Tilray
Shares ”) to Aphria Shareholders pursuant to the arrangement agreement dated December 15, 2020, as amended on February 19, 2021 between Aphria Inc. and Tilray (the “ Arrangement
Agreement ”), which is further described in the Circular, including in the section entitled “The Arrangement Agreement and Related Agreements” beginning on page 115 of the Circular, and
a copy of the Arrangement Agreement is attached as Appendix “A” (the “ Tilray Share Issuance Proposal ”);
|
3.
|
To consider and approve, on an advisory (non-binding) basis, the compensation that may be paid to Tilray’s named executive
officers that is based on or otherwise relates to the transactions contemplated by the Arrangement Agreement, which is further described in the Circular, including in the section entitled “Interests of Tilray’s Directors and Management
in the Arrangement” beginning on page 96 of the Circular (the “ Tilray Advisory Compensation Proposal ”); and
|
4.
|
To approve the adjournment of the Tilray Meeting to a later date or dates, if necessary or appropriate, to solicit additional
proxies in the event there are not sufficient votes at the time of the Tilray Meeting to approve the Tilray Charter Amendment Proposal or the Tilray Share Issuance Proposal (the “Tilray Adjournment Proposal”).
|
|
| |
BY ORDER OF THE BOARD OF DIRECTORS
|
|
| |
|
|
| |
(signed) “Brendan Kennedy”
|
|
| |
Brendan Kennedy
|
|
| |
Chief Executive Officer
|
|
| |
Page
|
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| |
|
| |
Page
|
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| |
Q:
|
What are Aphria and Tilray proposing?
|
A:
|
Aphria and Tilray are proposing to combine their businesses pursuant to an Arrangement under the OBCA. Under the terms of the
Arrangement, Aphria Shareholders will receive 0.8381 of a Tilray Share for each Aphria Share. Tilray Stockholders will continue to hold their Tilray Shares, which will remain outstanding. The Transaction will, among other things, include
the following:
|
•
|
All outstanding Aphria Shares will be exchanged for Tilray Shares as described under “What will I receive for my shares under
the Arrangement?” below;
|
•
|
Tilray Stockholders will retain their Tilray Shares;
|
•
|
Aphria will become a wholly-owned subsidiary of Tilray; and
|
•
|
Tilray, a Delaware corporation, will make an amendment to its certificate of incorporation to implement the arrangement, all as
described in this Circular and if approved at the Tilray meeting;
|
Q:
|
Why are Aphria and Tilray proposing to combine?
|
A:
|
The Aphria Board and the Tilray Board each believe that, at this stage of development and expansion of the global cannabis
market, companies with financial strength, a strategic footprint and scale, a diverse product range, brand expertise and strong leadership are most likely to succeed in the long-term. The following are the key benefits of the combination:
|
•
|
World’s Largest Global Cannabis Company. The combination of Aphria and Tilray will
create the world’s largest global cannabis company with pro forma revenue of US$685 million (C$874 million) for the last 12 months as reported by each company prior to the date of the announcement of the Transaction on December 16, 2020,
the highest in the global cannabis industry.
|
•
|
Strategic Footprint and Operational Scale. The Combined Company is expected to have the
strategic footprint and operational scale necessary to compete more effectively in today’s consolidating cannabis market with a strong, flexible balance sheet, strong cash balance and access to capital, which Aphria and Tilray believe
will give it the ability to accelerate growth and deliver long-term sustainable value for stockholders.
|
(1)
|
The relative ownership percentages as at the date of the announcement of the Transaction were
62% and 38%, respectively, but since the Exchange Ratio remains fixed, the relative ownership percentages have changed as a result of a share issuance by Tilray pursuant to an at-the-market offering on February 25, 2021.
|
•
|
Low-Cost State-of-the-Art Production & The Leading Canadian Adult-Use Cannabis Producer.
The demand of the Combined Company will be supported by low-cost state-of-the-art cultivation, processing, and manufacturing facilities and it will have a complete portfolio of branded Cannabis 2.0 products in order to strengthen its
leadership position in Canada.
|
•
|
Positioned to Pursue International Growth. Internationally, the Combined Company will
be well-positioned to pursue growth opportunities with its strong medical cannabis brands, distribution network in Germany and end-to-end European Union Good Manufacturing Practices (“EU-GMP”)
supply chain, which includes its production facilities in Portugal and Germany.
|
•
|
Enhanced Consumer Packaged Goods Presence and Infrastructure in the U.S. In the United
States, the Combined Company will have a strong consumer packaged goods presence and infrastructure with two strategic pillars, including SweetWater, a leading cannabis lifestyle branded craft brewer, and Manitoba Harvest, a pioneer in
branded hemp, CBD and wellness products with access to 17,000 stores in North America. In the event of federal permissibility, the Combined Company expects to be well-positioned to compete in the U.S. cannabis market given its existing
strong brands and distribution system in addition to its track record of growth in consumer-packaged goods and cannabis products.
|
•
|
Substantial Synergies. The combination of Aphria and Tilray is expected to deliver
approximately US$78 million (C$100 million) of annual pre-tax cost synergies within 24 months of the completion of the Transaction. The Combined Company expects to achieve cost synergies in the key areas of cultivation and production,
cannabis and product purchasing, sales and marketing and corporate expenses.
|
Q:
|
What will I receive for my shares under the Arrangement?
|
A:
|
Aphria Shareholders. Under the Arrangement and subject to the terms of the Plan of
Arrangement, each Aphria Shareholder will receive, for each Aphria Share held, 0.8381 of a Tilray Share. You will no longer own any Aphria Shares, but instead will own Tilray Shares. As an example, if you owned 1,000 Aphria Shares on the
closing day of the Transaction, after the closing, you will own 838 Tilray Shares (since no fractional Tilray Shares are issued).
|
Q:
|
Why am I receiving 0.8381 of a Tilray Share for each of my Aphria Shares?
|
A:
|
The agreed Exchange Ratio is 0.8381. This means that upon completion of the Arrangement, each holder of Aphria shares will
receive 0.8381 of a Tilray Share for each Aphria Share. Since Tilray currently has approximately 188,932,853 shares outstanding and Aphria has approximately 360,461,839 shares outstanding, each on a fully diluted basis, on the closing
of the Transaction, it is expected (based on the shares of Tilray and Aphria issued and issuable as of March 12, 2021) that the Exchange Ratio will result in Aphria Shareholders owning approximately 61.2% of the outstanding shares of
Tilray, and existing Tilray Stockholders owning approximately 38.8% of the outstanding shares of Tilray. (2) If there is no change in the issued and outstanding share numbers prior to closing, Tilray is expected
to issue and make available for issuance an aggregate of approximately 298,450,205 new shares to Aphria Shareholders (298,450,205 / (188,932,853 + 298,450,205 = 61.2%) in exchange for their Aphria Shares (calculated using the treasury
stock method).
|
|
| |
|
(2)
|
The relative ownership percentages as at the date of the announcement of the Transaction were
62% and 38%, respectively, but since the Exchange Ratio remains fixed, the relative ownership percentages have changed as a result of a share issuance by Tilray pursuant to an at-the-market offering on February 25, 2021.
|
(3)
|
This graph assumes no change in the number of current issued and outstanding shares.
|
|
| |
|
Q:
|
How do I calculate the value of the Tilray Shares that I receive?
|
A:
|
The value of the Tilray Shares that you will receive on closing of the Transaction in exchange for your Aphria Shares will
depend on the trading price of Tilray Shares on the day the Transaction is completed. To help you value what you will receive under the Transaction for your Aphria Shares, see the example below:
|
•
|
The value of each Tilray Share is US$20.00.
|
•
|
1 US dollar = 1.2756 Canadian dollar
|
•
|
You own 1,000 Aphria Shares
|
Q:
|
Will I receive fractional Tilray Shares?
|
A:
|
No. If the total number of Tilray Shares that you will be entitled to receive would result in a fraction of a Tilray Share
being issuable, the number of Tilray Shares you will receive will be rounded down to the nearest whole Tilray Share.
|
Q:
|
What approvals are required for the Arrangement to be implemented?
|
A:
|
The completion of the Arrangement requires the approval from the Aphria Shareholders and the Tilray
|
Q:
|
When will the Arrangement become effective?
|
A:
|
Subject to obtaining the approvals described above, as well as the satisfaction or waiver of all other conditions precedent
set out in the Arrangement Agreement, it is anticipated that the Arrangement will be completed on or about April 20, 2021.
|
Q:
|
What will happen to Aphria if the Arrangement is completed?
|
A:
|
If the Arrangement is completed, Tilray will acquire all outstanding Aphria Shares and Aphria will become a wholly-owned
subsidiary of Tilray. Tilray intends to have the Aphria Shares delisted from the TSX.
|
Q:
|
Are the Tilray Shares listed on a stock exchange?
|
A:
|
Tilray Shares are currently listed on the Nasdaq under the symbol “TLRY” and trade in U.S. dollars. In addition, Tilray
currently expects to list the Tilray Shares on the TSX at, or as soon as practicable following, the Effective Time, which will trade in Canadian dollars. Consequently, following the closing, Aphria Shareholders are expected to be able to
trade their Tilray Shares on either exchange, in either currency. See “The Arrangement Agreement and Related Agreements – Covenants”.
|
Q:
|
What are the Canadian federal income tax consequences of the Arrangement?
|
A:
|
Aphria Shareholders who are residents of Canada for purposes of the Tax Act should be aware that the exchange of Aphria Shares
for Tilray Shares under the Arrangement will be a taxable transaction for Canadian federal income tax purposes. Aphria Shareholders who are non-residents of Canada for purposes of the Tax Act and that do not hold their Aphria Shares as
“taxable Canadian property” will generally not be subject to tax under the Tax Act on the exchange of their Aphria Shares for Tilray Shares under the Arrangement.
|
Q:
|
What are the U.S. federal income tax consequences of the Arrangement?
|
A:
|
Aphria Shareholders should not recognize gain or loss as a result of the Arrangement for U.S. tax purposes. Each holder’s
aggregate tax basis in Tilray Shares received should equal the aggregate tax basis of the holder’s Aphria Shares surrendered in the Arrangement, as applicable. Each holder’s holding period for Tilray Shares received in the Arrangement
should include such holder’s holding period for the Aphria Shares surrendered in the Arrangement.
|
Q:
|
What will happen if the Aphria Resolution is not approved or the Tilray Resolutions are not approved or the
Arrangement Agreement is terminated?
|
A:
|
If the Aphria Resolution is not approved, the Arrangement Agreement may be terminated by either Aphria or Tilray, and in the
event it is terminated, Aphria will be required to pay to Tilray its Transaction Expenses (up
|
Q:
|
Are there risks I should consider in deciding whether to vote for the proposed Arrangement?
|
A:
|
Yes. The proposed Arrangement is subject to a number of risks and uncertainties. There can be no certainty that all conditions
precedent to the Arrangement will be satisfied or waived, and, accordingly, the Arrangement may not be completed. For example: (i) the Required Regulatory Approvals may not be obtained and, therefore, the market price of Aphria Shares and
Tilray Shares may be affected; (ii) the Arrangement may be terminated in certain circumstances and the termination amount provided under the Arrangement Agreement may discourage other parties from attempting to acquire Aphria or Tilray;
and (iii) if the Arrangement is consummated, the difficulties that management of the Combined Company may encounter in the process of integrating the business and operations of Aphria and Tilray could have an adverse effect on the
revenues, level of expenses and operating results of the Combined Company.
|
Q:
|
When and where is the Aphria Meeting?
|
A:
|
The Aphria Meeting will be held on April 14, 2021 at 4:00 p.m. (Eastern time). In light of the recent coronavirus (COVID-19)
pandemic and in order to address potential issues arising from the unprecedented public health impact of COVID-19, comply with applicable public health directives that may be in force at the time of the Aphria Meeting and to limit and
mitigate risks to the health and safety of our communities, Aphria Shareholders, employees, directors and other stakeholders, the Aphria Meeting will be held in a virtual format. Aphria Shareholders may participate by logging in online
at www.virtualshareholdermeeting.com/APHA2021, where they will be able to virtually attend the Aphria Meeting via live audio webcast. Online check-in will begin at 3:45 p.m. (Eastern time), and we encourage you to allow ample time for
the online check-in procedures. To participate in the Aphria Meeting, Aphria Shareholders will need their unique 16-digit control number included on the form of proxy or voting instruction form, as applicable.
|
Q:
|
What am I voting on?
|
A:
|
You are being asked to consider and approve the Arrangement involving, among other things, the acquisition by Tilray of all of
the outstanding Aphria Shares pursuant to the Arrangement Agreement.
|
Q:
|
Does the Aphria Board support the Arrangement?
|
A:
|
Yes. The Aphria Board has unanimously determined that the Arrangement is in the best interests of Aphria and recommends that
Aphria Shareholders vote FOR the Aphria Resolution.
|
Q:
|
What approvals are required by Aphria Shareholders at the Aphria Meeting?
|
A:
|
To be effective, the Aphria Resolution must be approved by the affirmative vote of at least two-thirds of the votes cast on the
Aphria Resolution by Aphria Shareholders, virtually present or represented by proxy at the Aphria Meeting. See “General Information about the Aphria Meeting and Voting – Purpose of the Aphria Meeting”.
|
Q:
|
Are Aphria Shareholders entitled to Dissent Rights?
|
A:
|
Yes. Registered holders of Aphria Shares are entitled to Dissent Rights only if they follow the procedures specified in the
OBCA, as modified by the Interim Order and the Plan of Arrangement. Persons who are beneficial owners of Aphria Shares registered in the name of an Intermediary who wish to dissent should be aware that only registered Aphria Shareholders
are entitled to Dissent Rights.
|
Q:
|
How do I vote on the Aphria Resolution?
|
A:
|
You should carefully read and consider the information contained in this Circular. Registered Aphria Shareholders should
then vote by (1) visiting the internet site listed in the enclosed Aphria form of proxy or voting instruction form, (2) calling the toll-free number listed on the enclosed Aphria form of proxy or voting instruction form, or (3)
submitting your enclosed Aphria form of proxy or voting instruction form by mail by using the provided self-addressed, pre-paid envelope. To be counted at the Aphria Meeting, an Aphria Shareholder’s voting instructions must be received
by 4:00 p.m. (Eastern time) on April 12, 2021, or if the Aphria Meeting is postponed or adjourned, at least 48 hours (excluding non-Business Days) prior to the date of the postponed or adjourned Aphria Meeting. Aphria reserves the right
to accept late proxies and to waive the proxy cut-off, with or without notice, but is under no obligation to accept or reject any particular late proxy. See “General Information about the Aphria Meeting and Voting – Registered Aphria
Shareholders”.
|
Q:
|
Should I send in my proxy now?
|
A:
|
Yes. To ensure your vote is counted, you should immediately complete and submit the enclosed form of proxy or voting
instruction form. You are encouraged to vote well in advance of the proxy cut-off at 4:00 p.m. (Eastern time) on April 12, 2021 (or if the Aphria Meeting is postponed or adjourned, at least 48 hours (excluding non-Business Days) prior
to the date of the postponed or adjourned Aphria Meeting). See “General Information about the Aphria Meeting and Voting – Voting Instructions”.
|
Q:
|
Should I send in my Letter of Transmittal and Aphria share certificates now?
|
A:
|
Yes. It is recommended that all registered Aphria Shareholders complete, sign and return the Letter of Transmittal with
accompanying Aphria share certificate(s) or DRS Statement(s) to the Depositary as soon as possible. Please be sure to use the Letter of Transmittal. See “Description of the Arrangement – Exchange Procedure”.
|
Q:
|
If my Aphria Shares are held by an Intermediary, will they vote my Aphria Shares for me?
|
A:
|
An Intermediary will vote the Aphria Shares held by you only if you provide instructions to such Intermediary on how to vote or
which election to make. If you fail to give proper instructions, those Aphria Shares will not
|
Q:
|
What happens if I hold my Aphria Shares in an RESP, TFSA or RRSP account?
|
A:
|
For Canadian resident shareholders that hold Aphria Shares in an RESP, TFSA, RRSP or other registered account, no immediate
Canadian tax will arise as a result of the Arrangement, whether or not any gain is realized on the disposition of Aphria Shares. Further, Tilray Shares will remain qualified investments for an RESP, TFSA and RRSP or other registered
accounts.
|
Q:
|
When will I receive the Tilray Shares in exchange for my Aphria Shares under the Arrangement?
|
A:
|
You will receive the Tilray Shares due to you under the Arrangement as soon as practicable after the Arrangement becomes
effective and your Letter of Transmittal, Aphria share certificate(s) or DRS Statement(s), and all other required documents are properly completed and received by the Depositary. It is anticipated that the Arrangement will be completed
on or about April 20, 2021 assuming the Aphria Resolution is approved, all Court and all other approvals have been obtained, and all other conditions of closing have been satisfied or waived.
|
Q:
|
What happens if I send in my Aphria share certificate(s) or DRS Statement(s) and the Aphria Resolution is not
approved or the Arrangement is not completed?
|
A:
|
If the Aphria Resolution is not approved or if the Arrangement is not otherwise completed, your Aphria share certificate(s) or
DRS Statement(s) will be returned promptly to you by the Depositary.
|
Q:
|
Can I revoke my vote after I have voted by proxy?
|
A:
|
Yes. An Aphria Shareholder executing the enclosed form of proxy has the right to revoke it by voting again on the internet
or by telephone, or by any other means permitted by law. Registered Aphria Shareholders may also revoke their instructions by delivering a signed written notice changing their instructions to Chief Legal Officer of Aphria no later than
April 13, 2021 (or the-Business Days prior to the date of any adjournment, if the Aphria Meeting is adjourned) at 1 Adelaide Street East, Suite 2310, Toronto, ON, M5C 2V9, Attention: Christelle Gedeon, Chief Legal Officer (email: info @aphria.com )
or to the chair of the Aphria Meeting on the day of the Aphria Meeting (or any adjournment, if the Aphria Meeting is adjourned) at chair@aphria.com..
|
Q:
|
Who can help answer my questions?
|
A:
|
If you have any questions about this Circular or the matters described in this Circular, please contact your professional
advisor. Aphria Shareholders who would like additional copies, without charge, of this Circular or have additional questions about the procedures for voting Aphria Shares or making an election, should contact their Intermediary or Laurel
Hill by email, or at one of the numbers below.
|
North American Toll-Free Number:
|
| |
1-877-452-7184
|
Outside of North America Collect Calls Number:
|
| |
416-304-0211
|
By Email:
|
| |
assistance@laurelhill.com
|
Q:
|
When and where is the Tilray Meeting?
|
A:
|
The Tilray Meeting will be held on April 16, 2021 at 11:00 a.m. (Eastern time). In light of the recent coronavirus
(COVID-19) pandemic and in order to address potential issues arising from the unprecedented public health impact of COVID-19, comply with applicable public health directives that may be in force at the time of the Tilray Meeting and to
limit and mitigate risks to the health and safety of our communities, Tilray Stockholders, employees, directors and other stakeholders, the Tilray Meeting will be held in a virtual format. Tilray Stockholders may participate by logging
in online at www.virtualshareholdermeeting.com/TLRY2021SM , where they will be able to virtually attend the Tilray Meeting via live audio webcast. Online check-in will begin at 10:45 a.m. (Eastern time), and we
encourage you to allow ample time for the online check-in procedures. To participate in the Tilray Meeting, Tilray Stockholders will need their unique 16-digit control number included on their Tilray proxy card (printed in the box and
marked by the arrow) or the instructions that accompanied the proxy materials.
|
Q:
|
What am I voting on?
|
1.
|
To consider and vote on a proposal to increase the authorized capital stock of Tilray from 743,333,333 shares to 900,000,000
shares of capital stock, consisting of 890,000,000 shares of Class 2 common stock and 10,000,000 shares of preferred stock, as reflected in the amendment to the second amended and restated certificate of Tilray attached as Appendix “F”
to the Circular (the “ Tilray Charter Amendment ”), which is further described in this
Circular, including in the section entitled “Amendment to Tilray’s Organizational Documents” beginning on page 137 of this Circular and a copy of the Tilray Charter Amendment is attached as Appendix
“F” (the “ Tilray Charter Amendment Proposal ”).
|
2.
|
To consider and vote on a proposal to issue Tilray Class 2 common stock (the “ Tilray
Shares ”) to Aphria Shareholders pursuant to the Arrangement Agreement which is further described in this Circular, including in the section entitled “The Arrangement Agreement and Related Agreements” beginning on page 115 of this Circular, and a copy of the Arrangement Agreement is attached as Appendix “A” (the “ Tilray Share Issuance
Proposal ”);
|
3.
|
To consider and approve, on an advisory (non-binding) basis, the compensation that may be paid to Tilray’s named executive
officers that is based on or otherwise relates to the transactions contemplated by the Arrangement Agreement, which is further described in this Circular, including in the section entitled “Interests of Tilray’s Directors and Management
in the Arrangement” beginning on page 96 of this Circular (the “ Tilray Advisory Compensation Proposal ”);
|
4.
|
To approve the adjournment of the Tilray Meeting to a later date or dates, if necessary or appropriate, to solicit additional
proxies in the event there are not sufficient votes at the time of the Tilray Meeting to approve the Tilray Charter Amendment Proposal or the Tilray Share Issuance Proposal (the “Tilray Adjournment Proposal”).
|
Q:
|
Does the Tilray Board support the Tilray Proposals?
|
A:
|
Yes. The Tilray Board has unanimously determined that the Tilray Proposals are in the best interests of Tilray and recommends
that the Tilray Stockholders vote FOR the Tilray Proposals.
|
Q:
|
What approvals are required by Tilray Stockholders at the Tilray Meeting?
|
A:
|
Except for the Tilray Adjournment Proposal, the vote required to approve all of the proposals listed herein assumes the
presence of a quorum.
|
|
No.
|
| |
Proposal
|
| |
Votes Necessary
|
|
|
1.
|
| |
Tilray Charter Amendment Proposal
|
| |
Approval requires the affirmative vote of the holders of a majority of the Tilray
Shares outstanding and entitled to vote on the Tilray Charter Amendment Proposal.
A failure to vote, a broker non-vote or an abstention will have the same effect
as a vote AGAINST the Tilray Charter Amendment Proposal.
|
|
|
2.
|
| |
Tilray Share Issuance Proposal
|
| |
Approval requires the affirmative vote of a majority of votes cast at the Tilray
Meeting on the Tilray Share Issuance Proposal.
An abstention will have the same effect as a vote AGAINST the Tilray Share Issuance Proposal, while a broker non-vote or other failure to vote will have no effect on the outcome of the Tilray Share Issuance Proposal, so long as a quorum is present.
|
|
|
3.
|
| |
Tilray Advisory Compensation Proposal
|
| |
Approval requires the affirmative vote of the holders of a majority of the
outstanding Tilray Shares, present or represented by proxy at the Tilray Meeting, and entitled to vote on the Tilray Advisory Compensation Proposal.
A failure to vote, a broker non-vote or an abstention will have the same effect
as a vote AGAINST the Tilray Advisory Compensation Proposal.
|
|
|
4.
|
| |
Tilray Adjournment Proposal
|
| |
Approval requires the affirmative vote of the holders of a majority of the voting
power of the shares of Tilray Shares present or represented by proxy at the Tilray Meeting and entitled to vote on such proposal.
An abstention will have the same effect as a vote AGAINST the Tilray Adjournment Proposal, while a broker non-vote or other failure to vote will have no effect on the outcome of the Tilray Adjournment Proposal.
|
|
Q:
|
How do I vote on the Tilray Proposals?
|
A:
|
You should carefully read and consider the information contained in this Circular. Registered Tilray Stockholders should then
vote by (1) visiting the internet site listed on the enclosed Tilray proxy card, (2) calling
|
Q:
|
Should I send in my proxy now?
|
A:
|
Yes. To ensure your vote is counted, you should immediately complete and submit the enclosed form of proxy or voting
instruction form. You are encouraged to vote well in advance of the proxy cut-off at 11:59 p.m. (Eastern time) on April 15, 2021 (or if the Tilray Meeting is postponed or adjourned, prior to the date of the postponed or adjourned Tilray
Meeting).
|
Q:
|
If my Tilray Shares are held by a broker, will they vote my Tilray Shares for me?
|
A:
|
A broker will vote the Tilray Shares held by you only if you provide instructions to such broker on how to vote or which
election to make. If you fail to give proper instructions, those Tilray Shares will not be voted on your behalf. Tilray Stockholders should instruct their brokers to vote their Tilray Shares on their behalf by following the directions on
the voting instruction form provided to them by their Intermediaries. Unless your Intermediary gives you its proxy to vote the Tilray Shares at the Tilray Meeting, you cannot vote those Tilray Shares owned by you at the Tilray Meeting.
See “General Information about the Tilray Meeting and Voting – Beneficial Tilray Stockholders”.
|
Q:
|
Can I revoke my vote after I have voted by proxy?
|
A:
|
Yes. A Tilray Stockholder executing the enclosed form of proxy has the right to revoke it by either attending the Tilray
Meeting and voting at the Tilray Meeting or providing a new proxy dated as at a later date, provided that the new proxy is received by Broadridge before 11:59 p.m. (Eastern time) on April 15, 2021 (or if the Tilray Meeting is postponed
or adjourned, prior the date of the postponed or adjourned Tilray Meeting). A registered Tilray Stockholder may also revoke any prior proxy without providing new voting instructions by clearly indicating in writing that such Tilray
Stockholder wants to revoke his, her or its proxy and delivering this written document to (i) the registered office of Tilray at Tilray, Inc., c/o Corporate Secretary, 1100 Maughan Road, Nanaimo, BC, Canada, V9X IJ2, at any time up to
and including the last Business Day preceding the day of the Tilray Meeting, or any adjournment of the Tilray Meeting, or (ii) the Chair of the Tilray Meeting at the Tilray Meeting or any postponement or adjournment thereof and prior to
the vote in respect of the Tilray Charter Amendment Proposal or the Tilray Share Issuance Proposal or in any other way permitted by law.
|
Q:
|
Who can help answer my questions?
|
A:
|
If you have any questions about this Circular or the matters described in this Circular, please contact your professional
advisor. Tilray Stockholders who would like additional copies, without charge, of this Circular or have additional questions about the procedures for voting Tilray Shares or making an election, should contact their broker or MacKenzie
Partners by email, or at the numbers below.
|
Toll-Free Number:
|
| |
1-800-322-2885
|
Call Collect:
|
| |
1-212-929-5500
|
By Email:
|
| |
proxy@mackenziepartners.com
|
Year Ended December 31
|
|||||||||
|
| |
2020
|
| |
2019
|
| |
2018
|
|
| |
(C$)
|
| |
(C$)
|
| |
(C$)
|
Highest rate during the period
|
| |
1.45
|
| |
1.36
|
| |
1.36
|
Lowest rate during the period
|
| |
1.27
|
| |
1.30
|
| |
1.23
|
Average rate for the period
|
| |
1.34
|
| |
1.33
|
| |
1.30
|
Rate at the end of the period
|
| |
1.27
|
| |
1.30
|
| |
1.36
|
•
|
expectations regarding whether the Arrangement will be consummated, including whether conditions to the consummation of the
Arrangement will be satisfied, or the anticipated timing or closing of the Arrangement;
|
•
|
expectations regarding receipt of all Required Regulatory Approvals and the expiration of relevant waiting periods, shareholder
approvals, court approvals and satisfaction of other customary closing conditions;
|
•
|
estimates of pro-forma financial information of the Combined Company, including in respect of expected revenues, margins, cash
flow, profitability, and production of cannabis;
|
•
|
estimates of future costs applicable to sales, future capital expenditures, future cost reductions, and projected synergies
including pre-tax synergies, cost savings and efficiencies;
|
•
|
the Combined Company anticipating to have scalable medical and adult-use cannabis platforms expected to strengthen the
leadership position in Canada, internationally, and eventually in the United States;
|
•
|
the Combined Company being well positioned in the European cannabis markets Combined Company’s ability to leverage Tilray’s
current European platforms;
|
•
|
the legalization of cannabis in the United States and the Combined Company being well positioned to compete in the United
States market;
|
•
|
the Combined Company expecting to offer a diversified and branded product offering and distribution footprint, world-class
cultivation, processing and manufacturing facilities;
|
•
|
the financial projections by Aphria, and the Aphria estimated synergies, including operational efficiencies expected to be
generated as a result of the Arrangement in the amount of more than US$78 million (C$100 million) of pre-tax annual cost synergies;
|
•
|
anticipated tax treatment of the Arrangement for Aphria Shareholders;
|
•
|
expectations of future balance sheet strength and future equity, including expectations for the effects of the Arrangement on
the Combined Company’s financial position, cash flow and growth prospects;
|
•
|
expectations that the Combined Company is expected to unlock significant shareholder value and realize the benefit of the
Synergies;
|
•
|
any other strategic and financial benefits in connection with the Arrangement, including any anticipated future results and
pro-forma financial information relating to the Combined Company;
|
•
|
the anticipated value of the Consideration to be received by the Aphria Shareholders, which may fluctuate in value due to
trading prices of the Tilray Shares forming part of the Consideration;
|
•
|
expectations regarding the size and composition of the board of directors of the Combined Company;
|
•
|
expectations regarding the listing of Tilray Shares on the TSX following the Effective Time;
|
•
|
the number of Tilray Shares issuable to Aphria Shareholders and the expected ownership percentages of Tilray and Aphria
Stockholders after the closing of the Arrangement; and
|
•
|
expectations that the Arrangement will allow the Combined Company to benefit from significant geographic diversification and
economies of scale.
|
•
|
the inherent uncertainty associated with financial or other projections or outlooks;
|
•
|
risks assumptions and expectations described in Aphria’s and Tilray’s critical accounting policies and estimates;
|
•
|
the adoption and impact of certain accounting pronouncements;
|
•
|
Aphria’s and Tilray’s future financial and operating performance;
|
•
|
the commercial and business plans of Aphria and Tilray;
|
•
|
the intention to grow the business, operations and potential activities of Aphria and Tilray;
|
•
|
the ability of Aphria and Tilray to complete the Arrangement;
|
•
|
Aphria’s and Tilray’s ability to maintain a strong financial position and manage costs;
|
•
|
the ability of Aphria and Tilray to maximize the utilization of their existing assets and investments;
|
•
|
that the completion of the Arrangement is subject to the satisfaction or waiver of a number of conditions as set forth in the
Arrangement Agreement;
|
•
|
some or all the expected benefits of the Arrangement may fail to materialize or may not occur within the time periods
anticipated by Aphria and Tilray;
|
•
|
the prompt and effective integration of the Combined Company;
|
•
|
the ability to achieve the anticipated synergies and value-creation contemplated by the Transaction;
|
•
|
the risk associated with Aphria’s and Tilray’s ability to obtain the approval of the Transaction by their shareholders required
to consummate the Transaction and the timing of the closing of the Transaction, including the risk that the conditions to the Transaction are not satisfied on a timely basis or at all;
|
•
|
the risk that a consent or authorization that may be required for the Transaction is not obtained or is obtained subject to
conditions that are not anticipated;
|
•
|
the outcome of any legal proceedings that may be instituted against the parties and others related to the Arrangement
Agreement;
|
•
|
unanticipated difficulties or expenditures relating to the Transaction, the response of business partners and retention as a
result of the announcement and pendency of the Transaction;
|
•
|
risks relating to the value of Tilray Shares to be issued in connection with the Transaction;
|
•
|
the impact of competitive responses to the announcement of the Transaction;
|
•
|
the diversion of management time on Transaction-related issues;
|
•
|
there can be no assurance that the Arrangement will occur or that the anticipated strategic benefits and operational,
competitive and cost synergies will be realized;
|
•
|
the exchange ratio is fixed and there can be no assurance that the market value of the Tilray Shares that the holders of Aphria
Shares may receive on the Effective Date will equal or exceed the market value of the Aphria Shares held by such Aphria Shareholders prior to the Effective Date;
|
•
|
changes in tax laws, regulations or future assessments;
|
•
|
failure to realize anticipated results, including revenue growth, anticipated cost savings or operating efficiencies from the
Combined Company’s major initiatives, including those from restructuring;
|
•
|
assumptions and estimates required for the preparation of the pro forma financial statements may be materially different from
the Combined Company’s actual results and experience in the future; and
|
•
|
risks or delays arising from or relating to the ongoing COVID-19 pandemic.
|
•
|
World’s Largest Global Cannabis Company. On a pro forma basis for the last twelve
months reported by each company prior to the date of the announcement of the Arrangement on December 16, 2020, the Combined Company would have had revenue of approximately US$685 million (C$874 million), which would have been the
highest among publicly reporting cannabis companies globally over that period.
|
•
|
Strategic Footprint and Operational Scale. The Combined Company is expected to have
the strategic footprint and operational scale necessary to compete more effectively in today’s consolidating cannabis market with a strong, flexible balance sheet, strong cash balance and access to capital which Aphria and Tilray
believe will give it the ability to accelerate growth and deliver long-term sustainable value for stockholders.
|
•
|
Low-Cost State-of-the-Art Production & The Leading Canadian Adult-Use Cannabis Producer.
The Combined Company is expected to have one of the lowest cost production operations with its state-of-the-art facilities. In addition, the Combined Company will have a portfolio of carefully curated brands across all consumer segments
and a complete portfolio of Cannabis 2.0 products. In the adult-use market in Canada, the Combined Company, on a pro forma basis for the last twelve months reported by each company prior to the date of the announcement of the execution
of the Arrangement Agreement on December 16, 2020, would have had gross revenue of US$232 million (C$296 million), which would have been the most of any Canadian licensed producer.
|
•
|
Positioned to Pursue International Growth. The Combined Company will be
well-positioned to pursue growth opportunities with its end-to-end EU-GMP supply chain and distribution. Aphria is one of three companies selected in Germany to receive a license for the in-country cultivation of medical cannabis and
has distribution capabilities that will support the Aphria and Tilray medical cannabis brands. Tilray’s EU-GMP cultivation and production facility in Portugal will provide the Combined Company with the capacity to cultivate and produce
EU-GMP medical cannabis products in order to meet international demand and the Combined Company will be able to export products produced in such facility on a tariff-free basis to EU countries.
|
•
|
Enhanced Consumer Packaged Goods Presence and Infrastructure in the U.S. The Combined
Company is expected to have an improved position from a corporate, branding and products perspective if cannabis is legalized under U.S. federal law and allow the Combined Company to leverage several established third-party
partnerships. In the United States, the Combined Company will have a strong consumer packaged goods presence and infrastructure with two strategic pillars: SweetWater, a leading cannabis lifestyle branded craft brewer, and Manitoba
Harvest, a pioneer in branded hemp, CBD and wellness products with access to 17,000 stores in North America.
|
•
|
Substantial Synergies. The combination of Aphria and Tilray is expected to deliver
meaningful synergies arising from cost leadership and scale opportunities in the Canadian adult-use and medical cannabis sector. Within 24 months of the completion of the Transaction, the Combined Company expects to achieve
approximately US$78 million (C$100 million) annual pre-tax cost synergies. The Combined Company expects to achieve cost synergies in the key areas of cultivation and production, cannabis and product purchasing, sales and marketing and
corporate expenses.
|
•
|
Proven Leadership Team. The Combined Company will be led by a best-in-class
management team and board of directors, with strong track records in consumer-packaged goods and cannabis experience internationally.
|
(4)
|
The relative ownership percentages as at the date of the announcement of the Transaction were
62% and 38%, respectively, but since the Exchange Ratio remains fixed, the relative ownership percentages have changed as a result of a share issuance by Tilray pursuant to an at-the-market offering on February 25, 2021.
|
•
|
the Arrangement must be approved by the Aphria Shareholders in the manner set forth in the Interim Order;
|
•
|
the Court must grant the Final Order approving the Arrangement; and
|
|
No.
|
| |
Proposal
|
| |
Votes Necessary
|
|
|
1.
|
| |
Tilray Charter Amendment Proposal
|
| |
Approval requires the affirmative vote of the holders of a majority of the
Tilray Shares outstanding and entitled to vote on the Tilray Charter Amendment Proposal.
A failure to vote, a broker non-vote or an abstention will have the same effect
as a vote AGAINST the Tilray Charter Amendment Proposal.
|
|
|
2.
|
| |
Tilray Share Issuance Proposal
|
| |
Approval requires the affirmative vote of a majority of votes cast at the
Tilray Meeting on the Tilray Share Issuance Proposal.
An abstention will have the same effect as a vote AGAINST the Tilray Share Issuance Proposal, while a broker non-vote or other failure to vote will have no effect on the outcome of the Tilray Share Issuance Proposal, so long as a quorum is present.
|
|
|
3.
|
| |
Tilray Advisory Compensation Proposal
|
| |
Approval requires the affirmative vote of the holders of a majority of the
outstanding Tilray Shares, present or represented by proxy at the Tilray Meeting, and entitled to vote on the Tilray Advisory Compensation Proposal.
A failure to vote, a broker non-vote or an abstention will have the same effect
as a vote AGAINST the Tilray Advisory Compensation Proposal.
|
|
|
4.
|
| |
Tilray Adjournment Proposal
|
| |
Approval requires the affirmative vote of the holders of a majority of the
voting power of the shares of Tilray Shares present or represented by proxy at the Tilray Meeting and entitled to vote on such proposal.
An abstention will have the same effect as a vote AGAINST the Tilray Adjournment Proposal, while a broker non-vote or other failure to vote will have no effect on the outcome of the Tilray Adjournment Proposal.
|
|
|
| |
Six Months
Ended
November 30
|
| |
Years ended May 31
|
||||||
(CAD$ in thousands, except per share amounts)
|
| |
2020
|
| |
2020
|
| |
2019
|
| |
2018
|
Consolidated Results of Operations Data:
|
| |
|
| |
|
| |
|
| |
|
Net Revenue
|
| |
$306,221
|
| |
$543,339
|
| |
$237,110
|
| |
$36,917
|
Gross profit before fair value adjustments
|
| |
$87,085
|
| |
$133,759
|
| |
$62,538
|
| |
$27,912
|
Gross profit
|
| |
$114,771
|
| |
$191,975
|
| |
$75,421
|
| |
$40,887
|
Operating Loss
|
| |
$(22,468)
|
| |
$(66,057)
|
| |
$(145,155)
|
| |
$(12,428)
|
Net income / (loss)
|
| |
$(125,693)
|
| |
$(84,634)
|
| |
$(16,499)
|
| |
$29,448
|
Net loss per share - basic and diluted
|
| |
$(0.43)
|
| |
$(0.33)
|
| |
$(0.07)
|
| |
$0.18
|
|
| |
Six Months
Ended
November 30
|
| |
May 31
|
||||||
(CAD$ in thousands)
|
| |
2020
|
| |
2020
|
| |
2019
|
| |
2018
|
Consolidated Balance Sheet Data:
|
| |
|
| |
|
| |
|
| |
|
Cash and cash equivalents
|
| |
$187,997
|
| |
$497,222
|
| |
$550,797
|
| |
$59,737
|
Total assets
|
| |
$2,810,801
|
| |
$2,498,439
|
| |
$2,441,592
|
| |
$1,314,092
|
Total liabilities
|
| |
$863,810
|
| |
$660,097
|
| |
$708,439
|
| |
$140,499
|
Total shareholders’ equity
|
| |
$1,946,991
|
| |
$1,838,342
|
| |
$1,733,153
|
| |
$1,173,593
|
|
| |
Years ended December 31
|
||||||
(USD$ in thousands, except per share amounts)
|
| |
2020
|
| |
2019
|
| |
2018
|
Consolidated Results of Operations Data:
|
| |
|
| |
|
| |
|
Revenue
|
| |
$210,482
|
| |
$166,979
|
| |
$43,130
|
Gross profit (loss)
|
| |
$24,655
|
| |
$(23,496)
|
| |
$14,275
|
Operating Loss
|
| |
$(201,124)
|
| |
$(304,138)
|
| |
$(57,840)
|
Net loss
|
| |
$(271,073)
|
| |
$(321,169)
|
| |
$(67,723)
|
Net loss per share - basic and diluted
|
| |
$(2.15)
|
| |
$(3.20)
|
| |
$(0.82)
|
|
| |
Years ended December 31
|
||||||
(USD$ in thousands)
|
| |
2020
|
| |
2019
|
| |
2018
|
Consolidated Balance Sheet Data:
|
| |
|
| |
|
| |
|
Cash and cash equivalents
|
| |
$189,702
|
| |
$96,791
|
| |
$487,255
|
Working capital
|
| |
$165,738
|
| |
$166,600
|
| |
$528,365
|
Total assets
|
| |
$945,949
|
| |
$896,330
|
| |
$656,667
|
Total liabilities
|
| |
$572,050
|
| |
$611,059
|
| |
$459,014
|
Accumulated deficit
|
| |
$(730,103)
|
| |
$(430,130)
|
| |
$(108,177)
|
Total stockholders’ equity
|
| |
$373,899
|
| |
$285,271
|
| |
$197,653
|
Pro Forma Financial Information
|
| |
|
(USD$ in thousands, except per share amounts)
|
| |
Pro forma combined
December 31, 2020
|
Summary Pro Forma Statement of Net Loss
|
| |
|
Revenue
|
| |
$682,445
|
Gross Profit
|
| |
$116,604
|
Net loss
|
| |
$(524,584)
|
Net loss per share - basic and diluted
|
| |
$(1.32)
|
|
| |
|
Summary Pro Forma Balance Sheet
|
| |
|
Cash and cash equivalents
|
| |
$371,841
|
Total assets
|
| |
$6,391,900
|
Convertible notes, net of issuance costs
|
| |
$510,370
|
Long-term debt
|
| |
$144,819
|
Total stockholders’ equity
|
| |
$4,722,201
|
1.
|
to consider and, if thought advisable, to pass the Aphria Resolution, the full text of which is set forth in Appendix “C” to
this Circular, approving the Arrangement pursuant to Section 182 of the OBCA involving, among other things, the acquisition by Tilray of all of the outstanding Aphria Shares, all as more particularly described in this Circular, which
resolution, to be effective, must be passed by an affirmative vote of at least two-thirds of the votes cast at the Aphria Meeting by Aphria Shareholders either online, by proxy or by voting instruction form, as applicable; and
|
2.
|
to transact such further and other business as may properly be brought before the Aphria Meeting or any postponement or
adjournment thereof.
|
Internet:
|
| |
Go to www.proxyvote.com and enter the 16-digit control number printed on
the form of proxy or scan the QR Code on the Aphria form of proxy to access and follow the instructions on the screen. Internet voting facilities for Aphria Shareholders of record are available 24 hours a day.
|
Phone:
|
| |
Call the toll-free telephone number provided on the form of proxy and follow the
promoted instructions. You will need to enter the 16-digit control number. Telephone voting facilities for Aphria Shareholders of record are available 24 hours a day.
|
Mail:
|
| |
Enter your voting instructions, sign and date the form of proxy and return your
completed form of proxy or voting instruction form in the enclosed postage paid envelope provided to Data Processing Centre, P.O. Box 3700 STN Industrial Park, Markham, ON L3R 9Z9.
|
Virtually at the Meeting:
|
| |
Registered Aphria Shareholders and duly appointed proxyholders can vote at the
appropriate times by completing a ballot online during the Aphria Meeting. It is anticipated that once voting has opened during the Aphria Meeting, the resolutions and voting choices will be displayed and you will be able to vote by
selecting your voting choices from the options shown on the screen. You must click submit for your vote to be counted.
|
Shareholders:
|
| |
enter the 16-digit control number located on your form of proxy or voting
instruction form. Registered Aphria Shareholders and beneficial Aphria Shareholders will be entitled to attend the Aphria Meeting and ask questions, however, only Registered Aphria Shareholders and duly appointed proxyholders will be able
to vote at the Aphria Meeting; or
|
Proxyholders / Appointees:
|
| |
follow the instructions including entering the “Appointee Name” and “Appointee
Identification Number” as it was provided by the Aphria Shareholder and click submit; or
|
Guests:
|
| |
complete the online form. Guests may attend the Aphria meeting but will not be
able to ask questions.
|
(a)
|
to vote their Aphria Subject Shares, and, in the case of Aphria Subject Shares held by an affiliate or associate (as defined in
the Aphria Support Agreement) of the Aphria Supporting Shareholder, to cause any holder of record of Aphria Subject Shares to vote or to execute a written consent or consents with respect to the Aphria Subject Shares at the Aphria Meeting
(or any adjournment or postponement thereof or at every other meeting of the shareholders of Aphria with respect to the Aphria Resolution) (i) in favour of the Aphria Resolution and any other matter necessary for the consummation of the
Arrangement and the other transactions contemplated by the Arrangement Agreement; (ii) against any adverse proposal and (iii) against any action, proposal, transaction, agreement, or other matter that would reasonably be expected to
impede, interfere with, delay, discourage, postpone or adversely affect the Plan of Arrangement or any of the transactions contemplated by the Plan of Arrangement;
|
(b)
|
if the Aphria Supporting Shareholder is the holder of record of any of the Aphria Subject Shares, no later than five Business
Days prior to the date of the Aphria Meeting, the Aphria Supporting Shareholder shall deliver or cause to be delivered to Tilray, a copy of the duly executed proxy or proxies in respect of the Aphria Subject Shares directing the holder of
such proxy or proxies to vote in favour of the Aphria Resolution and/or any matter that could be expected to facilitate the Arrangement;
|
(c)
|
if the Aphria Supporting Shareholder is the beneficial owner of any of the Aphria Subject Shares, no later than five Business
Days prior to the date of the Aphria Meeting, the Aphria Supporting Shareholder shall
|
(d)
|
to appoint Tilray and any designee of Tilray, and each of them individually, as its proxies and attorneys-in-fact, with full
power of substitution and re-substitution, to vote or act by written consent during the term of the Aphria Support Agreement with respect to the Aphria Subject Shares in accordance with the Aphria Support Agreement in the event that
either (i) the Aphria Supporting Shareholder breaches any of its obligations under the Aphria Support Agreement, or (ii) the Aphria Supporting Shareholder fails to vote or act by written consent with respect to the Aphria Subject Shares
in accordance with the foregoing section prior to or at the Aphria Meeting at which the matters described in the foregoing section are considered or the last date by which written consents with respect to such matters are required to be
delivered in order to be effective; and
|
(e)
|
not to tender for any bid or tender offer for Aphria Shares or take any action (including the voting (or granting of a proxy to
vote) of the Aphria Subject Shares) that may lead to or otherwise result in an adverse proposal.
|
1.
|
To consider and vote on a proposal to increase the authorized capital stock of Tilray from 743,333,333 shares to 900,000,000
shares of capital stock, consisting of 890,000,000 shares of Class 2 common stock and 10,000,000 shares of preferred stock, as reflected in the Tilray Charter Amendment attached as Appendix “F”, which is further described in this
Circular, including in the section entitled “Amendment to Tilray’s Organizational Documents” beginning on page 137 of this Circular, and a copy of the Tilray Charter Amendment is attached as Appendix
“F” (the “ Tilray Charter Amendment Proposal ”);
|
2.
|
To consider and vote on a proposal to issue Tilray Class 2 common stock (the “ Tilray
Shares ”) to Aphria Shareholders pursuant to the Arrangement Agreement, as amended on February 19, 2021, which is further described in this Circular, including in the section entitled “The Arrangement Agreement and
Related Agreements” beginning on page 115 of this Circular, and a copy of the Arrangement Agreement is attached as Appendix “A” (the “ Tilray Share Issuance
Proposal ”);
|
3.
|
To consider and approve, on an advisory (non-binding) basis, the compensation that may be paid to Tilray’s named executive
officers that is based on or otherwise relates to the transactions contemplated by the Arrangement Agreement, which is further described in this Circular, including in the section entitled “Interests of Tilray’s Directors and Management
in the Arrangement” beginning on page 96 of this Circular (the “ Tilray Advisory Compensation Proposal ”);
|
4.
|
To approve the adjournment of the Tilray Meeting to a later date or dates, if necessary or appropriate, to solicit additional
proxies in the event there are not sufficient votes at the time of the Tilray Meeting to approve the Tilray Charter Amendment Proposal or the Tilray Share Issuance Proposal (the “Tilray Adjournment Proposal”).
|
|
No.
|
| |
Proposal
|
| |
Votes Necessary
|
|
|
1.
|
| |
Tilray Charter Amendment Proposal
|
| |
Approval requires the affirmative vote of the holders of a majority of the Tilray
Shares outstanding and entitled to vote on the Tilray Charter Amendment Proposal.
|
|
|
A failure to vote, a broker non-vote or an abstention will have the same effect
as a vote AGAINST the Tilray Charter Amendment Proposal.
|
| ||||||
|
2.
|
| |
Tilray Share Issuance Proposal
|
| |
Approval requires the affirmative vote of a majority of votes cast at the Tilray
Meeting on the Tilray Share Issuance Proposal.
|
|
|
An abstention will have the same effect as a vote AGAINST the Tilray Share Issuance Proposal, while a broker non-vote or other failure to vote will have no effect on the outcome of the Tilray Share Issuance Proposal, so long as a quorum is present.
|
| ||||||
|
3.
|
| |
Tilray Advisory Compensation Proposal
|
| |
Approval requires the affirmative vote of the holders of a majority of the
outstanding Tilray Shares, present or represented by proxy at the Tilray Meeting, and entitled to vote on the Tilray Advisory Compensation Proposal.
|
|
|
A failure to vote, a broker non-vote or an abstention will have the same effect
as a vote AGAINST the Tilray Advisory Compensation Proposal.
|
| ||||||
|
4.
|
| |
Tilray Adjournment Proposal
|
| |
Approval requires the affirmative vote of the holders of a majority of the voting
power of the shares of Tilray Shares present or represented by proxy at the Tilray Meeting and entitled to vote on such proposal.
|
|
|
An abstention will have the same effect as a vote AGAINST the Tilray Adjournment Proposal, while a broker non-vote or other failure to vote will have no effect on the outcome of the Tilray Adjournment Proposal.
|
|
Internet:
|
| |
Go to www.proxyvote.com and enter the 16-digit control number printed on
the enclosed Tilray proxy card to access and follow the instructions on the screen. Internet voting facilities for Tilray stockholders of record are available 24 hours a day.
|
Phone:
|
| |
Call the toll-free telephone number provided on the enclosed Tilray proxy card
and following the prompted instructions. You will need to enter the 16-digit control number. Telephone voting facilities for Tilray stockholders of record are available 24 hours a day.
|
Mail:
|
| |
Complete, sign and date the enclosed Tilray proxy card and return your completed
Tilray proxy card in the enclosed postage paid envelope provided to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood NY 11717.
|
Virtually at the Meeting:
|
| |
Registered Tilray Stockholders can vote at the appropriate times by completing a
ballot online during the Tilray Meeting . It is anticipated that once voting has opened during the Tilray Meeting, the proposals and voting choices will be displayed and you will be able to vote by selecting your voting choices from the
options shown on the screen. You must click submit for your vote to be counted.
|
•
|
World’s Largest Global Cannabis Company. On a pro forma basis for the last twelve
months reported by each company prior to the date of the announcement of the Arrangement on December 16, 2020, the Combined Company would have had revenue of approximately US$685 million (C$874 million),
which would have been the highest among publicly reporting cannabis companies globally over that period. The Combined Company will be positioned in the capital markets as a leading global cannabis company, with the scale to attract
institutional investors and strategic partnerships.
|
•
|
Strategic Footprint and Operational Scale. The Combined Company is expected to have the
strategic footprint and operational scale necessary to compete more effectively in today’s consolidating cannabis market with a strong, flexible balance sheet, cash balance and access to capital, which Aphria and Tilray believe will give
it the ability to accelerate growth and deliver long-term sustainable value for stockholders.
|
•
|
Low-Cost State-of-the-Art Production & The Leading Canadian Adult-Use Cannabis
Producer. The Combined Company is expected to have one of the lowest cost production operations with its state-of-the-art facilities. In addition, the Combined Company will have a portfolio of carefully curated Cannabis
2.0 products brands across all consumer segments, including flower, pre-roll, capsules, vapes, edibles and beverages, that are sold through its distribution partners. On a pro forma basis, for the period of August through October 2020,
the Combined Company would have held a 17.3% retail market share, the largest share held by any single licensed producer in Canada and 7% higher than the next closest competitor. (5) In the adult-use market in
Canada, the Combined Company, on a pro forma basis for the last twelve months reported by each company prior to the date of the announcement of the execution of the Arrangement Agreement, would have had gross revenue of US$232 million
(C$296 million) in the adult-use market in Canada, which would have been the most of any Canadian licensed producer.
|
•
|
Positioned to Pursue International Growth. The Combined Company will be well-positioned
to pursue growth opportunities with its end-to-end EU-GMP supply chain and distribution, which will include (i) Aphria One’s Part II EU-GMP approved facility; (ii) ARA-Avanti Rx Part I EU-GMP approved facility; (iii) Aphria’s German
cultivation facility; and (iv) Aphria’s German medical cannabis distribution footprint and (v) Tilray’s 2.7 million square foot EU-GMP cannabis cultivation and production facility in Portugal. Aphria is one of three companies selected in
Germany to receive a licence for the in- country cultivation of medical cannabis and was awarded a total of five lots, which was the most available lots within the tender process, and is the only winner of the German tender with the
permission to grow all three strains of medical cannabis approved by the BfArM. Aphria’s wholly-owned subsidiary, CC Pharma GmbH, will provide the Combined Company with distribution capabilities that will support the Aphria and Tilray
medical cannabis brands to more than 13,000 pharmacies located throughout Germany. The Combined Company will have the opportunity to reach additional pharmacies and patients via distribution
|
(5)
|
Based on Stifel analyst report by Andrew Carter, dated December 6, 2020, “December 2020 Headset
Canada Review”.
|
•
|
Enhanced Consumer Packaged Goods Presence and Infrastructure in the U.S. The Combined
Company is expected to have an improved position from a corporate, branding and products perspective if cannabis is legalized under U.S. federal law and allow the Combined Company to leverage several established third-party partnerships.
In the United States, the Combined Company will have a strong consumer packaged goods presence and infrastructure with two strategic pillars: SweetWater, a leading cannabis lifestyle branded craft brewer, and Manitoba Harvest, a pioneer
in branded hemp, CBD and wellness products with access to 17,000 stores in North America. The Combined Company is expected to leverage SweetWater’s craft beer manufacturing and distribution network to build brand awareness for the
Combined Company’s leading cannabis brands via craft beers, hard seltzers, and other beverages as it seeks to take advantage of opportunities for both health and wellbeing beverage trends. The Combined Company also expects to pursue the
opportunity to expand with new or existing CBD or other cannabinoid brands leveraging Manitoba Harvest’s strong hemp and wellness product platform. If cannabis is legalized under U.S. federal law, the Combined Company expects to be
well-positioned to compete in the U.S. cannabis market given its existing strong cannabis brands and distribution system in addition to its track record of growth in consumer-packaged goods and cannabis.
|
•
|
Substantial Synergies. The combination of Aphria and Tilray is expected to deliver
meaningful synergies arising from cost leadership and scale opportunities in the Canadian adult-use and medical cannabis sector. Within 24 months of the completion of the Transaction, the Combined Company expects to achieve approximately
US$78 million (C$100 million) in annual pre-tax cost synergies. The Combined Company expects to achieve cost synergies in the key areas of cultivation and production, cannabis and product purchasing, sales and marketing and corporate
expenses. This is expected to include capitalizing on Aphria’s expertise and cost management structure and focusing on the opportunity for Aphria’s Leamington, Ontario operations to fully supply and deliver additional volume for Tilray’s
brands and to replace the need for Tilray to purchase wholesale cannabis from other licensed producers. Tilray’s London, Ontario facility is also expected to provide Aphria with excess capacity to increase production of additional product
formats, including advancing Aphria’s launch of branded cannabis edibles and cannabis beverages in Canada. The Combined Company is considering utilizing Tilray’s existing Nanaimo, British Columbia facility to enhance the availability of
Aphria’s premium Broken Coast brand to meet increasing consumer demand. The Combined Company’s scalable infrastructure, both in Canada and internationally, is expected to deliver cost leadership and scale opportunities in the Canadian
adult-use and medical cannabis sector including significant improvements to net profits, net revenues and EBITDA.
|
•
|
Proven Leadership Team. The Combined Company will be led by a best-in-class management
team and board of directors, with strong track records in consumer-packaged goods and cannabis experience internationally. Upon completion of the Arrangement, Aphria’s current Chairman and Chief Executive Officer, Irwin D. Simon, will
lead the Combined Company as Chairman and Chief Executive Officer. The board of directors of the Combined Company will consist of nine members, seven of which, including Mr. Simon, are current Aphria directors and two of which will be
from Tilray, including Brendan Kennedy, and one of which is to be designated. Aphria and Tilray are confident that the leadership team and proposed board of directors of the Combined Company provides a strong foundation for the Combined
Company to accelerate growth.
|
•
|
the strategic reasons for the Arrangement described above under “Description of the Arrangement – Our Reasons for the
Arrangement”;
|
•
|
information concerning the respective businesses of Aphria and Tilray, including information regarding financial performance
and condition, operations, technology and management, and the results of Aphria’s due diligence review of Tilray’s businesses and operations;
|
•
|
the current and prospective competitive environment in which cannabis companies, including Aphria, operate and the likely
effect of that competitive environment on Aphria in light of, and in the absence of, the Arrangement;
|
•
|
the analyses of, and discussions between, the Aphria Board and Aphria’s financial advisor and the financial advisor’s fairness
opinion to the effect that, as of the date of the fairness opinion, based upon and subject to the assumptions made, matters considered and limits of the review undertaken, the 0.8381 Exchange Ratio is fair, from a financial point of view,
to the Aphria Shareholders (for more information see “Description of the Arrangement – Opinion of Aphria’s Financial Advisor”);
|
•
|
the Exchange Ratio of 0.8381 of a Tilray Share for each Aphria Share, and the determination of the Aphria Board that the fixed
exchange ratio was appropriate in a strategic transaction of this type;
|
•
|
the structure and terms of the Arrangement, including:
|
•
|
that on completion of the Arrangement, it is expected (based on the shares of Tilray and Aphria issued and issuable as of
March 12, 2021) that the Exchange Ratio will result in Aphria Shareholders owning approximately 61.2% of the outstanding Tilray Shares on a fully diluted basis providing those Aphria Shareholders with the opportunity to participate in
the future growth of the Combined Company; (6)
|
•
|
that the Aphria Supporting Shareholders, who own, directly or indirectly, or exercise control or direction over, in the
aggregate, Aphria Shares representing less than 1% of the outstanding Aphria Shares as of the date of this Circular, entered into the Aphria Support Agreements pursuant to which the Aphria Supporting Shareholders agreed, among other
things, to vote the subject securities in favour of the Aphria Resolution (for more information see “General Information about the Aphria Meeting and Voting – Aphria Support Agreement);
|
•
|
that the Tilray Supporting Stockholders, who own, directly or indirectly, or exercise control or direction over, in the
aggregate, Tilray Shares representing approximately 6.6% of the outstanding Tilray Shares as of the date of this Circular, entered into the Tilray Support Agreements pursuant to which the Tilray Supporting Stockholders agreed, among
other things, to vote the subject securities in favour of the Tilray Resolutions (for more information see “General Information about the Tilray Meeting and Voting – Tilray Support Agreement”);
|
•
|
the reciprocal nature of the terms of the Arrangement Agreement and the other transaction documents, including the parties’
representations, warranties and covenants, and the Aphria Board’s determination that those terms and conditions were appropriate in a strategic transaction of this type;
|
•
|
the conditions to the completion of the Arrangement, and the Aphria Board’s view that while the completion of the Arrangement
is subject to various conditions, including certain approvals, such conditions and approvals were likely to be satisfied on a timely basis;
|
•
|
the provisions of the Arrangement Agreement designed to restrict the ability of the Parties to solicit third party Acquisition
Proposals but affording both sides the ability to consider and pursue an unsolicited Superior Proposal, the provisions of the Arrangement Agreement providing for the payment of the Aphria Termination Amount or the Tilray Termination
Amount, as applicable, under specified circumstances
|
(2)
|
The relative ownership percentages as at the date of the announcement of the Transaction were
62% and 38%, respectively, but since the Exchange Ratio remains fixed, the relative ownership percentages have changed as a result of a share issuance by Tilray pursuant to an at-the-market offering on February 25, 2021.
|
•
|
that the Arrangement must be approved by the affirmative vote of at least two-thirds of the votes cast on the Aphria Resolution
by Aphria Shareholders who vote virtually or by proxy at the Aphria Meeting;
|
•
|
that the Arrangement must be approved by the Court, which will consider, among other things, the fairness and reasonableness of
the Arrangement to the Aphria Shareholders;
|
•
|
the availability of Dissent Rights to registered Aphria Shareholders (for more information see “Description of the
Arrangement – Aphria Dissenting Shareholders’ Rights”);
|
•
|
the governance structure for the Combined Company, as reflected in the Arrangement Agreement, including:
|
•
|
the representation of directors from each of the Tilray Board and the Aphria Board on the board of directors of the Combined
Company, with the board including two directors from Tilray (including Mr. Brendan Kennedy), and seven directors from Aphria (including Mr. Irwin Simon, the current Aphria CEO, as the chairman of the board of the Combined Company);
|
•
|
that Mr. Kennedy, Tilray’s current CEO and one other director designated by Tilray, would be a member of the board of directors
of the Combined Company following the Arrangement, and the Tilray Board’s view of Mr. Kennedy as a leader with a strong reputation in the cannabis industry;
|
•
|
that Mr. Simon, the current Aphria CEO, would be the chief executive officer of the Combined Company following the Arrangement,
and the Tilray Board’s view of Mr. Simon as having a strong track record as chief executive officer of Aphria; and
|
•
|
that principal offices will be maintained in Canada (Toronto, Leamington, and Vancouver Island), the United States (New York
and Seattle), Portugal and Germany.
|
•
|
the possible diversion of management attention for an extended period of time during the pendency of the Arrangement and,
following closing, the challenge of combining the businesses of two major international companies;
|
•
|
the risk that the anticipated cost savings will not be achieved;
|
•
|
the costs that may be incurred to combine the operations of Aphria and Tilray;
|
•
|
the potential conflicts of interest of Aphria’s officers and directors in connection with the Arrangement (for more information
see “Description of the Arrangement – Interests of Aphria’s Directors and Management in the Arrangement”);
|
•
|
the risk of diverting management’s attention from other strategic priorities to implement integration efforts;
|
•
|
the risk that Aphria Shareholders will exercise Dissent Rights in connection with the Arrangement;
|
•
|
the risk that Tilray’s financial performance may not meet Aphria’s expectations;
|
•
|
the substantial costs to be incurred in connection with the Arrangement, including those that could be incurred regardless of
whether the Arrangement is consummated;
|
•
|
the ability of the Tilray Board, in certain circumstances, to terminate the Arrangement Agreement or change its recommendation
that Tilray Stockholders approve the Arrangement;
|
•
|
that Aphria would be required to pay to Tilray a termination fee of C$65 million in the event the Aphria Board were to
terminate the Arrangement Agreement under certain circumstances; and
|
•
|
the other risks associated with the Arrangement and the business of Aphria, Tilray and the Combined Company, including those
described under “Risk Factors – Risks Related to the Arrangement”, “Information Concerning Aphria – Risks and Uncertainties”, “Information Concerning Tilray – Risks and Uncertainties” and “Risk Factors – Risks Related to the Combined
Company”.
|
•
|
the strategic reasons for the Arrangement described above under “Description of the Arrangement – Our Reasons for the
Arrangement”;
|
•
|
information concerning the respective businesses of Aphria and Tilray, including information regarding financial performance
and condition, operations, technology and management, and the results of Tilray’s due diligence review of Aphria’s businesses and operations;
|
•
|
the current and prospective competitive environment in which cannabis companies, including Tilray, operate and the likely
effect of that competitive environment on Tilray in light of, and in the absence of, the Arrangement;
|
•
|
the analyses of, and discussions between, the Tilray Board and Tilray’s financial advisors and the financial advisors’ fairness
opinions to the effect that, as of the date of the fairness opinions, based upon and subject to the assumptions made, matters considered and limits of the review undertaken, the 0.8381 Exchange Ratio is fair, from a financial point of
view, to Tilray (for more information see “Description of the Arrangement – Opinion of Tilray’s Financial Advisors”);
|
•
|
the Exchange Ratio of 0.8381 of a Tilray Share for each Aphria Share, and the determination of the Tilray Board that the fixed
exchange ratio was appropriate in a strategic transaction of this type, as well as the
|
•
|
the expected treatment of the Arrangement as a tax-free reorganization under Section 368(a) of the Code for U.S. federal
income tax purposes, and of the Arrangement Agreement as a “plan of reorganization” under Treasury Regulation Section 1.368-2(g), as more fully described in the section entitled “Certain U.S. Federal Income Tax Considerations” beginning
on page 143 of this Circular;
|
•
|
the structure and terms of the Arrangement, including:
|
•
|
that on completion of the Arrangement, Tilray Stockholders will own approximately 38.8% of the outstanding Tilray Shares on
a fully diluted basis providing those Tilray Stockholders with the opportunity to participate in the future growth of the Combined Company;
|
•
|
that the Tilray Supporting Stockholders, who own, directly or indirectly, or exercise control or direction over, in the
aggregate, Tilray Shares representing approximately 6.6% of the outstanding Tilray Shares as of the date of this Circular, entered into the Tilray Support Agreements pursuant to which the Tilray Supporting Stockholders agreed, among
other things, to vote the subject securities in favour of the Tilray Resolutions (for more information see “General Information about the Tilray Meeting and Voting – Tilray Support Agreement”);
|
•
|
that the Aphria Supporting Shareholders, who own, directly or indirectly, or exercise control or direction over, in the
aggregate, Aphria Shares representing less than 1% of the outstanding Aphria Shares as of the date of this Circular, entered into the Aphria Support Agreements pursuant to which the Aphria Supporting Shareholders agreed, among other
things, to vote the subject securities in favour of the Aphria Resolution (for more information see “General Information about the Aphria Meeting and Voting – Aphria Support Agreement”);
|
•
|
the reciprocal nature of the terms of the Arrangement Agreement and the other transaction documents, including the parties’
representations, warranties and covenants and the Tilray Board’s determination that those terms and conditions were appropriate in a strategic transaction of this type;
|
•
|
the conditions to the completion of the Arrangement, and the Tilray Board’s view that while the completion of the Arrangement
is subject to various conditions, including certain approvals, such conditions and approvals were likely to be satisfied on a timely basis;
|
•
|
the provisions of the Arrangement Agreement designed to restrict the ability of the Parties to solicit third party Acquisition
Proposals but affording both sides the ability to consider and pursue an unsolicited Superior Proposal, the provisions of the Arrangement Agreement providing for the payment of the Aphria Termination Amount or the Tilray Termination
Amount, as applicable, under specified circumstances relating to the termination of the Arrangement Agreement following the occurrence of an Acquisition Proposal and the conclusion of the Tilray Board that those provisions were an
appropriate and reasonable means to increase the likelihood that the Arrangement will be completed;
|
•
|
the governance structure for the Combined Company, as reflected in the Arrangement Agreement, including:
|