In the Matter of BZAM Ltd., 2025 CanLII 82449

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

(the Act)

AND

IN THE MATTER OF

BZAM LTD.

ORDER

(Section 144)

BACKGROUND

1. BZAM Ltd. (the Issuer) is subject to a failure-to-file cease trade order (the FFCTO) issued by the Ontario Securities Commission (the Principal Regulator) on May 7, 2024.

2. The Issuer has applied to the Principal Regulator pursuant to section 144 of the Securities Act (Ontario) for a partial revocation order of the FFCTO.

INTERPRETATION

3. Terms defined in National Instrument 14-101 Definitions or National Policy 11-207 Failure-to-File Cease Trade Orders and Revocations in Multiple Jurisdictions have the same meaning if used in this order, unless otherwise defined.

REPRESENTATIONS

4. This decision is based on the following facts represented by the Issuer:

(a) The Issuer was incorporated pursuant to the Canada Business Corporations Act, RSC 1985, c C-44 on November 16, 2016 under the name “The Green Organic Dutchman Holdings Ltd”. The Issuer later amended its articles on February 23, 2023 to change its name to “BZAM Ltd.”

(b) The Issuer is a reporting issuer in each of the provinces and territories of Canada.

(c) The mailing address, physical head office and registered office of the Issuer is located at 1995 Jerseyville Road West, Jerseyville, Ontario, L0R 1R0.

(d) The Issuer, through its operating and licensed subsidiary, is a Canadian cannabis producer, cultivator and retailer.

(e) The authorized share capital of the Issuer consists of an unlimited number of common shares (the Common Shares). As at the date hereof, there are 273,578,952 Common Shares outstanding. The Issuer has 7,097,233 stock options, 187,500 restricted share units, and 48,096,811 common share purchase warrants outstanding. Other than as set out herein, the Issuer has no other outstanding securities.

(f) The Common Shares were listed on the Canadian Securities Exchange (the CSE) under the symbol “BZAM” and on the OTCQX under the symbol “BZAMF”. The Issuer also had three classes of warrants listed on the CSE under the symbols “BZAM.WR”, “BZAM.WA” and “BZAM.WB”. The Issuer’s securities were delisted from trading on the CSE on September 11, 2024 in connection with the FFCTO. The Issuer intends to delist the Common Shares from the OTCQX following the completion of the Transaction (as defined herein).

(g) The FFCTO was issued as a result of the Issuer’s failure to file the following continuous disclosure materials as required by applicable Canadian securities laws:

(i) audited financial statements for the year ended December 31, 2023;

(ii) management’s discussion and analysis relating to the audited annual financial statements for the year ended December 31, 2023; and

(iii) certification of the foregoing filings as required by National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings (collectively, the Unfiled Documents).

(h) In addition to the Unfiled Documents, the Issuer has also not filed the following documents:

(i) interim financial statements for the three-month period ended March 31, 2024;

(ii) management's discussion and analysis relating to the interim financial statements for the three-month period ended March 31, 2024;

(iii) interim financial statements for the three and six-month period ended June 30, 2024;

(iv) management's discussion and analysis relating to the interim financial statements for the three and nine-month period ended September 30, 2024;

(v) interim financial statements for the three and nine-month period ended September 30, 2024;

(vi) management's discussion and analysis relating to the interim financial statements for the three and nine-month period ended September 30, 2024;

(vii) audited financial statements for the year ended December 31, 2024;

(viii) management’s discussion and analysis relating to the audited annual financial statements for the year ended December 31, 2024;

(ix) interim financial statements for the three-month period ended March 31, 2025;

(x) management's discussion and analysis relating to the interim financial statements for the three-month period ended March 31, 2025;

(xi) certification of the foregoing filings as required by National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings; and

(xii) the Issuer has not filed continuous disclosure documents required to be filed by applicable Canadian securities laws since the date of the FFCTO

(collectively, the Subsequent Unfiled Documents).

(i) On February 28, 2024, the Issuer and certain of its affiliates (collectively, the Applicants) commenced proceedings under the Companies’ Creditors Arrangement Act (the CCAA, and the proceedings related thereto, the CCAA Proceedings) pursuant to an initial order (as amended and restated, the Initial Order) granted by the Ontario Superior Court of Justice (Commercial List) (the Court). Pursuant to the Initial Order, the Court, inter alia, appointed FTI Consulting Canada Inc. as monitor of the Issuer under the CCAA Proceedings (in such capacity, the Monitor) and authorized an affiliate of the Issuer to obtain debtor-in-possession financing from Cortland Credit Lending Corporation, in the maximum amount of $41,000,000 in order to finance the Applicants’ working capital requirements and for other general corporate purposes and expenditures (the DIP Loan). The maximum amount permitted to be borrowed under the DIP Loan was later reduced by an order of the Court to $37,000,000. As of May 31, 2025, there is approximately $29,928,133 outstanding under the DIP Loan.

(j) On March 1, 2024, the Issuer and 1000816625 Ontario Inc. (the Purchaser) entered into a subscription agreement (the Subscription Agreement).

(k) On March 8, 2024, the Court granted an order (the SISP Order) authorizing the Monitor to conduct, with the assistance of the Issuer, a sale and investment solicitation process (the SISP) intended to solicit interest in the opportunity for a sale of or investment in substantially all of the property, assets and undertakings of the Applicants.

(l) On May 9, 2025, the Issuer and the Purchaser entered into an amended and restated share subscription agreement (the Amended Subscription Agreement).

(m) On May 15, 2025, the Court granted an order (the Approval and Reverse Vesting Order) pursuant to which, inter alia, it: (i) approved the Amended Subscription Agreement; (ii) authorized the vesting of all liabilities of the Applicants of any kind or nature whatsoever, other than certain assumed liabilities, in 1001105728 Ontario Inc. (ResidualCo) and releasing the Applicants from same; and (iii) authorized the completion of a reorganization transaction (the Transaction) partially comprised of the following steps:

(i) all equity interests, compensation plans and other securities in the Issuer shall be cancelled for no consideration;

(ii) the Issuer shall issue such number of Common Shares to the Purchaser as the Purchaser advises (collectively, the Restructured Shares) and the Purchaser shall subscribe for and purchase the Restructured Shares, such that the Purchaser shall become the sole securityholder of the Issuer; and

(iii) the Purchaser shall issue five percent of the Restructured Shares to Cortland Credit Lending Corporation (the Lender) and ten percent, in the aggregate, to certain members of the Issuer’s management team (the Management Group).

(n) Pursuant to the Approval and Reverse Vesting Order, having been advised of the provisions of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions relating to the requirement for “minority” shareholder approval in certain circumstances, the Court ordered that no shareholder approval or other approval is required to complete the Transaction.

(o) On July 24, 2025, the Issuer and the Purchaser entered into a second amended and restated share subscription agreement (the Second Amended Subscription Agreement).

(p) On July 30, 2025, the Court granted an order (the Amending Order) pursuant to which, inter alia, it: (i) approved certain minor amendments to the Amended Subscription Agreement, as reflected in the Second Amended Subscription Agreement; and (ii) approved certain corresponding amendments to the Approval and Reverse Vesting Order. The Transaction steps outlined above remain materially unchanged under the Second Amended Subscription Agreement.

(q) The Transaction will be completed in accordance with the Approval and Reverse Vesting Order, as amended by the Amending Order.

(r) In connection with carrying out the SISP Order and obtaining the Approval and Reverse Vesting Order and Amending Order, the Issuer engaged in certain acts in furtherance of trades in securities of the Issuer, including its entry into the Subscription Agreement, the Amended Subscription Agreement and the Second Amended Subscription Agreement (collectively, the Acts), which Acts were taken with the approval of, and under the supervision of, the Court. Under the SISP Order, the Court approved the Subscription Agreement "nunc pro tunc", meaning the Court's approval of entering into of the Subscription Agreement was retroactive to March 1, 2024. Under the Approval and Vesting Order, the Court approved the Amended Subscription Agreement, "nunc pro tunc", meaning the Court's approval of entering into of the Amended Subscription Agreement was retroactive to May 9, 2025. Under the Amending Order, the Court approved the Second Amended Subscription Agreement, "nunc pro tunc", meaning the Court's approval of entering into of the Second Amended Subscription Agreement was retroactive to July 24, 2025. Except for the Acts and the filing of the Unfiled Documents and the Subsequent Unfiled Documents, the Issuer is not in default of any requirements of the FFCTO, the securities legislation of any jurisdiction in which the Issuer is a reporting issuer (the Legislation), or the rules and regulations made pursuant thereto.

(s) As the Transaction will involve trades in securities of the Issuer, the closing of the Transaction requires the partial revocation of the FFCTO.

(t) The issuance of the Restructured Shares by the Issuer will occur in Ontario on a prospectus exempt basis pursuant to section 2.3 of National Instrument 45-106 Prospectus Exemptions.

(u) The Restructured Shares will not be qualified for distribution to the public under any applicable Canadian securities laws and will be subject to restrictions on transfer in Canada.

(v) Following completion of the Transaction, all securities of the Issuer will remain subject to the FFCTO until a full revocation of the FFCTO is granted.

(w) Other than for the Transaction, no further trading in securities of the Issuer will be made by the Issuer unless further relief for the FFCTO is sought by the Issuer or a full revocation of the FFCTO is granted.

(x) Following the completion of the Transaction, the Issuer intends to apply for a full revocation of the FFCTO and a cease to be a reporting issuer order.

(y) Pursuant to the Approval and Reverse Vesting Order, following the completion of the Transaction, the Monitor, for and on behalf of ResidualCo, will file an assignment in bankruptcy pursuant to the Bankruptcy and Insolvency Act (Canada).

(z) The Issuer’s SEDAR+ and SEDI profiles are up to date.

ORDER

5. The Principal Regulator is satisfied that a partial revocation order of the FFCTO meets the test set out in the Legislation for the Principal Regulator to make the decision.

6. The decision of the Principal Regulator under the Legislation is that the FFCTO is partially revoked solely to permit the trades in securities of the Issuer (including for greater certainty, acts in furtherance of trades in securities of the Issuer) that are necessary for and are in connection with the Transaction, provided that:

(a) prior to the completion of the Transaction, the Purchaser, the Lender and the Management Group will receive:

(i) a copy of the FFCTO;

(ii) a copy of this order; and

(iii) written notice from the Issuer, to be acknowledged by the Purchaser, the Lender and the Management Group in writing (the Acknowledgement), that all of the Issuer’s securities, including the securities issued in connection with the Transaction, will remain subject to the FFCTO unless further relief is granted or until a full revocation order is granted, the issuance of which is not certain and that the Issuer intends to apply to cease to be a reporting issuer immediately following closing of the Transaction.

(b) the Issuer undertakes to make available a copy of the Acknowledgement to staff of the Principal Regulator upon request; and

(c) this order will terminate on the earlier of:

(i) the completion of the Transaction; and

(ii) 60 days from the date hereof.

DATED this 19th day of August, 2025.

“Erin O’Donovan”

Erin O’Donovan

Associate Vice President, Corporate Finance

Ontario Securities Commission

OSC File # 2025/0380