We advised certain lenders under the term loan credit facility

Davis Polk advised certain lenders under Canopy Growth Corporation’s $750 million term loan credit facility in connection with a reorganization of Canopy’s U.S. assets, amendments to its credit agreement and commencement of an offer to purchase and prepay $187.5 million of the existing term loans. 

Pursuant to the loan purchase offer, which was backstopped by Davis Polk’s client, Canopy agreed to tender $187.5 million of the principal outstanding amount under the term loan facility at a discounted price set at 93% of par to be made in two equal payments: the first on November 10, 2022 and the second on April 17, 2022. The amendment executed in connection with the purchase offer and the reorganization provides for, among other modifications, reductions to the minimum liquidity covenant and the establishment of a new $100 million delayed drawn term loan. As a part of the asset reorganization transaction, Canopy created U.S. holding companies with exchangeable shares meant to enable the company to acquire full ownership of its U.S. cannabis investments by 2026.

Canopy is a leading diversified cannabis and cannabinoid-based consumer product company, offering product varieties in high-quality dried flower, oil, infused beverages and other similar products. Canopy has entered into the health and wellness consumer industry spaces in the United States, Canada and Europe.

The Davis Polk restructuring team included partner Eli J. Vonnegut, counsel Jon Finelli and associates Jonah A. Peppiatt and Mary Kudolo. Partner Kara L. Mungovan and associate Tyler Scheiner provided tax advice. All members of the Davis Polk team are based in the New York office.