Tilray Brands, Inc 8-K, filed Mar 31, 2020
Tilray Brands, Inc. (TLRY)
About this 8-K
Tilray Brands, Inc filed this 8-K on March 31, 2020, reporting on events of March 25, 2020.
Items reported
- Item 8.01: Other events
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Item 8.01Other Events.
Lock-Up Release
As previously announced, on December 12, 2019, Tilray, Inc. (“Tilray”) completed its transaction with Privateer Holdings, Inc., a Delaware corporation (“Privateer”), in accordance with the terms of the Agreement and Plan of Merger and Reorganization, dated as of September 9, 2019 (the “Merger Agreement”) by and among Tilray, Privateer, Down River Merger Sub, LLC, a Delaware limited liability company and wholly owned subsidiary of Tilray and Michael Blue, as the Stockholder Representative. Pursuant to the terms described in the Merger Agreement, Privateer merged with and into Merger Sub (the “Merger”), with Merger Sub surviving the Merger as a wholly owned subsidiary of Tilray.
Pursuant to the Merger Agreement, each Privateer equity holder who received shares of Tilray common stock in the Merger is subject to a lock-up (the “Lock-Up Agreement”) allowing for the sale of such shares only under certain circumstances over a two-year period. During the first year following the closing of the Merger, the Lock-Up Agreement provides that the subject shares are permitted to be sold pursuant to certain offerings, block trades or strategic sales approved or arranged by Tilray, at the discretion of its Board of Directors. At the end of the first year, the lock-up restrictions lapse with respect to 50 percent of the total shares subject to Lock-Up Agreement (with permitted sales being credited towards and included in such 50%) will be released. Over the course of the second year following the closing of the Merger, the remaining shares will be subject to a staggered release in four equal quarterly increments.
On March 25, 2020, the Board of Directors of Tilray unanimously approved the pro rata release of 11 million shares of Class 2 common stock from the Lock-Up Agreement as a permitted sale (the “Waiver and Release”), waiving the release requirements included in the Lock-Up Agreement and treating the release of such shares as permitted sales. The Waiver and Release will take effect on April 3, 2020, and the released shares may be sold on or after that date, subject to applicable securities law or contractual limitations.
The Waiver and Release will apply on a pro rata basis to each former Privateer equity holder who received shares of or options to purchase Tilray Class 2 common stock in the Merger, including certain of Tilray’s officers and directors.
The Waiver and Release applies to approximately 14.5% of the locked-up shares (including for purposes of such percentage calculation shares that remain subject to escrow and/or subject to outstanding assumed stock options).
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SIGNATURES
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 thereunto duly authorized.
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Tilray, Inc. |
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Date: March 31, 2020 |
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By: |
/s/ Brendan Kennedy |
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Brendan Kennedy |
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President and Chief Executive Officer |
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