0001193125-21-102876.txt : 20210401 0001193125-21-102876.hdr.sgml : 20210401 20210331215201 ACCESSION NUMBER: 0001193125-21-102876 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 27 FILED AS OF DATE: 20210401 DATE AS OF CHANGE: 20210331 GROUP MEMBERS: ANDREW DURKACZ GROUP MEMBERS: FIRST REPUBLIC CAPITAL CORP GROUP MEMBERS: FORTIUS RESEARCH & TRADING CORP GROUP MEMBERS: GLORIA DURKACZ GROUP MEMBERS: LEGACY FAMILY TRUST GROUP MEMBERS: REHAN SAEED GROUP MEMBERS: RICHARD GOLDSTEIN GROUP MEMBERS: XORAX FAMILY TRUST GROUP MEMBERS: ZACHARY DUTTON GROUP MEMBERS: ZEESHAN SAEED SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: FSD Pharma Inc. CENTRAL INDEX KEY: 0001771885 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 000000000 STATE OF INCORPORATION: A6 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-91661 FILM NUMBER: 21795802 BUSINESS ADDRESS: STREET 1: FIRST CANADIAN PLACE STREET 2: 100 KING STREET WEST, SUITE 3400 CITY: TORONTO STATE: A6 ZIP: M5X 1A4 BUSINESS PHONE: (416) 854-8884 MAIL ADDRESS: STREET 1: FIRST CANADIAN PLACE STREET 2: 100 KING STREET WEST, SUITE 3400 CITY: TORONTO STATE: A6 ZIP: M5X 1A4 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: DURKACZ ANTHONY CENTRAL INDEX KEY: 0001227533 FILING VALUES: FORM TYPE: SC 13D MAIL ADDRESS: STREET 1: 3006-2045 LAKESHORE BLVD. W. CITY: TORONTO STATE: A6 ZIP: M8V 2Z6 SC 13D 1 d147583dsc13d.htm SC 13D SC 13D

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No.     )*

 

 

FSD Pharma Inc.

(Name of Issuer)

Class B Subordinate Voting Shares, no par value per share

(Title of Class of Securities)

35954B206

(CUSIP Number)

Anthony Durkacz and Zeeshan Saeed

c/o Blake, Cassels & Graydon LLP

199 Bay Street

Suite 4000, Commerce Court West

Toronto, Ontario, M5L 1A9

Canada

With a copy to:

John D. Hancock, Esq.

Foley Hoag LLP

155 Seaport Blvd.

Boston, MA 02210

617-832-1201

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

December 20, 2020

(Date of Event which Requires Filing of this Statement)

 

 

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box.  ☐

 

 

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are sent.

 

 

 

*

The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

 

 

 


CUSIP No. 35954B206    13D    Page 2 of 21 Pages

 

  1.    

  Names of Reporting Persons.

 

  First Republic Capital Corporation

  2.  

  Check the Appropriate Box if a Member of a Group (See Instructions)

  (a)  ☒        (b)  ☐

 

  3.  

  SEC Use Only

 

  4.  

  Source of Funds (See Instructions)

 

  WC

  5.  

  Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)

 

  ☐

  6.  

  Citizenship or Place of Organization

 

  Ontario, Canada

Number of

Shares

Beneficially

Owned by

Each

Reporting

Person

With

 

     7.     

  Sole Voting Power

 

  170,418

     8.   

  Shared Voting Power

 

  0

     9.   

  Sole Dispositive Power

 

  170,418

   10.   

  Shared Dispositive Power

 

  0

11.    

  Aggregate Amount Beneficially Owned by Each Reporting Person

 

  170,418

12.  

  Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)

 

  ☐

13.  

  Percent of Class Represented by Amount in Row (11)

 

  0.5%

14.  

  Type of Reporting Person (See Instructions)

 

  CO


CUSIP No. 35954B206    13D    Page 3 of 21 Pages

 

  1.    

  Names of Reporting Persons.

 

  Fortius Research and Trading Corporation

  2.  

  Check the Appropriate Box if a Member of a Group (See Instructions)

  (a)  ☒        (b)  ☐

 

  3.  

  SEC Use Only

 

  4.  

  Source of Funds (See Instructions)

 

  WC

  5.  

  Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)

 

  ☐

  6.  

  Citizenship or Place of Organization

 

  Ontario, Canada

Number of

Shares

Beneficially

Owned by

Each

Reporting

Person

With

 

     7.     

  Sole Voting Power

 

  106,0671

     8.   

  Shared Voting Power

 

  0

     9.   

  Sole Dispositive Power

 

  106,067

   10.   

  Shared Dispositive Power

 

  0

11.    

  Aggregate Amount Beneficially Owned by Each Reporting Person

 

  106,067

12.  

  Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)

 

  ☐

13.  

  Percent of Class Represented by Amount in Row (11)

 

  0.3%2

14.  

  Type of Reporting Person (See Instructions)

 

  CO

 

1 

Consists of (i) 106,043 Class B Subordinate Voting Shares, no par value, of the Issuer (“Class B Shares”) held by the Reporting Person and (ii) 24 Class B Shares issuable to the Reporting Person upon conversion of 24 Class A Multiple Voting Shares, no par value, of the Issuer (“Class A Shares”) held by the Reporting Person. Each Class A Share is convertible at any time into one Class B Share.

2 

Each Class A Share is treated as converted into one Class B Share for purposes of computing the percentage ownership of the Reporting Person. Each Class A Share is entitled to 276,660 votes, and each Class B Share is entitled to one vote. The percentage reported does not reflect the 276,660-for-one voting power of the Class A shares.


CUSIP No. 35954B206    13D    Page 4 of 21 Pages

 

  1.    

  Names of Reporting Persons.

 

  Anthony Durkacz

  2.  

  Check the Appropriate Box if a Member of a Group (See Instructions)

  (a)  ☒        (b)  ☐

 

  3.  

  SEC Use Only

 

  4.  

  Source of Funds (See Instructions)

 

  PF, SC, AF

  5.  

  Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)

 

  ☐

  6.  

  Citizenship or Place of Organization

 

  Canada

Number of

Shares

Beneficially

Owned by

Each

Reporting

Person

With

 

     7.     

  Sole Voting Power

 

  472,1033

     8.   

  Shared Voting Power

 

  106,0674

     9.   

  Sole Dispositive Power

 

  472,103

   10.   

  Shared Dispositive Power

 

  106,067

11.    

  Aggregate Amount Beneficially Owned by Each Reporting Person

 

  578,170

12.  

  Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)

 

  ☐

13.  

  Percent of Class Represented by Amount in Row (11)

 

  1.6%

14.  

  Type of Reporting Person (See Instructions)

 

  HC, IN

 

3 

Consists of (i) 173,597 Class B Shares held by the Reporting Person, (ii) 99,502 Class B Shares issuable to the Reporting Person upon the exercise of outstanding stock options that are exercisable within 60 days of March 31, 2021, and (iii) 199,004 Class B Shares issuable to the Reporting Person upon the exercise of warrants that are exercisable within 60 days of March 31, 2021.

4 

Consists of shares held by Fortius Research and Trading Corporation.


CUSIP No. 35954B206    13D    Page 5 of 21 Pages

 

  1.    

  Names of Reporting Persons.

 

  Richard Goldstein

  2.  

  Check the Appropriate Box if a Member of a Group (See Instructions)

  (a)  ☒        (b)  ☐

 

  3.  

  SEC Use Only

 

  4.  

  Source of Funds (See Instructions)

 

  PF, AF

  5.  

  Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)

 

  ☐

  6.  

  Citizenship or Place of Organization

 

  Canada

Number of

Shares

Beneficially

Owned by

Each

Reporting

Person

With

 

     7.     

  Sole Voting Power

 

  7,000

     8.   

  Shared Voting Power

 

  170,4185

     9.   

  Sole Dispositive Power

 

  7,000

   10.   

  Shared Dispositive Power

 

  170,418

11.    

  Aggregate Amount Beneficially Owned by Each Reporting Person

 

  177,418

12.  

  Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)

 

  ☐

13.  

  Percent of Class Represented by Amount in Row (11)

 

  0.5%

14.  

  Type of Reporting Person (See Instructions)

 

  HC, IN

 

 

5 

Consists of shares held by First Republic Capital Corporation.


CUSIP No. 35954B206    13D    Page 6 of 21 Pages

 

  1.    

  Names of Reporting Persons.

 

  Andrew Durkacz

  2.  

  Check the Appropriate Box if a Member of a Group (See Instructions)

  (a)  ☒        (b)  ☐

 

  3.  

  SEC Use Only

 

  4.  

  Source of Funds (See Instructions)

 

  PF

  5.  

  Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)

 

  ☐

  6.  

  Citizenship or Place of Organization

 

  Canada

Number of

Shares

Beneficially

Owned by

Each

Reporting

Person

With

 

     7.     

  Sole Voting Power

 

  0

     8.   

  Shared Voting Power

 

  15,7326

     9.   

  Sole Dispositive Power

 

  0

   10.   

  Shared Dispositive Power

 

  15,732

11.    

  Aggregate Amount Beneficially Owned by Each Reporting Person

 

  15,732

12.  

  Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)

 

  ☐

13.  

  Percent of Class Represented by Amount in Row (11)

 

14.  

  Type of Reporting Person (See Instructions)

 

  IN

 

*

Less than 0.1%.

6 

Consists of 15,732 Class B Shares held jointly with Gloria Durkacz.


CUSIP No. 35954B206    13D    Page 7 of 21 Pages

 

  1.    

  Names of Reporting Persons.

 

  Gloria Durkacz

  2.  

  Check the Appropriate Box if a Member of a Group (See Instructions)

  (a)  ☒        (b)  ☐

 

  3.  

  SEC Use Only

 

  4.  

  Source of Funds (See Instructions)

 

  PF

  5.  

  Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)

 

  ☐

  6.  

  Citizenship or Place of Organization

 

  Canada

Number of

Shares

Beneficially

Owned by

Each

Reporting

Person

With

 

     7.     

  Sole Voting Power

 

  0

     8.   

  Shared Voting Power

 

  15,7327

     9.   

  Sole Dispositive Power

 

  0

   10.   

  Shared Dispositive Power

 

  15,732

11.    

  Aggregate Amount Beneficially Owned by Each Reporting Person

 

  15,732

12.  

  Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)

 

  ☐

13.  

  Percent of Class Represented by Amount in Row (11)

 

  *

14.  

  Type of Reporting Person (See Instructions)

 

  IN

 

*

Less than 0.1%.

7 

Consists of 15,732 Class B Shares held jointly with Andrew Durkacz.


CUSIP No. 35954B206    13D    Page 8 of 21 Pages

 

  1.    

  Names of Reporting Persons.

 

  Xorax Family Trust

  2.  

  Check the Appropriate Box if a Member of a Group (See Instructions)

  (a)  ☒        (b)  ☐

 

  3.  

  SEC Use Only

 

  4.  

  Source of Funds (See Instructions)

 

  AF, WC

  5.  

  Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)

 

  ☐

  6.  

  Citizenship or Place of Organization

 

  Ontario, Canada

Number of

Shares

Beneficially

Owned by

Each

Reporting

Person

With

 

     7.     

  Sole Voting Power

 

  317,5678

     8.   

  Shared Voting Power

 

  0

     9.   

  Sole Dispositive Power

 

  317,567

   10.   

  Shared Dispositive Power

 

  0

11.    

  Aggregate Amount Beneficially Owned by Each Reporting Person

 

  317,567

12.  

  Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)

 

  ☐

13.  

  Percent of Class Represented by Amount in Row (11)

 

  0.9%9

14.  

  Type of Reporting Person (See Instructions)

 

  OO

 

8 

Consists of (i) 317,543 Class B Shares held by the Reporting Person and (ii) 24 Class B Shares issuable to the Reporting Person upon conversion of 24 Class A Shares held by the Reporting Person. Each Class A Share is convertible at any time into one Class B Share.

9 

Each Class A Share is treated as converted into one Class B Share for purposes of computing the percentage ownership of the Reporting Person. Each Class A Share is entitled to 276,660 votes, and each Class B Share is entitled to one vote. The percentage reported does not reflect the 276,660-for-one voting power of the Class A shares.


CUSIP No. 35954B206    13D    Page 9 of 21 Pages

 

  1.    

  Names of Reporting Persons.

 

  Legacy Family Trust

  2.  

  Check the Appropriate Box if a Member of a Group (See Instructions)

  (a)  ☒        (b)  ☐

 

  3.  

  SEC Use Only

 

  4.  

  Source of Funds (See Instructions)

 

  AF, WC

  5.  

  Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)

 

  ☐

  6.  

  Citizenship or Place of Organization

 

  Ontario, Canada

Number of

Shares

Beneficially

Owned by

Each

Reporting

Person

With

 

     7.     

  Sole Voting Power

 

  137,00010

     8.   

  Shared Voting Power

 

  0

     9.   

  Sole Dispositive Power

 

  137,000

   10.   

  Shared Dispositive Power

 

  0

11.    

  Aggregate Amount Beneficially Owned by Each Reporting Person

 

  137,000

12.  

  Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)

 

  ☐

13.  

  Percent of Class Represented by Amount in Row (11)

 

  0.4%

14.  

  Type of Reporting Person (See Instructions)

 

  OO

 

10 

Consists of (i) 37,000 Class B Shares held by the Reporting Person and (ii) 100,000 Class B Shares issuable to the Reporting Person upon the exercise of outstanding stock options that are exercisable within 60 days of March 31, 2021.


CUSIP No. 35954B206    13D    Page 10 of 21 Pages

 

  1.    

  Names of Reporting Persons.

 

  Zeeshan Saeed

  2.  

  Check the Appropriate Box if a Member of a Group (See Instructions)

  (a)  ☒        (b)  ☐

 

  3.  

  SEC Use Only

 

  4.  

  Source of Funds (See Instructions)

 

  PF, SC, AF

  5.  

  Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)

 

  ☐

  6.  

  Citizenship or Place of Organization

 

  Canada

Number of

Shares

Beneficially

Owned by

Each

Reporting

Person

With

 

     7.     

  Sole Voting Power

 

  186,933

     8.   

  Shared Voting Power

 

  137,00011

     9.   

  Sole Dispositive Power

 

  186,933

   10.   

  Shared Dispositive Power

 

  137,000

11.    

  Aggregate Amount Beneficially Owned by Each Reporting Person

 

  323,933

12.  

  Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)

 

  ☐

13.  

  Percent of Class Represented by Amount in Row (11)

 

  0.9%

14.  

  Type of Reporting Person (See Instructions)

 

  HC, IN

 

11 

Consists of shares held by Legacy Family Trust and shares issuable upon exercise of outstanding stock options held by Legacy Family Trust.


CUSIP No. 35954B206    13D    Page 11 of 21 Pages

 

  1.    

  Names of Reporting Persons.

 

  Rehan Saeed

  2.  

  Check the Appropriate Box if a Member of a Group (See Instructions)

  (a)  ☒        (b)  ☐

 

  3.  

  SEC Use Only

 

  4.  

  Source of Funds (See Instructions)

 

  PF, SC, AF

  5.  

  Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)

 

  ☐

  6.  

  Citizenship or Place of Organization

 

  Canada

Number of

Shares

Beneficially

Owned by

Each

Reporting

Person

With

 

     7.     

  Sole Voting Power

 

  36,359

     8.   

  Shared Voting Power

 

  454,56712

     9.   

  Sole Dispositive Power

 

  36,359

   10.   

  Shared Dispositive Power

 

  454,567

11.    

  Aggregate Amount Beneficially Owned by Each Reporting Person

 

  490,926

12.  

  Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)

 

  ☐

13.  

  Percent of Class Represented by Amount in Row (11)

 

  1.4%

14.  

  Type of Reporting Person (See Instructions)

 

  IN

 

12 

Consists of shares held by Xorax Family and Legacy Family Trust and shares issuable upon exercise of outstanding stock options held by Legacy Family Trust.


CUSIP No. 35954B206    13D    Page 12 of 21 Pages

 

  1.    

  Names of Reporting Persons.

 

  Zachary Dutton

  2.  

  Check the Appropriate Box if a Member of a Group (See Instructions)

  (a)  ☒        (b)  ☐

 

  3.  

  SEC Use Only

 

  4.  

  Source of Funds (See Instructions)

 

  PF

  5.  

  Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)

 

  ☐

  6.  

  Citizenship or Place of Organization

 

  USA

Number of

Shares

Beneficially

Owned by

Each

Reporting

Person

With

 

     7.     

  Sole Voting Power

 

  164,412

     8.   

  Shared Voting Power

 

  0

     9.   

  Sole Dispositive Power

 

  164,412

   10.   

  Shared Dispositive Power

 

  0

11.    

  Aggregate Amount Beneficially Owned by Each Reporting Person

 

  164,412

12.  

  Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)

 

  ☐

13.  

  Percent of Class Represented by Amount in Row (11)

 

  0.5%

14.  

  Type of Reporting Person (See Instructions)

 

  IN


CUSIP No. 35954B206       Page 13 of 21 Pages

 

Item 1.

Security and Issuer

This joint statement on Schedule 13D relates to the Class B Subordinate Voting Shares, no par value per share (the “Class B Shares”), of FSD Pharma Inc., an Ontario corporation (the “Issuer”). The address of the Issuer’s principal executive offices is First Canadian Place, 100 King Street West, Suite 3400, Toronto, Ontario, M5X 1A4, Canada.

 

Item 2.

Identity and Background

 

  (a)

This joint statement on Schedule 13D is being filed by:

 

  (i)

First Republic Capital Corporation;

 

  (ii)

Fortius Research and Trading Corporation;

 

  (iii)

Anthony Durkacz;

 

  (iv)

Richard Goldstein;

 

  (v)

Andrew Durkacz;

 

  (vi)

Gloria Durkacz;

 

  (vii)

Xorax Family Trust;

 

  (viii)

Legacy Family Trust;

 

  (ix)

Zeeshan Saeed;

 

  (x)

Rehan Saeed; and

 

  (xi)

Zachary Dutton.

Each of the foregoing is referred to in this Schedule 13D as a “Reporting Person” and, collectively, as the “Reporting Persons.”

The Reporting Persons have entered into a Joint Filing Agreement dated March 31, 2021, a copy of which is filed as Exhibit 1 to this Schedule 13D, pursuant to which they have agreed to file this Schedule 13D jointly in accordance with Rule 13d-1(k) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

(b) The address of the principal office of First Republic Capital Corporation is 55 University Avenue, Suite 1003, Toronto, Ontario, M5J 2H7, Canada.

The address of the principal office of Fortius Research and Trading Corporation, and the business address of Anthony Durkacz, is 2045 Lakeshore Boulevard West, Suite 3006, Toronto, Ontario, M8V 2Z6, Canada.


CUSIP No. 35954B206       Page 14 of 21 Pages

 

The principal address of Richard Goldstein is 411 Cranbrooke Avenue, Toronto, Ontario, M5M 1N4, Canada.

The principal address of each of Andrew Durkacz and Gloria Durkacz is 158 Chapman Road, Toronto, Ontario, M9P 164, Canada.

The principal address of Zeeshan Saeed, and the address of the principal office of Xorax Family Trust, is 3688 Stratton Woods Court, Mississauga, Ontario, L5L 4V2, Canada.

The principal address of Rehan Saeed, and the address of the principal office of Legacy Family Trust, is 3682 Stratton Woods Court, Mississauga, Ontario, L5L 4V2, Canada.

The principal address of Zachary Dutton is 650 South Road, Holden, MA 01520.

(c) Anthony Durkacz serves as executive vice president and a director at First Republic Capital Corporation, an exempt market dealer based in Toronto, Canada. Richard Goldstein is the president and a director of First Republic Capital Corporation. Anthony Durkacz is also a director of the Issuer and the president of Fortius Research and Trading Corporation, which provides financial consulting services.

Andrew Durkacz and Gloria Durkacz are retired and have held no principal occupation or employment during the past five years.

Xorax Family Trust is a family trust of which Rehan Saeed is the trustee.

Legacy Family Trust is a family trust of which Zeeshan Saeed is the trustee.

Zeeshan Saeed served as the president of the Issuer from January 2018 to January 2021 and as a director of the Issuer from May 2018 to January 2021.

Rehan Saeed is a director and principal shareholder of AYA Financial Inc.

Zachary Dutton is currently an independent contractor and angel investor.

(d) None of the Reporting Persons has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

(e) None of the Reporting Persons was, during the last five years, a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and, as a result of such proceeding, was or is subject to a judgment, decree or final order (1) enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws, or (2) finding any violation with respect to such laws.

(f) Each of Anthony Durkacz, Richard Goldstein, Andrew Durkacz, Gloria Durkacz, Zeeshan Saeed and Rehan Saeed is a citizen of Canada; Zachary Dutton is a citizen of the United States; each of First Republic Capital Corporation and Fortius Research and Trading Corporation is a corporation organized under the laws of Ontario; and each of Xorax Family Trust and Legacy Family Trust is a trust organized under the laws of Ontario.


CUSIP No. 35954B206       Page 15 of 21 Pages

 

Item 3.

Source and Amount of Funds or Other Consideration

The Reporting Persons acquired beneficial ownership of an aggregate of 829,944 Class B Shares and 48 Class A Shares for CAD$12,153,559.26 and an aggregate of 37,000 Class B Shares for USD$54,390.00. The source of these funds was the working capital of the Reporting Persons that are entities and the personal funds of the Reporting Persons who are individuals. In addition, (i) Zeeshan Saeed was issued 186,933 Class B Shares as part of his compensation as an executive officer and director of the Issuer; (ii) Anthony Durkacz was issued 161,160 Class B Shares as compensation for his service as a director of the Issuer; (iii) Anthony Durkacz was issued the Durkacz Options (as defined below) as part of his compensation as a director of the Issuer; (iv) Legacy Family Trust was issued the Legacy Options (as defined below) in consideration for services rendered; and (v) the Warrants (as defined below) were granted to Anthony Durkacz in consideration for services rendered.

 

Item 4.

Purpose of Transaction

The Reporting Persons acquired beneficial ownership of Class B Shares based on their belief that the Class B Shares represent an attractive investment opportunity.

The Reporting Persons intend to review continuously their equity interest in the Issuer. Depending upon their evaluation of the factors described below, one or more of the Reporting Persons may from time to time purchase additional securities of the Issuer, dispose of all or a portion of the securities then held by such Reporting Persons, or cease buying or selling such securities; any such additional purchases or sales of securities of the Issuer may be in the open market, in privately negotiated transactions or otherwise.

On or about December 20, 2020, Anthony Durkacz and Zeeshan Saeed began to consider nominating a slate of directors for election to the Issuer’s Board of Directors (the “Board”), and on or about January 3, 2021, Mr. Durkacz and Mr. Saeed agreed to pursue the nomination of directors selected by them. Thereafter, they approached the other Reporting Persons to discuss joining the process. On January 4, 2021, certain of the Reporting Persons caused a letter to be delivered to the Issuer, which is attached hereto as Exhibit 13 and incorporated herein by reference, pursuant to the applicable provisions of the Business Corporations Act (Ontario), enclosing a requisition (the “Requisition”) for a special meeting of the Issuer’s shareholders (the “Requisitioned Meeting”). The Requisition was signed by each of the Reporting Persons other than Richard Goldstein (together, the “Requisitioning Shareholders”) and called for the Requisitioned Meeting to be held no later than March 15, 2021 to (i) remove Raza Bokhari, Stephen Buyer, Robert J. Ciaruffoli, James A. Datin, Gerald Golberg and Larry Kaiser from the Board, (ii) elect Lawrence Latowsky, Fernando Cugliari and Nitin Kaushal (together, the “Nominees”) to the Board, and (iii) fix the number of directors of the Issuer at five for the ensuing year (together, the “Meeting Matters”).

On January 22, 2021, the Issuer published a press release announcing that it would hold its annual meeting of shareholders on June 29, 2021.


CUSIP No. 35954B206       Page 16 of 21 Pages

 

On January 27, 2021, the Requisitioning Shareholders filed a Notice of Meeting and Record Date with the relevant Canadian securities regulatory authorities and listing exchanges, which is attached hereto as Exhibit 16 and incorporated herein by reference. Pursuant to the Notice of Meeting and Record Date, Anthony Durkacz and Zeeshan Saeed, on behalf of the Requisitioning Shareholders, called the Requisitioned Meeting to take place on March 31, 2021 with a record date of March 1, 2021. The Requisitioning Shareholders announced that the Requisitioned Meeting would occur on March 31, 2021 and provided additional details relating thereto in a press release dated January 27, 2021, which is attached hereto as Exhibit 17 and incorporated by reference herein. On March 8, 2021, the Requisitioning Shareholders published a press release, attached hereto as Exhibit 18 and incorporated herein by reference, regarding an order received from the Ontario Superior Court of Justice (Commercial List) (the “Court”) with respect to the Requisitioned Meeting, pursuant to which the Court ordered the Issuer to accelerate the date of its previously called annual meeting of shareholders to May 14, 2021 (the “Meeting”). As a result, the Requisitioned Meeting will not be required.

On March 17, 2021, the Requisitioning Shareholders filed an information circular with respect to the Meeting (the “Circular”), attached hereto as Exhibit 19 and incorporated herein by reference. The Requisitioning Shareholders intend to solicit proxies from shareholders of the Issuer with respect to the election of the Nominees at the Meeting and expect to issue a supplement or amendment to the Circular containing additional details concerning the Meeting and instructions for the completion of proxies and voting instruction forms to be provided by the Requisitioning Shareholders for use at the Meeting.

The Reporting Persons may, from time to time, modify their present intention as stated in this Item 4.

The Reporting Persons intend to continuously review their options but, except as set forth above, do not have at this time any other specific plans that would result in (a) the acquisition of additional securities of the Issuer or the disposition of securities of the Issuer; (b) any extraordinary corporate transactions such as a merger, reorganization or liquidation involving the Issuer or any of its subsidiaries; (c) any sale or transfer of a material amount of the assets of the Issuer or of any of its subsidiaries; (d) any change in the present management of the Issuer or Board, including any plans or proposals to change the number or term of directors or to fill any existing vacancies on the Board; (e) any material change in the present capitalization or dividend policy of the Issuer; (f) any other material change in the Issuer’s business or corporate structure; (g) any change in the Issuer’s charter or by-laws that may impede the acquisition of control of the Issuer by any person; (h) the Issuer’s Class B Shares being delisted from a national securities exchange or ceasing to be authorized to be quoted in an inter-dealer quotation system or a registered national securities association; (i) causing a class of equity securities of the Issuer to become eligible for termination of registration pursuant to Section 12(g)(4) of the Exchange Act; or (j) any action similar to those enumerated above. However, because Anthony Durkacz is a member of the Board of Directors of the Issuer, he may, from time to time, be involved in discussions which relate to one or more of the matters described in this Item 4. Anthony Durkacz disclaims any obligation to report on any plans or proposals with respect to the matters described in this Item 4 that develop or occur as a result of his role as a director of the Issuer and his participation in decisions regarding the Issuer’s actions.


CUSIP No. 35954B206       Page 17 of 21 Pages

 

Item 5.

Interest in Securities of the Issuer

(a, b) The percentages of beneficial ownership reported in this Item 5, and on each Reporting Person’s cover page to this Schedule 13D, are based on a total of 35,114,998 Class B Shares issued and outstanding as of March 16, 2021, as reported in the Issuer’s Management’s Discussion and Analysis, filed as Exhibit 99.3 to the Issuer’s Annual Report on Form 40-F for the fiscal year ended December 31, 2020. All of the share numbers reported below, and on each Reporting Person’s cover page to this Schedule 13D, are as of March 31, 2021, unless otherwise indicated. The cover page to this Schedule 13D for each Reporting Person is incorporated by reference in its entirety into this Item 5.

All share numbers reflected in this Schedule 13D reflect a 201-for-1 reverse stock split effected by the Issuer on or about October 16, 2019.

Class B Shares issuable pursuant to the conversion of Class A Shares or the exercise of stock options or warrants exercisable within 60 days of the filing of this Schedule 13D are deemed outstanding and held by each beneficial owner of such Class A Shares, options or warrants for purposes of computing the percentage of outstanding Class B Shares beneficially owned by such person, but are not deemed outstanding for purposes of computing the percentage of outstanding Class B Shares beneficially owned by any other person.

 

  (i)

First Republic Capital Corporation directly holds, and thus has sole voting and dispositive power over, 170,418 outstanding Class B Shares. Accordingly, First Republic Capital Corporation beneficially owns 170,418 Class B Shares, or approximately 0.5% of the outstanding Class B Shares.

 

  (ii)

Fortius Research and Trading Corporation directly holds, and thus has sole voting and dispositive power over, (a) 106,043 outstanding Class B Shares and (b) 24 Class B Shares issuable upon conversion of Class A Shares. Accordingly, Fortius Research and Trading Corporation beneficially owns 106,067 Class B Shares, or approximately 0.3% of the outstanding Class B Shares.

 

  (iii)

Anthony Durkacz directly holds, and thus has sole voting and dispositive power over, (a) 173,597 outstanding Class B Shares, (b) 99,502 Class B Shares issuable upon exercise of outstanding stock options exercisable within 60 days of March 31, 2021 and (c) 199,004 Class B Shares issuable upon exercise of outstanding warrants exercisable within 60 days of March 31, 2021. In addition, Mr. Durkacz has shared authority to vote (or direct the vote of), and to dispose (or direct the disposal) of, 106,043 outstanding Class B Shares and 24 Class B Shares issuable upon conversion of Class A Shares held by Fortius Research and Trading Corporation. Accordingly, Mr. Durkacz beneficially owns 578,170 Class B Shares, or approximately 1.6% of the outstanding Class B Shares. Mr. Durkacz acquired beneficial ownership of all of the foregoing shares more than 60 days before August 20, 2020, except that on such date he acquired 161,160 Class B Shares as compensation for his service on the Board of Directors of the Issuer (whereupon he beneficially owned approximately 5.5% of the Class B Shares).


CUSIP No. 35954B206       Page 18 of 21 Pages

 

  (iv)

Richard Goldstein directly holds, and thus has sole voting and dispositive power over, 7,000 outstanding Class B Shares. In addition, Mr. Goldstein has shared authority to vote (or direct the vote of), and to dispose (or direct the disposal) of, 170,418 Class B Shares held by First Republic Capital Corporation. Accordingly, Mr. Goldstein beneficially owns 177,418 Class B Shares, or approximately 0.5% of the outstanding Class B Shares.

 

  (v)

Each of Andrew Durkacz and Gloria Durkacz has shared authority to vote (or direct the vote of), and to dispose (or direct the disposal) of, 15,732 outstanding Class B Shares. Accordingly, each of Andrew Durkacz and Gloria Durkacz beneficially owns 15,732 Class B Shares, or less than 0.1% of the outstanding Class B Shares.

 

  (vi)

Xorax Family Trust directly holds, and thus has sole voting and dispositive power over, 317,567 Class B Shares, consisting of (a) 317,543 outstanding Class B Shares and (b) 24 Class B Shares issuable upon conversion of Class A Shares. Accordingly, Xorax Family Trust beneficially owns 317,567 Class B Shares, or approximately 0.9% of the outstanding Class B Shares.

 

  (vii)

Legacy Family Trust directly holds, and thus has sole voting and dispositive power over, (a) 37,000 outstanding Class B Shares and (b) 100,000 Class B Shares issuable upon exercise of outstanding stock options exercisable within 60 days of March 31, 2021. Accordingly, Legacy Family Trust beneficially owns 137,000 Class B Shares, or approximately 0.4% of the outstanding Class B Shares.

 

  (viii)

Zeeshan Saeed directly holds, and thus has sole voting and dispositive power over, 186,933 outstanding Class B Shares. In addition, Mr. Saeed has shared authority to vote (or direct the vote of), and to dispose (or direct the disposal) of, 37,000 Class B Shares held by Legacy Family Trust and 100,000 Class B Shares issuable upon exercise of outstanding stock options held by Legacy Family Trust. Accordingly, Mr. Saeed beneficially owns 323,933 Class B Shares, or approximately 0.9% of the outstanding Class B Shares.

 

  (ix)

Rehan Saeed directly holds, and thus has sole voting and dispositive power over, 36,359 outstanding Class B Shares. In addition, Mr. Saeed has shared authority to vote (or direct the vote of), and to dispose (or direct the disposal) of, (a) 317,543 Class B Shares held by Xorax Family Trust and 24 Class B Shares issuable upon conversion of Class A Shares held by Xorax Family Trust and (b) 37,000 Class B Shares held by Legacy Family Trust and 100,000 Class B Shares issuable upon exercise of outstanding stock options held by Legacy Family Trust. Accordingly, Mr. Saeed beneficially owns 490,926 Class B Shares, or approximately 1.4% of the outstanding Class B Shares.

 

  (x)

Zachary Dutton directly holds, and thus has sole voting and dispositive power over, 164,412 outstanding Class B Shares. Accordingly, Mr. Dutton beneficially owns 164,412 Class B Shares, or approximately 0.5% of the outstanding Class B Shares.


CUSIP No. 35954B206       Page 19 of 21 Pages

 

The Reporting Persons beneficially own, in the aggregate, 1,613,591 Class B Shares, or approximately 4.5% of the outstanding Class B Shares.

Each Reporting Person, as a member of a “group” for purposes of Section 13(d)(3) of the Exchange Act, may be deemed the beneficial owner of the Class B Shares directly owned by the other Reporting Persons. Each Reporting Person disclaims beneficial ownership of such Class B Shares except to the extent of his, her or its pecuniary interest therein.

(c) No Reporting Person, other than Legacy Family Trust as set forth in the table below, effected any transaction in the Class B Shares since January 30, 2021 (the date 60 days prior to the filing of this Schedule 13D):

 

Date of Sale

   Shares Sold (#)      Sale Price per Share  

2/9/2021

     38,823      CAD$ 3.80  

2/10/2021

     30,000      USD$ 3.80  

The above listed transactions were conducted in the ordinary course of business on the open market for cash. The purchase prices do not reflect brokerage commissions paid.

(d) No person other than the Reporting Persons is known to have the right to receive or the power to direct the receipt of dividends from or the proceeds from the sale of Class B Shares.

(e) Not applicable.

 

Item 6.

Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer

The following description of certain agreements and other documents does not purport to be complete and is qualified in its entirety by reference to the terms and conditions of such agreements and other documents, copies of which are filed as exhibits hereto and are incorporated by reference in their entirety into this Item 6.

Stock Options

In connection with Anthony Durkacz’s service as Executive Co-Chairman of the Issuer, the Issuer granted to Mr. Durkacz a stock option to purchase 99,502 Class B Shares on March 24, 2020 (the “Durkacz Options”). In consideration for services provided, the Issuer granted to Legacy Family Trust a stock option to purchase 100,000 Class B Shares on December 20, 2019 (the “Legacy Options”).

Warrants

In consideration for services provided, on May 24, 2018, the Issuer issued to Anthony Durkacz warrants to purchase 199,004 Class B Shares (the “Warrants”).


CUSIP No. 35954B206       Page 20 of 21 Pages

 

Except as otherwise described in this Schedule 13D, including the Exhibits attached hereto, there are no contracts, arrangements, understandings, or relationships (legal or otherwise) among the Reporting Persons, or between any Reporting Person(s) and any third party, with respect to any securities of the Issuer, including, but not limited to, those involving the transfer or voting of any of the securities, finder’s fees, joint ventures, loan or option arrangements, put or calls, guarantees of profits, division of profits or losses, or the giving or withholding of proxies.

 

Item 7.

Material to be Filed as Exhibits

Exhibit 1    Joint Filing Agreement dated as of March 31, 2021.
Exhibit 2    Confirming Statement of First Republic Capital Corporation dated March 31, 2021.
Exhibit 3    Confirming Statement of Fortius Research and Trading Corporation dated March 31, 2021.
Exhibit 4    Confirming Statement of Anthony Durkacz dated March 31, 2021.
Exhibit 5    Confirming Statement of Richard Goldstein dated March 31, 2021.
Exhibit 6    Confirming Statement of Andrew Durkacz dated March 31, 2021.
Exhibit 7    Confirming Statement of Gloria Durkacz dated March 31, 2021.
Exhibit 8    Confirming Statement of Xorax Family Trust dated March 31, 2021.
Exhibit 9    Confirming Statement of Legacy Family Trust dated March 31, 2021.
Exhibit 10    Confirming Statement of Zeeshan Saeed dated March 31, 2021.
Exhibit 11    Confirming Statement of Rehan Saeed dated March 31, 2021.
Exhibit 12    Confirming Statement of Zachary Dutton dated March 31, 2021.
Exhibit 13    Letter dated January 4, 2021 enclosing Requisition.
Exhibit 14    Form of Stock Option.
Exhibit 15    Form of Warrant.
Exhibit 16    Notice of Meeting and Record Date.
Exhibit 17    Press Release dated January 27, 2021.
Exhibit 18    Press Release dated March 8, 2021.
Exhibit 19    Information Circular dated March 17, 2021.

[signature pages follow]


CUSIP No. 35954B206       Page 21 of 21 Pages

 

Signature

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

 

 

      DATE: March 31, 2021
FIRST REPUBLIC CAPITAL CORPORATION    
     

/s/ Anthony Durkacz

By:  

/s/ Anthony Durkacz

    Anthony Durkacz
Name: Anthony Durkacz    
Title: Authorized Signatory    
     

/s/ Richard Goldstein

FORTIUS RESEARCH AND TRADING CORPORATION     Richard Goldstein
     

/s/ Andrew Durkacz

By:  

/s/ Anthony Durkacz

    Andrew Durkacz
Name: Anthony Durkacz    
Title: Authorized Signatory    

/s/ Gloria Durkacz

      Gloria Durkacz
XORAX FAMILY TRUST    
     

/s/ Zeeshan Saeed

By:  

/s/ Rehan Saeed

    Zeeshan Saeed
Name: Rehan Saeed    
Title: Authorized Signatory    
     

/s/ Rehan Saeed

LEGACY FAMILY TRUST     Rehan Saeed
By:  

/s/ Zeeshan Saeed

   

/s/ Zachary Dutton

Name: Zeeshan Saeed     Zachary Dutton
Title: Authorized Signatory    
EX-99.1 2 d147583dex991.htm EX-99.1 EX-99.1
CUSIP No. 35954B206       Page 1 of 1 Page

 

Exhibit 1

JOINT FILING AGREEMENT

Pursuant to Rule 13d-1(k)(1) under the Securities Exchange Act of 1934, as amended, the undersigned hereby agree, as of March 31, 2021, that only one statement containing the information required by Schedule 13D, and each amendment thereto, need be filed with respect to the ownership by each of the undersigned of Class B Subordinate Voting Shares of FSD Pharma Inc., an Ontario corporation, and such statement to which this Joint Filing Agreement is attached as Exhibit 1 is filed on behalf of each of the undersigned.

 

FIRST REPUBLIC CAPITAL CORPORATION    
     

/s/ Anthony Durkacz

By:  

/s/ Anthony Durkacz

    Anthony Durkacz
Name: Anthony Durkacz    
Title: Authorized Signatory    
     

/s/ Richard Goldstein

FORTIUS RESEARCH AND TRADING CORPORATION     Richard Goldstein
     

/s/ Andrew Durkacz

By:  

/s/ Anthony Durkacz

    Andrew Durkacz
Name: Anthony Durkacz    
Title: Authorized Signatory    

/s/ Gloria Durkacz

      Gloria Durkacz
XORAX FAMILY TRUST    
     

/s/ Zeeshan Saeed

By:  

/s/ Rehan Saeed

    Zeeshan Saeed
Name: Rehan Saeed    
Title: Authorized Signatory    
     

/s/ Rehan Saeed

LEGACY FAMILY TRUST     Rehan Saeed
By:  

/s/ Zeeshan Saeed

   

/s/ Zachary Dutton

Name: Zeeshan Saeed     Zachary Dutton
Title: Authorized Signatory    
EX-99.2 3 d147583dex992.htm EX-99.2 EX-99.2

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Exhibit 2

CONFIRMING STATEMENT

This Statement confirms that the undersigned has authorized and designated Anthony Durkacz and Zeeshan Saeed, each acting singly, to execute and file on the undersigned’s behalf all Forms 3, 4 and 5, Schedule 13G and Schedule 13D (including any amendments thereto) that the undersigned may be required to file with the U.S. Securities and Exchange Commission as a result of the undersigned’s ownership of or transactions in securities of FSD Pharma Inc., an Ontario corporation. The authority of Anthony Durkacz and Zeeshan Saeed under this Statement shall continue until the undersigned is no longer required to file any of Forms 3, 4 and 5, Schedule 13G and Schedule 13D with regard to the undersigned’s ownership of or transactions in securities of FSD Pharma Inc. unless earlier revoked in writing. The undersigned acknowledges that Anthony Durkacz and Zeeshan Saeed are not assuming any of the undersigned’s responsibilities to comply with Section 16 or Section 13 of the Securities Exchange Act of 1934, as amended.

 

Dated: March 31, 2021       FIRST REPUBLIC CAPITAL CORP.
     

/s/ Anthony Durkacz

      Name: Anthony Durkacz
      Title: Authorized Signatory
EX-99.3 4 d147583dex993.htm EX-99.3 EX-99.3

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Exhibit 3

CONFIRMING STATEMENT

This Statement confirms that the undersigned has authorized and designated Anthony Durkacz and Zeeshan Saeed, each acting singly, to execute and file on the undersigned’s behalf all Forms 3, 4 and 5, Schedule 13G and Schedule 13D (including any amendments thereto) that the undersigned may be required to file with the U.S. Securities and Exchange Commission as a result of the undersigned’s ownership of or transactions in securities of FSD Pharma Inc., an Ontario corporation. The authority of Anthony Durkacz and Zeeshan Saeed under this Statement shall continue until the undersigned is no longer required to file any of Forms 3, 4 and 5, Schedule 13G and Schedule 13D with regard to the undersigned’s ownership of or transactions in securities of FSD Pharma Inc. unless earlier revoked in writing. The undersigned acknowledges that Anthony Durkacz and Zeeshan Saeed are not assuming any of the undersigned’s responsibilities to comply with Section 16 or Section 13 of the Securities Exchange Act of 1934, as amended.

 

Dated: March 31, 2021       FORTIUS RESEARCH AND TRADING CORP.
     

/s/ Anthony Durkacz

      Name: Anthony Durkacz
      Title: Authorized Signatory
EX-99.4 5 d147583dex994.htm EX-99.4 EX-99.4

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Exhibit 4

CONFIRMING STATEMENT

This Statement confirms that the undersigned has authorized and designated Zeeshan Saeed to execute and file on the undersigned’s behalf all Forms 3, 4 and 5, Schedule 13G and Schedule 13D (including any amendments thereto) that the undersigned may be required to file with the U.S. Securities and Exchange Commission as a result of the undersigned’s ownership of or transactions in securities of FSD Pharma Inc., an Ontario corporation. The authority of Zeeshan Saeed under this Statement shall continue until the undersigned is no longer required to file any of Forms 3, 4 and 5, Schedule 13G and Schedule 13D with regard to the undersigned’s ownership of or transactions in securities of FSD Pharma Inc. unless earlier revoked in writing. The undersigned acknowledges that Zeeshan Saeed is not assuming any of the undersigned’s responsibilities to comply with Section 16 or Section 13 of the Securities Exchange Act of 1934, as amended.

 

Dated: March 31, 2021      

/s/ Anthony Durkacz

      Anthony Durkacz
EX-99.5 6 d147583dex995.htm EX-99.5 EX-99.5

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Exhibit 5

CONFIRMING STATEMENT

This Statement confirms that the undersigned has authorized and designated Anthony Durkacz and Zeeshan Saeed, each acting singly, to execute and file on the undersigned’s behalf all Forms 3, 4 and 5, Schedule 13G and Schedule 13D (including any amendments thereto) that the undersigned may be required to file with the U.S. Securities and Exchange Commission as a result of the undersigned’s ownership of or transactions in securities of FSD Pharma Inc., an Ontario corporation. The authority of Anthony Durkacz and Zeeshan Saeed under this Statement shall continue until the undersigned is no longer required to file any of Forms 3, 4 and 5, Schedule 13G and Schedule 13D with regard to the undersigned’s ownership of or transactions in securities of FSD Pharma Inc. unless earlier revoked in writing. The undersigned acknowledges that Anthony Durkacz and Zeeshan Saeed are not assuming any of the undersigned’s responsibilities to comply with Section 16 or Section 13 of the Securities Exchange Act of 1934, as amended.

 

Dated: March 31, 2021      

/s/ Richard Goldstein

      Richard Goldstein
EX-99.6 7 d147583dex996.htm EX-99.6 EX-99.6

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Exhibit 6

CONFIRMING STATEMENT

This Statement confirms that the undersigned has authorized and designated Anthony Durkacz and Zeeshan Saeed, each acting singly, to execute and file on the undersigned’s behalf all Forms 3, 4 and 5, Schedule 13G and Schedule 13D (including any amendments thereto) that the undersigned may be required to file with the U.S. Securities and Exchange Commission as a result of the undersigned’s ownership of or transactions in securities of FSD Pharma Inc., an Ontario corporation. The authority of Anthony Durkacz and Zeeshan Saeed under this Statement shall continue until the undersigned is no longer required to file any of Forms 3, 4 and 5, Schedule 13G and Schedule 13D with regard to the undersigned’s ownership of or transactions in securities of FSD Pharma Inc. unless earlier revoked in writing. The undersigned acknowledges that Anthony Durkacz and Zeeshan Saeed are not assuming any of the undersigned’s responsibilities to comply with Section 16 or Section 13 of the Securities Exchange Act of 1934, as amended.

 

Dated: March 31, 2021      

/s/ Andrew Durkacz

      Andrew Durkacz
EX-99.7 8 d147583dex997.htm EX-99.7 EX-99.7

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Exhibit 7

CONFIRMING STATEMENT

This Statement confirms that the undersigned has authorized and designated Anthony Durkacz and Zeeshan Saeed, each acting singly, to execute and file on the undersigned’s behalf all Forms 3, 4 and 5, Schedule 13G and Schedule 13D (including any amendments thereto) that the undersigned may be required to file with the U.S. Securities and Exchange Commission as a result of the undersigned’s ownership of or transactions in securities of FSD Pharma Inc., an Ontario corporation. The authority of Anthony Durkacz and Zeeshan Saeed under this Statement shall continue until the undersigned is no longer required to file any of Forms 3, 4 and 5, Schedule 13G and Schedule 13D with regard to the undersigned’s ownership of or transactions in securities of FSD Pharma Inc. unless earlier revoked in writing. The undersigned acknowledges that Anthony Durkacz and Zeeshan Saeed are not assuming any of the undersigned’s responsibilities to comply with Section 16 or Section 13 of the Securities Exchange Act of 1934, as amended.

 

Dated: March 31, 2021      

/s/ Gloria Durkacz

      Gloria Durkacz
EX-99.8 9 d147583dex998.htm EX-99.8 EX-99.8

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Exhibit 8

CONFIRMING STATEMENT

This Statement confirms that the undersigned has authorized and designated Anthony Durkacz and Zeeshan Saeed, each acting singly, to execute and file on the undersigned’s behalf all Forms 3, 4 and 5, Schedule 13G and Schedule 13D (including any amendments thereto) that the undersigned may be required to file with the U.S. Securities and Exchange Commission as a result of the undersigned’s ownership of or transactions in securities of FSD Pharma Inc., an Ontario corporation. The authority of Anthony Durkacz and Zeeshan Saeed under this Statement shall continue until the undersigned is no longer required to file any of Forms 3, 4 and 5, Schedule 13G and Schedule 13D with regard to the undersigned’s ownership of or transactions in securities of FSD Pharma Inc. unless earlier revoked in writing. The undersigned acknowledges that Anthony Durkacz and Zeeshan Saeed are not assuming any of the undersigned’s responsibilities to comply with Section 16 or Section 13 of the Securities Exchange Act of 1934, as amended.

 

Dated: March 31, 2021       XORAX FAMILY TRUST
     

/s/ Rehan Saeed

      Name: Rehan Saeed
      Title: Authorized Signatory
EX-99.9 10 d147583dex999.htm EX-99.9 EX-99.9

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Exhibit 9

CONFIRMING STATEMENT

This Statement confirms that the undersigned has authorized and designated Anthony Durkacz and Zeeshan Saeed, each acting singly, to execute and file on the undersigned’s behalf all Forms 3, 4 and 5, Schedule 13G and Schedule 13D (including any amendments thereto) that the undersigned may be required to file with the U.S. Securities and Exchange Commission as a result of the undersigned’s ownership of or transactions in securities of FSD Pharma Inc., an Ontario corporation. The authority of Anthony Durkacz and Zeeshan Saeed under this Statement shall continue until the undersigned is no longer required to file any of Forms 3, 4 and 5, Schedule 13G and Schedule 13D with regard to the undersigned’s ownership of or transactions in securities of FSD Pharma Inc. unless earlier revoked in writing. The undersigned acknowledges that Anthony Durkacz and Zeeshan Saeed are not assuming any of the undersigned’s responsibilities to comply with Section 16 or Section 13 of the Securities Exchange Act of 1934, as amended.

 

Dated: March 31, 2021       LEGACY FAMILY TRUST
     

/s/ Zeeshan Saeed

      Name: Zeeshan Saeed
      Title: Authorized Signatory
EX-99.10 11 d147583dex9910.htm EX-99.10 EX-99.10

CUSIP No. 35954B206

  

Page 1 of 1 Page

Exhibit 10

CONFIRMING STATEMENT

This Statement confirms that the undersigned has authorized and designated Anthony Durkacz to execute and file on the undersigned’s behalf all Forms 3, 4 and 5, Schedule 13G and Schedule 13D (including any amendments thereto) that the undersigned may be required to file with the U.S. Securities and Exchange Commission as a result of the undersigned’s ownership of or transactions in securities of FSD Pharma Inc., an Ontario corporation. The authority of Anthony Durkacz under this Statement shall continue until the undersigned is no longer required to file any of Forms 3, 4 and 5, Schedule 13G and Schedule 13D with regard to the undersigned’s ownership of or transactions in securities of FSD Pharma Inc. unless earlier revoked in writing. The undersigned acknowledges that Anthony Durkacz is not assuming any of the undersigned’s responsibilities to comply with Section 16 or Section 13 of the Securities Exchange Act of 1934, as amended.

 

Dated: March 31, 2021      

/s/ Zeeshan Saeed

      Zeeshan Saeed
EX-99.11 12 d147583dex9911.htm EX-99.11 EX-99.11

CUSIP No. 35954B206

  

Page 1 of 1 Page

Exhibit 11

CONFIRMING STATEMENT

This Statement confirms that the undersigned has authorized and designated Anthony Durkacz and Zeeshan Saeed, each acting singly, to execute and file on the undersigned’s behalf all Forms 3, 4 and 5, Schedule 13G and Schedule 13D (including any amendments thereto) that the undersigned may be required to file with the U.S. Securities and Exchange Commission as a result of the undersigned’s ownership of or transactions in securities of FSD Pharma Inc., an Ontario corporation. The authority of Anthony Durkacz and Zeeshan Saeed under this Statement shall continue until the undersigned is no longer required to file any of Forms 3, 4 and 5, Schedule 13G and Schedule 13D with regard to the undersigned’s ownership of or transactions in securities of FSD Pharma Inc. unless earlier revoked in writing. The undersigned acknowledges that Anthony Durkacz and Zeeshan Saeed are not assuming any of the undersigned’s responsibilities to comply with Section 16 or Section 13 of the Securities Exchange Act of 1934, as amended.

 

Dated: March 31, 2021      

/s/ Rehan Saeed

      Rehan Saeed
EX-99.12 13 d147583dex9912.htm EX-99.12 EX-99.12

CUSIP No. 35954B206

  

Page 1 of 1 Page

Exhibit 12

CONFIRMING STATEMENT

This Statement confirms that the undersigned has authorized and designated Anthony Durkacz and Zeeshan Saeed, each acting singly, to execute and file on the undersigned’s behalf all Forms 3, 4 and 5, Schedule 13G and Schedule 13D (including any amendments thereto) that the undersigned may be required to file with the U.S. Securities and Exchange Commission as a result of the undersigned’s ownership of or transactions in securities of FSD Pharma Inc., an Ontario corporation. The authority of Anthony Durkacz and Zeeshan Saeed under this Statement shall continue until the undersigned is no longer required to file any of Forms 3, 4 and 5, Schedule 13G and Schedule 13D with regard to the undersigned’s ownership of or transactions in securities of FSD Pharma Inc. unless earlier revoked in writing. The undersigned acknowledges that Anthony Durkacz and Zeeshan Saeed are not assuming any of the undersigned’s responsibilities to comply with Section 16 or Section 13 of the Securities Exchange Act of 1934, as amended.

 

Dated: March 31, 2021      

/s/ Zachary Dutton

      Zachary Dutton
EX-99.13 14 d147583dex9913.htm EX-99.13 EX-99.13

Exhibit 13

 

LOGO

 

   Christopher Jones
January 4, 2021    Partner
   Dir: 416-863-2704
VIA PERSONAL DELIVERY AND E-MAIL    christopher.jones@blakes.com

Alan P. Gardner

Bennett Jones LLP

3400 One First Canadian Place, PO Box 130

Toronto, Ontario,

Canada M5X 1A4

Members of the Board of Directors of FSD

Pharma Inc.

c/o Bennett Jones LLP

3400 One First Canadian Place, PO Box 130

Toronto, Ontario,

Canada M5X 1A4

RE: Requisition of Special Meeting of the Shareholders of FSD Pharma Inc. (the “Company”)

Dear Mr. Gardner:

Please find enclosed a requisition (the “Requisition”) for a special meeting of the Company’s shareholders for the purpose of transacting the business referenced therein. Your offices are the

Company’s current registered address but copies have been delivered concurrently to the Company’s head office address and, in light of the pandemic restrictions in place, by email to you and the other Bennett Jones counsel that you have identified as acting for the Company.

Our clients regret having to take this action, but have concluded they have no alternative if they are to address the readily apparent governance and management issues of the Company on a timely basis in an effort address the Company’s dramatic decline. At a time when peer companies have experienced strong performance, FSD Pharma’s shareholders have suffered an enormous loss in value. Since October 29, 2018, the date of the announcement of Mr. Bokhari’s appointment as the Company’s Chief

Executive Officer, the Company has lost over $600 million in market capitalization, with its share price dropping from C$94.47 to C$1.99—a stunning decline of over 97%. It is clear that on its current trajectory, and under the leadership of its current board of directors and Chief Executive Officer, the very viability of the Company is now in question.

Over the past months, Messrs. Durkacz and Saeed have attempted to work with the current board and Company management on a turnaround plan for the Company. To their regret and alarm, the board and management have responded with indifference and a complete lack of urgency in response to this outreach.

 

LOGO


LOGO

 

LOGO    Page 2

Most recently, the Company’s board of directors have simply disregarded two valid requisitions for a board meeting. In the case of the second meeting, a time and date were chosen in response to comments from directors who failed to attend the first meeting. It was clearly communicated that this was intended to be a brief meeting to discuss an appropriate process for objectively considering a specific and time-sensitive proposal and other similar opportunities that might arise. Despite the fact that the meeting was scheduled during a holiday period in which people in Canada and the United States had been advised to avoid travel, and consequently most citizens were readily available to attend a telephone call or online meeting, no directors attended the second meeting. Our clients attribute this to the clear efforts of the Company’s Chief Executive Officer to frustrate these meetings, and thereby the effective functioning of the Company’s governance structure.

While our clients had hoped that they might find a way to effectively manage this issue through the engagement of the independent directors, that avenue has, unfortunately, been denied them through a determined campaign of disruption, with which the current board is complicit

Apart from the goal of considering the specific opportunity that our clients sought to discuss with the board, it has become apparent that, as currently constituted, the Company’s governance has become dysfunctional, and incapable of addressing the critical and urgent challenges facing the Company. As shareholders with a significant economic interest in the Company, our clients have determined to take all steps required to address this failing.

If the Company is to be saved, and at least some of the lost shareholder value recovered, urgent action is essential. We trust you agree that the Company’s shareholders are entitled to be heard, and heard in a timely fashion. For this reason we anticipate and look forward to your cooperation in scheduling the meeting as set out in the Requisition for no later than March 15, 2021.

To ensure that the Company’s board has the benefit of the complete record of our recent correspondence, we also ask for confirmation that our letter of December 29, 2020 and your response dated December 30, 2020 have been shared with them.

We also note that, on December 21, 2020, we submitted a request for a list of the Company’s shareholders in accordance with the OBCA, along with the required supporting affidavit. As you are aware, the OBCA requires the Company to respond within 10 days. That deadline has come and gone with no response, so we reiterate our request to receive these materials on a timely basis as required by the OBCA.

Sincerely,

/s/ Christopher Jones

Christopher Jones

 

c.

Anthony Durkacz

  

Zeeshan Saeed

  

Seumas Woods, Blakes

  

Doug McLeod, Blakes

  

Aaron Sonshine, Bennett Jones

  

Jeff Kerbel, Bennett Jones

  

Joseph Blinick, Bennett Jones

 

LOGO


January 4, 2021

REQUISITION OF A SPECIAL MEETING OF SHAREHOLDERS

 

TO:    FSD Pharma Inc. (the “Corporation”)
AND TO:    Board of Directors of the Corporation (the “Board of Directors”)
RE:    Requisition of Special Meeting of the Corporation’s Shareholders

 

 

This requisition is provided to the Corporation and to the Board of Directors pursuant to section 105(1) of the Business Corporations Act (Ontario) (the “OBCA”). The undersigned shareholders are, cumulatively, the registered holders of not less than 5 percent of the issued shares of the Corporation that carry the right to vote at meetings of the Corporation and hereby requisition a special meeting of shareholders of the Corporation for the purpose of transacting the business as set out below.

Business to be Transacted

To consider and if thought fit, to pass the following resolutions in the order set out below:    

 

  (a)

Pursuant to subsection 122(1) of the OBCA, to remove Raza Bokhari, Steven Buyer, Robert J. Ciaruffoli, James A. Datin, Gerald Goldberg and Larry Kaiser from the Board of Directors;

 

  (b)

Pursuant to subsection 122(3) of the OBCA, to elect Larry Latowsky, Fernando Cugliari, and Nitin Kaushal (the “Proposed Directors”) to the Board of Directors;

 

  (c)

Pursuant to subsections 125(1) and 125(3) of the OBCA, to fix the number of Directors of the Corporation at five for the ensuing year; and,

 

  (d)

To conduct such other business as may properly come before the meeting, including any matter necessary to implement the foregoing.

Professional qualifications and other material information for the Proposed Directors is attached as Schedule “A”.

The undersigned shareholders expect the Board of Directors to comply with their obligation to call a meeting of shareholders of the Corporation no later than 21 days after the date of this requisition, and similarly expect the Board of Directors to schedule the requisitioned meeting in a timely and expeditious manner, and by March 15, 2021 at the latest.


Thank you for your attention to this matter.

Sincerely,

 

/s/ Anthony Durkacz

  

January 3, 2021

Anthony Durkacz

 

   Date

/s/ Anthony Durkacz

  

January 3, 2021

First Republic Capital Corporation

 

   Date

/s/ Andrew Durkacz

  

January 3, 2021

Andrew Durkacz

 

   Date

/s/ Gloria Durkacz

  

January 3, 2021

Gloria Durkacz

 

   Date

/s/ Anthony Durkacz

  

January 3, 2021

Fortius Research and Trading Corp

 

   Date

/s/ Zeeshan Saeed

  

January 3, 2021

Zeeshan Saeed

 

   Date

/s/ Zeeshan Saeed

  

January 3, 2021

Zeeshan Saeed TR Xorax Family Trust

 

   Date

/s/ Rehan Saeed

  

January 3, 2021

Xorax Family Trust

 

   Date

/s/ Zachary Dutton

  

January 3, 2021

Zachary Dutton

 

   Date


SCHEDULE “A”

INFORMATION FOR PROPOSED DIRECTORS

Nitin Kaushal

Age: 55

Business/Residential Address:

48 Frybrook Crescent,

Richmond Hill, Ontario L4B 4B9

Summary of Qualifications:

Mr. Kaushal is President of Anik Capital Corp. In February 2020, he retired from PwC Canada where he was a Managing Director in their Corporate Finance Practice focused on the pharmaceutical/healthcare space. He had worked at PwC Canada since 2012. Mr. Kaushal has over 30 years of experience in the healthcare, financial services industry focusing on the biotechnology, medical devices and healthcare services markets. He was a Managing Director of leading healthcare investment banking teams at a number of Canadian investment banks including Desjardins Securities Inc., Orion Securities Inc., Vengate Capital, HSBC Securities Inc. and Gordon Capital. He has been involved in over 50 M&A, strategic advisory and licensing assignments for a range of companies from early stage biotechs to large pharmas. He has participated in capital market transactions ranging from private placements to IPO’s to bought deal underwritings in excess of $2B and has been a speaker at leading biotech conferences including BIO and BioFinance. His entry into the biotech/healthcare space was in 1991 with MDS Capital Corp., a leading healthcare venture capital firm. Mr. Kaushal sits on a number of public and private company boards in the biotech and healthcare space and has a BSc in Chemistry from the University of Toronto and is a Chartered Professional Accountant. Mr. Kaushal does not hold any shares of FSD Pharma Inc. and does not have any material interest in any transactions involving FSD Pharma Inc.

Larry Latowsky

Age: 61

Business address:

223 Riviera Drive

Markham, Ontario

L3R 5J6

Residential Address:

269 John West Way

Aurora, Ontario L4G 0S8

Summary of Qualifications:

Mr. Latowsky is currently CEO of Canntab Therapeutics Ltd., an innovator in cannabinoid and terpene blends in hard pill form for therapeutic application. Mr. Latowsky has held a number of leadership positions throughout his career including being Chairman and CEO of Top Drug Corp over the past five years and working as President and CEO of Katz Group Canada overseeing the largest network of pharmacy retailers in Canada operating as Rexall, Pharmaplus, IDA and Guardian Drugstores. Mr. Latowsky also led Propharm Technology and DC Labs a vertical manufacturing and packaging division of pharmaceuticals and over the counter drug store product. Mr. Latowsky, a graduate of the University of Toronto Rotman Business School and Institute of Corporate Directors of Canada program, has served on many profit and non-profit Boards including being Chairman of the Board for Well.ca, one of Canada’s leading E-commerce companies. Mr. Latowsky’s experience is a unique blend of traditional retail bricks and mortar, distribution, manufacturing and e-commerce/internet-based marketing and sales. Mr. Latowsky does not hold any shares of FSD Pharma Inc. and does not have any personal material interest in any transactions involving FSD Pharma Inc. Prior to Mr. Latowsky becoming CEO of Canntab Therapeutics Ltd., Canntab Therapeutics Ltd. entered into agreements with FSD Pharma Inc. and FV Pharma Inc. relating to the supply of cannabis products to Canntab Therapeutics Ltd. by FSD Pharma Inc. and the use of certain facilities constructed by FSD Pharma Inc., in Cobourg, Ontario.


Fernando Cugliari

Age: 45

Business Address:

25 Main Street, 3rd Floor

George Town, Grand Cayman

Cayman Islands PO Box 68

Residential Address:

126 Sardinia Close,

Crystal Harbour, Grand Cayman

Cayman Islands

Summary of Qualifications:

Mr. Cugliari has over 20 years of experience in finance and law, and is an attorney qualified to practice in Ontario and the Cayman Islands. Mr. Cugliari is currently an International Investment Advisor at CIBC FirstCaribbean International Bank, where he provides comprehensive investment advisory services to high and ultra-high-net-worth individuals and their families, as well as insurance, corporate, institutional and pension fund clients. Over the past five years, Mr. Cugliari worked as the Head of the Private Client and Private Equity Group at Etienne Blake Attorneys at Law, a law firm in the Cayman Islands, and as General Counsel and Chief Operating Officer for FasPay Global, an international financial and payments technology company. He previously held senior positions in law firms in Ontario. Mr. Cugliari does not hold any shares of FSD Pharma Inc. and does not have any material interest in any transactions involving FSD Pharma Inc.

EX-99.14 15 d147583dex9914.htm EX-99.14 EX-99.14

Exhibit 14

FSD PHARMA INC.

FORM OF

STOCK OPTION PLAN - OPTION CERTIFICATE

This Option Certificate is issued pursuant to the provisions of the Stock Option Plan (the “Plan”) of FSD Pharma Inc. (the “Company”) and evidences that [         ] is the holder (the “Option Holder”) of an option (the “Option”) to purchase up to [         ] class B subordinate voting shares (the “Shares”) in the capital stock of the Company at a purchase price of Cdn.$[         ] per Share (the “Exercise Price”). This Option may be exercised at any time and from time to time from and including [         ], 20[         ] (the “Grant Date”) through to and including up to 4:00 p.m. local time in Toronto, Ontario (the “Expiry Time”) on [        ], 20[         ] (the “Expiry Date”). The Option vests immediately.

In the event that the Option Holder holds his or her Option as a director and such Option Holder ceases to hold such position other than by reason of death or Disability, the Expiry Date of the Option shall be, unless otherwise determined by the Committee and expressly provided for herein, the 30th day following the date the Option Holder ceases to hold such position unless the Option Holder ceases to hold such position as a result of:

i. ceasing to meet the qualifications set forth in the corporate legislation applicable to the Company;

ii. a special resolution having been passed by the shareholders of the Company removing the Option Holder as a director of the Company or any Subsidiary; or

iii. an order made by any Regulatory Authority having jurisdiction to so order,

in which case the Expiry Date shall be the date the Option Holder ceases to hold such position.

To exercise this Option, the Option Holder must deliver to the Company, prior to the Expiry Time on the Expiry Date, an Exercise Notice, in the form provided in the Plan or as may be required by the Company from time to time, together with the original of this Option Certificate and a certified cheque or bank draft payable to the Company or its legal counsel in an amount equal to the aggregate of the Exercise Price of the Shares in respect of which this Option is being exercised.

If the Company determines that under the requirements of applicable taxation laws it is obliged to withhold for remittance to a taxing authority any amount as a condition of the issuance of any Shares pursuant to the Option, the Company may, prior to and as a condition of issuing the Shares, require the Option Holder to pay to the Company such amount as the Company is obliged to remit to such taxing authority in respect of the issuance of the Shares.

This Option Certificate and the Option evidenced hereby is not assignable, transferable or negotiable and is subject to the detailed terms and conditions contained in the Plan, which is incorporated by reference herein. This Option Certificate is issued for convenience only and in the case of any dispute with regard to any matter in respect hereof, the provisions of the Plan and the records of the Company shall prevail. This Option is also subject to the terms and conditions contained in the schedules, if any, attached hereto. Any capitalized term used herein but not defined shall have the meaning ascribed to such term in the Plan.


FSD PHARMA INC. by its authorized signatory:

 

             

The Option Holder hereby accepts this Option subject to all of the terms and conditions of the Plan. The Option Holder agrees to execute, deliver, file and otherwise assist the Company in filing any report, undertaking or document with respect to the awarding of the Option and exercise of the Option, as may be required by regulatory authorities.

This Option Certificate is effective as of the Grant Date, and reflects the consolidation of the Company’s Shares effective on [         ], 20[         ].

By signing this Option Certificate, the Option Holder acknowledges that the Option granted to the Option Holder as evidenced by this Option Certificate is effective as of the date of the grant and that the Option Holder was advised of terms of the Option on or about the date of grant.

Signature of Option Holder:

 

             

     

             

Signature       Date signed:

                 

     
Print Name      

             

     
Address      


FSD PHARMA INC. STOCK OPTION PLAN

NOTICE OF EXERCISE OF OPTION

 

TO:

Bennett Jones LLP Attn: Aaron Sonshine

3400 One First Canadian Place

P.O. Box 130 Toronto, ON M5X 1A4

(or such other address as the Company may advise)

The undersigned hereby irrevocably gives notice, pursuant to the Stock Option Plan (the “Plan”) of FSD Pharma Inc. (the “Company”), of the exercise of the Option to acquire and hereby subscribes for (cross out inapplicable item):

(a) all of the Shares; or

(b) _____________ of the Shares;

which are the subject of the Option Certificate attached hereto (attach your original Option Certificate). The undersigned tenders herewith a certified cheque, bank draft or wire transfer (circle one) payable to the Company in an amount equal to the aggregate Exercise Price of the aforesaid Shares and directs the Company to issue a certificate OR a written notice in the case of uncertificated Shares evidencing said Shares in the name of the undersigned to be issued to the undersigned [in the case of issuance of a share certificate, at the following address (provide full complete address)]:

The undersigned acknowledges the Option is not validly exercised unless this Notice is completed in strict compliance with this form and delivered to the required address with the required payment prior to the Expiry Time on the Expiry Date of the Option.

DATED the day         of                , 20         .

 

             

Signature of Option Holder
EX-99.15 16 d147583dex9915.htm EX-99.15 EX-99.15

Exhibit 15

UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE THE DATE THAT IS 4 MONTHS AND A DAY AFTER THE LATER OF (I) SEPTEMBER 15, 2017 AND (II) THE DATE THE ISSUER BECAME A REPORTING ISSUER IN ANY PROVINCE OR TERRITORY.

EXERCISABLE PRIOR TO 5:00 P.M., TORONTO TIME, ON THE EXPIRY DATE (AS DEFINED BELOW) AT WHICH TIME THESE WARRANTS SHALL EXPIRE AND BE NULL AND VOID.

WARRANTS TO PURCHASE CLASS “B” COMMON NON-VOTING SHARES

OF

FV PHARMA INC.

(Incorporated under the laws of the Province of Ontario)

 

CERTIFICATE NO. Special Warrant-2       Number of warrants represented
      by this certificate: 40,000,000

DATE: September 15, 2017 (the “Closing Date” or “Issuance Date”)

THIS CERTIFIES that, for value received, Anthony Durkacz, 2045 Lakeshore Blvd. W., Toronto, Ontario M8V 2Z6 (the “Holder”), is the registered holder of 40,000,000 warrants (the “Warrants”) each of which entitles the Holder, subject to the terms and conditions set forth in this Warrant Certificate, to purchase from FV Pharma Inc. (the “Company”), one fully paid and non-assessable Class “B” Common Non-Voting Share of the Company. Each Warrant will, subject to adjustment, entitle the holder thereof to acquire one fully paid and non-assessable Class “B” Common Non-Voting Shares of the Company (hereinafter a “Share” or “Shares”), at any time up to 5:00 p.m. (Toronto time) on the day which is five (5) years from the Closing Date (as defined herein) (the “Expiry Date”) on payment of $0.05 per Share (the “Exercise Price”). The number of Shares which the Holder is entitled to acquire upon exercise of the Warrants and the Exercise Price are subject to adjustment as hereinafter provided.

Exercise of Warrants

 

1.

Election to Purchase. The rights evidenced by this Warrant Certificate may be exercised by the Holder in whole or in part and in accordance with the provisions hereof by delivery of an Election to Purchase in substantially the form attached hereto as Schedule “A”, properly completed and executed, together with payment of the Exercise Price by bank draft or wire transfer to the account of the counsel for the Company or bank draft, wire transfer or certified cheque payable to or to the order of the Company in the amount of the Exercise Price multiplied by the number of Shares specified in the Election to Purchase at the registered office of the Company, or such other address in Canada as the Holder may be notified of in writing by the Company. In the event that the rights evidenced by this certificate are exercised in part, the Company shall, contemporaneously with the issuance of the Shares issuable on the exercise of the Warrants so exercised, issue to the Holder a Warrant Certificate on identical terms in respect of that number of Shares in respect of which the Holder has not exercised the rights evidenced by this certificate.

 

2.

Exercise. The Company shall, as promptly as practicable after it receives a duly executed Election to Purchase and funds equal to the Exercise Price by bank draft or certified cheque payable to or to the order of the Company for the number of Shares specified in the Election to Purchase (the “Exercise Date”), issue that number of Shares specified in the Election to Purchase.


3.

Share Certificates. As promptly as practicable after the Exercise Date, the Company shall issue and deliver to the Holder, registered in such name or names as the Holder may direct or if no such direction has been given, in the name of the Holder, a certificate or certificates for the number of Shares specified in the Election to Purchase. To the extent permitted by law, such exercise shall be deemed to have been effected as of the close of business on the Exercise Date, and at such time the rights of the Holder with respect to the number of Warrants which have been exercised as such shall cease, and the person or persons in whose name or names any certificate or certificates for Shares shall then be issuable upon such exercise shall be deemed to have become the holder or holders of record of such underlying Shares represented thereby.

 

4.

Fractional Shares. No fractional Shares shall be issued upon exercise of any Warrants and no payments or adjustment shall be made upon any exercise on account of any cash dividends on the Shares issued upon such exercise. No fractional Warrants shall be issued, in the event that fractional Warrants would be issued the Company has the right to round the fractional Warrants at the Company’s discretion to the nearest whole Warrant.

 

5.

Consolidation and Amalgamation.

 

  (a)

The Company shall not enter into any transaction whereby all or substantially all of its undertaking, property and assets would become the property of any other corporation (herein called a “successor corporation”) whether by way of reorganization, reconstruction, consolidation, amalgamation, merger, arrangement, business combination, share exchange, transfer, sale, disposition or otherwise, unless prior to or contemporaneously with the consummation of such transaction the Company and the successor corporation shall have executed such instruments and done such things as, in the opinion of counsel to the Company, are necessary or advisable to establish that upon the consummation of such transaction:

 

  (i)

the successor corporation will have assumed all the covenants and obligations of the Company under this Warrant Certificate; and

 

  (ii)

the Warrant will be a valid and binding obligation of the successor corporation entitling the Holder, as against the successor corporation, to all the rights of the Holder under this Warrant Certificate.

 

  (b)

Whenever the conditions of subsection 1(a) shall have been duly observed and performed the successor corporation shall possess, and from time to time may exercise, each and every right and power of the Company under this Warrant Certificate in the name of the Company or otherwise and any act or proceeding by any provision hereof required to be done or performed by any director or officer of the Company may be done and performed with like force and effect by the like directors or officers of the successor corporation.

 

6.

Adjustment to Exercise Price. The Exercise Price in effect at any time is subject to adjustment from time to time in the events and in the manner provided if and whenever at any time after the Issuance Date and prior to the Expiry Date, the Corporation subdivides or changes its outstanding Shares into a greater number of shares (a “Share Reorganization”), then the Exercise Price will be adjusted effective immediately after the effective date of any such event, by multiplying the Exercise Price in effect immediately prior to such effective date, by a fraction, the numerator of which is the number of Shares outstanding on such effective date before giving effect to such Share Reorganization and the denominator of which is the number of Shares outstanding immediately after giving effect to such Share Reorganization.

 

- 2 -


7.

Rules Regarding Calculation of Adjustment of Exercise Price

 

  (a)

The adjustments provided for in Section 6 are cumulative and will, in the case of any adjustment to the Exercise Price, be computed to the nearest one-tenth of one cent and will be made successively whenever an event referred to therein occurs, subject to the following subsections of this Section 7.

 

  (b)

No adjustment in the Exercise Price is required to be made unless such adjustment would result in a change of at least 1% in the prevailing Exercise Price; provided, however, that any adjustments which, except for the provisions of this subsection, would otherwise have been required to be made, will be carried forward and taken into account in any subsequent adjustments.

 

  (c)

As a condition precedent to the taking of any action which would require any adjustment to the Warrants, including the Exercise Price, the Company will take any corporate action which may, in the opinion of counsel to the Company, be necessary in order that the Company, or any successor to the Company or successor to the undertaking or assets of the Company, will be obligated to and may validly and legally issue as fully paid and non-assessable all of the Shares or other securities which the Holder is entitled to receive on the exercise hereof in accordance with the provisions hereof.

 

8.

Other Notices. In case at any time after the Closing Date and prior to the Expiry Date: (a) the Company shall declare any dividend upon its shares payable in Shares;

 

  (b)

the Company shall offer for subscription pro rata to the holders of its Shares any additional shares of any class or other rights, options or warrants;

 

  (c)

there shall be any capital reorganization or reclassification of the capital stock of the Company, or consolidation, amalgamation or merger of the Company with, or sale of all or substantially all of its assets to, another corporation; or

 

  (d)

there shall be a voluntary or involuntary dissolution, liquidation or winding-up of the Company,

then, in any one or more of such cases, the Company shall give to the Holder (A) at least 10 days’ prior written notice of the date on which a record date shall be taken for such dividend, distribution or subscription rights or for determining rights to vote in respect of any such reorganization, reclassification, consolidation, merger, amalgamation, sale, dissolution, liquidation or winding-up and (B) in the case of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding-up, at least 10 days’ prior written notice of the date when the same shall take place. Such notice in accordance with the foregoing clause (A) shall also specify, in the case of any such dividend, distribution or subscription rights, the date on which the holders of shares shall be entitled thereto, and such notice in accordance with the foregoing clause (B) shall also specify the date on which the holders of shares shall be entitled to exchange their shares for securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, amalgamation, sale, dissolution, liquidation or winding-up, as the case may be.

 

- 3 -


9.

Shares to be Reserved. The Company will at all times keep available, and reserve if necessary, out of its authorized shares, solely for the purpose of issue upon the exercise of the Warrants, such number of Shares as shall then be issuable upon the exercise of the Warrants. The Company covenants and agrees that all Shares which shall be so issuable will, upon issuance, be duly authorized and issued as fully paid and non-assessable. The Company will take all such actions as may be necessary to ensure that all such Shares may be so issued without violation of any applicable requirements of any exchange upon which the shares of the Company may be listed or in respect of which the Shares are qualified for unlisted trading privileges. The Company will take all such actions as are within its power to ensure that all such Shares may be so issued without violation of any applicable law.

 

10.

Issue Tax. The issuance of certificates for Shares upon the exercise of Warrants shall be made without charge to the Holder for any issuance tax in respect thereto, provided that the Company shall not be required to pay any tax which may be payable in respect of any transfer involved in the issuance and delivery of any certificate in a name other than that of the Holder.

 

11.

Listing. In the event the shares of the Company are listed on any stock exchange, the Company will, at its expense and as expeditiously as possible, use its commercially reasonable efforts to cause all Shares issuable upon the exercise of the Warrants to be duly listed on such stock exchange prior to the issuance of such Shares.

 

12.

Fair Market Value. For the purposes of any computation hereunder, the “Fair Market Value” at any date shall be the weighted average sale price per share for the shares of the Company for the 20 consecutive trading days immediately before such date on the stock exchange on which the shares of the Company may then be listed, or, if the shares or any other security in respect of which a determination of Fair Market Value is being made are not listed on any stock exchange, the Fair Market Value shall be determined by the directors, which determination shall be conclusive. The weighted average price shall be determined by dividing the aggregate sale price of all such shares sold on the said exchange during the said 20 consecutive trading days by the total number of such shares so sold.

Replacement

Upon receipt of evidence satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant Certificate and, if requested by the Company, upon delivery of a bond of indemnity satisfactory to the Company (or, in the case of mutilation, upon surrender of this Warrant Certificate), the Company will issue to the Holder a replacement certificate containing the same terms and conditions as this Warrant Certificate.

Expiry Date

The Warrants shall expire and all rights to purchase Shares hereunder shall cease and become null and void at 5:00 p.m. (Toronto time) on the day which is five (5) years from the Closing Date.

Inability to Deliver Securities

If for any reason, other than the failure or default of the Holder, the Company is unable to issue and deliver the Shares or other securities as contemplated herein to the Holder upon the proper exercise by the Holder of the right to purchase any of the securities covered by this Warrant Certificate, the Company may pay, at its option and in complete satisfaction of its obligations hereunder, to the Holder, in cash, an amount equal to the difference between the Exercise Price and the Fair Market Value of such Shares or other securities on the Exercise Date.

 

- 4 -


Resale Restrictions, Legending of Certificates

Any securities issued upon exercise of these Warrants before the date that is four months and a day after the later of (i) September 15, 2017, and (ii) the date the Company became a reporting issuer in any province or territory, shall bear the following legend:

UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE THE DATE THAT IS 4 MONTHS AND A DAY AFTER THE LATER OF (I) SEPTEMBER 15, 2017, AND (II) THE DATE THE ISSUER BECAME A REPORTING ISSUER IN ANY PROVINCE OR TERRITORY.

Governing Law

The laws of the Province of Ontario and the laws of Canada applicable therein shall govern this Warrant Certificate.

Successors

This Warrant Certificate shall enure to the benefit of and shall be binding upon the Holder and the Company and their respective successors.

Assignment and Transfer

This Warrant Certificate is non-transferable and the Holder may not assign this Warrant Certificate or any right, benefit or interest herein.

Counterparts

This Warrant Certificate may be executed in any number of counterparts with the same effect as if all parties had signed the same document. All counterparts shall be construed together, and shall constitute one and the same Warrant Certificate. A facsimile counterpart of this Warrant Certificate shall be fully effective for all purposes.

[Signature page follows.]

 

- 5 -


SCHEDULE “A”

ELECTION TO PURCHASE

Capitalized terms used herein have the meanings ascribed thereto in the warrant certificate (the “Warrant Certificate”) attached hereto.

The undersigned Holder hereby irrevocably elects to exercise the Warrants granted by the Company pursuant to the Warrant Certificate for the number of Shares (or other property or securities contemplated in the Warrant Certificate) as set forth below:

 

(a)   Number of Shares to be acquired

                             

(b)   Subscription Price (per Share)

   $                        

(c)   Aggregate Subscription Price

   $                        

The Holder hereby tenders a certified cheque, bank draft or cash for such aggregate Subscription Price and directs the Shares to be registered and certificates therefor to be issued as directed below.

The undersigned hereby certifies that the undersigned (i) is not (and is not exercising the Warrants for the account or benefit of) a “U.S. Person”, (ii) did not execute or deliver this exercise form in the United States and (iii) has in all other aspects complied with the terms of Regulation S of the United States Securities Act of 1933, as amended the (“1933 Act”) or any successor rule or regulation of the United States Securities and Exchange Commission in effect. Alternatively, the undersigned is tendering with this exercise form a written opinion of counsel to the effect that the securities to be delivered upon exercise of the Warrants have been registered under the 1933 Act and the securities laws of all applicable states of the United States or are exempt from registration thereunder. The term “U.S. Person” is as defined in Regulation S under the 1933 Act and includes, but is not limited to, any natural person resident in the United States and any partnership or corporation organized or incorporated under the laws of the United States. “United States” means the United States of America, its territories and possessions, any state of the United States and the District of Columbia.

 

Direction as to Registration  
Name of Registered Holder:  

             

Address of Registered Holder:  

             

 

PLEASE CHECK THIS BOX IF THE CERTIFICATES REPRESENTING THESE SECURITIES ARE TO BE DELIVERED AT THE OFFICE OF THE COMPANY, FAILING WHICH THE CERTIFICATES WILL BE MAILED TO THE ADDRESS(ES) SET FORTH ABOVE.

DATED this _____ day of                                     ,                 .

 

             

    Per:  

             

Signature Guaranteed*      
    Name:  

             

    Title:  

             

 

*

The signature of the registered holder must be guaranteed by a Canadian chartered bank, Medallion Guarantee or other entity acceptable to the Trustee, if the Direction as to the Registration is in the name of anything other than the registered holder of the Warrant Certificate

EX-99.16 17 d147583dex9916.htm EX-99.16 EX-99.16

Exhibit 16

BY SEDAR

January 27, 2021

Ontario Securities Commission

Alberta Securities Commission

British Columbia Securities Commission

Manitoba Securities Commission

New Brunswick Securities Commission

Newfoundland Securities Commission

Nova Scotia Securities Commission

Prince Edward Island Securities Office

Financial and Consumer Affairs Authority

(Saskatchewan)

Canadian Securities Exchange (via email)

Nasdaq (via email)

 

RE:

FSD Pharma Inc. (the “Corporation”)

Notice of Meeting and Record Date

We hereby provide the following information with respect to a shareholder requisitioned Special Meeting of shareholders of the Corporation pursuant to Section 2.2 of NI 54-101Communication with the Beneficial Owners of Securities of a Reporting Issuer and confirm that notice of the record date and meeting dates was sent to CDS:

 

Name of Reporting Issuer    FSD Pharma Inc.
Meeting Type    Special - Dissenting
ISIN No.    CLASS B SUBORDINATE VOTING
   CA35954B2066
   CLASS A MULTIPLE VOTING SHARES
   CARFYQMV2181
CUSIP No.    CLASS B SUBORDINATE VOTING
   35954B206
   CLASS A MULTIPLE VOTING SHARES
   RFYQMV218
Meeting Date    March 31, 2021
Record Date for Notice    March 1, 2021
Record Date for Voting    March 1, 2021
Beneficial Ownership Determination Date    March 1, 2021
Class of Securities Entitled to Receive Notice    Common, Multiple Voting Shares
Class of Securities Entitled to Vote    Common, Multiple Voting Shares

On January 4, 2021, Anthony Durkacz and Zeeshan Saeed, representing a group of concerned shareholders (the “Requisitioning Shareholder Representatives”) which hold in excess of 5% of the issued and outstanding shares of the Corporation, sent to the Corporation a requisition of a meeting of shareholders of the Corporation pursuant to Section 105 of the Business Corporations Act (Ontario). The directors of the Corporation have not, within 21 days after the date on which the requisition was received by the Corporation, sent notice of a general meeting to each shareholder and each director of the Corporation.

Accordingly, this notice is being given by the Requisitioning Shareholders, on behalf of the Corporation, pursuant to Section 105 of the Business Corporations Act (Ontario).

 

“Anthony Durkacz”       “Zeeshan Saeed”

             

     

             

Anthony Durkacz       Zeeshan Saeed
Requisitioning Shareholder Representative of FSD       Requisitioning Shareholder Representative of FSD
Pharma Inc.       Pharma Inc.
EX-99.17 18 d147583dex9917.htm EX-99.17 EX-99.17

Exhibit 17

FSD Shareholders Seek Prompt Shareholder Meeting

To Address Ongoing Board and Management Failures

Toronto, Ontario, January 27, 2021 / Newsfile / – In order to protect against the further erosion of shareholder value, a group of shareholders (the “Concerned Shareholders”) of FSD Pharma Inc. (Nasdaq: HUGE) (CSE:HUGE) (FRA:0K9) (the “Company”), including two directors, Anthony Durkacz and Zeeshan Saeed, have called a special meeting of the Company’s shareholders to be held on March 31, 2021.

As acknowledged by the Company in its January 22, 2021 and January 26, 2021 press releases, on January 4, 2021, shareholders holding more than five percent of the issued shares of the Company carrying the right to vote at a shareholders’ meeting requisitioned the Company’s directors to call a special meeting of shareholders to be held not later than March 15, 2021. The purpose of the requisitioned meeting is to replace all of the members of the Company’s board of directors other than Messrs. Durkacz and Saeed. The additional nominees to the Company’s board of directors are Messrs. Larry Latowsky, Fernando Cugliari and Nitin Kaushal, all of whom are well-qualified to serve in this capacity. Additional details about the background and extensive qualifications of these nominees will be provided to shareholders in an information circular prior to the meeting.

In response, the Company’s board of directors (other than Messrs. Durkacz and Saeed) has attempted to frustrate the fundamental rights of shareholders to requisition a meeting, by scheduling a meeting to be held nearly six months after the date of the requisition. The board’s delay in holding a meeting is a transparent attempt to prevent shareholders from exercising their statutory right to a timely meeting to consider replacement of the current board members. The Company’s board is simply trying to frustrate shareholder democracy and deny shareholders their statutory rights.

The Concerned Shareholders are seeking to address the Company’s dramatic decline and the staggering loss of shareholder value. Since February 6, 2019, the date of the appointment of Dr. Raza Bokhari as the Company’s Chief Executive Officer, the Company’s share price has dropped from C$67.33 to C$2.50 as of the close of business today. This decline of over 95% has resulted in the loss of over C$400 million in shareholder value. The Concerned Shareholders believe that change is urgently needed to address this situation, as the Company’s management and board of directors have failed to develop an effective strategy for reversing the Company’s decline.

In the past weeks, Dr. Bokhari has disregarded numerous requests from the Concerned Shareholders for access to corporate records. Those requests were made in order to investigate apparent irregularities in the Company’s governance that have come to the attention of the Concerned Shareholders. For its part, the Company’s board of directors has failed to respond to two separate requests for board meetings submitted by Messrs. Durkacz and Saeed. Instead, Dr. Bokhari has sought to wrongfully terminate Mr, Saeed’s employment as the Company’s President. The Concerned Shareholders have also been informed that at the Company’s most recent board meeting, the directors (other than Messrs. Durkacz and Saeed) authorized a large increase in their annual compensation that is wholly inconsistent with the Company’s circumstances, performance and the loss of shareholder value during their tenure. This compensation increase was not disclosed in the Company’s January 26, 2021 press release.

The Company did not hold a shareholder meeting in 2020. Under its governing statute, the Business Corporations Act (Ontario), the Company is required to hold its next annual meeting of shareholders by not later than March 16, 2021. This obligation was taken into account by the Concerned Shareholders in the meeting date stated in the requisition. Rather than hold a timely meeting to enable shareholders to exercise their fundamental rights, however, the board has sought to delay as long as possible the date for a meeting. This delay frustrates shareholder democracy and denies shareholders their statutory rights, while the Company continues to decline.

In light of the Company’s dire circumstances and continued deterioration, its ineffective management, and recent actions by the Company’s board of directors, urgent action is not only justified but necessary. The Concerned Shareholders have taken action to prevent the further destruction of value and enable the Company’s shareholders to determine its future direction by calling a special meeting of the Company’s shareholders to be held on March 31, 2021. Further details regarding the meeting will be provided to shareholders in advance of the meeting.


Sources: Anthony Durkacz and Zeeshan Saeed

For additional information, please contact:

Anthony Durkacz

ConcernedFSDshareholders@gmail.com

Forward Looking Information

Certain statement contained herein are “forward-looking statements”. Often, but not always, forward-looking statement can be identified by the use of words such as “plans”, “expects”, “expected”, “scheduled”, “estimates”, “intends”, “anticipates” or “believes”, or variations of such words and phrases, or states that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. The Concerned Shareholders cannot give any assurance that such forward-looking statements will prove to have been correct. The reader is cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this document.

EX-99.18 19 d147583dex9918.htm EX-99.18 EX-99.18

Exhibit 18

Court Orders FSD Pharma to Move Shareholder Meeting Date to May 14, 2021,

Imposes Requirement of an Independent Meeting Chair and

Prevents Dr. Raza Bokhari and Other Directors from Voting Recently Issued Shares

Toronto, Ontario, March 8, 2021 / Newsfile / – The group of concerned shareholders (the “Concerned Shareholders”) of FSD Pharma Inc. (Nasdaq: HUGE) (CSE:HUGE) (FRA:0K9) (the “Company” or “FSD”) which includes two founding directors, Anthony Durkacz and Zeeshan Saeed, are pleased to announce that they were successful in their request that the Ontario Superior Court of Justice (Commercial List) (the “Court”) order the Company to accelerate the date of its previously called annual shareholders’ meeting.

The meeting will now be held on May 14, 2021. As a result of this earlier meeting date, the special meeting of the Company’s shareholders called by the Concerned Shareholders for March 31, 2021 will not be required. This earlier meeting date will allow FSD to deal with the issues raised by the Concerned Shareholders while finally satisfying FSD’s obligation to hold its long-overdue annual shareholders’ meeting – an outcome that is in the best interest of all FSD shareholders.

As requested by the Concerned Shareholders, the Court also ordered that Dr. Raza Bokhari, the Chair of FSD’s board of directors (the “Board”) and the Company’s Chief Executive Officer, not act as chair of the meeting. Instead, an independent person will be appointed to ensure that the meeting is run in a fair and orderly fashion.

The Concerned Shareholders have identified many actions by Dr. Raza Bokhari and other board members, Stephen Buyer, Robert Ciaruffoli, James Datin, Gerald Goldberg and Larry Kaiser, that have harmed shareholders. Among these is the issuance of at least 13,196,764 of Class B shares in just seven weeks – over 68% of the number outstanding on January 4, 2021, the date of the Concerned Shareholders’ requisition of a shareholder meeting (the “Requisition Date”). These entirely unjustified issuances at a time when the Class B shares were already devalued have driven the share price to all-time lows and compounded shareholder losses.

During this time, Dr. Raza Bokhari, Stephen Buyer, Robert Ciaruffoli, James Datin, Gerald Goldberg and Larry Kaiser, have lined their pockets by awarding themselves cash and Class B shares for services yet to be provided. The value of the 1,173,709 Class B shares issued to Dr. Raza Bokhari on February 10, 2021 was at least $5.7 million, based on the closing price on that day. Board members Stephen Buyer, Robert Ciaruffoli, James Datin, Gerald Goldberg and Larry Kaiser awarded themselves compensation in the form of cash and Class B shares equal to nearly $1 million. Compensation on this scale for serving a company the size of FSD, at a time when its shares are trading at all-time lows and stock markets are at all-time highs, is unconscionable.

As suggested by the Concerned Shareholders during the course of the hearing, the Court ordered that the votes attached to shares issued since the Requisition Date to Dr. Raza Bokhari, Stephen Buyer, Robert Ciaruffoli, James Datin, Gerald Goldberg and Larry Kaiser and any entities related to any of them not be counted at the upcoming meeting.

The Concerned Shareholders are relieved by the Court’s decision as it will help ensure that the many issues arising from the misconduct of Dr. Raza Bokhari and the members of the Board that have enabled him, Stephen Buyer, Robert Ciaruffoli, James Datin, Gerald Goldberg and Larry Kaiser, are addressed by the Company’s shareholders expeditiously.

At the meeting, Shareholders will have the opportunity to determine FSD’s future by voting to replace Dr. Raza Bokhari, Stephen Buyer, Robert Ciaruffoli, James Datin, Gerald Goldberg and Larry Kaiser with three new, highly qualified directors having a depth of relevant experience in the biotechnology and pharmaceutical industries. These new directors have strong track records of integrity and success and will bring to FSD a wealth of critical experience in the areas of public company governance, accounting, finance, capital markets and law.


Details about the new directors proposed by the Concerned Shareholders are provided below:

Mr. Nitin Kaushal is a finance executive with over 30 years of experience in the healthcare and the financial services industries, focusing on the biotechnology, medical device and healthcare services markets, including significant experience with corporate governance and acting on the boards of public companies. Mr. Kaushal is currently the President of Anik Capital Corp. and until his retirement in 2020, was a Managing Director in the corporate finance practice at PricewaterhouseCoopers.

Mr. Lawrence Latowsky is an executive with extensive experience in the pharmaceutical industry. Mr. Latowsky currently serves as the Chief Executive Officer of Canntab Therapeutics Ltd. Until 2020, he was the Chairman and Chief Executive Officer of Top Drug Corp. and, prior to that, he served as President and CEO of Katz Group Canada, overseeing the largest network of pharmacy retailers in Canada operating as Rexall, Pharmaplus, IDA and Guardian Drugstores.

Mr. Fernando Cugliari has over 20 years of experience in finance and law. Mr. Cugliari is currently an International Investment Advisor at CIBC FirstCaribbean International Bank, where he provides comprehensive investment advisory services to high and ultra-high-net-worth individuals and their families, as well as insurance, corporate, institutional and pension fund clients.

The Concerned Shareholders are extremely pleased that these highly qualified individuals have stepped forward to help restore FSD.

The Concerned Shareholders will be issuing an information circular providing more details regarding the director nominees, their plans for the Company, the meeting and how shareholders can make their vote count for change. It is important for the Company’s shareholders to read this information circular carefully and vote at the meeting. More information will be available at the website established by the Concerned Shareholders: http://www.restorefsd.com/.

For additional information, please contact:

Christine Carson

President & CEO

Carson Proxy Advisors Ltd.

christine@carsonproxy.com

416-804-0825

Forward Looking Information

Certain statement contained herein are “forward-looking statements”. Often, but not always, forward-looking statement can be identified by the use of words such as “plans”, “expects”, “expected”, “scheduled”, “estimates”, “intends”, “anticipates” or “believes”, or variations of such words and phrases, or states that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. Forward-looking statements contained in this press release include statements regarding the meeting and the information circular to be issued. The Concerned Shareholders cannot give any assurance that such forward-looking statements will prove to have been correct. The reader is cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this document.

EX-99.19 20 d147583dex9919.htm EX-99.19 EX-99.19

Exhibit 19

SOLICITATION BY AND ON BEHALF OF

THE CONCERNED SHAREHOLDERS OF

FSD PHARMA INC.

ANTHONY DURKACZ, ZEESHAN SAEED, FIRST REPUBLIC CAPITAL CORP., ANDREW DURKACZ, GLORIA DURKACZ, FORTIUS RESEARCH AND TRADING CORP., XORAX FAMILY TRUST AND ZACHARY DUTTON

FOR THE SUPPORT OF THE HOLDERS OF

CLASS B SUBORDINATE VOTING SHARES OF

FSD PHARMA INC.

AT THE ANNUAL AND SPECIAL MEETING OF

FSD PHARMA INC.

TO BE HELD ON MAY 14, 2021

This information circular, including any supplements hereto or amendments and restatements hereof (together, the “Circular”), prepared by Anthony Durkacz, Zeeshan Saeed, First Republic Capital Corp. (“First Republic”), Andrew Durkacz, Gloria Durkacz, Fortius Research and Trading Corp. (“Fortius”), Xorax Family Trust (“Xorax”) and Zachary Dutton (together, the “Concerned Shareholders”, “we” or “our”), solicit your SUPPORT for a change in the board of directors (the “Board”) of FSD Pharma Inc. (“FSD” or the “Company”).

In compliance with the solicitation requirements under applicable Canadian corporate and securities laws, the Concerned Shareholders have prepared and filed this Circular so that they may have discussions with holders of class B subordinate voting shares (“Class B Shares”) regarding the Concerned Shareholders’ nominees for election to the Board. The Concerned Shareholders are not asking holders of Class B Shares to send a form of proxy at this time.

 

The Concerned Shareholders are soliciting your support and, ultimately, intend to solicit forms of proxy in support of the election at FSD’s annual general and special meeting of holders (“Shareholders”) of Class B Shares and class A multiple voting shares (“Class A Shares” and, together with Class B Shares, “Shares”) to be held on May 14, 2021, and at any and all adjournments or postponements of such meeting (the “Meeting”), of the following nominees as directors of FSD: Anthony Durkacz, Zeeshan Saeed, Nitin Kaushal, Lawrence Latowsky and Fernando Cugliari. Further details concerning our proposed nominees are contained in this Circular.

We expect to issue a supplement to or amendment and restatement of this Circular (the “Final Concerned Shareholders’ Circular”) containing details of the Meeting and instructions with regard to the completion and return of proxies and voting instruction forms to be provided by the Concerned Shareholders for use at the Meeting. WE URGE SHAREHOLDERS TO MONITOR AND REVIEW OUR PRESS RELEASES AND OTHER FILINGS FOR FURTHER INFORMATION, INCLUDING THE FINAL CONCERNED SHAREHOLDERS’ CIRCULAR, AS IT BECOMES AVAILABLE.

Stay up-to-date by following us at: www.RestoreFSD.com; Facebook: RestoreFSD; and Twitter: @RestoreFSD.

March 17, 2021


Any questions and requests for assistance may be directed to the

Concerned Shareholders’ Information and Proxy Solicitation Agent:

 

LOGO

North American Toll Free Phone: 1-800-530-5189

Local (Collect outside North America): 416-751-2066

Email: info@carsonproxy.com


March 17, 2021

Dear Fellow Shareholder:

FSD is a corporation in crisis. The Concerned Shareholders are taking urgently needed action to preserve Shareholder value and rebuild the Company. The Concerned Shareholders are soliciting your support and, ultimately, intend to solicit forms of proxy, to replace the Board (other than Messrs. Durkacz and Saeed). Capitalized terms used but not defined herein have the definitions ascribed to them in the enclosed information circular.

Dr. Raza Bokhari, FSD’s Chief Executive Officer, and the Board (other than Messrs. Durkacz and Saeed) have:

 

   

failed to address the dramatic loss of Shareholder value, with the Class B Shares trading over 97% lower than when Dr. Bokhari was appointed Interim Chief Executive Officer;

 

LOGO

 

   

massively diluted Shareholder interests by issuing almost 16 million Class B Shares at low prices, increasing the number outstanding by over 83% in just seven weeks;

 

   

awarded over $5.7 million of bonus Share compensation to Dr. Bokhari in February 2021 for services yet to be provided and close to $1 million in Shares and/or cash to the other directors (Stephen Buyer, Robert Ciaruffoli, James Datin, Gerald Goldberg and Larry Kaiser), the latter amount being almost twice the previous year’s compensation;

 

   

caused FSD to reimburse Dr. Bokhari’s privately owned and controlled company for over $1.4 million of expenses in 2020, with limited transparency or explanation;

 

   

failed to effectively implement the Company’s business plan to become a pharmaceutical and biotechnology company, having to date failed to meet any of their modest stated goals;

 

   

denied Shareholders any say on the change of the Company’s strategic focus, failing to hold a Shareholders’ meeting in 2020 and seeking to delay holding a meeting in 2021; and

 

   

taken retaliatory actions against Concerned Shareholders that have unnecessarily exposed FSD to liability.


The Concerned Shareholders want to replace the Board (other than Messrs. Durkacz and Saeed) and have recruited three highly qualified candidates to do so: Nitin Kaushal, Lawrence Latowsky and Fernando Cugliari (together with Messrs. Durkacz and Saeed, the “Concerned Shareholders Nominees”). Each of these individuals has exceptional business experience, with backgrounds in biosciences-related operations. The three new nominees, Nitin Kaushal, Lawrence Latowsky and Fernando Cugliari, are all independent of both the Company and the Concerned Shareholders and are qualified to serve on the Company’s audit committee, due to their financial expertise. We believe strongly that each of these individuals has the requisite experience, expertise, perspective and motivation to maximize FSD’s true potential value. Further details concerning the Concerned Shareholders’ Nominees are contained in the enclosed information circular.

At the Meeting, Shareholders will have an opportunity to determine FSD’s future by voting for change.

We expect to issue a supplement to or amendment and restatement of the enclosed information circular containing details of the Meeting and instructions with regard to the completion and return of proxies and voting instruction forms to be provided by the Concerned Shareholders for use at the Meeting.

With your help, we will achieve a result at the Meeting that will serve the interests of all Shareholders.

The Concerned Shareholders encourage Shareholders to stay up-to-date on matters with respect to the Meeting at: www.RestoreFSD.com; Facebook: RestoreFSD; and Twitter: @RestoreFSD.

Yours truly,

The Concerned Shareholders of FSD


FORWARD-LOOKING STATEMENTS AND INFORMATION

Certain statements and information included, attached to or incorporated by reference, if any, into this Circular may contain “forward-looking statements” or “forward-looking information” within the meaning of applicable securities laws (collectively, the “forward-looking statements”), including, but not limited to, statements regarding the Meeting, the solicitation of proxies and voting in respect of the Meeting, the Concerned Shareholders, the intentions of the Concerned Shareholders or the Concerned Shareholders’ Nominees (as defined below), the impact of the Concerned Shareholders’ Nominees, if elected, on the financial condition, operations, business and strategies of FSD and its shareholder value, the composition of the Board and future plans or prospects of FSD. All statements and information, other than statements of historical fact, included or incorporated by reference into this Circular are forward-looking statements, including, without limitation, statements regarding activities, events or developments that the Concerned Shareholders expect or anticipate may occur in the future. Such statements reflect the Concerned Shareholders’ current views and intentions with respect to future events and are subject to certain risks, uncertainties and assumptions. Forward-looking statements can usually be identified by the use of forward-looking words such as “will”, “expect”, “intend”, “plan”, “estimate”, “anticipate”, “believe” or “continue” or similar words and expressions or the negative thereof. There can be no assurance that the plans, intentions or expectations upon which such forward-looking statements and information are based will occur or, even if they do occur, will result in the performance, events or results expected.

We caution readers of this Circular not to place undue reliance on forward-looking statements and information contained in the Circular, which are not a guarantee of performance, events or results and are subject to a number of risks, uncertainties and other factors that could cause actual performance, events or results to differ materially from those expressed or implied by such forward-looking statements. These factors include: changes in FSD’s strategies, plans or prospects; general economic, industry, business, regulatory and market conditions; actions of FSD and its subsidiaries or competitors; the ability to implement business strategies and plans and pursue business opportunities and conditions in the pharmaceutical and biotechnology industries; risks relating to government regulation and changes thereto, including in respect of the regulations concerning Board composition, proxy solicitation and shareholder meetings; the state of the economy including general economic conditions globally and economic conditions in the jurisdictions in which FSD operates; the unpredictability and volatility of FSD’s share price; availability of sufficient financial resources to fund the Concerned Shareholders’ solicitation efforts; changes in commodity prices and tax rates; currency fluctuations; changes in tax rates; government regulation of biotechnology and pharmaceuticals; and dilution and future sales of Shares. These factors should not be construed as exhaustive. Shareholders are cautioned that all forward-looking statements involve known and unknown risks and uncertainties, including those risks and uncertainties detailed in the continuous disclosure and other filings of FSD and certain members of FSD’s operational, compensation and other noted peer groups with applicable securities regulators, copies of which are available on the System for Electronic Document Analysis and Retrieval (“SEDAR”) at www.sedar.com or on the Electronic Data Gathering, Analysis, and Retrieval (“EDGAR”) at www.sec.gov. We urge you to carefully consider those risks and uncertainties. The forward-looking statements contained in this Circular are expressly qualified in their entirety by this cautionary statement. The Concerned Shareholders do not assume responsibility for the accuracy or completeness of the forward-looking statements. The forward-looking statements included in this Circular are made as of the date of this Circular and the Concerned Shareholders undertake no obligation to publicly update or revise such forward-looking statements to reflect new information, subsequent events or otherwise, except as required by applicable law.

CURRENCY

Unless otherwise indicated, all amounts in this Circular are stated in Canadian dollars.


PROXY CIRCULAR

This Circular and any form of proxy and/or voting instruction form subsequently furnished in connection with the Circular, is being provided in connection with the solicitation by and on behalf of the Concerned Shareholders for your support and, ultimately, of proxies to be used at the Meeting. The information contained in this Circular is given as of the date of this Circular, except where otherwise noted.

This solicitation is not made by or on behalf of management of the Company.

The Concerned Shareholders are soliciting your support and, ultimately, intend to solicit forms of proxy for use at the Meeting for the election of the following five nominees (the “Concerned Shareholders’ Nominees”) as directors of FSD: Anthony Durkacz, Zeeshan Saeed, Nitin Kaushal, Lawrence Latowsky and Fernando Cugliari.

The Concerned Shareholders expect to issue the Final Concerned Shareholders’ Circular containing details of the Meeting and instructions with regard to the completion and return of proxies and voting instruction forms to be provided by the Concerned Shareholders for use at the Meeting.

The Final Concerned Shareholders’ Circular will provide instructions for the completion and return of the form of proxy to be provided by Concerned Shareholders for use at the Meeting. Shareholders are urged to monitor Concerned Shareholders’ press releases and other filings to ensure they have all the information they require to take the necessary action within the prescribed time periods in order to show their support for the Concerned Shareholders’ proposed changes to the Board. Once the Company has issued a notice of meeting, together with its management information circular (the “Management Circular”), the Concerned Shareholders intend to issue the Final Concerned Shareholders’ Circular containing further disclosure concerning our reasons for seeking to elect the Concerned Shareholders’ Nominees to the Board. The Final Concerned Shareholders’ Circular will provide instructions for the completion and return of the form of proxy to be provided by the Concerned Shareholders for use at the Meeting. Shareholders are urged to monitor the Concerned Shareholders’ press releases and other filings to ensure they have all the information they require to take the necessary action within the prescribed time periods in order to show their support for the Concerned Shareholders’ proposed changes to the Board.

The Concerned Shareholders have no knowledge of the intentions of management with respect to the Meeting. You will be sent a Management Circular and a management form of proxy or voting instruction form from management of FSD soliciting proxies in connection with the Meeting. The Concerned Shareholders do not currently know which individuals, if any, management of FSD will nominate for election to the Board at the Meeting.

Unless otherwise noted, the information concerning FSD contained in this Circular has been taken from, or is based upon, publicly available documents or records on file with securities regulatory authorities in Canada and the United States and other public sources. Although the Concerned Shareholders have no knowledge that would indicate that any statement contained therein is untrue or incomplete, the Concerned Shareholders do not assume responsibility for the accuracy or completeness of such information or for any failure by FSD to disclose material information which may affect the significance or accuracy of such information.

Information concerning FSD is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.

Based on publicly available information, the head office of FSD is at 100 King St. West, Suite 3400, Toronto, Ontario, Canada, M5X 1A4 and the registered office of FSD is at 1 Rossland Road West, Suite 202, Ajax, Ontario, Canada, M5C 1P1.

A copy of this Circular may be obtained, on request and without charge, from our information and proxy solicitation agent, Carson Proxy Advisors Ltd. (“Carson Proxy”), by contacting them at 1-800-530-5189 (toll-free), or at 416-751-2066 (collect), or by email at info@carsonproxy.com, or under the Company’s issuer profile on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.


CONSOLIDATION

Effective October 16, 2019, the Company completed a consolidation of its Shares (the “Consolidation”) on the basis of one post-Consolidation Share for every 201 pre-Consolidation Shares. The information in this Circular is provided on a post-Consolidation basis, where applicable.

NOTICE TO UNITED STATES SHAREHOLDERS

FSD is governed by the laws of Ontario and the federal laws of Canada applicable therein. This solicitation of proxies is not subject to the requirements of Section 14(a) of the United States Securities Exchange Act of 1934, as amended (the “U.S. Exchange Act”). Accordingly, this solicitation of proxies is made in the United States with respect to securities of FSD in accordance with Ontario and Canadian corporate and securities laws and this Circular has been prepared in accordance with disclosure requirements applicable in Ontario. Shareholders in the United States should be aware that these requirements are different from the requirements applicable to proxy statements under the U.S. Exchange Act.

The enforcement by Shareholders of civil liabilities under United States federal securities laws may be affected adversely by the fact that the Concerned Shareholders are residents of Canada and a substantial portion of their assets are located outside the United States. Shareholders may not be able to sue the Concerned Shareholders in a foreign court for violations of United States federal securities laws. It may be difficult to compel foreign individuals to subject themselves to a judgment by a United States court.

THE REASON FOR THIS CIRCULAR

Dr. Raza Bokhari, FSD’s Chief Executive Officer, and the Board (other than Messrs. Durkacz and Saeed) have:

 

   

failed to address the dramatic loss of Shareholder value, with the Class B Shares trading over 97% lower than when Dr. Bokhari was appointed Interim Chief Executive Officer;

 

LOGO

 

   

massively diluted Shareholder interests by issuing almost 16 million Class B Shares at low prices, increasing the number outstanding by over 83% in just seven weeks;

 

   

awarded over $5.7 million of bonus Share compensation to Dr. Bokhari in February 2021 for services yet to be provided and close to $1 million in Shares and/or cash to the other directors (Stephen Buyer, Robert Ciaruffoli, James Datin, Gerald Goldberg and Larry Kaiser), the latter amount being almost twice the previous year’s compensation;

 

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caused FSD to reimburse Dr. Bokhari’s privately owned and controlled company for over $1.4 million of expenses in 2020, with limited transparency or explanation;

 

   

failed to effectively implement the Company’s business plan to become a pharmaceutical and biotechnology company, having to date failed to meet any of their modest stated goals;

 

   

denied Shareholders any say on the change of the Company’s strategic focus, failing to hold a Shareholders’ meeting in 2020 and seeking to delay holding a meeting in 2021; and

 

   

taken retaliatory actions against Concerned Shareholders that have unnecessarily exposed FSD to liability.

The Concerned Shareholders are taking urgently needed action to preserve Shareholder value and rebuild the Company

FSD is a corporation in crisis. After its Class B Shares were listed on the Canadian Securities Exchange in May 2018, they started trading at roughly $25 per Share. The share price quickly rose, and on September 21, 2018, FSD’s shares were trading at almost $179 per Share, resulting in a market capitalization of approximately $1.34 billion.

That is no longer the case. Both FSD’s Share price and market capitalization have declined by a staggering amount. Since October 29, 2018, when Dr. Bokhari was appointed Interim Chief Executive Officer, the price of FSD’s Shares has fallen by over 97%, wiping out over $500 million in market capitalization. FSD management and the Board have been unable to address this situation and their recent actions have compounded Shareholder losses.

Having refocused the Company away from cannabis in early-2020 to become an early-stage pharmaceutical and biotechnology venture, Dr. Bokhari and the Board (other than Mr. Durkacz and Mr. Saeed) have failed to achieve even the most modest objectives of their business plan. What they have done is issue an extraordinary number of Class B Shares at very low prices and awarded themselves excessive and unjustified compensation. To compound these failures, Dr. Bokhari and the Board (other than Mr. Durkacz and Mr. Saeed) have made every effort to avoid being held accountable by Shareholders. Their conduct is unconscionable and must be stopped before all Shareholder value is destroyed.

On March 5, 2021, the Concerned Shareholders succeeded in obtaining a court order that (i) FSD accelerate the date of its long overdue annual meeting of Shareholders to May 14, 2021 (which will also be a special meeting), (ii) an independent person (rather than Dr. Bokhari) be appointed to chair the Meeting and (iii) Dr. Bokhari and the other directors (other than Mr. Durkacz and Mr. Saeed) not be permitted to cast the votes attached to their recently acquired Shares at the Meeting.

We are asking Shareholders to vote with the Concerned Shareholders at the Meeting to replace Dr. Bokhari, Stephen Buyer, Robert Ciaruffoli, James Datin, Gerald Goldberg and Larry Kaiser with a new board comprised of five highly-qualified individuals who are strongly motivated to restore FSD. These nominees are Anthony Durkacz, Zeeshan Saeed, Nitin Kaushal, Larry Latowski and Fernando Cugliari. Further details about these nominees are included below under “Election of Directors – Concerned Shareholders’ Nominees.”

FSD’s Recent History

As Shareholders are aware, the strategic direction of the Company has been under consideration for years. FSD’s business has shifted between the medical cannabis industry and the pharmaceutical and biotechnology space without defining a clear path. FSD’s initial focus was on the Canadian medical cannabis industry through its subsidiary, FV Pharma Inc. In September 2018, FSD decided to expand its line of business to focus on researching and developing novel cannibanoid-based medical treatments. In June 2019, FSD acquired Prismic Pharmaceuticals Inc. (“Prismic”), a U.S.-based pharmaceutical company focused on the research and development of a particular lead compound, FSD201 (the “FSD Compound”), for medical applications. Prismic was the first, and thus far only, strategic acquisition in the pharmaceutical and biotechnology sector rather than the cannabis sector.

 

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Following FSD’s last shareholder meeting in December 2019, and without direct Shareholder input, the Board decided to refocus FSD’s business entirely away from cannabis and in favour of an exclusive focus on pharmaceuticals and biotechnology.

In doing so, Dr. Bokhari and the Board identified several key goals: (i) conducting a phase 2 clinical trial for the use of the FSD Compound in COVID-19 patients (the “Phase 2 Clinical Trial”), (ii) disposing of unnecessary assets, including the 620,000 square-foot cannabis processing facility in Cobourg, Ontario (the “Cobourg Property”) that has become obsolete under the new business plan and (iii) identifying strategic acquisition opportunities to diversify the Company’s business lines. In particular, the Board concluded that a strategic acquisition was an effective way to deploy the Company’s substantial cash reserves to accelerate the transition into a pharmaceutical and biotechnology company.

Failure to Advance Stated Goals

Dr. Bokhari and the Board have failed to achieve any of these objectives.

 

   

While the Phase 2 Clinical Trial was approved in September 2020, to date only one patient has been enrolled in the trial out of an “expected” 352 patients.

 

   

While the Company listed its Cobourg Property for sale in the first quarter of 2020, it remains unable to dispose of the property.

 

   

Management has failed to identify any viable or appropriate strategic acquisition opportunities.

During this 12-month period, FSD’s Share price has further declined from $5.70 on March 2, 2020 to $2.60 on March 1, 2021. This decrease has occurred at a time when the Nasdaq Composite Index has increased by over 50%.

Further Failures by Dr. Bokhari and the Board

In November 2020, as the price of the Shares approached new lows, Messrs. Durkacz and Saeed, founding directors of the Company and two of the Concerned Shareholders, spoke to Dr. Bokhari, about this lack of progress and identified what they believed was a promising strategic acquisition opportunity (the “Strategic Transaction”). They were disappointed that Dr. Bokahari showed no interest in considering the opportunity and, in December 2020, sought to have the Board reconsider Dr. Bokhari’s position.

While this might have been a simple difference of opinions on the perceived value of a strategic opportunity, which could have been easily debated among management and the Board and resolved, the circumstances that followed were something else entirely. The Concerned Directors quickly grew alarmed about FSD’s governance and the conduct of Dr. Bokhari and the Board (other than Mr. Durkacz and Mr. Saeed). Their concerns have only grown with the passage of time.

On December 16, 2020, Messrs. Durkacz and Saeed contacted the other Board members to propose a discussion of the Strategic Transaction. An independent member of the Board, Larry Kaiser, responded by suggesting a Board meeting be called and Dr. Bokhari replied to all Board members suggesting a Board call be scheduled for December 18, 2020. The following day, Dr. Bokhari cancelled the December 18, 2020 Board call with no explanation.

Consequently, on December 18, 2020, Messrs. Durkacz and Saeed exercised their right as directors to call a Board meeting to be held on Tuesday, December 22, 2020 (the “December 22 Board Meeting”). While several directors initially indicated their availability to attend the December 22 Board Meeting, Messrs. Durkacz and Saeed were later advised by FSD’s legal counsel in writing that a clear majority of the Board was unavailable to attend the December 22 Board Meeting and an alternate meeting was called for a month later on January 21, 2021. Dr. Bokhari later admitted that he told directors that they need not attend the December 22 Board Meeting if they did not want to. In fact, no directors other than Messrs. Durkacz and Saeed attended the December 22 Board Meeting.

 

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Given the Company’s dire circumstances, Messrs. Durkacz and Saeed believed that the Board should be prepared to meet on a timely basis to consider the proposed Strategic Transaction and tried again to exercise their rights as directors to call a Board meeting – this time to be held on December 30, 2020 (the “December 30 Board Meeting”). Again Messrs. Durkacz and Saeed received a letter from FSD’s legal counsel stating that, contrary to prior correspondence with various directors who had indicated their availability, none of the members of the Board were available to attend the December 30 Board Meeting.

During this time, Messrs. Durkacz and Saeed made several requests for access to the Company’s minute books and related governance records as they became concerned about apparent governance shortcomings. The Company did not provide access to these materials. Dr. Bokhari claimed they were unavailable, though was later able to make them available within 24 hours when questioned about these records under oath during a cross-examination.

It became clear to Messrs. Durkacz and Saeed that Dr. Bokhari was actively obstructing them from exercising their rights as directors and that other Board members were supporting him. Messrs. Durkacz and Saeed were frustrated by the Board’s apparent lack of a sense of urgency to remedy the Company’s decline. While undertaking a strategic acquisition was a core component of the Company’s new business plan, no opportunities were currently under consideration, and none had been proposed during the many months that had passed since March 2020. As if to underscore the Company’s intransigence, on December 18, 2020, Mr. Durkacz received a further letter from the Company’s legal counsel essentially telling him to cease and desist from his efforts to have the Board consider the proposed opportunity. In this context, there appeared to be no effective path for advancing the Strategic Transaction, or any other strategic opportunity.

The Concerned Shareholders Call a Special Meeting

Following the failure of Board members to attend both the December 22 Board Meeting and the December 30 Board Meeting, Messrs. Durkacz and Saeed spoke with the other Concerned Shareholders on January 3, 2021 about the Company’s continuing decline in the face of the active obstruction of the Chief Executive Officer and other Board members. The Concerned Shareholders concluded that it was necessary to requisition a special meeting of Shareholders to be held as soon as reasonably possible to vote on replacing the directors, other than Messrs. Durkacz and Saeed, with new directors who were willing and able to assist with rebuilding the Company and recovering Shareholder value.

On January 4, 2021, the Concerned Shareholders requisitioned the Company’s directors to call a special meeting of shareholders to be held not later than March 15, 2021 (the “Requisition”). The purpose of the requisitioned meeting was to remove all of the members of the Board (other than Messrs. Durkacz and Saeed) and to elect Messrs. Latowsky, Cugliari and Kaushal as new directors of the Company.

The Company had not held an annual meeting of Shareholders since December 2019, prior to the change in business strategy, and it was time for the Shareholders to have a chance to vote on FSD’s future. The Board (other than Messrs. Durkacz and Saeed) delayed considering the Requisition for several weeks before responding by scheduling a meeting to be held on June 29, 2021, nearly six months after the date of the Requisition.

Dilution of Shareholder Interests Through Unnecessary Share Issuances

Since the date of the Requisition on January 4, 2021, the Company has issued a staggering number of Class B Shares – a number equal to over 83% of the Class B Shares outstanding on that date. It has done this at a time when the Share price has been close to its all-time lows and despite no apparent or budgeted need for additional cash reserves. This action has diluted Shareholder interests and further depressed Share prices.

 

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In July 2020, the Company established a program for an at-the-market offering of its Class B Shares (the “2020 ATM Offering”) that allowed the Company to sell up to US$20,000,000 Class B Shares on the Nasdaq Capital Market (the “Nasdaq”). Prior to February 1, 2021, FSD had taken virtually no action under the 2020 ATM Offering. However, since the Requisition on January 4, 2021, the Company has issued over 7,412,574 Class B Shares under the 2020 ATM Offering for aggregate gross proceeds of US$19,976,512.33, with 99.2% of these Shares being issued between February 1 and 10, 2021.

According to the Company’s prospectus supplement dated February 11, 2021, the Class B Shares issued between February 1 and 10, 2021 were issued at a weighted average price of US$2.69 per Share. This can be compared to the average price of US$3.83 at which the Class B Shares were trading in the eight trading-day period following the launch of the 2020 ATM Offering. The Company made no use of the 2020 ATM Offering for months and then, following the Requisition (and despite a 30% drop in the Class B Share price), the Company issued the maximum number of Shares permitted under the 2020 ATM Offering.

On February 10, 2021, Dr. Bokhari called a Board meeting on a mere three hours’ notice to review and approve another at-the-market offering that would enable the Company to continue aggressively issuing and selling shares into the market. Messrs. Durkacz and Saeed objected in writing to this hastily called meeting but, nonetheless, the Board met without Messrs. Durkacz and Saeed and adopted a new at-the-market offering (the “2021 ATM Offering”) authorizing a further issuance of US$20,000,000 Class B Shares. From February 11, 2021 to March 12, 2021, the Company issued 7,247,288 Class B Shares under the 2021 ATM Offering, at a weighted average issue price of US$2.51 per Share, an even lower price than that received for the 2020 ATM Offering issuances.

As at March 16, 2021, the Company had issued a total of 15,953,378 Class B Shares in just seven weeks – over 83% of the total Class B Shares outstanding on January 4, 2021.

These recent Share issuances depart from any semblance of normal and appropriate governance process. The Board’s actions are harming all Shareholders by diluting the voting interest of all pre-existing Shareholders and, in turn, deflating FSD’s already depressed Share price, without any apparent justification. That is clearly evident by the sudden drop in the price of FSD’s Shares on February 11, 2021. Following disclosure of the 2021 ATM Offering, the trading price of FSD’s Shares fell from an opening price of US$4.33 to US$3.07, a 29% decline. As describe above, the weighted average issuance price under the 2021 ATM Offering has been even lower, at US$2.51 per Share.

These dilutive Share issuances are coming at a time when the trading price of the Class B Shares is at a low point and are entirely unnecessary to fund near-term expenses. Dr. Bokhari and the Board (other than Mr. Durkacz and Mr. Saeed) appear to be doing little to manage the Company’s capital-raising process to ensure the maximum benefit from the Company’s issuance of Class B Shares – a fact confirmed by Dr. Bokhari in cross-examination. In his own words, he explained that “capital raise must be an ongoing perpetual exercise” and “a prudent manager… is not in a position to determine… what is or is not a good share price… if a capital becomes available in an orderly fashion, you should continue to build your cash on balance sheet”.

This cavalier approach to the Company’s financing practices is harming all Shareholders and further depressing the Share price.

Self-Award of Exorbitant Compensation over the Past 12 Months

While Dr. Bokhari receives a nominal salary of $1 per year as a Chief Executive Officer, he has received excessive bonuses and has charged significant expenses to the Company. On February 23, 2020 and August 20, 2020, Dr. Bokhari received bonuses of $1.3 million and $2.5 million, respectively, both in the form of Class B Shares. In 2020, Dr. Bokhari’s privately owned and controlled company was reimbursed for over $1.4 million of expenses by the Company, with limited transparency or explanation as to the rationale for this extraordinary amount.

 

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On February 10, 2021, following the Concerned Shareholders’ Requisition, Dr. Bokhari, Stephen Buyer, Robert Ciaruffoli, James Datin, Gerald Goldberg and Larry Kaiser awarded themselves further cash and Class B Shares for services yet to be provided. The value of the 1,173,709 Class B Shares awarded to Dr. Bokhari on February 10, 2021 was over $5.7 million, based on the closing price on that day. Board members Stephen Buyer, Robert Ciaruffoli, James Datin, Gerald Goldberg and Larry Kaiser awarded themselves compensation in the form of cash and Class B Shares equal to nearly $1 million. Compensation on this scale for serving a company the size of FSD, at a time when its Shares are trading at all-time lows and stock markets are at all-time highs, is unconscionable. Furthermore, the award of bonus compensation to Dr. Bokhari in advance of receiving his services is contrary to all normal conduct and is prohibited under the Company’s governing statute.

These extraordinary compensation and expense amounts are wholly inconsistent with the Company’s circumstances, performance and the loss of Shareholder value during the Board and Dr. Bokhari’s tenure. Dr. Bokhari and the Board are extracting the most compensation possible from a struggling Company before they lose the ability to reward themselves, without regard to the interests of Shareholders.

No member of the Board other than Messrs. Durkacz and Saeed has opposed any of these actions.

Dr. Bokhari’s Punitive Actions Against Concerned Shareholders

Dr. Bokhari has also used his position as the Company’s Chief Executive Officer to take direct actions against individual Concerned Shareholders. These improper punitive actions have exposed the Company to unnecessary legal claims.

Mr. Dutton, a Concerned Shareholder, is the co-founder of Prismic, which was acquired by the Company in June 2019. Following the acquisition, Mr. Dutton became a Company employee. He recently agreed to transition into a consulting role provided that the Company pay him the 10 months’ severance that was owing under his employment agreement. When Dr. Bokhari became aware that Mr. Dutton was a member of the Concerned Shareholders, he advised him, through Dr. Edward Brennan, the President of FSD’s biosciences division, to withdraw his support of the Requisition. Using Dr. Brennan as a conduit for his message, Dr. Bokhari threatened to terminate payment of the amounts owing to Mr. Dutton and ultimately acted on these threats by terminating the payments without any valid reasons.

Shockingly, this is not the only example of Dr. Bokhari abusing the power of his role to silence opposition to his conduct. Mr. Saeed, a Concerned Shareholder, is a co-founder of FSD. On December 23, 2020, the Company’s legal counsel wrote to him advising that a special committee of the Board was conducting an investigation into certain employment-related matters involving Mr. Saeed. Under oath during cross-examination, Dr. Bokhari has since acknowledged that there was no such special committee and that this was merely an independent action undertaken by him to attack Mr. Saeed for “insubordination” in the face of his challenges to the Company’s management. On January 25, 2021, Mr. Saeed was advised that he was being terminated for cause. The Company did not undertake any formal investigation or other appropriate human resources process to support this termination. In fact, reasons cited in the termination notice were without merit and the purported investigation process underlying these conclusions was a sham.

As with Mr. Dutton, this was an improper, personally motivated action taken to advance Dr. Bokhari’s fight against the Requisition and has exposed the Company to a claim for substantial financial damages, as well as harm to its reputation. At this time, Mr. Saeed is focused on addressing the Company’s challenges and has no interest in taking action to the detriment of all Shareholders. However, these instances serve as further examples of Dr. Bokhari’s erratic and harmful conduct and the Board’s unwillingness to challenge his abuse of power.

Court Ordered Meeting and Other Remedies

On March 4, 2021, the Concerned Shareholders brought an action in the Ontario Superior Court of Justice (Commercial List) (the “Court”) seeking an order that the Company accelerate the date of its annual Shareholders’ meeting from its proposed date of June 29, 2021. After hearing evidence regarding the conduct of Dr. Bokhari and the Board, the Court ordered the Company to hold a meeting of Shareholders on May 14, 2021. As a result, the special meeting called by the Concerned Shareholders for March 2021 will not be required.

 

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As requested by the Concerned Shareholders, the Court also ordered that Dr. Bokhari not act as chair of the Meeting. Instead, an independent person will be appointed to ensure that the Meeting is run in a fair and orderly fashion.

As suggested by the Concerned Shareholders during the course of the hearing, the Court also ordered that the votes attached to shares issued since the date of the Requisition to Dr. Bokhari, Stephen Buyer, Robert Ciaruffoli, James Datin, Gerald Goldberg and Larry Kaiser, and any entities related to any of them, not be counted at the Meeting.

The Concerned Shareholders were relieved by the Court’s decision. It will allow Shareholders to expeditiously address the many issues arising from the misconduct of Dr. Bokhari and the members of the Board that have enabled him.

The Company’s Future

If elected at the Meeting, the Concerned Shareholders’ Nominees hope to restore FSD by:

 

   

acquiring biotechnology assets focused on legal medical cannabis and/or legal psychedelics to increase the Company’s drug development pipeline and reduce reliance on a single compound;

 

   

auditing the Company’s current Phase 2 Clinical Trial to determine its current viability and better understand the risks and costs so that appropriate budgets can be created and followed and to determine whether it should be continued;

 

   

implementing a strong financial and corporate governance framework so that directors and management are restricted in granting compensation to themselves at levels higher than industry standards;

 

   

implementing audits of prior compensation and expenses incurred by the Company; and

 

   

developing a robust investor relations function to better communicate FSD’s value to the investment community.

Conclusion

Dr. Bokhari and the Board members who are enabling him are destroying Shareholder value. The Share price has declined by over 97% and the Company’s market capitalization has shrunk by over $500 million since Dr. Bokhari was appointed Interim Chief Executive Officer on October 29, 2018.

During this time, the Board has attempted to refocus the Company as an early-stage pharmaceutical and biotechnology venture. Yet, it has failed to achieve any of its stated goals, deferred holding a Shareholder meeting and actively obstructed two founding directors who have questioned Dr. Bokhari’s leadership and the complacency of other Board members.

In the face of these challenges, and with clear disregard to the interests of Shareholders, the Board has aggressively issued an extraordinary number of Shares in just seven weeks – equal to over 83% of the number outstanding on January 4, 2021.

As a reward for its failings, the Board in February 2021 has issued itself, and Dr. Bokhari in particular, an excessive amount of compensation for a company in FSD’s circumstances and size, in aggregate equal to the market value of approximately $6.6 million (as at the closing price of February 10, 2021).

The Board (other than Concerned Shareholders) have enabled Dr. Bokhari despite his poor performance and have disregarded his misconduct, including threatening two of the Concerned Shareholders and taking actions that have gratuitously exposed the Company to legal actions.

The Concerned Shareholders have taken action, both by requisitioning a special meeting and later by Court action at their personal cost, to compel the Company to hold the Meeting in a timely fashion in order to address the continued erosion of Shareholder value as soon as possible. The Court order will help ensure that the Meeting is conducted in a fair and effective manner so that the will of the Shareholders will be recognized and respected.

 

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The Board’s ineffective oversight of management and outrageous self-awards of bonus compensation are accelerating the Company’s decline and must be stopped. This utter failure to address the Company’s urgent needs, or even achieve stated goals, has been compounded by recent misconduct of the Board and management.

 

Dr. Bokhari and the Board have:

 

   

failed to address the dramatic loss of Shareholder value,

 

   

massively diluted Shareholder interests,

 

   

enriched themselves,

 

   

failed to implement the Company’s business plan to become a pharmaceutical and biotechnology company,

 

   

denied Shareholders any say on the Company’s strategic refocus, and

 

   

taken retaliatory actions against Concerned Shareholders.

Shareholders are urged to monitor the Concerned Shareholders’ press releases and other filings at www.RestoreFSD.com to ensure they have all the information they require to take necessary action within the prescribed time periods in order to show their support for the Concerned Shareholders’ proposed changes to the Board.

ELECTION OF DIRECTORS

Current Board of Directors

To the knowledge of the Concerned Shareholders, the current Board is comprised of the following eight individuals: Dr. Bokhari, Stephen Buyer, Robert Ciaruffoli, James Datin, Gerald Goldberg, Larry Kaiser, Anthony Durkacz and Zeeshan Saeed. Each such director currently holds office until the next annual meeting of the Company or until a successor is elected or appointed.

The Concerned Shareholders do not currently know which, if any, of these individuals FSD will nominate for election to the Board at the Meeting; however, we expect details will be provided in the Management Circular expected to be issued in respect of the Meeting, once filed.

Information regarding the current Board members’ location of residence, term of office, Board committee membership(s), present principal occupation, business or employment, positions held at the Company or any of its subsidiaries and securities of the Company or its subsidiaries beneficially held, other than in respect of Messrs. Durkacz and Saeed, is not within the knowledge of the Concerned Shareholders, as the Concerned Shareholders only have access to public information regarding FSD. For this information, please refer to the Company’s management information circular dated November 14, 2019 filed in respect of the Company’s annual Shareholders’ meeting held on December 16, 2019 and to the Management Circular expected to be issued in respect of the Meeting, once filed, and other continuous disclosure filed by the Company on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.

 

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Concerned Shareholders’ Nominees

The Concerned Shareholders propose to nominate the five highly qualified and experienced individuals set out below for election to the Board at the Meeting, three of which would be new and independent directors. The following table sets out, in respect of each Concerned Shareholders’ Nominee, the individual’s name, province or state and country of residence, age, the individual’s present occupation and principal occupation over the previous five years, and the number of Shares beneficially owned, directly or indirectly, or over which control or direction is exercised, by such individual:

 

Name, Province or State

and Country of Residence,

and Age of Nominee(1)

  

Present Principal Occupation and

Occupation(s) for the Previous Five Years

  

Number of Shares

Beneficially Owned,

Controlled or Directed,

Directly or Indirectly(3)

Anthony Durkacz

Toronto, Ontario, Canada

Age: 45

   Director of FSD since June 18, 2018; Director and Executive Vice-President of First Republic Capital Corporation since 2014; President of Fortius since 1999.    450,058(4)

Zeeshan Saeed

Mississauga, Ontario, Canada

Age: 51

   Director of FSD since May 24, 2018; President from May 2019 to January 25, 2021; Executive Vice President of FV Pharma Inc. from December 1, 2017 to May 2019; Consultant to FV Pharma Inc. from October 2013 to December 2017; President of ZZ Telecommunications Inc. from April 2003 to December 2017.    504,476(5)

Nitin Kaushal(2)

Richmond Hill, Ontario, Canada

Age: 55

   President of Anik Capital Corp. since March 2020; Managing Director in the corporate finance practice at PricewaterhouseCoopers from 2012 to February 2020.    Nil

Lawrence (Larry) Latowsky(2)

Aurora, Ontario, Canada

Age: 61

   Chief Executive Officer of Canntab Therapeutics Ltd. since June 2020; Chairman and Chief Executive Officer of Top Drug Corp. from 2014 to 2020.    Nil

Fernando Cugliari(2)

Crystal Harbour, Grand Cayman, Cayman Islands

Age: 45

   International Investment Advisor at CIBC FirstCaribbean International Bank since May 2018; Head of the Private Client and Private Equity Group at Etienne Blake Attorneys at Law from November 2017 to April 2018; General Counsel and Chief Operating Officer of FasPay Global from September 2016 to September 2017; Associate Portfolio Manager & International Investment Advisor at RBC Wealth Management from June 2012 to May 2016.    Nil

 

(1)

The information concerning each of the Concerned Shareholders’ Nominees in this table has been furnished by the respective Concerned Shareholders’ Nominee.

(2)

These Concerned Shareholders’ Nominees have not been and are not currently directors of the Company, nor have these Concerned Shareholders’ Nominees held any other position or office with the Company or any of its affiliates in the past five years.

(3)

Reflects ownership as of the date hereof.

(4)

See “About the Concerned Shareholders – Anthony Durkacz and Fortius Research and Trading Corp.” for further details.

(5)

See “About the Concerned Shareholders – Zeeshan Saeed” for further details.

 

15


Each of the Concerned Shareholders’ Nominees has consented to being named as a nominee in this Circular. It is not contemplated that any of the Concerned Shareholders’ Nominees will be unable to stand for election to the Board at the Meeting or to serve as a director if elected.

To the knowledge of the Concerned Shareholders, there are no arrangements or understandings between any of the Concerned Shareholders’ Nominees and any other person or company pursuant to which the Concerned Shareholders’ Nominees are to be elected. The Concerned Shareholders acknowledge that if the Concerned Shareholders’ Nominees are elected or appointed to the Board, all of their activities and decisions as a director will be governed by applicable law and subject to the directors’ fiduciary duties to the Company and the Shareholders, as applicable, and, as a result, there is, and can be, no agreement between the Concerned Shareholders’ Nominees and the Concerned Shareholders that governs the decisions which the Concerned Shareholders’ Nominees will make as directors of the Company.

If elected, each of the Concerned Shareholders’ Nominees and other elected members of the Board will hold office until the close of the Company’s next annual meeting of Shareholders or until a successor has been elected or appointed in accordance with the Company’s articles and by-laws, unless his or her office is earlier vacated. If elected, the Concerned Shareholders’ Nominees will be required to discharge their duties as directors of the Company consistent with all applicable legal requirements, including fiduciary obligations imposed on all corporate directors.

The Concerned Shareholders’ Nominees are highly experienced and qualified business leaders from a broad range of sectors. Each of the Concerned Shareholders’ Nominees is committed to using his own independent business judgment, gained over decades of business leadership, to create long-term value for all Shareholders.

Biographies for each of the Concerned Shareholders’ Nominees

Anthony Durkacz

Mr. Durkacz has served as a director and the Executive Vice-President of First Republic Capital Corporation since 2014. Prior to co-founding the Company, Mr. Durkacz was President of Capital Ideas Investor Relations. He previously served as the Chief Financial Officer and a director of Snipp Interactive Inc., a global marketing solutions company that provides a modular software-as-a-service technology suite. Mr. Durkacz was instrumental in the financing and public listing of Snipp Interactive Inc. with operations in Canada, the United States of America, Mexico and India. From 2006 to 2009, he served as Chief Operating Officer and Chief Financial Officer of MKU Canada Inc. and engaged in mergers and acquisitions of companies around the world. Mr. Durkacz also served as the Chief Financial Officer and a director of Astris Energi Inc., a dual-listed public company in the United States and Canada which was acquired by an international conglomerate. Mr. Durkacz began his career at TD Securities on the capital markets trading floor. He holds an Honours Bachelor of Business Administration from Brock University with a major in both Accounting and Finance.

For more information about Mr. Durkacz, see “About the Concerned Shareholders – Anthony Durkacz and Fortius Research and Trading Corp.”.

Zeeshan Saeed

As a founder of the Company, Mr. Saeed was instrumental in raising the initial seed capital and assisted FSD’s transition into a public company. He played a key role in bringing together a team of professionals to facilitate crucial relationships and develop the Company’s business plan. Prior to founding the Company, Mr. Saeed served as President of ZZ Telecommunications Inc., a long-distance telecommunications common carrier. He has experience in international capital markets and has helped various start-ups with raising initial funding and obtaining listings on various stock exchanges. Before entering capital markets, Mr. Saeed was the founder and Chief Executive Officer of Platinum Telecommunications Inc. He has a Bachelor of Science in Mechanical Engineering.

 

16


For more information about Mr. Saeed, see “About the Concerned Shareholders – Zeeshan Saeed”.

Nitin Kaushal

Since March 2020, Nitin Kaushal has served as President of Anik Capital Corp., his family’s holding company. In February 2020, he retired from PricewaterhouseCoopers Canada (“PwC”) where he was a Managing Director in the corporate finance practice, which focused on the pharmaceutical and healthcare spaces. He had worked at PwC since 2012. Mr. Kaushal has over 30 years of experience in the healthcare and financial services industries, focusing on the biotechnology, medical devices and healthcare services markets. He was a Managing Director of leading healthcare investment banking teams at a number of Canadian investment banks including Desjardins Securities Inc., Orion Securities Inc., Vengate Capital, HSBC Securities Inc. and Gordon Capital. He has been involved in over 50 mergers and acquisitions, strategic advisory roles and licensing assignments for a range of companies from early-stage biotechnology companies to large pharmaceutical companies. He has participated in capital market transactions ranging from private placements to initial public offerings to bought deal underwritings in excess of $2B and has been a speaker at leading biotech conferences, including BIO and BioFinance. His entry into the biotech/healthcare space was in 1991 with MDS Capital Corp., a leading healthcare venture capital firm.

Mr. Kaushal sits on a number of public and private company boards in the biotech and healthcare space, including Delta 9 Cannabis Inc., The Valens Company Inc., High Tide Inc. VieMed Healthcare Inc., Starton Therapeutics Inc., Flower One Holdings Inc., PsyBio Therapeutics Corp. and 3 Sixty Risk Solutions Ltd. (“3 Sixty”). Mr. Kaushal has a Bachelor of Science in Chemistry from the University of Toronto and is a Chartered Professional Accountant.

Lawrence (Larry) Latowsky

Mr. Latowsky is currently Chief Executive Officer of Canntab Therapeutics Ltd., an innovator in cannabinoid and terpene blends in hard pill form for therapeutic application. Mr. Latowsky has held a number of leadership positions throughout his career, including Chairman and Chief Executive Officer of Top Drug Corp. from 2014 to 2020 and previously President and CEO of Katz Group Canada, overseeing the largest network of pharmacy retailers in Canada operating as Rexall, Pharmaplus, IDA and Guardian Drugstores. Mr. Latowsky also led Propharm Technology and DC Labs, a vertical manufacturing and packaging division of pharmaceuticals and over-the-counter drug store product. Mr. Latowsky is a graduate of the University of Toronto Rotman Business School and Institute of Corporate Directors of Canada program and has served on many profit and non-profit boards, including as Chairman of the board for Well.ca, one of Canada’s leading E-commerce companies. Mr. Latowsky’s experience is a unique blend of traditional retail bricks and mortar, distribution, manufacturing and e-commerce/internet-based marketing and sales.

Fernando Cugliari

Mr. Cugliari has over 20 years of experience in finance and law, and is an attorney qualified to practice in Ontario and the Cayman Islands. Mr. Cugliari is currently an International Investment Advisor at CIBC FirstCaribbean International Bank, where he provides comprehensive investment advisory services to high and ultra-high-net-worth individuals and their families, as well as insurance, corporate, institutional and pension fund clients. From November 2017 to April 2018, Mr. Cugliari worked as the Head of the Private Client and Private Equity Group at Etienne Blake Attorneys at Law, a law firm in the Cayman Islands, and from September 2016 to September 2017 he worked as General Counsel and Chief Operating Officer for FasPay Global, an international financial and payments technology company. He previously held senior positions in law firms in Ontario.

 

17


Independence

Nitin Kaushal, Lawrence Latowsky and Fernando Cugliari are “independent” of FSD within the meaning of National Instrument 58-101Disclosure of Corporate Governance Practices and National Instrument 52-110Audit Committees. Further, all of the Concerned Shareholders’ Nominees are “financially literate” and have the skills required in order to be members of the Audit Committee of FSD. Following the election of the Concerned Shareholders’ Nominees, we expect that the resulting Board will be composed of a majority of independent directors.

Messrs. Durkacz and Saeed have been employees and/or executive officers of the Company within the past three financial years. Mr. Durkacz served as the Company’s Executive Co-Chairman from October 2018 to November 17, 2020. Mr. Saeed served as President of FSD from May 2019 to January 25, 2021 and Executive Vice President of FV Pharma Inc., as subsidiary of the Company, from December 1, 2017 to May 2019. For more information about Messrs. Durkacz and Saeed, see “About the Concerned Shareholders” and “– Concerned Shareholders’ Nominees”.

Cease Trade Orders and Bankruptcies

Except as disclosed below, to the knowledge of the Concerned Shareholders, no Concerned Shareholders’ Nominee (or a personal holding company of such Concerned Shareholders’ Nominees) is, or has been, within 10 years before the date of this Circular, a director or executive officer of any company that:

 

  (a)

was the subject of a cease trade or similar order or an order that denied the relevant company access to any exemption under securities legislation, in each case, that was in effect for a period of more than 30 consecutive days (an “order”) that was issued while the Concerned Shareholders’ Nominee was acting in the capacity as a director or an executive officer;

 

  (b)

was subject to an order that was issued after the Concerned Shareholders’ Nominee ceased to be a director or executive officer in the company being the subject of an order and which resulted from an event that occurred while that Concerned Shareholders’ Nominee was acting in the capacity as director or executive officer; or

 

  (c)

has, while the Concerned Shareholders’ Nominee was acting in that capacity or within a year of ceasing to act in the capacity of a director or executive officer, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets.

Mr. Kaushal has been serving as a director of 3 Sixty since June 2019. On June 9, 2020, 3 Sixty announced that it was not able to file its annual financial statements and accompanying management’s discussion and analysis for the financial year ended December 31, 2019 within the period prescribed for such filings. 3 Sixty made an application for a management cease trade order (the “MCTO”) and, on June 18, 2020, the MCTO was issued by the Ontario Securities Commission (the “OSC”) and restricted all trading in securities of 3 Sixty by its directors and officers until two business days following the completion of the required filings. On July 15, 2020, the OSC revoked the MCTO and issued a failure-to-file cease trade order (the “FFCTO”) in replacement of it, ordering that all trading in the securities of 3 Sixty would cease, except in accordance with the conditions of the FFCTO, if any, for so long as the FFCTO remains in effect. As of the date of this Circular, the FFCTO remains in effect. According to 3 Sixty’s public disclosure, it will seek to have the FFCTO revoked and trading reinstated once all outstanding continuous disclosure documents have been filed.

To the knowledge of the Concerned Shareholders, none of the Concerned Shareholders’ Nominees have, within 10 years before the date of this Circular, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromised with creditors, or had a receiver, manager or trustee appointed to hold their assets.

 

18


Penalties and Sanctions

To the knowledge of the Concerned Shareholders, none of the Concerned Shareholders’ Nominees have been subject to any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority, entered into a settlement agreement with a securities regulatory authority or been subject to any other penalties or sanctions imposed by a court or regulatory body that would be likely be considered important to a reasonable securityholder making a decision about whether to vote for any Concerned Shareholders’ Nominee.

HOW THE CONCERNED SHAREHOLDERS WILL VOTE

At the Meeting, the representatives of the Concerned Shareholders currently intend, unless instructed otherwise by a Shareholder depositing a proxy, to cast the votes represented by each proxy deposited by Shareholders in favour of the Concerned Shareholders’ proxyholders FOR the election of the five Concerned Shareholders’ Nominees to the Board, in place of any nominees to be proposed for election by the Company, although the actual number of Concerned Shareholders’ Nominees may be different, depending on the number of directors nominated by the Company for election at the Meeting. See “Election of Directors” for further details.

ABOUT THE CONCERNED SHAREHOLDERS

None of the Concerned Shareholders are or have been a dissident within the preceding 10 years.

Anthony Durkacz and Fortius Research and Trading Corp.

Mr. Durkacz is a co-founder, director, and significant Shareholder of the Company. From October 2018 to November 17, 2020, he served as the Executive Co-Chairman of the Company. Since June 2019, Mr. Durkacz has served as a director and Chairman of the Board of World Class Extractions Inc., a cannabis extraction company. Since 1999, Mr. Durkacz has served as President of Fortius. Mr. Durkacz has served as Executive Vice President and a director of First Republic since January 2014.

Mr. Durkacz beneficially owns, directly or indirectly, or exercises control or direction over, a total of 24 Class A Shares and 450,058 Class B Shares, as well as 99,502 options and 199,004 warrants exercisable into Class B Shares, of which Fortius is the registered owner of all 24 Class A Shares and 106,043 Class B Shares and First Republic is the registered owner of 170,418 Class B Shares. On June 10, 2019, Mr. Durkacz purchased 12 Class A Shares for $26 per Share. On March 5, 2020, Mr. Durkacz sold 12 Class A Shares for $10 per Share.

Mr. Durkacz currently resides at 3006-2045 Lakeshore Blvd. W., Toronto, ON, M8V 2Z6, Canada.

Fortius provides financial consulting services and Mr. Durkacz is the sole owner, officer and director. The registered and head office of Fortius is located at Mr. Durkacz’s address.

Zeeshan Saeed

Mr. Saeed is a co-founder, director and significant Shareholder of the Company. Mr. Saeed also served as President of the Company from May 2019 to January 25, 2021. From December 1, 2017 to May 2019, Mr. Saeed served as Executive Vice President of FV Pharma Inc., a subsidiary of the Company and a former licensed producer of cannabis in Canada under the Cannabis Act (Canada). From October 2013 to December 2017, he provided consulting services to FV Pharma Inc. From April 2003 to December 2017, Mr. Saeed served as President of ZZ Telecommunications Inc.

 

19


Mr. Saeed beneficially owns, directly or indirectly, or exercises control or direction over, 24 Class A Shares, 504,476 Class B Shares and 199,004 options exercisable into Class B Shares, of which Xorax is the registered owner of all 24 Class A Shares and 317,543 Class B Shares. On June 10, 2019, Mr. Saeed purchased 12 Class A Shares for $26 per Share. On March 5, 2020, Mr. Saeed sold 12 Class A Shares for $10 per Share.

Mr. Saeed currently resides at 3688 Stratton Woods Court, Mississauga, ON, L5L 4V2, Canada. The registered and head office of FV Pharma Inc. is located at 1 Rossland Road West Suite 202, Ajax, ON, L1Z 1Z2, Canada. The registered and head office of ZZ Telecommunications Inc. is located at Mr. Saeed’s address.

Zachary Dutton

Mr. Dutton is currently an independent contractor and angel investor. Mr. Dutton previously served as President from November 2011 to April 2019 and Chief Executive Officer from April 2018 to June 2019 of Prismic. Following the acquisition of Prismic by the Company in July 2019, Mr. Dutton continued as Chief Executive Officer of Prismic from July 2019 to December 2020.

Mr. Dutton beneficially owns, directly or indirectly, or exercises control or direction over, 226,890 Class B Shares, of which 13,986 are registered to the Dutton Family Trust and 48,492 are registered to DCM Prismic Holdings, LLC. On June 28, 2019, Mr. Dutton was issued 164,412 Class B Shares in connection with the acquisition of Prismic by the Company.

Mr. Dutton currently resides at 650 South Rd., Holden, Massachusetts, 01520, United States of America. The registered and head office of Prismic is located at 474, Grove Street, Suite 740, Worcester, Massachusetts, USA, 01605. The registered offices of DCM Prismic Holdings, LLC and the Dutton Family Trust are located at Mr. Dutton’s address.

Andrew Durkacz & Gloria Durkacz

Andrew Durkacz and Gloria Durkacz are retired and have held no principal occupation or employment during the past five years. Andrew and Gloria Durkacz reside at 158 Chapman Road, Toronto, ON, M9P 164, Canada. Together, they beneficially own, directly or indirectly, or exercise control or direction over, 15,732 Class B Shares.

The following table provides the dates and amounts relating to sales of Class B Shares by Andrew and Gloria Durkacz in the preceding two years:

 

Date

   Type of Securities    Number of Shares      Price per Share  

April 2, 2019

   Class B Shares      995      $ 45.23  

April 3, 2019

   Class B Shares      995      $ 44.28  

April 4, 2019

   Class B Shares      497      $ 44.27  

April 4, 2019

   Class B Shares      497      $ 45.27  

April 5, 2019

   Class B Shares      497      $ 44.27  

April 5, 2019

   Class B Shares      497      $ 44.27  

May 22, 2019

   Class B Shares      1,990      $ 47.24  

May 23, 2019

   Class B Shares      1,889      $ 46.23  

May 27, 2019

   Class B Shares      1,791      $ 43.22  

June 3, 2019

   Class B Shares      1,990      $ 37.19  

June 4, 2019

   Class B Shares      1,194      $ 37.53  

July 29, 2019

   Class B Shares      2,487      $ 24.13  

August 19, 2019

   Class B Shares      2,985      $ 20.10  

 

20


First Republic Capital Corp.

First Republic is an exempt market dealer in Canada. Richard Goldstein is a director and the President and Anthony Durkacz is the majority owner as well as a director and Executive Vice President. First Republic holds 163,254 warrants, exercisable into Class B Shares, for the benefit of certain dealer representatives (which, for greater certainty, do not include Mr. Durkacz). On October 16, 2019, First Republic exercised warrants to purchase 11,970 Class B Shares at a price of $7.638 per Class B Share. The registered and head office of First Republic is located at 55 University Avenue, Suite 1002, Toronto, Ontario, M5J 2H7, Canada.

Richard Goldstein has been serving as President and a director of First Republic since 2006. Mr. Goldstein beneficially owns, directly or indirectly, or exercises control or direction over, 7,000 Class B Shares. Richard Goldstein currently resides at 411 Cranbrooke Ave., Toronto, ON, M5M 1N4, Canada.

Xorax Family Trust

Xorax is a family trust. Since 2013, Rehan Saeed has served as the trustee and Zeeshan Saeed has served as the alternate trustee. The registered and head office of Xorax is located at 3688 Stratton Woods Court, Mississauga, ON, L5L 4V2, Canada.

Since 2007, Rehan Saeed has been a principal shareholder and director of AYA Financial Inc. Rehan Saeed beneficially owns, directly or indirectly, or exercises control or direction over, 73,359 Class B Shares, of which 37,000 are registered to Legacy Family Trust, and 100,000 options exercisable into Class B Shares. On behalf of Rehan Saeed, Legacy Family Trust sold 38,823 Class B Shares on February 9, 2021 for $3.80 per Share and another 30,000 Class B Shares on February 10, 2021 for US$3.80 per Share. Rehan Saeed currently resides at 3682 Stratton Woods Court, Mississauga, ON, L5L 4V2, Canada. The registered and head office of AYA Financial Inc. is located at 60 Columbia Way, Suite 207, Markham, ON, L3R 0C9, Canada. The registered and head office of the Legacy Family Trust is located at Rehan Saeed’s address.

GENERAL PROXY INFORMATION

Appointment of Proxies

The Concerned Shareholders have not yet prepared a form of proxy for use at the Meeting. Once the Company has issued its notice of meeting and Management Circular, the Concerned Shareholders will provide a form of proxy, together with the Final Concerned Shareholders’ Circular, which will contain instructions on how to submit your proxy.

A Shareholder has the right to appoint a person or company (who need not be a Shareholder) other than the persons designated in any form of proxy provided to the Shareholder to represent the Shareholder at the Meeting. You will be able to exercise this right by inserting the name of the person you wish to appoint as your representative in the blank space provided in the form of proxy to be provided or by submitting another appropriate form of proxy. If you beneficially own your Shares but are not the registered holder, see “– Non-Registered (Beneficial) Holders of Shares” of this Circular for important information about how to appoint a representative of the Concerned Shareholders as proxyholder for your Shares.

A properly completed form of proxy will automatically revoke an earlier form of proxy deposited by you in respect of the Meeting. If you are a registered holder of Shares you may also revoke a proxy you have already given to management or any other form of proxy previously given by you by attending the Meeting and indicating your wish to vote at the Meeting.

Corporate Shareholders

Any Shareholder that is a corporation may, by resolution of its directors or other governing body, authorize such person as it thinks fit to exercise, in respect of and at the Meeting, the same powers on behalf of the corporation as that corporation could exercise if it were an individual Shareholder personally present, including the right (unless restricted by such resolution) to appoint a proxyholder to represent such corporation. Evidence in writing of the appointment of any such representative should accompany a corporate Shareholder’s completed proxy.

 

21


Revocation of Proxies

The Concerned Shareholders are not requesting that Shareholders submit a proxy at this time. Once the Concerned Shareholders have commenced a formal solicitation of proxies, a registered holder of Shares that gives a proxy may revoke it:

 

  (a)

by completing and signing a valid proxy bearing a later date and returning it in accordance with the instructions contained in the form of proxy to be provided by the Concerned Shareholders, or as otherwise provided in the Final Concerned Shareholders’ Circular, once made available to Shareholders;

 

  (b)

by depositing an instrument in writing executed by you or by your attorney authorized in writing, as the case may be: (i) at the registered office of the Company, at any time up to and including the last business day preceding the day of the Meeting or any adjournment or postponement of the Meeting is to be held, or (ii) with the Chair of the Meeting prior to its commencement on the day of the Meeting or any adjournment or postponement of the Meeting; or

 

  (c)

in any other manner permitted by law.

If you are the beneficial owner, but not the registered holder, of your Shares, see “– Non-Registered (Beneficial) Holders of Shares” of this Circular for instructions on how to revoke any proxies you give in connection with the Meeting.

Voting of Shares Represented by Proxy

The Concerned Shareholders’ representatives designated in the proxy to be deposited by you once such form of proxy is made available by the Concerned Shareholders, as provided in this Circular and the Final Concerned Shareholders’ Circular, will vote (or withhold from voting) your Shares represented by that proxy in accordance with your instructions on any ballot that may be called at the Meeting.

If you specify a choice with respect to voting in the form of proxy to be provided by the Concerned Shareholders, your Shares will be voted or withheld accordingly. If you do not specify a choice in such proxy or in an otherwise valid proxy, your Shares to which the proxy pertains will be voted FOR the election of the five Concerned Shareholders’ Nominees to the Board, and otherwise in the manner described in the Final Concerned Shareholders’ Circular.

The form of proxy to be provided by the Concerned Shareholders with the Final Concerned Shareholders’ Circular will confer discretionary authority upon the persons named therein to vote in the judgment of those persons in respect of amendments or variations, if any, which may properly come before the Meeting. As of the date of this Circular, the Concerned Shareholders know of no other matters to come before the Meeting other than as set forth herein. Should any other matters properly come before the Meeting, Shares represented by the relevant proxies will be voted on those matters in accordance with the judgment of the Concerned Shareholders’ representatives designated in the form of proxy to be provided by the Concerned Shareholders.

 

22


Non-Registered (Beneficial) Holders of Shares

Only registered holders of Shares, or the persons they appoint as their proxyholders, will be entitled to vote at the Meeting. However, in many cases, Shares beneficially owned by a holder (a “Non-Registered Holder”), are registered in the name of either:

 

  (a)

an intermediary (each an “Intermediary”) that the Non-Registered Holder deals with in respect of Shares. Intermediaries include banks, trust companies, securities dealers or brokers, and trustees or administrators of self-administered RRSPs, RRIFs, RESPs and similar plans; or

 

  (b)

a depository (such as CDS Clearing and Depository Services Inc. in Canada or The Depository Trust Company in the United States).

The Concerned Shareholders expect to make the Final Concerned Shareholders’ Circular and a form of proxy and/or voting instruction form available to the Intermediaries or their designates for distribution to Non-Registered Holders in connection with the Meeting once the Record Date (as defined below) has occurred. Intermediaries will be required to forward copies of the Final Concerned Shareholders’ Circular and any form of proxy or voting instruction form provided to them to Non-Registered Holders. The purpose of these procedures is to permit Non-Registered Holders to direct the voting of Shares they beneficially own. If you are a Non-Registered Holder and receive the Final Concerned Shareholders’ Circular or receive a form of proxy or voting instruction form on behalf of the Concerned Shareholders, please sign and return the form of proxy or voting instruction form in accordance with the directions provided by your Intermediary and set out in such form.

Without specific instructions, Intermediaries will be prohibited from voting Shares for their clients. Therefore, Non-Registered Holders should ensure that instructions respecting the voting of their Shares are communicated to the appropriate person by the appropriate time. A Non-Registered Holder cannot use a voting instruction form to vote Shares directly at the Meeting. Voting instructions must be returned sufficiently in advance of the Meeting to have those Shares voted. Further details will be set out in the applicable form of proxy or voting instruction form provided to Shareholders at the appropriate time. Each Intermediary has its own procedures which should be carefully followed by Non-Registered Holders to ensure that your Shares are voted by the Intermediary on your behalf at the Meeting. These procedures may allow for voting by telephone, via the Internet, by mail and/or by facsimile. The applicable instructions for each such method of voting will be set out in the form of proxy or voting instruction form provided to you directly by the Intermediary.

Non-Registered Holders will not have the automatic right to attend and vote their Shares directly at the Meeting. If you are a Non-Registered Holder and wish to attend and vote your Shares directly at the Meeting, you should contact your Intermediary and follow their instructions for completion and return of the form of proxy or voting instruction form provided to you directly by them, once received.

The majority of brokers and nominees in Canada and the United States now delegate responsibility for obtaining instructions from clients to Broadridge Investor Communications Solutions, Canada and its counterpart in the United States (“Broadridge”). Broadridge typically mails voting instruction forms to Non-Registered Holders and asks Non-Registered Holders to return the forms to Broadridge. Broadridge then tabulates the results of all instructions received and provides appropriate instructions respecting the voting of Shares to be represented at the Meeting. A Non-Registered Holder receiving a voting instruction form from Broadridge cannot use that form to vote Shares directly at the Meeting. The form must be returned to Broadridge well in advance of the Meeting in order to have the Shares voted.

A Non-Registered Holder will be entitled to revoke a form of proxy or voting instruction form given to an Intermediary at any time by written notice to the Intermediary in accordance with the instructions given to the Non-Registered Holder by its Intermediary.

The securityholder materials may be sent to both registered Shareholders and Non-Registered Holders. If you are a Non-Registered Holder, and the Concerned Shareholders or its agent sends the Final Concerned Shareholders’ Circular and other proxy materials directly to you, your name and address and information about your holdings of securities will have been obtained in accordance with applicable securities regulatory requirements from the Company or from the Intermediary holding the Shares on your behalf.

Further voting instructions will be provided in the Final Concerned Shareholders’ Circular.

 

23


Solicitation of Proxies

This solicitation is made by the Concerned Shareholders and is not made by or on behalf of management of the Company. Proxies for the Meeting may be solicited by mail, telephone, email or other electronic means as well as by newspaper or other media advertising, and in person by the Concerned Shareholders. In addition, the Concerned Shareholders may solicit proxies in reliance upon the public broadcast exemption to the solicitation requirements under applicable Canadian corporate and securities laws, conveyed by way of public broadcast, including through press releases, speeches or publications, and by any other manner permitted under applicable Canadian laws. The Concerned Shareholders may engage the services of one or more agents and authorize other persons to assist it in soliciting proxies on behalf of the Concerned Shareholders.

The Concerned Shareholders have retained Carson Proxy as an information agent and to assist in the solicitation of proxies on behalf of the Concerned Shareholders for use at the Meeting. The Concerned Shareholders anticipate the estimated cost of engaging Carson Proxy will be up to $125,000, plus the reimbursement of reasonable out-of-pocket expenses. The costs of solicitation by or on behalf of the Concerned Shareholders will be borne by the Concerned Shareholders.

The Concerned Shareholders’ proxy solicitation agent, Carson Proxy can be contacted by email at info@carsonproxy.com or by telephone at 1-800-530-5189 (toll-free) and 416-751-2066 (collect).

No person is authorized to give information or to make any representations other than those contained in this Circular and, if given or made, such information or representations must not be relied upon as having been authorized by the Concerned Shareholders to be given or made.

Meeting Information

The Court has ordered that the Meeting be held on May 14, 2021. Details with respect to the Meeting, including the location and time of the Meeting and, if held virtually, how to access the Meeting, will be included in the Management Circular, once filed. The Concerned Shareholders will also provide Shareholders with the Meeting details, once available, and any updates with respect to matters discussed herein at www.RestoreFSD.com.

OUTSTANDING SHARES AND PRINCIPAL HOLDERS

Shareholders Entitled to Vote

The Company has set April 14, 2021 as the record date for notice of the Meeting and for voting in respect of the Meeting (the “Record Date”). Each registered Shareholder and duly appointed and registered proxyholder is entitled to 276,660 votes per Class A Share held and one vote per Class B Share held as of the Record Date. According to the Company’s management’s discussion and analysis of financial condition and results of operations dated March 16, 2021 (the “March 16, 2021 MD&A”), 72 Class A Shares, 35,114,998 Class B Shares, options to purchase 1,628,013 Class B Shares and warrants to purchase 6,749,109 Class B Shares were issued and outstanding as of such date. Although currently unknown to the Concerned Shareholders, the number of outstanding Shares and the number of Shares entitled to be voted on each matter to be acted on at the Meeting will be determined as of the Record Date and is expected to be set out in a Management Circular, once filed.

Principal Holders

Information regarding the beneficial ownership, control or direction over Shares held by Shareholders other than the Concerned Shareholders is not within the knowledge of the Concerned Shareholders. For this information, please refer to the Management Circular, once filed, and other continuous disclosure filed by the Company on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.

 

24


As of the date of this Circular, the Share holdings of each of Mr. Saeed and Mr. Durkacz individually, as well as the Concerned Shareholders as a group, are as follows:

 

Name

 

Type of Ownership

  Number of Class A
Shares Owned
    Number of Class B
Shares Owned(1)
    Percentage of Total
Eligible Votes(1)
 

Zeeshan Saeed(2)

  Direct/Indirect     24       504,476       12.98

Anthony Durkacz(2)

  Direct/Indirect     24       450,058       12.88

Concerned Shareholders(2)

  Direct/Indirect     48       1,197,156       26.31

Notes:

 

(1)

On the basis of 72 Class A Shares and 35,114,998 Class B Shares outstanding as of March 16, 2021, according to the March 16, 2021 MD&A. Each Class A Share has 276,660 votes per share, and each Class B Share has one vote per share. Except as required by the OBCA or the Company’s articles of amendment, the holders of the Class A Shares and holders of the Class B Shares vote together as a single class on all matters at meetings of the Shareholders.

(2)

Information as at the date hereof, based on information provided by the Concerned Shareholders.

As of the date of this Circular, to the knowledge of the Concerned Shareholders, the Concerned Shareholders’ Nominees and their associates (other than the Concerned Shareholders) do not own, control or direct any Shares.

EXECUTIVE COMPENSATION, INDEBTEDNESS, MANAGEMENT CONTRACTS AND

EQUITY COMPENSATION PLANS

Except as otherwise disclosed in this Circular with respect to the Concerned Shareholders, information regarding: (i) the compensation of executives and directors of the Company (including the information prescribed by Form 51-102F6Statement of Executive Compensation); (ii) the indebtedness of the Company’s directors and officers or their respective associates to the Company or any of the Company’s subsidiaries; (iii) management contracts that may be in place at the Company; and (iv) securities authorized for issuance under the Company’s equity compensation plans is not within the knowledge of the Concerned Shareholders. For this information, please refer to the Company’s continuous disclosure documents and the Management Circular, once filed, on SEDAR at www.sedar.com and EDGAR at www.sec.gov.

To the knowledge of the Concerned Shareholders, none of the Concerned Shareholders’ Nominees, or any of their associates or affiliates, are or have been indebted, at any time since the beginning of the last completed financial year of FSD, to FSD or any of its subsidiaries or have indebtedness to another entity which is the subject of a guarantee, support agreement, letter of credit or similar arrangement or understanding provided by FSD or any of its subsidiaries.

INTEREST IN MATERIAL TRANSACTIONS AND MATTERS TO BE ACTED UPON

AT THE MEETING

Except as otherwise disclosed in this Circular, to the knowledge of the Concerned Shareholders, none of the Concerned Shareholders, the Concerned Shareholders’ Nominees or any associates or affiliates of the Concerned Shareholders or the Concerned Shareholders’ Nominees, have:

 

   

any material interest, direct or indirect, in any transaction since the beginning of the Company’s most recently completed financial year or in any proposed transaction that has materially affected or would materially affect the Company or any of its subsidiaries; or

 

   

any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, in any matter currently known to be acted upon at the Meeting other than the election of directors.

 

25


Prior to Mr. Latowsky becoming Chief Executive Officer of Canntab Therapeutics Ltd., Canntab Therapeutics Ltd. entered into agreements (the “Canntab Agreements”) with FSD and FV Pharma Inc. relating to the supply of cannabis products to Canntab Therapeutics Ltd. by FSD and for the use of certain facilities constructed by FSD in Cobourg, Ontario. While the Canntab Agreements remain in force, they are not material to the Company.

See “The Reason for this Circular” for information on Mr. Durkacz’s interest in the Strategic Transaction.

Except as disclosed above, information concerning any material interests, direct or indirect, of any director or executive officer of the Company, any other “informed person” (as such term is defined in National Instrument 51-102Continuous Disclosure Obligations), any person who, to the knowledge of the directors or officers of the Company, beneficially owns or exercises control or direction over securities carrying more than 10% of the voting rights attached to any class of outstanding voting securities of the Company or any associate or affiliate of any of the foregoing, in any transaction since the commencement of the Company’s most recently completed financial year or in any proposed transaction which has materially affected or would materially affect the Company or any of its subsidiaries, or in any matter to be acted upon at the Meeting, is not within the knowledge of the Concerned Shareholders. For this information, please refer to the Company’s continuous disclosure documents, and Management Circular, once filed, on SEDAR at www.sedar.com and EDGAR at www.sec.gov.

INFORMATION CONTAINED IN THIS CIRCULAR

Certain information concerning the Company contained in this Circular has been taken from or is based upon publicly available documents or records on file with Canadian securities regulatory authorities and other public sources. Although the Concerned Shareholders have no knowledge that would indicate that any statements contained in this Circular that are taken from or based upon those documents and records or other public sources are untrue or incomplete, the Concerned Shareholders do not assume and expressly disclaim any responsibility for the accuracy or completeness of the information taken from or based upon those documents, records and other public sources, or for any failure by the Company to publicly disclose events or facts that may have occurred or that may affect the significance or accuracy of any such information, but that are unknown to the Concerned Shareholders.

This Circular does not constitute an offer to sell, or a solicitation of an offer to purchase, any securities, or the solicitation of a proxy, by any person in any jurisdiction in which such an offer or solicitation is not authorized or in which the person making such offer or solicitation is not qualified to do so or to any person to whom it is unlawful to make such an offer or solicitation of an offer or proxy solicitation. The delivery of this Circular will not, under any circumstances, create an implication that there has been no change in the information set forth herein since the date as of which such information is given in this Circular.

INFORMATION REGARDING THE COMPANY

Additional information relating to the Company, including the Management Circular, once filed, can be found under the Company’s profile on SEDAR at www.sedar.com and on EDGAR at www.sec.gov. Financial information regarding the Company is provided in its audited financial statements and management’s discussion and analysis for its most-recently completed financial year, which can be found under the Company’s issuer profile on SEDAR and on EDGAR and on the Company’s website www.fsdpharma.com. In addition, a Shareholder may obtain copies of the Company’s financial statements and management’s discussion and analysis, by contacting the Company by mail at 1 Rossland Road West, Suite 202 Ajax, Ontario L1Z 1Z2 or by email at info@fsdpharma.com.

 

26


CERTIFICATE OF CONCERNED SHAREHOLDERS

Information contained in this Circular, unless otherwise indicated, is given as of the date hereof and the contents of this Circular are in compliance with Ont. Reg. 62 – General under the Business Corporations Act (Ontario). The contents and the sending of this Circular have been approved by Anthony Durkacz and Zeeshan Saeed on behalf of the Concerned Shareholders. A copy of this Circular has been sent to FSD Pharma Inc., each director of FSD Pharma Inc., each Shareholder whose proxy is being solicited and the auditor of FSD Pharma Inc.

March 17, 2021

 

By:  

(signed) Anthony Durkacz

  Name: Anthony Durkacz
By:  

(signed) “Zeeshan Saeed

  Name: Zeeshan Saeed


If you have any questions, please contact:

LOGO   

North American Toll Free Phone: 1-800-530-5189

 

Local (Collect outside North America): 416-751-2066

 

Email: info@carsonproxy.com

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