Curaleaf makes changes to shares agreement as it looks to acquire Cura Partners

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The shift is designed to make the acquisition more equitable for all shareholders

In a deal in which Curaleaf absorbed Cura Partners, the original agreement was to hold a percentage of the shares, initially estimated at 15%, that was outstanding following the acquisition in one of the now more common lock-up agreements. This past Wednesday, the closing of this acquisition was finalized and Curaleaf announced that from Cura Partners — former owners of Select Brand — 5% of those applicable outstanding shares would be freed for sale during the last day of each of this year’s quarters, with the first sale to be held on March 31.

Involved in this agreement were all individuals that currently possess more than 1% of that outstanding portion of shares, and they all agreed to apply this modification. Based on released information, they cover 62% of all outstanding shares. The company doesn’t expect current shareholders to storm out as they “confirm their current intent to hold their shares despite the partial release from lockup.” This practice is quite new in the stock market and the lock-up period is designed to prevent insiders from selling shares during a certain defined period relevant to the initial public offering (IPO). In some cases, it has even become mandatory in an effort to protect the shares’ value from falling if there is a wave on stock sales.

According to Curaleaf, this latest change to the lock-up agreement “ensures the orderly increase in the Company’s freely traded shares and further reduces uncertainty regarding the release of shares.” The initial agreement has been modified two times before, last October and, prior to that, in March.