Company: CGC
Filing Date: 2025-02-07
Form Type: 10-Q
Source: 0000950170-25-015839
Chunk: 6

Company: Canopy Growth Corp
Filing Date: 2025-02-07
Form: 10-Q
Item: Item 1
Chunk 6
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 realization of assets and the satisfaction of liabilities in the normal course of business.In the Company’s condensed interim consolidated financial statements for the period ended December 31, 2023, the Company raised substantial doubt about the Company’s ability to continue as a going concern for at least twelve months from the issuance of those condensed interim consolidated financial statements, due to certain material debt obligations coming due in the short-term, recurring losses from operations and additional required financing to fund its business and operations.As of the filing of the Annual Report, the Company had been able to successfully mitigate the substantial doubt by completing several balance sheet actions as further described in the Annual Report. During the nine months ended December 31, 2024, the Company completed additional actions and established the ATM Program (as defined below), issued and sold an aggregate of 39,519,029 common shares for gross proceeds of $255,989 under the ATM Program (see Note 19), amended the terms of the Credit Facility (as defined below) thereby extending the maturity date of the Credit Facility, made a mandatory US$100,000 prepayment of the Credit Facility, which significantly reduced the Company's short-term debt obligation, received additional proceeds from the liquidation and sale of assets of BioSteel Canada (as defined below), and entered into an amended facility lease, which is expected to reduce the Company's potential lease payment obligation.The Company continues to evaluate different strategies and may pursue additional actions that are expected to further increase its liquidity position, including, but not limited to, pursuing additional actions to find cost-savings and seeking additional financing from both the public and private markets through the issuance of equity and/or debt securities. As a result of management's plans 

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above and the financial results of the Company at December 31, 2024, management concludes that the substantial doubt about the Company’s ability to continue as a going concern continues to be alleviated.Principles of consolidationThese condensed interim consolidated financial statements include the accounts of the Company and all entities in which the Company either has a controlling voting interest or is the primary beneficiary of a variable interest entity. All intercompany accounts and transactions have been eliminated on consolidation.Variable interest entitiesA variable interest entity (“VIE”) is an entity that does not have sufficient equity at risk to finance its activities without additional subordinated financial support or is structured such that equity investors lack the ability to control the entity’s activities or do not substantially participate in the gains and losses of the entity. Upon inception of a contractual agreement, and thereafter, if a reconsideration event