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If any of the risks described in the Annual Report, the following risk factor, or any other risks and uncertainties that we have not yet identified or that we currently consider not to be material, actually occur or become material risks, our business, prospects, financial condition, results of operations and cash flows and consequently the price of our securities could be materially and adversely affected.
−Removed: strategy in part depends on the success of the PharmaCann Investment and there is no guarantee that we will exercise the PharmaCann Option in the near term, or at all, and, even if exercised, that the PharmaCann Investment will achieve the expected benefits of the transaction.
−Removed: Our ability to exercise the PharmaCann Option will depend on the satisfaction of several conditions, including U.S.
−Removed: federal cannabis legalization.
−Removed: In addition, our ability to exercise the PharmaCann Option is subject to the receipt of any required regulatory approvals, including in the states where PharmaCann operates that may be required upon exercise, as well as Altria’s approval under the Investor Rights Agreement.
−Removed: These conditions are outside of our control and therefore there can be no certainty that the PharmaCann Option will be exercised in the near term, or at all.
−Removed: If the PharmaCann Option is not exercised, we will not receive the benefits of the contemplated commercial arrangements between us and PharmaCann.
−Removed: In addition, the regulatory approval processes in connection with the exercise of any PharmaCann Option may take a prolonged period of time to complete, which could significantly delay our ability to exercise the PharmaCann Option and realize the benefits of the PharmaCann Investment, or result in our not being able to exercise all or part of the PharmaCann Option.
−Removed: Furthermore, in connection with obtaining approvals from or otherwise satisfying the requests of the state regulators or applicable laws, we may be required to divest all or a portion of the PharmaCann Option, or if after the exercise of the PharmaCann Option, our shares of PharmaCann.
−Removed: Even if we are able to and do exercise the PharmaCann Option, the intended benefits of the PharmaCann Investment may not be realized.
−Removed: We cannot assure you that the PharmaCann Investment will be accretive to us in the near term or at all.
−Removed: For example, if entered into, the commercial arrangements between us and PharmaCann may not be successful or beneficial to us.
−Removed: Furthermore, if we fail to realize the intended benefits of the PharmaCann Investment, our stock price could decline to the extent that the market price anticipates those benefits.
−Removed: We are entitled to certain limited governance rights with respect to PharmaCann, including limited information rights and board observer rights.
−Removed: Therefore, we will have little to no ability to influence the strategy and material decisions of PharmaCann’s business.
−Removed: Furthermore, until such time as we exercise the PharmaCann Option, we will not have the ability to vote on matters requiring the vote of PharmaCann’s shareholders and, until the exercise of the PharmaCann Option, will not have the right to appoint directors to the PharmaCann board of directors.
−Removed: Even after exercising the PharmaCann Option, we are entitled to appoint a director of PharmaCann’s board only if we continue to own at least 10% of the outstanding capital stock of PharmaCann, and in any event may appoint no more than two directors.
−Removed: In addition, we are subject to certain standstill restrictions, both prior to and after the exercise of the PharmaCann Option, which restrictions further limit our ability to influence decisions of PharmaCann.
−Removed: Subsequent Events to the Company’s condensed consolidated financial statements under Item 1.
−Removed: of this Quarterly Report for more information about the negative impact of the proposed merger with LivWell Holdings Inc.
−Removed: Although we are entitled to certain anti-dilution protections with respect to our investment in PharmaCann, such protections are subject to various conditions, and our potential ownership in PharmaCann may be significantly diluted by, among other things, future issuances of PharmaCann securities or bona fide acquisition activity in which PharmaCann uses its equity as consideration, including in respect of PharmaCann’s planned acquisition of LivWell Holdings, Inc.
−Removed: (“LivWell”) if and when that transaction is completed.
−Removed: On October 12, 2021, PharmaCann announced that it entered into a definitive merger agreement pursuant to which PharmaCann will acquire LivWell (the “LivWell Transaction”).
−Removed: Based upon the terms of the proposed merger, upon the closing of the proposed merger, our best estimate is that our ownership percentage in PharmaCann on a fully-diluted basis would decrease to approximately 6.7%.
−Removed: Under the terms of our investment in PharmaCann, Cronos’ rights to nominate an observer or a director to the PharmaCann board of directors could be lost if our ownership drops below 6% on a fully diluted basis and we sell or transfer all or any portion of the
−Removed: PharmaCann Option (subject to certain exceptions).
−Removed: As a result, further dilution could adversely affect our rights under the PharmaCann Option.
−Removed: The LivWell Transaction, and any other such activity could be significantly dilutive to our ownership in PharmaCann and may adversely impact the potential benefits we may realize from the PharmaCann Investment.
−Removed: We have been and may in the future be required to write down indefinite-lived intangible assets, due to impairment, which could have a material adverse effect on our results of operations or financial position
−Removed: The Company has been and may in the future be required to write down indefinite-lived intangible assets, due to impairment, which would reduce earnings.
−Removed: Indefinite-lived intangible assets are reviewed annually or more frequently when events or changes in circumstances indicate that the fair value of the indefinite-lived intangible assets have been reduced to less than their carrying amount.
−Removed: We periodically calculate the fair value of our indefinite-lived intangible assets to test for impairment.
−Removed: This fair value may be affected by several factors, including general economic conditions, regulatory developments, changes in category growth rates as a result of changing adult consumer preferences, success of planned new product introductions, and competitive activity.
−Removed: Certain events can also trigger an immediate review of indefinite-lived intangible assets.
−Removed: If the carrying amount of our indefinite-lived intangible assets exceeds their fair value, the indefinite-lived intangible assets are considered impaired, which would result in impairment losses and could have a material adverse effect on our consolidated financial position or results of operations.
−Removed: We cannot provide any assurance that the U.S.
−Removed: segment will successfully execute its business plans and strategies.
+Added: Our business, financial condition, results of operations and cash flows could be adversely affected by disruptions in the global economy caused by the ongoing conflict between Russia and Ukraine.
+Added: The global economy has been negatively impacted by the military conflict between Russia and Ukraine.
+Added: Furthermore, governments in the U.S., Canada United Kingdom, and European Union have each imposed export controls on certain products and financial and economic sanctions on certain industry sectors and parties in Russia.
+Added: Although we do not have any customers or direct supplier relationships in Russia or Ukraine, businesses in the United States and globally have experienced shortages in materials and increased costs for transportation, energy, and raw material due in part to the negative impact of the Russia-Ukraine military conflict on the global economy.
+Added: Further escalation of geopolitical tensions related to the military conflict, including increased trade barriers or restrictions on global trade, could result in, among other things, cyberattacks, supply disruptions, lower consumer demand, and changes to foreign exchange rates and financial markets, any of which may adversely affect our business, financial condition, results of operations and cash flows.
+Added: We are continuing to monitor the situation in Ukraine and globally and assessing its potential impact on our business.
+Added: Although our business has not been, to the date of this Quarterly Report, materially impacted by the ongoing military conflict in Ukraine, it is impossible to predict the extent to which our operations, or those of our suppliers and vendors, will be impacted in the short and long term, or the ways in which the conflict may impact our business.
+Added: The extent and duration of the military action, sanctions and resulting market disruptions are impossible to predict, but may be substantial.
+Added: In addition, the effects of the ongoing conflict could heighten any of our known risks described in our Annual Report.
Unregistered Sales of Equity Securities and Use of Proceeds.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.