FSD Pharma Inc. Files 20-F Report for Fiscal Year Ended December 31, 2023

Ticker: QNTM · Form: 20-F · Filed: Apr 2, 2024 · CIK: 1771885

Fsd Pharma Inc. 20-F Filing Summary
FieldDetail
CompanyFsd Pharma Inc. (QNTM)
Form Type20-F
Filed DateApr 2, 2024
Risk Levelhigh
Pages15
Reading Time17 min
Key Dollar Amounts$1.00, $1, $1.3013
Sentimentmixed

Sentiment: mixed

Topics: FSD Pharma, 20-F Filing, Corporate Reorganization, Lawsuit, Share Restructuring

TL;DR

<b>FSD Pharma Inc. reported its 2023 fiscal year-end results, detailing a significant corporate reorganization and ongoing legal proceedings.</b>

AI Summary

FSD Pharma Inc. (QNTM) filed a Foreign Annual Report (20-F) with the SEC on April 2, 2024. FSD Pharma Inc. completed a Plan of Arrangement reorganization, cancelling existing shares and warrants and reissuing new ones. The company reissued 24 new Class B shares and 48 new Class A shares, while cancelling 39,376,699 Class B shares. FSD Pharma Inc. also cancelled and reissued 6,335,758 FSD Pharma New Distribution Warrants. Holders of Class A shares are entitled to 276,660 votes per share. GBB Drink Lab, Inc. filed a complaint against FSD Pharma Inc. for breach of contract and misappropriation of trade secrets, valued at $53,047,000.

Why It Matters

For investors and stakeholders tracking FSD Pharma Inc., this filing contains several important signals. The extensive share restructuring and warrant reissuance indicate a move towards simplifying the company's capital structure, potentially to attract new investment or prepare for future growth initiatives. The ongoing lawsuit from GBB Drink Lab, Inc. poses a significant financial and reputational risk, with potential damages claimed at over $53 million.

Risk Assessment

Risk Level: high — FSD Pharma Inc. shows elevated risk based on this filing. The company faces a high risk due to a lawsuit filed by GBB Drink Lab, Inc. claiming $53,047,000 in damages for breach of contract and misappropriation of trade secrets.

Analyst Insight

Investors should monitor the outcome of the GBB Drink Lab lawsuit and the impact of the recent share restructuring on FSD Pharma's operational and financial performance.

Key Numbers

  • 276,660 — Votes per Class A share (Holders of Class A shares are entitled to this many votes per share.)
  • 24 — New Class B shares (Number of new Class B shares reissued after reorganization.)
  • 48 — New Class A shares (Number of new Class A shares reissued after reorganization.)
  • 39,376,699 — Cancelled Class B shares (Number of Class B shares cancelled during the reorganization.)
  • 6,335,758 — Cancelled FSD Pharma New Distribution Warrants (Number of warrants cancelled and reissued.)

Key Players & Entities

  • FSD Pharma Inc. (company) — Filer of the 20-F report
  • GBB Drink Lab, Inc. (company) — Plaintiff in a lawsuit against FSD Pharma Inc.
  • United States District Court of Southern District of Florida (company) — Court where GBB Drink Lab, Inc. filed its complaint
  • $53,047,000 (dollar_amount) — Valuation of damages claimed by GBB Drink Lab, Inc.
  • Plan of Arrangement (other) — Type of reorganization completed by FSD Pharma Inc.

FAQ

When did FSD Pharma Inc. file this 20-F?

FSD Pharma Inc. filed this Foreign Annual Report (20-F) with the SEC on April 2, 2024.

What is a 20-F filing?

A 20-F is a annual report for foreign private issuers, equivalent to a 10-K but following international reporting standards. This particular 20-F was filed by FSD Pharma Inc. (QNTM).

Where can I read the original 20-F filing from FSD Pharma Inc.?

You can access the original filing directly on the SEC's EDGAR system. The filing is publicly available and includes all exhibits and attachments submitted by FSD Pharma Inc..

What are the key takeaways from FSD Pharma Inc.'s 20-F?

FSD Pharma Inc. filed this 20-F on April 2, 2024. Key takeaways: FSD Pharma Inc. completed a Plan of Arrangement reorganization, cancelling existing shares and warrants and reissuing new ones.. The company reissued 24 new Class B shares and 48 new Class A shares, while cancelling 39,376,699 Class B shares.. FSD Pharma Inc. also cancelled and reissued 6,335,758 FSD Pharma New Distribution Warrants..

Is FSD Pharma Inc. a risky investment based on this filing?

Based on this 20-F, FSD Pharma Inc. presents a elevated-risk profile. The company faces a high risk due to a lawsuit filed by GBB Drink Lab, Inc. claiming $53,047,000 in damages for breach of contract and misappropriation of trade secrets.

What should investors do after reading FSD Pharma Inc.'s 20-F?

Investors should monitor the outcome of the GBB Drink Lab lawsuit and the impact of the recent share restructuring on FSD Pharma's operational and financial performance. The overall sentiment from this filing is mixed.

Risk Factors

  • GBB Drink Lab Lawsuit [high — legal]: GBB Drink Lab, Inc. has filed a complaint alleging material breach of a non-disclosure agreement and misappropriation of trade secrets, seeking $53,047,000 in damages.
  • Net Operating Loss Carryforwards Limitation [medium — financial]: Utilization of net operating loss carryforwards may be subject to limitations under IRC § 382 due to potential changes in ownership, such as the acquisition of Prismic.

Key Dates

  • 2023-12-31: Fiscal Year End — Reporting period for the 20-F filing.
  • 2024-04-02: Filing Date — Date the 20-F report was filed with the SEC.

Filing Stats: 4,359 words · 17 min read · ~15 pages · Grade level 14.7 · Accepted 2024-04-01 21:22:13

Key Financial Figures

  • $1.00 — U.S. dollars were made at the rate of US$1.00 to C$1.3497, which is the average rate
  • $1 — rs were made at the rate of US$1.00 to C$1.3497, which is the average rate for the
  • $1.3013 — scal year, (2022 average rate: US$1.00=C$1.3013). Such U.S. dollar amounts are not nece

Filing Documents

Item 18

Item 17 Item 18 If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No TABLE OF CONTENTS INTRODUCTION 6

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS 6 MARKET AND INDUSTRY DATA 9 SUMMARY RISK FACTORS 10 PART I 11 Item 1. Identity of Directors, Senior Management and Advisers . 11 Item 2. Offer Statistics and Expected Timetable . 11 Item 3. Key Information. 11 A. [Reserved] 11 B. Capitalization and Indebtedness 11 C. Reasons for the Offer and Use of Proceeds 11 D.

Risk Factors

Risk Factors 11 Item 4. Information on the Company. 29 A. History and Development of the Company 29 B. Business Overview 34 C. Organizational Structure 46 D. Property, Plants and Equipment 48 Item 4A. Unresolved Staff Comments. 48 Item 5. Operating and Financial Review and Prospects. 48 A. Operating Results 48 B. Liquidity and Capital Resources 48 C. Research and Development, Patents and Licenses, etc. 48 D. Trend Information 48 E. Critical Accounting Estimates 48 Item 6. Directors, Senior Management and Employees. 48 A. Directors and Senior Management 48 B. Compensation 51 C. Board Practices 59 D. Employees 65 E. Share Ownership 65 3 Table of Contents Item 7. Major Shareholders and Related Party Transactions. 65 A. Major Shareholders 65 B. Related Party Transactions 67 C. Interests of Experts and Counsel 68 Item 8. Financial Information. 68 A. Consolidated Statements and Other Financial Information 68 B. Significant Changes 71 Item 9. The Offer and Listing. 71 A. Offer and Listing Details B. Plan of Distribution 71 C. Markets 71 D. Selling Shareholders 71 E.

Dilution

Dilution 71 F. Expenses of the Issue 71 Item 10. Additional Information. 72 A. Share Capital 72 B. Memorandum and Articles of Association 72 C. Material Contracts 72 D. Exchange Controls 72 E. Taxation 73 F. Dividends and Paying Agents 79 G. 79 H. Documents on Display 79 I. Subsidiary Information 79 J. Annual Report to Security Holders 79 Item 11.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk. 79 Item 12.

Description of Securities Other than Equity Securities

Description of Securities Other than Equity Securities. 79 A. Debt Securities 79 B. Warrants and Rights 79 C. Other Securities 79 D. American Depositary Shares 79 PART II Item 13. Defaults, Dividend Arrearages and Delinquencies. 80 4 Table of Contents Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds. 80 A.-D. 80 E.

Use of Proceeds

Use of Proceeds 80 Item 15.

Controls and Procedures

Controls and Procedures 82 A. Disclosure Controls and Procedures 82 B. Management's Annual Report on Internal Control over Financial Reporting 82 C. Attestation Report of the Registered Public Accounting Firm 82 D. Changes in Internal Control Over Financial Reporting 82 Item 16. [Reserved.] 82 Item 16A. Audit Committee Financial Expert. 82 Item 16B. Code of Ethics. 83 Item 16C. Principal Accountant Fees and Services. 83 Item 16D. Exemptions from the Listing Standards for Audit Committees. 83 Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers. 83 Item 16F. Change in Registrant's Certifying Accountant. 85 Item 16G. Corporate Governance. 86 Item 16H. Mine Safety Disclosure. 86 Item 16I. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections. 86 Item 16J. Insider Trading Policies. 86 Item 16K. Cybersecurity. 86 PART III Item 17.

Financial Statements

Financial Statements. 88 Item 18.

Financial Statements

Financial Statements. 88 Item 19. Exhibits. 88 5 Table of Contents INTRODUCTION Unless otherwise noted or the context otherwise requires, all references in this Annual Report on Form 20-F (this " Annual Report "), or this Annual Report, to "FSD," "FSD Pharma," "Company," "Corporation," "we," "us" and "our" refer to FSD Pharma Inc., a corporation formed under the Business Corporations Act (Ontario) (the " OBCA ") and the direct or indirect subsidiary entities of FSD and any partnership interests held by FSD Pharma and its subsidiary entities, including Lucid Psycheceuticals Inc. (" Lucid "), FSD BioSciences Inc. (" FSD Biosciences "), FV Pharma Inc. (" FV Pharma "), Prismic Pharmaceuticals, Inc. (" Prismic "), FSD Strategic Investments Inc. (" FSD Strategic Investments "), FSD Pharma Australia Pty Ltd. (" FSD Australia ") and Celly Nutrition Corp. (" Celly Nu "). Our fiscal year ends on December 31. This Annual Report includes our audited consolidated financial statements as of December 31, 2023 and 2022 and for the years ended December 31, 2023 and 2022, (the " 2023 Annual Financial Statements ") which are prepared in accordance with International Financial Reporting Standards (" IFRS ") as issued by the International Accounting Standards Board. None of our financial statements were prepared in accordance with generally accepted accounting principles in the United States of America (" U.S. GAAP "). Except where expressly indicated otherwise, our financial information is presented in U.S. dollars. All references in this Annual Report to "

quot; or "US
quot; mean United States of American (" U.S. " or " United States ") dollars, and all references in this Annual Report to "C
quot; mean Canadian dollars. For the convenience of the reader, in this Annual Report, unless otherwise indicated, translations from Canadian dollars into U.S. dollars were made at the rate of US$1.00 to C$1.3497, which is the average rate for the 2023 fiscal year, (2022 average rate: US$1.00=

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