Documente Academic
Documente Profesional
Documente Cultură
20,000,000 Shares
Thisistheinitialpublicofferingofoursubordinatevotingshares.Weareoffering6,308,154subordinatevotingshares,andthesellingshareholdersnamedinthisprospectus,includingour
principalshareholders,areoffering,intheaggregate13,691,846subordinatevotingshares.Wewillnotreceiveanyproceedsfromthesubordinatevotingsharessoldbythesellingshareholders.
TheinitialpublicofferingpriceisC$17.00persubordinatevotingshare.
Nopublicmarketcurrentlyexistsforoursubordinatevotingshares.OursubordinatevotingshareshavebeenapprovedforlistingontheNewYorkStockExchangeintheUnitedStatesand
conditionallyapprovedforlistingontheTorontoStockExchangeinCanadaunderthesymbolGOOS.
Followingthisoffering,wewillhavetwoclassesofsharesoutstanding:multiplevotingsharesandsubordinatevotingshares.Therightsoftheholdersofourmultiplevotingsharesand
subordinatevotingsharesaresubstantiallyidentical,exceptwithrespecttovotingandconversion.Thesubordinatevotingshareswillhaveonevotepershareandthemultiplevotingshareswill
have10votespershare.Thesubordinatevotingsharesarenotconvertibleintoanyotherclassofshares,whilethemultiplevotingsharesareconvertibleintosubordinatevotingsharesonaone-
for-onebasisattheoptionoftheholderandundercertainothercircumstances,includingatthetimeoursignificantshareholdersrespectivelyceasetohold15%ofthetotalnumberofmultiple
votingsharesandsubordinatevotingsharesoutstanding.SeeDescriptionofShareCapital.Aftergivingeffecttothesaleofthesubordinatevotingsharesofferedhereby,thesubordinatevoting
shareswillcollectivelyrepresentapproximately19%ofourtotalissuedandoutstandingsharesand2%ofthevotingpowerattachedtoallofourissuedandoutstandingshares(22%and3%,
respectively,iftheunderwritersover-allotmentoptionisexercisedinfull)andthemultiplevotingshareswillcollectivelyrepresentapproximately81%ofourtotalissuedandoutstanding
sharesand98%ofthevotingpowerattachedtoallofourissuedandoutstandingshares(78%and97%,respectively,iftheunderwritersover-allotmentoptionisexercisedinfull).See
DescriptionofShareCapitalAuthorizedShareCapital.
We are eligible to be treated as an emerging growth company as defined in Section 2(a) of the Securities Act of 1933 and, as a result, are subject to reduced public company
reporting requirements. See Prospectus SummaryImplications of Being an Emerging Growth Company and a Foreign Private Issuer.
Following this offering, we will be a controlled company within the meaning of the corporate governance rules of the New York Stock Exchange. See ManagementDirector
Independence.
Investing in our subordinate voting shares involves risk. See Risk Factors beginning on page 17.
Per
share Total
Initialpublicofferingprice C$ 17.00 C$340,000,000
Underwritingcommissions(1) C$ 1.1475 C$ 22,950,000
Proceedstous,beforeexpenses C$ 15.8525 C$100,000,011
Proceedstothesellingshareholders,beforeexpenses C$ 15.8525 C$217,049,989
(1) Wehaveagreedtoreimbursetheunderwritersforcertainexpensesinconnectionwiththisoffering.SeeUnderwritingforadditionalinformationregardingunderwritingcompensation.
Totheextentthattheunderwriterssellmorethan20,000,000subordinatevotingshares,theunderwritershavetheoptiontopurchaseuptoanaggregateof3,000,000additionalsubordinate
votingsharesfromthesellingshareholdersattheinitialpublicofferingprice,lesstheunderwritingcommissions,for30daysafterthedateofthisprospectussolelytocoverover-allotments.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed on the adequacy or accuracy of this
prospectus. Any representation to the contrary is a criminal offense.
TheunderwritersexpecttodeliverthesubordinatevotingsharestoinvestorsonoraboutMarch21,2017.
CIBC Capital Markets Credit Suisse Goldman, Sachs & Co. RBC Capital Markets
BofA Merrill Lynch Morgan Stanley Barclays BMO Capital Markets TD Wells Fargo Securities
Baird Canaccord Genuity
Prospectus dated March 15, 2017
Table of Contents
Table of Contents
Table of Contents
Table of Contents
Table of Contents
Table of Contents
Table of Contents
Page
ProspectusSummary 1
TheOffering 8
SummaryHistoricalConsolidatedFinancialandOtherData 11
RiskFactors 17
ExchangeRateInformation 40
UseofProceeds 41
DividendPolicy 42
Recapitalization 43
Capitalization 44
Dilution 45
SelectedHistoricalConsolidatedFinancialData 47
ManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperations 50
LetterfromDaniReiss 76
Business 77
Management 92
ExecutiveCompensation 103
CertainRelationshipsandRelatedPartyTransactions 114
PrincipalandSellingShareholders 117
DescriptionofIndebtedness 119
DescriptionofShareCapital 126
ComparisonofShareholderRights 137
SharesEligibleforFutureSale 151
MaterialUnitedStatesFederalIncomeTaxConsiderationsforU.S.Holders 153
CanadianTaxImplicationsForNon-CanadianHolders 159
Underwriting 161
LegalMatters 168
Experts 168
EnforcementofCivilLiabilities 168
OtherExpensesofIssuanceandDistribution 169
WhereYouCanFindMoreInformation 169
IndextoConsolidatedFinancialStatementsandFinancialStatementSchedules F-1
We are responsible for the information contained in this prospectus and in any free writing prospectus we prepare or authorize. Neither we, the selling
shareholders nor the underwriters have authorized anyone to provide you with different information, and neither we, the selling shareholders nor the
underwriters take responsibility for any other information others may give you. We are not, and the selling shareholders and underwriters are not,
making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. The information in this prospectus is only accurate as of
the date of this prospectus. Our business, financial condition, results of operations and prospects may have changed since that date.
i
Table of Contents
obtaineddatathatwebelievetobereliable.InformationinthisprospectusontheouterwearandluxuryapparelmarketsisfromEuromonitorApparelandFootwear
2017editionandEuromonitorLuxuryGoods2017edition,whichisindependentmarketresearchcarriedoutbyEuromonitorInternationalLimited.Researchby
EuromonitorInternationalshouldnotbeconsideredastheopinionofEuromonitorInternational,astothevalueofanysecurityortheadvisabilityofinvestingin
thecompany.TheEuromonitordataisreportedinU.S.Dollarsandincludessalestaxesatcurrentprices.Outerwearincludesmensandwomensclothingfor
outdoor/out-of-the-housewearincludingshortsandtrousers,jeans,jacketsandcoats,suits,shirtsandblouses,jumpers,tops,dresses,skirtsandleggings.Luxury
ApparelisequivalenttoDesignerApparel(Ready-to-Wear)whichistheaggregationofMensDesignerApparel,WomensDesignerApparel,Designer
Childrenswear,DesignerApparelAccessoriesandDesignerHosiery.However,designerhautecoutureisexcludedfromEuromonitorInternationals
coverage.Somemarketandindustrydata,andstatisticalinformationandforecasts,arealsobasedonmanagementsestimates,whicharederivedfromourreview
ofcustomersurveyscommissionedbyusandconductedonourbehalfaswellastheindependentsourcesreferredtoabove.Anysuchmarketdata,informationor
forecastmayprovetobeinaccuratebecauseofthemethodbywhichweobtainitorbecauseitcannotalwaysbeverifiedwithcompletecertaintygiventhelimitson
theavailabilityandreliabilityofrawdata,thevoluntarynatureofthedatagatheringprocessandotherlimitationsanduncertainties,includingthosediscussedunder
thecaptionsRiskFactors.Asaresult,althoughwebelievethatthesesourcesarereliable,wehavenotindependentlyverifiedtheinformation.
Solelyforconvenience,thetrademarks,servicemarksandtradenamesreferredtointhisprospectusarelistedwithoutthe,(sm)and(TM)symbols,butwewill
assert,tothefullestextentunderapplicablelaw,ourrightsortherightsoftheapplicablelicensorstothesetrademarks,servicemarksandtradenames.
Basis of Presentation
Unlessotherwiseindicated,allreferencesinthisprospectustoCanadaGoose,we,our,us,thecompanyorsimilartermsrefertoCanadaGooseHoldings
Inc.anditsconsolidatedsubsidiaries.
WepublishourconsolidatedfinancialstatementsinCanadiandollars.Inthisprospectus,unlessotherwisespecified,allmonetaryamountsareinCanadiandollars,
allreferencesto$,C$,CDN$,CAD$,anddollarsmeanCanadiandollarsandallreferencestoUS$andUSDmeanU.S.dollars.
OnDecember9,2013,investmentfundsadvisedbyBainCapitalL.P.anditsaffiliates,whichwerefertoasBainCapital,acquiredamajorityequityinterestinour
business.WerefertothisastheAcquisition.Accordingly,thefinancialstatementspresentedelsewhereinthisprospectusasofandforfiscal2014reflectthe
periodsbothpriorandsubsequenttotheAcquisition.Theconsolidatedfinancialstatementsasatandforfiscal2014arepresentedseparatelyfor(i)thepredecessor
periodfromApril1,2013throughDecember8,2013,whichwerefertoasthePredecessor2014Period,and(ii)thesuccessorperiodfromDecember9,2013
throughMarch31,2014,whichwerefertoastheSuccessor2014Period,withtheperiodspriortotheAcquisitionbeinglabeledaspredecessorandtheperiods
subsequenttotheAcquisitionlabeledassuccessor.Forthepurposeofperformingacomparisontofiscal2015,wehavepreparedUnauditedProFormaCombined
SupplementalFinancial
ii
Table of Contents
Informationforfiscal2014,whichgiveseffecttotheAcquisitionasifithadoccurredonApril1,2013,andwhichwerefertoastheUnauditedProForma
Combined2014Period.SeeManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperationsBasisofPresentation.
Inconnectionwiththisoffering,weredesignatedourClassAcommonsharesintomultiplevotingshares.Inaddition,weeliminatedallofourpreviously
outstandingseriesofcommonandpreferredsharesandcreateoursubordinatevotingshareswhichwillbeissuedinthisoffering.SeeDescriptionofShare
Capital.Thesubordinatevotingsharestobesoldbythesellingshareholdersholdingmultiplevotingsharesaspartoftheofferingwillresultfromtheconversion
ofmultiplevotingsharesintosubordinatevotingsharespriortotheclosingoftheoffering.
WereportunderInternationalFinancialReportingStandards(IFRS)asissuedbytheInternationalAccountingStandardsBoard(theIASB).Noneofthe
financialstatementswerepreparedinaccordancewithgenerallyacceptedaccountingprinciplesintheUnitedStates.OurfiscalyearendsonMarch31ofeach
calendaryear.Ourmostrecentfiscalyear,whichwerefertoasfiscal2016,endedonMarch31,2016.WerefertotheyearendedMarch31,2015andthe
UnauditedProFormaCombined2014Periodasfiscal2015andfiscal2014,respectively.
iii
Table of Contents
Prospectus Summary
This summary highlights certain information contained elsewhere in this prospectus. This summary does not contain all of the information you should
consider before investing in our subordinate voting shares. You should read this entire prospectus carefully, especially the Risk Factors section of this
prospectus and our consolidated financial statements and related notes appearing elsewhere in this prospectus, before making an investment decision.
Canada Goose
Founded60yearsagoinasmallTorontowarehouse,CanadaGoosehasgrownintoahighlycovetedglobalouterwearbrand.Wearerecognizedforauthentic
heritage,uncompromisedcraftsmanshipandquality,exceptionalwarmthandsuperiorfunctionality.Thisreputationisdecadesinthemakingandisrootedin
ourcommitmenttocreatingpremiumproductsthatdeliverunrivaledfunctionalitywhereandwhenitisneededmost.BeitCanadianArcticRangersserving
theircountryoranexplorertrekkingtotheSouthPole,peoplewholive,workandplayintheharshestenvironmentsonEarthhaveturnedtoCanadaGoose.
Throughoutourhistory,wehavefoundinspirationinthesetechnicalchallengesandparlayedthatexpertiseintocreatingexceptionalproductsforany
occasion.FromresearchfacilitiesinAntarcticaandtheCanadianHighArctictothestreetsofToronto,NewYorkCity,London,Paris,Tokyoandbeyond,
peoplehavefalleninlovewithourbrandandmadeitapartoftheireverydaylives.
Wearedeeplyinvolvedineverystageofourbusinessasadesigner,manufacturer,distributorandretailerofpremiumouterwearformen,womenand
children.Thisverticallyintegratedbusinessmodelallowsustodirectlycontrolthedesignanddevelopmentofourproductswhilecapturinghighermargins.
AsofDecember31,2016,ourproductsaresoldthroughselectoutdoor,luxuryandonlineretailersanddistributorsin36countries,oure-commercesitesin
Canada,theUnitedStates,theUnitedKingdomandFranceandtworecentlyopenedretailstoresinTorontoandNewYorkCity.
Thepowerofourbusinessmodelandourabilitytoprofitablyscaleouroperationsarereflectedinourfinancialperformance.Infiscal2016,wehadrevenueof
$290.8million,grossprofitof$145.6million,whichrepresentedgrossmarginof50.1%,netincomeof$26.5million,AdjustedEBITDAof$54.3million,
AdjustedEBITDAMarginof18.7%andAdjustedNetIncomeof$30.1million.Wegrewourrevenueata38.3%compoundannualgrowthrate(CAGR),
netincomeata196.0%CAGRandAdjustedEBITDAatan85.0%CAGRfromfiscal2014tofiscal2016,whileexpandingourgrossmarginfrom38.6%to
50.1%andourAdjustedEBITDAMarginfrom10.4%to18.7%overthesameperiod.ForadditionalinformationregardingAdjustedEBITDA,Adjusted
EBITDAMarginandAdjustedNetIncome,whicharenon-IFRSmeasures,includingareconciliationofthesenon-IFRSmeasurestonetincome,see
ManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperationsNon-IFRSMeasures.
1
Table of Contents
2
Table of Contents
Total
$152.1
$218.4
$290.8
38.3%
Canada. WhilewehaveachievedhighbrandawarenessinCanada,wecontinuetoexperiencestrongpenetrationandrevenuegrowthdrivenprimarily
byexpandingaccessandproductofferings.After
developingastrongwholesalefootprint,wesuccessfullylaunchedourCanadiane-commerceplatforminAugust2014andopenedourfirstretailstore
inTorontoinOctober2016.Weexpecttofurtherdevelopourpresencethroughincreasedstrategicmarketingactivities,deeperrelationshipswithour
retailpartnersandcontinuedfocusonourDTCchannel.Additionally,weintendtocontinuebroadeningourproductofferingtomakeCanadaGoosea
biggerpartofourcustomerslives.
3
Table of Contents
4
Table of Contents
Corporate Information
OurcompanywasfoundedinToronto,Canadain1957.InDecember2013,wepartneredwithBainCapitalthroughasaleofa70%equityinterestinour
businesstoaccelerateourgrowth.Inconnectionwithsuchsale,CanadaGooseHoldingsInc.wasincorporatedundertheBusinessCorporationsAct(British
Columbia)onNovember21,2013.
Ourprincipalofficeislocatedat250BowieAvenue,Toronto,Ontario,CanadaM6E4Y2andourtelephonenumberis(416)780-9850.Ourregisteredoffice
islocatedatSuite1700,ParkPlace,666BurrardStreet,Vancouver,BritishColumbia,Canada,V6C2X8.Ourwebsiteaddressiswww.canadagoose.com.
Informationcontainedon,oraccessiblethrough,ourwebsiteisnotapartofthisprospectusandtheinclusionofourwebsiteaddressinthisprospectusisan
inactivetextualreference.
Sponsor Overview
BainCapitalL.P.isoneoftheworldsleadingprivate,multi-assetalternativeinvestmentfirmswithoverUS$75billionofassetsundermanagement.Bain
Capitalinvestsacrossassetclassesincludingprivateequity,credit,publicequityandventurecapital,andleveragesitssharedplatformtocaptureopportunities
initsstrategicareasoffocus.Currently,BainCapitalhasateamofnearly400investmentprofessionalssupportingitsvariousassetclasses.Headquarteredin
Boston,BainCapitalhasofficesinNewYork,Chicago,PaloAlto,SanFrancisco,London,Dublin,Munich,HongKong,Tokyo,Shanghai,Mumbai,Sydney
andMelbourne.
Since1984,BainCapitalPrivateEquityhasmadenearly300investmentsinavarietyofindustriesaroundtheworld.Thefirmhasalongandsuccessful
historyofinvestinginconsumerproductsandretailbusinessesandhasadedicatedgroupofinvestmentprofessionalsfocusedonthesector.BainCapital
PrivateEquityhashelpedtobuildandscalemanyleadingbrands,includingBurlingtonStores,Samsonite,Staples,SundialBrandsandTOMSintheU.S.and
EuropeaswellasDollarama,BRPandShoppersDrugMartinCanada.
Aftergivingeffecttothesaleofsubordinatevotingsharesofferedhereby,BainCapitalwillcontrolapproximately70%ofourmultiplevotingshares,or
approximately68%ofthecombinedvotingpowerofour
5
Table of Contents
multiplevotingsharesandsubordinatevotingsharesoutstandingafterthisoffering(68%iftheunderwritersover-allotmentoptionisexercisedinfull).Asa
result,weexpecttobeacontrolledcompanywithinthemeaningofthecorporategovernancestandardsoftheNewYorkStockExchange(theNYSE)on
whichoursubordinatevotingshareshavebeenapprovedforlisting.SeeRiskFactorsRisksRelatedtoThisOfferingandOurSubordinateVotingShares.
Risk Factors
Investinginoursubordinatevotingsharesinvolvesahighdegreeofrisk.YoushouldcarefullyconsidertherisksdescribedinRiskFactorsbeforemakinga
decisiontoinvestinoursubordinatevotingshares.Ifanyoftheserisksactuallyoccur,ourbusiness,financialconditionandresultsofoperationswouldlikely
bemateriallyadverselyaffected.Insuchcase,thetradingpriceofoursubordinatevotingshareswouldlikelydeclineandyoumaylosepartorallofyour
investment.Belowisasummaryofsomeoftheprincipalrisksweface:
wemaybeunabletomaintainthestrengthofourbrand;
wemaynotbeabletomanageourgrowtheffectively;
ourbrandexpansionplansmaybeunsuccessful;
fluctuationsinrawmaterialscostsorcurrencyexchangeratesmayimpactouroperatingresults;and
ourdual-classsharestructureconcentratesvotingcontrolwithourprincipalshareholdersandasaresultourprincipalshareholderswillhavethe
abilitytocontroltheoutcomeofmatterssubmittedforshareholderapprovalandmayhaveintereststhatdifferfromthoseofourother
shareholders.
TheJOBSActalsopermitsanemerginggrowthcompanysuchasustotakeadvantageofanextendedtransitionperiodtocomplywithneworrevised
accountingstandardsapplicabletopubliccompanies.WewillnottakeadvantageofthisprovisionbecauseIFRSstandardsmakenodistinctionbetweenpublic
andprivatecompaniesforpurposesofcompliancewithneworrevisedaccountingstandards.
Wewillremainanemerginggrowthcompanyuntiltheearliestof:
thelastdayofourfiscalyearduringwhichwehavetotalannualgrossrevenueofatleastUS$1.0billion;
thelastdayofourfiscalyearfollowingthefifthanniversaryofthecompletionofthisoffering;
thedateonwhichwehave,duringthepreviousthree-yearperiod,issuedmorethanUS$1.0billioninnon-convertibledebtsecurities;or
6
Table of Contents
thedateonwhichwearedeemedtobealargeacceleratedfilerundertheU.S.SecuritiesExchangeActof1934,asamended,ortheExchange
Act,whichwouldoccurifthemarketvalueofoursharesthatareheldbynon-affiliatesexceedsUS$700millionasofthelastbusinessdayofour
mostrecentlycompletedsecondfiscalquarter.
Inaddition,uponconsummationofthisoffering,wewillreportundertheExchangeAct,asanon-U.S.companywithforeignprivateissuerstatus.Asa
foreignprivateissuer,wemaytakeadvantageofcertainprovisionsintheNYSEListingRulesthatallowustofollowCanadianlawforcertaincorporate
governancematters.SeeManagementForeignPrivateIssuerStatus.Evenafterwenolongerqualifyasanemerginggrowthcompany,aslongaswe
qualifyasaforeignprivateissuerundertheExchangeAct,wewillbeexemptfromcertainprovisionsoftheExchangeActthatareapplicabletoU.S.domestic
publiccompanies,including:
thesectionsoftheExchangeActregulatingthesolicitationofproxies,consentsorauthorizationsinrespectofasecurityregisteredunderthe
ExchangeAct;
thesectionsoftheExchangeActrequiringinsiderstofilepublicreportsoftheirstockownershipandtradingactivitiesandliabilityforinsiders
whoprofitfromtradesmadeinashortperiodoftime;
therulesundertheExchangeActrequiringthefilingwiththeSecuritiesandExchangeCommissionofquarterlyreportsonForm10-Qcontaining
unauditedfinancialandotherspecifiedinformation,orcurrentreportsonForm8-K,upontheoccurrenceofspecifiedsignificantevents;and
RegulationFairDisclosure,orRegulationFD,whichregulatesselectivedisclosuresofmaterialinformationbyissuers.
7
Table of Contents
The Offering
Subordinate Voting Shares Offered by us 6,308,154subordinatevotingshares.
Subordinate Voting Shares Offered by the Selling 13,691,846subordinatevotingshares(or16,691,846subordinatevotingsharesiftheunderwriters
Shareholders exercisetheirover-allotmentoptioninfull).
Subordinate Voting Shares to be Outstanding After This 20,000,000subordinatevotingshares(or23,000,000subordinatevotingsharesiftheunderwriters
Offering exercisetheirover-allotmentoptioninfull).
Multiple Voting Shares to be Outstanding After This 86,308,154multiplevotingshares(or83,308,154multiplevotingsharesiftheunderwriters
Offering exercisetheirover-allotmentoptioninfull).
Offering Price $17.00persubordinatevotingshare.
Option to Purchase Additional Subordinate Voting Theunderwritershaveanoptionforaperiodof30daysfromthedateofthisprospectusto
Shares purchaseupto3,000,000additionalsubordinatevotingsharesfromcertainoftheselling
shareholderstocoverover-allotments.
Voting Rights
Followingthesaleofsubordinatevotingsharesofferedhereby,wewillhavetwoclassesofsharesoutstanding:multiplevotingsharesandsubordinatevoting
shares.Therightsoftheholdersofourmultiplevotingsharesandsubordinatevotingsharesaresubstantiallyidentical,exceptwithrespecttovotingand
conversion.
Thesubordinatevotingshareswillhaveonevotepershareandthemultiplevotingshareswillhave10votespershare.SeeDescriptionofShareCapital
AuthorizedShareCapital.
Aftergivingeffecttothisoffering,thesubordinatevotingshareswillcollectivelyrepresentapproximately19%ofourtotalissuedandoutstandingsharesand
approximately2%ofthevotingpowerattachedtoallofourissuedandoutstandingshares(22%and3%,respectively,iftheunderwritersover-allotment
optionisexercisedinfull)andthemultiplevotingshareswillcollectivelyrepresentapproximately81%ofourtotalissuedandoutstandingsharesand
approximately98%ofthevotingpowerattachedtoallofourissuedandoutstandingshares(78%and97%,respectively,iftheunderwritersover-allotment
optionisexercisedinfull).
Conversion Rights Thesubordinatevotingsharesarenotconvertibleintoanyotherclassofshares.Themultiple
votingsharesareconvertibleintosubordinatevotingsharesonaone-for-onebasisattheoptionof
theholderoruponthesaleofmultiplevotingsharestoanunaffiliatedthirdparty.
8
Table of Contents
Inaddition,ourarticlesprovidethatmultiplevotingshareswillautomaticallyconvertinto
subordinatevotingsharesincertainothercircumstances.SeeDescriptionofShareCapital
AuthorizedShareCapitalConversion.
Take-Over Bid Protection Inaccordancewithapplicableregulatoryrequirementsdesignedtoensurethat,intheeventofa
take-overbid,theholdersofsubordinatevotingshareswillbeentitledtoparticipateonanequal
footingwithholdersofmultiplevotingshares,wewillenterintoacoattailagreementwithholders
ofmultiplevotingshares.Thecoattailagreementwillcontainprovisionscustomaryfordual-class
corporationslistedontheTorontoStockExchange,ortheTSX,designedtopreventtransactions
thatotherwisewoulddeprivetheholdersofsubordinatevotingsharesofrightsunderapplicable
take-overbidlegislationinCanadatowhichtheywouldhavebeenentitledifthemultiplevoting
shareshadbeensubordinatevotingshares.SeeDescriptionofShareCapitalCertainImportant
ProvisionsofourArticlesandtheBCBCATake-OverBidProtection.
Use of Proceeds Weexpecttoreceivenetproceedsfromthisofferingofapproximately$100.0million,after
deductingunderwritingcommissions,baseduponaninitialpublicofferingpriceof$17.00per
subordinatevotingshare.Wewillnotreceiveanyproceedsfromthesaleofsubordinatevoting
sharesinthisofferingbythesellingshareholders,includinguponthesaleofsubordinatevoting
sharesiftheunderwritersexercisetheiroptiontopurchaseadditionalsubordinatevotingshares
fromcertainofthesellingshareholdersinthisoffering,tocoverover-allotments.
Weintendtousetheproceedsfromthisofferingtorepayaportionofouroutstanding
indebtedness,including$35.0millionunderourRevolvingFacilityand$65.0millionunderour
TermLoanFacilityincurredinconnectionwiththeRecapitalization.SeeUseofProceedsand
Recapitalization.
Directed Share Program Atourrequest,theunderwritershavereservedforsaleuptofivepercentofthesubordinatevoting
sharestobesoldbyusandthesellingshareholders,atthepublicofferingpricetocertain
individualsthroughadirectedshareprogram,includingemployees,directorsandotherpersons
associatedwithuswhohaveexpressedinterestinpurchasingsharesinthisoffering.Thenumber
ofsubordinatevotingsharesavailableforsaletothegeneralpublicwillbereducedbythenumber
ofreservedsharessoldtotheseindividuals.Anyreservedsharesnotpurchasedbythese
individualswillbeofferedbytheunderwriterstothegeneralpubliconthesamebasisastheother
subordinatevotingsharesofferedunderthisprospectus.SeeUnderwriting.
Dividend Policy Wedonotexpecttopayanydividendsonoursubordinatevotingsharesintheforeseeablefuture.
SeeDividendPolicy.
9
Table of Contents
Thetotalnumberofsubordinatevotingsharesandmultiplevotingsharestobeoutstandingafterthisofferingisbasedonnosubordinatevotingsharesand
100,000,000multiplevotingsharesoutstandingasofDecember31,2016onaproformabasisaftergivingeffecttothetransactionsdescribedbelow,and
excludes:
5,899,660subordinatevotingsharesissuableuponexerciseofoptionsoutstandingunderourequityincentiveplansasofMarch1,2017ata
weightedaverageexercisepriceof$1.63persubordinatevotingshare;and
5,100,340additionalsubordinatevotingsharesreservedforfutureissuanceunderourequityincentiveplans.
Exceptasotherwiseindicated,theinformationinthisprospectusreflectsorassumes:
thefilingofamendedarticles,whichoccurredpriortotheconsummationofthisoffering,to,amongotherthings,amendandredesignateour
ClassACommonSharesasmultiplevotingshares,eliminateourremainingseriesofcommonandpreferredsharesandcreateoursubordinate
votingshares;
noexercisebytheunderwritersoftheiroptiontopurchaseadditionalsubordinatevotingsharesfromcertainofthesellingshareholdersidentified
inthisprospectustocoverover-allotments;and
noexerciseofstockoptionsoutstanding(providedthatoptionsexercisedasofthedateofthisprospectusarereflectedunderDescriptionof
ShareCapitalPriorSales).
10
Table of Contents
Thefollowingtablessetforthoursummaryhistoricalconsolidatedfinancialdata.Youshouldreadthefollowingsummaryhistoricalconsolidatedfinancial
datainconjunctionwithManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperationsandourconsolidatedfinancialstatements
andrelatednotesincludedelsewhereinthisprospectus.
WehavederivedthesummaryhistoricalconsolidatedinformationfortheyearsendedMarch31,2016andMarch31,2015andtheperiodsfromDecember9,
2013toMarch31,2014andApril1,2013toDecember8,2013andthesummaryconsolidatedfinancialpositioninformationasofMarch31,2015and2016
fromourauditedconsolidatedfinancialstatementsincludedelsewhereinthisprospectus.Wehavederivedthesummaryconsolidatedstatementofoperations
informationfortheninemonthsendedDecember31,2015and2016andthesummaryconsolidatedfinancialpositioninformationasofDecember31,2016
fromourunauditedinterimconsolidatedfinancialstatementsincludedelsewhereinthisprospectus.Ourconsolidatedfinancialstatementshavebeenprepared
inaccordancewithIFRSandarepresentedinthousandsofCanadiandollarsexceptwhereotherwiseindicated.Ourhistoricalresultsarenotnecessarily
indicativeoftheresultsthatshouldbeexpectedinanyfutureperiod.
OnDecember9,2013,BainCapitalacquiredamajorityequityinterestinourbusinessaspartoftheAcquisition.Accordingly,thefinancialstatements
presentedelsewhereinthisprospectusasofandforfiscal2014reflecttheperiodsbothpriorandsubsequenttotheAcquisition.Theconsolidatedfinancial
statementsforMarch31,2014arepresentedseparatelyforthepredecessorperiodfromApril1,2013throughDecember8,2013,whichwerefertoasthe
Predecessor2014Period,andthesuccessorperiodfromDecember9,2013throughMarch31,2014,whichwerefertoastheSuccessor2014Period,withthe
periodspriortotheAcquisitionbeinglabeledaspredecessorandtheperiodssubsequenttotheAcquisitionlabeledassuccessor.Forthepurposeofperforming
acomparisontofiscal2015,wehavepreparedUnauditedProFormaCombinedSupplementalFinancialInformationforfiscal2014,whichgiveseffecttothe
AcquisitionasifithadoccurredonApril1,2013,andwhichwerefertoastheUnauditedProFormaCombined2014Period.SeeManagementsDiscussion
andAnalysisofFinancialConditionandResultsofOperationsBasisofPresentation.
Successor Predecessor
Period from
Nine months Nine months December 9, Period from
ended ended Fiscal Year Fiscal Year 2013 to April 1, 2013
CAD$000s December 31, December 31, ended March ended March March 31, to December 8,
(except per share data) 2016 2015 31, 2016 31, 2015 2014 2013
Statement of Operations Data:
Revenue $ 352,681 $ 248,909 $ 290,830 $ 218,414 $ 17,263 $ 134,822
Costofsales
168,403
122,107
145,206
129,805
14,708
81,613
11
Table of Contents
Successor Predecessor
Period from
Nine months Nine months Fiscal Year Fiscal Year December 9, Period from
ended ended ended ended 2013 to April 1, 2013
CAD$000s December 31, December 31, March 31, March 31, March 31, to December 8,
(except per share data) 2016 2015 2016 2015 2014 2013
Earnings(loss)pershare
basic 0.45 0.36 0.26 0.14 (0.15) 157,505.15
diluted 0.44 0.35 0.26 0.14 (0.15) 157,505.15
Weightedaveragenumberofshares
outstanding
basic 100,000,000 100,000,000 100,000,000 100,000,000 100,000,000 97
diluted 101,751,470 101,622,219 101,680,207 101,211,134 100,000,000 97
Other Data:
EBITDA(3) $ 75,578 $ 55,009 $ 46,870 $ 30,063 $ (17,714) $ 23,609
AdjustedEBITDA(3) 92,443 61,913 54,307 37,191 (8,113) 23,984
AdjustedEBITDAMargin(4) 26.2% 24.9% 18.7% 17.0% (47.0)% 17.8%
AdjustedNetIncome(loss)(3) 58,851 38,520 30,122 21,374 (7,691) 15,554
GrossMargin 52.3% 50.9% 50.1% 40.6% 14.8% 39.5%
As of As of As of
December 31, March 31, March 31,
2016 2016 2015
Financial Position Information:
Cash $ 30,180 $ 7,226 $ 5,918
Totalassets 442,062 353,018 274,825
Totalliabilities 373,963 210,316 160,392
Shareholdersequity 68,099 142,702 114,433
(1) Netinterestandotherfinancecostsconsistofinterestexpenserelatingtooursubordinateddebt,whichwasrefinancedinconnectionwiththe
Recapitalization,aswellasourRevolvingFacilityandpriorcreditfacility.Interestexpenseassociatedwiththesubordinateddebtrepresented$3,822in
theninemonthsendedDecember31,2016,$5,598infiscal2016,$5,398infiscal2015and$4,809intheUnauditedProFormaPeriodendedMarch31,
2014.SeeManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperationsBasisofPresentationforapresentationofthe
UnauditedProFormaCombined2014Period.
(2) TheproformastatementofcomprehensiveincomedataforthefiscalyearendedMarch31,2016andtheninemonthsendedDecember31,2016give
effectto(a)theRecapitalization,includingtheincurrenceofindebtednessundertheTermLoanFacilityandtherepaymentoftheBainCapital
subordinateddebt,(b)theissuanceof6,308,154subordinatevotingsharesintheofferingataninitialpublicofferingpriceof$17.00per
12
Table of Contents
subordinatevotingshareandtheapplicationofthenetproceedstherefromasdescribedinUseofProceeds,and(c)theterminationofour
managementagreementwithBainCapitalinconnectionwiththecompletionofthisoffering,asifeachhadoccurredonthefirstdayoftherespective
periodpresented.SeeRelatedPartyTransactionsManagementAgreementandRecapitalization.
ThefollowingisareconciliationofhistoricalnetincometoproformanetincomeforthefiscalyearendedMarch31,2016andtheninemonthsended
December31,2016:
Nine months ended Fiscal year ended
December 31, 2016 March 31, 2016
Netincomeasreported $ 45,071 $ 26,485
Decreaseinmanagementfees(a) 1,560 1,092
Net(increase)decreaseininterestexpense(b) 135 (2,042)
(Increase)inincometaxexpense(c)
(432)
240
Proformanetincome $ 46,334
$ 25,775
Proformaweightedaveragesharesoutstanding(d)
Basic 106,308,154 106,308,154
Diluted 108,059,624 107,988,361
Proformabasicnetincomepershare $ 0.44 $ 0.24
Proformadilutednetincomepershare $ 0.43 $ 0.24
(a) Reflectsthetermination,inconnectionwiththeoffering,ofthemanagementfeespaidtoBainCapitalpursuanttothemanagementagreementfor
theperiodspresented.SeeRelatedPartyTransactionsManagementAgreement.
(b) ReflectsthenetadjustmenttointerestexpenseresultingfromtheincurrenceofindebtednessunderthenewTermLoanFacility,therepaymentof
thesubordinateddebtandtherepayment,withthenetproceedsofthisoffering,of$65millionaggregateprincipalamountofoutstandingloans
underourTermLoanFacilityandtherepaymentof$35millionunderourRevolvingFacility.SeeDescriptionofIndebtedness,andUseof
Proceeds.ProformapresentationdoesnotgiveeffecttotherefinancingofourpriorcreditfacilitycompletedonJune3,2016.SeeNotes16and
22totheauditedconsolidatedfinancialstatementsincludedinthisprospectus.
(c) Reflectsadjustmentstohistoricalincometaxexpensetoreflectthenetincreasesinincometaxexpenseduetohigherincomebeforeincometaxes
resultingfromthedecreaseinmanagementfeesasaresultoftheterminationofthemanagementagreementwithBainCapitaldescribedin(a)
aboveandanet(increase)decreaseininterestexpenseasaresultofournewTermLoanFacilityandRevolvingFacilityasdescribedin(b)above,
assumingataxrateof25.5%and25.3%foreachrespectiveperiodpresented.
(d) Reflects6,308,154additionalsubordinatevotingsharestobeissuedbyusinthisoffering.
ThefollowingisareconciliationofhistoricalinterestexpensetoproformainterestexpenseforthefiscalyearendedMarch31,2016andthenine
monthsendedDecember31,2016:
Nine months ended Fiscal year ended
December 31, 2016 March 31, 2016
Interestexpenseasreported 7,541 7,834
IncreaseresultingfromRecapitalizationTransactions(e) 3,507 6,898
Decreaseresultingfromapplicationofnetproceeds(f)
(3,642)
(4,856)
Proformainterestexpense 7,406
9,876
13
Table of Contents
(e) ReflectstheinterestexpenseresultingfromtheincreaseinouroutstandingborrowingspursuanttotheTermLoanoffsetbytherepaymentof
subordinateddebtdescribedinfootnote(b)aboveasifthesetransactionshadoccurredonApril1,2015andwereineffectduringtheentire
periodspresented.TheinterestexpensefortheTermLoanFacilityiscalculatedbyassumingthebaseLIBORrateof1%plustheapplicable
marginof5.00%andisnotcalculatedusingtheeffectiveinterestmethodandthereforeexcludestheimpactofapproximatelyCAD$6.5millionof
originalissuediscountandtransactioncostsofCAD$3.4millionincurredinconnectionwiththeissuanceoftheTermLoanFacility.
(f) Reflectstheapplicationof$65.0millionofnetproceedstotherepaymentofindebtednessunderourTermLoanFacilityand$35.0millionofnet
proceedstotherepaymentofindebtednessunderourRevolvingFacility,attheassumedinterestrateof2.73%.Thisdecreaseexcludestheitems
describedundernote(e).
(3) EBITDA,AdjustedEBITDA,AdjustedEBITDAMarginandAdjustedNetIncomearefinancialmeasuresthatarenotdefinedunderIFRS.Weuse
thesenon-IFRSfinancialmeasures,andbelievetheyenhanceaninvestorsunderstandingofourfinancialandoperatingperformancefromperiodto
period,becausetheyexcludecertainmaterialnon-cashitemsandcertainotheradjustmentswebelievearenotreflectiveofourongoingoperationsand
ourperformance.Inparticular,followingtheAcquisition,wehavemadechangestoourlegalandoperatingstructuretobetterpositionourorganization
toachieveourstrategicgrowthobjectives,whichhaveresultedinoutflowsofeconomicresources.Accordingly,weusethesemetricstomeasureour
corefinancialandoperatingperformanceforbusinessplanningpurposesandasacomponentinthedeterminationofincentivecompensationfor
managementemployees.Inaddition,webelieveEBITDA,AdjustedEBITDA,AdjustedEBITDAMarginandAdjustedNetIncomearemeasures
commonlyusedbyinvestorstoevaluatecompaniesintheapparelindustry.However,theyarenotpresentationsmadeinaccordancewithIFRSandthe
useofthetermsEBITDA,AdjustedEBITDA,AdjustedEBITDAMarginandAdjustedNetIncomevaryfromothersinourindustry.Thesefinancial
measuresarenotintendedtorepresentandshouldnotbeconsideredasalternativestonetincome,operatingincomeoranyotherperformancemeasures
derivedinaccordancewithIFRSasmeasuresofoperatingperformanceoroperatingcashflowsorasmeasuresofliquidity.
EBITDA,AdjustedEBITDA,AdjustedEBITDAMarginandAdjustedNetIncomehaveimportantlimitationsasanalyticaltoolsandyoushouldnot
considertheminisolationorassubstitutesforanalysisofourresultsasreportedunderIFRS.Forexample,thesefinancialmeasures:
excludecertaintaxpaymentsthatmayreducecashavailabletous;
donotreflectanycashcapitalexpenditurerequirementsfortheassetsbeingdepreciatedandamortizedthatmayhavetobereplacedinthefuture;
donotreflectchangesin,orcashrequirementsfor,ourworkingcapitalneeds;
donotreflecttheinterestexpense,orthecashrequirementsnecessarytoserviceinterestorprincipalpayments,onourdebt;and
othercompaniesinourindustrymaycalculatethesemeasuresdifferentlythanwedo,limitingtheirusefulnessascomparativemeasures.
14
Table of Contents
ThetablesbelowillustrateareconciliationofnetincometoEBITDA,AdjustedEBITDAandAdjustedNetIncomefortheperiodspresented:
Period from Period from
Nine months Nine months April 1, December 9, Unaudited Pro
ended ended Year ended 2013 to 2013 to Forma Period
December 31, December 31, Year ended March 31, December 8, March 31, ended March 31,
CAD$000s 2016 2015 March 31, 2016 2015 2013 2014 2014 (l)
Net income (loss) $ 45,071 $ 35,687 $ 26,485 $ 14,425 $ 15,278 $ (15,477) $ 3,023
Add the impact of:
Incometaxexpense(recovery) 15,416 8,662 6,473 4,707 5,550 (5,054) 1,024
Interestexpense 8,620 6,017 7,996 7,537 1,815 1,788 7,136
Depreciationandamortization
6,471
4,643
5,916
3,394
966
1,029
3,146
Period from Period from
Nine months Nine months April 1, December 9, Unaudited Pro
ended ended 2013 to 2013 to Forma Period
December 31, December 31, Year ended Year ended December 8, March 31, ended March 31,
CAD$000s 2016 2015 March 31, 2016 March 31, 2015 2013 2014 2014 (l)
Net income (loss) $ 45,071 $ 35,687 $ 26,485 $ 14,425 $ 15,278 $ (15,477) $ 3,023
Add the impact of:
BainCapitalmanagementfees(a) 1,560 647 1,092 894 277 539
Transactioncosts(b) 5,624 8 299 5,791
Purchaseaccountingadjustments(c) 2,861 2,906
Unrealized(gain)/lossonderivatives(d) 4,422 (4,422) (138)
Unrealizedforeignexchangelossontermloan(e) 1,561
Internationalrestructuringcosts(f) 175 2,877 6,879 1,038
Share-basedcompensation(g) 2,536 375 500 300
Agentterminationsandother(h) 2,997 3,089 2,173 375 627 1,002
Non-cashrentexpense(i) 987
AmortizationonintangibleassetsacquiredbyBainCapital(j)
1,632
1,632
2,175
2,175
725
2,175
(a) RepresentstheamountpaidpursuanttothemanagementagreementwithBainCapitalforongoingconsultingandotherservices.Inconnection
withthisoffering,themanagementagreementwillbeterminated,andBainCapitalwillnolongerreceivemanagementfeesfromus.SeeCertain
RelationshipsandRelatedPartyTransactionsManagementAgreement.
(b) InconnectionwiththeAcquisitionandthefilingofthisprospectus,weincurredexpensesrelatedtoprofessionalfees,consulting,legal,and
accountingthatwouldotherwisenothavebeenincurredandweredirectlyrelatedtothesetwomatters.Thesefeesarenotindicativeofthe
companysongoingcostsandweexpecttheywilldiscontinuefollowingthecompletionofthisoffering.
(c) InconnectionwiththeAcquisition,werecognizedacquiredinventoryatfairvalue,whichincludedamark-upforprofit.Recordinginventoryat
fairvalueinpurchaseaccountinghadtheeffectofincreasinginventory
15
Table of Contents
andtherebyincreasingthecostofsalesinsubsequentperiodsascomparedtotheamountswewouldhaverecognizediftheinventorywassold
throughatcost.Thewrite-upofacquiredinventorysoldrepresentstheincrementalcostofsalesthatwasrecognizedasaresultofpurchase
accounting.Thisinventorywassoldinfiscal2014andfiscal2015andhasimpactednetincomeinbothperiods.
(d) Representsunrealizedgainsonforeignexchangeforwardcontractsrecordedinfiscal2016thatrelatetofiscal2017.Wemanageourexposureto
foreigncurrencyriskbyenteringintoforeignexchangeforwardcontracts.Managementforecastsitsnetcashflowsinforeigncurrencyusing
expectedrevenuefromordersitreceivesforfutureperiods.Theunrealizedgainsandlossesonthesecontractsarerecognizedinnetincomefrom
thedateofinceptionofthecontract,whilethecashflowstowhichthederivativesrelatedarenotrealizeduntilthecontractsettles.Management
believesthatreflectingtheseadjustmentsintheperiodinwhichthenetcashflowswilloccurismoreappropriate.
(e) Representsanon-cashchargeforunrealizedlossesonthetranslationoftheTermLoanFacilityfromUSDtoCAD$.
(f) RepresentsexpensesincurredtoestablishourEuropeanheadquartersinZug,Switzerland,includingclosingseveralsmallerofficesacrossEurope,
relocatingpersonnelandincurringtemporaryofficecosts.
(g) Representsnon-cashshare-basedcompensationexpense.Adjustmentsinfiscal2017reflectmanagementsestimatesthatcertaintranchesof
outstandingoptionawardswillvest.
(h) Representsaccruedexpensesinrespectofterminationpaymentstobemadetoourthirdpartysalesagents.Aspartofastrategytotransition
certainsalesfunctionsin-house,weterminatedthemajorityofourthirdpartysalesagentsandcertaindistributors,primarilyduringfiscal2015
and2016,whichresultedinindemnitiesandotherterminationpayments.Assalesagentshavenowlargelybeeneliminatedfromthesales
structure,managementdoesnotexpectthesechargestorecurinfuturefiscalperiods.
(i) Representsnon-cashamortizationchargesduringpre-openingperiodsfornewstoreleases.
(j) AsaresultoftheAcquisition,werecognizedanintangibleassetforcustomerlistsintheamountof$8.7million,whichhasausefullifeoffour
years.
(k) Duringfiscal2016,weenteredintoaseriesoftransactionswherebyourwholly-ownedsubsidiary,CanadaGooseInternationalAG,acquiredthe
globaldistributionrightstoourproducts.Asaresult,therewasaone-timetaxbenefitof$3.5millionrecordedduringtheyear.
(l) SeeManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperationsBasisofPresentationforapresentationofour
UnauditedProFormaCombinedSupplementalFinancialInformationfortheyearendedMarch31,2014.
(4) AdjustedEBITDAMarginisequaltoAdjustedEBITDAfortheperiodpresentedasapercentageofrevenueforthesameperiod.
16
Table of Contents
Risk Factors
This offering and investing in our subordinate voting shares involves a high degree of risk. You should carefully consider the risks and uncertainties described
below together with all of the other information contained in this prospectus, including our consolidated financial statements and the related notes appearing at the
end of this prospectus, before deciding to invest in our subordinate voting shares. If any of the following risks actually occurs, our business, prospects, operating
results and financial condition could suffer materially, the trading price of our subordinate voting shares could decline and you could lose all or part of your
investment. Please also see Cautionary Note Regarding Forward-Looking Statements.
Weanticipatethat,asourbusinessexpandsintonewmarketsandnewproductcategoriesandasthemarketbecomesincreasinglycompetitive,maintainingand
enhancingourbrandmaybecomedifficultandexpensive.Conversely,aswepenetratethesenewmarketsandourbrandbecomesmorewidelyavailable,itcould
potentiallydetractfromtheappealstemmingfromthescarcityofourbrand.Ourbrandmayalsobeadverselyaffectedifourpublicimageorreputationistarnished
bynegativepublicity.Inaddition,ineffectivemarketing,productdiversiontounauthorizeddistributionchannels,productdefects,counterfeitproducts,unfair
labourpractices,andfailuretoprotecttheintellectualpropertyrightsinourbrandaresomeofthepotentialthreatstothestrengthofourbrand,andthoseandother
factorscouldrapidlyandseverelydiminishconsumerconfidenceinus.Maintainingandenhancingourbrandwilldependlargelyonourabilitytobealeaderinthe
premiumouterwearindustryandtocontinuetoofferarangeofhighqualityproductstoourcustomers,whichwemaynotexecutesuccessfully.Anyofthese
factorscouldharmoursales,profitabilityorfinancialcondition.
Akeyelementofourgrowthstrategyisexpansionofourproductofferingsintonewproductcategories.Wemaybeunsuccessfulindesigningproductsthatmeet
ourcustomersexpectationsforourbrandorthatareattractivetonewcustomers.Ifweareunabletoanticipatecustomerpreferencesorindustrychanges,orifwe
areunabletomodifyourproductsonatimelybasisorexpandeffectivelyintonewproductcategories,wemaylosecustomers.AsofDecember31,2016,ourbrand
issoldin36countriesthroughnearly2,500pointsofdistribution.Asweexpandintonewgeographicmarkets,consumersinthesenewmarketsmaybeless
compelledbyourbrandimageandmaynotbewillingtopayahigherpricetopurchaseourpremiumfunctionalproductsascomparedtotraditionalouterwear.Our
operatingresultswouldalsosufferifourinvestmentsandinnovationsdonotanticipatetheneedsofourcustomers,arenotappropriatelytimedwithmarket
opportunitiesorarenoteffectivelybroughttomarket.
Because our business is highly concentrated on a single, discretionary product category, premium outerwear, we are vulnerable to changes in consumer
preferences that could harm our sales, profitability and financial condition.
Ourbusinessisnotcurrentlydiversifiedandconsistsprimarilyofdesigning,manufacturinganddistributingpremiumouterwearandaccessories.Infiscal2016,our
mainproductcategoryacrossallseasons,ourjackets,wasmadeupofover100stylesandcomprisedthemajorityofoursales.Consumerpreferencesoftenchange
17
Table of Contents
rapidly.Therefore,ourbusinessissubstantiallydependentonourabilitytoattractcustomerswhoarewillingtopayapremiumforourproducts.Anyfutureshifts
inconsumerpreferencesawayfromretailspendingforpremiumouterwearandaccessorieswouldalsohaveamaterialadverseeffectonourresultsofoperations.
Inaddition,webelievethatcontinuedincreasesinsalesofpremiumouterwearwilllargelydependoncustomerscontinuingtodemandtechnicalsuperiorityfrom
theirluxuryproducts.Ifthenumberofcustomersdemandingpremiumouterweardoesnotcontinuetoincrease,orifourcustomersarenotconvincedthatour
premiumouterwearismorefunctionalorstylishthanotherouterwearalternatives,wemaynotachievethelevelofsalesnecessarytosupportnewgrowthplatforms
andourabilitytogrowourbusinesswillbeseverelyimpaired.
A downturn in the economy may affect customer purchases of discretionary items, which could materially harm our sales, profitability and financial condition.
Manyfactorsaffectthelevelofconsumerspendingfordiscretionaryitemssuchasourpremiumouterwearandrelatedproducts.Thesefactorsincludegeneral
economicconditions,interestandtaxrates,theavailabilityofconsumercredit,disposableconsumerincome,unemploymentandconsumerconfidenceinfuture
economicconditions.Consumerpurchasesofdiscretionaryitems,suchasourpremiumouterwear,tendtodeclineduringrecessionaryperiodswhendisposable
incomeislower.Duringour60-yearhistory,wehaveexperiencedrecessionaryperiods,butwecannotpredicttheeffectonoursalesandprofitability.Adownturn
intheeconomyinmarketsinwhichwesellourproductsmaymateriallyharmoursales,profitabilityandfinancialcondition.
We operate in a highly competitive market and the size and resources of some of our competitors may allow them to compete more effectively than we can,
resulting in a loss of our market share and a decrease in our revenue and profitability.
Themarketforouterwearishighlyfragmented.Wecompetedirectlyagainstotherwholesalersanddirectretailersofpremiumfunctionalouterwearandluxury
apparel.Becauseofthefragmentednatureofthemarketplace,wealsocompetewithotherapparelsellers,includingthosewhodonotspecializeinouterwear.
Manyofourcompetitorshavesignificantcompetitiveadvantages,includinglongeroperatinghistories,largerandbroadercustomerbases,moreestablished
relationshipswithabroadersetofsuppliers,greaterbrandrecognitionandgreaterfinancial,researchanddevelopment,storedevelopment,marketing,distribution,
andotherresourcesthanwedo.
Ourcompetitorsmaybeabletoachieveandmaintainbrandawarenessandmarketsharemorequicklyandeffectivelythanwecan.Manyofourcompetitorshave
moreestablishedanddiversifiedmarketingprograms,includingwithrespecttopromotionoftheirbrandsthroughtraditionalformsofadvertising,suchasprint
mediaandtelevisioncommercials,andthroughcelebrityendorsements,andhavesubstantialresourcestodevotetosuchefforts.Ourcompetitorsmayalsocreate
andmaintainbrandawarenessusingtraditionalformsofadvertisingmorequicklythanwecan.Ourcompetitorsmayalsobeabletoincreasesalesintheirnewand
existingmarketsfasterthanwecanbyemphasizingdifferentdistributionchannelsthanwecan,suchascatalogsalesoranextensiveretailnetwork,andmanyof
ourcompetitorshavesubstantialresourcestodevotetowardincreasingsalesinsuchways.
18
Table of Contents
We have grown rapidly in recent years. If we are unable to manage our operations at our current size or to manage any future growth effectively, the pace of
our growth may slow.
Wehaveexpandedouroperationsrapidlysince2013andhavebeendevelopingaDTCchannelwiththelaunchofourfoure-commercestoresinCanadaandthe
UnitedStatesaswellastheUnitedKingdomandFranceinAugust2014,September2015andSeptember2016,respectively,andtheopeningofourfirsttworetail
storesinOctoberandNovemberof2016inTorontoandNewYorkCity,respectively.Ourrevenueincreasedfrom$152.1millionforfiscal2014to$290.8million
forfiscal2016,aCAGRofapproximately38.3%,including$33.0millionofrevenuegeneratedfromourDTCchannelinfiscal2016.
Ifouroperationscontinuetogrow,ofwhichtherecanbenoassurance,wewillberequiredtocontinuetoexpandoursalesandmarketing,productdevelopment,
manufacturinganddistributionfunctions,toupgradeourmanagementinformationsystemsandotherprocesses,andtoobtainmorespaceforourexpanding
administrativesupportandotherpersonnel.Ourcontinuedgrowthcouldincreasethestrainonourresources,andwecouldexperienceoperatingdifficulties,
includingdifficultiesinhiring,trainingandmanaginganincreasingnumberofemployeesandmanufacturingcapacitytoproduceourproducts,anddelaysin
productionandshipments.Thesedifficultiesmayresultintheerosionofourbrandimage,diverttheattentionofmanagementandkeyemployeesandimpact
financialandoperationalresults.Inaddition,inordertocontinuetoexpandourDTCchannel,weexpecttocontinuetoaddselling,general&administrative
expensestoouroperatingprofile.Thesecosts,whichincludeleasecommitments,headcountandcapitalassets,couldresultindecreasedmarginsifweareunable
todrivecommensurategrowth.
Our growth strategy involves expansion of our DTC channel, including retail stores and on-line, which may present risks and challenges that we have not yet
experienced.
Ourbusinesshasonlyrecentlyevolvedfromoneinwhichweonlydistributedproductsonawholesalebasisforresalebyotherstoonethatalsoincludesamulti-
channelexperience,whichincludesretailphysicalandonlinestoresoperatedbyus.Growingoure-commerceplatformsandnumberofphysicalstoresisessential
toourgrowthstrategy,asisexpandingourproductofferingsavailablethroughthesechannels.However,wehavelimitedoperatingexperienceexecutingthis
strategy,whichwelaunchedwithourfirste-commercestoreinAugust2014andourfirstretailstoreinOctober2016.Thisstrategyhasandwillcontinuetorequire
significantinvestmentincross-functionaloperationsandmanagementfocus,alongwithinvestmentinsupportingtechnologiesandretailstorespaces.Ifweare
unabletoprovideaconvenientandconsistentexperienceforourcustomers,ourabilitytocompeteandourresultsofoperationscouldbeadverselyaffected.In
addition,ifoure-commercestoredesigndoesnotappealtoourcustomers,reliablyfunctionasdesigned,ormaintaintheprivacyofcustomerdata,orifweare
unabletoconsistentlymeetourbrandpromisetoourcustomers,wemayexperiencealossofcustomerconfidenceorlostsales,orbeexposedtofraudulent
purchases,whichcouldadverselyaffectourreputationandresultsofoperations.
WecurrentlyoperateouronlinestoresinCanada,theUnitedStates,theUnitedKingdomandFrance,andareplanningtoexpandoure-commerceplatformtoother
geographies.Thesecountriesmayimposedifferentandevolvinglawsgoverningtheoperationandmarketingofe-commercewebsites,aswellasthecollection,
storageanduseofinformationonconsumersinteractingwiththosewebsites.Wemayincuradditionalcostsandoperationalchallengesincomplyingwiththese
laws,anddifferencesintheselawsmaycauseustooperateourbusinessesdifferentlyindifferentterritories.Ifso,wemayincuradditionalcostsandmaynotfully
realizetheinvestmentinourinternationalexpansion.
Our operating results are subject to seasonal and quarterly variations in our revenue and operating income, which could cause the price of our subordinate
voting shares to decline.
Ourbusinessisseasonaland,historically,wehaverealizedapproximatelythreequartersofourrevenueandearningsforthefiscalyearinthesecondandthird
fiscalquarters,duetotheimpactofwholesaleordersin
19
Table of Contents
anticipationoftheWinterandholidaysellingseason.Manyoftheseordersarenotsubjecttocontractsand,ifcancelledforanyreason,couldresultinharmtoour
salesandfinancialresults.Anyfactorsthatharmoursecondandthirdfiscalquarteroperatingresults,includingdisruptionsinoursupplychain,unseasonablywarm
weatherorunfavourableeconomicconditions,couldhaveadisproportionateeffectonourresultsofoperationsfortheentirefiscalyear.Inaddition,wetypically
experiencenetlossesinourfirstandfourthfiscalquartersasweinvestaheadofourmostactiveseason.Disruptedsalesinoursecondandthirdfiscalquarters
couldupsetourseasonalbalanceleadingtoanadverseeffectonourfinancialandoperatingresults.
Inordertoprepareforourpeakshoppingseason,wemustmaintainhigherquantitiesoffinishedgoods.Asaresult,ourworkingcapitalrequirementsalsofluctuate
duringtheyear,increasinginthefirstandsecondfiscalquartersanddecliningsignificantlyinthefourthfiscalquarter.
Ourquarterlyresultsofoperationsmayalsofluctuatesignificantlyasaresultofavarietyofotherfactors,includingthesalescontributedbyourDTCchannel.Asa
result,historicalperiod-to-periodcomparisonsofoursalesandoperatingresultsarenotnecessarilyindicativeoffutureperiod-to-periodresults.Youshouldnot
relyontheresultsofasinglefiscalquarterasanindicationofourannualresultsorourfutureperformance.
limitingourabilitytoobtainadditionalfinancingtofundfutureworkingcapital,capitalexpenditures,acquisitionsorothergeneralcorporate
requirementsandincreasingourcostofborrowing;
requiringaportionofourcashflowtobededicatedtodebtservicepaymentsinsteadofotherpurposes,therebyreducingtheamountofcashflow
availableforworkingcapital,capitalexpenditures,acquisitionsandothergeneralcorporatepurposes;
requiringthenetcashproceedsofcertainequityofferingstobeusedtoprepayourdebtasopposedtootherpurposes;
exposingustotheriskofincreasedinterestratesascertainofourborrowings,includingborrowingsunderourseniorsecuredcreditfacilities,areat
variableratesofinterest;and
limitingourflexibilityinplanningforandreactingtochangesintheindustryinwhichwecompete.
Thecreditagreementsgoverningourseniorsecuredcreditfacilitiescontainanumberofrestrictivecovenantsthatimposeoperatingandfinancialrestrictionsonus,
includingrestrictionsonourabilitytoincurcertainliens,makeinvestmentsandacquisitions,incurorguaranteeadditionalindebtedness,paydividendsormake
otherdistributionsinrespectof,orrepurchaseorredeemourcommonorpreferredshares,orenterintocertainothertypesofcontractualarrangementsaffectingour
subsidiariesorindebtedness.Inaddition,therestrictivecovenantsinthecreditagreementgoverningourRevolvingFacilityrequireustomaintainaminimumfixed
chargecoverageratioifexcessavailabilityunderourRevolvingFacilityfallsbelowaspecifiedthreshold.
Althoughthecreditagreementsgoverningourseniorsecuredcreditfacilitiescontainrestrictionsontheincurrenceofadditionalindebtedness,thoserestrictionsare
subjecttoanumberofqualificationsandexceptionsandtheadditionalindebtednessincurredincompliancewiththoserestrictionscouldbesubstantial.Wemay
alsoseektoamendorrefinanceoneormoreofourdebtinstrumentstopermitustofinanceourgrowthstrategyorimprovethetermsofourindebtedness.
20
Table of Contents
Our plans to improve and expand our product offerings may not be successful, and implementation of these plans may divert our operational, managerial and
administrative resources, which could harm our competitive position and reduce our revenue and profitability.
InadditiontoourDTCstrategyandtheexpansionofourgeographicfootprint,weplantogrowourbusinessbyexpandingourproductofferings.Theprincipal
riskstoourabilitytosuccessfullycarryoutourplanstoexpandourproductofferinginclude:
ifourexpandedproductofferingsfailtomaintainandenhanceourdistinctivebrandidentity,ourbrandimagemaybediminishedandoursalesmay
decrease;
implementationoftheseplansmaydivertmanagementsattentionfromotheraspectsofourbusinessandplaceastrainonourmanagement,
operationalandfinancialresources,aswellasourinformationsystems;and
incorporationofnovelmaterialsorfeaturesintoourproductsmaynotbeacceptedbyourcustomersormaybeconsideredinferiortosimilarproducts
offeredbyourcompetitors.
Inaddition,ourabilitytosuccessfullycarryoutourplanstoexpandourproductofferingsmaybeaffectedbyeconomicandcompetitiveconditions,changesin
consumerspendingpatternsandchangesinconsumerpreferencesandstyles.Theseplanscouldbeabandoned,couldcostmorethananticipatedandcoulddivert
resourcesfromotherareasofourbusiness,anyofwhichcouldnegativelyimpactourcompetitivepositionandreduceourrevenueandprofitability.
We rely on a limited number of third-party suppliers to provide high quality raw materials.
Ourproductsrequirehighqualityrawmaterials,includingcotton,polyester,downandcoyotefur.Thepriceofrawmaterialsdependsonawidevarietyoffactors
largelybeyondthecontrolofCanadaGoose.Ashortage,delayorinterruptionofsupplyforanyreasoncouldnegativelyimpactourabilitytofulfillordersandhave
anadverseimpactonourfinancialresults.
Inaddition,werelyonaverysmallnumberofdirectsuppliersforourrawmaterials.Asaresult,anydisruptiontotheserelationshipscouldhaveamaterialadverse
effectonourbusiness.Eventsthatadverselyaffectoursupplierscouldimpairourabilitytoobtaininventoryinthequantitiesandatthequalitythatwedesire.Such
eventsincludedifficultiesorproblemswithoursuppliersbusinesses,finances,labourrelations,abilitytoimportrawmaterials,costs,production,insuranceand
reputation,aswellasnaturaldisastersorothercatastrophicoccurrences.Furthermore,therecanbenoassurancethatoursupplierswillcontinuetoprovidefabrics
andrawmaterialsorprovideproductsthatareconsistentwithourstandards.
Moregenerally,ifweneedtoreplaceanexistingsupplier,additionalsuppliesoradditionalmanufacturingcapacitymaynotbeavailablewhenrequiredonterms
thatareacceptabletous,oratall,andanynewsuppliermaynotmeetourstrictqualityrequirements.Intheeventwearerequiredtofindnewsourcesofsupply,we
mayencounterdelaysinproduction,inconsistenciesinqualityandaddedcostsasaresultofthetimeittakestotrainoursuppliersandmanufacturersinour
methods,productsandqualitycontrolstandards.Anydelays,interruptionorincreasedcostsinthesupplyofourrawmaterialscouldhaveanadverseeffectonour
abilitytomeetcustomerdemandforourproductsandresultinlowersalesandprofitabilitybothintheshortandlong-term.
21
Table of Contents
control,responsivenessandservice,financialstabilityandlabourandotherethicalpractices.Anydelays,interruptionorincreasedcostsinthesupplyoffabricor
manufactureofourproductscouldhaveanadverseeffectonourabilitytomeetcustomerdemandforourproductsandresultinlowerrevenueandoperating
incomebothintheshortandlong-term.
Our business or our results of operations could be harmed if we are unable to accurately forecast demand for our products.
Toensureadequateinventorysupply,weandourretailpartnersforecastinventoryneeds,whicharesubjecttoseasonalandquarterlyvariations.Ifwefailto
accuratelyforecastretailerdemand,wemayexperienceexcessinventorylevelsorashortageofproducttodelivertoourretailpartnersandthroughourDTC
channel.
Ifweunderestimatethedemandforourproducts,wemaynotbeabletoproduceproductstomeetourretailpartnerrequirements,andthiscouldresultindelaysin
theshipmentofourproductsandourfailuretosatisfydemand,aswellasdamagetoourreputationandretailpartnerrelationships.Ifweoverestimatethedemand
forourproducts,wecouldfaceinventorylevelsinexcessofdemand,whichcouldresultininventorywrite-downsorwrite-offsandthesaleofexcessinventoryat
discountedprices,whichwouldharmourgrossmarginsandourbrandmanagementefforts.Inaddition,failurestoaccuratelypredictthelevelofdemandforour
productscouldcauseadeclineinrevenueandharmourprofitabilityandfinancialcondition.
If we are unable to establish and protect our trademarks and other intellectual property rights, counterfeiters may produce copies of our products and such
counterfeit products could damage our brand image.
Giventheincreasedpopularityofourbrand,webelievethereisahighlikelihoodthatcounterfeitproductsorotherproductsinfringingonourintellectualproperty
rightswillcontinuetoemerge,seekingtobenefitfromtheconsumerdemandforCanadaGooseouterwear.Thesecounterfeitproductsdonotprovidethe
functionalityofourproductsandwebelievetheyareofsubstantiallylowerquality,andifcustomersarenotabletodifferentiatebetweenourproductsand
counterfeitproducts,thiscoulddamageourbrandimage.Inordertoprotectourbrand,wedevotesignificantresourcestotheregistrationandprotectionofour
trademarksandtoanti-counterfeitingeffortsworldwide.Weactivelypursueentitiesinvolvedinthetraffickingandsaleofcounterfeitmerchandisethroughlegal
actionorotherappropriatemeasures.Inspiteofourefforts,counterfeitingstilloccursand,ifweareunsuccessfulinchallengingathird-partysrightsrelatedto
trademark,copyrightorotherintellectualpropertyrights,thiscouldadverselyaffectourfuturesales,financialconditionandresultsofoperations.Wecannot
guaranteethattheactionswehavetakentocurbcounterfeitingandprotectourintellectualpropertywillbeadequatetoprotectthebrandandpreventcounterfeiting
inthefutureorthatwewillbeabletoidentifyandpursueallcounterfeiterswhomayseektobenefitfromourbrand.
Competitors have and will likely continue to attempt to imitate our products and technology and divert sales. If we are unable to protect or preserve our
intellectual property rights, brand image and proprietary rights, our business may be harmed.
Asourbusinesshasexpanded,ourcompetitorshaveimitated,andwilllikelycontinuetoimitate,ourproductdesignsandbranding,whichcouldharmourbusiness
andresultsofoperations.Competitorswhofloodthemarketwithproductsseekingtoimitateourproductscoulddivertsalesanddilutethevalueofourbrand.We
believeourtrademarks,copyrightsandotherintellectualpropertyrightsareextremelyimportanttooursuccessandourcompetitiveposition.
However,enforcingrightstoourintellectualpropertymaybedifficultandcostly,andwemaynotbesuccessfulinstoppinginfringementofourintellectual
propertyrights,particularlyinsomeforeigncountries,whichcouldmakeiteasierforcompetitorstocapturemarketshare.Intellectualpropertyrightsnecessaryto
protectourproductsandbrandmayalsobeunavailableorlimitedincertaincountries.Furthermore,oureffortstoenforceourtrademarks,copyrightsandother
intellectualpropertyrightsmaybemetwithdefenses,counterclaimsand
22
Table of Contents
countersuitsattackingthevalidityandenforceabilityofourtrademarkandotherintellectualpropertyrights.Continuedsalesofcompetingproductsbyour
competitorscouldharmourbrandandadverselyimpactourbusiness,financialconditionandresultsofoperations.
Labour-related matters, including labour disputes, may adversely affect our operations.
AsofMarch1,2017,lessthan25%ofouremployeesaremembersoflabourunions,andadditionalmembersofourworkforcemaybecomerepresentedbyunions
inthefuture.Theexposuretounionizedlabourinourworkforcenonethelesspresentsanincreasedriskofstrikesandotherlabourdisputes,andourabilitytoalter
labourcostswillbesubjecttocollectivebargaining,whichcouldadverselyaffectourresultsofoperations.Inaddition,potentiallabourdisputesatindependent
factorieswhereourgoodsareproduced,shippingports,ortransportationcarrierscreaterisksforourbusiness,particularlyifadisputeresultsinworkslowdowns,
lockouts,strikesorotherdisruptionsduringourpeakmanufacturing,shippingandsellingseasons.Anypotentiallabourdispute,eitherinourownoperationsorin
thoseofthirdparties,onwhomwerely,couldmateriallyaffectourcosts,decreaseoursales,harmourreputationorotherwisenegativelyaffectoursales,
profitabilityorfinancialcondition.
We rely significantly on information technology systems for our distribution systems and other critical business functions, and are increasing our reliance on
these functions as our DTC channel expands. Any failure, inadequacy, or interruption of those systems could harm our ability to operate our business
effectively.
Werelyoninformationsystemstoeffectivelymanageallaspectsofourbusiness,includingmerchandiseplanning,manufacturing,allocation,distributionand
sales.Ourrelianceonthesesystems,andtheirimportancetoourbusiness,willincreaseasweexpandourDTCchannelandglobaloperations.Werelyonanumber
ofthirdpartiestohelpuseffectivelymanagethesesystems.Ifinformationsystemswerelyonfailtoperformasexpected,ourbusinesscouldbedisrupted.The
failureofusorourvendorstomanageandoperateourinformationtechnologysystemsasexpectedcoulddisruptourbusiness,resultinournotprovidingadequate
product,losingsalesormarketshare,andreputationalharm,causingourbusinesstosuffer.Anysuchfailureordisruptioncouldhaveamaterialadverseeffecton
ourbusiness.
Ourinformationtechnologysystemsandvendorsalsomaybevulnerabletodamageorinterruptionfromcircumstancesbeyondourortheircontrol,includingfire,
flood,naturaldisasters,systemsfailures,networkorcommunicationsfailures,poweroutages,viruses,securitybreaches,cyber-attacksandterrorism.Wemaintain
disasterrecoveryproceduresintendedtomitigatetherisksassociatedwithsuchevents,butthereisnoguaranteethattheseprocedureswillbeadequateinany
particularcircumstance.Asaresult,suchaneventcouldmateriallydisrupt,andhaveamaterialadverseeffecton,ourbusiness.
We depend on our retail partners to display and present our products to customers, and our failure to maintain and further develop our relationships with our
retail partners could harm our business.
Wesellourproductsthroughknowledgeablelocal,regional,andnationalretailpartners.Ourretailpartnersservicecustomersbystockinganddisplayingour
products,andexplainingourproductattributes.Ourrelationshipswiththeseretailpartnersareimportanttotheauthenticityofourbrandandthemarketing
programswecontinuetodeploy.Ourfailuretomaintaintheserelationshipswithourretailpartnersorfinancialdifficultiesexperiencedbytheseretailpartners
couldharmourbusiness.
Wealsohavekeyrelationshipswithnationalretailpartners.Forfiscal2016,ourlargestCanadianwholesalecustomeraccountedfor17%ofourwholesalerevenue
inCanada,andourlargestU.S.wholesalecustomeraccountedfor18%ofourwholesalerevenueintheUnitedStates.Ifweloseanyofourkeyretailpartners,orif
anykeyretailpartnerreducestheirpurchasesofourexistingornewproducts,ortheirnumberofstoresoroperationsorpromotesproductsofourcompetitorsover
ours,orsuffersfinancialdifficultyorinsolvency,oursaleswouldbeharmed.Oursalesdepend,inpart,onretailerpartnerseffectivelydisplayingourproducts,
23
Table of Contents
includingprovidingattractivespaceintheirstores,includingshop-in-shops,andtrainingtheirsalespersonneltosellourproducts.Ifourretailpartnersreduceor
terminatethoseactivities,wemayexperiencereducedsalesofourproducts,resultinginlowerrevenueandgrossmargins,whichwouldharmourprofitabilityand
financialcondition.
Wecannotassureyouthatourretailpartnerswillcontinuetocarryourproductsinaccordancewithcurrentpracticesorcarryanynewproductsthatwedevelop.If
theserisksoccur,theycouldharmourbrandaswellasourresultsofoperationsandfinancialcondition.
Our marketing programs, e-commerce initiatives and use of customer information are governed by an evolving set of laws and enforcement trends and
unfavorable changes in those laws or trends, or our failure to comply with existing or future laws, could substantially harm our business and results of
operations.
Wecollect,process,maintainandusedata,includingsensitiveinformationonindividuals,availabletousthroughonlineactivitiesandothercustomerinteractions
inourbusiness.Ourcurrentandfuturemarketingprogramsmaydependonourabilitytocollect,maintainandusethisinformation,andourabilitytodosois
subjecttoevolvinginternational,U.S.,Canadian,Europeanandotherlawsandenforcementtrends.Westrivetocomplywithallapplicablelawsandotherlegal
obligationsrelatingtoprivacy,dataprotectionandcustomerprotection,includingthoserelatingtotheuseofdataformarketingpurposes.Itispossible,however,
thattheserequirementsmaybeinterpretedandappliedinamannerthatisinconsistentfromonejurisdictiontoanother,mayconflictwithotherrules,mayconflict
withourpracticesorfailtobeobservedbyouremployeesorbusinesspartners.Ifso,wemaysufferdamagetoourreputationandbesubjecttoproceedingsor
actionsagainstusbygovernmentalentitiesorothers.Anysuchproceedingoractioncouldhurtourreputation,forceustospendsignificantamountstodefendour
practices,distractourmanagementorotherwisehaveanadverseeffectonourbusiness.
Certainofourmarketingpracticesrelyupone-mailtocommunicatewithconsumersonourbehalf.Wemayfaceriskifouruseofe-mailisfoundtoviolatethe
applicablelaw.Wepostourprivacypolicyandpracticesconcerningtheuseanddisclosureofuserdataonourwebsites.Anyfailurebyustocomplywithour
postedprivacypolicyorotherprivacy-relatedlawsandregulationscouldresultinproceedingswhichcouldpotentiallyharmourbusiness.Inaddition,asdata
privacyandmarketinglawschange,wemayincuradditionalcoststoensureweremainincompliance.Ifapplicabledataprivacyandmarketinglawsbecomemore
restrictiveattheinternational,federal,provincialorstatelevels,ourcompliancecostsmayincrease,ourabilitytoeffectivelyengagecustomersviapersonalized
marketingmaydecrease,ourinvestmentinoure-commerceplatformmaynotbefullyrealized,ouropportunitiesforgrowthmaybecurtailedbyourcompliance
burdenandourpotentialreputationalharmorliabilityforsecuritybreachesmayincrease.
Data security breaches and other cyber security events could negatively affect our reputation, credibility and business.
Wecollect,process,maintainandusesensitivepersonalinformationrelatingtoourcustomersandemployees,includingtheirpersonallyidentifiableinformation,
andrelyonthirdpartiesfortheoperationofoure-commerce
24
Table of Contents
siteandforthevarioussocialmediatoolsandwebsitesweuseaspartofourmarketingstrategy.Anyperceived,attemptedoractualunauthorizeddisclosureof
personallyidentifiableinformationregardingouremployees,customersorwebsitevisitorscouldharmourreputationandcredibility,reduceoure-commercesales,
impairourabilitytoattractwebsitevisitors,reduceourabilitytoattractandretaincustomersandcouldresultinlitigationagainstusortheimpositionofsignificant
finesorpenalties.
Recently,datasecuritybreachessufferedbywell-knowncompaniesandinstitutionshaveattractedasubstantialamountofmediaattention,promptingnewforeign,
federal,provincialandstatelawsandlegislativeproposalsaddressingdataprivacyandsecurity,aswellasincreaseddataprotectionobligationsimposedon
merchantsbycreditcardissuers.Asaresult,wemaybecomesubjecttomoreextensiverequirementstoprotectthecustomerinformationthatweprocessin
connectionwiththepurchaseofourproducts,resultinginincreasedcompliancecosts.
Ouron-lineactivities,includingoure-commercewebsites,alsomaybesubjecttodenialofserviceorotherformsofcyberattacks.Whilewehavetakenmeasures
webelievereasonabletoprotectagainstthosetypesofattacks,thosemeasuresmaynotadequatelyprotectouron-lineactivitiesfromsuchattacks.Ifadenialof
serviceattackorothercybereventweretoaffectoure-commercesitesorotherinformationtechnologysystems,ourbusinesscouldbedisrupted,wemaylosesales
orvaluabledata,andourreputationmaybeadverselyaffected.
A significant portion of our business functions operate out of our headquarters in Toronto. As a result, our business is vulnerable to disruptions due to local
weather, economics and other factors.
AllofoursignificantbusinessfunctionsresideatourheadquartersinToronto,Canada.Eventssuchasextremelocalweather,naturaldisasters,transportation
strikes,actsofterrorism,significanteconomicdisruptionsorunexpecteddamagetothefacilitycouldresultinanunexpecteddisruptiontoourbusinessasa
whole.Althoughwecarrybusinessinterruptioninsurance,ifadisruptionofthistypeshouldoccur,ourabilitytoconductourbusinesscouldbeadverselyaffected
orinterruptedentirelyandadverselyaffectourfinancialandoperatingresults.
Our success is substantially dependent on the continued service of our senior management.
Oursuccessissubstantiallydependentonthecontinuedserviceofourseniormanagement,includingDaniReiss,whoisourthird-generationPresidentandChief
ExecutiveOfficer.Thelossoftheservicesofourseniormanagementcouldmakeitmoredifficulttosuccessfullyoperateourbusinessandachieveourbusiness
goals.Wealsomaybeunabletoretainexistingmanagement,technical,salesandclientsupportpersonnelthatarecriticaltooursuccess,whichcouldresultin
harmtoourcustomerandemployeerelationships,lossofkeyinformation,expertiseorknow-howandunanticipatedrecruitmentandtrainingcosts.
Wehavenotobtainedkeymanlifeinsurancepoliciesonanymembersofourseniormanagementteam.Asaresult,wewouldnotbeprotectedagainstthe
associatedfinanciallossifweweretolosetheservicesofmembersofourseniormanagementteam.
We rely on payment cards to receive payments, and are subject to payment-related risks.
ForourDTCsales,aswellasforsalestocertainretailpartners,weacceptavarietyofpaymentmethods,includingcreditcards,debitcardsandelectronicfunds
transfers.Accordingly,weare,andwillcontinuetobe,subjecttosignificantandevolvingregulationsandcompliancerequirementsrelatingtopaymentcard
processing.Thisincludeslawsgoverningthecollection,processingandstorageofsensitiveconsumerinformation,aswellasindustryrequirementssuchasthe
PaymentCardIndustryDataSecurityStandard,orPCI-DSS.Theselawsandobligationsmayrequireustoimplementenhancedauthenticationandpayment
processesthatcouldresultinincreasedcostsandliability,andreducetheeaseofuseofcertainpaymentmethods.Forcertainpaymentmethods,includingcredit
anddebitcards,wepayinterchangeandotherfees,whichmay
25
Table of Contents
increaseovertime.Werelyonindependentserviceprovidersforpaymentprocessing,includingcreditanddebitcards.Iftheseindependentserviceproviders
becomeunwillingorunabletoprovidetheseservicestousorifthecostofusingtheseprovidersincreases,ourbusinesscouldbeharmed.Wearealsosubjectto
paymentcardassociationoperatingrulesandagreements,includingPCI-DSS,certificationrequirementsandrulesgoverningelectronicfundstransfers,which
couldchangeorbereinterpretedtomakeitdifficultorimpossibleforustocomply.Ifwefailtocomplywiththeserulesorrequirements,orifourdatasecurity
systemsarebreachedorcompromised,wemaybeliableforlossesincurredbycardissuingbanksorconsumers,subjecttofinesandhighertransactionfees,lose
ourabilitytoacceptcreditordebitcardpaymentsfromourconsumers,orprocesselectronicfundtransfersorfacilitateothertypesofpayments.Anyfailureto
complycouldsignificantlyharmourbrand,reputation,business,andresultsofoperations.
If our independent manufacturers or our suppliers fail to use ethical business practices and fail to comply with changing laws and regulations or our
applicable guidelines, our brand image could be harmed due to negative publicity.
Ourcorevalues,whichincludedevelopingthehighestqualityproductswhileoperatingwithintegrity,areanimportantcomponentofourbrandimage,which
makesourreputationsensitivetoallegationsofunethicalorimproperbusinesspractices,whetherrealorperceived.Wedonotcontroloursuppliersand
manufacturersortheirbusinesspractices.Accordingly,wecannotguaranteetheircompliancewithourguidelinesorthelaw.Alackofcompliancecouldleadto
reducedsalesorrecallsordamagetoourbrandorcauseustoseekalternativesuppliers,whichcouldincreaseourcostsandresultindelayeddeliveryofour
products,productshortagesorotherdisruptionsofouroperations.
Inaddition,manyofourproductsincludematerialsthatareheavilyregulatedinmanyjurisdictions.Certainjurisdictionsinwhichwesellhavevariousregulations
relatedtomanufacturingprocessesandthechemicalcontentofourproducts,includingtheircomponentparts.Monitoringcompliancebyourmanufacturersand
suppliersiscomplicated,andwearereliantontheircompliancereportinginordertocomplywithregulationsapplicabletoourproducts.Thisisfurther
complicatedbythefactthatexpectationsofethicalbusinesspracticescontinuallyevolveandmaybesubstantiallymoredemandingthanapplicablelegal
requirements.Ethicalbusinesspracticesarealsodriveninpartbylegaldevelopmentsandbydiversegroupsactiveinpublicizingandorganizingpublicresponses
toperceivedethicalshortcomings.Accordingly,wecannotpredicthowsuchregulationsorexpectationsmightdevelopinthefutureandcannotbecertainthatour
guidelinesorcurrentpracticeswouldsatisfyallpartieswhoareactiveinmonitoringourproductsorotherbusinesspracticesworldwide.
Our current and future products may experience quality problems from time to time that can result in negative publicity, litigation, product recalls and
warranty claims, which could result in decreased revenue and operating margin, and harm to our brand.
Therecanbenoassurancewewillbeabletodetect,prevent,orfixalldefectsthatmayaffectourproducts.Failuretodetect,prevent,orfixdefects,orthe
occurrenceofrealorperceivedquality,healthorsafetyproblemsormaterialdefectsinourcurrentandfutureproducts,couldresultinavarietyofconsequences,
includingagreaternumberofproductreturnsthanexpectedfromcustomersandourretailpartners,litigation,productrecalls,andcredit,warrantyorotherclaims,
amongothers,whichcouldharmourbrand,sales,profitabilityandfinancialcondition.WestandbehindeveryCanadaGooseproductwithafulllifetimewarranty
againstdefects.Becauseofthiscomprehensivewarranty,qualityproblemscouldleadtoincreasedwarrantycosts,anddiverttheattentionofourmanufacturing
facilities.Suchproblemscouldhurtourpremiumbrandimage,whichiscriticaltomaintainingandexpandingourbusiness.Anynegativepublicityorlawsuitsfiled
againstusrelatedtotheperceivedqualityandsafetyofourproductscouldharmourbrandanddecreasedemandforourproducts.
26
Table of Contents
The cost of raw materials could increase our cost of goods sold and cause our results of operations and financial condition to suffer.
Thefabricsusedbyoursuppliersandmanufacturersincludesyntheticfabricsandnaturalproducts,includingcotton,polyester,downandcoyotefur.Significant
pricefluctuationsorshortagesinthecostoftheserawmaterialsmayincreaseourcostofgoodssoldandcauseourresultsofoperationsandfinancialconditionto
suffer.Inparticular,inourexperience,pricingforfurproductstendstobeunpredictable.Ifweareunabletosecurecoyotefurforourjacketsatareasonableprice,
wemayhavetoalterordiscontinuesellingsomeofourdesigns,orattempttopassalongthecosttoourcustomers,anyofwhichcouldadverselyaffectourresults
ofoperationsandfinancialcondition.
Additionally,increasingcostsoflabour,freightandenergycouldincreaseourandoursupplierscostofgoods.Ifoursuppliersareaffectedbyincreasesintheir
costsoflabour,freightandenergy,theymayattempttopassthesecostincreasesontous.Ifwepaysuchincreases,wemaynotbeabletooffsetthemthrough
increasesinourpricing,whichcouldadverselyaffectourresultsofoperationandfinancialcondition.
Fluctuations in foreign currency exchange rates could harm our results of operations as well as the price of our subordinate voting shares.
ThepresentationcurrencyforourconsolidatedfinancialstatementsistheCanadiandollar.BecausewerecognizesalesintheUnitedStatesinU.S.dollars,ifthe
U.S.dollarweakensagainsttheCanadiandollaritwouldhaveanegativeimpactonourU.S.operatingresultsupontranslationofthoseresultsintoCanadian
dollarsforthepurposesoffinancialstatementconsolidation.Wemayfacesimilarrisksinotherforeignjurisdictionswheresalesarerecognizedinforeign
currencies.Althoughweengageinshort-termhedgingtransactionsforalargeportionofourforeigncurrencydenominatedcashflowstomitigateforeignexchange
risks,dependinguponchangesinfuturecurrencyrates,suchgainsorlossescouldhaveasignificant,andpotentiallyadverse,effectonourresultsof
operations.Foreignexchangevariations(includingthevalueoftheCanadiandollarrelativetotheU.S.dollar)havebeensignificantinthepastandcurrentforeign
exchangeratesmaynotbeindicativeoffutureexchangerates.
OurearningspersharearereportedinCanadiandollars,andaccordinglymaybetranslatedintoU.S.dollarsbyanalystsorourinvestors.Asaresult,thevalueofan
investmentinoursubordinatevotingsharestoaU.S.shareholderwillfluctuateastheU.S.dollarrisesandfallsagainsttheCanadiandollar.Ourdecisiontodeclare
adividenddependsonresultsofoperationsreportedinCanadiandollars.Asaresult,U.S.andothershareholdersseekingU.S.dollartotalreturns,including
increasesinthesharepriceanddividendspaid,aresubjecttoforeignexchangeriskastheU.S.dollarrisesandfallsagainsttheCanadiandollar.
Unexpected obstacles in new markets may limit our expansion opportunities and cause our business and growth to suffer.
OurfuturegrowthdependsinpartonourexpansioneffortsoutsideofNorthAmerica.Wehavelimitedexperiencewithregulatoryenvironmentsandmarket
practicesoutsideofthisregion,andwemaynotbeabletopenetrateorsuccessfullyoperateinanynewmarket,asaresultofunfamiliarregulationorother
unexpected
27
Table of Contents
barrierstoentry.Inconnectionwithourexpansioneffortswemayencounterobstacles,includingculturalandlinguisticdifferences,differencesinregulatory
environments,economicorgovernmentalinstability,labourpracticesandmarketpractices,difficultiesinkeepingabreastofmarket,businessandtechnical
developments,andforeigncustomerstastesandpreferences.Wemayalsoencounterdifficultyexpandingintonewinternationalmarketsbecauseoflimitedbrand
recognitionleadingtodelayedacceptanceofourouterwearbycustomersinthesenewinternationalmarkets.Ourfailuretodevelopourbusinessinnew
internationalmarketsorexperiencingdisappointinggrowthoutsideofexistingmarketscouldharmourbusinessandresultsofoperations.
We are subject to many hazards and operational risks that can disrupt our business, some of which may not be insured or fully covered by insurance.
Ouroperationsaresubjecttomanyhazardsandoperationalrisksinherenttoourbusiness,including:generalbusinessrisks,productliability,productrecalland
damagetothirdparties,ourinfrastructureorpropertiescausedbyfires,floodsandothernaturaldisasters,powerlosses,telecommunicationsfailures,terrorist
attacks,humanerrorsandsimilarevents.
Ourinsurancecoveragemaybeinadequatetocoverourliabilitiesrelatedtosuchhazardsoroperationalrisks.Inaddition,wemaynotbeabletomaintainadequate
insuranceinthefutureatratesweconsiderreasonableandcommerciallyjustifiable,andinsurancemaynotcontinuetobeavailableontermsasfavorableasour
currentarrangements.Theoccurrenceofasignificantuninsuredclaim,oraclaiminexcessoftheinsurancecoveragelimitsmaintainedbyuscouldharmour
business,resultsofoperationsandfinancialcondition.
We will incur significant expenses and devote other significant resources and management time as a result of being a public company, which may negatively
impact our financial performance and could cause our results of operations and financial condition to suffer.
Wewillincursignificantlegal,accounting,insuranceandotherexpensesasaresultofbeingapubliccompany.TherulesimplementedbytheSecuritiesand
ExchangeCommission,orSEC,andbytheNYSE,andthesecuritiesregulatorsineachoftheprovincesandterritoriesofCanadaandbytheTSXhaverequired
changesincorporategovernancepracticesofpubliccompanies.Weexpectthatcompliancewiththeselaws,rulesandregulationswillsubstantiallyincreaseour
expenses,includingourlegalandaccountingcosts,andmakesomeactivitiesmoretime-consumingandcostly,andthesenewobligationswillrequireattention
fromourseniormanagementandcoulddiverttheirattentionawayfromtheday-to-daymanagementofourbusiness.Wealsoexpecttheselaws,rulesand
regulationstomakeitmoreexpensiveforustoobtaindirectorandofficerliabilityinsurance,andwemayberequiredtoacceptreducedpolicylimitsandcoverage
orincursubstantiallyhighercoststoobtainthesameorsimilarcoverage.Asaresult,itmaybemoredifficultforustoattractandretainqualifiedpersonstoserve
onourboardofdirectorsorasofficers.Asaresultoftheforegoing,weexpecta
28
Table of Contents
substantialincreaseinlegal,accounting,insuranceandcertainotherexpensesinthefuture,whichwillnegativelyimpactourfinancialperformanceandcouldcause
ourresultsofoperationsandfinancialconditiontosuffer.Furthermore,ifweareunabletosatisfyourobligationsasapubliccompany,wecouldbesubjectto
delistingofoursubordinatevotingshares,fines,sanctionsandotherregulatoryactionandpotentiallycivillitigation.
We have identified material weaknesses in our internal control over financial reporting and if we fail to remediate these weaknesses and maintain proper and
effective internal controls, our ability to produce accurate and timely financial statements could be impaired, which could harm our operating results, our
ability to operate our business and investors views of us.
Ensuringthatwehaveadequateinternalfinancialandaccountingcontrolsandproceduresinplacesothatwecanproduceaccuratefinancialstatementsonatimely
basisisacostlyandtime-consumingeffortthatneedstobeevaluatedfrequently.Asaprivatecompany,wehavenothistoricallypreparedpubliccompanyfinancial
statements.Inconnectionwiththeauditofourconsolidatedfinancialstatements,wehaveidentifiedmaterialweaknessesinourinternalcontroloverfinancial
reporting.Amaterialweaknessisadeficiency,oracombinationofdeficiencies,ininternalcontroloverfinancialreporting,suchthatthereisareasonable
possibilitythatamaterialmisstatementofthecompanysannualorinterimconsolidatedfinancialstatementswillnotbepreventedordetectedonatimelybasis.
Wedidnothaveinplaceaneffectivecontrolenvironmentwithformalprocessesandproceduresoranadequatenumberofaccountingpersonnelwiththe
appropriatetechnicaltrainingin,andexperiencewith,IFRStoallowforadetailedreviewofcomplexaccountingtransactionsthatwouldidentifyerrorsinatimely
manner,includinginventorycostingandbusinesscombinations.Wedidnotdesignormaintaineffectivecontrolsoverthefinancialstatementcloseandreporting
processinordertoensuretheaccurateandtimelypreparationoffinancialstatementsinaccordancewithIFRS.Inaddition,informationtechnologycontrols,
includingenduserandprivilegedaccessrightsandappropriatesegregationofduties,includingforcertainuserstheabilitytocreateandpostjournalentries,were
notdesignedoroperatingeffectively.
Wehavetakenstepstoaddressthesematerialweaknessesandcontinuetoimplementourremediationplan,whichwebelievewilladdresstheirunderlyingcauses.
Wehavehiredpersonnelwithrequisiteskillsinbothtechnicalaccountingandinternalcontroloverfinancialreporting.Inaddition,wehaveengagedexternal
advisorstoprovidefinancialaccountingassistanceintheshorttermandtoevaluateanddocumentthedesignandoperatingeffectivenessofourinternalcontrols
andassistwiththeremediationandimplementationofourinternalcontrolsasrequired.Weareevaluatingthelongertermresourceneedsofourvariousfinancial
functions.
Implementinganyappropriatechangestoourinternalcontrolsandcontinuingtoupdateandmaintainourinternalcontrolsmaydistractourofficersandemployees,
entailsubstantialcoststoimplementnewprocessesandmodifyourexistingprocessesandtakesignificanttimetocomplete.Ifwefailtoenhanceourinternal
controloverfinancialreportingtomeetthedemandsthatwillbeplaceduponusasapubliccompany,includingtherequirementsoftheSarbanes-OxleyActof
2002ortheSarbanes-OxleyAct,wemaybeunabletoreportourfinancialresultsaccurately,whichcouldincreaseoperatingcostsandharmourbusiness,including
ourinvestorsperceptionofourbusinessandourshareprice.Theactionsweplantotakearesubjecttocontinuedmanagementreviewsupportedbyconfirmation
andtesting,aswellasauditcommitteeoversight.Whileweexpecttofullyremediatethesematerialweaknesses,wecannotassureyouthatwewillbeabletodoso
inatimelymanner,whichcouldimpairourabilitytoreportourfinancialposition.Foramoredetaileddiscussionofourmaterialweaknesses,seeManagements
DiscussionandAnalysisofFinancialConditionandResultsofOperationsInternalControlOverFinancialReporting.
29
Table of Contents
Failure to maintain adequate financial and management processes and controls could lead to errors in our financial reporting, which could harm our business
and cause a decline in our share price.
Reportingobligationsasapubliccompanyandouranticipatedgrowthhaveplacedandarelikelytocontinuetoplaceaconsiderablestrainonourfinancialand
managementsystems,processesandcontrols,aswellasonourpersonnel.Inaddition,followingourfirstyearasapubliccompanywewillberequiredto
documentandtestourinternalcontrolsoverfinancialreportingpursuanttoSection404oftheSarbanes-OxleyActsothatourmanagementcancertifythe
effectivenessofourinternalcontrols.Asaresult,wewillberequiredtocontinuetoimproveourfinancialandmanagerialcontrols,reportingsystemsand
procedures,toincursubstantialexpensestotestoursystemsandtomakesuchimprovementsandtohireadditionalpersonnel.Ifourmanagementisunableto
certifytheeffectivenessofourinternalcontrolsorifadditionalmaterialweaknessesinourinternalcontrolsareidentified,wecouldbesubjecttoregulatory
scrutinyandalossofpublicconfidence,whichcouldharmourbusinessandcauseadeclineinourshareprice.Inaddition,ifwedonotmaintainadequatefinancial
andmanagementpersonnel,processesandcontrols,wemaynotbeabletoaccuratelyreportourfinancialperformanceonatimelybasis,whichcouldcausea
declineinoursharepriceandharmourabilitytoraisecapital.Failuretoaccuratelyreportourfinancialperformanceonatimelybasiscouldalsojeopardizeour
continuedlistingontheTSX,theNYSEoranyotherexchangeonwhichoursubordinatevotingsharesmaybelisted.Delistingofoursubordinatevotingshares
fromanyexchangewouldreducetheliquidityofthemarketforoursubordinatevotingshares,whichwouldreducethepriceofoursubordinatevotingsharesand
increasethevolatilityofourshareprice.
Wedonotexpectthatourdisclosurecontrolsandproceduresandinternalcontrolsoverfinancialreportingwillpreventallerrororfraud.Acontrolsystem,no
matterhowwell-designedandimplemented,canprovideonlyreasonable,notabsolute,assurancethatthecontrolsystemsobjectiveswillbemet.Further,the
designofacontrolsystemmustreflectthefactthatthereareresourceconstraints,andthebenefitsofcontrolsmustbeconsideredrelativetotheircosts.Duetothe
inherentlimitationsinallcontrolsystems,noevaluationofcontrolscanprovideabsoluteassurancethatallcontrolissueswithinanorganizationaredetected.Due
totheinherentlimitationsinacost-effectivecontrolsystem,misstatementsduetoerrororfraudmayoccurandmaynotbedetectedinatimelymanneroratall.If
wecannotprovidereliablefinancialreportsorpreventfraud,ourreputationandoperatingresultscouldbemateriallyadverselyaffected,whichcouldalsocause
investorstoloseconfidenceinourreportedfinancialinformation,whichinturncouldresultinareductioninthetradingpriceofthesubordinatevotingshares.
Inaddition,becauseofthe10-to-1votingratiobetweenourmultiplevotingsharesandsubordinatevotingshares,theholdersofourmultiplevotingshareswill
continuetocontrolamajorityofthecombinedvotingpowerofourvotingsharesevenwherethemultiplevotingsharesrepresentasubstantiallyreduced
percentageofourtotal
30
Table of Contents
outstandingshares.Theconcentratedvotingcontrolofholdersofourmultiplevotingshareswilllimittheabilityofoursubordinatevotingshareholdersto
influencecorporatemattersfortheforeseeablefuture,includingtheelectionofdirectorsaswellaswithrespecttodecisionsregardingamendingofourshare
capital,creatingandissuingadditionalclassesofshares,makingsignificantacquisitions,sellingsignificantassetsorpartsofourbusiness,mergingwithother
companiesandundertakingothersignificanttransactions.Asaresult,holdersofmultiplevotingshareswillhavetheabilitytoinfluenceorcontrolmanymatters
affectingusandactionsmaybetakenthatoursubordinatevotingshareholdersmaynotviewasbeneficial.Themarketpriceofoursubordinatevotingsharescould
beadverselyaffectedduetothesignificantinfluenceandvotingpoweroftheholdersofmultiplevotingshares.Additionally,thesignificantvotinginterestof
holdersofmultiplevotingsharesmaydiscouragetransactionsinvolvingachangeofcontrol,includingtransactionsinwhichaninvestor,asaholderofthe
subordinatevotingshares,mightotherwisereceiveapremiumforthesubordinatevotingsharesoverthethen-currentmarketprice,ordiscouragecompeting
proposalsifagoingprivatetransactionisproposedbyoneormoreholdersofmultiplevotingshares.
Futuretransfersbyholdersofmultiplevotingshares,otherthanpermittedtransferstosuchholdersrespectiveaffiliatesordirectfamilymembersortoother
permittedholders,willresultinthosesharesautomaticallyconvertingtosubordinatevotingshares,whichwillhavetheeffect,overtime,ofincreasingtherelative
votingpowerofthoseholdersofmultiplevotingshareswhoretaintheirmultiplevotingshares.SeeDescriptionofShareCapitalAuthorizedShareCapital
Conversion.
Bain Capital will continue to have significant influence over us after this offering, including control over decisions that require the approval of shareholders,
which could limit your ability to influence the outcome of matters submitted to shareholders for a vote.
Wearecurrentlycontrolled,andafterthisofferingiscompletedwillcontinuetobecontrolled,byBainCapital.Uponcompletionofthisoffering,BainCapitalwill
beneficiallyownapproximately70%ofouroutstandingmultiplevotingshares,orapproximately68%ofthecombinedvotingpowerofourmultiplevotingand
subordinatevotingsharesoutstandingafterthisoffering.Iftheunderwritersover-allotmentoptionisexercisedinfull,BainCapitalwillbeneficiallyown
approximately68%ofthecombinedvotingpowerofourmultiplevotingsharesandsubordinatevotingsharesoutstandingafterthisoffering.Inaddition,our
PresidentandChiefExecutiveOfficerwillbeneficiallyownapproximately30%ofouroutstandingmultiplevotingsharesorapproximately29%ofthecombined
votingpowerofouroutstandingvotingshares.AslongasBainCapitalownsorcontrolsatleastamajorityofouroutstandingvotingpower,itwillhavetheability
toexercisesubstantialcontroloverallcorporateactionsrequiringshareholderapproval,irrespectiveofhowourothershareholdersmayvote,includingtheelection
andremovalofdirectorsandthesizeofourboardofdirectors,anyamendmentofourcertificateofincorporation,noticeofarticlesandarticles,ortheapprovalof
anymergerorothersignificantcorporatetransaction,includingasaleofsubstantiallyallofourassets.Evenifitsownershipfallsbelow50%ofthevotingpowerof
ouroutstandingvotingshares,BainCapitalwillcontinuetobeabletostronglyinfluenceoreffectivelycontrolourdecisions.BainCapitalsmultiplevotingshares
convertautomaticallytosubordinatevotingsharesatthetimethatBainCapitalanditsaffiliatesnolongerbeneficiallyownatleast15%oftheoutstanding
subordinatesharesandmultiplevotingsharesonanon-dilutedbasis.EvenonceBainCapitalsmultiplevotingsharesconvertintosubordinatevotingshareswe
maycontinuetobeacontrolledcompanysolongasanentitycontrolledbyourPresidentandChiefExecutiveOfficercontinuestoholdmultiplevotingshares.See
DescriptionofShareCapital.
Additionally,BainCapitalsinterestsmaynotalignwiththeinterestsofourothershareholders.BainCapitalisinthebusinessofmakinginvestmentsincompanies
andmayacquireandholdinterestsinbusinessesthatcompetedirectlyorindirectlywithus.BainCapitalmayalsopursueacquisitionopportunitiesthatmaybe
complementarytoourbusiness,and,asaresult,thoseacquisitionopportunitiesmaynotbeavailabletous.
Followingthisoffering,ourauditcommitteewillberesponsibleforreviewingallrelatedpartytransactionsforpotentialconflictofinterestsituationsandapproving
allsuchtransactions.SeeCertainRelationshipsand
31
Table of Contents
RelatedPartyTransactionsReview,ApprovalorRatificationofTransactionswithRelatedParties.Ourauditcommitteewillconsistofdirectorswhoare
independentasrequiredbySECandtheNYSEListingRules,subjecttothepermittedphase-inperiodaffordedbysuchrules.Inaddition,ourcodeofethics,
followingthisoffering,willcontainprovisionsdesignedtoaddressconflictsofinterest.However,suchprovisionsmaynotbeeffectiveinlimitingBainCapitals
significantinfluenceoverus.
Upon the listing of our subordinate voting shares, we will be a controlled company within the meaning of the rules of the NYSE and, as a result, will qualify
for, and intend to rely on, exemptions from certain corporate governance requirements; you will not have the same protections afforded to shareholders of
companies that are subject to such requirements.
BecauseBainCapitalwillcontinuetocontrolamajorityofthecombinedvotingpowerofouroutstandingmultiplevotingsharesandsubordinatevotingshares
aftercompletionofthisoffering,wewillbeacontrolledcompanywithinthemeaningofthecorporategovernancestandardsoftheNYSE.Undertheserules,a
companyofwhichmorethan50%ofthevotingpowerfortheelectionofdirectorsisheldbyanindividual,grouporanothercompanyisacontrolledcompanyand
mayelectnottocomplywithcertaincorporategovernancerequirements,includingtherequirementsthat,withinoneyearofthedateofthelistingofour
subordinatevotingshares:
wehaveaboardofdirectorsthatiscomposedofamajorityofindependentdirectors,asdefinedundertheNYSEListingRules;
wehaveacompensationcommitteethatiscomposedentirelyofindependentdirectors;and
wehaveanominatingandgovernancecommitteethatiscomposedentirelyofindependentdirectors.
We are eligible to be treated as an emerging growth company, as defined in the Securities Act, and we cannot be certain if the reduced disclosure requirements
applicable to emerging growth companies will make our subordinate voting shares less attractive to investors.
Weareeligibletobetreatedasanemerginggrowthcompany,asdefinedinSection2(a)oftheSecuritiesAct,asmodifiedbytheJOBSAct,andwemaytake
advantageofcertainexemptionsfromvariousreportingrequirementsthatareapplicabletootherpubliccompaniesthatarenotemerginggrowthcompanies,
includingnotbeingrequiredtocomplywiththeauditorattestationrequirementsofSection404oftheSarbanes-OxleyAct,reduceddisclosureobligations
regardingexecutivecompensationandexemptionsfromtherequirementsofholdinganon-bindingshareholderadvisoryvoteonexecutivecompensationand
shareholderapprovalofanygoldenparachutepaymentsnotpreviouslyapproved.Asaresult,ourshareholdersmaynothaveaccesstocertaininformationthatthey
maydeemimportant.Wecouldbeanemerginggrowthcompanyforuptofiveyears,althoughcircumstancescouldcauseustolosethatstatusearlier,includingif
ourtotalannualgrossrevenuesexceedUS$1.0billion,ifweissuemorethanUS$1.0billioninnon-convertibledebtsecuritiesduringanythree-yearperiod,orifwe
arealargeacceleratedfilerandthemarketvalueofoursharesheldbynon-affiliatesexceedsUS$700millionasoftheendofanysecondquarterbeforethattime.
Wecannotpredictifinvestorswillfindoursubordinatevotingshareslessattractivebecausewemayrelyontheseexemptions.Ifsomeinvestorsfindour
subordinatevotingshareslessattractiveasaresult,theremaybealessactivetradingmarketforoursubordinatevotingsharesandoursharepricemaybemore
volatile.
As a foreign private issuer, we are not subject to certain U.S. securities law disclosure requirements that apply to a domestic U.S. issuer, which may limit the
information publicly available to our shareholders.
AsaforeignprivateissuerwearenotrequiredtocomplywithalloftheperiodicdisclosureandcurrentreportingrequirementsoftheExchangeActandtherefore
theremaybelesspubliclyavailableinformationaboutusthanifwewereaU.S.domesticissuer.Forexample,wearenotsubjecttotheproxyrulesintheUnited
StatesanddisclosurewithrespecttoourannualmeetingswillbegovernedbyCanadianrequirements.Inaddition,our
32
Table of Contents
officers,directorsandprincipalshareholdersareexemptfromthereportingandshort-swingprofitrecoveryprovisionsofSection16oftheExchangeActandthe
rulesthereunder.Therefore,ourshareholdersmaynotknowonatimelybasiswhenourofficers,directorsandprincipalshareholderspurchaseorsellour
subordinatevotingshares.Furthermore,asaforeignprivateissuer,wemaytakeadvantageofcertainprovisionsintheNYSEListingRulesthatallowustofollow
Canadianlawforcertaingovernancematters.
If you purchase subordinate voting shares in this offering, you will suffer immediate and substantial dilution of your investment.
Theinitialpublicofferingpriceofoursubordinatevotingsharesissubstantiallyhigherthanthenettangiblebookdeficitpersubordinatevotingshare.Therefore,if
youpurchaseoursubordinatevotingsharesinthisoffering,youwillpayapricepersharethatsubstantiallyexceedsourproformanettangiblebookdeficitper
shareafterthisoffering.Basedontheinitialpublicofferingpriceof$17.00pershare,youwillexperienceimmediatedilutionof$17.19persubordinatevoting
share,representingthedifferencebetweenourproformanettangiblebookdeficitpersubordinatevotingshareaftergivingeffecttothisofferingandtheinitial
publicofferingprice.
Wealsohaveanumberofoutstandingoptionstopurchasesubordinatevotingshareswithexercisepricesthatarebelowtheinitialpublicofferingpriceofour
subordinatevotingshares.Totheextentthattheseoptionsareexercised,youwillexperiencefurtherdilution.SeeDilutionformoredetail.
We cannot assure you that a market will develop for our subordinate voting shares or what the price of our subordinate voting shares will be. Investors may not
be able to resell their subordinate voting shares at or above the initial public offering price.
Beforethisoffering,therewasnopublictradingmarketforoursubordinatevotingshares,andwecannotassureyouthatonewilldeveloporbesustainedafterthis
offering.Ifamarketdoesnotdeveloporisnotsustained,itmaybedifficultforyoutosellyoursubordinatevotingshares.Thismayaffectthepricingofthe
subordinatevotingsharesinthesecondarymarket,thetransparencyandavailabilityoftradingprices,theliquidityofthesubordinatevotingsharesandtheextent
ofregulationapplicabletous.Wecannotpredictthepricesatwhichoursubordinatevotingshareswilltrade.Theinitialpublicofferingpriceforoursubordinate
votingshareswillbedeterminedthroughournegotiationswiththeunderwritersandmaynotbearanyrelationshiptothemarketpriceatwhichoursubordinate
votingshareswilltradeafterthisofferingortoanyotherestablishedcriteriaofthevalueofourbusiness.Itispossiblethat,infuturequarters,ouroperatingresults
maybebelowtheexpectationsofsecuritiesanalystsandinvestors.Asaresultoftheseandotherfactors,thepriceofoursubordinatevotingsharesmaydecline,
possiblymaterially.
Our operating results and share price may be volatile, and the market price of our subordinate voting shares after this offering may drop below the price you
pay.
Ourquarterlyoperatingresultsarelikelytofluctuateinthefutureinresponsetonumerousfactors,manyofwhicharebeyondourcontrol,includingeachofthe
factorssetforthabove.
Inaddition,securitiesmarketsworldwidehaveexperienced,andarelikelytocontinuetoexperience,significantpriceandvolumefluctuations.Thismarket
volatility,aswellasgeneraleconomic,marketorpoliticalconditions,couldsubjectthemarketpriceofoursubordinatevotingsharestowidepricefluctuations
regardlessofouroperatingperformance.Ouroperatingresultsandthetradingpriceofoursubordinatevotingsharesmayfluctuateinresponsetovariousfactors,
includingtherisksdescribedabove.
Theseandotherfactors,manyofwhicharebeyondourcontrol,maycauseouroperatingresultsandthemarketpriceanddemandforoursubordinatevotingshares
tofluctuatesubstantially.Fluctuationsinourquarterly
33
Table of Contents
operatingresultscouldlimitorpreventinvestorsfromreadilysellingtheirsubordinatevotingsharesandmayotherwisenegativelyaffectthemarketpriceand
liquidityofsubordinatevotingshares.Inaddition,inthepast,whenthemarketpriceofastockhasbeenvolatile,holdersofthatstockhavesometimesinstituted
securitiesclassactionlitigationagainstthecompanythatissuedtheshares.Ifanyofourshareholdersbroughtalawsuitagainstus,wecouldincursubstantialcosts
defendingthelawsuit.Suchalawsuitcouldalsodivertthetimeandattentionofourmanagementfromourbusiness,whichcouldsignificantlyharmour
profitabilityandreputation.
A significant portion of our total outstanding shares are restricted from immediate resale but may be sold into the market in the near future. This could cause
the market price of our subordinate voting shares to drop significantly, even if our business is doing well.
Salesofasubstantialnumberofoursubordinatevotingsharesinthepublicmarketcouldoccuratanytime.Thesesales,ortheperceptioninthemarketthatthe
holdersofalargenumberofsubordinatevotingsharesorsecuritiesconvertibleintosubordinatevotingsharesintendtosellsubordinatevotingshares,couldreduce
themarketpriceofoursubordinatevotingshares.Aftergivingeffecttothisoffering,wewillhaveoutstanding20,000,000subordinatevotingshares(23,000,000if
theunderwritersexercisetheirover-allotmentoption),whichmayberesoldinthepublicmarketimmediately,andassumesnoexercisesofoutstandingoptions.
Followingtheconsummationofthisoffering,sharesthatarenotbeingsoldinthisofferingwillbesubjecttoa180daylock-upperiodprovidedunderlock-up
agreementsexecutedinconnectionwiththisofferingdescribedinUnderwritingandrestrictedfromimmediateresaleunderU.S.federalsecuritieslawsand,in
certaincases,CanadiansecuritieslawsasdescribedinSharesEligibleforFutureSale.Alloftheseshareswill,however,beabletoberesoldaftertheexpiration
ofthelock-upperiod,aswellaspursuanttocustomaryexceptionstheretooruponthewaiverofthelock-upagreementbycertainoftheunderwriters.Wealso
intendtoregister11,000,000subordinatevotingsharesthatwemayissueunderourequitycompensationplans.Onceweregisterthesesubordinatevotingshares,
theycanbefreelysoldinthepublicmarketuponissuance,subjecttothelock-upagreements.Asrestrictionsonresaleend,themarketpriceofoursubordinate
votingsharescoulddeclineiftheholdersofcurrentlyrestrictedsubordinatevotingsharessellthemorareperceivedbythemarketasintendingtosellthem.
Because we have no current plans to pay regular cash dividends on our subordinate voting shares following this offering, you may not receive any return on
investment unless you sell your subordinate voting shares for a price greater than that which you paid for it.
Wedonotanticipatepayinganyregularcashdividendsonoursubordinatevotingsharesfollowingthisoffering.Anydecisiontodeclareandpaydividendsinthe
futurewillbemadeatthediscretionofourboardofdirectorsandwilldependon,amongotherthings,ourresultsofoperations,financialcondition,cash
requirements,contractualrestrictionsandotherfactorsthatourboardofdirectorsmaydeemrelevant.Inaddition,ourabilitytopaydividendsis,andmaybe,
limitedbycovenantsofexistingandanyfutureoutstandingindebtednessweoroursubsidiariesincur.Therefore,anyreturnoninvestmentinoursubordinate
votingsharesissolelydependentupontheappreciationofthepriceofoursubordinatevotingsharesontheopenmarket,whichmaynotoccur.SeeDividend
Policyformoredetail.
Our articles, and certain Canadian legislation contain provisions that may have the effect of delaying or preventing a change in control.
Certainprovisionsofourarticles,togetherorseparately,coulddiscouragepotentialacquisitionproposals,delayorpreventachangeincontrolandlimittheprice
thatcertaininvestorsmaybewillingtopayforoursubordinatevotingshares.Forinstance,ourarticlescontainprovisionsthatestablishcertainadvancenotice
proceduresfornominationofcandidatesforelectionasdirectorsatshareholdersmeetings.Anon-CanadianmustfileanapplicationforreviewwiththeMinister
responsiblefortheInvestment Canada Act andobtainapprovaloftheMinisterpriortoacquiringcontrolofaCanadianbusinesswithinthemeaningofthe
Investment Canada Act ,
34
Table of Contents
whereprescribedfinancialthresholdsareexceeded.Furthermore,limitationsontheabilitytoacquireandholdoursubordinatevotingsharesandmultiplevoting
sharesmaybeimposedbytheCompetition Act (Canada).ThislegislationpermitstheCommissionerofCompetition,orCommissioner,toreviewanyacquisitionor
establishment,directlyorindirectly,includingthroughtheacquisitionofshares,ofcontroloverorofasignificantinterestinus.Otherwise,therearenolimitations
eitherunderthelawsofCanadaorBritishColumbia,orinourarticlesontherightsofnon-Canadianstoholdorvoteoursubordinatevotingsharesandmultiple
votingshares.Anyoftheseprovisionsmaydiscourageapotentialacquirerfromproposingorcompletingatransactionthatmayhaveotherwisepresenteda
premiumtoourshareholders.SeeDescriptionofShareCapitalCertainImportantProvisionsofOurArticlesandtheBCBCA.
Because we are a corporation incorporated in British Columbia and some of our directors and officers are resident in Canada, it may be difficult for investors
in the United States to enforce civil liabilities against us based solely upon the federal securities laws of the United States. Similarly, it may be difficult for
Canadian investors to enforce civil liabilities against our directors and officers residing outside of Canada.
WeareacorporationincorporatedunderthelawsofBritishColumbiawithourprincipalplaceofbusinessinToronto,Canada.Someofourdirectorsandofficers
andtheauditorsorotherexpertsnamedhereinareresidentsofCanadaandallorasubstantialportionofourassetsandthoseofsuchpersonsarelocatedoutsidethe
UnitedStates.Consequently,itmaybedifficultforU.S.investorstoeffectserviceofprocesswithintheUnitedStatesuponusorourdirectorsorofficersorsuch
auditorswhoarenotresidentsoftheUnitedStates,ortorealizeintheUnitedStatesuponjudgmentsofcourtsoftheUnitedStatespredicateduponcivilliabilities
undertheSecuritiesAct.InvestorsshouldnotassumethatCanadiancourts:(1)wouldenforcejudgmentsofU.S.courtsobtainedinactionsagainstusorsuch
personspredicateduponthecivilliabilityprovisionsoftheU.S.federalsecuritieslawsorthesecuritiesorblueskylawsofanystatewithintheUnitedStatesor(2)
wouldenforce,inoriginalactions,liabilitiesagainstusorsuchpersonspredicatedupontheU.S.federalsecuritieslawsoranysuchstatesecuritiesorblueskylaws.
Similarly,someofourdirectorsandofficersareresidentsofcountriesotherthanCanadaandallorasubstantialportionoftheassetsofsuchpersonsarelocated
outsideCanada.Asaresult,itmaybedifficultforCanadianinvestorstoinitiatealawsuitwithinCanadaagainstthesenon-Canadianresidents.Inaddition,itmay
notbepossibleforCanadianinvestorstocollectfromthesenon-CanadianresidentsjudgmentsobtainedincourtsinCanadapredicatedonthecivilliability
provisionsofsecuritieslegislationofcertainoftheprovincesandterritoriesofCanada.ItmayalsobedifficultforCanadianinvestorstosucceedinalawsuitinthe
UnitedStates,basedsolelyonviolationsofCanadiansecuritieslaws.
Changes in U.S. tax laws and regulations or trade rules may impact our effective tax rate and may adversely affect our business, financial condition and
operating results.
Changesintaxlawsinanyofthemultiplejurisdictionsinwhichweoperate,oradverseoutcomesfromtaxauditsthatwemaybesubjecttoinanyofthe
jurisdictionsinwhichweoperate,couldresultinanunfavorablechangeinoureffectivetaxrate,whichcouldadverselyaffectourbusiness,financialconditionand
operatingresults.Additionally,resultsoftheNovember2016U.S.electionshaveintroducedgreateruncertaintywithrespecttotaxandtradepolicies,tariffsand
governmentregulationsaffectingtradebetweentheUnitedStatesandothercountries.Majordevelopmentsintaxpolicyortraderelations,suchastherenegotiation
oftheNorthAmericanFreeTradeAgreementortheimpositionofunilateraltariffsonimportedproducts,couldhaveamaterialadverseeffectonourgrowth
opportunities,businessandresultsofoperations.
There could be adverse tax consequence for our shareholders in the United States if we are a passive foreign investment company.
UnderUnitedStatesfederalincometaxlaws,ifacompanyis,orforanypastperiodwas,apassiveforeigninvestmentcompany,orPFIC,itcouldhaveadverse
UnitedStatesfederalincometaxconsequencestoU.S.
35
Table of Contents
shareholdersevenifthecompanyisnolongeraPFIC.ThedeterminationofwhetherweareaPFICisafactualdeterminationmadeannuallybasedonallthefacts
andcircumstancesandthusissubjecttochange,andtheprinciplesandmethodologyusedindeterminingwhetheracompanyisaPFICaresubjecttointerpretation.
WedonotbelievethatwecurrentlyareorhavebeenaPFIC,andwedonotexpecttobeaPFICinthefuture,butwecannotassureyouthatwewillnotbeaPFIC
inthefuture.UnitedStatespurchasersofoursubordinatevotingsharesareurgedtoconsulttheirtaxadvisorsconcerningUnitedStatesfederalincometax
consequencesofholdingoursubordinatevotingsharesifweareconsideredtobeaPFIC.SeethediscussionunderMaterialUnitedStatesFederalIncomeTax
ConsiderationsforU.S.Holders.
IfweareaPFIC,U.S.holderswouldbesubjecttoadverseU.S.federalincometaxconsequences,suchasineligibilityforanypreferredtaxratesoncapitalgainsor
onactualordeemeddividends,interestchargesoncertaintaxestreatedasdeferred,andadditionalreportingrequirementsunderU.S.federalincometaxlawsor
regulations.WhetherornotU.S.holdersmakeatimelyqualifiedelectingfund,orQEF,electionormark-to-marketelectionmayaffecttheU.S.federalincometax
consequencestoU.S.holderswithrespecttotheacquisition,ownershipanddispositionofoursubordinatevotingsharesandanydistributionssuchU.S.holders
mayreceive.InvestorsshouldconsulttheirowntaxadvisorsregardingallaspectsoftheapplicationofthePFICrulestooursubordinatevotingshares.
Canada Goose Holdings Inc. is a holding company with no operations of its own and, as such, it depends on its subsidiary for cash to fund its operations and
expenses, including future dividend payments, if any.
Asaholdingcompany,ourprincipalsourceofcashflowwillbedistributionsfromouroperatingsubsidiary,CanadaGoose,Inc.Therefore,ourabilitytofundand
conductourbusiness,serviceourdebtandpaydividends,ifany,inthefuturewilldependontheabilityofoursubsidiarytogeneratesufficientcashflowtomake
upstreamcashdistributionstous.Oursubsidiaryisaseparatelegalentity,andalthoughitiswholly-ownedandcontrolledbyus,ithasnoobligationtomakeany
fundsavailabletous,whetherintheformofloans,dividendsorotherwise.Theabilityofoursubsidiarytodistributecashtouswillalsobesubjectto,amongother
things,restrictionsthatmaybecontainedinoursubsidiaryagreements(asenteredintofromtimetotime),availabilityofsufficientfundsinsuchsubsidiaryand
applicablelawsandregulatoryrestrictions.Claimsofanycreditorsofoursubsidiarygenerallywillhavepriorityastotheassetsofsuchsubsidiaryoverourclaims
andclaimsofourcreditorsandshareholders.Totheextenttheabilityofoursubsidiarytodistributedividendsorotherpaymentstousislimitedinanyway,our
abilitytofundandconductourbusiness,serviceourdebtandpaydividends,ifany,couldbeharmed.
If securities or industry analysts do not publish or cease publishing research or reports about us, our business or our market, or if they change their
recommendations regarding our subordinate voting shares adversely, the price and trading volume of our subordinate voting shares could decline.
Thetradingmarketforoursubordinatevotingsharesisinfluencedbytheresearchandreportsthatindustryorsecuritiesanalystspublishaboutus,ourbusiness,our
marketorourcompetitors.Ifanyoftheanalystswhocoverusormaycoverusinthefuturechangetheirrecommendationregardingoursubordinatevotingshares
adversely,orprovidemorefavorablerelativerecommendationsaboutourcompetitors,thepriceofoursubordinatevotingshareswouldlikelydecline.Ifany
analystwhocoversusormaycoverusinthefutureweretoceasecoverageofourcompanyorfailtoregularlypublishreportsonus,wecouldlosevisibilityinthe
financialmarkets,whichinturncouldcausethepriceortradingvolumeofoursubordinatevotingsharestodecline.
Our constating documents permit us to issue an unlimited number of subordinate voting shares and multiple voting shares without additional shareholder
approval.
Ourarticlespermitustoissueanunlimitednumberofsubordinatevotingsharesandmultiplevotingshares.Weanticipatethatwewill,fromtimetotime,issue
additionalsubordinatevotingsharesinthefuture.SubjecttotherequirementsoftheNYSEandtheTSX,wewillnotberequiredtoobtaintheapprovalof
shareholdersforthe
36
Table of Contents
issuanceofadditionalsubordinatevotingshares.AlthoughtherulesoftheTSXgenerallyprohibitusfromissuingadditionalmultiplevotingshares,theremaybe
certaincircumstanceswhereadditionalmultiplevotingsharesmaybeissued,includinguponreceivingshareholderapproval.Anyfurtherissuancesofsubordinate
votingsharesormultiplevotingshareswillresultinimmediatedilutiontoexistingshareholdersandmayhaveanadverseeffectonthevalueoftheirshareholdings.
Additionally,anyfurtherissuancesofmultiplevotingsharesmaysignificantlylessenthecombinedvotingpowerofoursubordinatevotingsharesduetothe
10-to-1votingratiobetweenourmultiplevotingsharesandsubordinatevotingshares.
37
Table of Contents
Thisprospectuscontainsforward-lookingstatements.Forward-lookingstatementsareneitherhistoricalfactsnorassurancesoffutureperformance.Instead,they
arebasedonourcurrentbeliefs,expectationsandassumptionsregardingthefutureofourbusiness,futureplansandstrategies,andotherfutureconditions.
Forward-lookingstatementscanbeidentifiedbywordssuchasanticipate,believe,envision,estimate,expect,intend,may,plan,predict,
project,target,potential,will,would,could,should,continue,contemplateandothersimilarexpressions,althoughnotallforward-looking
statementscontaintheseidentifyingwords.Theseforward-lookingstatementsincludeallmattersthatarenothistoricalfacts.Theyappearinanumberofplaces
throughoutthisprospectusandincludestatementsregardingourintentions,beliefsorcurrentexpectationconcerning,amongotherthings,ourresultsofoperations,
financialcondition,liquidity,prospects,growth,strategiesandtheindustryinwhichweoperate.Forward-lookingstatementscontainedinthisprospectusinclude,
amongotherthings,statementsrelatingto:
expectationsregardingindustrytrendsandthesizeandgrowthratesofaddressablemarkets;
ourbusinessplanandourgrowthstrategies,includingplansforexpansiontonewmarketsandnewproducts;
expectationsforseasonaltrends;and
theproposeduseofproceedsfromthisoffering.
Althoughwebasetheforward-lookingstatementscontainedinthisprospectusonassumptionsthatwebelievearereasonable,wecautionyouthatactualresultsand
developments(includingourresultsofoperations,financialconditionandliquidity,andthedevelopmentoftheindustryinwhichweoperate)maydiffermaterially
fromthosemadeinorsuggestedbytheforward-lookingstatementscontainedinthisprospectus.Inaddition,evenifresultsanddevelopmentsareconsistentwith
theforward-lookingstatementscontainedinthisprospectus,thoseresultsanddevelopmentsmaynotbeindicativeofresultsordevelopmentsinsubsequent
periods.Certainassumptionsmadeinpreparingtheforward-lookingstatementscontainedinthisprospectusinclude:
ourabilitytoimplementourgrowthstrategies;
ourabilitytomaintaingoodbusinessrelationshipswithoursuppliers,wholesalersanddistributors;
ourabilitytokeeppacewithchangingconsumerpreferences;
ourabilitytoprotectourintellectualproperty;and
theabsenceofmaterialadversechangesinourindustryortheglobaleconomy.
Bytheirnature,forward-lookingstatementsinvolverisksanduncertaintiesbecausetheyrelatetoeventsanddependoncircumstancesthatmayormaynotoccurin
thefuture.Webelievethattheserisksanduncertaintiesinclude,butarenotlimitedto,thosedescribedintheRiskFactorssectionofthisprospectusbeginningon
page17,whichinclude,butarenotlimitedto,thefollowingrisks:
wemaybeunabletomaintainthestrengthofourbrandortoexpandourbrandtonewproductsandgeographies;
wemaybeunabletoprotectorpreserveourbrandimageandproprietaryrights;
wemaynotbeabletosatisfychangingconsumerpreferences;
aneconomicdownturnmayaffectdiscretionaryconsumerspending;
wemaynotbeabletocompeteinourmarketseffectively;
wemaynotbeabletomanageourgrowtheffectively;
poorperformanceduringourpeakseasonmayaffectouroperatingresultsforthefullyear;
38
Table of Contents
ourindebtednessmayadverselyaffectourfinancialcondition;
ourabilitytomaintainrelationshipswithourselectnumberofsuppliers;
ourabilitytomanageourproductdistributionthroughourretailpartnersandinternationaldistributors;
thesuccessofourmarketingprograms;
theriskourbusinessisinterruptedbecauseofadisruptionatourheadquarters;and
fluctuationsinrawmaterialscostsorcurrencyexchangerates.
Thesefactorsshouldnotbeconstruedasexhaustiveandshouldbereadwiththeothercautionarystatementsinthisprospectus.Althoughwehaveattemptedto
identifyimportantriskfactors,theremaybeotherriskfactorsnotpresentlyknowntousorthatwepresentlybelievearenotmaterialthatcouldalsocauseactual
resultsanddevelopmentstodiffermateriallyfromthosemadeinorsuggestedbytheforward-lookingstatementscontainedinthisprospectus.Ifanyofthethese
risksmaterialize,orifanyoftheaboveassumptionsunderlyingforward-lookingstatementsproveincorrect,actualresultsanddevelopmentsmaydiffermaterially
fromthosemadeinorsuggestedbytheforward-lookingstatementscontainedinthisprospectus.
Giventheserisksanduncertainties,youarecautionednottoplacesubstantialweightorunduerelianceontheseforward-lookingstatementswhenmakingan
investmentdecision.Anyforward-lookingstatementthatwemakeinthisprospectusspeaksonlyasofthedateofthisprospectus,and,exceptasrequiredbylaw,
weundertakenoobligationtoupdateanyforward-lookingstatementsortopubliclyannouncetheresultsofanyrevisionstoanyofthosestatementstoreflectfuture
eventsordevelopments.Comparisonsofresultsforcurrentandanypriorperiodsarenotintendedtoexpressanyfuturetrendsorindicationsoffutureperformance,
unlessspecificallyexpressedassuch,andshouldonlybeviewedashistoricaldata.
Anyreferencestoforward-lookingstatementsinthisprospectusincludeforward-lookinginformationwithinthemeaningofapplicableCanadiansecuritieslaws.
39
Table of Contents
Thefollowingtablesetsforth,foreachperiodindicated,thehighandlowexchangerateforU.S.dollarsexpressedinCanadiandollars,andtheaverageexchange
ratefortheperiodsindicated.Averagesforyear-endperiodsarecalculatedbyusingtheexchangeratesonthelastdayofeachfullmonthduringtherelevantperiod
andthelastavailableexchangerateinMarchduringtherelevantfiscalyear.Theseratesarebasedonthenoonbuyingratecertifiedforcustompurposesbythe
U.S.FederalReserveBankofNewYorksetforthintheH.10statisticalreleaseoftheFederalReserveBoard.Theseratesareprovidedsolelyforyourconvenience
andarenotnecessarilytheexchangeratesthatweusedinpreparationofourconsolidatedfinancialstatementsorelsewhereinthisprospectusorwilluseinthe
preparationofourperiodicreportsoranyotherinformationtobeprovidedtoyou.WemakenorepresentationthatanyCanadiandollarorU.S.dollaramounts
referredtointhisprospectuscouldhavebeenorcouldbeconvertedintoU.S.dollarsorCanadiandollars,asthecasemaybe,atanyparticularrateoratall.
OnMarch3,2017,thenoonbuyingratewasUS$1.00=$1.3419.
Year Ended Period End Period Average Rate High Rate Low Rate
March31,2014 $ 1.1053 $ 1.0580 $ 1.1251 $ 1.0023
March31,2015 $ 1.2681 $ 1.1471 $ 1.2803 $ 1.0633
March31,2016 $ 1.2969 $ 1.3128 $ 1.4592 $ 1.1950
40
Table of Contents
Use of Proceeds
Weestimatethatthenetproceedstousfromourissuanceandsaleof6,308,154subordinatevotingsharesinthisofferingwillbeapproximately$100million,after
deductingunderwritingcommissions,basedonaninitialpublicofferingpriceof$17.00pershare.
Wewillnotreceiveanyproceedsfromthesaleofsubordinatevotingsharesbythesellingshareholders.Afterdeductingunderwritingcommissions,theselling
shareholderswillreceiveapproximately$217.0millionofnetproceedsfromthisoffering(orapproximately$264.6millioniftheunderwritersexercisetheirover-
allotmentoptioninfull).
Weintendtousetheproceedsfromthisofferingtorepay$65.0millionofouroutstandingindebtednessunderourTermLoanFacilityand$35.0millionof
outstandingindebtednessunderourRevolvingFacility.TheloanscurrentlyoutstandingundertheRevolvingFacility,whichmaturesinJune2021,areLIBOR
Loans,bearinginterestat2.73%.TheRevolvingFacilitywasinitiallyusedtorepayandextinguishourpriorsecuredcreditfacility.WeuseourRevolvingFacility
inthenormalcourseasasourceofliquidityforshort-termworkingcapitalneedsandgeneralcorporatepurposes.ThetermloansundertheTermLoanFacility,
whichmatureinDecember2021,currentlybearinterestattheLIBORRate(subjecttoaminimumrateof1.00%perannum)plusanApplicableMarginof5.00%.
TheproceedsofthetermloansborrowedundertheTermLoanFacilitywereusedtoeffectthestepsdescribedinthisprospectusunderRecapitalization,topay
transactionexpensesinconnectionwiththeclosingoftheTermLoanFacilityandforothergeneralcorporatepurposes.SeeDescriptionofIndebtedness,
RecapitalizationandCertainRelationshipsandRelatedPartyTransactions.
41
Table of Contents
Dividend Policy
Priortothecompletionofthisoffering,inconnectionwiththeRecapitalization,wemadecertaindistributionsonourthenoutstandingclassesofcommonshares.
SeeRecapitalization.Followingcompletionoftheoffering,ourboardofdirectorsdoesnotcurrentlyintendtopaydividendsonoursubordinatevotingsharesor
multiplevotingshares.Wecurrentlyintendtoretainanyfutureearningstofundbusinessdevelopmentandgrowth,andwedonotexpecttopayanydividendsin
theforeseeablefuture.Anyfuturedeterminationtodeclarecashdividendswillbemadeatthediscretionofourboardofdirectors,subjecttoapplicablelaws,and
willdependonanumberoffactors,includingourfinancialcondition,resultsofoperations,capitalrequirements,contractualrestrictions,generalbusiness
conditionsandotherfactorsthatourboardofdirectorsmaydeemrelevant.Currently,theprovisionsofourseniorsecuredcreditfacilitiesplacecertainlimitations
ontheamountofcashdividendsthatouroperatingsubsidiarycanpay.SeeDescriptionofIndebtedness.
42
Table of Contents
Recapitalization
OnDecember2,2016wecompletedaseriesoftransactions,whichwecollectivelyrefertoastheRecapitalization,includingthefollowingsequentialstepsin
whichwe:
enteredintotermloansundertheTermLoanFacilityofapproximately$216.7million,thetermsofwhicharedescribedunderDescriptionof
IndebtednessTermLoanFacility;
repaidallamountsoutstanding,includingallaccruedinterest,underourSeniorConvertibleSubordinatedNoteandourJuniorConvertible
SubordinatedNote,eachdatedDecember9,2013,totalingapproximately$91.0million;
redeemedallofourissuedandoutstandingClassASeniorPreferredSharesinexchangeforapaymentofapproximately$53.1million;
redeemedallofourissuedandoutstandingClassAJuniorPreferredSharesinexchangeforapaymentofapproximately$4.1million;
effecteda1-for-10,000,000splitofourClassACommonShares,anda1-for-10,000,000splitofourClassBCommonShares;
effectedareturnofcapitaltotheholdersofourClassACommonSharesintheamountofapproximately$0.7million;
exchangedalloftheissuedandoutstandingClassBSeniorPreferredShares,ClassBJuniorPreferredSharesandClassBCommonSharesintoClass
DPreferredShareswithafixedredemptionvalueofapproximately$63.6millionand30,000,000ClassACommonShares;
issuedasecured,non-interestbearingloanofapproximately$63.6milliontoDTRLLC,anentityindirectlycontrolledbyourPresidentandChief
ExecutiveOfficer,asevidencedbytheDTRPromissoryNote,forwhichDTRLLCpledgedalloftheClassDPreferredSharesheldbyDTRLLCin
favorofCGHI;and
madeadjustmentsinaccordancewiththeCanadaGooseHoldingsInc.StockOptionPlan,whichwasestablishedin2013,to(i)convertalloutstanding
optionstopurchaseClassBCommonSharesandClassAJuniorPreferredSharesintooptionstopurchaseClassACommonShares,and(ii)reduce
theexercisepriceofcertainoptionsand/orissuenewoptionstocertainoptionholders.
OnJanuary31,2017,allofourClassDPreferredShareswereredeemedbythecompanyforcancellationandtheDTRPromissoryNotewasextinguishedin
exchangefortheredemptionoftheClassDPreferredShares.SeeCertainRelationshipsandRelatedPartyTransactions.
Inconnectionwiththisofferingweamendedourarticlesinorderto,amongotherthings:
amendandredesignateourClassACommonSharesasmultiplevotingshares;
eliminateourClassBCommonShares,ClassASeniorPreferredShares,ClassBSeniorPreferredShares,ClassAJuniorPreferredShares,ClassB
JuniorPreferredShares,ClassCJuniorPreferredSharesandtheClassDPreferredSharesfromoursharecapital;and
createoursubordinatevotingshares.SeeDescriptionofShareCapital.
43
Table of Contents
Capitalization
ThefollowingtablesetsforthourcashandcapitalizationatDecember31,2016:
onanactualbasis;and
onaproformaasadjustedbasistogiveeffectto(1)theredesignationofourClassACommonSharesasmultiplevotingsharesandcreationofour
subordinatevotingshares,(2)theissuanceofsubordinatevotingsharesbyusinthisofferingbasedupontheinitialpublicofferingpriceof$17.00per
subordinatevotingshareandtheapplicationoftheestimatednetproceedsfromtheofferingasdescribedinUseofProceedsand(3)thepaymentof
approximately$9.6millionoutofavailablecashinfeesunderourmanagementagreementinconnectionwiththeofferingandterminationofthe
managementagreement,asdescribedunderCertainRelationshipsandRelatedPartyTransactionsManagementAgreement.
YoushouldreadthistableinconjunctionwiththeinformationcontainedinUseofProceeds,SelectedHistoricalConsolidatedFinancialDataand
ManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperations,aswellasourconsolidatedfinancialstatementsandtherelatednotes
includedelsewhereinthisprospectus.
(1) Giveseffecttothepaymentofapproximately$5.2millionintransactionexpensesincurredsinceDecember31,2016inconnectionwiththisoffering.
44
Table of Contents
Dilution
Ifyouinvestinoursubordinatevotingsharesinthisoffering,yourinterestwillbedilutedtotheextentofthedifferencebetweentheinitialpublicofferingpriceper
subordinatevotingshareinthisofferingandtheproformaasadjustednettangiblebookvaluepersubordinatevotingshareafterthisoffering.Dilutionresultsfrom
thefactthattheinitialpublicofferingpricepersubordinatevotingshareissubstantiallyinexcessofthenettangiblebookdeficitpershareattributabletothe
existingshareholdersforourpresentlyoutstandingshares.Ournettangiblebookdeficitpersharerepresentstheamountofourtotaltangibleassets(totalassetsless
intangibleassets)lesstotalliabilities,dividedbythenumberofsharesissuedandoutstanding.
AsofDecember31,2016,wehadahistoricalnettangiblebookdeficitof$105.2million,or$(1.05)pershare,basedon100,000,000proformamultiplevoting
sharesandsubordinatevotingsharesoutstandingasofsuchdate.Dilutioniscalculatedbysubtractingnettangiblebookdeficitpersharefromtheinitialpublic
offeringpriceof$17.00pershare.
Investorsparticipatinginthisofferingwillincurimmediateandsubstantialdilution.Withouttakingintoaccountanyotherchangesinsuchnettangiblebookdeficit
afterDecember31,2016,aftergivingeffecttothesaleofsubordinatevotingsharesinthisofferingattheinitialpublicofferingpriceof$17.00persubordinate
votingshare,lesstheunderwritingcommissionsandestimatedofferingexpensespayablebyus,ourproformanettangiblebookvaluedeficitasofDecember31,
2016wouldhavebeenapproximately$(20.0)million,or$(0.19)pershare.Thisamountrepresentsanimmediatedecreaseinnettangiblebookdeficitof$0.86per
sharetotheexistingshareholdersandimmediatedilutionof$17.19persharetoinvestorspurchasingoursubordinatevotingsharesinthisoffering.Thefollowing
tableillustratesthisdilutiononapersharebasis:
$ US$
Initialpublicofferingpricepersubordinatevotingshare(1) $17.00 $12.97
NettangiblebookdeficitpersubordinatevotingshareasofDecember31,2016,beforegivingeffecttothis
offering $ (1.05) $ (0.80)
Decreaseinnettangiblebookdeficitpersubordinatevotingshareattributabletoinvestorspurchasing
sharesinthisoffering
0.86
0.66
(1) TranslatedforconvenienceonlyusingthenoonbuyingrateforCanadiandollarsinNewYorkCity,ascertifiedforcustomspurposesbytheFederalReserve
BankofNewYork,onFebruary24,2017of$1.00=US$0.76.
45
Table of Contents
Thefollowingtablesummarizes,asofDecember31,2016,ontheproformabasisdescribedabove,theaggregatenumberofsharespurchasedfromus,thetotal
considerationpaidtous,andtheaveragepricepersharepaidbypurchasersofsuchsharesandbynewinvestorspurchasingsubordinatevotingsharesinthis
offering.
(1) Doesnotgiveeffecttothesaleof13,691,846subordinatevotingsharesbythesellingshareholdersinthisoffering.
Aftergivingeffecttothesaleof13,691,846subordinatevotingsharesbythesellingshareholdersinthisoffering,thepercentageofoursharesheldbyexisting
shareholderswouldbe81%andthepercentageofoursharesheldbynewinvestorswouldbe19%.Iftheunderwritersweretofullyexercisetheirover-allotment
optiontopurchaseadditionalsubordinatevotingsharesfromcertainofthesellingshareholders,thepercentageofoursharesheldbyexistingshareholderswouldbe
78%,andthepercentageofoursharesheldbynewinvestorswouldbe22%.
Thenumberofsharestobeoutstandingafterthisofferingisbasedonnosubordinatevotingsharesand100,000,000multiplevotingsharesoutstandingonapro
formabasisasofDecember31,2016andexcludes11,000,000subordinatevotingsharesreservedforfutureissuanceunderourequityincentiveplansasof
March1,2017,ofwhich5,899,660subordinatevotingshareswereissuableuponexerciseofstockoptionsataweightedaverageexercisepriceof$1.63pershare.
46
Table of Contents
Thefollowingtablessetforthourselectedhistoricalconsolidatedfinancialdata.Youshouldreadthefollowingselectedhistoricalconsolidatedfinancialdatain
conjunctionwithManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperationsandourconsolidatedfinancialstatementsandrelated
notesincludedelsewhereinthisprospectus.
WehavederivedtheselectedhistoricalconsolidatedinformationfortheyearsendedMarch31,2016andMarch31,2015andtheperiodsfromDecember9,2013
toMarch31,2014andApril1,2013toDecember8,2013andtheselectedconsolidatedfinancialpositioninformationasofMarch31,2015and2016fromour
auditedconsolidatedfinancialstatementsincludedelsewhereinthisprospectus.Wehavederivedtheselectedconsolidatedstatementofoperationsinformationfor
theninemonthsendedDecember31,2015and2016andtheselectedconsolidatedfinancialpositioninformationasofDecember31,2016fromourunaudited
interimconsolidatedfinancialstatementsincludedelsewhereinthisprospectus.OurconsolidatedfinancialstatementshavebeenpreparedinaccordancewithIFRS
andarepresentedinthousandsofCanadiandollarsexceptwhereotherwiseindicated.Ourhistoricalresultsarenotnecessarilyindicativeoftheresultsthatshould
beexpectedinanyfutureperiod.
OnDecember9,2013,BainCapitalacquiredamajorityequityinterestinourbusinessaspartoftheAcquisition.Accordingly,thefinancialstatementspresented
elsewhereinthisprospectusasofandforfiscal2014reflecttheperiodsbothpriorandsubsequenttotheAcquisition.Theconsolidatedfinancialstatementsfor
March31,2014arepresentedseparatelyforthepredecessorperiodfromApril1,2013throughDecember8,2013,whichwerefertoasthePredecessor2014
Period,andthesuccessorperiodfromDecember9,2013throughMarch31,2014,whichwerefertoastheSuccessor2014Period,withtheperiodspriortothe
AcquisitionbeinglabeledaspredecessorandtheperiodssubsequenttotheAcquisitionlabeledassuccessor.Forthepurposeofperformingacomparisontofiscal
2015,wehavepreparedUnauditedProFormaCombinedSupplementalFinancialInformationforfiscal2014,whichgiveseffecttotheAcquisitionasifithad
occurredonApril1,2013,andwhichwerefertoastheUnauditedProFormaCombined2014Period.SeeManagementsDiscussionandAnalysisofFinancial
ConditionandResultsofOperationsBasisofPresentation.
47
Table of Contents
Successor Predecessor
Period from
Nine months Nine months Fiscal Year Fiscal Year December 9, Period from
ended ended ended ended 2013 to April 1, 2013
CAD$000s December 31, December 31, March 31, March 31, March 31, to December 8,
(except per share data) 2016 2015 2016 2015 2014 2013
Statement of Operations Data:
Revenue 352,681 248,909 290,830 218,414 17,263 134,822
Costofsales
168,403
122,107
145,206
129,805
14,708
81,613
Netincome(loss) 45,071
35,687
26,485
14,425
(15,477)
15,278
Othercomprehensiveloss
(729)
(692)
Totalcomprehensiveincome(loss) 44,342
35,687
25,793
14,425
(15,477)
15,278
Earnings(loss)pershare
Basic 0.45 0.36 0.26 0.14 (0.15) 157,505.15
Diluted 0.44 0.35 0.26 0.14 (0.15) 157,505.15
Weightedaveragenumberofshares
outstanding
Basic 100,000,000 100,000,000 100,000,000 100,000,000 100,000,000 97
Diluted 101,751,470 101,622,219 101,680,207 101,211,134 100,000,000 97
Other Data:
EBITDA(2) $ 75,578 $ 55,009 $ 46,870 $ 30,063 $ (17,714) $ 23,609
AdjustedEBITDA(2) 92,443 61,913 54,307 37,191 (8,113) 23,984
AdjustedEBITDAMargin(3) 26.2% 24.9% 18.7% 17.0% (47.0)% 17.8%
AdjustedNetIncome(loss)(2) 58,851 38,520 30,122 21,374 (7,691) 15,554
GrossMargin 52.3% 50.9% 50.1% 40.6% 14.8% 39.5%
(1) Netinterestandotherfinancecostsconsistofinterestexpenserelatingtooursubordinateddebt,whichwasrefinancedinconnectionwiththeRecapitalization,aswellasourRevolving
Facilityandpriorcreditfacility.Interestexpenseassociatedwiththesubordinateddebtrepresented$3,822intheninemonthsendedDecember31,2016,$5,598infiscal2016,$5,398in
fiscal2015and$4,809intheUnauditedProFormaPeriodendedMarch31,2014.SeeManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperationsBasisof
PresentationforapresentationoftheUnauditedProFormaCombined2014Period.
(2) SeeManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperationsNon-IFRSMeasuresforareconciliationtothenearestIFRSmeasure.
(3) Seenote4inProspectusSummarySummaryHistoricalConsolidatedFinancialandOtherData.
48
Table of Contents
As of As of As of
December 31, March 31, March 31,
2016 2016 2015
Financial Position Information:
Cash 30,180 7,226 5,918
Totalassets 442,062 353,018 274,825
Totalliabilities 373,963 210,316 160,392
Shareholdersequity 68,099 142,702 114,433
49
Table of Contents
The following discussion and analysis of our financial condition and results of operations should be read together with our consolidated financial statements and
the related notes and the other financial information included elsewhere in this prospectus. This discussion contains forward-looking statements that involve risks
and uncertainties. Our actual results, performance and achievements could differ materially from those implied by these forward-looking statements as a result of
various factors, including those discussed below and elsewhere in this prospectus, particularly under Risk Factors. See Cautionary Note Regarding Forward-
Looking Statements.
Our consolidated financial statements have been prepared in accordance with IFRS. All amounts are in Canadian dollars except where otherwise indicated. See
Basis of Presentation. All references to fiscal 2014 refer to our Unaudited Pro Forma Combined Supplemental Financial Information for the year ended
March 31, 2014.
Overview
Founded60yearsagoinasmallTorontowarehouse,CanadaGoosehasgrownintoahighlycovetedglobalouterwearbrand.Wearerecognizedforauthentic
heritage,uncompromisedcraftsmanshipandquality,exceptionalwarmthandsuperiorfunctionality.Thisreputationisdecadesinthemakingandisrootedinour
commitmenttocreatingpremiumproductsthatdeliverunrivaledfunctionalitywhereandwhenitisneededmost.BeitCanadianArcticRangersservingtheir
countryoranexplorertrekkingtotheSouthPole,peoplewholive,workandplayintheharshestenvironmentsonEarthhaveturnedtoCanadaGoose.Throughout
ourhistory,wehavefoundinspirationinthesetechnicalchallengesandparlayedthatexpertiseintocreatingexceptionalproductsforanyoccasion.Fromresearch
facilitiesinAntarcticaandtheCanadianHighArctictothestreetsofToronto,NewYorkCity,London,Paris,Tokyoandbeyond,peoplehavefalleninlovewith
ourbrandandmadeitapartoftheireverydaylives.
Wearedeeplyinvolvedineverystageofourbusinessasadesigner,manufacturer,distributorandretailerofpremiumouterwearformen,womenandchildren.
Thisverticallyintegratedbusinessmodelallowsustodirectlycontrolthedesignanddevelopmentofourproductswhilecapturinghighermargins.AsofDecember
31,2016,ourproductsaresoldthroughselectoutdoor,luxuryandonlineretailersanddistributorsin36countries,oure-commercesitesinCanada,theUnited
States,theUnitedKingdomandFranceandtworecentlyopenedretailstoresinTorontoandNewYorkCity.
awareness,deepeningourwholesalepresenceandrollingoutourDTCchannelasmarketconditionspermit.Weexpectthatmarketingandselling
expensestosupporttheseinitiativeswillcontinuetogrowinproportiontoanticipatedrevenuegrowth.
50
Table of Contents
theycanoperateprofitably.Infiscal2018wearetargetingopeningbetween4and6e-commercestores,withalong-termtargetof15to20e-
commercestores.Inaddition,infiscal2018wearetargetingopening3retailstoresinnewgeographieswithalongtermtargetof15to20retail
stores.AswecontinuetoincreasethepercentageofsalesfromourDTCchannel,weexpecttomaintainabalancedmulti-channeldistributionmodel.
GrowthinourDTCchannelisalsoexpectedtoreducethecurrentseasonalconcentrationofourrevenuebyallowingustorecognizerevenuewhen
customersmakepurchasesinsteadofwhenproductsareshippedtoourretailpartners.Asaresult,weexpectarelativelyhigherpercentageofour
DTCsalestoberecognizedinourfiscalfourthquarter.Finally,asweexpandourDTCchannel,includingopeningadditionalretailstores,weexpect
ourcapitalexpenditurestocontinuetorepresent6.0to8.0%ofrevenue.
Seasonality. Weexperienceseasonalfluctuationsinourrevenueandoperatingresultsandwehistoricallyhaverealizedasignificantportionofour
revenueandearningsforthefiscalyearduringoursecondandthirdfiscalquarters.Wegenerated77.4%,78.1%and78.3%ofourrevenuesinthe
secondandthirdfiscalquartersoffiscal2016,fiscal2015andfiscal2014,respectively.Ourbusinessmodelalsoprovidesmeaningfulvisibilityinto
expectedfuturerevenues,withasignificantmajorityofwholesaleorderssecuredduringthethirdandfourthquartersofthepriorfiscalyear.In
addition,wetypicallyexperiencenetlossesinthefirstandfourthquartersasweinvestaheadofourmostactiveseason.Workingcapitalrequirements
typicallyincreasethroughoutourfirstandsecondfiscalquartersasinventorybuildstosupportourpeakshippingandsellingperiodwhichtypically
occursfromAugusttoNovember.Cashprovidedbyoperatingactivitiesistypicallyhighestinourthirdfiscalquarterduetothesignificantinflows
associatedwithourpeaksellingseason.
Segments
Wereportourresultsintwosegmentswhicharealignedwithoursaleschannels:WholesaleandDTC.Wemeasureeachreportableoperatingsegments
performancebasedonrevenueandsegmentoperatingincome.Throughourwholesalesegmentweselltoretailpartnersanddistributorsin36countries,asof
December31,2016.OurDTCsegmentiscomprisedofsalesthroughoure-commercesitesandretailstores.ThroughourDTCsegment,wesellonlineto
customersinCanada,theUnitedStates,theUnitedKingdomandFranceandinretailstoresasofthethirdquarteroffiscal2017tocustomersinTorontoandNew
YorkCity.
OurwholesalesegmentandDTCsegmentcontributed88.6%and11.4%ofourrevenue,respectively,infiscal2016.FortheninemonthsendedDecember31,
2016,thewholesalesegmentandDTCsegmentcontributed77.7%and22.3%,respectively.
51
Table of Contents
RevenueinourDTCchannelconsistsofsalesthroughoure-commerceoperationsand,beginninginthethirdquarteroffiscal2017,inourretailstores.Revenue
throughe-commerceoperationsandretailstoresarerecognizedupondeliveryofthegoodstothecustomerandwhencollectionisreasonablyassured,netofan
estimatedallowanceforsalesreturns.
Gross Profit
Grossprofitisourrevenuelesscostofsales.Costofsalesincludesthecostofmanufacturingourproducts,includingrawmaterials,directlabourandoverhead,
plusin-boundfreight,dutyandnon-refundabletaxesincurredindeliveringthegoodstodistributioncentresmanagedbythirdparties.Italsoincludesallcosts
incurredintheproduction,design,distributionandmerchandisedepartments,aswellasinventoryprovisionexpense.Theprimarydriversofourcostofsalesare
thecostsofrawmaterials,whicharesourcedbothinCanadiandollarsandU.S.dollars,labourinCanadaandtheallocationofoverhead.Grossmarginmeasures
ourgrossprofitasapercentageofrevenue.
Overthepasttwofiscalyears,ourgrossmarginhasimprovedasaresultofanincreaseinsalesattributabletoourDTCchannel,executiononourgeographic
expansionstrategy,anincreaseintheaverageeffectivepriceofourproductsandfavourableforeignexchangeimpacts.Weexpecttocontinuetoimprovegross
margininfutureperiodsasaresultofexpandingDTCsalesandstrategicallyincreasingthepricingofourproductsataratethatexceedstheexpectedincreasesin
productioncosts.
Sellingcostsgenerallycorrelatetorevenuetimingandthereforeexperiencesimilarseasonaltrends.Asapercentageofsales,weexpectthesesellingcoststo
increaseasourbusinessevolves.ThisincreaseisexpectedtobedrivenprimarilybythegrowthofourDTCchannel,includingtheinvestmentrequiredtosupport
additionale-commercesitesandretailstores.ThegrowthofourDTCchannelisexpectedtobeaccretivetonetincomegiventhehighergrossprofitmarginofour
DTCchannelwhichresultsfromtheopportunitytocapturethefullretailvalueofourproducts.
Generalandadministrativeexpensesrepresentcostsincurredinourcorporateoffices,primarilyrelatedtopersonnelcosts,includingsalaries,variableincentive
compensation,benefits,share-basedcompensationandotherprofessionalservicecosts.Wehaveinvestedconsiderablyinthisareatosupportthegrowingvolume
andcomplexityofourbusinessandanticipatecontinuingtodosointhefuture.Inaddition,inconnectionwiththisoffering,weexpecttoincurtransactioncosts
andstockcompensationexpensesand,followingthisoffering,weanticipateasignificantincreaseinaccounting,legalandprofessionalfeesassociatedwithbeinga
publiccompany.ForeignexchangegainsandlossesarerecordedinSG&Aandcomprisetranslationofassetsandliabilitiesdenominatedincurrenciesotherthan
thefunctionalcurrencyoftheentity,includingthetermloan,mark-to-marketadjustmentsonderivatives,foreignexchangeforwardcontracts,andrealizedgainson
settlementofassetsandliabilities.
52
Table of Contents
Income Taxes
Wearesubjecttoincometaxesinthejurisdictionsinwhichweoperateand,consequently,incometaxexpenseisafunctionoftheallocationoftaxableincomeby
jurisdictionandthevariousactivitiesthatimpactthetimingoftaxableevents.TheprimaryregionsthatdeterminetheeffectivetaxrateareCanada,theUnited
States,SwitzerlandandtheUnitedKingdom.Overthelong-term,wetargetourannualeffectiveincometaxratetobeapproximately25%.
Basis of Presentation
OnNovember21,2013,BainCapitalincorporatedCanadaGooseHoldingsInc.underthelawsofBritishColumbia.Pursuanttothepurchaseandsaleagreement
datedDecember9,2013,awholly-ownedsubsidiaryoftheSuccessoracquiredalltheoperatingassetsoftheformerCanadaGooseInc.andsalesanddistribution
companiesownedbytheformerCanadaGooseInc.whichconsistedofCanadaGooseEuropeAB,CanadaGooseUS,Inc.andCanadaGooseTradingInc.
TheAcquisitionwasaccountedforasabusinesscombinationusingtheacquisitionmethodofaccountingandtheSuccessorfinancialstatementsreflectanewbasis
ofaccountingthatisbasedonthefairvalueofassetsacquiredandliabilitiesassumedasoftheeffectivetimeoftheagreement.Periodspresentedpriorto
December9,2013representtheoperationsofthePredecessorandtheperiodpresentedasofDecember9,2013representstheoperationsoftheSuccessor.
ThefiscalyearendedMarch31,2014includesthe252dayPredecessor2014PeriodfromApril1,2013throughDecember8,2013andthe113daySuccessor2014
PeriodfromDecember9,2013throughMarch31,2014.Accordingly,thecompanysaccumulateddeficitasofMarch31,2014,andthecompanysretained
earningsasatMarch31,2015andMarch31,2016representonlytheresultsofoperationssubsequenttoandincludingDecember9,2013,thedateofthe
Acquisition.ThePredecessorandSuccessorperiodshavebeenseparatedbyablacklineontheconsolidatedfinancialstatementstohighlightthefactthatthe
financialinformationforsuchperiodshasbeenpreparedundertwodifferentcostbasesofaccounting.Allintercompanytransactionshavebeeneliminated.
ForthepurposeofperformingacomparisontothefiscalyearendedMarch31,2015,wehavepreparedUnauditedProFormaCombinedSupplementalFinancial
InformationfortheyearendedMarch31,2014,whichgiveseffecttotheAcquisitionasifithadoccurredonApril1,2013,andwhichwerefertoastheUnaudited
ProFormaCombined2014Period.TheUnauditedProFormaCombined2014PerioddiscussedhereinhasbeenpreparedinaccordancewithArticle11of
RegulationS-XpromulgatedundertheUnitedStatesSecuritiesActof1933,asamended,anddoesnotpurporttorepresentwhatouractualconsolidatedresultsof
operationswouldhavebeenhadtheAcquisitionactuallyoccurredonApril1,2013,norisitnecessarilyindicativeoffutureconsolidatedresultsofoperations.The
UnauditedProFormaCombined2014Periodisbeingdiscussedhereinforinformationalpurposesonlyanddoesnotreflectanyoperatingefficienciesorpotential
costsavingsthatmayresultfromtheconsolidationofoperations.
53
Table of Contents
TheproformaadjustmentsmadetogiveeffecttotheAcquisition,asifithadoccurredonApril1,2013,aresummarizedinthetablebelow:
Unaudited
Period from Period from pro forma
April 1, December 9, combined
2013 to 2013 to year ended
December 8, March 31, Pro Forma March 31,
CAD$000s 2013 2014 Adjustments 2014
Revenue 134,822 17,263 152,085
Costofsales 81,613 14,708 (2,906)(a) 93,415
Grossprofit 53,209 2,555 2,906 58,670
Selling,generalandadministrativeexpenses 30,119 20,494 (5,528)(b)(e) 45,085
Depreciationandamortization 447 804 1,151(c) 2,402
Operatingincome(loss) 22,643 (18,743) 7,283 11,183
Netinterestandotherfinancecosts 1,815 1,788 3,533(d)(f) 7,136
Income(loss)beforeincometaxes 20,828 (20,531) 3,750 4,047
Incometaxexpense(recovery) 5,550 (5,054) 528(g) 1,024
Netincome(loss) 15,278
(15,477)
3,222
3,023
Notestounauditedproformapresentation:
(a) Representsfairvaluestep-upofinventoryon-handatthetimeofAcquisition.TheamountsoldthroughintheperiodfromDecember9,2013through
March31,2014hasbeenremovedfromcostofsales.
(b) TheseamountsreflectthetransactioncostsincurredbythecompanyasaresultoftheAcquisition.Theseincludecoststhatweredirectlyattributabletothe
transaction,suchaslegal,duediligence,tax,audit,consulting,andotherprofessionalservices.Theseamountswouldnothavebeenincurredintheyearhad
thetransactionoccurredonApril1,2013andthereforehavebeenremovedfromSG&Aonaproformabasis.
(c) AtthetimeoftheAcquisition,acustomerlistintangibleassetintheamountof$8.7millionwasrecognizedwithausefullifeoffouryears.Hadthe
AcquisitionoccurredonApril1,2013,afullyearofamortizationwouldhavebeenrecorded.
(d) AsaresultoftheAcquisition,therevolvingdebtthatexistedinthePredecessorentitywasreplaced.HadtheAcquisitionoccurredonApril1,2013,this
interestwouldnothavebeenincurred.InconnectionwiththeAcquisition,thecompanyextinguishedtheexistinglong-termdebtandenteredacreditfacility
for$19.5million.Aproformaadjustmentforafullyearofinterestonthecreditfacilityhasbeenrecorded.
(e) BainmanagementfeeforthefullyearasifthetransactionwouldhaveoccurredonApril1,2013.
(f) Subordinateddebtintheamountof$79.7millionwasissuedonthedateofAcquisition.Thisadjustmentreflectstheinterestcostassociatedwiththe
subordinateddebthadthetransactionoccurredonApril1,2013.
(g) Incometaxexpensecalculatedattheannualeffectivetaxrateof25.3%ofproformaincomebeforetaxes.
54
Table of Contents
Results of Operations
Successor Predecessor
Period from Period from
Nine months Nine months Fiscal Year Fiscal Year December 9, April 1,
ended ended ended ended 2013 to 2013 to
December 31, December 31, March 31, March 31, March 31, December
CAD$000s 2016 2015 2016 2015 2014 8, 2013
Revenue $ 352,681 $ 248,909 290,830 218,414 17,263 134,822
Costofsales
168,403
122,107
145,206
129,805
14,708
81,613
Netincome(loss)
45,071
35,687
26,485
14,425
(15,477)
15,278
Othercomprehensiveloss
(729)
(692)
Comprehensiveincome(loss) 44,342
35,687
25,793
14,425
(15,477)
15,278
Three Months Ended December 31, 2016 Compared to Three Months Ended December 31, 2015
Revenue
RevenueforthethreemonthsendedDecember31,2016increasedby$93.5million,or81.0%,comparedtothethreemonthsendedDecember31,2015,whichwas
drivenbyanincreaseinrevenueinbothourwholesaleandDTCchannels.Onaconstantcurrencybasis,revenueincreasedby85.8%forthethreemonthsended
December31,2016comparedtothreemonthsendedDecember31,2015.
Revenueinourwholesalechannelwas$137.0million,anincreaseof$38.4million,comparedtothethreemonthsendedDecember31,2015.Theincreasein
revenueinourwholesalechannelwasdrivenprimarilybysalesofnewproductsfromourSpringandFallcollectionstoourretailpartners,stronggrowthoutside
NorthAmericaand,toalesserextent,bypriceincreasesofourproductsincertaingeographies.
RevenueinourDTCchannelwas$72.0million,anincreaseof$55.1million,comparedtothethreemonthsendedDecember31,2015,reflectingstrong
performancefromourCanadian,U.S.,FranceandU.K.e-commercesitessincelaunchinginAugustof2014,Septemberof2015andSeptemberof2016,
respectivelyandincrementalrevenuegeneratedfromretailstoresopenedinTorontoandNewYorkinthethirdquarteroffiscal2017.
55
Table of Contents
57.5%,comparedwith$63.9millionforthethreemonthsendedDecember31,2015,representingagrossmarginof55.3%.Theincreaseingrossprofitand220
basispointincreaseingrossmarginwasattributabletohigherrevenue,particularlyinourDTCchannel.
CostofsalesinourwholesalechannelforthethreemonthsendedDecember31,2016was$71.5million,anincreaseof$23.8million,comparedtothethree
monthsendedDecember31,2015.Grossprofitwas$65.5million,representingagrossmarginof47.8%,comparedwith$50.9millionforthethreemonthsended
December31,2015,representingagrossmarginof51.6%.Thedeclineingrossmarginof380basispointswasattributableprimarilytotheshiftofsalestolower
margingeographies,foreignexchangeheadwindsonproportionatelyhigherEuropeansalesand,toalesserextent,higherrawmaterialscostssourcedinU.S.
dollars.TheincreaseingrossprofitwasattributabletohighersalesandlowerproductcostsinCanadiandollars.
CostofsalesinourDTCchannelforthethreemonthsendedDecember31,2016was$17.2million,anincreaseof$13.4million,comparedtothethreemonths
endedDecember31,2015.Grossprofitwas$54.8million,representingagrossmarginof76.1%,comparedwith$13.0millionofgrossprofitforthethreemonths
endedDecember31,2015,representingagrossmarginof77.2%.Theincreaseingrossprofitwasattributabletohigherrevenueasaresultofincrementalretail
storerevenuegeneratedduringthethreemonthperiod,growthine-commercebusinessandlowerproductcostsinCanadiandollars,partiallyoffsetbyhigherraw
materialscostsinU.S.dollars.
SG&AexpensesinourwholesalechannelforthethreemonthsendedDecember31,2016was$10.5million,adecreaseof$0.3million,comparedtothethree
monthsendedDecember31,2015,whichrepresents7.7%ofsegmentrevenueforthethreemonthsendedDecember31,2016comparedto11.0%ofsegment
revenueforthethreemonthsendedDecember31,2015.Thedecreaseincostswasattributabletoexpensesincurredinthecomparableprioryearperiod
restructuringourinternationaloperationstoZug,SwitzerlandwhichencompassedclosingseveralofficesacrossEurope,relocatingpersonnelandincurring
temporaryofficecostsandterminationofthirdpartysalesagents.Theseaforementionedpriorperiodcostsmorethanoffsetanincreaseinheadcountand
operationalandsellingexpenditurestosupportnewmarketinginitiativesandentryintonewmarkets.
SG&AexpensesinourDTCchannelforthethreemonthsendedDecember31,2016was$13.1million,anincreaseof$7.9million,comparedtothethreemonths
endedDecember31,2015,whichrepresents18.2%ofsegmentrevenueforthethreemonthsendedDecember31,2016comparedto30.6%ofsegmentrevenuefor
thethreemonthsendedDecember31,2015.Theincreaseinsegmentcostswasattributabletoestablishingournewe-commercesitesinFranceandtheUnited
Kingdom,maintainingourexistinge-commercesitesandopeningourtworetailstoresintheUnitedStatesandCanada.
56
Table of Contents
Income Taxes
IncometaxexpenseforthethreemonthsendedDecember31,2016was$14.1millioncomparedto$7.2millionforthethreemonthsendedDecember31,2015.
ForthethreemonthsendedDecember31,2016,theeffectivetaxratewas26.6%andvariedfromthestatutorytaxrateof25.3%.Forthethreemonthsended
December31,2015,theeffectivetaxratewas25.2%andvariedimmateriallyfromthestatutorytaxrateof25.3%.
Net Income
NetincomeforthethreemonthsendedDecember31,2016was$39.1millioncomparedwith$21.4millionforthethreemonthsendedDecember31,2015.The
increaseof$17.6million,or82.3%,wasdrivenbythefactorsdescribedabove.
Nine Months Ended December 31, 2016 Compared to Nine Months Ended December 31, 2015
Revenue
RevenuefortheninemonthsendedDecember31,2016increasedby$103.8million,or41.7%,comparedtotheninemonthsendedDecember31,2015,whichwas
drivenbyanincreaseinrevenueinbothourwholesaleandDTCchannels.Onaconstantcurrencybasis,revenueincreasedby43.9%fortheninemonthsended
December31,2016comparedtotheninemonthsendedDecember31,2015.
Revenueinourwholesalechannelwas$273.9million,anincreaseof$44.8million,comparedtotheninemonthsendedDecember31,2015.Theincreasein
revenueinourwholesalechannelwasdrivenprimarilybysalesofnewproductsfromourSpringandFallcollectionstoourretailpartners,stronggrowthoutsideof
NorthAmericaand,toalesserextent,bypriceincreasesofourproductsincertaingeographies.
RevenueinourDTCchannelwas$78.8million,anincreaseof$59.0million,comparedtotheninemonthsendedDecember31,2015,reflectingstrong
performancefromtheCanadian,U.K.,andFrancee-commercesitessincelaunchinginAugustof2014,andSeptemberof2016,respectively,afullninemonthsof
activityonourU.S.e-commercesitewhichlaunchedinSeptemberof2015andincrementalrevenuegeneratedfromretailstoresopenedinTorontoandNewYork
inthethirdquarteroffiscal2017.
CostofsalesinourwholesalechannelfortheninemonthsendedDecember31,2016was$149.0million,anincreaseof$31.6million,comparedtothenine
monthsendedDecember31,2015.Segmentgrossprofitwas$124.9million,representingasegmentgrossmarginof45.6%,comparedwith$111.8millionforthe
ninemonthsendedDecember31,2015,representingasegmentgrossmarginof48.8%.Thedeclineinsegmentgrossmarginof320basispointswasattributable
primarilytoforeignexchangeimpactresultingfromgeographicalsalesmix,ahigherproportionofsalesinlowermargingeographies,thetimingofinventory
provisionstakeninfirstquarteroffiscal2017and,toalesserextent,higherrawmaterialscostsfromproductssourcedinU.S.dollars.Combined,theseincreases
morethanoffsetlowerCanadiandollardenominatedproductioncosts.
CostofsalesinourDTCchannelfortheninemonthsendedDecember31,2016was$19.4million,anincreaseof$14.7million,comparedtotheninemonths
endedDecember31,2015.Segmentgrossprofitwas
57
Table of Contents
$59.3million,representingasegmentgrossmarginof75.3%,comparedwith$15.0millionfortheninemonthsendedDecember31,2015,representingasegment
grossmarginof76.2%.Theincreaseinsegmentgrossprofitwasattributabletohighersegmentrevenuedrivenbyincrementalretailstorerevenue,afullnine
monthperiodofe-commercestoresintheUnitedStates,thelaunchofe-commercewebsitesinFranceandtheU.K.inSeptember2016,lowerproductcostsin
Canadiandollars,partiallyoffsetbyhigherrawmaterialscostssourcedinU.S.dollars.
SG&AexpensesinourwholesalechannelfortheninemonthsendedDecember31,2016was$24.0million,anincreaseof$1.7million,comparedtothenine
monthsendedDecember31,2015,whichrepresents8.8%ofsegmentrevenuefortheninemonthsendedDecember31,2016comparedto9.7%ofsegment
revenuefortheninemonthsendedDecember31,2015.Theincreaseinsegmentcostswasattributabletoanincreaseinheadcount,sellingandoperational
expenditurestosupportgrowthinitiativesandentryintonewmarkets.Theincreasewaspartiallyoffsetby$5.9millionofexpensesincurredinthecomparable
prioryearperiod;comprisingof$2.9millionforrestructuringourinternationaloperationstoZug,Switzerlandwhichencompassedclosingseveralofficesacross
Europe,relocatingpersonnelandincurringtemporaryofficecostsaswellas$3.0millionincurredforterminationofthirdpartysalesagents.
SG&AexpensesinourDTCchannelfortheninemonthsendedDecember31,2016was$17.8million,anincreaseof$10.8millioncomparedtotheninemonths
endedDecember31,2015,whichrepresents22.6%ofsegmentrevenuefortheninemonthsendedDecember31,2016comparedto35.6%ofsegmentrevenuefor
theninemonthsendedDecember31,2015.TheincreaseinsegmentcostswasattributabletoestablishingournewsitesinFranceandtheU.K.,maintainingour
existinge-commercesitesandopeningourtworetailstoresintheUnitedStatesandCanada.
Income Taxes
IncometaxexpensefortheninemonthsendedDecember31,2016was$15.4millioncomparedto$8.7millionfortheninemonthsendedDecember31,2015.For
theninemonthsendedDecember31,2016,theeffectivetaxratewas25.5%andvariedmarginallyfromthestatutorytaxrateof25.3%.Fortheninemonthsended
December31,2015,theeffectivetaxratewas19.5%versusthestatutorytaxrateof25.3%.
ThedifferencebetweentheeffectivetaxrateandthestatutorytaxratefortheninemonthsendedDecember31,2015relatesprimarilytothebenefitofaone-time
reversalofadeferredtaxliabilityof$3.5millionrelatingtointercompanytransactionsduringtheninemonthsendedDecember31,2015.
58
Table of Contents
Net Income
NetincomefortheninemonthsendedDecember31,2016was$45.1millioncomparedwith$35.7millionfortheninemonthsendedDecember31,2015.The
increaseof$9.4million,or26.3%,wasprimarilytheresultofthefactorsdescribedabove.
Fiscal Year Ended March 31, 2016 Compared to Fiscal Year Ended March 31, 2015
Revenue
Revenueforfiscal2016increasedby$72.4million,or33.2%,comparedtofiscal2015,drivenbyanincreaseinrevenueinourwholesalechannelandbygrowthin
ourDTCchannel.Onaconstantcurrencybasis,revenueincreased25.2%forfiscal2016comparedtofiscal2015.
Revenueinourwholesalechannelincreased$47.4million,or22.5%,comparedtofiscal2015.Theincreaseinrevenueinourwholesalechannelwasprimarily
drivenbyadditionalproductsales,salesofnewproductsfromourSpringandFallcollectionstoourretailpartnersand,toalesserextent,bypriceincreasesonour
productsincertaingeographies.
ThisincreaseinrevenuewasalsodueinparttotheinclusionofafullyearofperformancefromourCanadiane-commercesiteandthelaunchofourU.S.e-
commercesiteinourDTCsegment,representinga$25.0millionincreaseoverfiscal2015.
Costofsalesinourwholesalechannelforfiscal2016increasedby$8.7million,or6.8%,comparedtofiscal2015,whilesegmentgrossprofitwas$121.4million,
representingasegmentgrossmarginof47.1%,comparedwith$82.7millioninfiscal2015,representingasegmentgrossmarginof39.3%.Theincreaseinsegment
grossprofitwasattributabletotheoverallhigherrevenueinfiscal2016.Additionally,segmentgrossprofitwaspositivelyimpactedbylowerproductioncosts,
partiallyoffsetbyanincreaseinrawmaterialscostssourcedinU.S.dollars.
CostofsalesinourDTCchannelforfiscal2016increasedby$6.7million,or313.6%,comparedtofiscal2015,whilesegmentgrossprofitwas$24.2million,
representingasegmentgrossmarginof73.3%,comparedwith$5.9millioninfiscal2015,representingasegmentgrossmarginof73.4%.Theincreaseinsegment
grossprofitwasattributabletothegrowthine-commercerevenueinourDTCchannel,includingtheimpactofhavingtheU.S.e-commercestoreopenbeginning
inSeptemberof2015,aswellasoverallhigherrevenueinfiscal2016.
59
Table of Contents
ourwholesalesegmentassociatedwithterminatingthirdpartysalesagentswhichresultedinindemnitiesandotherterminationpayments.Alsoincludedwas$6.9
millionofexpensesrelatingtorestructuringourinternationaloperationstoZug,Switzerland,includingclosingseveralofficesacrossEurope,relocatingpersonnel
andincurringtemporaryofficecosts.
SG&Aexpensesinourwholesalechannelforfiscal2016decreasedby$10.1millionoverfiscal2015,or27.2%,representing10.5%ofsegmentrevenueinfiscal
2016comparedto17.7%ofsegmentrevenueinfiscal2015.Thedecreasewasattributabletotheincreaseincentralizedmarketinginitiativesdescribedabove,
offsetbyindemnitiesandterminationpaymentsforthirdpartysalesagents.
SG&AexpensesinourDTCchannelforfiscal2016increasedby$12.7millionoverfiscal2015,or920.4%,representing42.8%ofsegmentrevenueinfiscal2016
comparedto17.3%ofsegmentrevenueinfiscal2015.TheincreaseinexpenseswasattributabletoanincreaseinheadcountandbrandinvestmentinourDTC
channelassociatedwithestablishingoure-commercesitesandopeningourretailstores.
Income Taxes
Incometaxexpenseincreasedby$1.8millionduringfiscalyear2016whilethenetincomebeforetaxesincreasedascomparedtofiscal2015.Thisisprimarilyasa
resultofadecreaseintheeffectivetaxratefrom24.6%forfiscalyear2015to19.6%forfiscalyear2016,togetherwiththebenefitofaone-timereversalofa
deferredtaxliabilityof$3.5millionrelatingtointercompanytransactionsduringthethreemonthsendedSeptember30,2015.
Net Income
Netincomeforfiscal2016was$26.5millioncomparedwith$14.4millioninfiscal2015.Theincreaseof$12.1million,or83.6%,wastheresultofthefactors
describedabove.
Comparison of the fiscal year ended March 31, 2015 to the Predecessor 2014 Period and the Successor 2014 Period, as well as a comparison of the fiscal year
ended March 31, 2015 to the Unaudited Pro Forma Combined Period for the fiscal year ended March 31, 2014
TheAcquisitionwasaccountedforasabusinesscombinationinaccordancewithIFRS3Business Combinations andtheresultingnewbasisofaccountingis
reflectedintheCompanysconsolidatedfinancialstatementsforallperiodsbeginningonorafterDecember9,2013.Asaresultandinordertoprovideamore
meaningfulcomparison,wearealsosupplementallypresentingacomparisonoffiscal2015withtheUnauditedProFormaCombinedPeriodforthefiscalyear
endedMarch31,2014.ExceptforthespecificproformaadjustmentsmadetoarriveattheUnauditedProFormaCombined2014Period,theunderlyingdriversfor
thechangeinfiscal2015ascomparedtofiscal2014,bothactual2014resultsandtheUnauditedProFormaCombined2014Periodresults,arethesame.
Revenue
Revenuewas$218.4millionforfiscal2015,ascomparedto$134.8millionforthePredecessor2014Periodand$17.3millionfortheSuccessor2014Period,or
$152.1millionfortheUnauditedProFormaCombined2014Period.Thisrepresentsa43.6%increaseinfiscal2015,ascomparedtotheUnauditedProForma
Combined2014Period.Theincreaseinrevenuewasdrivenprimarilybyanincreaseinproductsalestoourretailpartnersandtoalesserextentbypriceincreases
onourproductsincertaingeographies.Onaconstantcurrencybasis,revenueincreasedby39.0%forfiscal2015comparedtotheUnauditedProFormaCombined
2014Period.
60
Table of Contents
Income Taxes
Incometaxexpensewas$4.7millionforfiscal2015,ascomparedto$5.6millionforthePredecessor2014Period,representinganeffectivetaxrateof26.6%and
wasarecoveryof$5.1millionforSuccessor2014Period,representinganeffectivetaxrateof24.6%,and$1.0millionfortheUnauditedProFormaCombined
2014Period,representinganeffectivetaxrateof25.3%.Incometaxexpenseincreasedby$3.7millioninfiscal2015comparedtotheUnauditedProForma
Combined2014Periodasaresultofhighertaxableincomefromimprovedoperatingperformanceinfiscal2015andhighernon-deductibleexpensesinthe
comparableperiod.
Net Income
Netincomewas$14.4millionforfiscal2015,ascomparedto$15.3millionforthePredecessor2014Period,andalossof$15.5millionforSuccessor2014Period,
or$3.0millionfortheUnauditedProFormaCombined2014Period.Netincomeinfiscal2015representsa377.2%increaseascomparedtotheUnauditedPro
FormaCombined2014Period.Theincreaseinnetincomeinfiscal2015wasdrivenprimarilybytheunderlyingperformanceofthebusiness,andtheimpactof
transactioncostsaswellasbytheimpactof$2.6millionofamortizationexpenseinfiscal2015relatingtoastep-upofintangibleassets,bothrelatingtothe
AcquisitiononDecember9,2013.
61
Table of Contents
CAD$000s (except per share data) Q3 2017 Q2 2017 Q1 2017 Q4 2016 Q3 2016 Q2 2016 Q1 2016 Q4 2015
Revenue 209,051 127,935 15,695 41,921 115,504 109,694 23,711 18,778
Net Income (Loss) 39,088 20,019 (14,036) (9,202) 21,446 18,475 (4,234) (7,390)
Basic Earnings (Loss) per Share 0.39 0.20 (0.14) (0.09) 0.21 0.18 (0.04) (0.08)
Diluted Earnings (Loss) per Share 0.38 0.20 (0.14) (0.09) 0.21 0.18 (0.04) (0.08)
Revenue
Overthelasteightquarters,revenuehasbeenimpactedbythefollowing:
rolloutofe-commerceinCanadainthesecondquarteroffiscal2015,UnitedStatesinthesecondquarteroffiscal2016andintheUnitedKingdom
andFranceinthethirdquarteroffiscal2017;
openingofretailstoresinTorontoandNewYorkCityinthethirdquarteroffiscal2017;
successfulexecutionofpricingstrategyacrossallsegments;
shiftinmixofrevenuefromwholesaletoDTC;
shiftingeographicmixofsalestoincreasesalesoutsideofCanada;
fluctuationofforeignexchangeratesbetweentheUSD,GBPandEuroversusCAD;and
timingofshipmentstowholesalecustomers.
impactoftheitemsnotedinrevenueabove;
increaseandtimingofourinvestmentinbrand,marketing,andadministrativesupporttosupportourwholesaleexpansionandDTCchannelaswellas
increasedinvestmentinproperty,plant,andequipmentandintangibleassetstosupportgrowthinitiatives;
impactofforeignexchangeonproductioncosts;
higheraverageborrowingstoaddressthegrowingmagnitudeofinventoryneedsandhigherseasonalborrowingsinthefirstandfourthquartersofeach
fiscalyeartoaddressseasonalnatureofrevenue.
transactioncostsinrelationtothisoffering;and
consolidationofourinternationaloperationstoZug,SwitzerlandwhichincludedclosingofficesacrossEuropeandterminatingthirdpartysales
agents.
Non-IFRS Measures
InadditiontoourresultsdeterminedinaccordancewithIFRS,webelievethefollowingnon-IFRSmeasuresprovideusefulinformationbothtomanagementand
investorsinmeasuringthefinancialperformanceand
62
Table of Contents
financialconditionoftheCompanyforthereasonsoutlinedbelow.ThesemeasuresdonothaveastandardizedmeaningprescribedbyIFRSandthereforetheymay
notbecomparabletosimilarlytitledmeasurespresentedbyotherpubliclytradedcompanies,andtheyshouldnotbeconstruedasanalternativetootherfinancial
measuresdeterminedinaccordancewithIFRS.
Unaudited
Period from Period from Pro Forma
Nine months Nine months Year Year April 1, December 9, period
ended ended ended ended 2013 to 2013 to ended
December 31, December 31, March 31, March 31, December 8, March 31, March 31,
CAD$000s 2016 2015 2016 2015 2013 2014 2014
EBITDA 75,578 55,009 46,870 30,063 23,609 (17,714) 14,329
AdjustedEBITDA 92,443 61,913 54,307 37,191 23,984 (8,113) 15,870
AdjustedEBITDAMargin 26.2% 24.9% 18.7% 17.0% 17.8% (47.0)% 10.4%
AdjustedNetIncome 58,851 38,520 30,122 21,374 15,554 (7,691) 5,799
ConstantCurrencyRevenue 358,147 233,325 273,410 211,361
Managementusesthesenon-IFRSfinancialmeasures(otherthanConstantCurrencyRevenue)toexcludetheimpactofcertainexpensesandincomethat
managementdoesnotbelievearereflectiveofthecompanysunderlyingoperatingperformanceandmakecomparisonsofunderlyingfinancialperformance
betweenperiodsdifficult.Fromtimetotime,thecompanymayexcludeadditionalitemsifitbelievesdoingsowouldresultinamoreeffectiveanalysisof
underlyingoperatingperformance.
EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Net Income arefinancialmeasuresthatarenotdefinedunderIFRS.Weusethesenon-
IFRSfinancialmeasures,andbelievetheyenhanceaninvestorsunderstandingofourfinancialandoperatingperformancefromperiodtoperiod,becausethey
excludecertainmaterialnon-cashitemsandcertainotheradjustmentswebelievearenotreflectiveofourongoingoperationsandourperformance.Inparticular,
followingtheAcquisition,wehavemadechangestoourlegalandoperatingstructuretobetterpositionourorganizationtoachieveourstrategicgrowthobjectives
whichhaveresultedinoutflowsofeconomicresources.Accordingly,weusethesemetricstomeasureourcorefinancialandoperatingperformanceforbusiness
planningpurposesandasacomponentinthedeterminationofincentivecompensationforsalariedemployees.Inaddition,webelieveEBITDA,Adjusted
EBITDA,AdjustedEBITDAMarginandAdjustedNetIncomearemeasurescommonlyusedbyinvestorstoevaluatecompaniesintheapparelindustry.However,
theyarenotpresentationsmadeinaccordancewithIFRSandtheuseofthetermsEBITDA,AdjustedEBITDA,AdjustedEBITDAMarginandAdjustedNet
Incomevaryfromothersinourindustry.Thesefinancialmeasuresarenotintendedtorepresentandshouldnotbeconsideredasalternativestonetincome,
operatingincomeoranyotherperformancemeasuresderivedinaccordancewithIFRSasmeasuresofoperatingperformanceoroperatingcashflowsoras
measuresofliquidity.
EBITDA,AdjustedEBITDA,AdjustedEBITDAMarginandAdjustedNetIncomehaveimportantlimitationsasanalyticaltoolsandyoushouldnotconsiderthem
inisolationorassubstitutesforanalysisofourresultsasreportedunderIFRS.Forexample,thesefinancialmeasures:
excludecertaintaxpaymentsthatmayreducecashavailabletous;
donotreflectanycashcapitalexpenditurerequirementsfortheassetsbeingdepreciatedandamortizedthatmayhavetobereplacedinthefuture;
donotreflectchangesin,orcashrequirementsfor,ourworkingcapitalneeds;
donotreflecttheinterestexpense,orthecashrequirementsnecessarytoserviceinterestorprincipalpayments,onourdebt;and
63
Table of Contents
othercompaniesinourindustrymaycalculatethesemeasuresdifferentlythanwedo,limitingtheirusefulnessascomparativemeasures.
ThetablesbelowillustrateareconciliationofnetincometoEBITDA,AdjustedEBITDAandAdjustedNetIncomefortheperiodspresented:
64
Table of Contents
(a) RepresentstheamountpaidpursuanttothemanagementagreementwithBainCapitalforongoingconsultingandotherservices.Inconnectionwiththis
offering,themanagementagreementwillbeterminated,andBainCapitalwillnolongerreceivemanagementfeesfromus.SeeCertainRelationshipsand
RelatedPartyTransactionsManagementAgreement.
(b) InconnectionwiththeAcquisitionandthefilingofthisprospectus,thecompanyincurredexpensesrelatedtoprofessionalfees,consulting,legal,and
accountingthatwouldotherwisenothavebeenincurredandweredirectlyrelatedtothesetwomatters.Thesefeesarenotindicativeofthecompanys
ongoingcostsandweexpecttheywilldiscontinuefollowingthecompletionofthisoffering.
(c) InconnectionwiththeAcquisition,werecognizedacquiredinventoryatfairvalue,whichincludedamark-upforprofit.Recordinginventoryatfairvaluein
purchaseaccountinghadtheeffectofincreasinginventoryandtherebyincreasingthecostofsalesinsubsequentperiodsascomparedtotheamountswe
wouldhaverecognizediftheinventorywassoldthroughatcost.Thewrite-upofacquiredinventorysoldrepresentstheincrementalcostofsalesthatwas
recognizedasaresultofpurchaseaccounting.Thisinventorywassoldinfiscal2014andfiscal2015andhasimpactednetincomeinbothperiods.
(d) Representsunrealizedgainsonforeignexchangeforwardcontractsrecordedinfiscal2016thatrelatetofiscal2017.Wemanageourexposuretoforeign
currencyriskbyenteringintoforeignexchangeforwardcontracts.Managementforecastsitsnetcashflowsinforeigncurrencyusingexpectedrevenuefrom
ordersitreceivesforfutureperiods.Theunrealizedgainsandlossesonthesecontractsarerecognizedinnetincomefromthedateofinceptionofthe
contract,whilethecashflowstowhichthederivativesrelatedarenotrealizeduntilthecontractsettles.Managementbelievesthatreflectingthese
adjustmentsintheperiodinwhichthenetcashflowswilloccurismoreappropriate.
(e) Representsnon-cashchargeforunrealizedlossesonthetranslationoftheTermLoanFacilityfromUSDtoCAD$.
(f) RepresentsexpensesincurredtoestablishourEuropeanheadquartersinZug,Switzerland,includingclosingseveralsmallerofficesacrossEurope,relocating
personnel,andincurringtemporaryofficecosts.
(g) Representsnon-cashshare-basedcompensationexpense.Adjustmentsinfiscal2017reflectmanagementsestimatethatcertaintranchesofoutstanding
optionawardswillvest.
(h) Representsaccruedexpensesrelatedtoterminationpaymentstobemadetoourthirdpartysalesagents.Aspartofastrategytotransitioncertainsales
functionsin-house,weterminatedthemajorityofourthirdpartysalesagentsandcertaindistributors,primarilyduringfiscal2015and2016,whichresulted
inindemnitiesandotherterminationpayments.Assalesagentshavenowlargelybeeneliminatedfromthesalesstructure,managementdoesnotexpectthese
chargestorecurinfuturefiscalperiods.
(i) Representsnon-cashamortizationchargesduringpre-openingperiodsfornewstoreleases.
(j) AsaresultoftheAcquisition,thecompanyrecognizedanintangibleassetforcustomerlistsintheamountof$8.7million,whichhasausefullifeoffour
years.
(k) Duringfiscal2016,weenteredintoaseriesoftransactionswherebyourwholly-ownedsubsidiary,CanadaGooseInternationalAG,acquiredtheglobal
distributionrightstoourproducts.Asaresult,therewasaone-timetaxbenefitof$3.5millionrecordedduringtheyear.
(l) SeeBasisofPresentationforapresentationofourUnauditedProFormaCombinedSupplementalFinancialInformationfortheyearendedMarch31,
2014.
65
Table of Contents
* UnauditedproformacombinedyearendedMarch31,2014.
Successor Predecessor
Period from Period from
Nine months Nine months Year Year December 9, April 1,
ended ended ended ended 2013 to 2013 to
December 31, December 31, March 31, March 31, March 31, December 8,
CAD$000s 2016 2015 2016 2015 2014 2013
Totalcashprovidedby(usedin):
Operatingactivities 36,704 (9,946) (6,442) 4,960 (11,593) 15,202
Investingactivities (21,762) (20,017) (21,842) (7,263) (149,431) (6,361)
Financingactivities 8,012 47,638 29,592 4,951 164,294 (5,715)
Increase(decrease)incash 22,954 17,675 1,308 2,648 3,270 3,126
Cash,endofperiod 30,180 23,593 7,226 5,918 3,270 4,477
Ourprimaryneedforliquidityistofundworkingcapitalrequirementsofourbusiness,capitalexpenditures,debtserviceandforgeneralcorporatepurposes.Our
primarysourceofliquidityisfundsgeneratedbyoperatingactivities.WealsouseourassetbasedRevolvingFacilityasasourceofliquidityforshort-termworking
capitalneedsandgeneralcorporatepurposes.Ourabilitytofundouroperations,tomakeplannedcapitalexpenditures,
66
Table of Contents
tomakescheduleddebtpaymentsandtorepayorrefinanceindebtednessdependsonourfutureoperatingperformanceandcashflows,whicharesubjectto
prevailingeconomicconditionsandfinancial,businessandotherfactors,someofwhicharebeyondourcontrol.Cashgeneratedfromoperationsaresignificantly
impactedbytheseasonalityofourbusiness,withadisproportionateamountofouroperatingcashgenerallycominginthesecondandthirdfiscalquartersofeach
year.Asaresult,historically,wehavehadhigherbalancesunderourrevolvingcreditfacilitiesinthefirstandfourthquartersandlowerbalancesinthesecondand
thirdquarters.
AsofDecember31,2016,wehad$30.2millionofcashand$144.5millionofworkingcapital,whichiscurrentassetsminuscurrentliabilities,comparedwith
$7.2millionofcashand$104.8millionofworkingcapitalasofMarch31,2016.The$39.7millionincreaseinourworkingcapitalwasprimarilyduetoa$23.0
millionincreaseincash,a$71.5millionincreaseinaccountsreceivable,primarilyoffsetbya$22.8milliondecreaseininventory,a$25.8millionincreasein
accountspayableandaccruedliabilitiesanda$9.3millionincreaseinprovisions.Workingcapitalissignificantlyimpactedbytheseasonaltrendsofourbusiness
andhasbeenfurtherimpactedinthecurrentquartersbytheopeningofourretailstores.
Weexpectthatourcashonhandandcashflowsfromoperations,alongwithourRevolvingFacility,willbeadequatetomeetourcapitalrequirementsand
operationalneedsforthenext12months.
Cash Flows
Cash flows from operating activities
Cashflowsgeneratedinoperatingactivitiesincreasedfrom$9.9millionusedintheninemonthsendedDecember31,2015to$36.7milliongeneratedfromthe
ninemonthsendedDecember31,2016.Thisperiod-over-periodincreaseincashgeneratedfromoperatingactivitiesof$46.7millionwasprimarilyduetoan
increaseinnetincomeof$9.4millionanda$38.0millionloweruseofcashinworkingcapitalitems,includingdifferencesintimingofpaymentsonaccounts
payableandaccruedliabilitiesinthecomparableperiodsandseasonaldecreaseininventorypartiallyoffsetbylowerpaymentsofprovisionsandothercurrent
assetsinthecurrentperiodandhigherincometaxinstallmentsof$13.7millionduetohighertaxableincome.
Cashusedinoperatingactivitieswas$6.4millioninfiscal2016comparedtocashflowsprovidedbyoperatingactivitiesof$5.0millioninfiscal2015.Theyear-
over-yeardecreaseof$11.4millionincashinflowswasprimarilyduetoanincreaseininventoryof$49.7millionasaresultofpreparationforthelaunchofoure-
commercestoreintheUnitedStates,partiallyoffsetbyanincreaseinnetincomeof$12.1million,aswellasincreasesinaccountspayableandaccruedliabilities.
Cashprovidedbyoperatingactivitieswas$5.0millioninfiscal2015comparedtocashflowsusedinoperatingactivitiesof$11.6millionduringtheperiodfrom
December9,2013toMarch31,2014andcashprovidedbyoperatingactivitiesof$15.2millionduringtheperiodfromApril1,2013toDecember8,2013.The
period-over-periodincreaseincashinflowswasprimarilyduetoanincreaseinnetincome,partiallyoffsetbyincreasesinaccountsreceivableof$9.2millionand
increasesininventoryof$10.6millionduetohighersalesvolumes.
Theyear-over-yearincreaseincashoutflowsof$14.6millioninfiscal2016comparedtofiscal2015wasprimarilyduetoincreasedinvestmentsinpropertyand
equipmenttoincreaseproductioncapacityandinretailstoreande-commerceassets,aswellasinvestmentsinintangibleassetsrelatedtoERPsoftware.
67
Table of Contents
Theyear-over-yeardecreaseincashoutflowsof$142.2millioninfiscal2015comparedtotheUnauditedProFormaCombined2014Periodwasprimarilydueto
outflowsrelatedtotheAcquisition.
The$24.6millionincreaseinfiscal2016comparedtofiscal2015wasprimarilydrivenbyanincreaseinborrowingsunderourcreditfacilityusedtofinance
workingcapital.
Theyear-over-yeardecreaseincashinflowsof$159.3millioninfiscal2015comparedtotheperiodfromDecember9,2013toMarch31,2014wasprimarilydue
totheproceedsfromBainCapitalsinitialinvestmentinthecompanyinexchangeforsubordinateddebtandClassASeniorPreferredSharesforthepurposeofthe
Acquisition.
Indebtedness
Revolving Facility
OnJune3,2016,CanadaGooseHoldingsInc.anditswholly-ownedsubsidiaries,CanadaGooseInc.andCanadaGooseInternationalAG,enteredintoasenior
securedasset-basedrevolvingcreditfacility,whichwerefertoastheRevolvingFacility,withCanadianImperialBankofCommerce,asadministrativeagent,and
certainfinancialinstitutionsaslenders,whichmaturesin2021.TheRevolvingFacilityhascommitmentsof$150.0millionwithaseasonalincreaseofupto
$200.0millionduringpeakseason(June1throughNovember30).Inaddition,theRevolvingFacilityincludesaletterofcreditsub-facilityof$25.0million.All
obligationsundertheRevolvingFacilityareunconditionallyguaranteedbyCanadaGooseHoldingsInc.and,subjecttocertainexceptions,ourU.S.,Swiss,U.K.
andCanadiansubsidiaries.TheRevolvingFacilityprovidesforcustomaryeventsofdefault.
LoansundertheRevolvingFacility,atouroptionmaybemaintainedfromtimetotimeas(a)PrimeRateLoans,whichbearinterestatarateperannumequalto
theApplicableMarginforPrimeRateLoansplusthePrimeRate,(b)BankersAcceptancesfundedonadiscountedproceedsbasisgiventhepublisheddiscount
rateplusarateperannumequaltotheApplicableMarginforstampingfees,(c)ABRLoans,whichbearinterestatarateperannumequaltotheApplicableMargin
forABRLoansplustheABR,(d)EuropeanBaseRateLoans,whichbearinterestatarateperannumequaltotheApplicableMarginforEuropeanBaseRate
LoansplustheEuropeanBaseRate,(e)LIBORLoans,whichbearinterestatarateperannumequaltotheApplicableMarginforLIBORLoansplustheLIBO
Rateor(f)EURIBORLoans,whichbearinterestatarateperannumequaltotheApplicableMarginforEURIBORLoansplustheapplicableEURIBOR.
AcommitmentfeewillbechargedontheaveragedailyunusedportionoftheRevolvingFacilityof0.25%perannumifaverageutilizationundertheRevolving
Facilityisgreaterthan50%or0.375%ifaverageutilizationundertheRevolvingFacilityislessthan50%.Aletterofcreditfee,withrespecttostandbylettersof
creditwillaccrueontheaggregatefaceamountofoutstandinglettersofcreditundertheRevolvingFacilityequaltotheApplicableMarginforLIBORLoans,and,
withrespecttotradeorcommerciallettersofcredit,50%ofthethenapplicableApplicableMarginonLIBORLoans.Afrontingfeewillbechargedonthe
aggregatefaceamountofoutstandinglettersofcreditequalto0.125%perannum.Inaddition,wepaytheadministrativeagentundertheRevolvingFacilitya
monitoringfeeof$1,000permonth.
AsofDecember31,2016wehad$59.8millionoutstandingundertheRevolvingFacility.AmountsundertheRevolvingFacilitymaybeborrowed,repaidandre-
borrowedtofundourgeneralcorporatepurposesandare
68
Table of Contents
availableinCanadiandollars,U.S.dollars,andEurosand,subjecttoanaggregatecapof$40.0million,suchothercurrenciesasareapprovedinaccordancewith
thecreditagreementgoverningtheRevolvingFacility.
TheinitialinterestrateonthetermloansoutstandingundertheTermLoanFacilityistheLIBORRate(subjecttoaminimumrateof1.00%perannum)plusan
ApplicableMarginof5.00%.ThetermloanscanalsobemaintainedasABRLoanswhichbearinterestatABRplusanApplicableMarginwhichis1.00%lessthan
thatforLIBORloans.Effectiveonthefirstdayimmediatelyfollowingthe180-dayanniversaryoftheTermLoanClosingDateand,thelastdayofeachthree-
monthperiodthereafter,theApplicableMarginshallincreaseby0.50%,if,uponthecompletionofthisofferingandaftergivingeffecttotheprepaymentofterm
loansundertheTermLoanFacilitywiththenetcashproceedsfromthisoffering,theBorrowersconsolidatedtotalnetleverageratioisnotequaltoorlessthan
2.50to1.00;provided,however,thattheApplicableMarginshallnot,atanytime,exceedfortermloansthatareLIBORLoans,7.00%,andforInitialTermLoans
thatareABRLoans,6.00%.Ifuponthecompletionofthisoffering(oranyotherunderwrittenprimarypublicofferingofcommonequitybytheBorrowerorany
directorindirectparentthereof)andaftergivingeffecttotheprepaymentoftermloansundertheTermLoanFacilitywiththenetcashproceedsfromthisoffering,
theBorrowerhasaconsolidatedtotalnetleverageratiooflessthanorequalto2.50to1.00,theApplicableMarginthenineffectshallbepermanentlyreducedby
1.00%.WehavenotyetdeterminedwhattheconsolidatedtotalnetleverageratiooftheBorrowerwillbefollowingthecompletionofthisoffering.
TheproceedsofthetermloansborrowedundertheTermLoanFacilitywereusedtoeffectthestepsdescribedinthisprospectusunderTheRecapitalization,to
paytransactionexpensesinconnectionwiththeclosingoftheTermLoanFacilityandforothergeneralcorporatepurposes.
AsofDecember31,2016wehadapproximately$218.3millionaggregateprincipalamountoftermloansoutstandingundertheTermLoanFacility.Amounts
prepaidorrepaidundertheTermLoanFacilitymaynotbere-borrowed.
69
Table of Contents
Contractual Obligations
ThefollowingtablesummarizescertainofoursignificantcontractualobligationsandotherobligationsasatDecember31,2016:
Total contractual obligations 102,572 27,024 27,187 26,994 85,723 271,267 540,767
AsatDecember31,2016,thecompanyhadadditionallongtermliabilitieswhichincludedprovisions,includingwarranty,agentterminationfees,salesreturns,and
assetretirementobligation,anddeferredincometaxliabilities.Theselongtermliabilitieshavenotbeenincludedinthetableaboveasthetimingandamountof
futurepaymentsareuncertain.
WearealsoexposedtofluctuationsinthepricesofU.S.dollardenominatedpurchasesasaresultofchangesinU.S.dollarexchangerates.Adepreciating
CanadiandollarrelativetotheU.S.dollarwillnegativelyimpactoperatingincomeandnetearningsbyincreasingourcostsofrawmaterials,whileanappreciating
CanadiandollarrelativetotheU.S.dollarwillhavetheoppositeimpact.DuringtheninemonthsendedDecember31,2016andfiscal2016,2015,and2014we
enteredintoderivativeinstrumentsintheformofforwardcontractstomanagethemajorityofourcurrentandanticipatedexposuretofluctuationsinU.S.dollar,
GBP,Euro,andCHFexchangerates.
AmountsborrowedundertheTermLoanFacilityaredenominatedinU.S.dollars.Basedonouroutstandingbalanceof$218.3millionundertheTermLoan
FacilityasofDecember31,2016,a10%depreciationinthevalueoftheCanadiandollarcomparedtotheU.S.dollarwouldresultinadecreaseinournetincome
(loss)of$21.8millionsolelyasaresultofthatexchangeratefluctuationseffectonsuchdebt.Weintendtousetheproceedsfromthisofferingtorepayaportion
oftheTermLoanFacility.Inadditionweintendtouseforeigncurrencyhedgingcontractstoreducetheforeigncurrencyexchangeriskduetosuchdebt.
70
Table of Contents
Wemayenterintoforeigncurrencyforwardexchangecontractsandoptionstoreducefluctuationsinourlongorshortcurrencypositionsrelatingprimarilyto
purchasecommitments,rawmaterialsandfinishedgoodsdenominatedinforeigncurrencies.
AsummaryofforeigncurrencyforwardexchangecontractsandthecorrespondingamountsasatDecember31,2016contractedforwardratesisasfollows:
Contract Primary
($000s) Amount Currencies
Forwardexchangecontracttopurchasecurrency CHF1,000 SwissFrancs
Forwardexchangecontracttosellcurrency US$11,500 USdollars
5,000 Euros
4,500 PoundsSterling
Thefollowingaretheaccountingpoliciessubjecttojudgmentsandkeysourcesofestimationuncertaintythatthecompanybelievescouldhavethemostsignificant
impactontheamountsrecognizedintheconsolidatedfinancialstatements.
Inventories. Inventoriesarecarriedatthelowerofcostandnetrealizablevaluewhichrequiresthecompanytoutilizeestimatesrelatedtofluctuationsin
obsolescence,shrinkage,futureretailprices,seasonalityandcostsnecessarytoselltheinventory.
71
Table of Contents
Weperiodicallyreviewourinventoriesandmakeprovisionsasnecessarytoappropriatelyvalueobsoleteordamagedgoods.Inaddition,aspartofinventory
valuations,weaccrueforinventoryshrinkageforlostorstolenitemsbasedonhistoricaltrendsfromactualphysicalinventorycounts.
Impairment of non-financial assets (goodwill, intangible assets, and property and equipment). Managementisrequiredtousejudgmentindeterminingthe
groupingofassetstoidentifytheircashgeneratingunits(CGU)forthepurposesoftestingfixedassetsforimpairment.Judgmentisfurtherrequiredtodetermine
appropriategroupingsofCGUsforthelevelatwhichgoodwillandintangibleassetsaretestedforimpairment.Forthepurposeofgoodwillandintangibleassets
impairmenttesting,CGUsaregroupedatthelowestlevelatwhichgoodwillandintangibleassetsaremonitoredforinternalmanagementpurposes.Inaddition,
judgmentisusedtodeterminewhetheratriggeringeventhasoccurredrequiringanimpairmenttesttobecompleted.
IndeterminingtherecoverableamountofaCGUoragroupofCGUs,variousestimatesareemployed.Thecompanydeterminesvalueinusebyusingestimates
includingprojectedfuturerevenues,earningsandcapitalinvestmentconsistentwithstrategicplanspresentedtotheBoard.Discountratesareconsistentwith
externalindustryinformationreflectingtheriskassociatedwiththespecificcashflows.
Thecompanyentersintofinancialinstrumentswithhighly-ratedcreditworthyinstitutionsandinstrumentswithliquidmarketsandreadily-availablepricing
information.
72
Table of Contents
Warranty. Thecriticalassumptionsandestimatesusedindeterminingthewarrantyprovisionatthebalancesheetdateare:numberofjacketsexpectedtorequire
repairorreplacement;proportiontoberepairedversusreplaced;periodinwhichthewarrantyclaimisexpectedtooccur;costofrepair;costofjacketreplacement;
risk-freerateusedtodiscounttheprovisiontopresentvalue.Weupdateourinputstothisestimateonaquarterlybasistoensuretheprovisionreflectsthemost
currentinformationregardingourproducts.
Wedidnothaveinplaceaneffectivecontrolenvironmentwithformalprocessesandproceduresoranadequatenumberofaccountingpersonnelwiththe
appropriatetechnicaltrainingin,andexperiencewith,IFRStoallowforadetailedreviewofcomplexaccountingtransactionsthatwouldidentifyerrorsinatimely
manner,includinginventorycostingandbusinesscombinations.Wedidnotdesignormaintaineffectivecontrolsoverthefinancialstatementcloseandreporting
processinordertoensuretheaccurateandtimelypreparationoffinancialstatementsinaccordancewithIFRS.Inaddition,informationtechnologycontrols,
includingenduserandprivilegedaccessrightsandappropriatesegregationofduties,includingforcertainuserstheabilitytocreateandpostjournalentries,were
notdesignedoroperatingeffectively.
Wehavetakenstepstoaddressthesematerialweaknessesandcontinuetoimplementourremediationplan,whichwebelievewilladdresstheirunderlyingcauses.
Wehaveengagedexternaladvisorstoprovideassistanceintheareasofinformationtechnology,internalcontrolsoverfinancialreporting,andfinancialaccounting
intheshorttermandtoevaluateanddocumentthedesignandoperatingeffectivenessofourinternalcontrolsandassistwiththeremediationandimplementationof
ourinternalcontrolsasrequired.Weareevaluatingthelongertermresourceneedsofourvariousfinancialfunctions.Theseremediationmeasuresmaybetime
consuming,costly,andmightplacesignificantdemandsonourfinancialandoperationalresources.Althoughwehavemadeenhancementstoourcontrol
proceduresinthisarea,thematerialweaknesseswillnotberemediateduntilthenecessarycontrolshavebeenimplementedandareoperatingeffectively.Wedo
notknowthespecifictimeframeneededtofullyremediatethematerialweaknessesidentified.SeeRiskFactors.
73
Table of Contents
effectivedateofthepronouncement.Informationonnewstandards,amendments,andinterpretationsareprovidedbelow.
In2016,theIASBissuedIFRS16,Leases(IFRS16),replacingIAS17,Leasesandrelatedinterpretations.Thestandardintroducesasingleon-statementof
financialpositionrecognitionandmeasurementmodelforlessees,eliminatingthedistinctionbetweenoperatingandfinanceleases.Lessorscontinuetoclassify
leasesasfinanceandoperatingleases.IFRS16becomeseffectiveforannualperiodsbeginningonorafterJanuary1,2019,andistobeappliedretrospectively.
EarlyadoptionispermittedifIFRS15,RevenuefromContractswithCustomers(IFRS15)hasbeenadopted.Thecompanyiscurrentlyassessingtheimpactof
thenewstandardonitsconsolidatedfinancialstatements.
In2014,theIASBissuedIFRS15,replacingIAS18,Revenue,IAS11,ConstructionContracts,andrelatedinterpretations.Thenewstandardprovidesa
comprehensiveframeworkfortherecognition,measurementanddisclosureofrevenuefromcontractswithcustomers,excludingcontractswithinthescopeofthe
accountingstandardsonleases,insurancecontractsandfinancialinstruments.IFRS15becomeseffectiveforannualperiodsbeginningonorafterJanuary1,2018,
andistobeappliedretrospectively.Earlyadoptionispermitted.Thecompanyiscurrentlyassessingtheimpactofthenewstandardonitsconsolidatedfinancial
statements.
InJuly2014,theIASBissuedthefinalversionofIFRS9,whichreflectsallphasesofthefinancialinstrumentsprojectandreplacesIAS39,Financial
Instruments:RecognitionandMeasurement,andallpreviousversionsofIFRS9.Thestandardintroducesnewrequirementsforclassificationandmeasurement,
impairment,andhedgeaccounting.IFRS9ismandatorilyeffectiveforannualperiodsbeginningonorafterJanuary1,2018.Earlyadoptionispermitted.The
companyiscurrentlyassessingtheimpactofthenewstandardonitsconsolidatedfinancialstatements.
AmendmentstoIAS7,StatementofCashFlows(IAS7)wereissuedbytheIASBinJanuary2016.Theamendmentclarifiesthatentitiesshallprovide
disclosuresthatenableusersoffinancialstatementstoevaluatechangesinliabilitiesarisingfromfinancingactivities.TheamendmenttoIAS7iseffectivefor
annualperiodsbeginningonorafterJanuary1,2017.Thecompanyiscurrentlyassessingtheimpactofthenewstandardonitsconsolidatedfinancialstatements.
InJanuary2016,theInternationalAccountingStandardsBoard(IASB)issuedamendmentstoclarifytherequirementsforrecognizingdeferredtaxassetson
unrealizedlosses.Theamendmentsclarifytheaccountingfordeferredtaxwhereanassetismeasuredatfairvalueandthatfairvalueisbelowtheassetstaxbase.
Theyalsoclarifycertainotheraspectsofaccountingfordeferredtaxassets.TheamendmentsareeffectivefortheyearbeginningonorafterJanuary1,2017.The
companyiscurrentlyassessingtheimpactoftheseamendmentsonitsfinancialstatements.
InJune2016,theIASBissuedanamendmenttoIFRS2,Share-basedPayment,clarifyingtheaccountingforcertaintypesofshare-basedpaymenttransactions.The
amendmentsproviderequirementsonaccountingfortheeffectsofvestingandnon-vestingconditionsofcash-settledshare-basedpayments,withholdingtax
obligationsforshare-basedpaymentswithanetsettlementfeature,andwhenamodificationtothetermsofashare-basedpaymentchangestheclassificationofthe
transactionfromcash-settledtoequity-settled.TheamendmentsareeffectivefortheyearbeginningonorafterJanuary1,2018.Thecompanyiscurrently
assessingtheimpactofthisamendmentonitsfinancialstatements.
AmendmentstoIAS1,PresentationofFinancialStatements(IAS1)wereissuedbytheIASBinDecember2014.Theamendmentsclarifyprinciplesforthe
presentationandmaterialityconsiderationsforthefinancialstatementsandnotestoimproveunderstandabilityandcomparability.TheamendmentstoIAS1are
effectiveforannualperiodsbeginningonorafterJanuary1,2016.Thecompanyisevaluatingtheimpactofthisstandardonitsconsolidatedfinancialstatements.
74
Table of Contents
JOBS Act
WewillnottakeadvantageoftheextendedtransitionperiodprovidedunderSection7(a)(2)(B)oftheSecuritiesActforcomplyingwithneworrevisedaccounting
standards.BecauseIFRSstandardsmakenodistinctionbetweenpublicandprivatecompaniesforpurposesofcompliancewithneworrevisedaccounting
standards,therequirementsforourcomplianceasaprivatecompanyandasapubliccompanyarethesame.
75
Table of Contents
ToourShareholders,
Whenmygrandfatherstartedthiscompany60yearsago,Idontknowifheeverdreamedthatthisiswherewewouldbetoday,butIamsurehewouldbeproud.
ThatpridehasbeenacornerstonethroughoutthreegenerationsofCanadaGooseand,today,Iambothhumbledandexcitedtobewritingthisletter.
Since1957,wehavegoneagainstthegrain,stayedtruetowhoweareandsurpassedourexpectationsatalmosteveryturn.Wehaveturnedbusinesschallengesinto
leadershipopportunitiesandintuitionintoinsight,investedheavilywhenothersonlychasedmarginsandwehavedemonstratedthatdoinggoodisgoodfor
business.Inaworldoffabricatedstories,wehavegivenpeoplesomethingrealtoexperience.
Forthreegenerations,CanadaGoosehashelpedpeoplefromallcornersoftheglobeembracetheelementsandmaketheiradventurespossible.WeoutfittedLaurie
Skreslet,thefirstCanadiantosummitMountEverestin1982,andhelpedaformertwo-packs-a-daysmoker,RayZahab,breaktheworldspeedrecordforan
unsupportedexpeditionbyateamtotheSouthPole.WehelpedanursewhowasplungedintotheicywatersofHudsonBaykeephercoretemperaturewarm
enoughtokeepherheartbeating.WehelpedLanceMackey,championdog-musherandcancersurvivor,staywarmashewontheIditarodandYukonQuest,two
yearsinarow.WehelpprotectFirstAircrewsfromtheelementswhentheyreflyingnorthof60-degreesandwehelpresearchersinAntarcticaandPolarBears
Internationalscientistsworkoutsideforhoursinfreezingtemperatures.Andalongthewaywehavefoundahomeinurbancentrestoo.Wevebroughtthesame
function,qualityandcraftsmanshipintogreatcitiesaroundtheworldincludingToronto,NewYork,London,Paris,Tokyoandmanyothersinbetween.
Indoingso,wehaveplayedaleadingroleinthecreationofanewcategory,premiumouterwear,andestablishedCanadaGooseasaniconicbrand.Wehavealso
inventednewtechnologies,challengedtraditionalthinking,soldintoleadingretailersaroundtheworldandopenedexperientialstoresofourown.Wehavemade
award-winningproductsandaward-winningmarketingcampaigns,beenembracedbyworld-renownedartists,athletesandadventurers,helpedreinvigoratethe
decliningapparelindustryinCanadabycreatingthousandsofjobsandplayedtheroleofambassadorforourcountryinternationally.Intheprocess,wevebecome
abrandtowatchandonethatothercompaniestrytoemulateanauthenticleaderonaglobalstage.
Authenticityiseverythingtous.Itiswovenintoeveryaspectofourbusinessfromhowwedesignandbuildourproductstohowweengagewithourcustomers.
Thatcommitmentdoesnotcomewithoutitschallenges,butwebelieveitistheonlywayforustobuildanenduringbrandthatwillcontinueforgenerations.
Farfromthiscompanyshumblebeginnings,wenowproudlysellin36countries.Today,CanadaGooseisabrandthatisknownaroundtheworld.Weareproud
tobeachampionofMade-in-CanadamanufacturingandexportthebrandofCanadaaroundtheworld.WebelievethatCanadaGooseisgoodforCanadaandfor
theworld.
Fueledbystrongperformance,aboldvisionthatsunderpinnedbyworld-classtalentwhohaveexperiencegarneredfromsomeoftheworldsbestbrands,a
relentlessfocusonexecutionandaninspiringculture,Ibelievewehaveanextraordinaryopportunityahead.Wehavealltherightpiecesinplacetobuildthis
companytobetheenduringlegacyIknowitcanbe.
Butwewillbecareful.Wearenotinterestedintradingshorttermrevenueopportunitiesforbadlongtermbusinessdecisions.Wearefocusedonbuildingan
enduringbrand,alegacyforouremployeesandourcountryandlong-termvalueforourshareholders.Wehavebeencarefulstewardsofthisbrandfor60yearsand
wewilldothesameasapublicly-tradedcompanyintheyearsahead.
Thatmaymeanwewontalwayschoosetheobviouspathordowhattraditionalthinkingwoulddictate.Wewouldnotbewherewearetodayifwehaddonewhat
everyoneelsewasdoingorwhatwaseasy.Wehavetakenrisksthatwebelievedinandwehavesucceededindoingso.Weintendtocontinueonourpathof
swimmingupstream.Itscertainlymorechallenging,butmorefunandmorerewarding.
Weareonaremarkablejourney,onethatIfeelincrediblyprivilegedtoleadandonethatIhopeyouwillbeproudtobeapartof.Thisisyourinvitation.
DaniReiss,C.M.
President&CEO
250BOWIEAVENUETORONTO,ONTARIOM6E4Y2CANADA
76
Table of Contents
Business
Canada Goose
Founded60yearsagoinasmallTorontowarehouse,CanadaGoosehasgrownintoahighlycovetedglobalouterwearbrand.Wearerecognizedforauthentic
heritage,uncompromisedcraftsmanshipandquality,exceptionalwarmthandsuperiorfunctionality.Thisreputationisdecadesinthemakingandisrootedinour
commitmenttocreatingpremiumproductsthatdeliverunrivaledfunctionalitywhereandwhenitisneededmost.BeitCanadianArcticRangersservingtheir
countryoranexplorertrekkingtotheSouthPole,peoplewholive,workandplayintheharshestenvironmentsonEarthhaveturnedtoCanadaGoose.Throughout
ourhistory,wehavefoundinspirationinthesetechnicalchallengesandparlayedthatexpertiseintocreatingexceptionalproductsforanyoccasion.Fromresearch
facilitiesinAntarcticaandtheCanadianHighArctictothestreetsofToronto,NewYorkCity,London,Paris,Tokyoandbeyond,peoplehavefalleninlovewith
ourbrandandmadeitapartoftheireverydaylives.
Wearedeeplyinvolvedineverystageofourbusinessasadesigner,manufacturer,distributorandretailerofpremiumouterwearformen,womenandchildren.
Thisverticallyintegratedbusinessmodelallowsustodirectlycontrolthedesignanddevelopmentofourproductswhilecapturinghighermargins.AsofDecember
31,2016,ourproductsaresoldthroughselectoutdoor,luxuryandonlineretailersanddistributorsin36countries,oure-commercesitesinCanada,theUnited
States,theUnitedKingdomandFrance,andtworecentlyopenedretailstoresinTorontoandNewYorkCity.
Thepowerofourbusinessmodelandourabilitytoprofitablyscaleouroperationsarereflectedinourfinancialperformance.Infiscal2016,wehadrevenueof
$290.8million,grossprofitof$145.6million,whichrepresentedgrossmarginof50.1%,netincomeof$26.5million,AdjustedEBITDAof$54.3million,
AdjustedEBITDAMarginof18.7%andAdjustedNetIncomeof$30.1million.Wegrewourrevenueata38.3%CAGR,netincomeata196.0%CAGRand
AdjustedEBITDAatan85.0%CAGRfromfiscal2014tofiscal2016,whileexpandingourgrossmarginfrom38.6%to50.1%andourAdjustedEBITDAMargin
from10.4%to18.7%overthesameperiod.ForadditionalinformationregardingAdjustedEBITDA,AdjustedEBITDAMarginandAdjustedNetIncome,which
arenon-IFRSmeasures,includingareconciliationofthesenon-IFRSmeasurestonetincome,seeManagementsDiscussionandAnalysisofFinancialCondition
andResultsofOperationsNon-IFRSMeasures.
77
Table of Contents
Goosejacketsand84%ofcustomersindicatethat,whenmakingtheirnextpremiumouterwearpurchase,theywouldlikelyrepurchaseCanadaGoose.These
resultsareamongthehighestinourindustrybasedonthissurvey.
Proudly made in Canada. OurCanadianheritageandcommitmenttolocalmanufacturingareattheheartofourbusinessandbrand.Whilemany
companiesinourindustryoutsourcetooffshoremanufacturers,wearecommittedtoaggressivelyinvestinginproducingpremium,highqualityproductsin
Canada,thecountryfromwhichwedrawourinspiration.WebelieveourCanadianproductionfacilitiesandcraftspeoplehavesetusapartonthe
internationalstageandinthemindsofourcustomers.
Flexible supply chain. Wedirectlycontrolthedesign,innovation,development,engineeringandtestingofourproducts,whichwebelieveallowsusto
achievegreateroperatingefficienciesanddeliversuperiorqualityproducts.Wemanageourproductionthroughacombinationofin-housemanufacturing
facilitiesandlong-standingrelationshipswithCanadianthirdpartysub-contractors.Ourflexiblesupplychaingivesusdistinctadvantagesincludingthe
abilitytoscaleouroperations,adapttocustomerdemand,shortenproductdevelopmentcyclesandachievehighermargins.
Multi-channel distribution. Ourglobaldistributionstrategyallowsustoreachcustomersthroughtwodistinct,brand-enhancingchannels.Inourwholesale
channel,whichasofDecember31,2016extendsinto36countries,wecarefullyselectthebestretailpartnersanddistributorstorepresentourbrandina
mannerconsistentwithourheritageandgrowthstrategy.Asaresult,ourretailpartnershipsincludebest-in-classoutdoor,luxuryandonlineretailers.
ThroughourfastgrowingDTCchannel,whichincludesoure-commercesitesinfourcountriesandtworecentlyopenedretailstores,weareabletomore
directlycontrolthecustomerexperience,drivingdeeperbrandengagementandloyalty,whilealsorealizingmorefavorablemargins.Weemployproduct
supplydisciplineacrossbothofourchannelstomanagescarcity,preservebrandstrengthandoptimizeprofitablegrowthforusandourretailpartners.
Passionate and committed management team. Throughsteadybranddisciplineandafocusonsustainablegrowth,ourmanagementteamhastransformed
asmallfamilybusinessintoaglobalbrand.DaniReiss,ourCEO,hasworkedinalmosteveryareaofourcompanyandsuccessfullydevelopedour
internationalsaleschannelspriortoassumingtheroleofCEOin2001.Danihasassembledateamofseasonedexecutivesfromdiverseandrelevant
backgroundswhodrawonanaverageofover15yearsexperienceworkingwithawiderangeofleadingglobalcompaniesincludingMarcJacobs,New
Balance,Nike,Patagonia,RalphLauren,McKinsey,UFCandRedBull.Theirleadershipandpassionhaveacceleratedourevolutionintoathreeseason
lifestylebrandandtherolloutofourDTCchannel.
78
Table of Contents
ofCanadaGoose.Throughacombinationoftheorganic,word-of-mouthbrandbuildingthathasdrivenmuchofoursuccesstodateandamoreproactive
approachtoreachingnewaudiencesthroughtraditionalchannels,wewillcontinuetointroducetheCanadaGoosebrandtotheworld.
Enhance our wholesale network. Weintendtocontinuebroadeningcustomeraccessandstrengtheningourglobalfootholdinnewandexistingmarketsby
strategicallyexpandingourwholesalenetworkanddeepeningcurrentrelationships.Inallofourmarkets,wehaveanopportunitytoincreasesalesbyadding
newwholesaledoorsandincreasingvolumeinexistingretailers.Additionally,wearefocusedonstrengtheningrelationshipswithourretailpartnersthrough
broaderofferings,exclusiveproductsandshop-in-shopformats.Webelieveourretailpartnershaveastrongincentivetoshowcaseourbrandasourproducts
drivecustomertrafficandconsistentfull-pricesell-throughintheirstores.
Accelerate our e-commerce-led Direct to Consumer rollout. OurDTCchannelservesasanunfilteredwindowintoourbrandwhichcreatesmeaningful
relationshipsanddirectengagementwithourcustomers.Thisdrivesopportunitiestogenerateincrementalrevenuegrowthandcapturefullretailmargin.We
haverapidlygrownouronlinesalesto$33.0millioninfiscal2016,whichrepresented11.4%ofourconsolidatedrevenue.Wehavesubsequentlylaunched
newonlinestorefrontsintheUnitedKingdomandFranceandplantocontinueintroducingonlinestoresinnewmarkets.Oure-commerceplatformis
complementedbyourtworecentlyopenedretailstoresinTorontoandNewYorkCity.Weintendtoopenaselectnumberofadditionalretaillocationsin
majormetropolitancentresandpremiumoutdoordestinationswherewebelievetheycanoperateprofitably.
Total
$152.1
$218.4
$290.8
38.3%
Canada. WhilewehaveachievedhighbrandawarenessinCanada,wecontinuetoexperiencestrongpenetrationandrevenuegrowthdrivenprimarilyby
expandingaccessandproductofferings.Afterdevelopingastrongwholesalefootprint,wesuccessfullylaunchedourCanadiane-commerceplatformin
August2014andopenedourfirstretailstoreinTorontoinOctober2016.Weexpecttofurtherdevelopourpresencethroughincreasedstrategicmarketing
activities,deeperrelationshipswithourretailpartnersandcontinuedfocusonourDTCchannel.Additionally,weintendtocontinuebroadeningourproduct
offering,tomakeCanadaGooseabiggerpartofourcustomerslives.
United States. AswecontinuetocapturethesignificantmarketopportunityintheUnitedStates,ourfocusisonincreasingbrandawarenesstoalevelthat
approacheswhatwehaveachievedinCanada.AccordingtoanAugust2016consumersurveyconductedonourbehalf,aidedbrandawarenessintheUnited
Statesis16%ascomparedto76%inCanada.Ourmarketentryhasbeenstagedonaregionalbasis,withthebulkofourinvestmentsandwholesale
penetrationconcentratedintheNortheast,whereouraidedbrandawarenessis25%andashighas46%inBostonandNewYorkCity.Thishasbeenthe
primarydriverofourhistoricalgrowthandmomentumintheU.S.andwecontinuetogeneratestronggrowthintheregion.Buildingonthissuccess,we
launchedournationale-commerceplatforminSeptember2015andopenedourfirstretailstoreinNewYorkCityinNovember2016.Webelievethereisa
largewhitespaceopportunityinotherregionssuchasthe
79
Table of Contents
Mid-AtlanticaswellastheMidwest,whereouraidedbrandawarenessiscurrently18%,andWest,whereouraidedbrandawarenessis14%andashighas
26%inmetropolitanmarketssuchasDenverandSanFrancisco.Aswesequentiallyintroduceourbrandtotherestofthecountry,wearefocusedon
expandingourwholesalefootprint,includingexecutingourshop-in-shopstrategyandcontinuingtodeliverabroaderthreeseasonproductassortmenttoour
partners.
Rest of World. WecurrentlygeneratesalesineverymajorWesternEuropeanmarketand,whilethisiswherethebrandfirstachievedcommercialsuccess,
webelievetherearesignificantopportunitiestoacceleratethesemarketstotheirfullpotential.IntheUnitedKingdomandFranceinparticular,wehave
achievedstrongtractionthroughourretailpartnerships,buthaveyettofullyextendourwholesalenetworkandareonlyintheinitialphaseofexecutingon
ourshop-in-shopstrategy.Inbothmarkets,welaunchedoure-commerceplatformsinSeptember2016andintendtoestablishourownedretailpresencein
thenearfuture.WhiletheUnitedKingdomandFranceareourmostdevelopedEuropeanmarkets,wehaveidentifiedanumberofmarketswithsignificant
near-termdevelopmentpotential,suchasGermany,ItalyandScandinavia.
OutsideofEurope,ourmostestablishedmarketsareJapanandKorea.Overthepastdecade,wehavegrownsuccessfullyinJapanand,inbothJapanand
Korea,recentlypartneredwithworld-classdistributors.Thesepartnerswillhelpuscontinuetobuildawarenessandaccesstothebrandwhileensuringits
longtermsustainability.Additionally,wecurrentlyhaveaminimalpresenceinChinaandotherlargemarketswhichrepresentsignificantfuture
opportunities.
Overthepastthreefiscalyears,wehavenearlydoubledourmarketpenetrationinCanadatoreachapproximately35unitsalesper1,000addressable
customers(peoplelivingabovethe37thParallelandwithannualhouseholdincomeofgreaterthan$100,000).Wehavebeensimilarlysuccessfulinthe
UnitedStates,WesternEurope,ScandinaviaandAsiawithunitssalesper1,000addressablecustomersreachingbetween3.5and10units,butwestillhave
roomtogrowinourcurrentmarkets.Evenwithoutexpandingourgeographicfootprintorourproductlines,webelievewehavesignificantopportunityto
furtherincreasepenetrationintheUnitedStates,WesternEurope(Sweden,Denmark,Norway,Finland,France,UnitedKingdom,theNetherlands,Spain,
Germany,Austria,BelgiumandItaly),ScandinaviaandAsia(JapanandSouthKorea);ifweweretoachieve50%ofcurrentpenetrationinCanadainthese
othergeographies,thiswouldresultintripledunitdemandwithinourFallandWinterproductcategories.
80
Table of Contents
81
Table of Contents
History
Overthelast60years,wehavegrownfromamanufacturerofprivatelabelparkasintooneoftheworldsmostdesiredouterwearbrands.Fueledbyourcorebelief
thatgreatnessisoutthereandbuildingonourstrengthofcreatingpremiumfunctionaljackets,wehaveextendedourbrandintothreeseasonsandnewcategories
beyondtheparka.Withthesamediscipline,wehaveexpandedoursaleschannelsbeyonddistributorstoincludeaselectgroupofoutdoor,luxuryandonline
retailersaswellas,morerecently,ourownDTCchannel.Ateverystep,wehavestayedtruetoourheritage,whichwebelievehassetusapart.
Our Products
Our arctic heritage .AuthenticityiseverythingtoCanadaGoose.Webeganasanouterwearmanufacturerfocusedprimarilyonprovidingparkastopeople
workingintheharshestenvironmentonEarththeArctic.From
82
Table of Contents
thecrewofanorthernCanadianairline,FirstAir,toCanadianArcticRangers,wehavebeentrustedtohelpkeeppeoplewarm.Fordecades,thisutilitarian,
functionalhistoryhasbeencoretoourheritage.Toensurewedeliveraproductthatperformswhenandwhereitisneededmost,westrivetomakethebest
productsoftheirkindbyusingthehighestqualityrawmaterialsandcraftsmanship.
Theprecisionofeverycut,foldandstitchinourproductsisguidedbydecadesofexperience.Fromzippertobuttonandstitchtostitch,everyelementiscarefully
chosenandmeticulouslyputintoplacebyhand.EveryCanadaGoosejacketpassesthroughthehandsofmultiplecraftspeople,allunitedbyourcommitmentto
uncompromisingquality.Ourqualityassuranceteaminspectseveryjackettoensurenodetailisoverlooked.Webelieveourbest-in-classCanadianmanufacturing
capabilitiesandpartnershipsaffordusincreasedqualitycontrolanddirectinvolvementinallstagesoftheprocess,enablingustostandbehindourouterwearwitha
lifetimewarrantyagainstdefectsinmaterialsandworkmanship.
Recognizingourcustomerswanttobringthefunctionalityofourjacketsintotheireverydaylives,weexpandedourofferingtoincludeproductsforoutdoor
enthusiasts,urbanexplorersanddiscerningconsumerseverywhere.Truetoourheritage,wepartneredwithextraordinaryGoosePeopleasasourceofinspiration
andreal-worldtesting.WhetherdevelopingnovelHyBridgeproductsforRayZahabtoruntheSaharaorcustom-designingLaurieSkresletscoattosummit
Everest,whichinspiredourAltitudeline,CanadaGoosehasfoundinspirationineverytechnicalchallengeandparlayedthatexpertiseintocreatingexceptional
productsforanyoccasion.
TheuncompromisedcraftsmanshipandqualityoftheCanadaGoosebrandispreservedinnewproductsandhighperformancematerialstokeepourcustomers
warmandcomfortablenomatterhowlowthetemperaturedrops.Accordingtoourcustomerswhorespondedtoourconsumersurveyourjacketsarethewarmestas
comparedtootherouterwearbrands.Asweevolvedandexpandedourwinterassortmenttosuitnewuses,climatesandgeographies,wealsorefreshedourcore
offeringswiththeintroductionofourBlackLabelcollection,enhancingourclassicproductswithafocusonelevatedstyle,luxuriousfabricsandrefinedfits.
OurbroadsetofmanufacturingcapabilitiesandaccesstoinnovativematerialsrangingfromArcticTechandTri-DurancefabricstoluxuryLoroPianawoolenable
ustomeetcustomersneedsintheArctic,ondesignerrunwaysandnearlyeverywhereinbetween.AtthesametimeasourcoatskeepCanadianlawenforcement
warmandequipGoosePeopleonepicadventures,ourcollaborationswithMarcJacobs,Levis,musicianDrakesOctobersVeryOwn(OVO)fashionbrand,
professionalbaseballplayerJosBautistaandothershavebeenmetwithstrongacclaim.Thesecollaborationshelpextendourbrandtonewaudiencesand
introduceinspiringnewstylestothosewhoalreadyloveCanadaGoose.
OurSpringandFallcollectionshavedemonstratedmeaningfultractionwithconsumers,achievinga60%increaseinsalesbetweenfiscal2015andfiscal2016.
Theyhavealsobeenmetwithgreatcriticalacclaim:HyBridgeLitewontheGearofTheYearAwardfromOutsideMagazinein2011andourSpring2017
collectionwasnamedEditorsPickbyWorldsGlobalStyleNetwork(WGSN),aleadingtrendforecaster.
83
Table of Contents
84
Table of Contents
durableproductsacrossseasonsandapplications.Ourproductsaremadewithdownbecauseitisrecognizedastheworldsbestnaturalinsulator,providing
approximatelythreetimesthewarmthperounceassyntheticalternativesand,whennecessary,trimmedwithrealfurtoprotecttheskinfromfrostbiteinharsh
conditions.
Wearecommittedtothesustainableandethicalsourcingofourrawmaterials.Wehaveintroducedcomprehensivetraceabilityprogramsforfuranddown
throughoutoursupplychainwhichweexpectwillbefullyineffectduringthespringof2017.Weonlyusedownthatisabyproductofthepoultryindustryandwe
onlypurchasedownandfurfromsupplierswhoadheretoourstringentstandardsregardingfairpracticesandhumanetreatmentofanimals.
AsofMarch1,2017,weoperatefiveproductionfacilitiesinToronto,WinnipegandMontreal,manufacturingapproximatelyone-thirdofourproductsin-house.
Wealsoworkwith32Canadianand6internationalhighlyqualifiedsubcontractorswhoofferspecializedexpertise,whichprovidesuswithflexibilitytoscaleour
productionofparkasandnon-coreproducts,respectively.Weemploy1,275manufacturingemployeesasofMarch1,2017,andhavebeenrecognizedbythe
GovernmentofCanadaforsupportingtheapparelmanufacturingindustryinCanada.Wehaveinvestedaheadofourgrowthandmorethandoubledourin-house
andcontractmanufacturingunitproductioncapacity,respectively,inthepastfiveyears.
Wholesale. Thewholesalechannelallowsustoenteranddevelopnewmarkets,maintainaleadingpositionwithinourgeographiesandmakeinformedinvestments
inourDTCinfrastructure.Aswehavegrown,wehaveevolvedwhatwasoriginallyageneralistapproachtoaccountmanagementthroughspecialistcapabilities
thatarebetteralignedwiththeneedsofspecificmarketsandretailformats.Thesecapabilitiesallowustodevelopstrategicrelationshipsdirectlywithretailersand
distributors.Weworkwithaselectsetofpartnerswhorespectourheritage,shareourvaluesandstrengthenourmarketpresence.AsofDecember31,2016,
throughourglobalnetworkofnearly2,500pointsofdistributionwithretailerssuchasSportingLife,HarryRosen,Gorsuch,SaksFifthAvenue,Nordstrom,
SelfridgesandLaneCrawfordwereachcustomersacross36countries.Ourwholesaledistributionincludesamixofoutdoor,luxuryandonlineretailers.Wedrive
trafficforourretailpartnersandleverageourmutuallybeneficialrelationshipstoreceiveprimeplacementwithintheirstores,showcaseabroaderproductoffering
andestablishCanadaGooseshops-in-shops.Carefulplanningwithourwholesalenetworkallowsustomanagescarcityandmaintainhighlevelsoffull-pricesell-
through.Overthepastthreeyears,wehavebeenintheprocessofenhancingourwholesalenetworktobringallofouraccountsin-housewithenhanced
management.Thisallowsustodeepentherelationshipswithourretailersbystrategizingonproductassortment,shop-in-shoppresentationandrollout,andcreates
opportunitiestoincreaseourthreeseasonpenetrationandtooffernewproductsthroughourretailpartners.
Oure-commercerolloutiscomplementedbyourretailstoresinpremiumhightrafficlocations.WeopenedourfirsttworetailstoresinTorontoandNewYorkCity
inthefallof2016.Goingforward,weplantoopenalimited
85
Table of Contents
numberofadditionalretailstoresinothermajormetropolitancentresaswellaspremiumoutdoordestinationswherewebelievetheycanoperateprofitably.This
unfilteredwindowintoourbrandwillallowustodevelopacloserrelationshipwithourcustomersthroughuniqueexperiences,featureourfullproductofferingand
driverevenuegrowthacrossbothchannels.
Marketing
Wehavenevertakenatraditionalmarketingapproachtodrivingconsumerawareness.Wehavetoldrealstoriesinauthenticways,fuelingbrandawarenessand
affinitythroughcreativemarketinginitiativesanddevelopingstrategicrelationshipsinrelevantindustries.Oursuccesshasbeendrivenorganicallybyword-of-
mouthmarketing.WehavefoundthattheexperiencepeoplehavewithCanadaGooseproductsissomethingtheyeagerlyandpassionatelysharewithothers,which
webelievegeneratesexceptionaldemandforourproducts.
WealsocreateoriginalcontenttodriveawarenessandunderstandingofCanadaGoose.Incelebrationofour50thanniversary,wepublishedGoose People ,a
coffeetablebookhighlighting50peoplefromaroundtheworldwhoembodyourvalues.ThiscementedoneofourkeymarketinginitiativesasGoosePeople
continuetobeanimportantwayforustoauthenticallytellourstories.In2015,webroughtsomeofthesestoriestolifeonthebigscreenthroughourcollaboration
withOscar-winningdirector,PaulHaggis,andourproductionofthefilm,Out There ,whichwasawardedtwoCannesGoldLions.
86
Table of Contents
thewarmthandfunctionalitytheyneedtosurvivelongshootsinthemostdemandingenvironments.Duetothislong-standingandorganicseedingrelationship,we
havenotpaidforproductplacement,butourproductshavenaturallytransitionedfrombehindthescenestoon-cameraasawaytoauthenticatecoldweather
scenes.Wealsosupporttheindustryasanofficialsponsorofanumberofinternationalfilmfestivals,includingtheSundanceFilmFestivalandToronto
InternationalFilmFestival.
Our Market
Strongly positioned in large and growing apparel market segment. Ourfocusonfunctionalityandqualitybroadensourreachbeyondpeopleworkinginthecoldest
placesonearthtooutdoorenthusiasts,urbanexplorersanddiscerningconsumersglobally.Ouruncompromisedcraftsmanshippositionsourproductsaspremium
technicalgarmentsandcovetedluxuryitemsintheeyesofourcustomer.Webelievethestayingpowerofourbrandstronglypositionsustocompeteinthe
growingouterwearandluxuryapparelmarkets.
Weintendtoexecuteonourprovengrowthstrategiestofurtherdevelopallofourmarketsalongthematuritycurve.ThefollowingtablesummarizesEuromonitor
International2016retailvaluemarketsizedataandanticipated20162020compoundannualgrowthratesforkeyglobalgeographies.
Source:EuromonitorApparelandFootwear2017edition,EuromonitorLuxuryGoods2017edition,RetailValueRSPincludingSalesTax,CurrentPrices.Outerwearcovers
mensandwomensclothingforoutdoor/out-of-the-housewearincludingshortsandtrousers,jeans,jacketsandcoats,suits,shirtsandblouses,jumpers,tops,dresses,skirts,
leggings.LuxuryApparelisequivalenttoDesignerApparel(Ready-to-Wear)whichistheaggregationofMensDesignerApparel,WomensDesignerApparel,Designer
Childrenswear,DesignerApparelAccessories,andDesignerHosiery.However,designerhautecoutureisexcludedfromEuromonitorInternationalscoverage.
87
Table of Contents
Forexample,aswecontinuetocapturethesignificantmarketopportunityintheUnitedStates,wearepursuingastagedregionalexpansion.Ourinitialentryinto
theU.S.marketwasconcentratedintheNortheastwherewegrewourwholesalenetworkto125doorsasofDecember31,2016and,accordingtoasurvey
conductedonourbehalfinAugust2016ofconsumersthathavepurchasedpremiumouterwear,achievedaidedbrandawarenessof46%inBostonandNewYork
City.Buildingonthis,wehavebeguntofocusonexpandingcustomeraccessviaoure-commercesiteandretailstoreinNewYorkCity.Oursuccessfulexecution
inthisregionhasbeentheprimarydriverofour75.5%revenueCAGRintheUnitedStatesfromfiscal2014tofiscal2016.
MovingbeyondoursuccessintheNortheast,werecognizeasignificantwhitespaceopportunityacrosstheUnitedStates.Wecontinuetofocusonintroducingand
strengtheningtheCanadaGoosebrandgivenrelativelylowaidedbrandawarenesslevelsof26%inkeymetropolitanmarketssuchasDenverandSanFrancisco.In
theserapidlydevelopingmarkets,weremainfocusedonexpandingourwholesalefootprint,includingexecutingourshop-in-shopstrategyandcontinuingtodrivea
broaderproductassortmenttoourpartners.Ournationale-commercepresenceoffersusadirectconnectiontoourcustomersandinformsoureffortsinhigh
potentialregionssuchastheMid-Atlantic,MidwestandPacificNorthwest.Aswecontinuetoexpandtoregionswithdiverseandtemperateclimates,ourproduct
offeringwillincludeastrongeremphasisonourexpandingSpringandFallcollections.
ThesuccesswehaveachievedinNorthAmericahasallowedustorefineandstrengthenourframeworkformarketdevelopment.Wewillcontinuetoaggressively
pursueoursubstantialglobalmarketopportunityusingourprovengrowthstrategies.
88
Table of Contents
Competition
Themarketforouterwearishighlyfragmented.Weprincipallyoperateinthemarketforpremiumouterwear,whichispartofthebroaderapparelindustry.We
competedirectlyagainstothermanufacturers,wholesalersanddirectretailersofouterwear,premiumfunctionalouterwearandluxuryouterwear.Wecompeteboth
withglobalbrandsandwithregionalbrandsoperatingonlyinselectmarkets.Becauseofthefragmentednatureofourmarketplace,wealsocompetewithother
apparelsellers,includingthosewhodonotspecializeinouterwear.Whileweoperateinahighlycompetitivemarket,webelievetherearemanyfactorsthat
differentiateusfromothermanufacturers,wholesalersandretailersofouterwear,includingourbrand,ourheritageandhistory,ourfocusonfunctionalityand
craftsmanshipandthefactthatourcoreproductsaremadeinCanada.
Intellectual Property
Weownthetrademarksusedinconnectionwiththemarketing,distributionandsaleofallofourproductsintheUnitedStates,Canadaandintheothercountriesin
whichourproductsaresold.OurmajortrademarksincludetheCANADAGOOSEwordmarkandtheARCTICPROGRAM&DESIGNtrademark(ourdisclogo
consistingofthecolour-inversedesignoftheNorthPoleandArcticOcean).InadditiontotheregistrationsinCanadaandtheUnitedStates,ourwordmarkand
designareregisteredinotherjurisdictionswhichcoverapproximately37jurisdictions.Furthermore,incertainjurisdictionsweregisterastrademarkscertain
elementsofourproducts,suchasfabric,warmthcategorizationandstylenamessuchasourSnowMantraparka.
Weenforceourtrademarksandwehavetakenseveralmeasurestoprotectourcustomersfromcounterfeitingactivities.Since2011wehavesewnaunique
hologram,designedexclusivelyforus,intoeveryjacketandaccessoryasproofofauthenticity.Additionally,ourwebsitehasatoolforpotentialonlinecustomers
toverifytheintegrityofthirdpartyretailersthatpurporttosellourproducts.Wearealsoactiveinenforcingrightsonaglobalbasistoourtrademarksandtaking
actionagainstcounterfeiters,onlineandinphysicalstores.
Government Regulation
InCanadaandintheotherjurisdictionsinwhichweoperate,wearesubjecttolabourandemploymentlaws,lawsgoverningadvertising,privacyanddatasecurity
laws,safetyregulationsandotherlaws,includingconsumerprotectionregulationsthatapplytoretailersand/orthepromotionandsaleofmerchandiseandthe
operationofstoresandwarehousefacilities.OurproductssoldoutsideofCanadaaresubjecttotariffs,treatiesandvarioustradeagreementsaswellaslaws
affectingtheimportationofconsumergoods.Wemonitorchangesintheselaws,regulations,treatiesandagreements,andbelievethatweareinmaterial
compliancewithapplicablelaws.
Our Employees
AsofMarch1,2017,weemployed1,688people,includingbothfull-timeandpart-timeemployees.Oftheseemployees,1,275wereemployedinCanadian
manufacturingpositionsand125wereemployedinNorthAmericansellingandretailpositions.Theremainingemployeeswereengagedinotheraspectsofour
business.AsofMarch1,2017,377ofouremployeesarerepresentedbyunions.Webelievethatrelationswithouremployeesaresatisfactoryandwehavenever
encounteredastrikeorsignificantworkstoppage.
89
Table of Contents
Ourprincipalofficeislocatedat250BowieAvenue,Toronto,Ontario,CanadaM6E4Y2andourtelephonenumberis(416)780-9850.Ourregisteredofficeis
locatedatSuite1700,ParkPlace,666BurrardStreet,Vancouver,BritishColumbia,Canada,V6C2X8.
Thefollowingchartreflectsourorganizationalstructure(includingthejurisdictionofformationorincorporationofthevariousentities),aftergivingeffecttothe
Recapitalizationandthecompletionofthisofferingandassumingnoexerciseoftheunderwritersover-allotmentoption:
Inconnectionwiththisofferingweamendedourarticlesinorderto,amongotherthings,amendandredesignateourClassACommonSharesasmultiplevoting
shares;eliminateourClassBCommonShares,ClassASeniorPreferredShares,ClassBSeniorPreferredShares,ClassAJuniorPreferredShares,ClassBJunior
PreferredShares,ClassCJuniorPreferredSharesandtheClassDPreferredSharesfromoursharecapital;andcreateoursubordinatevotingshares.Ourshare
capitalconsistsofanunlimitednumberofmultiplevotingsharesandsubordinatevotingsharesandanunlimitednumberofpreferredshares,issuableinseries
(noneoutstanding).SeeDescriptionofShareCapital.
90
Table of Contents
Leased Properties
Wemaintainthefollowingleasedfacilitiesforourcorporateheadquartersandtoconductourprincipalmanufacturingandretailactivities,whichwebelievearein
goodconditionandworkingorder:
Seasonality
Ourbusinessisseasonalinnature.SeeManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperationsFactorsAffectingPerformance
Seasonality.
91
Table of Contents
Management
Dani Reiss C. M. (Member of the Order of Canada), President and Chief Executive Officer and Director
Thegrandsonofourfounder,Mr.Reiss,joinedthecompanyin1997andwasnamedPresidentandChiefExecutiveOfficerofthecompanyin2001.Mr.Reisshas
workedinalmosteveryareaofthecompanyandsuccessfullydevelopedourinternationalsaleschannelspriortoassumingtheroleofPresidentandChief
ExecutiveOfficer.Mr.ReissreceivedaBachelorofArtsfromUniversityofToronto.Mr.Reissisthechairmanofourboardofdirectorsandbringsleadershipand
operationalexperiencetoourboardofdirectorsasourPresidentandChiefExecutiveOfficer.
92
Table of Contents
93
Table of Contents
sPafromMarch1994toFebruary1999,asSeniorVicePresident,FilaApparel.FromJune1977toApril1992,heservedasVicePresident,Sales,Marketing,
GlobalProductandvariousotherexecutiverolesatTheNorthFace.Mr.TurlingtonreceivedaBachelorofEconomicsfromLenoir-RhyneUniversity.
94
Table of Contents
95
Table of Contents
Bankruptcies
Noneofourdirectorsorexecutiveofficersis,asatthedateofthisprospectus,orhasbeen,withinthe10yearspriortothedateofthisprospectus,adirectoror
executiveofficerofanycompany(includingCanadaGoosecompanies),that,whilethatpersonwasactinginthatcapacity,orwithinayearofthatpersonceasing
toactinthatcapacity,becamebankrupt,madeaproposalunderanylegislationrelatingtobankruptcyorinsolvencyorwassubjecttoorinstitutedanyproceedings,
arrangementorcomprisewithcreditorsorhadareceiver,receivermanagerortrusteeappointedtoholditsassets,exceptforStephenGunnwhowasadirectorof
GolfTownCanadaInc.whichfiledforprotectionundertheCompanies Creditors Arrangement Act onSeptember14,2016.
themajorityindependentdirectorrequirementunderSection303A.01oftheNYSEListingRules;
therequirementunderSection303A.05oftheNYSEListingRulesthatacompensationcommitteebecomprisedsolelyofindependentdirectors;and
therequirementunderSection303A.04oftheNYSEListingRulesthatdirectornomineesbeselectedorrecommendedforselectionbyanominations
committeecomprisedsolelyofindependentdirectors.
Corporate Governance
Section310.00oftheNYSEListingRulesgenerallyrequiresthatalistedcompanysby-lawsprovideforaquorumforanymeetingoftheholdersofthecompanys
votingsharesthatissufficientlyhightoensurearepresentativevote.PursuanttotheNYSEListingRuleswe,asaforeignprivateissuer,haveelectedtocomply
withpracticesthatarepermittedunderCanadianlawinlieuoftheprovisionsofSection310.00.Ourarticlesprovidethataquorumofshareholdersshallbethe
holderswho,intheaggregateholdatleast25%oftheissuedsharesplusatleastamajorityofmultiplevotingsharesentitledtobevotedatthemeeting,irrespective
ofthenumberofpersonsactuallypresentatthemeeting.
Exceptasstatedabove,weintendtocomplywiththerulesgenerallyapplicabletoU.S.domesticcompanieslistedontheNYSE.Wemayinthefuturedecidetouse
otherforeignprivateissuerexemptionswithrespecttosomeoftheotherNYSElistingrequirements.Followingourhomecountrygovernancepractices,asopposed
totherequirementsthatwouldotherwiseapplytoacompanylistedontheNYSE,mayprovidelessprotectionthanisaccordedtoinvestorsundertheNYSElisting
requirementsapplicabletoU.S.domesticissuers.
96
Table of Contents
Certainaspectsofthecompositionandfunctioningofourboardofdirectorsmaybesubjecttotherightsofourprincipalshareholdersunderagreementswiththe
company.Forexample,inconnectionwiththisoffering,theprincipalshareholdersexpecttoenterintoaninvestorrightsagreementprovidingforcertaindirector
nominationrights.SeeCertainRelationshipsandRelatedPartyTransactionsInvestorRightsAgreement.Subjecttosuchagreements,nomineesforelectionas
directorswillberecommendedtoourboardofdirectorsbyournominatingandgovernancecommitteeinaccordancewiththeprovisionsofapplicablecorporate
lawandthecharterofournominatingandgovernancecommittee.SeeBoardCommitteesNominatingandGovernanceCommittee.
97
Table of Contents
Director Independence
Followingthecompletionofthisoffering,wewillbeacontrolledcompanyundertherulesoftheNYSEbecausemorethan50%ofthevotingpowerofour
shareswillbeheldbyBainCapital.SeePrincipalandSellingShareholders.Weintendtorelyuponthecontrolledcompanyexceptionrelatingtotheboardof
directorsandcommitteeindependencerequirementsundertheNYSEListingRules.Pursuanttothisexception,wewillbeexemptfromtherulesthatwould
otherwiserequirethatourboardofdirectorsconsistofamajorityofindependentdirectorsandthatourcompensationcommitteeandnominatingandgovernance
committeebecomposedentirelyofindependentdirectors.Thecontrolledcompanyexceptiondoesnotmodifytheindependencerequirementsfortheaudit
committee,andweintendtocomplywiththerequirementsoftheExchangeActandtherulesoftheNYSEandtheBCBCA,whichrequirethatourauditcommittee
haveamajorityofindependentdirectorsuponconsummationofthisoffering,andexclusivelyindependentdirectorswithinoneyearfollowingtheeffectivedateof
theregistrationstatementrelatingtothisoffering.
UndertheNYSEListingRules,anindependentdirectormeansapersonwho,intheopinionofourboardofdirectors,hasnomaterialrelationshipwithour
company.UnderNI58-101,adirectorisconsideredtobeindependentifheorsheisindependentwithinthemeaningofSection1.4ofNationalInstrument52-110
Audit Committees ,orNI52-110.PursuanttoNI52-110,anindependentdirectorisadirectorwhoisfreefromanydirectorindirectmaterialrelationshipwith
uswhichcould,intheviewofourboardofdirectors,bereasonablyexpectedtointerferewiththeexerciseofadirectorsindependentjudgment.
Basedoninformationprovidedbyeachdirectorconcerninghisorherbackground,employmentandaffiliations,ourboardofdirectorshasdetermined
thatMr.GunnandMr.Hut,representingtwoofthefivemembersofourboardofdirectors,areindependentasthattermisdefinedundertheNYSEListing
RulesandNI58-101.Inmakingthisdetermination,ourboardofdirectorsconsideredthecurrentandpriorrelationshipsthateachsuchnon-employeedirectorhas
withourcompanyandallotherfactsandcircumstancesourboardofdirectorsdeemedrelevantindeterminingtheirindependence.Mr.Reissisconsiderednot
independentbyreasonofthefactthatheisourPresidentandChiefExecutiveOfficer.Mr.BekensteinandMr.Cottonareconsiderednotindependentunder
NI52-110,NI58-101andtheBCBCA,byreasonoftheirrelationshipswithBainCapital.Fourofthefivemembersofourboardofdirectorsarenotmembersof
ourcompanysmanagement.
Ourcompanywilltakestepstoensurethatadequatestructuresandprocesseswillbeinplacefollowingthecompletionofthisofferingtopermitourboardof
directorstofunctionindependentlyofmanagement,includingforpurposesofencouraginganobjectiveprocessfornominatingdirectorsanddeterminingexecutive
compensation.Itiscontemplatedthattheindependentmembersofourboardofdirectorswillconsider,ontheoccasionofeachmeeting,whetheranin camera
meetingwithoutthenon-independentdirectorsandmembersofmanagementwouldbeappropriateandthattheywillholdanin camera meetingwithoutthenon-
independentdirectorsandmembersofmanagementwhereappropriate.
Membersofourboardofdirectorsarealsomembersoftheboardsofotherpubliccompanies.SeeManagementExecutiveOfficersandDirectors.Ourboardof
directorshasnotadoptedaformaldirectorinterlockpolicy,butiskeepinginformedofotherdirectorshipsheldbyitsmembers.
ThechairmanofourboarddirectorsisnotconsideredanindependentdirectorbyreasonofthefactthatheisourPresidentandChiefExecutiveOfficer.However,
followingcompletionoftheoffering,ourboardofdirectorswilltakestepsforfacilitatingtheexerciseofindependentjudgmentbytheboardofdirectors,providing
leadershipforindependentdirectorsandensuringthatthedirectorswhoareindependentofmanagementhaveopportunitiestomeetwithoutmanagementpresent,
asappropriate.
98
Table of Contents
meetingsaswellasadhocmeetingsfromtimetotime.Ourboardwilladoptaformalmandatefortheboardofdirectors.Theresponsibilitiesofourboardof
directorsuponcompletionofthisofferingwillinclude:
adoptingastrategicplanningprocess,approvingtheprincipalbusinessobjectivesforthecompanyandapprovingmajorbusinessdecisionsand
strategicinitiatives;
appointingthePresidentandChiefExecutiveOfficerofthecompanyanddevelopingthecorporategoalsandobjectivesthatthePresidentandChief
ExecutiveOfficerisresponsibleformeeting,andreviewingtheperformanceofthePresidentandChiefExecutiveOfficeragainstsuchgoalsand
objectives;
overseeingcommunicationswithshareholders,otherstakeholders,analystsandthepublic,includingtheadoptionofmeasuresforreceivingfeedback
fromstakeholders;and
monitoringtheimplementationofprocedures,policiesandinitiativesrelatingtocorporategovernance,riskmanagement,corporatesocial
responsibility,healthandsafety,ethicsandintegrity.
Ourboardofdirectorshasnotdevelopedatthistimewrittenpositiondescriptionsforthechairmanoftheboardofdirectorsorthechairpersonoftheboard
committees.Theirprimaryrolesaremanagingtheaffairsoftheboardofdirectorsorofsuchrelevantcommittee,includingensuringtheboardofdirectorsorsuch
committeeisorganizedproperly,functionseffectivelyandmeetsitsobligationsandresponsibilities.Eachcommitteechairpersonwillconducttheaffairsofthe
applicablecommitteeinaccordancewiththecharterofsuchcommittee.
OurboardofdirectorsandourChiefExecutiveOfficerhavenotdevelopedatthistimeawrittenpositiondescriptionfortheChiefExecutiveOfficerorforother
executiveofficers.TheroleoftheChiefExecutiveOfficerisdelineatedonthebasisofcustomarypractice.Theboardofdirectorsconsidersthattheroleand
responsibilitiesoftheChiefExecutiveOfficeraretodevelopthecompanysstrategicplansandpoliciesandrecommendingsuchplansandpoliciestotheboardof
directors;provideexecutiveleadership,overseeacomprehensiveoperationalplanningandbudgetingprocess,superviseday-to-daymanagement,reportrelevant
matterstotheboardofdirectors,facilitatecommunicationsbetweentheboardofdirectorsandtheseniormanagementteam,andidentifybusinessrisksand
opportunitiesandmanagethemaccordingly,andhascommunicatedthesametotheChiefExecutiveOfficer.
Thechairmanofourboardofdirectorswillberesponsibleforoverseeingdirectorcontinuingeducationdesignedtomaintainorenhancetheskillsandabilitiesof
ourdirectorsandtoensurethattheirknowledgeandunderstandingofourbusinessremainscurrent.Thechairpersonofeachcommitteewillberesponsiblefor
coordinatingorientationandcontinuingdirectordevelopmentprogramsrelatingtothecommitteesmandate.
TheCodeofConductwillsetoutourfundamentalvaluesandstandardsofbehaviorthatareexpectedfromourdirectors,officersandemployeeswithrespecttoall
aspectsofourbusiness.TheobjectiveoftheCodeof
99
Table of Contents
Conductwillbetoprovideguidelinesformaintainingourintegrity,reputationandhonestywithagoalofhonoringotherstrustinusatalltimes.TheCodeof
Conductwillsetoutguidancewithrespecttoconflictsofinterest,protectionandproperuseofcorporateassetsandopportunities,confidentialityofcorporate
information,fairdealingwiththirdparties,compliancewithlawsandreportingofanyillegalorunethicalbehaviour.
Wealsoexpecttoadoptacodeofethicsforseniormanagersandfinancialofficers,includingourChiefExecutiveOfficer,ChiefFinancialOfficer,controlleror
principalaccountingofficer,orotherpersonsperformingsimilarfunctions.
Uponthecompletionofthisoffering,thefulltextoftheCodeofConductwillbeavailableonourwebsiteatwww.canadagoose.comandourSEDARprofileat
www.sedar.com.Informationcontainedon,orthatcanbeaccessedthrough,ourwebsitedoesnotconstituteapartofthisprospectusandisnotincorporatedby
referenceherein.
Interests of Directors
Adirectorwhohasamaterialinterestinamatterbeforeourboardofdirectorsoranycommitteeonwhichheorsheservesisrequiredtodisclosesuchinterestas
soonasthedirectorbecomesawareofit.Insituationswhereadirectorhasamaterialinterestinamattertobeconsideredbyourboardofdirectorsorany
committeeonwhichheorsheserves,suchdirectormayberequiredtoexcusehimselforherselffromthemeetingwhilediscussionsandvotingwithrespecttothe
matteraretakingplace.DirectorswillalsoberequiredtocomplywiththerelevantprovisionsoftheBCBCAregardingconflictsofinterest.SeeDescriptionof
ShareCapitalCertainImportantProvisionsofOurArticlesandtheBCBCADirectors.
Diversity
Webelievethathavingadiverseboardofdirectorscanofferabreadthanddepthofperspectivesthatenhanceourperformance.Thenominatingandgovernance
committeevaluesdiversityofabilities,experience,perspective,education,gender,background,raceandnationalorigin.Recommendationsconcerningdirector
nomineesarebasedonmeritandpastperformanceaswellasexpectedcontributiontotheboardsperformanceand,accordingly,diversityistakeninto
consideration.Atclosingofthisoffering,noneofthemembersofourboardofdirectorswillbewomen.
Wesimilarlybelievethathavingadiverseandinclusiveorganizationoverallisbeneficialtooursuccess,andwearecommittedtodiversityandinclusionatall
levelsofourorganizationtoensurethatweattract,retainand
100
Table of Contents
promotethebrightestandmosttalentedindividuals.Wehaverecruitedandselectedseniormanagementcandidatesthatrepresentadiversityofbusiness
understanding,personalattributes,abilitiesandexperience.Currently,4outof13membersofourseniormanagementteamarewomen.
Wedonotcurrentlyhaveaformalpolicyfortherepresentationofwomenonourboardofdirectorsorseniormanagement.Thenominatingandgovernance
committeeandourseniormanagementteamalreadytakesgenderandotherdiversityrepresentationintoconsiderationaspartoftheiroverallrecruitmentand
selectionprocess.Wehavenotadoptedtargetsforgenderorotherdiversityrepresentationinpartduetotheneedtoconsiderabalanceofcriteriaforeach
individualappointment.
Weanticipatethatthecompositionoftheboardofdirectorswillinthefuturebeshapedbytheselectioncriteriatobedevelopedbyourboardofdirectorsand
nominatingandgovernancecommittee,ensuringthatdiversityconsiderationsaretakenintoaccountinseniormanagement,monitoringthelevelofwomen
representationontheboardandinseniormanagementpositions,continuingtobroadenrecruitingeffortstoattractandinterviewqualifiedfemalecandidates,and
committingtoretentionandtrainingtoensurethatourmosttalentedemployeesarepromotedfromwithinourorganization,allaspartofouroverallrecruitment
andselectionprocesstofillboardorseniormanagementpositionsastheneedarisesandsubjecttotherightsofourprincipalshareholdersunderagreementswith
thecompany.
Board Committees
Uponthecompletionofthisoffering,ourboardofdirectorswillhavethreestandingcommittees:theauditcommittee;thecompensationcommittee;andthe
nominatingandgovernancecommittee.Eachofthecommitteesoperatesunderitsownwrittencharteradoptedbyourboardofdirectors,eachofwhichwillbe
availableonourwebsiteuponclosingofthisoffering.
Audit Committee
Followingthisoffering,ourauditcommitteewillbecomposedofMr.Cotton,Mr.GunnandMr.HutwithMr.Gunnservingaschairpersonofthecommittee.Our
boardofdirectorshasdeterminedthatMr.GunnandMr.HutmeettheindependencerequirementsundertherulesoftheNYSE,theBCBCAandunderRule10A-
3oftheExchangeAct.Withinoneyearfollowingtheeffectivedateoftheregistrationstatementrelatingtothisoffering,ourauditcommitteewillconsist
exclusivelyofindependentdirectors.OurboardofdirectorshasdeterminedthatMr.Gunnisanauditcommitteefinancialexpertwithinthemeaningofthe
SECsregulationsandapplicableListingRulesoftheNYSE.WewillcomplywithNI52-110andintendtorelyontheexemptionsforU.S.listedissuers
thereunder.Theauditcommitteesresponsibilitiesuponcompletionofthisofferingwillinclude:
appointing,compensating,retainingandoverseeingtheworkofanyregisteredpublicaccountingfirmengagedforthepurposeofpreparingorissuing
anauditreportorperformingotheraudit,revieworattestservicesandreviewingandappraisingtheauditeffortsofourindependentaccountants;
pre-approvingauditandpermissiblenon-auditservices,andthetermsofsuchservices,tobeprovidedbyourindependentregisteredpublicaccounting
firm;
establishingproceduresfor(i)thereceipt,retentionandtreatmentofcomplaintsregardingaccounting,internalaccountingcontrolsorauditingmatters
and(ii)confidentialandanonymoussubmissionsbyouremployeesofconcernsregardingquestionableaccountingorauditingmatters;
engagingindependentcounselandotheradvisers,asnecessaryanddeterminingfundingofvariousservicesprovidedbyaccountantsoradvisers
retainedbythecommittee;
reviewingourfinancialreportingprocessesandinternalcontrols;
establishing,overseeinganddealingwithissuesrelatedtothecompanyscodeofethicsformanagersandfinancialofficers;
101
Table of Contents
reviewingandapprovingrelated-partytransactionsorrecommendingrelated-partytransactionsforreviewbyindependentmembersofourboardof
directors;and
providinganopenavenueofcommunicationamongtheindependentaccountants,financialandseniormanagementandtheboard.
Compensation Committee
Followingthisoffering,ourcompensationcommitteewillbecomposedofMr.BekensteinandMr.Cotton,withMr.Bekensteinservingaschairpersonofthe
committee.Itsprimarypurpose,withrespecttocompensation,willbetoassistourboardofdirectorsinfulfillingitsoversightresponsibilitiesandtomake
recommendationstoourboardofdirectorswithrespecttothecompensationofourdirectorsandexecutiveofficers.Theprincipalresponsibilitiesanddutiesofthe
compensationcommitteeinclude:
evaluatingourPresidentandChiefExecutiveOfficersandotherexecutiveofficersperformanceinlightofthegoalsandobjectivesestablishedby
ourboardofdirectorsand,basedonsuchevaluation,withappropriateinputfromotherindependentmembersofourboardofdirectors,determining
thePresidentandChiefExecutiveOfficersandotherexecutiveofficerscompensation;
administeringourequity-basedplansandmanagementincentivecompensationplansandmakingrecommendationstoourboardofdirectorsabout
amendmentstosuchplansandtheadoptionofanynewemployeeincentivecompensationplans;and
engagingindependentcounselandotheradvisers,asnecessaryanddeterminingfundingofvariousservicesprovidedbyaccountantsoradvisers
retainedbythecommittee.
developingandrecommendingtotheboardofdirectorscriteriaforboardandcommitteemembership;
recommendingtotheboardofdirectorsthepersonstobenominatedforelectionasdirectorsandtoeachofthecommitteesoftheboardofdirectors;
assessingtheindependenceofdirectorswithinthemeaningofsecuritieslawsandstockexchangerulesasapplicable;
consideringresignationsbydirectorssubmittedpursuanttoourmajorityvotingpolicy,andmakingrecommendationstoourboardofdirectorsasto
whetherornottoacceptsuchresignations;
reviewingandmakingrecommendationstotheboardofdirectorsinrespectofourcorporategovernanceprinciples;
providingfornewdirectororientationandcontinuingeducationforexistingdirectorsonaperiodicbasis;
performinganevaluationoftheperformanceofthecommittee;and
overseeingtheevaluationoftheboardofdirectorsanditscommittees.
102
Table of Contents
Executive Compensation
Overview
ThefollowingtablesanddiscussionrelatetothecompensationpaidtoorearnedbyourPresidentandChiefExecutiveOfficer,DaniReiss,andourtwomosthighly
compensatedexecutiveofficers(otherthanMr.Reiss)whowereservingasexecutiveofficersonthelastdayoffiscal2016.TheyareScottCameron,whoservesas
ourExecutiveVicePresident,E-commerce,StoresandStrategy,andPaulRiddlestone,ourformerChiefOperatingOfficer.Messrs.Reiss,Cameron,and
Riddlestonearereferredtocollectivelyinthisprospectusasournamedexecutiveofficers.
Non-equity
Option incentive plan All other
Salary Bonus awards compensation compensation Total
Name and principal position Year ($) (1) ($) ($) (2) ($) ($) (3) ($)
DaniReiss,C.M. 2016 1,020,150 150,000(4) 600,000(5) 421 1,770,571
President & Chief Executive Officer
ScottCameron 2016 79,327 137,500(6) 396,165 2,902 615,894
EVP, E-commerce, Stores & Strategy
PaulRiddlestone(7) 2016 273,946 87,696(8) 421 362,063
Former Chief Operating Officer
(1) AmountshownforMr.ReissincludessalarypaidtohimasourPresidentandChiefExecutiveOfficer($1,000,000)andfeespaidinconnectionwithhis
serviceontheboardofCanadaGooseInternationalAG,awholly-ownedsubsidiaryoftheCompany(aggregateof$20,150).Amountshownforboardfeesis
inCanadiandollars,butwaspaidtoMr.ReissinthreeequalpaymentsinSwissFrancs(CHF)andtheexchangeratewascalculatedbasedonthedailynoon
exchangerateoneachofFebruary25,2016,July25,2016andDecember23,2016;ofC$1.00=CHF0.73,C$1.00=CHF0.75andC$1.00=CHF0.76,
respectively,aspublishedbytheBankofCanada.AmountshownforMr.CameronincludescontributionsbyhimtotheGroupRetirementSavingsPlanfor
theEmployeesofCanadaGooseInc.(referredtoastheRSPanddescribedbelow).Messrs.ReissandRiddlestonedidnotcontributetotheRSPinfiscal
2016.
(2) AmountshownreflectsthegrantdatefairvalueofoptionstopurchaseClassBCommonSharesandClassAJuniorPreferredShares,grantedtoMr.
Cameroninfiscal2016.ThevaluewasdeterminedinaccordancewithIFRS2.
(3) AmountsshowninthiscolumnincludeCompany-paidlifeinsurancepremiumsof$421,$90and$421paidonbehalfofMessrs.Reiss,Cameronand
Riddlestone,respectively,and,forMr.Cameron,Companycontributionsof$2,812underourDeferredProfitSharingPlanfortheEmployeesofCanada
GooseInc.(referredtoastheDPSPanddescribedbelow).
(4) AmountshownreflectstheportionofMr.Reisssannualbonusearnedwithrespecttofiscal2016thatwasbasedontheachievementofindividual
performancegoals.
(5) AmountshownreflectstheportionofMr.Reisssannualbonusearnedwithrespecttofiscal2016thatwasbasedontheachievementofEBITDAgoals.
(6) Amountshownrepresentsacashsign-onbonusof$100,000paidtoMr.CameroninconnectionwithhiscommencementofemploymentwithusandMr.
Cameronsannualbonusof$37,500earnedwithrespecttofiscal2016.
(7) Mr.RiddlestonesemploymentwiththecompanyterminatedonJanuary10,2017.
(8) AmountshownrepresentsMr.Riddlestonesannualbonusearnedwithrespecttofiscal2016.
103
Table of Contents
2016 Bonuses
Eachnamedexecutiveofficeris(orwas,inMr.Riddlestonescase)eligibletoreceiveanannualbonuspursuanttohisemploymentagreement,asdescribedbelow
underAgreementswithourNamedExecutiveOfficers.Theannualbonusamountsearnedbyournamedexecutiveofficersforfiscal2016areshowninthe
SummaryCompensationTableabove.
Forfiscal2016,Mr.Reisswaseligibletoearnatargetannualbonusequalto$750,000,basedontheachievementofpre-establishedfiscal2016EBITDAtargets,
weightedat80%ofhisbonus,andindividualperformancecriteria,weightedat20%ofhisbonus.TargetEBITDAwasapprovedbyourboardofdirectorsatthe
beginningoffiscal2016inconnectionwiththeannualbudgetingprocess,withtargetEBITDAsetat$55.59millionandpayoutoftheEBITDAcomponentofMr.
Reisssbonusbeingearnedat100%uponachievementofEBITDAwithinarangeof95%to105%oftarget.NoportionoftheEBITDAcomponentofMr.Reisss
bonuswouldbeearnedifEBITDAwereachievedat80%orlessbelowtarget.AchievementofEBITDAbetween80%oftargetandlessthan95%oftargetwould
resultintheEBITDAcomponentofMr.Reisssbonusbeingearnedonastraight-linebasisbetween0%and100%.AchievementofEBITDAabove105%oftarget
wouldresultintheEBITDAcomponentofMr.Reisssbonusbeingearnedonastraight-linebasisbetween100%and200%,with135%oftargetastheupper
bound.TheindividualperformancecriteriaforMr.Reissforfiscal2016includedleadershipandeffectivenessgoalsdeterminedbyourboardofdirectors.
Mr.Reissearnedafiscal2016bonusequalto100%ofhistargetannualbonus,basedonthedeterminationbyourboardofdirectorsthatEBITDA,asadjusted,was
deemedachievedat100%oftargetandthatMr.Reissalsoachievedhisleadershipandeffectivenessgoalsat100%oftarget.
Messrs.CameronandRiddlestonewereeligibletoearnannualbonusesforfiscal2016underabroad-basedannualbonusplanforsalariedemployeestargetedat
40%oftheirbasesalaries,respectively,withMr.Cameronsbonuspro-ratedtoreflectonequarterofservice.Bonusescouldbeearnedundertheplanbasedonthe
achievementofpre-establishedEBITDAtargetsandaparticipantsindividualperformancereviewforfiscal2016.TargetEBITDAforpurposesofourfiscal2016
annualbonusplanwasdefinedthesameasaboveforMr.Reiss,withtargetEBITDAalsosetat$55.59million.Nobonuseswerepayableundertheplanfor
achievementofEBITDAatlessthan80%oftargetoranindividualperformanceratingofneedsimmediateimprovement.UponachievementofEBITDAofat
least80%oftarget,aparticipantcouldreceiveanannualbonusofbetween0%and160%ofhisorhertargetedbonus,dependingonanindividualperformance
ratingofexceptional,tracking,leading,orinconsistent,withrangesofbonusesasapercentageoftargeteligibletobeearnedateachperformancerating.
Messrs.CameronandRiddlestoneearnedfiscal2016bonusesequalto100%and80%oftheirtargetedannualbonuses,respectively.Fiscal2016bonuseswerepaid
toMessrs.Reiss,CameronandRiddlestoneonJune24,2016.
Equity-Based Compensation
Mr.Cameronwasouronlynamedexecutiveofficergrantedanequityawardinfiscal2016.Inconnectionwithhiscommencementofemploymentwithusin
January2016,Mr.CameronwasgrantedoptionstopurchaseClassBCommonSharesandClassAJuniorPreferredShares.Infiscal2015,Mr.Riddlestonewas
grantedoptionstopurchaseClassBCommonSharesandClassAJuniorPreferredShares.One-thirdofeachofMessrs.Camerons
104
Table of Contents
andRiddlestonesawardsis(orwasinMr.Riddlestonescase)subjecttotime-basedvesting,andtwo-thirdsisorwas,asapplicable,subjecttotime-basedand
performance-basedvesting,withtheperformance-basedcomponenttiedtotheachievementbyBainCapitalofcertainreturnsonitsinvestmentinCanadaGoose.
Inconnectionwiththisoffering,weexpectanaggregateofapproximately673,000performance-basedoptionstovest,includingcertainoftheperformance-based
optionsheldbyourexecutiveofficers.Thetime-basedvestingoptionsandthetime-vestingcomponentoftheoptionssubjecttotime-basedandperformance-based
vestingheldbyMessrs.CameronandRiddlestonewillaccelerate(orwouldhaveacceleratedinMr.Riddlestonescase)infulluponachangeofcontrol,subjectto
theircontinuedemploymentthroughsuchdate.
Employee Benefits
Ourfull-timeemployees,includingournamedexecutiveofficers,areeligibletoparticipateinourhealthandwelfarebenefitplans,whichincludemedical,dental,
vision,basicanddependentlife,supplementallife,accidentaldeath,dismembermentandspecificloss,long-termdisability,andoptionalcriticalillnessinsurance.
Employeesarealsoeligibletoreceivecontinuingeducationsupportandtoparticipateinouremployeepurchaseprogram,whichallowsemployeestopurchasea
specifiednumberofjacketsandaccessoriesat50%ofthemanufacturerssuggestedretailprice.Ournamedexecutiveofficersparticipateintheseplansona
slightlybetterbasisthanothersalariedemployees,includinginsomeinstanceswithslightlylowerdeductibles,bettercost-sharingratesandtheabilitytopurchase
Medcanhealthcoverage.Ournamedexecutiveofficersarealsoentitledtothreecomplimentaryjacketseachcalendaryear.
Retirement Plans
Infiscal2016,Messrs.CameronandRiddlestonewereeligibletoparticipateintheRSP,abroad-basedregistereddefinedcontributionplanofferedtoallofour
full-timeCanada-basedemployeesotherthanMr.Reiss.SalariedemployeesinToronto(includingMessrs.CameronandRiddlestone,butnotMr.Reiss)maydefer
upto3%oftheirannualearningsintotheRSPandmaymakeadditionalvoluntarycontributions.Wewillmatchanysuchemployeecontributionsbymakinga
contributiontotheDPSP,abroad-baseddefinedcontributionplanofferedtoallofourfull-time,salariedemployees.Thematchisequalto100%oftherequired
participantcontributionsmadeintotheplanupto3%oftheparticipantsannualbasesalary.Wedonotsponsorormaintainanyqualifiedornon-qualifieddefined
benefitplansorsupplementalexecutiveretirementplans.
Underhisemploymentagreement,effectiveJanuary4,2016,Mr.Cameronisentitledtoanannualbasesalaryof$375,000,subjecttoannualreview.Mr.Cameron
isalsoeligibletoparticipateinourannualbonusplan,withanannualincentivebonustargetedat40%ofhisannualbasesalaryandpotentialpayoutsrangingfrom
0%to160%ofhistargetedannualbonus.Mr.Cameronreceivedacashsign-onbonusof$100,000inconnectionwithhishire.
Underhisemploymentagreement,effectiveOctober21,2010andwhichterminatedinconnectionwiththeterminationofhisemploymentonJanuary10,2017,
Mr.Riddlestonewasentitledtoanannualbasesalaryof$190,000,subjecttobi-annualreview.Pursuanttohisemploymentagreement,Mr.Riddlestonewasalso
eligibletoparticipateinourannualbonusplan,withanannualincentivebonustargetedat15%ofhisannualbasesalaryandanadditional5%ofannualbasesalary
basedonachievementofourgrossmargingoals.
105
Table of Contents
Messrs.ReissandCameroncontinuetohaveanannualbasesalaryandtargetannualincentivebonusatthesamelevelasspecifiedintheiremployment
agreements,whileMr.Riddlestonesannualbasesalaryhadsinceincreasedto$280,000andhistargetannualincentivebonushadsinceincreasedto40%ofhis
annualbasesalary.
Severance
IfMr.Reisssemploymentwereterminatedbyuswithoutcauseorheresignedforgoodreason,hewouldbeentitledto(i)aseveranceamountrepresentingtwo
timesMr.ReisssannualbasesalaryplustwotimestheaverageamountoftheannualbonusearnedbyMr.Reissinthetwocompletefiscalyearsprecedingthe
dateofhisterminationofemployment,(ii)aproratabonusamountfortheyearinwhichtheterminationoccurs,basedontheactualbonusamountpaidintheprior
yearand(iii)continuedparticipationinourbenefitplansforaperiodof24monthsfollowingthedateofterminationofemployment.
IfMr.Cameronsemploymentwereterminatedbyuswithoutcause,hewouldbeentitledtonoticeorpayinlieuofnoticeandbenefitscontinuanceequaltotwo
weeksnoticeplusanadditionalfourweeksperyearofcompletedservice,uptoamaximumof52weeks.
Mr.Riddlestonesemploymentagreementprovidedthatwemayterminatehisemploymentwithoutcausebyprovidingnoticeorpayinlieuofnoticeandbenefits
continuanceinaccordancewiththeprovisionsofapplicableemploymentstandardslegislation.InconnectionwithMr.Riddlestonesdeparture,weterminatedhis
employmentagreementandenteredintoanewsettlementagreement.TheTerminationLetterandtheSettlementAgreementarefiledasexhibits10.23and10.24to
theregistrationstatementrelatingtothisoffering.Inaddition,theportionofhisoptionssubjecttotime-basedvestingthatwerevestedasoftheterminationdate
willremainoutstandingandexercisableupontheearlierof(i)15monthsafterthedateofhisterminationofemploymentand(ii)theterminationofalllock-up
periodsapplicabletoanyshareholdersorotherbeneficialownersofoursecuritiesinconnectionwiththisoffering.
Restrictive Covenants
Underhisemploymentagreement,Mr.Reississubjecttonon-competitionobligationsduringandforoneyearfollowinghisterminationofemployment,
restrictionsonsolicitingourcustomers,prospectivecustomers,employeesorconsultantsduringandfortwoyearsfollowinghisterminationofemployment,as
wellasintellectualpropertyassignmentandconfidentialityobligations.
Undertheiremploymentagreements,Messrs.CameronandRiddlestonearesubjecttonon-competitionobligationsduringandforoneyearfollowingtheir
terminationofemployment,restrictionsonsolicitingourcustomersoremployeesforoneyearfollowingtheirterminationofemployment,intellectualproperty
assignmentobligationsduringandforoneyearfollowingtheirterminationofemployment,andconfidentialityobligations.
Inaddition,asaconditiontoreceivingtheirCanadaGooseHoldingsInc.optionawards,Messrs.CameronandRiddlestoneenteredintorestrictivecovenant
agreementsbindingthemtonon-competitionobligationswithrespecttoourbusinessbeginningonthefirstdateonwhichanyoptionsgrantedpursuanttothe
awardvestandcontinuingfor12monthsfollowingtheirterminationofemployment,restrictionsonsolicitingcustomers,prospectivecustomers,employeesand
independentcontractorsbeginningonthefirstdateonwhichanyoptionsgrantedpursuanttotheawardvestandcontinuingfor24monthsfollowingtheir
terminationofemployment,aswellasconfidentialityobligationsduringandaftertheiremploymentwithus.
106
Table of Contents
OPTION AWARDS
Equity
incentive
plan
awards:
Number of Number of Number of
securities securities securities
underlying underlying underlying Option
unexercised unexercised unexercised exercise Option
options (#) options (#) unearned price expiration
Name exercisable unexercisable options (#) ($) date
DaniReiss
ScottCameron(1) 280,968 561,939 3.55 1/4/2026
PaulRiddlestone(2) 182,770 274,155 913,853 1.00 4/17/2024
(1) Mr.Cameronwasgranted337,162optionstopurchaseClassBCommonSharesand505,745optionstopurchaseClassAJuniorPreferredSharesonJanuary
4,2016.Onethirdofhisoptionsaresubjecttotime-basedvestingof40%onthesecondanniversaryofthegrantdateand20%oneachanniversaryofthe
grantdatethereafter(CameronTime-BasedOptions).Theremainingtwo-thirdsofhisoptionsaresubjecttobothtime-basedandperformance-basedvesting
withtheperformancemetricsreflectingamultipleofBainCapitalsreturnonitsinvestmentinus(CameronPerformance-BasedOptions).TheCameron
Performance-BasedOptionsaresubjecttothesametime-basedvestingscheduleastheCameronTime-BasedOptions.TheCameronTime-BasedOptions
andthetime-vestingcomponentoftheCameronPerformance-BasedOptionswillaccelerateinfulluponachangeofcontrol.
(2) Mr.Riddlestonewasgranted548,311optionstopurchaseClassBCommonSharesand822,467optionstopurchaseClassAJuniorPreferredShareson
April17,2014.Onethirdofhisoptionsweresubjecttotime-basedvestingof40%onDecember9,2015and20%oneachDecember9ththereafter
(RiddlestoneTime-BasedOptions).Theremainingtwo-thirdsofhisoptionsweresubjecttobothtime-basedandperformance-basedvestingwiththe
performancemetricsreflectingamultipleofBainCapitalsreturnonitsinvestmentinus(RiddlestonePerformance-BasedOptions).TheRiddlestone
Performance-BasedOptionsweresubjecttothesametime-basedvestingscheduleastheRiddlestoneTime-BasedOptions.TheRiddlestoneTime-Based
Optionsandthetime-vestingcomponentoftheRiddlestonePerformance-BasedOptionswouldhaveacceleratedinfulluponachangeofcontrol.Treatment
ofMr.RiddlestonesoptionsinconnectionwiththeterminationofhisemploymentisdescribedaboveunderAgreementswithourNamedExecutive
OfficersSeverance.
Director Compensation
OtherthanMr.Reiss,whosecompensationisincludedwiththatofourothernamedexecutiveofficers,noneofourdirectorsreceivedanycompensationfortheir
servicesduringfiscal2016.
107
Table of Contents
Ourboardofdirectors,initssolediscretion,shallfromtimetotimedesignatethedirectors,executiveofficers,employeesorconsultantstowhomawardsshallbe
grantedanddetermine,ifapplicable,thenumberofsubordinatevotingsharestobecoveredbysuchawardsandthetermsandconditionsofsuchawards.The
numberofsubordinatevotingsharesreservedforissuanceundertheOmnibusIncentivePlanwillbeequalto4,600,340subordinatevotingsharesandthenumber
ofsubordinatevotingsharesreservedforissuanceundertheLegacyOptionPlanwillbeequalto5,899,660subordinatevotingshares(representinginaggregate
10,500,000subordinatevotingsharesorapproximately10%oftheissuedandoutstandingsubordinatevotingsharesandmultiplevotingsharesasoftheclosingof
thisofferingassumingnoexerciseoftheunderwritersover-allotmentoption).Subordinatevotingsharesunderlyingoptionsterminated,surrenderedorcancelled
undertheLegacyOptionPlanwillbecomeavailableforissuanceundertheOmnibusIncentivePlan.Ifanoutstandingawardexpiresoristerminated,surrendered
orcancelledforanyreasonwithouthavingbeenexercisedorsettledinfull,orifsubordinatevotingsharesacquiredpursuanttoanawardsubjecttoforfeitureare
forfeited,thesubordinatevotingsharescoveredbysuchaward,ifany,willagainbeavailableforissuanceundertheOmnibusIncentivePlan.Subordinatevoting
shareswillnotbedeemedtohavebeenissuedpursuanttotheOmnibusIncentivePlanwithrespecttoanyportionofanawardthatissettledincash.
Options. AlloptionsgrantedundertheOmnibusIncentivePlanwillhaveanexercisepricedeterminedandapprovedbyourboardofdirectorsatthetimeofgrant,
whichshallnotbelessthanthemarketpriceofthesubordinatevotingsharesonthedateofthegrant.ForpurposesoftheOmnibusIncentivePlan,themarketprice
ofthesubordinatevotingsharesasatagivendateshallbethevolumeweightedaveragetradingpriceontheTSXforthefivetradingdaysbeforesuchdate.
Subjecttoanyvestingconditions,anoptionshallbeexercisableduringaperiodestablishedbyourboardofdirectorswhichshallnotbemorethantenyearsfrom
thegrantdateoftheoption.TheOmnibusIncentivePlan
108
Table of Contents
willprovidethattheexerciseperiodshallautomaticallybeextendedifthedateonwhichitisscheduledtoterminateshallfallduringablackoutperiod.Insuch
cases,theextendedexerciseperiodshallterminatetenbusinessdaysafterthelastdayoftheblackoutperiod.
Totheextentconsistentwiththerequirementsforsatisfyingtheperformance-basedcompensationexceptionunderSection162(m),ourboardofdirectors(ora
committeeoftheboardthatmeetscertainrequirementsofSection162(m))mayprovideinthecaseofanyawardintendedtoqualifyforsuchexceptionthatoneor
moreoftheperformanceobjectivesapplicabletoanawardwillbeadjustedinanobjectivelydeterminablemannertoreflectevents(forexample,theimpactof
chargesforrestructurings,discontinuedoperations,mergers,
109
Table of Contents
acquisitions,extraordinaryitems,andotherunusualornon-recurringitems,andthecumulativeeffectsoftaxoraccountingchanges,eachasdefinedbygenerally
acceptedaccountingprinciples)occurringduringtheperformanceperiodofsuchawardthataffecttheapplicableperformanceobjectives.
Adjustments. Intheeventofanysubdivision,consolidation,reclassification,reorganizationoranyotherchangeaffectingthesubordinatevotingshares,orany
mergeroramalgamationwithorintoanothercorporation,oranydistributiontoallsecurityholdersofcash,evidencesofindebtednessorotherassetsnotinthe
ordinarycourse,oranytransactionorchangehavingasimilareffect,ourboardofdirectorsshallinitssolediscretion,subjecttotherequiredapprovalofanystock
exchange,determinetheappropriateadjustmentsorsubstitutionstobemadeinsuchcircumstancesinordertomaintaintheeconomicrightsoftheparticipantsin
respectofawardsundertheOmnibusIncentivePlan,including,withoutlimitation,adjustmentstotheexerciseprice,thenumberandkindofsecuritiessubjectto
unexercisedawardsgrantedpriortosuchchangeand/orpermittingtheimmediateexerciseofanyoutstandingawardsthatarenototherwiseexercisable.
anyamendmenttothevestingprovisions,ifapplicable,orassignabilityprovisionsofawards;
anyamendmenttotheexpirationdateofanawardthatdoesnotextendthetermsoftheawardpasttheoriginaldateofexpirationforsuchaward;
anyamendmentregardingtheeffectofterminationofaparticipantsemploymentorengagement;
anyamendmentwhichacceleratesthedateonwhichanyoptionorshareappreciationrightmaybeexercisedundertheOmnibusIncentivePlan;
anyamendmenttothedefinitionofaneligiblepersonundertheOmnibusIncentivePlan;
anyamendmentnecessarytocomplywithapplicablelawortherequirementsoftheNYSE,theTSXoranyotherregulatorybody;
110
Table of Contents
anyamendmentofahousekeepingnature,including,withoutlimitation,toclarifythemeaningofanexistingprovisionofOmnibusIncentivePlan,
correctorsupplementanyprovisionoftheOmnibusIncentivePlanthatisinconsistentwithanyotherprovisionoftheOmnibusIncentivePlan,correct
anygrammaticalortypographicalerrorsoramendthedefinitionsintheOmnibusIncentivePlan;
anyamendmentregardingtheadministrationoftheOmnibusIncentivePlan;
anyamendmenttoaddoramendprovisionspermittingforthegrantingofcash-settledawards,aformoffinancialassistanceorclawback;and
anyotheramendmentthatdoesnotrequiretheapprovaloftheholdersofsubordinatevotingsharespursuanttotheamendmentprovisionsofthe
OmnibusIncentivePlan.
Forgreatercertainty,ourboardofdirectorsshallberequiredtoobtainshareholderapprovaltomakethefollowingamendments:
anyincreaseinthemaximumnumberofsubordinatevotingsharesthatmaybeissuablepursuanttotheOmnibusIncentivePlan;
exceptforadjustmentspermittedbytheOmnibusIncentivePlan,anyreductionintheexercisepriceofanoptionorshareappreciationrightorany
cancellationofanoptionorshareappreciationrightandreplacementofsuchoptionorshareappreciationrightwithanoptionorshareappreciation
rightwithalowerexerciseprice,totheextentsuchreductionorreplacementbenefitsaninsider;
anyextensionofthetermofanawardbeyonditsoriginalexpirytimetotheextentsuchamendmentbenefitsaninsider;
anyincreaseinthemaximumnumberofsubordinatevotingsharesthatmaybeissuabletoinsiderspursuanttotheinsiderparticipationlimit;and
anyamendmenttotheamendmentprovisionsoftheOmnibusIncentivePlan.
Exceptasspecificallyprovidedinanawardagreementapprovedbyourboardofdirectors,awardsgrantedundertheOmnibusIncentivePlanaregenerallynot
transferableotherthanbywillorthelawsofdescentanddistribution.
WecurrentlydonotprovideanyfinancialassistancetoparticipantsundertheOmnibusIncentivePlan.
TheLegacyOptionPlanallowsforthegrantofoptionstoourdirectors,officersandfull-timeandpart-timeemployeesandthoseofouraffiliates.Ourboardof
directorsisresponsibleforadministeringtheLegacyOptionPlanandhasthesoleandcompleteauthority,initssolediscretion,todeterminetheindividualsto
whomoptionsmaybegrantedandtograntoptionsinsuchamountsand,subjecttotheprovisionsoftheplan,onsuchtermsandconditionsasitdetermines
including:(i)thetimeortimesatwhichoptionsmaybegranted,(ii)theexerciseprice,(iii)thetimeortimeswheneachoptionvestsandbecomesexercisableand
thedurationoftheexerciseperiod(providedhoweverthattheexerciseperiodmaynotexceed10years),(iv)whetherrestrictionsorlimitationsaretobeimposed
onthesharesunderlyingoptionsandthenatureofsuchrestrictionsorlimitationsand(v)anyaccelerationofexercisabilityorwaiverofterminationregardingany
option.
111
Table of Contents
PursuanttotheLegacyOptionPlan,theaggregatenumberofsharesthatmaybeissuedpursuanttotheexerciseofoptionscannotrepresentmorethan5,899,660
subordinatevotingshares,whichisequaltothenumberofsubordinatevotingsharesunderlyingoutstandingoptionsundertheLegacyOptionPlanasofthedateof
amendment.Followingcompletionofthisoffering,thesubordinatevotingsharesissuableuponexerciseofsuchoptionswillrepresent,intheaggregate,
approximately6%oftheaggregatenumberofsubordinatevotingsharesandmultiplevotingsharesissuedandoutstandinguponcompletionofthisoffering
(assumingnoexerciseoftheunderwritersover-allotmentoption).
AnoptiongrantedundertheLegacyOptionPlanisexercisablenolaterthantenyearsafterthedateofgrant.Inordertofacilitatethepaymentoftheexerciseprice
oftheoptions,theLegacyOptionPlanallowsfortheparticipanttosurrenderoptionsinordertonetexercise,subjecttotheproceduressetoutintheLegacy
OptionPlan,includingtheconsentofourboardofdirectors.
Recapitalization. AsaresultoftheRecapitalization,alloftheoutstandingoptionsundertheLegacyOptionPlanbecameoptionstoacquireClassACommon
Sharesthereunder.AsofMarch1,2017,optionstoacquireatotalof5,899,660ClassACommonSharesareoutstandingundertheLegacyOptionPlan.
Inconnectionwiththisoffering,theLegacyOptionPlanwasamendedandrestatedto,amongotherthings,includetermsandconditionsrequiredbytheTSXfora
stockoptionplanandtomirrorthetermsoftheOmnibusIncentivePlansummarizedaboveunderOmnibusIncentivePlantotheextentapplicabletoa
legacystockoptionplanundersimilarcircumstances.ForadditionalinformationrelatingtooptionsoutstandingundertheLegacyOptionPlan,seeDescription
ofShareCapitalOptionstoPurchaseSecurities.
112
Table of Contents
Unlessotherwisedeterminedbyourboardofdirectors,participationintheESPPwillbeopentoemployeesofCanadaGooseinCanadaandtheUnitedStateswho
arecustomarilyemployedforatleast20hoursperweekandmorethanfivemonthsinanycalendaryear.WecurrentlyintendtoallowparticipationintheESPP
onlybyemployeeswhoarenotemployedinadirector-levelcapacityormoreseniorcapacity.ParticipationintheESPPwillbevoluntary.Eligibleemployeeswill
beabletocontributeupto10%oftheirgrossbaseearningsforpurchasesundertheESPPandwewillmatchuptoonehalfofthecontributionsmadebysuch
employees.
Atouroption,subordinatevotingsharespurchasedundertheESPPwillbeissuedfromtreasuryatthemarketpriceofthesubordinatevotingsharesonsuchdateor
acquiredthroughopenmarketpurchases,ineachcaseinaccordancewithallapplicablelawsandthetermsandconditionsoftheESPP.Forthepurposesofthe
ESPP,themarketpriceofthesubordinatevotingsharesasatagivendateshallbetheclosingpriceonTSXortheNYSE,dependingonthecurrencyinwhichthe
employeescompensationispaid,onthetradingdayprecedingsuchdate.ThenumberofsubordinatevotingsharesreservedforissuanceundertheESPPwillbe
equalto500,000subordinatevotingshares(representinglessthan1%oftheissuedandoutstandingsubordinatevotingsharesandmultiplevotingsharesasofthe
closingofthisofferingassumingnoexerciseoftheunderwritersover-allotmentoption).UndertheESPP,subordinatevotingsharesacquiredbyeligible
employeeswillberequiredtobeheldforaperiodofoneyear.
TheESPPwillbeadministeredbyourboardofdirectors,whichmaydelegateitsauthoritythereunderascontemplatedbytheESPP.Ourboardofdirectorswill
havetheauthority,inthecaseofspecialdividendsordistributions,specifiedreorganizationsandothertransactions,todetermineappropriateequitableadjustments,
ifany,tobemadeundertheESPP,includingadjustmentstothenumberofsubordinatevotingshareswhichhavebeenauthorizedforissuanceundertheESPP.Our
boardofdirectorswillhavetherighttoamend,suspendorterminatetheESPP,inwholeorinpart,atanytime,subjecttoapplicablelawsandrequirementsofany
stockexchangeorgovernmentalorregulatorybody(includinganyrequirementforshareholderapproval).Subjecttocertainexceptions,ourboardofdirectorswill
beentitledtomakeamendmentstotheESPPwithoutshareholderapproval.
113
Table of Contents
Thefollowingisasummaryofcertainregistrationrightsandnominationrightsofourprincipalshareholders(includingtheirpermittedaffiliatesandtransferees)
undertheInvestorRightsAgreement,whichsummaryisnotintendedtobecomplete.Thefollowingdiscussionisqualifiedinitsentiretybythefulltextofthe
InvestorRightsAgreement.
Registration Rights
PursuanttotheInvestorRightsAgreement,BainCapitalwillbeentitledtocertaindemandregistrationrightswhichwillenableittorequireustofilearegistration
statementand/oraCanadianprospectusandotherwiseassistwithpublicofferingsofsubordinatevotingshares(includingsubordinatevotingsharesissuableupon
conversionofmultiplevotingshares)undertheSecuritiesActandapplicableCanadiansecuritieslaws,inaccordancewiththetermsandconditionsoftheInvestor
RightsAgreement.DTRLLCwillbeentitledtosimilardemandregistrationrightsatsuchtimeasBainCapitalnolongerholdssecuritiessubjecttoregistration
rights,aswellascertainincidentalregistrationrightsinconnectionwithdemandregistrationsinitiatedbyBainCapital,andBainCapitalandDTRLLCwillbe
entitledtocertainpiggy-backregistrationrightsintheeventthatweproposetoregistersecuritiesaspartofapublicoffering.
Wewillbeentitledtopostponeorsuspendaregistrationrequestforaperiodofupto60daysduringany12-monthperiodwheresuchregistrationrequestwould
requireustomakeanyadversedisclosure.Inaddition,inconnectionwithanunderwrittenoffering,thenumberofsecuritiestoberegisteredthereundermaybe
limited,formarketingreasons,basedontheopinionofthemanagingunderwriterorunderwritersforsuchoffering.
Allcostsandexpensesassociatedwithanydemandregistrationorpiggy-backregistrationwillbebornebyusotherthanunderwritingdiscounts,commissions
andtransfertaxes,ifany,attributabletothesaleofthesubordinatevotingshares(includingfollowingtheconversionofmultiplevotingshares)bytheapplicable
sellingshareholder.WewillalsoberequiredtoprovideindemnificationandcontributionforthebenefitofBainCapitalandDTRLLCandtheirrespective
affiliatesandrepresentativesinconnectionwithanydemandregistrationorpiggy-backregistration.
Asaresultofthelock-uprestrictionsdescribedunderSharesEligibleforFutureSaleLock-upRestrictions,thedemandandincidentalregistrationrights
grantedpursuanttotheInvestorRightsAgreementwillnotbeexercisable,unlessawaiveroftheapplicablelock-uprestrictionsisobtained,duringaperiodof180
daysafterthedateofthisprospectus.
114
Table of Contents
Nomination Rights
PursuanttotheInvestorRightsAgreement,BainCapitalwillinitiallybeentitledtodesignate50%ofourdirectors(roundinguptothenextwholenumber)andwill
continuetobeentitledtodesignatesuchpercentageofourdirectorsforsolongasitholdsatleast40%ofthenumberofsubordinatevotingsharesandmultiple
votingsharesoutstanding,providedthatthispercentagewillbereduced(i)tothegreaterofonedirectoror30%ofourdirectors(roundinguptothenextwhole
number)onceBainCapitalholdslessthan40%ofthesubordinatevotingsharesandmultiplevotingsharesoutstanding,(ii)tothegreaterofonedirectoror10%of
ourdirectors(roundinguptothenextwholenumber)onceBainCapitalholdslessthan20%ofthesubordinatevotingsharesandmultiplevotingshares
outstanding,and(iii)tononeonceBainCapitalholdslessthan5%ofthesubordinatevotingsharesandmultiplevotingsharesoutstanding.DTRLLCwillbe
entitledtodesignateonedirectorforaslongasitholds5%ormoreofthesubordinatevotingshareandmultiplevotingsharesoutstanding.
ThenominationrightscontainedintheInvestorRightsAgreementwillprovidethatBainCapitalandDTRLLC,attherelevanttime,willcastallvotestowhich
theyareentitledtoelectdirectorsdesignatedinaccordancewiththetermsandconditionsoftheInvestorRightsAgreement.
Management Agreement
InconnectionwiththeAcquisition,onDecember9,2013weenteredintoaManagementAgreementwithcertainaffiliatesofBainCapital,L.P.,whichwereferto
astheManagerforatermoffiveyears,pursuanttowhichtheManagerprovidesuswithcertainbusinessconsultingservices.Inexchangefortheseservices,we
paytheManageraquarterlyfeeequaltofour-tenthsofonepercent(0.4%)ofourtotalrevenuegeneratedduringthecalendarquarterbeginningsixmonthspriorto
suchpaymentdate,nottoexceed$2millionperyear.Inaddition,theManagerisentitledtoatransactionfeeinconnectionwithanyfinancing,acquisition,
dispositionorchangeofcontroltransaction.Thefeespaidfortheseservices,includingtransactionfeesinconnectionwiththeAcquisition,wereUS$0.8million,
US$0.7millionandUS$1.5million,respectivelyforfiscal2016,fiscal2015andfiscal2014.WealsoreimbursetheManagerforout-of-pocketexpensesincurred
inconnectionwiththeprovisionoftheservices.TheManagementAgreementincludescustomaryexculpationandindemnificationprovisionsinfavorofthe
Manageranditsaffiliates.TheManagementAgreementwillterminatepursuanttoitstermsupontheconsummationofthisoffering,atwhichtimewewillpaythe
Manageralumpsumamountof$9.6million.TheindemnificationandexculpationprovisionsinfavoroftheManagerwillsurvivesuchtermination.
115
Table of Contents
116
Table of Contents
ThefollowingtablesetsforthinformationrelatingtothebeneficialownershipofoursharesasofMarch1,2017,by:
eachperson,orgroupofaffiliatedpersons,knownbyustobeneficiallyownmorethan5%ofouroutstandingshares,whichincludescertainofthe
sellingshareholders;
eachoftheothersellingshareholders;
eachofourdirectors;
eachofournamedexecutiveofficers;and
alldirectorsandexecutiveofficersasagroup.
BeneficialownershipisdeterminedinaccordancewithSECrules.Theinformationisnotnecessarilyindicativeofbeneficialownershipforanyotherpurpose.In
general,undertheserulesabeneficialownerofasecurityincludesanypersonwho,directlyorindirectly,throughanycontract,arrangement,understanding,
relationshiporotherwisehasorsharesvotingpowerorinvestmentpowerwithrespecttosuchsecurity.Apersonisalsodeemedtobeabeneficialownerofa
securityifthatpersonhastherighttoacquirebeneficialownershipofsuchsecuritywithin60days.Exceptasotherwiseindicated,andsubjecttoapplicable
communitypropertylaws,thepersonsnamedinthetablehavesolevotingandinvestmentpowerwithrespecttoallsharesheldbythatperson.
Thepercentageofvotingsharesbeneficiallyownediscomputedonthebasisof100,000,000multiplevotingsharesandnosubordinatevotingsharesoutstanding
priortothisoffering.Sharesthatapersonhastherighttoacquirewithin60daysofthisofferingaredeemedoutstandingforpurposesofcomputingthepercentage
ownershipofsuchpersonsholdings,butarenotdeemedoutstandingforpurposesofcomputingthepercentageownershipofanyotherperson,exceptwithrespect
tothepercentageownershipofalldirectorsandexecutiveofficersasagroup.Unlessotherwiseindicatedbelow,theaddressforeachbeneficialownerlistedisc/o
CanadaGooseHoldingsInc.,250BowieAvenue,Toronto,Ontario,Canada,M6E4Y2.
117
Table of Contents
* Lessthan1%.
(1) Percentageoftotalvotingpowerrepresentsvotingpowerwithrespecttoallofourmultiplevotingandsubordinatevotingshares,asasingleclass.The
holdersofourmultiplevotingsharesareentitledto10votespershare,andholdersofoursubordinatevotingsharesareentitledtoonevotepershare.For
moreinformationaboutthevotingrightsofourmultiplevotingsharesandsubordinatevotingshares,seeDescriptionofShareCapitalAuthorizedShare
Capital.
(2) Assumesnoexerciseoftheunderwritersover-allotmentoptiontopurchaseupto3,000,000additionalsubordinatevotingsharesfromcertainoftheselling
shareholders.SeeUnderwriting.
(3) IncludessharesregisteredinthenameofBrent(BC)ParticipationS.r.l(theBainCapitalEntity),whichisownedbyBrent(BC)S.r.l,whichinturnis
ownedbyBainCapitalIntegralInvestors2008,L.P.BainCapitalInvestors,LLC(BCI)isthegeneralpartnerofBainCapitalIntegralInvestors2008,L.P.
Thegovernance,investmentstrategyanddecision-makingprocesswithrespecttoinvestmentsheldbytheBainCapitalEntityisdirectedbytheGlobal
PrivateEquityBoardofBCI.Asaresultoftherelationshipsdescribedabove,BCImaybedeemedtosharebeneficialownershipofthesharesheldbythe
BainCapitalEntity.TheBainCapitalEntityhasanaddressc/oBainCapitalPrivateEquity,LP,200ClarendonStreet,Boston,Massachusetts02116.The
numberofsharesownedbeforethisofferinggiveseffecttothecharitablecontributionsbycertainpartnersorotheremployeesofcertainentitiesaffiliated
withtheBainCapitalEntityonMarch15,2017inrespectofsharespreviouslyheldbytheBainCapitalEntity,asdescribedinFootnote7below.
(4) Onafully-dilutedbasis,60,415,708multiplevotingsharesandnosubordinatevotingshares,representing68%ofthetotalvotingpowerofoursharesupon
completionofthisoffering(58,315,708multiplevotingsharesandnosubordinatevotingshares,representing68%ofthetotalvotingpowerofourshares,
assumingtheexerciseinfulloftheunderwritersover-allotmentoptiontopurchaseadditionalsubordinatevotingshares).
(5) IncludessharesregisteredinthenameofDTRLLC,anentityindirectlycontrolledbyDaniReiss.AsatDecember31,2016,DTRLLCalsoheld63,576,003
ClassDPreferredShares;subsequently,onJanuary31,2017,theClassDPreferredShareswereredeemedinsettlementoftheDTRPromissoryNote.
(6) Onafully-dilutedbasis,25,892,446multiplevotingsharesandnosubordinatevotingshares,representing29%ofthetotalvotingpowerofoursharesupon
completionofthisoffering(24,992,446multiplevotingsharesandnosubordinatevotingshares,representing29%ofthetotalvotingpowerofourshares
assumingtheexerciseinfulloftheunderwritersoptiontopurchaseadditionalsubordinatevotingshares).
(7) Representssubordinatevotingsharesreceivedbysuchentityasacharitablecontributionfromcertainpartnersorotheremployeesofcertainentitiesaffiliated
withtheBainCapitalEntityonMarch15,2017.TheaddressoftheCombinedJewishPhilanthropiesofGreaterBoston,Inc.is126HighStreet,Boston,
Massachusetts02110.TheaddressofFidelityInvestmentsCharitableGiftFundis200SeaportBoulevard,Z3B,Boston,Massachusetts02210.
(8) DoesnotincludesharesheldbytheBainCapitalEntity.EachofMessrs.CottonandBekensteinisaManagingDirectorofBCIandasaresultmaybe
deemedtosharebeneficialownershipofthesharesheldbytheBainCapitalEntity.TheaddressforMessrs.CottonandBekensteinisc/oBainCapital
PrivateEquity,LP,200ClarendonStreet,Boston,Massachusetts02116.
(9) Mr.Cameronholdsnovestedoptions.Mr.Riddlestoneiscontractuallyrestrictedfromexercisinganyoptionsthatotherwisewouldhavevesteduntilthe
expirationofthelockupperiodpursuanttothetermsofhisseparationagreement.
(10) Mr.RiddlestonesemploymentwiththecompanyterminatedonJanuary10,2017.
(11) Includes656,205vestedoptionsgrantedundertheLegacyOptionPlanwhichareexercisableintosubordinatevotingshares.
118
Table of Contents
Description of Indebtedness
We summarize below certain terms and provisions of the agreements that govern our asset-based Revolving Facility and our Term Loan Facility. We refer you to
the exhibits to the registration statement relating to this offering for a copy of the agreements governing the senior secured credit facilities described below as this
summary does not purport to be complete and is subject to, and is qualified in its entirety by reference to, all of the provisions of the applicable agreements. Unless
noted otherwise, dollar amounts herein are Canadian dollars.
Revolving Facility
General
OnJune3,2016,CanadaGooseHoldingsInc.anditswholly-ownedsubsidiaries,CanadaGooseInc.(CGIBorrower)andCanadaGooseInternationalAG
(SwissBorrower),enteredintoaseniorsecuredasset-basedrevolvingfacility(theRevolvingFacility),withCanadianImperialBankofCommerce,as
administrativeagent,andcertainfinancialinstitutionsaslenders.TheRevolvingFacilityhascommitmentsof$150.0millionwithaseasonalincreaseofupto
$200.0millionduringpeakseason(June1throughNovember30,thePeakSeason).Inaddition,theRevolvingFacilityincludesaletterofcreditsub-facilityof
$25.0million.InrespectoflettersofcreditissuedinacurrencyotherthanCanadiandollars,U.S.dollarsorEuros,theletterofcreditsub-facilityiscappedat$5.0
millioninsuchalternativecurrency.
TheborrowingbaseundertheRevolvingFacility,subjecttocertainexceptionsandcustomaryreserves,equals(i)withrespecttoCGIBorrower,thesumof(a)
90%ofeligiblecreditcardreceivables,(b)90%ofcreditenhancedeligibletradereceivables(or85%ofnon-creditenhancedeligibletradereceivables)and(c)
90%(or92.5%duringPeakSeason)oftheappraisednetorderlyliquidationvalueofeligibleinventory(includingeligiblein-transitinventoryandeligibleletterof
creditinventory),ineachcase,ofCGIBorrowerandotherCGIborrowingbaseparties(theCGIBorrowingBase)and(ii)withrespecttoSwissBorrower,the
sumof(a)90%ofeligiblecreditcardreceivables,(b)90%ofcreditenhancedeligibletradereceivables(or85%ofnon-creditenhancedeligibletradereceivables)
and(c)90%(or92.5%duringPeakSeason)oftheappraisednetorderlyliquidationvalueofeligibleinventory,ineachcase,ofSwissBorrowerandanyother
Swissborrowingbaseparties(theSwissBorrowingBase).
AsofDecember31,2016wehad$59.8millionoutstandingundertheRevolvingFacility.AmountsundertheRevolvingFacilitymaybeborrowed,repaidandre-
borrowedtofundourgeneralcorporatepurposes.
AcommitmentfeewillbechargedontheaveragedailyunusedportionoftheRevolvingFacilityof0.25%perannumifaverageutilizationundertheRevolving
Facilityisgreaterthan50%or0.375%ifaverageutilizationundertheRevolvingFacilityislessthan50%.Aletterofcreditfee,withrespecttostandbylettersof
creditwillaccrueontheaggregatefaceamountofoutstandinglettersofcreditundertheRevolvingFacilityequaltothe
119
Table of Contents
relevantApplicableMarginforLIBORLoans,and,withrespecttotradeorcommerciallettersofcredit,50%ofthethenapplicableApplicableMarginonLIBOR
Loans.Afrontingfeewillbechargedontheaggregatefaceamountofoutstandinglettersofcreditequalto0.125%perannum.Inaddition,wepaythe
administrativeagentundertheRevolvingFacilityamonitoringfeeof$1,000permonth.
Currencies
BorrowingwillbeavailableundertheRevolvingFacilityinU.S.dollars,Canadiandollars,Eurosand,subjecttoanaggregatecapof$40.0million,suchother
currenciesasareapprovedinaccordancewiththecreditagreementgoverningtheRevolvingFacility,subjecttoanyotheritemsandconditionsrequiredbythe
administrativeagentandthelenders.
Collateral; Guarantees
AllobligationsundertheRevolvingFacilityareunconditionallyguaranteedbyCanadaGooseHoldingsInc.andsubjecttocertainexceptions,ourU.S.,Swiss,
U.K.andCanadiansubsidiaries,whichwerefertoastheABLLoanParties.AllobligationsundertheRevolvingFacility,andtheguaranteesofthoseobligations,
aresecured,subjectineachcasetocertainexceptionsandthresholds,(i)onafirstprioritybasisbysubstantiallyallpersonalpropertyoftheABLLoanParties
consistingofaccountsreceivable,inventory,cash,depositaccounts,securitiesaccounts,commodityaccountsandproceedsthereof(theCurrentAssetCollateral)
and(ii)onasecondprioritybasis,(x)byapledgeofallcapitalstockoftheCGIBorrowerandallofthecapitalstockinmaterialwholly-ownedrestricted
subsidiariesdirectlyheldbytheABLLoanParties(otherthananycapitalstockinmaterialwholly-ownedrestrictedsubsidiariesdirectlyheldbySwissBorrower,
which,ifany,issecuredundertheRevolvingFacilityonafirstprioritybasis)(thePledgedCollateral),(y)byallmaterialfee-ownedrealpropertyandequipment
oftheABLLoanParties(otherthananymaterialfee-ownedrealpropertyandequipmentofSwissBorrower,which,ifany,issecuredundertheRevolvingFacility
onafirstprioritybasis)(thePP&ECollateral),and(z)bysubstantiallyallotherpersonalpropertyoftheABLLoanParties(otherthananyotherpersonal
propertyofSwissBorrower,whichissecuredundertheRevolvingFacilityonafirstprioritybasis).
Maturity; Prepayments
ThematuritydateoftheRevolvingFacilityisJune3,2021.
ExceptwithrespecttoprotectiveadvancesundertheRevolvingFacility,ifatanytime(a)theaggregateamountoutstandingundertheRevolvingFacilityexceeds
thelesserof(i)thetotalrevolvingcommitmentamountatsuchtimeand(ii)theaggregateborrowingbaseatsuchtime(suchlesseramount,theLineCap),
(b)theaggregateamountoutstandingtotheSwissBorrowerexceedsthelinecapundertheSwissBorrowingBaseor(c)theaggregateamountoutstandingtothe
CGIBorrowerexceedsthelinecapundertheCGIBorrowingBase,thenwearerequiredtorepayoutstandingloansand/orcashcollateralizelettersofcreditinan
aggregateamountequaltosuchexcess,withnoreductionofthecommitmentamount.
VoluntaryprepaymentsoftheRevolvingFacilityandvoluntaryreductionsoftheunutilizedportionofthecommitmentamountmaybemadeatanytime(subjectto
minimumrepaymentamountsandcustomarynoticeperiods)withoutpremiumorpenalty,otherthancustomarybreakagecosts,ifapplicable.
Amortization
ThereisnoscheduledamortizationunderourRevolvingFacility.
120
Table of Contents
Covenants
TheRevolvingFacilitycontainsanumberofcustomaryaffirmativecovenantsandcustomarynegativecovenantsthat,amongotherthings,limitorrestrictthe
abilityofCGIBorroweranditsrestrictedsubsidiaries,and,inthecaseofthepassiveactivitycovenantdescribedbelow,CanadaGooseHoldingsInc.sabilityto
(ineachcase,subjecttocertainexceptions):
incuradditionalindebtedness(includingguaranteeobligations);
incurliens;
engageincertainfundamentalchanges,includingchangesinthenatureofbusiness,mergers,amalgamations,liquidationsanddissolutions;
sellassets;
paydividendsormakedistributions,andmakesharerepurchasesandredemptions;
makeacquisitions,investments,loansandadvances;
prepayormodifythetermsofcertainsubordinatedindebtedness;
modifyorganizationaldocuments;
engageincertaintransactionswithaffiliates;
inthecaseofCanadaGooseHoldingsInc.,engageinactivitiesotherthanasapassiveholdingcompany;
changeourfiscalyear;and
enterintonegativepledgeclausesandclausesrestrictingsubsidiarydistributions.
Financial Covenant
TheRevolvingFacilitycontainsaspringingconsolidatedfixedchargecoverageratiofinancialcovenantthatrequiresustomaintainafixedchargecoverageratio
ofatleast1.00to1.00whenExcessAvailabilityfallsbelowthegreaterof(i)$7.5millionand(ii)10%oftheLineCap,whichfinancialcovenantwillbetestedon
atrailingfourquarterbasisimmediatelyupontriggerbasedonthemostrecentlycompletedfiscalquarterforwhichfinancialstatementswererequiredtobe
deliveredandonthelastdayofeachsubsequentlycompletedfiscalquarterofCGIBorroweruntilExcessAvailabilityexceedsthethresholdspecifiedabovefor30
consecutivecalendardays.ExcessAvailabilityundertheRevolvingFacilityequalstheremainderof(i)thesumof(x)theLineCapplus(y)theamountof
unrestrictedcashandcashequivalentsofCGIBorrowerandtheguarantorsthatareheldinaccountsforwhichtheadministrativeagentundertheRevolving
Facilityhasaccountcontrolagreementsinplace,plus(z)theamount,ifany,bywhichtheaggregateborrowingbaseundertheRevolvingFacilityexceedsthe
aggregatecommitmentsundertheRevolvingFacility,over(ii)thesumof(x)theaggregateprincipalamountofalloutstandingloans(includingswinglineloans)
undertheRevolvingFacilityand(y)alloutstandinglettersofcreditundertheRevolvingFacility(plus,withoutduplication,allunreimburseddisbursementswith
respecttoanylettersofcreditundertheRevolvingFacility).
Events of Default
TheRevolvingFacilityprovidesforcustomaryeventsofdefault(ineachcase,subjecttocustomarygraceperiods,basketsandmaterialitythresholds),including(i)
nonpaymentofanyprincipal,interestorfees,subjecttoapplicablegraceperiods,(ii)failuretoperformorobserveanycovenants,subjecttoapplicablegrace
periods,(iii)materialinaccuracyofrepresentationsandwarranties,(iv)cross-defaulttoindebtednessover$20million(subjecttocertainlimitationsinthecaseof
defaultsundertheTermLoanFacility),(v)bankruptcyevents,(vi)judgmentswithrespecttowhich$20millionormoreisnotcoveredbyinsuranceorindemnities
ifnot
121
Table of Contents
satisfiedwithin60daysofentrythereof,(vii)invalidityofanysecurityorguaranteedocument,(viii)changeofcontrol,(ix)suspensionoftheoperationof
business,orliquidationofallorsubstantiallyalloftheassets,ineachcaseofCGIBorrower,SwissBorrowerandtheguarantors,takenasawhole,(x)ERISAor
CanadianPensionPlanliabilitieswhichresultinamaterialadverseeffectand(xi)failuretomaintainseniorityofsecurityinterest.
Upontheoccurrenceofaneventofdefaultthatiscontinuingandabsentawaiveroranamendmentfromthelenders,theadministrativeagentatthediscretionof
therequiredlenders,canterminatethecommitmentsandacceleratepaymentofalloutstandingobligationsundertheRevolvingFacility,subjectto,inthecaseofa
financialcovenantdefault,theapplicablecureperiod.
TheproceedsofthetermloansborrowedundertheTermLoanFacilitywereusedtoeffectthestepsdescribedinthisprospectusunderRecapitalization,topay
transactionexpensesinconnectionwiththeclosingoftheTermLoanFacilityandforothergeneralcorporatepurposes.
AsofDecember31,2016,wehadapproximately$218.3millionaggregateprincipalamountoftermloansoutstandingundertheTermLoanFacility.Amounts
prepaidorrepaidundertheTermLoanFacilitymaynotbere-borrowed.
Collateral; Guarantees
AllobligationsundertheTermLoanFacilityareunconditionallyguaranteedbyCanadaGooseHoldingsInc.and,subjecttocertainexceptions,ourU.S.,U.K.and
Canadiansubsidiaries(theTermLoanParties).AllobligationsundertheTermLoanFacility,andtheguaranteesofthoseobligations,aresecured,subject,in
each
122
Table of Contents
case,tocertainexceptionsandthresholds,(i)onafirstprioritybasis,(x)byapledgeofthePledgedCollateraldirectlyheldbytheTermLoanParties,(y)bythe
PP&ECollateraloftheTermLoanParties,and(z)bysubstantiallyallotherpersonalpropertyoftheTermLoanPartiesand(ii)onasecondprioritybasis,bythe
CurrentAssetCollateraloftheTermLoanParties.
Maturity; Prepayments
ThematuritydateoftheTermLoanFacilityisDecember2,2021.
WearerequiredtoprepayoutstandingtermloansundertheTermLoanFacilitywiththeproceedsofnon-ordinarycourseassetsalesandcasualtyand
condemnationevents(ineachcase,subjecttocertainexceptionsandcustomaryreinvestmentrights)andcertainissuancesofindebtedness(otherthancertain
permittedindebtedness).Apercentage(tobedeterminedbasedupontheBorrowersconsolidatedfirstliennetleverageratioasofthetestperiodendedonthelast
dayoftheapplicablefiscalyear)ofourexcesscashflow(asdefinedinthecreditagreement)foreachfiscalyearmustalsobeappliedtoprepaytermloans
outstandingundertheTermLoanFacilitycommencingwithandincludingthefiscalyearendingMarch31,2018,exceptthatsuchprepaymentisonlyrequiredin
respectofanyfiscalyeartotheextentthattheexcesscashflowprepaymentamountforsuchfiscalyearexceeds$5.0million.
Withintenbusinessdaysofreceiptofthenetcashproceedsofthisoffering(oranyotherunderwrittenprimarypublicofferingofcommonequitybytheBorrower
oranydirectorindirectparentthereof),untilsuchtimeastheBorrowerhasprepaidtermloansundertheTermLoanFacilitywiththeproceedsofthisoffering(or
anysuchotheroffering),suchthattheBorrowersconsolidatedtotalnetleverageratioisequaltoorlessthan2.50to1.00,theBorrowermustprepay(orcauseto
prepay),inaccordancewiththecreditagreementgoverningtheTermLoanFacility,termloansundertheTermLoanFacilityinanaggregateprincipalamount
equaltothelesserof(i)100.0%ofthenetcashproceedsfromsuchofferingand(ii)anamountofsuchnetcashproceedssuchthat,aftergivingproformaeffectto
suchprepaymentoftermloanswithsuchamount,theBorrowersconsolidatedtotalnetleverageratiowouldbeequalto2.50to1.00.
VoluntaryprepaymentsoftheTermLoanFacilitymaybemadeatanytime(subjecttominimumrepaymentamountsandcustomarynoticeperiods)without
premiumorpenalty,otherthancustomarybreakagecosts,ifapplicable.
123
Table of Contents
Facility,theproformaconsolidatedfirstliennetleverageratiooftheBorrowertoexceed3.75to1.00or(2)inthecaseofdebtthatisunsecuredorsecuredona
juniorbasistotheTermLoanFacility(excluding,fortheavoidanceofdoubt,debtundertheRevolvingFacility),theproformaconsolidatedtotalnetleverageratio
oftheBorrowertoexceed5.50to1.00.
Amortization
ThetermloansundertheTermLoanFacilityamortizeinequalquarterlyinstallmentsinanaggregateannualamountequalto1%oftheoriginalprincipalamount
thereof,payableonthelastbusinessdayofeachMarch,June,SeptemberandDecember,commencingwiththelastbusinessdayofthesecondfullfiscalquarter
endingaftertheclosingdateoftheTermLoanFacility.ThebalanceoftheoutstandingtermloansispayableonthefifthanniversaryoftheTermLoanClosing
Date.
Covenants
TheTermLoanFacilitycontainsanumberofcustomaryaffirmativecovenantsandcustomarynegativecovenantsthat,amongotherthings,limitorrestrictthe
abilityoftheBorroweranditsrestrictedsubsidiaries,and,inthecaseofthepassiveactivitycovenantdescribedbelow,CanadaGooseHoldingsInc.sabilityto(in
eachcase,subjecttocertainexceptions):
incuradditionalindebtedness(includingguaranteeobligations);
incurliens;
engageincertainfundamentalchanges,includingchangesinthenatureofbusiness,mergers,amalgamations,liquidationsanddissolutions;
sellassets;
paydividendsormakedistributions,andmakesharerepurchasesandredemptions;
makeacquisitions,investments,loansandadvances;
prepayormodifythetermsofcertainsubordinatedindebtedness;
modifyorganizationaldocuments;
engageincertaintransactionswithaffiliates;
inthecaseofCanadaGooseHoldingsInc.,engageinactivitiesotherthanasapassiveholdingcompany;
changeourfiscalyear;and
enterclausesrestrictingsubsidiarydistributions.
ThereisnofinancialmaintenancecovenantundertheTermLoanFacility.
Events of Default
TheTermLoanFacilityprovidesforcustomaryeventsofdefault(ineachcase,subjecttocustomarygraceperiods,basketsandmaterialitythresholds),including
(i)nonpaymentofanyprincipal,interestorfees,subjecttoapplicablegraceperiods,(ii)failuretoperformorobserveanycovenants,subjecttoapplicablegrace
periods,(iii)materialinaccuracyofrepresentationsandwarranties,(iv)cross-defaulttoindebtednessover$20million(subjecttocertainlimitationsinthecaseof
defaultsundertheRevolvingFacility),(v)bankruptcyevents,(vi)judgmentswithrespecttowhich$20millionormoreisnotcoveredbyinsuranceorindemnities
ifnotsatisfiedwithin60daysofentrythereof,(vii)invalidityofanysecurityorguaranteedocument,(viii)changeofcontrol,(ix)ERISAorCanadianPensionPlan
liabilitieswhichresultinamaterialadverseeffect,and(x)failuretomaintainseniorityofsecurityinterest.
124
Table of Contents
Upontheoccurrenceofaneventofdefaultandabsentawaiveroranamendmentfromthelenders,theadministrativeagent,atthedirectionoftherequiredlenders,
canacceleratepaymentofalloutstandingobligationsundertheTermLoanFacility.
125
Table of Contents
General
FollowingtheRecapitalization,asofDecember2,2016,ownershipofoursecuritieswasasfollows:
100,000,000ClassACommonSharesoutstandingandheldbyinvestmentfundsadvisedbyBainCapitalandbyDTRLLC,anentityindirectly
controlledbyDaniReiss;
63,576,003ClassDPreferredSharesheldbyDTRLLC;and
noClassBCommonShares,ClassASeniorPreferredShares,ClassBSeniorPreferredShares,ClassAJuniorPreferredShares,ClassBJunior
PreferredSharesorClassCJuniorPreferredShareswereissuedandoutstanding.
OnJanuary31,2017,allofourClassDPreferredShareswereredeemedbythecompanyforcancellationandtheDTRPromissoryNotewasextinguishedin
exchangefortheredemptionoftheClassDPreferredShares.SeeRecapitalization.
Inconnectionwiththisofferingweamendedandrestatedourarticlesinorderto,amongotherthings:
amendandredesignateourClassACommonSharesasmultiplevotingshares;
eliminateourClassBCommonShares,ClassASeniorPreferredShares,ClassBSeniorPreferredShares,ClassAJuniorPreferredShares,ClassB
JuniorPreferredShares,ClassCJuniorPreferredSharesandtheClassDPreferredSharesfromoursharecapital;and
createoursubordinatevotingshares.
Ourarticlesalsoprovideforanunlimitednumberofpreferredshares,issuableinseries.Thefollowingisasummaryofthetermsofoursubordinatevotingshares,
multiplevotingsharesandpreferredshares,assetforthinourarticles,andcertainrelatedsectionsoftheBCBCA.Thefollowingsummaryissubjectto,andis
qualifiedinitsentiretybyreferenceto,theprovisionsofourarticlesandtheapplicableprovisionsoftheBCBCA.Youmayobtaincopiesofourarticlesas
describedunderWhereYouCanFindMoreInformationinthisprospectus.
ThesubordinatevotingsharesarerestrictedsecuritieswithinthemeaningofsuchtermunderapplicablesecuritieslawsinCanada.Weareexemptfromthe
requirementsofSection12.3ofNationalInstrument41-101General Prospectus Requirements onthebasisthatwewereaprivateissuerwithinthemeaningof
suchtermunderapplicablesecuritieslawsinCanadaimmediatelybeforefilingthisprospectus.
WewillfileanundertakingwiththeOntarioSecuritiesCommissionpursuanttowhichwewillagreetoprovidereasonablepriornoticetotheOntarioSecurities
Commissionintheeventthatweintendtoissueaseriesofpreferredsharesthatwouldrestricttherightsofthesubordinatevotingshares,regardlessofanyexisting
restrictionsonthesubordinatevotingsharesduetotheexistenceofthemultiplevotingshares.
126
Table of Contents
entitledtovote.Aftergivingeffecttotheoffering,thesubordinatevotingshareswillcollectivelyrepresent19%ofourtotalissuedandoutstandingsharesand2%
ofthevotingpowerattachedtoallofourissuedandoutstandingshares(22%and3%,respectively,iftheover-allotmentoptionisexercisedinfull).Subjecttothe
priorrightsoftheholdersofourpreferredshares,theholdersofourmultiplevotingsharesandsubordinatevotingsharesareentitledtoreceivedividendsasand
whendeclaredbyourboardofdirectors,withoutpreferenceordistinctionamongorbetweenthesubordinatevotingsharesandthemultiplevotingshares.Seethe
sectionentitledDividendPolicy.Subjecttothepriorpaymenttotheholdersofourpreferredshares,intheeventofourliquidation,dissolutionorwinding-upor
otherdistributionofourassetsamongourshareholders,theholdersofourmultiplevotingsharesandsubordinatevotingsharesareentitledtoshareproratainthe
distributionofthebalanceofourassets,withoutpreferenceordistinctionamongorbetweenthesubordinatevotingsharesandthemultiplevotingshares.Holders
ofmultiplevotingsharesandsubordinatevotingshareshavenopre-emptiveorconversionorexchangerightsorothersubscriptionrights,exceptthateach
outstandingmultiplevotingsharemayatanytime,attheoptionoftheholder,beconvertedintoonesubordinatevotingshareandourmultiplevotingshareswill
automaticallyconvertintosharesofoursubordinatevotingsharesuponcertaintransfersandotherevents,asdescribedbelowunderConversion.Thereareno
redemption,retraction,purchaseforcancellationorsurrenderprovisionsorsinkingorpurchasefundprovisionsapplicabletooursubordinatevotingsharesor
multiplevotingshares.Thereisnoprovisioninourarticlesrequiringholdersofsubordinatevotingsharesormultiplevotingsharestocontributeadditionalcapital,
orpermittingorrestrictingtheissuanceofadditionalsecuritiesoranyothermaterialrestrictions.Thespecialrightsorrestrictionsattachedtothesubordinatevoting
sharesandmultiplevotingsharesaresubjecttoandmaybeadverselyaffectedby,therightsattachedtoanyseriesofpreferredsharesthatwemaydesignateinthe
future.
Conversion
Thesubordinatevotingsharesarenotconvertibleintoanyotherclassofshares.Eachoutstandingmultiplevotingsharemayatanytime,attheoptionoftheholder,
beconvertedintoonesubordinatevotingshare.UponthefirstdatethatanymultiplevotingshareshallbeheldbyapersonotherthanbyaPermittedHolder(as
definedbelow),thePermittedHolderwhichheldsuchmultiplevotingshareuntilsuchdate,withoutanyfurtheraction,shallautomaticallybedeemedtohave
exercisedhis,heroritsrightstoconvertsuchmultiplevotingshareintoafullypaidandnon-assessablesubordinatevotingshare.
Inaddition:
allmultiplevotingsharesheldbytheBainGroupPermittedHolderswillconvertautomaticallyintosubordinatevotingsharesatsuchtimeastheBain
GroupPermittedHoldersthatholdmultiplevotingsharesnolongerasagroupbeneficiallyown,directlyorindirectlyandintheaggregate,atleast
15%oftheissuedandoutstandingsubordinatevotingsharesandmultiplevotingshares;and
allmultiplevotingsharesheldbytheReissGroupPermittedHolderswillconvertautomaticallyintosubordinatevotingsharesatsuchtimethatisthe
earliertooccurofthefollowing:(i)theReissGroupPermittedHoldersthatholdmultiplevotingsharesnolongerasagroupbeneficiallyown,directly
orindirectlyandintheaggregate,atleast15%oftheissuedandoutstandingsubordinatevotingsharesandmultiplevotingshares,and(ii)DaniReiss
isnolongerservingasadirectororinaseniormanagementpositionatourcompany.
Forthepurposesoftheforegoing:
Affiliatemeans,withrespecttoanyspecifiedPerson,anyotherPersonwhichdirectlyorindirectlythroughoneormoreintermediariescontrols,iscontrolledby,
orisundercommoncontrolwithsuchspecifiedPerson;
BainGroupPermittedHoldersmeansBrent(B.C.)ParticipationS.r.l.andanyofitsAffiliates,andentitiescontrolled,directlyorindirectly,ormanagedby
BainCapitaloranAffiliateofBainCapital;
MembersoftheImmediateFamilymeanswithrespecttoanyindividual,eachparent(whetherbybirthoradoption),spouse,orchild(includinganystep-child)or
otherdescendants(whetherbybirthoradoption)ofsuch
127
Table of Contents
individual,eachspouseofanyoftheaforementionedPersons,eachtrustcreatedsolelyforthebenefitofsuchindividualand/oroneormoreoftheaforementioned
PersonsandeachlegalrepresentativeofsuchindividualorofanyaforementionedPersons(includingwithoutlimitationatutor,curator,mandatarydueto
incapacity,custodian,guardianortestamentaryexecutor),actinginsuchcapacityundertheauthorityofthelaw,anorderfromacompetenttribunal,awillora
mandateincaseofincapacityorsimilarinstrument.Forthepurposesofthisdefinition,aPersonshallbeconsideredthespouseofanindividualifsuchPersonis
legallymarriedtosuchindividual,livesinacivilunionwithsuchindividualoristhecommonlawpartner(asdefinedintheIncome Tax Act (Canada)asamended
fromtimetotime)ofsuchindividual.APersonwhowasthespouseofanindividualwithinthemeaningofthisparagraphimmediatelybeforethedeathofsuch
individualshallcontinuetobeconsideredaspouseofsuchindividualafterthedeathofsuchindividual;
PermittedHoldersmeansanyof(i)theBainGroupPermittedHolders,and(ii)theReissGroupPermittedHolders;
Personmeansanyindividual,partnership,corporation,company,association,trust,jointventureorlimitedliabilitycompany;
ReissGroupPermittedHoldersmeans(i)DaniReissandanyMembersoftheImmediateFamilyofDaniReiss,and(ii)anyPersoncontrolled,directlyor
indirectlybyoneormoreofthePersonsreferredtoinclause(i)above;and
APersoniscontrolledbyanotherPersonorotherPersonsif:(i)inthecaseofacompanyorotherbodycorporatewhereverorhoweverincorporated:
(A)securitiesentitledtovoteintheelectionofdirectorscarryingintheaggregateatleastamajorityofthevotesfortheelectionofdirectorsandrepresentinginthe
aggregateatleastamajorityoftheparticipating(equity)securitiesareheld,otherthanbywayofsecurityonly,directlyorindirectly,byorsolelyforthebenefitof
theotherPersonorPersons;and(B)thevotescarriedintheaggregatebysuchsecuritiesareentitled,ifexercised,toelectamajorityoftheboardofdirectorsof
suchcompanyorotherbodycorporate;or(ii)inthecaseofaPersonthatisnotacompanyorotherbodycorporate,atleastamajorityoftheparticipating(equity)
andvotinginterestsofsuchPersonareheld,directlyorindirectly,byorsolelyforthebenefitoftheotherPersonorPersons;andcontrols,controllingand
undercommoncontrolwithshallbeinterpretedaccordingly.
Preferred Shares
Underourarticles,thepreferredsharesmaybeissuedinoneormoreseries.Accordingly,ourboardofdirectorsisauthorized,withoutshareholderapprovalbut
subjecttotheprovisionsoftheBCBCA,todeterminethemaximumnumberofsharesofeachseries,createanidentifyingnameforeachseriesandattachsuch
specialrightsorrestrictions,includingdividend,liquidationandvotingrights,asourboardofdirectorsmaydetermine,andsuchspecialrightsorrestrictions,
includingdividend,liquidationandvotingrights,maybesuperiortothoseofeachofthesubordinatevotingsharesandthemultiplevotingshares.Theissuanceof
preferredshares,whileprovidingflexibilityinconnectionwithpossibleacquisitionsandothercorporatepurposes,could,amongotherthings,havetheeffectof
delaying,deferringorpreventingachangeofcontrolofourcompanyandmightadverselyaffectthemarketpriceofoursubordinatevotingsharesandmultiple
votingsharesandthevotingandotherrightsoftheholdersofsubordinatevotingsharesandmultiplevotingshares.Wehavenocurrentplantoissueanypreferred
shares.
128
Table of Contents
Directors
Power to vote on matters in which a director is materially interested .UndertheBCBCAadirectorwhohasamaterialinterestinacontractortransaction,whether
madeorproposed,thatismaterialtous,mustdisclosesuchinteresttous,subjecttocertainexceptionssuchasifthecontractortransaction:(i)isanarrangement
bywayofsecuritygrantedbyusformoneyloanedto,orobligationsundertakenby,thedirectorforourbenefitorforoneofouraffiliatesbenefit;(ii)relatestoan
indemnityorinsurancepermittedundertheBCBCA;(iii)relatestotheremunerationofthedirectorinhisorhercapacityasdirector,officer,employeeoragentof
ourcompanyorofoneofouraffiliates;(iv)relatestoaloantoourcompanywhilethedirectoristheguarantorofsomeoralloftheloan;or(v)iswitha
corporationthatisaffiliatedtouswhilethedirectorisalsoadirectororseniorofficerofthatcorporationoranaffiliateofthatcorporation.
Adirectorwhoholdssuchdisclosableinterestinrespectofanymaterialcontractortransactionintowhichwehaveenteredorproposetoentermayberequiredto
absenthimselforherselffromthemeetingwhilediscussionsandvotingwithrespecttothematteraretakingplace.Directorswillalsoberequiredtocomplywith
certainotherrelevantprovisionsoftheBCBCAregardingconflictsofinterest.
Subdivision or Consolidation
Nosubdivisionorconsolidationofthesubordinatevotingsharesorthemultiplevotingsharesmaybecarriedoutunless,atthesametime,themultiplevoting
sharesorthesubordinatevotingshares,asthecasemaybe,aresubdividedorconsolidatedinthesamemannerandonthesamebasis.
129
Table of Contents
Pursuanttoourarticles,holdersofsubordinatevotingsharesandmultiplevotingshareswillbetreatedequallyandidentically,onapersharebasis,incertain
changeofcontroltransactionsthatrequireapprovalofourshareholdersundertheBCBCA,unlessdifferenttreatmentofthesharesofeachsuchclassisapproved
byamajorityofthevotescastbytheholdersofoursubordinatevotingsharesandmultiplevotingshares,eachvotingseparatelyasaclass.
Ourarticlesdonototherwisecontainanychangeofcontrollimitationswithrespecttoamerger,acquisitionorcorporaterestructuringthatinvolvesus.
Shareholder Meetings
Subjecttoapplicablestockexchangerequirements,wemustholdageneralmeetingofourshareholdersatleastonceeveryyearatatimeandplacedeterminedby
ourboardofdirectors,providedthatthemeetingmustnotbeheldlaterthan15monthsaftertheprecedingannualgeneralmeeting.Ameetingofourshareholders
maybeheldanywhereinoroutsideBritishColumbia.
Anoticetoconveneameeting,specifyingthedate,timeandlocationofthemeeting,and,whereameetingistoconsiderspecialbusiness,thegeneralnatureofthe
specialbusinessmustbesenttoeachshareholderentitledtoattendthemeetingandtoeachdirectornotlessthan21daysandnomorethan60dayspriortothe
meeting,although,asaresultofapplicablesecuritieslaws,theminimumtimefornoticeiseffectivelylongerinmostcircumstances.UndertheBCBCA,
shareholdersentitledtonoticeofameetingmaywaiveorreducetheperiodofnoticeforthatmeeting,providedapplicablesecuritieslawsaremet.Theaccidental
omissiontosendnoticeofanymeetingofshareholdersto,orthenon-receiptofanynoticeby,anypersonentitledtonoticedoesnotinvalidateanyproceedingsat
thatmeeting.
Aquorumformeetingsofshareholdersispresentifshareholderswho,intheaggregate,holdatleast25%oftheissuedsharesplusatleastamajorityofmultiple
votingsharesentitledtobevotedatthemeetingarepresentinpersonorrepresentedbyproxy.Ifaquorumisnotpresentattheopeningofanymeetingof
shareholders,themeetingstandsadjournedtothesamedayinthenextweekatthesametimeandplace,unlessthemeetingwasrequisitionedbyshareholders,in
whichcasethemeetingisdissolved.
Holdersofoursubordinatevotingsharesandmultiplevotingsharesareentitledtoattendandvoteatmeetingsofourshareholdersexceptmeetingsatwhichonly
holdersofaparticularclassareentitledtovote.Exceptasotherwiseprovidedwithrespecttoanyparticularseriesofpreferredshares,andexceptasotherwise
requiredbylaw,theholdersofourpreferredsharesarenotentitledasaclasstoreceivenoticeof,ortoattendorvoteatanymeetingsofourshareholders.Our
directors,oursecretary(ifany),ourauditorandanyotherpersonsinvitedbyourchairmanordirectorsorwiththeconsentofthoseatthemeetingareentitledto
attendanymeetingofourshareholdersbutwillnotbecountedinthequorumorbeentitledtovoteatthemeetingunlessheorsheisashareholderorproxyholder
entitledtovoteatthemeeting.
Wehaveincludedcertainadvancenoticeprovisionswithrespecttotheelectionofourdirectorsinourarticles(theAdvanceNoticeProvisions).TheAdvance
NoticeProvisionsareintendedto:(i)facilitateorderlyand
130
Table of Contents
efficientannualgeneralmeetingsor,wheretheneedarises,specialmeetings;(ii)ensurethatallshareholdersreceiveadequatenoticeofboardnominationsand
sufficientinformationwithrespecttoallnominees;and(iii)allowshareholderstoregisteraninformedvote.Onlypersonswhoarenominatedinaccordancewith
theAdvanceNoticeProvisionswillbeeligibleforelectionasdirectorsatanyannualmeetingofshareholders,oratanyspecialmeetingofshareholdersifoneof
thepurposesforwhichthespecialmeetingwascalledwastheelectionofdirectors.
UndertheAdvanceNoticeProvisions,ashareholderwishingtonominateadirectorwouldberequiredtoprovideusnotice,intheprescribedform,withinthe
prescribedtimeperiods.Thesetimeperiodsinclude,(i)inthecaseofanannualmeetingofshareholders(includingannualandspecialmeetings),notlessthan30
dayspriortothedateoftheannualmeetingofshareholders;provided,thatifthefirstpublicannouncementofthedateoftheannualmeetingofshareholders(the
NoticeDate)islessthan50daysbeforethemeetingdate,notlaterthanthecloseofbusinessonthe10thdayfollowingtheNoticeDate;and(ii)inthecaseofa
specialmeeting(whichisnotalsoanannualmeeting)ofshareholderscalledforanypurposewhichincludeselectingdirectors,notlaterthanthecloseofbusiness
onthe15thdayfollowingtheNoticeDate,providedthat,ineitherinstance,ifnotice-and-access(asdefinedinNationalInstrument54-101Communication with
Beneficial Owners of Securities of a Reporting Issuer )isusedfordeliveryofproxyrelatedmaterialsinrespectofameetingdescribedabove,andtheNoticeDate
inrespectofthemeetingisnotlessthan50dayspriortothedateoftheapplicablemeeting,thenoticemustbereceivednotlaterthanthecloseofbusinessonthe
40thdaybeforetheapplicablemeeting.
Theseprovisionscouldhavetheeffectofdelayinguntilthenextshareholdermeetingthenominationofcertainpersonsfordirectorthatarefavoredbytheholders
ofamajorityofouroutstandingvotingsecurities.
TheundertakingsintheCoattailAgreementwillnotapplytopreventasalebytheholdersofmultiplevotingsharesortheirPermittedHoldersofmultiplevoting
sharesifconcurrentlyanofferismadetopurchasesubordinatevotingsharesthat:
(a) offersapricepersubordinatevotingshareatleastashighasthehighestpricepersharetobepaidpursuanttothetake-overbidforthemultiplevoting
shares;
(b) providesthatthepercentageofoutstandingsubordinatevotingsharestobetakenup(exclusiveofsharesownedimmediatelypriortotheofferbythe
offerororpersonsactingjointlyorinconcertwiththeofferor)isatleastashighasthepercentageofmultiplevotingsharestobesold(exclusiveof
multiplevotingsharesownedimmediatelypriortotheofferbytheofferorandpersonsactingjointlyorinconcertwiththeofferor);
(c) hasnoconditionattachedotherthantherightnottotakeupandpayforsubordinatevotingsharestenderedifnosharesarepurchasedpursuanttothe
offerformultiplevotingshares;and
(d) isinallothermaterialrespectsidenticaltotheofferformultiplevotingshares.
Inaddition,theCoattailAgreementwillnotpreventthetransferofmultiplevotingsharestoPermittedHolders,providedsuchtransferisnotorwouldnothave
beensubjecttotherequirementstomakeatake-overbid(ifthe
131
Table of Contents
vendorortransfereewereinCanada)orconstitutesorwouldbeexemptfromcertainrequirementsapplicabletotake-overbidsunderapplicablesecuritieslawsin
Canada.Theconversionofmultiplevotingsharesintosubordinatevotingshares,whetherornotsuchsubordinatevotingsharesaresubsequentlysold,wouldnot
constituteadispositionofmultiplevotingsharesforthepurposesoftheCoattailAgreement.
UndertheCoattailAgreement,anysaleofmultiplevotingsharesbyaholderofmultiplevotingsharespartytotheCoattailAgreementwillbeconditionaluponthe
transfereebecomingapartytotheCoattailAgreement,totheextentsuchtransferredmultiplevotingsharesarenotautomaticallyconvertedintosubordinatevoting
sharesinaccordancewithourarticles.
TheCoattailAgreementwillcontainprovisionsforauthorizingactionbythetrusteetoenforcetherightsundertheCoattailAgreementonbehalfoftheholdersof
thesubordinatevotingshares.Theobligationofthetrusteetotakesuchactionwillbeconditionalonusorholdersofthesubordinatevotingsharesprovidingsuch
fundsandindemnityasthetrusteemayreasonablyrequire.Noholderofsubordinatevotingshareswillhavetheright,otherthanthroughthetrustee,toinstituteany
actionorproceedingortoexerciseanyotherremedytoenforceanyrightsarisingundertheCoattailAgreementunlessthetrusteefailstoactonarequest
authorizedbyholdersofnotlessthan10%oftheoutstandingsubordinatevotingsharesandreasonablefundsandindemnityhavebeenprovidedtothetrustee.
Otherthaninrespectofnon-materialamendmentsandwaiversthatdonotadverselyaffecttheinterestsofholdersofsubordinatevotingshares,theCoattail
Agreementwillprovidethat,amongotherthings,itmaynotbeamended,andnoprovisionthereofmaybewaived,unless,priortogivingeffecttosuchamendment
orwaiver,thefollowinghavebeenobtained:(a)theconsentoftheTSXandanyotherapplicablesecuritiesregulatoryauthorityinCanada;and(b)theapprovalof
atleasttwo-thirdsofthevotescastbyholdersofsubordinatevotingsharesrepresentedatameetingdulycalledforthepurposeofconsideringsuchamendmentor
waiver,excludingvotesattachedtosubordinatevotingsharesheldbytheholdersofmultiplevotingsharesortheiraffiliatesandrelatedpartiesandanypersons
whohaveanagreementtopurchasemultiplevotingsharesontermswhichwouldconstituteasaleordispositionforpurposesoftheCoattailAgreement,otherthan
aspermittedthereby.
NoprovisionoftheCoattailAgreementwilllimittherightsofanyholdersofsubordinatevotingsharesunderapplicablelaw.
Forum Selection
Wehaveincludedaforumselectionprovisioninourarticlesthatprovidesthat,unlessweconsentinwritingtotheselectionofanalternativeforum,theSuperior
CourtofJusticeoftheProvinceofOntario,Canadaandtheappellatecourtstherefrom,willbethesoleandexclusiveforumfor(i)anyderivativeactionor
proceedingbroughtonourbehalf;(ii)anyactionorproceedingassertingaclaimofbreachofafiduciarydutyowedbyanyofourdirectors,officers,orother
employeestous;(iii)anyactionorproceedingassertingaclaimarisingpursuanttoanyprovisionoftheBCBCAorourarticles;or(iv)anyactionorproceeding
assertingaclaimotherwiserelatedtotherelationshipsamongus,ouraffiliatesandtheirrespectiveshareholders,directorsand/orofficers,butexcludingclaims
relatedtoourbusinessorsuchaffiliates.Theforumselectionprovisionalsoprovidesthatoursecurityholdersaredeemedtohaveconsentedtopersonaljurisdiction
intheProvinceofOntarioandtoserviceofprocessontheircounselinanyforeignactioninitiatedinviolationoftheforegoingprovisions.
132
Table of Contents
indemnifiableperson)againstallcosts,chargesandexpenses,includinganamountpaidtosettleanactionorsatisfyajudgment,reasonablyincurredbyhimor
herinrespectofanycivil,criminal,administrativeorotherlegalproceedingorinvestigativeaction(whethercurrent,threatened,pendingorcompleted)inwhichhe
orsheisinvolvedbecauseofthatpersonspositionasanindemnifiableperson,unless:(i)theindividualdidnotacthonestlyandingoodfaithwithaviewtothe
bestinterestsofsuchcompanyortheotherentity,asthecasemaybe;or(ii)inthecaseofaproceedingotherthanacivilproceeding,theindividualdidnothave
reasonablegroundsforbelievingthattheindividualsconductwaslawful.Acompanycannotindemnifyanindemnifiablepersonifitisprohibitedfromdoingso
underitsarticlesorbyapplicablelaw.Acompanymaypay,astheyareincurredinadvanceofthefinaldispositionofaneligibleproceeding,theexpensesactually
andreasonablyincurredbyanindemnifiablepersoninrespectofthatproceedingonlyiftheindemnifiablepersonhasprovidedanundertakingthat,ifitis
ultimatelydeterminedthatthepaymentofexpenseswasprohibited,theindemnifiablepersonwillrepayanyamountsadvanced.Subjecttotheaforementioned
prohibitionsonindemnification,acompanymust,afterthefinaldispositionofaneligibleproceeding,paytheexpensesactuallyandreasonablyincurredbyan
indemnifiablepersoninrespectofsucheligibleproceedingifsuchindemnifiablepersonhasnotbeenreimbursedforsuchexpenses,andwaswhollysuccessful,on
themeritsorotherwise,intheoutcomeofsucheligibleproceedingorwassubstantiallysuccessfulonthemeritsintheoutcomeofsucheligibleproceeding.On
applicationfromanindemnifiableperson,acourtmaymakeanyorderthecourtconsidersappropriateinrespectofaneligibleproceeding,includingthe
indemnificationofpenaltiesimposedorexpensesincurredinanysuchproceedingsandtheenforcementofanindemnificationagreement.Aspermittedbythe
BCBCA,ourarticlesrequireustoindemnifyourdirectors,officers,formerdirectorsorofficers(andsuchindividualsrespectiveheirsandlegalrepresentatives)
andpermitustoindemnifyanypersontotheextentpermittedbytheBCBCA.
Competition Act
LimitationsontheabilitytoacquireandholdoursubordinatevotingsharesandmultiplevotingsharesmaybeimposedbytheCompetition Act (Canada).This
legislationpermitstheCommissionerofCompetition,orCommissioner,toreviewanyacquisitionorestablishment,directlyorindirectly,includingthroughthe
acquisitionofshares,ofcontroloverorofasignificantinterestinus.ThislegislationgrantstheCommissionerjurisdiction,foruptooneyearaftertheacquisition
hasbeensubstantiallycompleted,tochallengethistypeofacquisitionbyseekingaremedialorder,includinganordertoprohibittheacquisitionorrequire
divestitures,fromtheCanadianCompetitionTribunal,whichmaybegrantedwheretheCompetitionTribunalfindsthattheacquisitionsubstantiallypreventsor
lessens,orislikelytosubstantiallypreventorlessen,competition.
Thislegislationalsorequiresanypersonorpersonswhointendtoacquiremorethan20%ofourvotingsharesor,ifsuchpersonorpersonsalreadyownmorethan
20%ofourvotingsharespriortotheacquisition,morethan50%ofourvotingshares,tofileanotificationwiththeCanadianCompetitionBureauifcertain
financialthresholdsareexceeded.Whereanotificationisrequired,unlessanexemptionisavailable,thelegislationprohibitscompletionoftheacquisitionuntilthe
expirationoftheapplicablestatutorywaitingperiod,unlesstheCommissionereitherwaivesorterminatessuchwaitingperiodorissuesanadvanceruling
certificate.TheCommissionersreviewofanotifiabletransactionforsubstantivecompetitionlawconsiderationsmaytakelongerthanthestatutorywaitingperiod.
133
Table of Contents
theacquisitionofoursubordinatevotingsharesandmultiplevotingsharesbyapersonintheordinarycourseofthatpersonsbusinessasatraderor
dealerinsecurities;
theacquisitionofcontrolofusinconnectionwiththerealizationofsecuritygrantedforaloanorotherfinancialassistanceandnotforanypurpose
theacquisitionofcontrolofusbyreasonofanamalgamation,merger,consolidationorcorporatereorganizationfollowingwhichtheultimatedirector
indirectcontrolinfactofus,throughownershipofoursubordinatevotingsharesandmultiplevotingshares,remainsunchanged.
134
Table of Contents
Other
Thereisnolaw,governmentaldecreeorregulationinCanadathatrestrictstheexportorimportofcapital,orthatwouldaffecttheremittanceofdividends(ifany)
orotherpaymentsbyustonon-residentholdersofoursubordinatevotingsharesandmultiplevotingshares,otherthanwithholdingtaxrequirements.
Listing
OursubordinatevotingshareshavebeenapprovedforlistingontheNYSEandconditionallyapprovedforlistingontheTSXunderthesymbolGOOS.Our
subordinatevotingshareswilltradeinU.S.dollarsontheNYSEandinCanadiandollarsontheTSX.
Asdescribedherein,inconnectionwiththisofferingweamendedourarticlesinordertoamendandredesignateourClassACommonSharesasmultiplevoting
sharesandcreateoursubordinatevotingshares.Inaddition,theLegacyOptionPlanhasbeenamendedsuchthatoptionstoacquireClassACommonShares
constituteoptionstopurchaseanequalnumberofsubordinatevotingsharesatthesameexerciseprice.ThetermsandconditionsoftheLegacyOptionPlanare
describedunderExecutiveCompensationEquityIncentivePlansLegacyOptionPlan.
Exercise Price
Number of per Option
Category of Holder Options (1) ($) (1) Expiration Date
Allofourexecutiveofficersandpastexecutiveofficers,asa
group(16intotal) 4,233,300 $ 1.25 FromApril17,2014toApril26,2026
Allofourdirectorsandpastdirectorswhoarenotalso
executiveofficers,asagroup(4intotal) 111,110 $ 8.94 FromFebruary1,2017toFebruary1,2027
Alldirectorsofoursubsidiarieswhoarenotalsoexecutive
officersofthesubsidiary,asagroup(2intotal) 22,222 $ 8.94 FromFebruary1,2017toFebruary1,2027
Allofourotheremployeesandpastemployees,asagroup(11
intotal) 1,533,028 $ 2.03 FromApril17,2014toDecember5,2026
(1) RepresentstheweightedaverageexercisepriceofalloutstandingoptionstopurchaseClassACommonShares,whethervestedorunvested.
Prior Sales
ThefollowingtablesummarizestheissuancebyCanadaGooseHoldingsInc.ofthesecuritiesoftheclassdistributedunderthisprospectusandofsecuritiesthatare
convertibleorexchangeableintosecuritiesoftheclassdistributedunderthisprospectusduringthe12-monthperiodprecedingthedateofthisprospectus.Aspart
oftheRecapitalization,allofouroutstandingClassACommonShares,ClassBCommonShares,ClassASeniorPreferredShares,ClassBSeniorPreferred
Shares,ClassAJuniorPreferredSharesandClassBJuniorPreferredSharesweresubdivided,repurchasedforcancellationorexchanged,asapplicable,andallof
theoutstandingoptionstoacquireClassBCommonSharesandClassAJuniorPreferredSharesundertheLegacyOptionPlanbecameoptionstoacquireClassA
CommonSharesunderthe
135
Table of Contents
LegacyOptionPlan.Inconnectionwiththisoffering,theLegacyOptionPlanhasbeenamendedsuchthatoptionstoacquireClassACommonSharesconstitute
optionstopurchaseanequalnumberofsubordinatevotingsharesatthesameexerciseprice.Oursharecapitalconsistsofanunlimitednumberofmultiplevoting
sharesandsubordinatevotingsharesandanunlimitednumberofpreferredshares,issuableinseries(noneoutstanding).SeeDescriptionofShareCapitaland
Recapitalization.
136
Table of Contents
137
Table of Contents
TheBCBCAdoesnotcontainaprovisioncomparableto
Section251(h)oftheDGCL.
138
Table of Contents
139
Table of Contents
140
Table of Contents
141
Table of Contents
142
Table of Contents
143
Table of Contents
144
Table of Contents
145
Table of Contents
146
Table of Contents
147
Table of Contents
148
Table of Contents
149
Table of Contents
150
Table of Contents
Upontheclosingofthisoffering,wewillhaveoutstanding20,000,000subordinatevotingshares,aftergivingeffecttotheissuanceof6,308,154subordinatevoting
sharesinthisofferingandsalebythesellingshareholdersof13,691,846sharesinthisoffering,assumingnoexercisebytheunderwritersoftheover-allotment
option,andnoexerciseofoptionsoutstandingasofMarch1,2017.Basedonthesameassumptions,upontheclosingofthisoffering,wewillhaveoutstanding
86,308,154multiplevotingshares.Thesubordinatevotingsharesissuableupontheconversionofthemultiplevotingsharesthatwillbeheldbycertainofour
existingshareholdersuponclosingofthisofferingwillbeavailableforsaleinthepublicmarketaftertheexpirationorwaiverofthelock-uparrangements
describedbelow,subjecttolimitationsimposedbyU.S.andCanadiansecuritieslawsonresalebyouraffiliates.
WeexpectthatallofthesubordinatevotingsharestobesoldinthisofferingwillbefreelytradablewithoutrestrictionundertheSecuritiesActunlesspurchasedby
ouraffiliates,asthattermisdefinedinRule144undertheSecuritiesAct.Sharespurchasedbyouraffiliatesmaynotberesoldexceptpursuanttoaneffective
registrationstatementoranexemptionfromregistration,includingthesafeharborunderRule144oftheSecuritiesActdescribedbelow.Inaddition,followingthis
offering,subordinatevotingsharesissuablepursuanttoawardsgrantedundercertainofourequityplansthatareexpectedtobecoveredbyaregistrationstatement
onFormS-8willeventuallybefreelytradableinthepublicmarket,subjecttocertaincontractualandlegalrestrictionsdescribedbelow.
Theremainingmultiplevotingsharesoutstandingafterthisofferingwillberestrictedsecurities,asthattermisdefinedinRule144oftheSecuritiesAct,andwe
expectthatsubstantiallyalloftheserestrictedsecuritieswillbesubjecttothelock-upagreementsdescribedbelow.Thesesubordinatevotingsharesand
subordinatevotingsharesissuableuponconversionofmultiplevotingsharesmaybesoldinthepublicmarketonlyifthesaleisregisteredorpursuanttoan
exemptionfromregistration,suchasthesafeharborprovidedbyRule144,orincompliancewithapplicableCanadianSecuritieslaws.
Lock-up Restrictions
Weandeachofourdirectors,executiveofficersandholdersofallofouroutstandingmultiplevotingshares,haveagreedthat,withoutthepriorwrittenconsentof
certainoftheunderwriters,weandtheywillnot,subjecttolimitedexceptions,directlyorindirectlysellordisposeofanysubordinatevotingsharesormultiple
votingsharesoranysecuritiesconvertibleintoorexchangeableorexercisableforsubordinatevotingsharesormultiplevotingsharesforaperiodof180daysafter
thedateofthisprospectus,unlessextendedpursuanttoitsterms.Thelock-uprestrictionsandspecifiedexceptionsaredescribedinmoredetailunder
Underwriting.
Rule 144
Ingeneral,underRule144,beginning90daysafterthedateofthisprospectus,anypersonwhoisnotouraffiliateandhasheldtheirsharesforatleastsixmonths,
includingtheholdingperiodofanypriorownerotherthanoneofouraffiliates,maysellshareswithoutrestriction,subjecttotheavailabilityofcurrentpublic
informationaboutus.Inaddition,underRule144,anypersonwhoisnotouraffiliateandhasnotbeenouraffiliateatanytimeduringtheprecedingthreemonths
andhasheldtheirsharesforatleastoneyear,includingtheholdingperiodofanypriorownerotherthanoneofouraffiliates,wouldbeentitledtosellanunlimited
numberofsharesimmediatelyupontheclosingofthisofferingwithoutregardtowhethercurrentpublicinformationaboutusisavailable.
151
Table of Contents
Beginning90daysafterthedateofthisprospectus,apersonwhoisouraffiliateorwhowasouraffiliateatanytimeduringtheprecedingthreemonthsandwhohas
beneficiallyownedrestrictedsecuritiesforatleastsixmonths,includingtheholdingperiodofanypriorownerotherthanoneofouraffiliates,isentitledtosella
numberofsubordinatevotingshareswithinanythree-monthperiodthatdoesnotexceedthegreaterof:(i)1%ofthenumberofoursharesoutstanding,whichwill
equalapproximately1.07millionsharesimmediatelyafterthisoffering;and(ii)theaverageweeklytradingvolumeofoursubordinatevotingsharesontheNYSE
duringthefourcalendarweeksprecedingthefilingofanoticeonForm144withrespecttothesale.
SalesunderRule144byouraffiliatesarealsosubjecttocertainmannerofsaleprovisions,noticerequirementsandtotheavailabilityofcurrentpublicinformation
aboutus.
Rule 701
Ingeneral,underRule701undertheSecuritiesAct,beginning90daysafterwebecomesubjecttothepubliccompanyreportingrequirementsoftheExchangeAct,
anyofouremployees,directors,officers,consultantsoradvisorswhoacquiredsubordinatevotingsharesfromusinconnectionwithawrittencompensatorystock
oroptionplanorotherwrittenagreementincompliancewithRule701isentitledtosellsuchsharesinrelianceonRule144butwithoutcompliancewithcertainof
therequirementscontainedinRule144.Accordingly,subjecttoanyapplicablelock-uprestrictions,beginning90daysafterwebecomesubjecttothepublic
companyreportingrequirementsoftheExchangeAct,underRule701personswhoarenotouraffiliatesmayresellthoseshareswithoutcomplyingwiththe
minimumholdingperiodorpublicinformationrequirementsofRule144,andpersonswhoareouraffiliatesmayresellthoseshareswithoutcompliancewith
Rule144sminimumholdingperiodrequirements.
152
Table of Contents
Material United States Federal Income Tax Considerations for U.S. Holders
Subjecttothelimitationsandqualificationsstatedherein,thisdiscussionsetsforthcertainmaterialU.S.federalincometaxconsiderationsrelatingtotheownership
anddispositionbyU.S.Holders(asdefinedbelow)ofthesubordinatevotingshares.ThediscussionisbasedontheU.S.InternalRevenueCodeof1986,as
amended(theCode),itslegislativehistory,existingandproposedregulationsthereunder,publishedrulingsandcourtdecisions,allascurrentlyineffectandall
subjecttochangeatanytime,possiblywithretroactiveeffect.ThissummaryappliesonlytoU.S.Holdersanddoesnotaddresstaxconsequencestoanon-U.S.
Holder(asdefinedbelow)investinginoursubordinatevotingshares.
ThisdiscussionofaU.S.Holderstaxconsequencesaddressesonlythosepersonsthatacquiretheirsubordinatevotingsharesinthisofferingandthatholdthose
subordinatevotingsharesascapitalassetsanddoesnotaddressthetaxconsequencestoanyspecialclassofholders,includingwithoutlimitation,holders(directly,
indirectlyorconstructively)of10%ormoreofourequity(basedonvotingpower),dealersinsecuritiesorcurrencies,banks,tax-exemptorganizations,insurance
companies,financialinstitutions,broker-dealers,regulatedinvestmentcompanies,realestateinvestmenttrusts,tradersinsecuritiesthatelectthemark-to-market
methodofaccountingfortheirsecuritiesholdings,personsthatholdsecuritiesthatareahedgeorthatarehedgedagainstcurrencyorinterestraterisksorthatare
partofastraddle,conversionorintegratedtransaction,U.S.expatriates,partnershipsorotherpass-throughentitiesforU.S.federalincometaxpurposesandU.S.
HolderswhosefunctionalcurrencyforU.S.federalincometaxpurposesisnottheU.S.dollar.ThisdiscussiondoesnotaddresstheeffectoftheU.S.federal
alternativeminimumtax,U.S.federalestateandgifttax,the3.8%Medicarecontributiontaxonnetinvestmentincomeoranystate,localornon-U.S.taxlawsona
holderofsubordinatevotingshares.
Forpurposesofthisdiscussion,aU.S.HolderisabeneficialownerofsubordinatevotingsharesthatisforU.S.federalincometaxpurposes:(a)anindividual
whoisacitizenorresidentoftheUnitedStates;(b)acorporation(orotherentitytaxableasacorporationforU.S.federalincometaxpurposes)createdor
organizedinorunderthelawsoftheUnitedStates,anystatethereofortheDistrictofColumbia;(c)anestatetheincomeofwhichissubjecttoU.S.federalincome
taxationregardlessofitssource;or(d)atrust(i)ifacourtwithintheUnitedStatescanexerciseprimarysupervisionoveritsadministration,andoneormoreU.S.
personshavetheauthoritytocontrolallofthesubstantialdecisionsofthattrust,or(ii)thathasavalidelectionineffectunderapplicableTreasuryregulationstobe
treatedasaU.S.person.Thetermnon-U.S.HoldermeansanybeneficialownerofoursubordinatevotingsharesthatisnotaU.S.Holder,apartnership(oran
entityorarrangementthatistreatedasapartnershiporotherpass-throughentityforU.S.federalincometaxpurposes)orapersonholdingoursubordinatevoting
sharesthroughsuchanentityorarrangement.
IfapartnershiporanentityorarrangementthatistreatedasapartnershipforU.S.federalincometaxpurposesholdsoursubordinatevotingshares,thetax
treatmentofapartnerwillgenerallydependuponthestatusofthepartnerandtheactivitiesofthepartnership.Partnersinpartnershipsthatholdoursubordinate
votingsharesshouldconsulttheirowntaxadvisors.
You are urged to consult your own independent tax advisor regarding the specific U.S. federal, state, local and non-U.S. income and other tax
considerations relating to the ownership and disposition of our subordinate voting shares.
153
Table of Contents
Canadiantaxeswithheld,ifany)asdividendincometotheextentofourcurrentoraccumulatedearningsandprofits(computedusingU.S.federalincometax
principles),withtheexcesstreatedasanon-taxablereturnofcapitaltotheextentoftheholdersadjustedtaxbasisinitssubordinatevotingsharesand,thereafter,
ascapitalgainrecognizedonasaleorexchangeonthedayactuallyorconstructivelyreceivedbyyou.Therecanbenoassurancethatwewillmaintaincalculations
ofourearningsandprofitsinaccordancewithU.S.federalincometaxaccountingprinciples.U.S.Holdersshouldthereforeassumethatanydistributionwith
respecttooursubordinatevotingshareswillconstituteordinarydividendincome.Dividendspaidonthesubordinatevotingshareswillnotbeeligibleforthe
dividendsreceiveddeductionallowedtoU.S.corporations.
Dividendspaidtoanon-corporateU.S.Holderbyaqualifiedforeigncorporationmaybesubjecttoreducedratesoftaxationifcertainholdingperiodandother
requirementsaremet.Aqualifiedforeigncorporationgenerallyincludesaforeigncorporation(otherthanaPFIC)if(i)itssubordinatevotingsharesarereadily
tradableonanestablishedsecuritiesmarketintheUnitedStatesor(ii)itiseligibleforbenefitsunderacomprehensiveU.S.incometaxtreatythatincludesan
exchangeofinformationprogramandwhichtheU.S.TreasuryDepartmenthasdeterminedissatisfactoryforthesepurposes.Oursubordinatevotingsharesare
expectedtobereadilytradableonanestablishedsecuritiesmarket,theNYSE.U.S.Holdersshouldconsulttheirowntaxadvisorsregardingtheavailabilityofthe
reducedtaxrateondividendsinlightoftheirparticularcircumstances.
Non-corporateU.S.HolderswillnotbeeligibleforreducedratesoftaxationonanydividendsreceivedfromusifweareaPFICinthetaxableyearinwhichsuch
dividendsarepaidorintheprecedingtaxableyear.
DistributionspaidinacurrencyotherthanU.S.dollarswillbeincludedinaU.S.HoldersgrossincomeinaU.S.dollaramountbasedonthespotexchangeratein
effectonthedateofactualorconstructivereceipt,whetherornotthepaymentisconvertedintoU.S.dollarsatthattime.TheU.S.Holderwillhaveataxbasisin
suchcurrencyequaltosuchU.S.dollaramount,andanygainorlossrecognizeduponasubsequentsaleorconversionoftheforeigncurrencyforadifferentU.S.
dollaramountwillbeU.S.sourceordinaryincomeorloss.IfthedividendisconvertedintoU.S.dollarsonthedateofreceipt,aU.S.Holdergenerallyshouldnot
berequiredtorecognizeforeigncurrencygainorlossinrespectofthedividendincome.
AU.S.Holderwhopays(whetherdirectlyorthroughwithholding)Canadiantaxeswithrespecttodividendspaidonoursubordinatevotingsharesmaybeentitled
toreceiveeitheradeductionoraforeigntaxcreditforsuchCanadiantaxespaid.Complexlimitationsapplytotheforeigntaxcredit,includingthegeneral
limitationthatthecreditcannotexceedtheproportionateshareofaU.S.HoldersU.S.federalincometaxliabilitythatsuchU.S.Holdersforeignsourcetaxable
incomebearstosuchU.S.Holdersworldwidetaxableincome.Inapplyingthislimitation,aU.S.Holdersvariousitemsofincomeanddeductionmustbe
classified,undercomplexrules,aseitherforeignsourceorU.S.source.Inaddition,thislimitationiscalculatedseparatelywithrespecttospecificcategoriesof
income.Dividendspaidbyusgenerallywillconstituteforeignsourceincomeandgenerallywillbecategorizedaspassivecategoryincome.However,if50%
ormoreofourequity(basedonvotingpowerorvalue)istreatedasheldbyU.S.persons,wewillbetreatedasaUnitedStates-ownedforeigncorporation,in
whichcasedividendsmaybetreatedforforeigntaxcreditlimitationpurposesasforeignsourceincometotheextentattributabletoournon-U.S.sourceearnings
andprofitsandasU.S.sourceincometotheextentattributabletoourU.S.sourceearningsandprofits.Becausetheforeigntaxcreditrulesarecomplex,each
U.S.Holdershouldconsultitsowntaxadvisorregardingtheforeigntaxcreditrules.
154
Table of Contents
taxpayeroranelectingaccrualbasistaxpayer,thespotexchangerateineffectonthesettlementdate)andtheU.S.Holdersadjustedtaxbasisinthesubordinate
votingsharesdeterminedinU.S.dollars.TheinitialtaxbasisofthesubordinatevotingsharestoaU.S.HolderwillbetheU.S.HoldersU.S.dollarpurchaseprice
forthesubordinatevotingshares(determinedbyreferencetothespotexchangerateineffectonthedateofthepurchase,orifthesubordinatevotingshares
purchasedaretradedonanestablishedsecuritiesmarketandtheU.S.Holderisacashbasistaxpayeroranelectingaccrualbasistaxpayer,thespotexchangeratein
effectonthesettlementdate).
AssumingwearenotaPFICandhavenotbeentreatedasaPFICduringyourholdingperiodforoursubordinatevotingshares,suchgainorlosswillbecapital
gainorlossandwillbelong-termgainorlossifthesubordinatevotingshareshavebeenheldformorethanoneyear.Undercurrentlaw,long-termcapitalgainsof
non-corporateU.S.Holdersgenerallyareeligibleforreducedratesoftaxation.Thedeductibilityofcapitallossesissubjecttolimitations.Capitalgainorloss,if
any,recognizedbyaU.S.HoldergenerallywillbetreatedasU.S.sourceincomeorlossforU.S.foreigntaxcreditpurposes.U.S.Holdersareencouragedto
consulttheirowntaxadvisorsregardingtheavailabilityoftheU.S.foreigntaxcreditintheirparticularcircumstances.
Passiveincomegenerallyincludesdividends,interest,rentsandroyalties(otherthancertainrentsandroyaltiesderivedintheactiveconductofatradeorbusiness),
annuitiesandgainsfromassetsthatproducepassiveincome.Ifanon-U.S.corporationownsatleast25%byvalueofthestockofanothercorporation,thenon-U.S.
corporationistreatedforpurposesofthePFICtestsasowningitsproportionateshareoftheassetsoftheothercorporationandasreceivingdirectlyits
proportionateshareoftheothercorporationsincome.
Additionally,ifweareclassifiedasaPFICinanytaxableyearwithrespecttowhichaU.S.Holderownssubordinatevotingshares,wegenerallywillcontinueto
betreatedasaPFICwithrespecttosuchU.S.Holderinallsucceedingtaxableyears,regardlessofwhetherwecontinuetomeetthetestsdescribedabove,unless
theU.S.Holdermakesthedeemedsaleelectiondescribedbelow.
WedonotbelievethatwearecurrentlyaPFIC,andwedonotanticipatebecomingaPFICintheforeseeablefuture.Notwithstandingtheforegoing,the
determinationofwhetherweareaPFICismadeannuallyanddependsontheparticularfactsandcircumstances(suchasthevaluationofourassets,including
goodwillandotherintangibleassets)andalsomaybeaffectedbytheapplicationofthePFICrules,whicharesubjecttodifferinginterpretations.Thefairmarket
valueofourassetsisexpectedtodepend,inpart,upon(a)themarketpriceofoursubordinatevotingshares,whichislikelytofluctuate,and(b)thecompositionof
ourincomeandassets,whichwillbeaffectedbyhow,andhowquickly,wespendanycashthatisraisedinanyfinancingtransaction,includingthisoffering.In
lightoftheforegoing,noassurancecanbeprovidedthatwearenotcurrentlyaPFICorthatwewillnotbecomeaPFICinanyfuturetaxableyear.Prospective
investorsshouldconsulttheirowntaxadvisorsregardingourpotentialPFICstatus.
155
Table of Contents
generallywillbesubjecttoadverserules(regardlessofwhetherwecontinuetobeclassifiedasaPFIC)withrespectto(i)anyexcessdistributions(generally,any
distributionsreceivedbytheU.S.Holderonitssubordinatevotingsharesinataxableyearthataregreaterthan125%oftheaverageannualdistributionsreceived
bytheU.S.Holderinthethreeprecedingtaxableyearsor,ifshorter,theU.S.Holdersholdingperiodforitssubordinatevotingshares)and(ii)anygainrealized
onthesaleorotherdisposition,includingapledge,ofitssubordinatevotingshares.
Undertheseadverserules(a)theexcessdistributionorgainwillbeallocatedratablyovertheU.S.Holdersholdingperiod,(b)theamountallocatedtothecurrent
taxableyearandanytaxableyearpriortothefirsttaxableyearinwhichweareclassifiedasaPFICwillbetaxedasordinaryincomeand(c)theamountallocated
toeachothertaxableyearduringtheU.S.HoldersholdingperiodinwhichwewereclassifiedasaPFIC(i)willbesubjecttotaxatthehighestrateoftaxineffect
fortheapplicablecategoryoftaxpayerforthatyearand(ii)willbesubjecttoaninterestchargeatastatutoryratewithrespecttotheresultingtaxattributableto
eachsuchothertaxableyear.
IfweareclassifiedasaPFIC,aU.S.Holderwillgenerallybetreatedasowningaproportionateamount(byvalue)ofstockorsharesownedbyusinanydirector
indirectsubsidiariesthatarealsoPFICsandwillbesubjecttosimilaradverseruleswithrespecttoanydistributionswereceivefrom,anddispositionswemakeof,
thestockorsharesofsuchsubsidiaries.YouareurgedtoconsultyourtaxadvisorsabouttheapplicationofthePFICrulestoanyofoursubsidiaries.
IfweareclassifiedasaPFICandthenceasetobesoclassified,aU.S.Holdermaymakeanelection(adeemedsaleelection)tobetreatedforU.S.federal
incometaxpurposesashavingsoldsuchU.S.HolderssubordinatevotingsharesonthelastdayourtaxableyearduringwhichwewereaPFIC.AU.S.Holderthat
makesadeemedsaleelectionwouldthenceasetobetreatedasowningstockinaPFICbyreasonofownershipofoursubordinatevotingshares.However,gain
recognizedasaresultofmakingthedeemedsaleelectionwouldbesubjecttotheadverserulesdescribedaboveandlosswouldnotberecognized.
AU.S.Holderthatmakesamark-to-marketelectionmustincludeingrossincome,asordinaryincome,foreachtaxableyearthatweareaPFICanamountequalto
theexcess,ifany,ofthefairmarketvalueoftheU.S.HolderssubordinatevotingsharesatthecloseofthetaxableyearovertheU.S.Holdersadjustedtaxbasisin
itssubordinatevotingshares.AnelectingU.S.Holdermayalsoclaimanordinarylossdeductionfortheexcess,ifany,oftheU.S.Holdersadjustedtaxbasisinits
subordinatevotingsharesoverthefairmarketvalueofitssubordinatevotingsharesatthecloseofthetaxableyear,butthisdeductionisallowableonlytothe
extentofanynetmark-to-marketgainspreviouslyincludedinincome.AU.S.Holderthatmakesamark-to-marketelectiongenerallywilladjustsuchU.S.
Holderstaxbasisinitssubordinatevotingsharestoreflecttheamountincludedingrossincomeorallowedasadeductionbecauseofsuchmark-to-market
election.GainsfromanactualsaleorotherdispositionofsubordinatevotingsharesinayearinwhichweareaPFICwillbetreatedasordinaryincome,andany
lossesincurredonasaleorotherdispositionofsubordinatevotingshareswillbetreatedasordinarylossestotheextentofanynetmark-to-marketgainspreviously
includedinincome.
IfweareclassifiedasaPFICforanytaxableyearinwhichaU.S.Holderownssubordinatevotingsharesbutbeforeamark-to-marketelectionismade,theadverse
PFICrulesdescribedabovewillapplytoanymark-to-
156
Table of Contents
marketgainrecognizedintheyeartheelectionismade.Otherwise,amark-to-marketelectionwillbeeffectiveforthetaxableyearforwhichtheelectionismade
andallsubsequenttaxableyears.TheelectioncannotberevokedwithouttheconsentoftheInternalRevenueService(IRS)unlessthesubordinatevotingshares
ceasetobemarketable,inwhichcasetheelectionisautomaticallyterminated.
Amark-to-marketelectionisnotpermittedforthesharesofanyofoursubsidiariesthatarealsoclassifiedasPFICs.Prospectiveinvestorsshouldconsulttheirown
taxadvisorsregardingtheavailabilityof,andtheprocedureformaking,amark-to-marketelection.
NOASSURANCECANBEGIVENTHATWEARENOTCURRENTLYAPFICORTHATWEWILLNOTBECOMEAPFICINTHEFUTURE.U.S.
HOLDERSSHOULDCONSULTTHEIROWNTAXADVISORSWITHRESPECTTOTHEOPERATIONOFTHEPFICRULESANDRELATED
REPORTINGREQUIREMENTSINLIGHTOFTHEIRPARTICULARCIRCUMSTANCES,INCLUDINGTHEADVISABILITYOFMAKINGANY
ELECTIONTHATMAYBEAVAILABLE.
U.S.Holdersthatowncertainforeignfinancialassets(whichmayincludethesubordinatevotingshares)arerequiredtoreportinformationrelatingtosuchassets,
subjecttocertainexceptions,onIRSForm8938.Inadditiontotheserequirements,U.S.HoldersmayberequiredtoannuallyfileFinCENReport114,Reportof
ForeignBankandFinancialAccounts(FBAR)withtheU.S.DepartmentofTreasury.U.S.Holdersshouldconsulttheirowntaxadvisorsregardingthe
applicabilityofFBARandotherreportingrequirementsinlightoftheirindividualcircumstances.
157
Table of Contents
THE ABOVE DISCUSSION DOES NOT COVER ALL TAX MATTERS THAT MAY BE OF IMPORTANCE TO A PARTICULAR INVESTOR. YOU
ARE STRONGLY URGED TO CONSULT YOUR OWN TAX ADVISOR ABOUT THE TAX CONSEQUENCES TO YOU OF AN INVESTMENT IN
THE SUBORDINATE VOTING SHARES.
158
Table of Contents
ThissummaryisbasedonthecurrentprovisionsoftheCanadianTaxAct,andanunderstandingofthecurrentadministrativepoliciesoftheCanadaRevenue
Agency(CRA)publishedinwritingpriortothedatehereof.ThissummarytakesintoaccountallspecificproposalstoamendtheCanadianTaxActandthe
Canada-UnitedStatesTaxConvention(1980),asamended(theCanada-U.S.TaxTreaty)publiclyannouncedbyoronbehalfoftheMinisterofFinance(Canada)
priortothedatehereof(theProposedAmendments)andassumesthatallProposedAmendmentswillbeenactedintheformproposed.However,noassurances
canbegiventhattheProposedAmendmentswillbeenactedasproposed,oratall.Thissummarydoesnototherwisetakeintoaccountoranticipateanychangesin
laworadministrativepolicyorassessingpracticewhetherbylegislative,regulatory,administrativeorjudicialactionnordoesittakeintoaccounttaxlegislationor
considerationsofanyprovince,territoryorforeignjurisdiction,whichmaydifferfromthosediscussedherein.
Thissummaryisofageneralnatureonlyandisnot,andisnotintendedtobe,legalortaxadvicetoanyparticularshareholder.Thissummaryisnotexhaustiveof
allCanadianfederalincometaxconsiderations.Accordingly,youshouldconsultyourowntaxadvisorwithrespecttoyourparticularcircumstances.
Generally,forpurposesoftheCanadianTaxAct,allamountsrelatingtotheacquisition,holdingordispositionofthesubordinatevotingsharesmustbeconverted
intoCanadiandollarsbasedontheexchangeratesasdeterminedinaccordancewiththeCanadianTaxAct.Theamountofanydividendsrequiredtobeincludedin
theincomeof,andcapitalgainsorcapitallossesrealizedby,aNon-CanadianHoldermaybeaffectedbyfluctuationsintheCanadianexchangerate.
Dividends
DividendspaidorcreditedonthesubordinatevotingsharesordeemedtobepaidorcreditedonthesubordinatevotingsharestoaNon-CanadianHolderwillbe
subjecttoCanadianwithholdingtaxattherateof25%,subjecttoanyreductionintherateofwithholdingtowhichtheNon-CanadianHolderisentitledunderany
applicableincometaxconventionbetweenCanadaandthecountryinwhichtheNon-CanadianHolderisresident.Forexample,undertheCanada-U.S.TaxTreaty,
wheredividendsonthesubordinatevotingsharesareconsideredtobepaidtoorderivedbyaNon-CanadianHolderthatisabeneficialownerofthedividendsand
isaU.S.residentforthepurposesof,andisentitledtobenefitsof,theCanada-U.S.TaxTreaty,theapplicablerateofCanadianwithholdingtaxisgenerally
reducedto15%.
Dispositions
ANon-CanadianHolderwillnotbesubjecttotaxundertheCanadianTaxActonanycapitalgainrealizedonadispositionordeemeddispositionofasubordinate
votingshare,unlessthesubordinatevotingsharesaretaxableCanadianpropertytotheNon-CanadianHolderforpurposesoftheCanadianTaxActandtheNon-
CanadianHolderisnotentitledtoreliefunderanapplicableincometaxconventionbetweenCanadaandthecountryinwhichtheNon-CanadianHolderisresident.
159
Table of Contents
Generally,thesubordinatevotingshareswillnotconstitutetaxableCanadianpropertytoaNon-CanadianHolderataparticulartimeprovidedthatthe
subordinatevotingsharesarelistedatthattimeonadesignatedstockexchange(asdefinedintheCanadianTaxAct),whichincludestheNYSEandtheTSX,
unlessatanyparticulartimeduringthe60-monthperiodthatendsatthattime(i)oneoranycombinationof(a)theNon-CanadianHolder,(b)personswithwhom
theNon-CanadianHolderdoesnotdealatarmslength,and(c)partnershipsinwhichtheNon-CanadianHolderorapersondescribedin(b)holdsamembership
interestdirectlyorindirectlythroughoneormorepartnerships,hasowned25%ormoreoftheissuedsharesofanyclassorseriesofourcapitalstock,and(ii)more
than50%ofthefairmarketvalueofthesubordinatevotingshareswasderived,directlyorindirectly,fromoneoranycombinationof:(i)realorimmoveable
propertysituatedinCanada,(ii)Canadianresourceproperties(asdefinedintheCanadianTaxAct),(iii)timberresourceproperties(asdefinedintheCanadian
TaxAct)and(iv)optionsinrespectof,orinterestsin,orforcivillawrightsin,propertyinanyoftheforegoingwhetherornotthepropertyexists.Notwithstanding
theforegoing,incertaincircumstancessetoutintheCanadianTaxAct,subordinatevotingsharescouldbedeemedtobetaxableCanadianproperty.Non-
Canadian Holders whose subordinate voting shares may constitute taxable Canadian property should consult their own tax advisors .
160
Table of Contents
Underwriting
Thecompany,thesellingshareholdersandtheunderwritersnamedbelowhaveenteredintoanunderwritingagreementdatedMarch15,2017withrespecttothe
subordinatevotingsharesbeingoffered.Subjecttocertainconditions,eachunderwriterhasseverallyagreedtopurchasethenumberofsubordinatevotingshares
indicatedinthefollowingtableatapriceof$17.00persharepayableincashontheclosingdateofthisoffering.CIBCWorldMarketsInc.,CreditSuisse
Securities(USA)LLC,Goldman,Sachs&Co.andRBCCapitalMarkets,LLCaretherepresentativesoftheunderwriters.
Underwriters NumberofShares
CIBCWorldMarketsInc. 3,702,558
CreditSuisseSecurities(USA)LLC 3,702,558
Goldman,Sachs&Co. 3,702,558
RBCCapitalMarkets,LLC 2,538,896
MerrillLynch,Pierce,Fenner&Smith
Incorporated 1,166,089
MorganStanley&Co.LLC 1,166,089
BarclaysCapitalInc. 777,393
BMONesbittBurnsInc. 777,393
TDSecuritiesInc. 777,393
WellsFargoSecurities,LLC 777,393
CanaccordGenuityInc. 455,840
RobertW.Baird&Co.Incorporated*
455,840
Total 20,000,000
* RobertW.Baird&Co.IncorporatedanditsaffiliatesarenotregisteredtosellsecuritiesinanyCanadianjurisdictionand,accordingly,willonlysellsubordinate
votingsharesoutsideofCanada.
TheofferingisbeingmadeconcurrentlyintheUnitedStatesandineachoftheprovincesandterritoriesofCanada.Thesubordinatevotingshareswillbeofferedin
theUnitedStatesthroughthoseunderwriterswhoareregisteredtoofferthesubordinatevotingsharesforthesaleintheUnitedStatesandsuchotherregistered
dealersasmaybedesignatedbytheunderwriters.ThesubordinatevotingshareswillbeofferedineachoftheprovincesandterritoriesofCanadathroughthose
underwritersortheirCanadianaffiliateswhoareregisteredtoofferthesubordinatevotingsharesforsaleinsuchprovincesandterritoriesandsuchotherregistered
dealersasmaybedesignatedbytheunderwriters.Subjecttoapplicablelaw,theunderwriters,orsuchotherregistereddealersasmaybedesignatedbythe
underwriters,mayofferthesubordinatevotingsharesoutsideoftheUnitedStatesandCanada.
Theobligationsoftheunderwritersundertheunderwritingagreementaresubjecttocustomaryconditions,includingthedeliveryofcertaindocumentsandlegal
opinionsandtheconditionthatthereshallnothaveoccurredanyofthefollowing:(i)asuspensionormateriallimitationintradinginsecuritiesgenerallyonthe
NYSEandtheTSX;(ii)asuspensionormateriallimitationintradinginoursecuritiesontheNYSEandtheTSX;(iii)ageneralmoratoriumoncommercial
bankingactivitiesintheUnitedStatesorCanadadeclaredbytherelevantauthorities,oramaterialdisruptionincommercialbankingorsecuritiessettlementor
clearanceservicesintheUnitedStatesorCanada;(iv)theoutbreakorescalationofhostilitiesinvolvingtheUnitedStatesorCanadaorthedeclarationbythe
UnitedStatesorCanadaofanationalemergencyorwar;or(v)theoccurrenceofanyothercalamityorcrisisoranychangeinfinancial,politicaloreconomic
conditionsintheUnitedStatesorCanadaorelsewhere,iftheeffectofanysucheventspecifiedinclause(iv)or(v)intheunderwritersjudgmentmakesit
impracticableorinadvisabletoproceedwithourinitialpublicofferingorthedeliveryofoursubordinatevotingshares.Theunderwriters,however,areobligatedto
takeandpayforallofthesubordinatevotingsharesbeingoffered,ifanyaretaken,otherthanthesubordinatevotingsharescoveredbytheoptiondescribedbelow
unlessanduntilthisoptionisexercised.
161
Table of Contents
Theunderwritershaveanoptiontobuyuptoanadditional3,000,000subordinatevotingsharesfromcertainofthesellingshareholderstocoversalesbythe
underwritersofagreaternumberofsubordinatevotingsharesthanthetotalnumbersetforthinthetableabove.Theymayexercisethatoptionfor30days.Ifany
subordinatevotingsharesarepurchasedpursuanttothisoption,theunderwriterswillseverallypurchasesubordinatevotingsharesinapproximatelythesame
proportionassetforthinthetableabove.Ifanyadditionalsubordinatevotingsharesarepurchased,theunderwriterswilloffertheadditionalsubordinatevoting
sharesonthesametermsasthoseonwhichthesubordinatevotingsharesarebeingofferedunderthisprospectus.
Thefollowingtablesshowthepershareandtotalunderwritingcommissionstobepaidtotheunderwritersbythecompanyandthesellingshareholders.Wehave
agreedtoreimbursetheunderwritersforcertainoftheirexpensesinanamountupto$40,000assetforthintheunderwritingagreement.Suchamountsareshown
assumingbothnoexerciseandfullexerciseoftheunderwritersover-allotmentoption.
PaidbytheCompany
NoExercise FullExercise
Persubordinatevotingshare $ 1.1475 $ 1.1475
Total $ 7,238,607 $ 7,238,607
PaidbytheSellingShareholders
NoExercise FullExercise
Persubordinatevotingshare $ 1.1475 $ 1.1475
Total $ 15,711,393 $ 19,153,893
Subordinatevotingsharessoldbytheunderwriterstothepublicwillinitiallybeofferedattheinitialpublicofferingpricesetforthonthecoverofthis
prospectus.Anysharessoldbytheunderwriterstosecuritiesdealersmaybesoldatadiscountofupto$0.68850persharefromtheinitialpublicofferingprice.
Aftertheunderwritershavemadeareasonableefforttosellallofthesharesofferedbythisprospectusattheinitialpublicofferingpricestatedonthecoverpageof
thisprospectus,theunderwritersmaydecreasetheofferingpricefromtimetotime,andthecompensationrealizedbytheunderwriterswillbedecreasedbythe
amountthattheaggregatepricepaidbythepurchasersforthesharesislessthanthegrossproceedspaidbytheunderwriterstousandthesellingshareholders.The
offeringofthesharesbytheunderwritersissubjecttoreceiptandacceptanceandsubjecttotheunderwritersrighttorejectanyorderinwholeorinpart,andthe
rightisreservedtoclosethesubscriptionbooksatanytimewithoutnotice.
Thecompany,itsofficers,directors,andholdersofsubstantiallyallofthecompanyssharespriortothecompletionofthisoffering,includingtheselling
shareholders,haveagreedwiththeunderwriters,subjecttocertainexceptions,nottodisposeoforhedgeanyoftheirsubordinatevotingsharesormultiplevoting
sharesorsecuritiesconvertibleintoorexchangeableforsubordinatevotingsharesormultiplevotingsharesduringtheperiodfromthedateofthisprospectus
continuingthroughthedate180daysafterthedateofthisprospectus,exceptwiththepriorwrittenconsentoftherepresentatives.Thisagreementdoesnotapplyto
anyexistingemployeebenefitplans.SeeSharesEligibleforFutureSaleforadiscussionofcertaintransferrestrictions.
Atourrequest,theunderwritershavereserveduptofivepercentofsubordinatevotingsharestobesoldbyusandthesellingshareholdersandofferedbythis
prospectusforsale,atthepublicofferingprice,tocertainindividuals,throughadirectedshareprogram,includingemployees,directorsandotherpersons
associatedwithuswhohaveexpressedaninterestinpurchasingsharesintheoffering.Thenumberofsubordinatevotingsharesavailableforsaletothegeneral
publicwillbereducedbythenumberofreservedsharessoldtotheseindividuals.Anyreservedsharesnotpurchasedbytheseindividualswillbeofferedbythe
underwriterstothegeneralpubliconthesamebasisastheothersubordinatevotingsharesofferedunderthisprospectus.
162
Table of Contents
Priortotheoffering,therehasbeennopublicmarketforthesubordinatevotingshares.Theinitialpublicofferingpricehasbeennegotiatedamongthecompany
andtherepresentatives.Amongthefactorstobeconsideredindeterminingtheinitialpublicofferingpriceofthesubordinatevotingshares,inadditionto
prevailingmarketconditions,willbethecompanyshistoricalperformance,estimatesofthebusinesspotentialandearningsprospectsofthecompany,an
assessmentofthecompanysmanagementandtheconsiderationoftheabovefactorsinrelationtomarketvaluationofcompaniesinrelatedbusinesses.
OursubordinatevotingshareshavebeenapprovedforlistingontheNYSEintheUnitedStatesandconditionallyapprovedforlistingontheTSXunderthesymbol
GOOS.
Inconnectionwiththeoffering,theunderwritersmaypurchaseandsellsubordinatevotingsharesintheopenmarket.Thesetransactionsmayincludeshortsales,
stabilizingtransactionsandpurchasestocoverpositionscreatedbyshortsales.Shortsalesinvolvethesalebytheunderwritersofagreaternumberofsharesthan
theyarerequiredtopurchaseintheoffering,andashortpositionrepresentstheamountofsuchsalesthathavenotbeencoveredbysubsequentpurchases.A
coveredshortpositionisashortpositionthatisnotgreaterthantheamountofadditionalsharesforwhichtheunderwritersoptiondescribedabovemaybe
exercised.Theunderwritersmaycoveranycoveredshortpositionbyeitherexercisingtheiroptiontopurchaseadditionalsharesorpurchasingsubordinatevoting
sharesintheopenmarket.Indeterminingthesourceofsubordinatevotingsharestocoverthecoveredshortposition,theunderwriterswillconsider,amongother
things,thepriceofsubordinatevotingsharesavailableforpurchaseintheopenmarketascomparedtothepriceatwhichtheymaypurchaseadditionalsubordinate
votingsharespursuanttotheoptiondescribedabove.Nakedshortsalesareanyshortsalesthatcreateashortpositiongreaterthantheamountofadditionalshares
forwhichtheoptiondescribedabovemaybeexercised.Theunderwritersmustcoveranysuchnakedshortpositionbypurchasingsubordinatevotingsharesinthe
openmarket.Anakedshortpositionismorelikelytobecreatediftheunderwritersareconcernedthattheremaybedownwardpressureonthepriceofthe
subordinatevotingsharesintheopenmarketafterpricingthatcouldadverselyaffectinvestorswhopurchaseintheoffering.Stabilizingtransactionsconsistof
variousbidsfororpurchasesofsubordinatevotingsharesmadebytheunderwritersintheopenmarketpriortothecompletionoftheoffering.
Anynakedshortpositionwouldformpartoftheunderwritersover-allocationpositionandapurchaserwhoacquiressubordinatevotingsharesformingpartofthe
underwritersover-allocationpositionacquiressuchsubordinatevotingsharesunderthisprospectus,regardlessofwhethertheover-allocationpositionisultimately
filledthroughtheexerciseoftheunderwritersoptiontopurchaseadditionalsubordinatevotingsharesorsecondarymarketpurchases.
Theunderwritersmayalsoimposeapenaltybid.Thisoccurswhenaparticularunderwriterrepaystotheunderwritersaportionoftheunderwritingcommissions
receivedbyitbecausetherepresentativeshaverepurchasedsubordinatevotingsharessoldbyorfortheaccountofsuchunderwriterinstabilizingorshortcovering
transactions.
InaccordancewithrulesandpolicystatementsofcertainCanadiansecuritiesregulatoryauthoritiesandtheUniversalMarketIntegrityRulesforCanadian
Marketplaces(UMIR),theunderwritersmaynot,atanytimeduringtheperiodofdistribution,bidfororpurchasesubordinatevotingshares.Theforegoing
restrictionis,however,subjecttoexceptionsaspermittedbysuchrulesandpolicystatementsandUMIR.Theseexceptionsincludeabidorpurchasepermitted
undersuchrulesandpolicystatementsandUMIR,relatingtomarketstabilizationandmarketbalancingactivitiesandabidorpurchaseonbehalfofacustomer
wheretheorderwasnotsolicited.
Purchasestocoverashortpositionandstabilizingtransactions,aswellasotherpurchasesbytheunderwritersfortheirownaccounts,mayhavetheeffectof
preventingorretardingadeclineinthemarketpriceofthecompanyssubordinatevotingshares,andtogetherwiththeimpositionofthepenaltybid,maystabilize,
maintainorotherwiseaffectthemarketpriceofthesubordinatevotingshares.Asaresult,thepriceofthesubordinatevoting
163
Table of Contents
sharesmaybehigherthanthepricethatotherwisemightexistintheopenmarket.Theunderwritersarenotrequiredtoengageintheseactivitiesandmayendany
oftheseactivitiesatanytime.ThesetransactionsmaybeeffectedontheNYSE,TSX,intheover-the-countermarketorotherwise.
CertainoftheunderwritersarenotU.S.-registeredbroker-dealersand,therefore,totheextentthattheyintendtoeffectanysalesofthesecuritiesintheUnited
States,theywilldosothroughoneormoreU.S.registeredbroker-dealers,whichmaybeaffiliatesofsuchunderwriters,inaccordancewiththeapplicableU.S.
securitieslawsandregulations.
Selling Restrictions
OtherthanintheUnitedStatesandeachoftheCanadianprovincesandterritories,noactionhasbeentakenbyusortheunderwritersthatwouldpermitapublic
offeringofthesubordinatevotingsharesofferedbythisprospectusinanyjurisdictionwhereactionforthatpurposeisrequired.Thesubordinatevotingshares
offeredbythisprospectusmaynotbeofferedorsold,directlyorindirectly,normaythisprospectusoranyotherofferingmaterialoradvertisementsinconnection
withtheofferandsaleofanysuchsubordinatevotingsharesbedistributedorpublishedinanyjurisdiction,exceptundercircumstancesthatwillresultin
compliancewiththeapplicablerulesandregulationsofthatjurisdiction.Personsintowhosepossessionthisprospectuscomesareadvisedtoinformthemselves
aboutandtoobserveanyrestrictionsrelatingtotheofferingandthedistributionofthisprospectus.Thisprospectusdoesnotconstituteanoffertosellora
solicitationofanoffertobuyanysubordinatevotingsharesofferedbythisprospectusinanyjurisdictioninwhichsuchanofferorasolicitationisunlawful.
(a) toanylegalentitywhichisaqualifiedinvestorasdefinedintheProspectusDirective;
(b) tofewerthan100or,iftheRelevantMemberStatehasimplementedtherelevantprovisionofthe2010PDAmendingDirective,150,naturalorlegalpersons
(otherthanqualifiedinvestorsasdefinedintheProspectusDirective),aspermittedundertheProspectusDirective,subjecttoobtainingthepriorconsentof
therepresentativesforanysuchoffer;or
(c) inanyothercircumstancesfallingwithinArticle3(2)oftheProspectusDirective,providedthatnosuchofferofoursubordinatevotingsharesshallresultin
arequirementforthepublicationbyusoranyunderwriterofaprospectuspursuanttoArticle3oftheProspectusDirective.
Forthepurposesofthisprovision,theexpressionanoffertothepublicinrelationtoanyofoursubordinatevotingsharesinanyRelevantMemberStatemeans
thecommunicationinanyformandbyanymeansofsufficientinformationonthetermsoftheofferandanyofoursubordinatevotingsharestobeofferedsoasto
enableaninvestortodecidetopurchaseanyofoursubordinatevotingshares,asthesamemaybevariedinthatMemberStatebyanymeasureimplementingthe
ProspectusDirectiveinthatMemberState,theexpressionProspectusDirectivemeansDirective2003/71/EC(andamendmentsthereto,includingthe2010PD
AmendingDirective,totheextentimplementedintheRelevantMemberState),andincludesanyrelevantimplementingmeasureintheRelevantMemberState,
andtheexpression2010PDAmendingDirectivemeansDirective2010/73/EU.
164
Table of Contents
United Kingdom
Eachunderwriterhasrepresentedandagreedthat:
(a) ithasonlycommunicatedorcausedtobecommunicatedandwillonlycommunicateorcausetobecommunicatedaninvitationorinducementtoengagein
investmentactivity(withinthemeaningofSection21oftheFinancialServicesandMarketsAct2000(FSMA)receivedbyitinconnectionwiththeissue
orsaleofoursubordinatevotingsharesincircumstancesinwhichSection21(1)oftheFSMAdoesnotapplytous;and
(b) ithascompliedandwillcomplywithallapplicableprovisionsoftheFSMAwithrespecttoanythingdonebyitinrelationtooursubordinatevotingshares
in,fromorotherwiseinvolvingtheUnitedKingdom.
Switzerland
ThesubordinatevotingsharesmaynotbepubliclyofferedinSwitzerlandandwillnotbelistedontheSIXSwissExchange(SIX),oronanyotherstock
exchangeorregulatedtradingfacilityinSwitzerland.Thisdocumentdoesnotconstituteaprospectuswithinthemeaningof,andhasbeenpreparedwithoutregard
tothedisclosurestandardsforissuanceprospectusesunderart.652aorart.1156oftheSwissCodeofObligationsorthedisclosurestandardsforlisting
prospectusesunderart.27ff.oftheSIXListingRulesorthelistingrulesofanyotherstockexchangeorregulatedtradingfacilityinSwitzerland.Neitherthis
documentnoranyotherofferingormarketingmaterialrelatingtothesharesortheofferingmaybepubliclydistributedorotherwisemadepubliclyavailablein
Switzerland.
Neitherthisdocumentnoranyotherofferingormarketingmaterialrelatingtotheoffering,usortheshareshavebeenorwillbefiledwithorapprovedbyany
Swissregulatoryauthority.Inparticular,thisdocumentwillnotbefiledwith,andtheofferofshareswillnotbesupervisedby,theSwissFinancialMarket
SupervisoryAuthorityFINMA(FINMA),andtheofferoftheshareshasnotbeenandwillnotbeauthorizedundertheSwissFederalActonCollective
InvestmentSchemes(CISA).TheinvestorprotectionaffordedtoacquirersofinterestsincollectiveinvestmentschemesundertheCISAdoesnotextendto
acquirersoftheshares.
Australia
Noplacementdocument,prospectus,productdisclosurestatementorotherdisclosuredocumenthasbeenlodgedwiththeAustralianSecuritiesandInvestments
Commission(ASIC),inrelationtotheoffering.Thisprospectusdoesnotconstituteaprospectus,productdisclosurestatementorotherdisclosuredocument
undertheCorporationsAct2001(theCorporationsAct),anddoesnotpurporttoincludetheinformationrequiredforaprospectus,productdisclosurestatement
orotherdisclosuredocumentundertheCorporationsAct.
AnyofferinAustraliaofthesharesmayonlybemadetopersons(theExemptInvestors)whoaresophisticatedinvestors(withinthemeaningofsection708(8)
oftheCorporationsAct),professionalinvestors(withinthemeaningofsection708(11)oftheCorporationsAct)orotherwisepursuanttooneormore
exemptionscontainedinsection708oftheCorporationsActsothatitislawfultooffertheshareswithoutdisclosuretoinvestorsunderChapter6Dofthe
CorporationsAct.
ThesharesappliedforbyExemptInvestorsinAustraliamustnotbeofferedforsaleinAustraliaintheperiodof12monthsafterthedateofallotmentunderthe
offering,exceptincircumstanceswheredisclosuretoinvestorsunderChapter6DoftheCorporationsActwouldnotberequiredpursuanttoanexemptionunder
section708oftheCorporationsActorotherwiseorwheretheofferispursuanttoadisclosuredocumentwhichcomplieswithChapter6DoftheCorporations
Act.AnypersonacquiringsharesmustobservesuchAustralianon-salerestrictions.
Thisprospectuscontainsgeneralinformationonlyanddoesnottakeaccountoftheinvestmentobjectives,financialsituationorparticularneedsofanyparticular
person.Itdoesnotcontainanysecurities
165
Table of Contents
recommendationsorfinancialproductadvice.Beforemakinganinvestmentdecision,investorsneedtoconsiderwhethertheinformationinthisprospectusis
appropriatetotheirneeds,objectivesandcircumstances,and,ifnecessary,seekexpertadviceonthosematters.
Hong Kong
ThesubordinatevotingshareshavenotbeenofferedorsoldandwillnotbeofferedorsoldinHongKong,bymeansofanydocument,otherthan(a)to
professionalinvestorsasdefinedintheSecuritiesandFuturesOrdinance(Cap.571)ofHongKongandanyrulesmadeunderthatOrdinance;or(b)inother
circumstanceswhichdonotresultinthedocumentbeingaprospectusasdefinedintheCompaniesOrdinance(Cap.32)ofHongKongorwhichdonotconstitute
anoffertothepublicwithinthemeaningofthatOrdinance.Noadvertisement,invitationordocumentrelatingtotheshareshasbeenormaybeissuedorhasbeen
ormaybeinthepossessionofanypersonforthepurposesofissue,whetherinHongKongorelsewhere,whichisdirectedat,orthecontentsofwhicharelikelyto
beaccessedorreadby,thepublicofHongKong(exceptifpermittedtodosounderthesecuritieslawsofHongKong)otherthanwithrespecttoshareswhichare
orareintendedtobedisposedofonlytopersonsoutsideHongKongoronlytoprofessionalinvestorsasdefinedintheSecuritiesandFuturesOrdinance
(Cap.571)andanyrulesmadeunderthatOrdinance.
Japan
ThesubordinatevotingshareshavenotbeenandwillnotberegisteredundertheFinancialInstrumentsandExchangeLawofJapan(LawNo.25of1948,as
amended)(theFIEL)and,accordingly,thesubordinatevotingshareshavenotbeenandwillnotbeofferedorsold,directlyorindirectly,inJapanorto,orforthe
benefitof,anyresidentofJapan(whichtermasusedhereinmeansanypersonresidentinJapan,includinganycorporationorotherentityorganizedunderthelaws
ofJapan)ortoothersforre-offeringorresale,directlyorindirectly,inJapanorto,orforthebenefitof,anyresidentofJapanexceptpursuanttoanexemptionfrom
theregistrationrequirementsof,andotherwiseincompliancewith,theFIELandanyotherapplicablelaws,regulationsandministerialguidelinespromulgatedby
relevantJapanesegovernmentalorregulatoryauthoritiesineffectattherelevanttime.
Singapore
ThisprospectushasnotbeenregisteredasaprospectuswiththeMonetaryAuthorityofSingapore.Accordingly,thisprospectusandanyotherdocumentormaterial
inconnectionwiththeofferorsale,orinvitationforsubscriptionorpurchase,ofthesharesmaynotbecirculatedordistributed,normaythesharesbeofferedor
sold,orbemadethesubjectofaninvitationforsubscriptionorpurchase,whetherdirectlyorindirectly,topersonsinSingaporeotherthan(i)toaninstitutional
investorunderSection274oftheSecuritiesandFuturesAct,Chapter289ofSingapore(theSFA),(ii)toarelevantpersonpursuanttoSection275(1),orany
personpursuanttoSection275(1A),andinaccordancewiththeconditionsspecifiedinSection275,oftheSFA,or(iii)otherwisepursuantto,andinaccordance
withtheconditionsof,anyotherapplicableprovisionoftheSFA.
WherethesubordinatevotingsharesaresubscribedorpurchasedunderSection275oftheSFAbyarelevantpersonwhichis:
acorporation(whichisnotanaccreditedinvestor(asdefinedinSection4AoftheSFA))thesolebusinessofwhichistoholdinvestmentsandthe
entiresharecapitalofwhichisownedbyoneormoreindividuals,eachofwhomisanaccreditedinvestor;or
atrust(wherethetrusteeisnotanaccreditedinvestor)whosesolepurposeistoholdinvestmentsandeachbeneficiaryofthetrustisanindividualwho
isanaccreditedinvestor,
166
Table of Contents
securities(asdefinedinSection239(1)oftheSFA)ofthatcorporationorthebeneficiariesrightsandinterest(howsoeverdescribed)inthattrustshallnotbe
transferredwithinsixmonthsafterthatcorporationorthattrusthasacquiredthesubordinatevotingsharespursuanttoanoffermadeunderSection275oftheSFA
except:
toaninstitutionalinvestorortoarelevantpersondefinedinSection275(2)oftheSFA,ortoanypersonarisingfromanofferreferredtoin
Section275(1A)orSection276(4)(i)(B)oftheSFA;
wherenoconsiderationisorwillbegivenforthetransfer;
wherethetransferisbyoperationoflaw;
asspecifiedinSection276(7)oftheSFA;or
asspecifiedinRegulation32oftheSecuritiesandFutures(OffersofInvestments)(SharesandDebentures)Regulations2005ofSingapore.
Theunderwritersdonotexpectsalestodiscretionaryaccountstoexceedfivepercentofthetotalnumberofsubordinatevotingsharesoffered.
Thecompanyandthesellingshareholdersestimatethattheirshareofthetotalexpensesoftheoffering,excludingunderwritingcommissions,willbe
approximately$5,200,000.
Thecompanyandthesellingshareholdershaveagreedtoindemnifytheseveralunderwritersagainstcertainliabilities,includingliabilitiesundertheSecuritiesAct
of1933andapplicableCanadiansecuritieslaws.
Theunderwritersandtheirrespectiveaffiliatesarefullservicefinancialinstitutionsengagedinvariousactivities,whichmayincludesalesandtrading,commercial
andinvestmentbanking,advisory,investmentmanagement,investmentresearch,principalinvestment,hedging,marketmaking,brokerageandotherfinancialand
non-financialactivitiesandservices.Certainoftheunderwritersandtheirrespectiveaffiliateshaveprovided,andmayinthefutureprovide,avarietyofthese
servicestotheissuerandtopersonsandentitieswithrelationshipswiththeissuer,forwhichtheyreceivedorwillreceivecustomaryfeesandexpenses.
Intheordinarycourseoftheirvariousbusinessactivities,theunderwritersandtheirrespectiveaffiliates,officers,directorsandemployeesmaypurchase,sellor
holdabroadarrayofinvestmentsandactivelytradesecurities,derivatives,loans,commodities,currencies,creditdefaultswapsandotherfinancialinstrumentsfor
theirownaccountandfortheaccountsoftheircustomers,andsuchinvestmentandtradingactivitiesmayinvolveorrelatetoassets,securitiesand/orinstruments
oftheissuer(directly,ascollateralsecuringotherobligationsorotherwise)and/orpersonsandentitieswithrelationshipswiththeissuer.Theunderwritersandtheir
respectiveaffiliatesmayalsocommunicateindependentinvestmentrecommendations,marketcolorortradingideasand/orpublishorexpressindependentresearch
viewsinrespectofsuchassets,securitiesorinstrumentsandmayatanytimehold,orrecommendtoclientsthattheyshouldacquire,longand/orshortpositionsin
suchassets,securitiesandinstruments.
167
Table of Contents
Legal Matters
CertainlegalmattersinconnectionwiththisofferingwillbepasseduponforusbyRopes&GrayLLP,SanFrancisco,CA.Ropes&GrayLLPandsomeofits
attorneysarelimitedpartnersofRGIP,LP,whichisaninvestorincertaininvestmentfundsadvisedbyBainCapitalPartnersLLCandoftenaco-investorwithsuch
funds.Upontheconsummationoftheoffering,RGIP,LPwilldirectlyorindirectlyownlessthan1%ofthevotingpowerofouroutstandingvotingshares.The
validityoftheissuanceofoursubordinatevotingsharesofferedinthisprospectusandcertainotherlegalmattersastoCanadianlawwillbepasseduponforusby
StikemanElliottLLP,Canada.CertainlegalmattersastoCanadianlawwillbepasseduponfortheunderwritersbyOsler,Hoskin&HarcourtLLP,Toronto,
Canada.Thepartners,counselandassociatesofeachofStikemanElliottLLPandOsler,Hoskin&HarcourtLLP,respectivelyasagroup,beneficiallyowndirectly
andindirectly,lessthan1%ofouroutstandingsecuritiesofanyclass.TheunderwritersarebeingrepresentedbyLatham&WatkinsLLP,NewYork,NY.
Experts
OurauditorsareDeloitteLLPlocatedat22AdelaideStreetWest,Suite200,Toronto,Ontario,M5H0A9.DeloitteLLPisindependentwithrespecttothecompany
withinthemeaningoftheRulesofProfessionalConductoftheCharteredProfessionalAccountantsofOntario,andwithinthemeaningoftheSecuritiesActof
1933andtheapplicablerulesandregulationsthereunderadoptedbytheSecuritiesandExchangeCommission(SEC)andthePublicCompanyAccounting
OversightBoard(UnitedStates)(PCAOB).
ThefinancialstatementsasofMarch31,2016and2015,andforeachofthetwoyearsintheperiodendedMarch31,2016,andtheperiodfromDecember9,2013
toMarch31,2014andtheperiodfromApril1,2013toDecember8,2013,andtherelatedfinancialstatementscheduleincludedinthisprospectus,havebeen
auditedbyDeloitteLLP,anindependentregisteredpublicaccountingfirm,asstatedintheirreportappearingherein.Suchfinancialstatementsandfinancial
statementschedulehavebeensoincludedinrelianceuponthereportofsuchfirmgivenupontheirauthorityasexpertsinaccountingandauditing.
Other Considerations
Ourindependentregisteredpublicaccountingfirm,DeloitteLLP,informedourmanagementandauditcommitteethatDeloitteToucheTomatsuLimitedmember
firmshadprovidedimpermissibleministerialservicesdeemedtobemanagementfunctionsattwoportfoliocompaniesofBainCapitalduringtheauditedfiscal
yearsincludedwithinthisprospectusandsuchserviceswerenotconsistentwiththeSECsauditorindependencerules.TheDeloittememberfirmswerepaidless
than$10,000inaggregatefortheseservices.Noneoftheserviceswereprovidedto,paidforby,orinvolvedanyCanadaGooseentity.
Inlightofthecircumstancesnotedabove,DeloitteLLPadvisedusthattheirintegrity,objectivityorimpartialitywerenotimpairedwithrespecttoplanningand
performingtheauditsincludedinthisprospectus.WealsoreviewedandconsideredtheimpactthesemattersmayhavehadonDeloitteLLPsindependencewith
respecttoitundertheapplicableSEC,PCAOBandCharteredProfessionalAccountantsofOntarioindependencerules.Afterconsideringallthefactsand
circumstancesnotedabove,ourauditcommitteedeterminedthatthematterwouldnotimpairDeloitteLLPsabilitytoexerciseobjectiveandimpartialjudgmenton
allissuesencompassedwithintheirauditengagementsfortheperiodsincludedinthisprospectus.
168
Table of Contents
shareholderswhoresideintheUnitedStatestoeffectservicewithintheUnitedStatesuponthosedirectors,officersandexpertswhoarenotresidentsoftheUnited
States.ItmayalsobedifficultforshareholderswhoresideintheUnitedStatestorealizeintheUnitedStatesuponjudgmentsofcourtsoftheUnitedStates
predicateduponourcivilliabilityandthecivilliabilityofourdirectors,officersandexpertsundertheUnitedStatesfederalsecuritieslaws.Therecanbeno
assurancethatU.S.investorswillbeabletoenforceagainstus,membersofourboardofdirectors,officersorcertainexpertsnamedhereinwhoareresidentsof
CanadaorothercountriesoutsidetheUnitedStates,anyjudgmentsincivilandcommercialmatters,includingjudgmentsunderthefederalsecuritieslaws.
Total
$ 5,200,000
(1) ExchangeratecalculatedbasedonthenoonbuyingrateofUS$1.00=C$1.3106certifiedforcustomspurposesbytheU.S.FederalReserveBankofNew
YorkonFebruary24,2017.
Uponcompletionofthisoffering,wewillbesubjecttoperiodicreportingandotherinformationalrequirementsoftheExchangeActasapplicabletoforeignprivate
issuers.Accordingly,wearerequiredtofilereports,
169
Table of Contents
includingannualreportsonForm20-F,andotherinformationwiththeSEC.Althoughwearenotrequiredtoprepareandissuequarterlyreportsasaforeignprivate
issuer,wecurrentlyintendtofilequarterlyreportsonForm6-KwiththeSEC.Asaforeignprivateissuer,weareexemptfromtherulesoftheExchangeAct
prescribingthefurnishingandcontentofproxystatementstoshareholdersandSection16short-swingprofitreportingforourofficer,directorsandholdersofmore
than10%ofourvotingshares.
WewillalsobesubjecttothefullinformationalrequirementsofthesecuritiescommissionsinallprovincesandterritoriesofCanada.Youareinvitedtoreadand
copyanyreports,statementsorotherinformation,otherthanconfidentialfilings,thatweintendtofilewiththeCanadianprovincialandterritorialsecurities
commissions.ThesefilingsarealsoelectronicallyavailablefromtheCanadianSystemforElectronicDocumentAnalysisandRetrieval(SEDAR)
(http://www.sedar.com),theCanadianequivalentoftheSECsElectronicDocumentGatheringandRetrievalSystem.DocumentsfiledonSEDARarenot,and
shouldnotbeconsidered,partofthisprospectus.
170
Table of Contents
Report of Independent Registered Public Accounting Firm dated January 13, 2017 F-2
ConsolidatedStatementsofIncome(Loss)andComprehensiveIncome(Loss)fortheyearsendedMarch31,2016,March31,2015,andtheperiods
fromDecember9,2013toMarch31,2014andApril1,2013toDecember8,2013 F-3
ConsolidatedStatementsofFinancialPositionasatMarch31,2016andMarch31,2015 F-4
ConsolidatedStatementsofChangesinEquityasatMarch31,2016,March31,2015,March31,2014,December9,2013andApril1,2013 F-5
ConsolidatedStatementsofCashFlowsfortheyearsendedMarch31,2016,March31,2015,andtheperiodsfromDecember9,2013toMarch31,
2014andApril1,2013toDecember8,2013 F-6
NotestotheConsolidatedFinancialStatements F-7
Schedule1CondensedParentCompanyFinancialInformation F-48
F-1
Table of Contents
TotheBoardofDirectorsandShareholdersof
CanadaGooseHoldingsInc.
Toronto,Canada
WehaveauditedtheaccompanyingconsolidatedstatementsoffinancialpositionofCanadaGooseHoldingsInc.andsubsidiaries(theCompany),asof
March31,2016and2015,andtherelatedconsolidatedstatementsofincome(loss)andcomprehensiveincome(loss),consolidatedstatementsofchangesinequity,
andconsolidatedstatementsofcashflowsforeachoftheyearsthenended,andtheperiodfromDecember9,2013toMarch31,2014andtheperiodfromApril1,
2013toDecember8,2013.OurauditsalsoincludedthefinancialstatementscheduleofCondensedParentCompanyFinancialInformation.Thesefinancial
statementsandthefinancialstatementschedulearetheresponsibilityoftheCompanysmanagement.Ourresponsibilityistoexpressanopiniononthesefinancial
statementsandthefinancialstatementschedulebasedonouraudits.
WeconductedourauditsinaccordancewiththestandardsofthePublicCompanyAccountingOversightBoard(UnitedStates)andCanadiangenerallyaccepted
auditingstandards.Thosestandardsrequirethatweplanandperformtheaudittoobtainreasonableassuranceaboutwhetherthefinancialstatementsarefreeof
materialmisstatement.TheCompanyisnotrequiredtohave,norwereweengagedtoperform,anauditofitsinternalcontroloverfinancialreporting.Ouraudits
includedconsiderationofinternalcontroloverfinancialreportingasabasisfordesigningauditproceduresthatareappropriateinthecircumstances,butnotforthe
purposeofexpressinganopinionontheeffectivenessoftheCompanysinternalcontroloverfinancialreporting.Accordingly,weexpressnosuchopinion.An
auditincludes,examiningonatestbasis,evidencesupportingtheamountsanddisclosuresinthefinancialstatements,assessingtheaccountingprinciplesusedand
significantestimatesmadebymanagement,aswellasevaluatingtheoverallfinancialstatementpresentation.Webelievethatourauditsprovideareasonablebasis
forouropinion.
Inouropinion,suchconsolidatedfinancialstatementspresentfairly,inallmaterialrespects,thefinancialpositionofCanadaGooseHoldingsInc.andsubsidiaries
asofMarch31,2016and2015,andtheresultsoftheiroperationsandtheircashflowsforeachoftheyearsthenended,andtheperiodfromDecember9,2013to
March31,2014andtheperiodfromApril1,2013toDecember8,2013,inaccordancewithInternationalFinancialReportingStandardsasissuedbythe
InternationalAccountingStandardsBoard.Also,inouropinion,suchfinancialstatementschedule,whenconsideredinrelationtothebasicconsolidatedfinancial
statementstakenasawhole,presentfairlyinallmaterialrespectstheinformationsetforththerein.
/s/DeloitteLLP
CharteredProfessionalAccountants
LicensedPublicAccountants
Toronto,Canada
January13,2017
F-2
Table of Contents
Successor Predecessor
December 9,
2013 to April 1 to
March 31 March 31 March 31, December 8,
Notes 2016 2015 2014 2013
$ $ $ $
Revenue 6 290,830 218,414 17,263 134,822
Costofsales
10 145,206
129,805
14,708
81,613
Othercomprehensiveloss
(692)
Theaccompanyingnotestotheconsolidatedfinancialstatementsareanintegralpartofthisfinancialstatement.
F-3
Table of Contents
Total assets
353,018
274,825
Liabilities
Current liabilities
Accountspayableandaccruedliabilities 14 38,451 23,369
Provisions 15 3,125 4,080
Incometaxespayable 7 7,155 398
Currentportionofcreditfacility
16
1,250
1,250
Theaccompanyingnotestotheconsolidatedfinancialstatementsareanintegralpartofthisfinancialstatement.
F-4
Table of Contents
ShareCapital Accumulated
Retained other
Common Preferred Contributed Earnings comprehensive
Notes Shares Shares Total Surplus (Deficit) loss Total
$ $ $ $ $ $ $
BalanceasatApril1,2013 100
1
101
6,694
6,795
EndingbalanceasatDecember8,2013 101
1
102
21,972
22,074
OpeningBalanceasatNovember21,2013
IssuanceofsharecapitalfortheAcquisitiononDecember9,2013
5
53,144
53,144
56,940
110,084
BalanceasatDecember9,2013
53,144
53,144
56,940
110,084
BalanceasatMarch31,2014
3,350
53,144
56,494
56,940
(15,477)
97,957
BalanceasatMarch31,2015
3,350
54,895
58,245
57,240
(1,052)
114,433
BalanceasatMarch31,2016 3,350
56,871
60,221
57,740
25,433
(692)
142,702
Theaccompanyingnotestotheconsolidatedfinancialstatementsareanintegralpartofthisfinancialstatement.
F-5
Table of Contents
Successor Predecessor
December 9,
2013 to April 1 to
March 31 March 31 March 31, December 8,
Notes 2016 2015 2014 2013
$ $ $ $
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) 26,485 14,425 (15,477) 15,278
Itemsnotaffectingcash
Depreciationandamortization 11 5,916 3,394 1,029 966
Incometaxexpense(recovery) 7 6,473 4,707 (5,054) 5,550
Interestexpense 7,851 7,058 1,688 1,815
Unrealized(gain)lossonforwardexchangecontracts (5,366) (138) 339
Share-basedcompensation 17 500 300
Lossondisposalofassets 486 913
Changesinnon-cashoperatingitems 21 (37,848) (17,493) 5,636 (3,873)
Incometaxespaid (3,669) (1,936) 509 (2,719)
Interestpaid
(7,270)
(6,270)
(263)
(1,815)
Netcashfrom(usedin)operatingactivities
(6,442)
4,960
(11,593)
15,202
Netcashfrom(usedin)investingactivities
(21,842)
(7,263)
(149,431)
(6,361)
Netcashfrom(usedin)financingactivities
29,592
4,951
164,294
(5,715)
Cash,endofperiod
7,226
5,918
3,270
4,477
Theaccompanyingnotestotheconsolidatedfinancialstatementsareanintegralpartofthisfinancialstatement.
F-6
Table of Contents
Statement of compliance
TheaccompanyingconsolidatedfinancialstatementshavebeenpreparedinaccordancewithInternationalFinancialReportingStandards(IFRS)asissuedbythe
InternationalAccountingStandardsBoard(IASB).
TheseconsolidatedfinancialstatementswereauthorizedforissuancebytheCompanysBoardofDirectorsonJanuary13,2017.
Basis of consolidation
SubsidiariesareentitiescontrolledbytheCompany.ControlexistswhentheCompanyhaspowerover,exposureorrightstovariablereturnsfromtheCompanys
involvementwiththeentity,andtheabilitytouseitspowerovertheentitytoaffecttheamountoftheCompanysreturns.Thefinancialaccountsandresultsof
subsidiariesareincludedintheconsolidatedfinancialstatementsoftheCompanyfromthedatethatcontrolcommencesuntilthedatethatcontrolceases.
TheaccompanyingconsolidatedfinancialstatementsincludetheaccountsandresultsoftheCompanyanditswhollyownedsubsidiaries:
Subsidiaries Location
CanadaGooseInc. Canada
CanadaGooseInternationalHoldingsLimited UnitedKingdom
CanadaGooseEuropeAB Sweden
CanadaGooseInternationalAG Switzerland
CanadaGooseServicesLimited UnitedKingdom
CanadaGooseUS,Inc. USA
CanadaGooseTradingInc. Canada
Basis of presentation:
OnNovember21,2013,aninvestmentfundadvisedbyBainCapitalPrivateEquityLP(alongwithcertainaffiliatesandanysuccessortoitsinvestment
managementbusiness,BainCapital),incorporatedCanadaGooseHoldingsInc.(aBritishColumbiacorporation)(theSuccessor).Pursuanttothepurchaseand
saleagreementdatedDecember9,2013(theAgreement),awhollyownedsubsidiaryoftheSuccessor,CanadaGooseProductsInc.(aBritishColumbia
corporation,whichlatercontinuedasanOntariocorporationunderthenameCanadaGooseInc.)acquiredalltheoperatingassetsoftheformerCanadaGooseInc.
(acorporationindirectlycontrolledbythePresidentandChiefExecutiveOfficeroftheCompany,FormerCanadaGooseInc.orthePredecessor)andsalesand
distributioncompaniesownedbyFormerCanadaGooseInc.whichconsistedof
F-7
Table of Contents
CanadaGooseEuropeAB,CanadaGooseUS,Inc.andCanadaGooseTradingInc.(theAcquisition).AsaresultofthecompletionoftheAcquisition,funds
advisedbyBainCapitalown70%oftheCompanyandFormerCanadaGooseInc.(currentlynamedBlackFeatherHoldingsIncorporated)indirectlyowns30%of
theCompany.
AsfurtherdescribedinNote5totheseconsolidatedfinancialstatements,theAcquisitionwasaccountedforasabusinesscombinationusingtheacquisitionmethod
ofaccountingandtheSuccessorfinancialstatementsreflectanewbasisofaccountingthatisbasedonthefairvalueofassetsacquiredandliabilitiesassumedasof
theeffectivetimeoftheAgreement.PeriodspresentedpriortoDecember9,2013representtheoperationsofthePredecessorandtheperiodspresentedonandafter
December9,2013representtheoperationsoftheSuccessor.
ThefiscalyearendedMarch31,2014includesthe252dayPredecessorperiodfromApril1,2013throughDecember8,2013(PredecessorPeriod)andthe113
daySuccessorperiodfromDecember9,2013throughMarch31,2014(SuccessorPeriod).Accordingly,theCompanysaccumulateddeficitasofMarch31,
2014andMarch31,2015,andtheCompanysretainedearningsasatMarch31,2016representonlytheresultsofoperationssubsequenttoDecember9,2013,the
dateoftheAcquisition.ThePredecessorandSuccessorperiodshavebeenseparatedbyablacklineontheconsolidatedfinancialstatementstohighlightthefact
thatthefinancialinformationforsuchperiodshasbeenpreparedundertwodifferentcostbasesofaccounting.Allintercompanytransactionshavebeeneliminated.
F-8
Table of Contents
exchangeratesofmonetaryassetsandliabilitiesdenominatedinforeigncurrenciesarerecognizedinthestatementofincomeunderthecaption
selling,generalandadministrativeexpenses.
Foreignoperations
TheCompanysforeignoperationswereprincipallyconductedthroughCanadaGooseEuropeABandCanadaGooseUS,Inc.Althoughthese
operationsmayexposetheCompanytocertainlevelsofforeigncurrencyrisk,theunderlyingtransactionsarecarriedoutasanextensionofthe
Company,andasaresulttheseforeignoperationshaveaCanadiandollarfunctionalcurrency.
Thefinancialstatementsoftheseforeignoperationsaretranslatedusingtheexchangerateatthedateofthestatementoffinancialpositionexceptfor
property,plantandequipmentandequity,whicharetranslatedathistoricalrates.Transactionsincurrenciesotherthanthefunctionalcurrencyare
translatedattheexchangerateineffectatthedateofeachtransaction.Differencesinexchangeratesduringtheperiodbetweenthedateatransaction
denominatedinaforeigncurrencyisconsummatedandthedateonwhichitiseithersettledortranslated,arerecognizedinselling,generaland
administrativeexpenses.
(c) Seasonality
Weexperienceseasonalfluctuationsinourrevenueandoperatingresultsandhistoricallyhaverealizedasignificantportionofourrevenueandincome
fortheyearduringoursecondandthirdfiscalquarters.Thus,lower-than-expectedsecondandthirdquarternetrevenuecouldhaveanadverseimpact
onourannualoperatingresults.
Workingcapitalrequirementstypicallyincreaseduringthefirstandsecondquartersofthefiscalyearasinventorybuildstosupportpeakshippingand
sellingperiodsand,accordingly,typicallydecreaseduringthefourthquarterofthefiscalyearasinventoryisshippedandsold.Cashflowsfrom
operatingactivitiesistypicallyhigherinthefourthquarterofthefiscalyearduetoreducedworkingcapitalrequirementsduringthatperiod.
i) Wholesale
Wholesalerevenuecomprisessalestothirdpartyresellers(whichincludesdistributorsandretailers)oftheCompanysproducts.Wholesale
revenuefromthesaleofgoodsisrecognizedwhenthesignificantrisksandrewardsofownershipofthegoodshavepassedtothereseller,
whichisassoonastheproductshavebeenshippedtothereseller,thereisnocontinuingmanagementinvolvementorobligationaffectingthe
acceptanceofthegoods,netofanestimatedallowanceforsalesreturns.
TheCompany,atitsdiscretion,maycancelalloraportionofanyfirmwholesalesalesorder.TheCompanyisthereforeobligatedtoreturn
anyprepaymentsordepositsmadebyresellersforwhichtheproductisnotprovided.Alladvancepaymentsareincludedinaccruedliabilities
inthebalancesheet.
F-9
Table of Contents
F-10
Table of Contents
Deferredincometax
Deferredincometaxisprovidedusingtheliabilitymethodfortemporarydifferencesatthereportingdatebetweentheincometaxbasesofassetsand
liabilitiesandtheircarryingamountsforfinancialreportingpurposes.
Deferredincometaxismeasuredusingenactedorsubstantivelyenactedincometaxratesexpectedtoapplyintheyearsinwhichthosetemporary
differencesareexpectedtoberecoveredorsettled.Adeferredtaxassetisrecognizedforunusedincometaxlossesandcreditstotheextentthatitis
probablethatfuturetaxableincomewillbeavailableagainstwhichtheycanbeutilized.
Thecarryingamountofdeferredtaxassetsisreviewedateachreportingdateandreducedtotheextentthatitisnolongerprobablethatsufficient
taxableincomewillbeavailabletoallowallorpartofthedeferredtaxassettobeutilized.Unrecognizeddeferredtaxassetsarereassessedateach
reportingdateandarerecognizedtotheextentthatithasbecomeprobablethatfuturetaxableincomewillallowthedeferredtaxassettoberecovered.
Deferredincometaxrelatingtoitemsrecognizedoutsideprofitorlossisrecognizedoutsideprofitorloss.Deferredtaxitemsarerecognizedin
correlationtotheunderlyingtransactioneitherinothercomprehensiveincomeordirectlyinequity.
Deferredtaxassetsanddeferredtaxliabilitiesareoffsetifalegallyenforceablerightexiststosetoffcurrentincometaxassetsagainstcurrentincome
taxliabilitiesandthedeferredtaxrelatestothesametaxableentityandthesametaxationauthority.
Deferredincometaxisprovidedontemporarydifferencesarisingoninvestmentsinsubsidiaries,exceptwherethetimingofthereversalofthe
temporarydifferenceiscontrolledbytheCompanyanditisprobablethatthetemporarydifferencewillnotreverseintheforeseeablefuture.
(h) Cash
Cashcomprisescashatbanksandonhand.TheCompanyusestheindirectmethodofreportingcashflowfromoperatingactivities.
(j) Inventories
Rawmaterials,work-in-processandfinishedgoodsarevaluedatthelowerofcostandnetrealizablevalue.Costisdeterminedusingtheweighted
averagecostmethod.Thecostofwork-in-processandfinishedgoodsinventoriesincludethecostofrawmaterialsandanapplicableshareofthecost
oflabourandfixedandvariableproductionoverhead,includingdepreciationofproperty,plantandequipmentusedintheproductionoffinished
goodsanddesigncosts,andothercostsincurredinbringingtheinventoriestotheirpresentlocationandcondition.
TheCompanyestimatesnetrealizablevalueastheamountatwhichinventoriesareexpectedtobesold,takingintoconsiderationfluctuationsin
sellingpricesduetoseasonality,lessestimatedcostsnecessarytocompletethesale.
F-11
Table of Contents
Inventoriesarewrittendowntonetrealizablevaluewhenthecostofinventoriesisestimatedtobeunrecoverableduetoobsolescence,damageor
decliningsellingprices.Whencircumstancesthatpreviouslycausedinventoriestobewrittendownbelowcostnolongerexistorwhenthereisclear
evidenceofanincreaseinsellingprices,theamountofthewrite-downpreviouslyrecordedisreversed.
Storagecosts,indirectadministrativeoverheadandcertainsellingcostsrelatedtoinventoriesareexpensedintheperiodthatthesecostsareincurred.
F-12
Table of Contents
Theusefullivesofintangibleassetsareassessedaseitherfiniteorindefinite.
(m) Goodwill
GoodwillrepresentsthedifferencebetweenthepurchasepriceofanacquiredbusinessandtheCompanysshareofthenetidentifiableassetsacquired
andliabilitiesandcertaincontingentliabilitiesassumed.Itisinitiallyrecordedatcostandsubsequentlymeasuredatcostlessanyaccumulated
impairmentlosses.
Forthepurposeofimpairmenttesting,goodwillacquiredinabusinesscombinationis,fromtheacquisitiondate,allocatedtocash-generatingunits
(CGU)basedonthelowestlevelwithintheentityinwhichthegoodwillismonitoredforinternalmanagementpurposes.Theallocationismadeto
thoseCGUsthatareexpectedtobenefitfromthebusinesscombinationinwhichthegoodwillarose.Anypotentialimpairmentofgoodwillis
identifiedbycomparingtherecoverableamountofaCGUtoitscarryingvalue.Goodwillisreducedbytheamountofdeficiency,ifany.Ifthe
deficiencyexceedsthecarryingamountofgoodwill,thecarryingvaluesoftheremainingassetsintheCGUarereducedbytheexcessonapro-rata
basis.TheCompanytestsgoodwillforimpairmentannuallyinthefourthquarteroftheyear.
TherecoverableamountofaCGUisthehigheroftheestimatedfairvaluelesscostsofdisposalorvalue-in-useoftheCGU.Inassessingvalue-in-use,
theestimatedfuturecashflowsarediscounted
F-13
Table of Contents
usingapre-taxdiscountratethatreflectscurrentmarketassessmentsofthetimevalueofmoneyandtherisksspecifictotheasset.
TheCompanyhasevaluatedthatthegoodwillcontributestothecashflowsofthreeCGUs.
(n) Provisions
ProvisionsarerecognizedwhentheCompanyhasapresentobligation,legalorconstructive,asaresultofapastevent,itisprobablethatanoutflowof
resourcesembodyingeconomicbenefitswillberequiredtosettletheobligation,andareliableestimatecanbemadeoftheamountoftheobligation.
WheretheCompanyexpectssomeorallofaprovisiontobereimbursed,forexampleunderaninsurancecontract,thereimbursementisrecognizedas
aseparateassetbutonlywhenthereimbursementisvirtuallycertain.Theexpenserelatingtoanyprovisionispresentedinthestatementofincomenet
ofanyreimbursement.Iftheeffectofthetimevalueofmoneyismaterial,provisionsarediscountedusingacurrentpre-taxratethatreflects,where
appropriate,therisksspecifictotheliability.Wherediscountingisused,theincreaseintheprovisionduetothepassageoftimeisrecognizedinthe
statementofincome.
TheprovisionforwarrantyreturnsrelatestotheCompanysobligationfordefectivegoodssoldtocustomersthathaveyettobereturned.Accrualsfor
salesandwarrantyreturnsareestimatedonthebasisofhistoricalreturnsandarerecordedsoastoallocatethemtothesameperiodthecorresponding
revenueisrecognized.
Intheprincipalmarketfortheassetorliability,or
Intheabsenceofaprincipalmarket,inthemostadvantageousmarketfortheassetorliability.
TheCompanyusesvaluationtechniquesthatitbelievesareappropriateinthecircumstancesandforwhichsufficientdataareavailabletomeasurefair
value,maximizingtheuseofrelevantobservableinputsandminimizingtheuseofunobservableinputs.Allassetsandliabilitiesforwhichfairvalueis
measuredordisclosedinthefinancialstatementsarecategorizedwithinthefairvaluehierarchy,
F-14
Table of Contents
describedasfollows,basedonthelowestlevelinputthatissignificanttothefairvaluemeasurementasawhole:
Level 1: quotedprices(unadjusted)inactivemarketsforidenticalassetsorliabilitiesthatthereportingentityhastheabilitytoaccessatthe
measurementdate.
Level 2: inputsotherthanquotedpricesincludedwithinlevel1thatareobservablefortheassetorliability,eitherdirectlyorindirectly.
Level 3: areunobservableinputsfortheassetorliability.Unobservableinputsshallbeusedtomeasurefairvaluetotheextentthatobservable
inputsarenotavailable,therebyallowingforsituationsinwhichthereislittle,ifany,marketactivityfortheassetorliabilityatthe
measurementdate.
Forthepurposeoffairvaluedisclosures,theCompanyhasdeterminedclassesofassetsandliabilitiesonthebasisofthenature,characteristicsand
risksoftheassetorliabilityandthelevelofthefairvaluehierarchyasexplainedabove.
ThedeterminationofthefairvalueoffinancialinstrumentsisperformedbytheCompanystreasuryandfinancialreportingdepartmentsonaquarterly
basis.Therewasnochangeinthevaluationtechniquesappliedtofinancialinstrumentsduringallperiodspresented.Thefollowingtabledescribesthe
valuationtechniquesusedinthedeterminationofthefairvaluesoffinancialinstruments:
F-15
Table of Contents
Financialassetsandfinancialliabilitiesareinitiallymeasuredatfairvalue.Transactioncoststhataredirectlyattributabletotheacquisitionorissueof
financialassetsandfinancialliabilities(otherthanfinancialassetsandfinancialliabilitiesclassifiedatfairvaluethroughprofitorloss)areaddedto,or
deductedfrom,thefairvalueofthefinancialassetsorfinancialliabilities,asappropriate,oninitialrecognition.Transactioncostsdirectlyattributable
totheacquisitionoffinancialassetsorfinancialliabilitiesclassifiedatfairvaluethroughprofitorlossarerecognizedimmediatelyinprofitorloss.
Financialassetsandfinancialliabilitiesaremeasuredsubsequentlyasdescribedbelow.
a. Non-derivativefinancialassets
Non-derivativefinancialassetsincludecashandtradereceivablesandareclassifiedasloansandreceivablesandmeasuredatamortized
cost.TheCompanyinitiallyrecognizesreceivablesanddepositsonthedatethattheyareoriginated.TheCompanyderecognizesa
financialassetwhenthecontractualrightstothecashflowsfromtheassetexpire,orittransferstherightstoreceivethecontractual
cashflowsonthefinancialassetinatransactioninwhichsubstantiallyalltherisksandrewardsofownershipofthefinancialassetare
transferred.
b. Non-derivativefinancialliabilities
Non-derivativefinancialliabilitiesincludeaccountspayable,accruedliabilities,creditfacilityandsubordinateddebt.TheCompany
initiallyrecognizesdebtinstrumentsissuedonthedatethattheyareoriginated.Allotherfinancialliabilitiesarerecognizedinitiallyon
thetradedateatwhichtheCompanybecomesapartytothecontractualprovisionsoftheinstrument.Financialliabilitiesarerecognized
initiallyatfairvaluelessanydirectlyattributabletransactioncosts.Subsequenttoinitialrecognition,thesefinancialliabilitiesare
measuredatamortizedcostusingtheeffectiveinterestmethod.TheCompanyderecognizesafinancialliabilitywhenitscontractual
obligationsaredischargedorcancelledorexpire.
c. Derivativefinancialinstruments
TheCompanyisexposedtotheriskofcurrencyfluctuationsandhasenteredintocurrencyderivativecontractstohedgeitsexposureon
thebasisofplannedtransactions.Thesecontractsgenerallycoveraperiodoflessthanoneyear.TheCompanyshedgingactivitiesare
notdesignatedashedgesforaccountingpurposes.Derivativefinancialinstrumentsarerecognizedinitiallyatfairvalue;attributable
transactioncostsarerecognizedinthestatementofincomeasincurred.Subsequenttoinitialrecognition,derivativefinancial
instrumentsaremeasuredatfairvalue,andchangesthereinarerecognizedimmediatelyinthestatementofincome.
Embeddedderivativesareseparatedfromahostcontractandaccountedforseparatelyiftheeconomiccharacteristicsandrisksofthe
hostcontractandtheembeddedderivativearenotcloselyrelated.TheCompanymeasuresallderivativefinancialinstrumentsfrom
optionpricingmodels.TheCompanyhasreviewedallsignificantcontractualagreementsanddeterminedthatthesemandatory
conversionfeaturesontheCompanyssubordinateddebt,whicharecontingentuponaliquidityeventorsaleofsharesevent,qualifyas
anembeddedderivative.Giventheremoteprobabilityofoccurrence,theCompanyhasdeterminedthefairvalueoftheseembedded
derivativestobenil.
F-16
Table of Contents
(r) Leases
Operatingleasepaymentsnetofanyleaseinducementsarerecognizedasanexpenseinthestatementofprofitorlossonastraightlinebasisoverthe
leaseterm.
Estimatesandassumptionsareusedmainlyindeterminingthemeasurementofbalancesrecognizedordisclosedintheconsolidatedfinancialstatementsandare
basedonasetofunderlyingdatathatmayincludemanagementshistoricalexperience,knowledgeofcurrenteventsandconditionsandotherfactorsthatare
believedtobereasonableunderthecircumstances.Managementcontinuallyevaluatestheestimatesandjudgmentsituses.Theseestimatesandjudgmentshave
beenappliedinamannerconsistentwithpriorperiodsandtherearenoknowntrends,commitments,eventsoruncertaintiesthatwebelievewillmateriallyaffect
themethodologyorassumptionsutilizedinmakingtheseestimatesandjudgementsinthesefinancialstatements.
ThefollowingaretheaccountingpoliciessubjecttojudgementsandkeysourcesofestimationuncertaintythattheCompanybelievescouldhavethemost
significantimpactontheamountsrecognizedintheconsolidatedfinancialstatements.
Inventories
Key Sources of Estimation Inventoriesarecarriedatthelowerofcostandnetrealizablevalue;inestimatingnetrealizablevalue,theCompanyusesestimates
relatedtofluctuationsininventorylevels,customerbehaviour,obsolescence,futuresellingprices,seasonalityandcostsnecessarytoselltheinventory.
Inventoryisadjustedtoreflectestimatedloss(shrinkage)incurredsincethelastinventorycount.Shrinkageisbasedonhistoricalexperience.
F-17
Table of Contents
Impairment of non-financial assets (goodwill, intangible assets, and property, plant & equipment)
Judgments Made in Relation to Accounting Policies Applied ManagementisrequiredtousejudgmentindeterminingthegroupingofassetstoidentifytheirCGUs
forthepurposesoftestingnon-financialassetsforimpairment.JudgmentisfurtherrequiredtodetermineappropriategroupingsofCGUsforthelevelatwhich
goodwillandintangibleassetsaretestedforimpairment.Forthepurposeofgoodwillandintangibleassetsimpairmenttesting,CGUsaregroupedatthelowest
levelatwhichgoodwillandintangibleassetsaremonitoredforinternalmanagementpurposes.Inaddition,judgmentisusedtodeterminewhetheratriggering
eventhasoccurredrequiringanimpairmenttesttobecompleted.TheCompanyhasconcludedthatithasthreeCGUsandtestsgoodwillandtheseintangibleassets
forimpairmentonthatbasis.
Functional currency
Judgments Made in Relation to Accounting Policies Applied TheCompanyassessestherelevantfactorsrelatedtotheprimaryeconomicenvironmentinwhichits
entitiesoperatetodeterminethefunctionalcurrency.Wheretheassessmentofprimaryindicatorsismixed,Managementassessesthesecondaryindicators,
includingtherelationshipbetweentheforeignoperationsandreportingentity.
Financial instruments
Key Sources of Estimation Thecriticalassumptionsandestimatesusedindeterminingthefairvalueoffinancialinstrumentsare:equityprices;futureinterestrates;
therelativecreditworthinessoftheCompanytoitscounterparties;estimatedfuturecashflows;discountrates;andvolatilityutilizedinoptionvaluations.
F-18
Table of Contents
Trade receivables
Key Sources of Estimation: TheCompanyhasasignificantnumberofcustomerswhichminimizestheconcentrationofcreditrisk.TheCompanydoesnothaveany
customerswhichaccountformorethan10%ofsalesoraccountsreceivable.Wemakeongoingestimatesrelatingtotheabilitytocollectouraccountsreceivable
andmaintainanallowanceforestimatedlossesresultingfromtheinabilityofourcustomerstomakerequiredpayments.Indeterminingtheamountofthe
allowance,weconsiderourhistoricallevelofcreditlossesandmakejudgmentsaboutthecreditworthinessofsignificantcustomersbasedonongoingcredit
evaluations.
Share-based payments
Key Sources of Estimation Thecriticalassumptionsandestimatesusedindeterminingthefairvalueofshare-basedpaymentsontheirgrantdateare:fairvalueof
theentityonthegrantdate;volatilityofsharepriceforanon-publiclytradedentity;expectedforfeiturerate;andexpectedterm.
Warranty
Key Sources of Estimation Thecriticalassumptionsandestimatesusedindeterminingthewarrantyprovisionatthestatementoffinancialpositiondateare:number
ofjacketsexpectedtorequirerepairorreplacement;proportiontoberepairedversusreplaced;periodinwhichthewarrantyclaimisexpectedtooccur;costof
repair;costofjacketreplacement;risk-freerateusedtodiscounttheprovisiontopresentvalue.
Business combinations
Key Sources of Estimation Inabusinesscombination,theidentifiableassetsacquiredandliabilitiesassumedwillberecognizedattheirfairvalues.TheCompany
makesjudgementsandestimatesindeterminingthefairvalues.Theexcessofthepurchasepriceoverthefairvaluesofidentifiableassetsacquiredandliabilities
assumedwillberecognizedasgoodwill,ifpositive,andifnegative,itisrecognisedinthestatementofincome.
In2016,theIASBissuedIFRS16,Leases(IFRS16),replacingIAS17,Leasesandrelatedinterpretations.Thestandardintroducesasingleon-statementof
financialpositionrecognitionandmeasurementmodelforlessees,eliminatingthedistinctionbetweenoperatingandfinanceleases.Lessorscontinuetoclassify
leasesasfinanceandoperatingleases.IFRS16becomeseffectiveforannualperiodsbeginningonorafterJanuary1,2019,andistobeappliedretrospectively.
EarlyadoptionispermittedifIFRS15,RevenuefromContractswithCustomers(IFRS15)hasbeenadopted.TheCompanyiscurrentlyassessingtheimpact
ofthenewstandardonitsconsolidatedfinancialstatements.
F-19
Table of Contents
In2014,theIASBissuedIFRS15,replacingIAS18,Revenue,IAS11,ConstructionContracts,andrelatedinterpretations.Thenewstandardprovidesa
comprehensiveframeworkfortherecognition,measurementanddisclosureofrevenuefromcontractswithcustomers,excludingcontractswithinthescopeofthe
accountingstandardsonleases,insurancecontractsandfinancialinstruments.IFRS15becomeseffectiveforannualperiodsbeginningonorafterJanuary1,2018,
andistobeappliedretrospectively.Earlyadoptionispermitted.TheCompanyiscurrentlyassessingtheimpactofthenewstandardonitsconsolidatedfinancial
statements.
InJuly2014,theIASBissuedthefinalversionofIFRS9,whichreflectsallphasesofthefinancialinstrumentsprojectandreplacesIAS39,Financial
Instruments:RecognitionandMeasurement,andallpreviousversionsofIFRS9.Thestandardintroducesnewrequirementsforclassificationandmeasurement,
impairment,andhedgeaccounting.IFRS9ismandatorilyeffectiveforannualperiodsbeginningonorafterJanuary1,2018.Earlyadoptionispermitted.The
Companyiscurrentlyassessingtheimpactofthenewstandardonitsconsolidatedfinancialstatements.
AmendmentstoIAS7,StatementofCashFlows(IAS7)wereissuedbytheIASBinJanuary2016.Theamendmentclarifiesthatentitiesshallprovide
disclosuresthatenableusersoffinancialstatementstoevaluatechangesinliabilitiesarisingfromfinancingactivities.TheamendmenttoIAS7iseffectivefor
annualperiodsbeginningonorafterJanuary1,2017.TheCompanyiscurrentlyassessingtheimpactofthenewstandardonitsconsolidatedfinancialstatements.
InJanuary2016,theInternationalAccountingStandardsBoard(IASB)issuedamendmentstoclarifytherequirementsforrecognizingdeferredtaxassetson
unrealizedlosses.Theamendmentsclarifytheaccountingfordeferredtaxwhereanassetismeasuredatfairvalueandthatfairvalueisbelowtheassetstaxbase.
Theyalsoclarifycertainotheraspectsofaccountingfordeferredtaxassets.TheamendmentsareeffectivefortheyearbeginningonorafterJanuary1,2017.The
Companyiscurrentlyassessingtheimpactoftheseamendmentsonitsfinancialstatements.
InJune2016,theIASBissuedanamendmenttoIFRS2,Share-basedPayment,clarifyingtheaccountingforcertaintypesofshare-basedpaymenttransactions.The
amendmentsproviderequirementsonaccountingfortheeffectsofvestingandnon-vestingconditionsofcash-settledshare-basedpayments,withholdingtax
obligationsforshare-basedpaymentswithanetsettlementfeature,andwhenamodificationtothetermsofashare-basedpaymentchangestheclassificationofthe
transactionfromcash-settledtoequity-settled.TheamendmentsareeffectivefortheyearbeginningonorafterJanuary1,2018.TheCompanyiscurrently
assessingtheimpactofthisamendmentonitsfinancialstatements.
AmendmentstoIAS1,PresentationofFinancialStatements(IAS1)wereissuedbytheIASBinDecember2014.Theamendmentsclarifyprinciplesforthe
presentationandmaterialityconsiderationsforthefinancialstatementsandnotestoimproveunderstandabilityandcomparability.TheamendmentstoIAS1are
effectiveforannualperiodsbeginningonorafterJanuary1,2016.TheCompanyisevaluatingtheimpactofthisstandardonitsconsolidatedfinancialstatements.
F-20
Table of Contents
recordedusingtheacquisitionmethodofaccountinginaccordancewiththeguidanceforbusinesscombinationsresultinginanadjustmenttothebasisofallthe
acquirednetassetstotheirrespectivefairvaluesandtherecordingofintangibleassetsandgoodwillasoftheAcquisitiondateofDecember9,2013.
Thetotalpurchasepriceof$209,685wasallocatedtotangibleassetsacquired,liabilitiesassumedandidentifiableintangibleassetsbasedontheirrespectivefair
valuesasfollows:
Net assets $
Cashacquired 4,477
Tradereceivables 34,384
Inventories 43,544
Othercurrentassets 2,118
Property,plantandequipment 9,398
Accountspayableandaccruedliabilities (28,663)
Provisions (6,593)
Incometaxespayable (1,161)
Deferredincometaxes
(14,182)
Theconsiderationpaidcomprisedthefollowing:
Cash,financedthrough: $
ClassAseniorpreferredshares 53,144
Subordinateddebt 79,716
Long-termdebt
19,885
152,745
Issuanceof:1
ClassBseniorpreferredshares 22,776
ClassBjuniorpreferredshares
34,164
56,940
209,685
1 Asthecombinedvalueofthesepreferredshareswasinexcessoftheirrespectivelegalstatedcapital,thevaluewasallocatedtocontributedsurplus.
F-21
Table of Contents
Tradereceivablesandothercurrentassets,accountspayable,accruedliabilities,incometaxespayableandprovisionswerestatedattheirhistoricalcarryingvalues,
whichapproximatetheirfairvaluegiventheshorttermnatureoftheseassetsandliabilities.
Inventorieswererecordedatestimatedfairvalue,basedonnetrealizablevalue.Inthisvaluationapproach,fairvalueisestimatedbasedonanapproximationofthe
sellingpricelessthesumofcosttocompleteandaprofitallowanceforthecompletingandsellingeffortofthebuyer.
Theestimateoffairvalueofproperty,plantandequipmentwasbasedonmanagementsassessmentoftheacquiredassetscondition,aswellasanevaluationof
thecurrentmarketvalueforsuchassets.Inaddition,theCompanyalsoconsideredthelengthoftimeoverwhichtheeconomicbenefitoftheseassetsisexpectedto
berealizedandadjustedtheusefullifeofsuchassetsaccordinglyasofthevaluationdate.
TheCompanyrecordedidentifiableintangibleassetsbasedontheirestimatedfairvalue;thevalueoftheintangibleassetsderivesprimarilyfromtheCanadaGoose
brand.Managementusedtherelieffromroyaltyapproachtocalculatefairvalue.Thismethodentailsquantifyingroyaltypaymentswhichwouldberequiredifthe
assetwasownedbyathirdpartyandlicensedtoacompany.Theimputedroyaltypaymentstreamisthenadjustedfortaxesanddiscountedtopresentvalueusinga
risk-adjusteddiscountrate.
Theexcessofthepurchasepriceovertheamountsallocatedtospecificassetsandliabilitiesisincludedingoodwill.Thepremiuminthepurchasepricepaid
reflectstheexpectedfuturegrowthpotentialfromoperatingtheCompanysbusiness.Noneofthegoodwillrecognizedisexpectedtobedeductibleforincometax
purposes.
TotalacquisitioncostsrecognizedduringtheSuccessorperiodDecember9,2013March31,2014andthePredecessorperiodApril1,2013December8,2013
were$3,268and$2,293,respectively. DuringtheperiodendedMarch31,2014,6ClassAcommonshareswereissuedinexchangeforreimbursementofexpenses
intheamountof$3,350relatedtotheAcquisition.
IftheAcquisitionhadoccurredonApril1,2013,proformarevenueandnetincomeforthe12-monthperiodendedMarch31,2014wouldhavebeen$152,085and
$3,023,respectively.
Other Acquisitions
OnJanuary8,2015,theCompanyacquiredtheassetsofamanufacturingbusinessfortotalcashconsiderationof$1,800.TheacquisitionprovidestheCompany
withadditionalmanufacturingcapacityandcapabilitiesandhasbeenaccountedforasabusinesscombination.Theresultsofoperationshavebeenconsolidated
withthoseoftheCompanybeginningJanuary8,2015.
Thefairvalueofthetangibleassetsacquiredisafollows,withtheexcessofthepurchasepriceoverthefairvalueofthetangibleassetsacquiredaccountedforas
goodwill.
Assets acquired: $
Tangible assets
Property,plantandequipment(note11) 200
Inventory
10
210
Goodwill
1,590
F-22
Table of Contents
Thepurchasepricewaspaidasto$1,260ontheclosingdateofthetransaction,withtheremainingbalancepayable$270sixmonthsfollowingtheclosingdateand
$270payabletwelvemonthsfollowingtheclosingdate.
TheCompanydoesnotreporttotalassetsortotalliabilitiesbasedonitsoperatingsegments.
TheCompanysDirecttoConsumerbusinesscommencedintheyearendedMarch31,2015withtheestablishmentofane-commerceplatformforCanadian
customersthroughtheCompanyswebsite.Priortothisperiod,noactivityoccurredintheDirecttoconsumersegmentandthereforeinformationhasnotbeen
presented.
Operating income
94,366
10,081
(63,493)
40,954
Netinterestandotherfinancecosts
7,996
Operating income
45,577
4,481
(23,389)
26,669
Netinterestandotherfinancecosts
7,537
F-23
Table of Contents
TheCompanydeterminesthegeographiclocationofrevenuebasedonthelocationofitscustomers.
December 9, Predecessor
2013 to April 1 to
March 31 December 8
2016 2015 2014 2013
Revenue $ $ $ $
Canada 95,238 75,725 8,539 64,001
UnitedStates 103,413 56,990 4,165 29,401
RestofWorld 92,179
85,699
4,559
41,420
290,830
218,414
17,263
134,822
Successor Predecessor
December 9,
2013 to April 1 to
March 31 March 31 March 31, December 8
2016 2015 2014 2013
$ $ $ $
Current income tax expense (recovery)
Currentperiod 10,469 1,045 (410) 7,297
Adjustmentinrespectofpriorperiods
(45)
5
25
(86)
10,424
1,050
(385)
7,211
(3,951)
3,657
(4,669)
(1,661)
F-24
Table of Contents
TheeffectiveincometaxratesdifferfromtheweightedaveragebasicCanadianfederalandprovincialstatutoryincometaxratesforthefollowingreasons:
Successor Predecessor
December 9,
2013 to April 1 to
March 31 March 31 March 31, December 8
2016 2015 2014 2013
$ $ $ $
Income (loss) before income taxes
32,958
19,132
(20,531)
20,828
Thecomponentsofdeferredtaxassetsandliabilitiesareasfollows:
March 31 March 31
2016 2015
$ $
Lossescarriedforward 2,177 187
Employeefuturebenefits 70
Otherliabilities 1,720 1,987
Unrealizedprofitoninventory 1,184 77
Provisions
1,811
1,576
Totaldeferredtaxasset
6,962
3,827
Totaldeferredtaxliabilities
(16,089)
(16,997)
Netdeferredtaxliabilities (9,127)
(13,170)
Thedeferredtaxassetsandliabilitiesarepresentedinthestatementoffinancialpositionasfollows:
March 31 March 31
2016 2015
$ $
Deferredtaxasset 3,642 1,781
Deferredtaxliabilities
(12,769)
(14,951)
(9,127)
(13,170)
AllthedeferredincometaxassetswererecognizedbecauseitisprobablethatfuturetaxableincomewillbeavailabletotheCompanytoutilizethebenefits.
F-25
Table of Contents
ThecorporateentitieswithinCanadaGoosehavethefollowingtax-losscarry-forwardsthatareexpectedtoexpireinthefollowingyears,ifnotutilized.
$
2023 14,427
2034 707
2036 2,055
2037andthereafter
7
17,196
TheCompanydoesnotrecognizetaxonunremittedearningsfromforeignsubsidiariesasitismanagementsintenttoreinvesttheseearningsindefinitely.
Unremittedearningsfromforeignsubsidiarieswere$9,581asatMarch31,2016(2015$3,317,2014$1,325,andDecember8,2013$1,980).
Dilutedearningspershareamountsarecalculatedbydividingthenetincomeattributabletoordinaryequityholdersoftheparentbytheweightedaveragenumber
ofcommonsharesoutstandingduringtheperiodplustheweightedaveragenumberofcommonshares,ifany,thatwouldbeissuedonconversionofallthedilutive
potentialeffects.TheCompanyhasissuedpreferredsharesandsubordinateddebtandcertainstockoptions(TrancheBandTrancheCoptions,note17)thatare
convertible/exercisableintocommonsharesimmediatelypriortotheclosingofqualifyingliquidityeventorsaleofshares.Suchinstrumentsarenotconsidered
dilutiveuntiltheoccurrenceoftheeventthatwouldresultinconversionorexercise,andarenotincludedinthedeterminationofdilutedearningspershare.
Wherethenumberofcommonsharesandstockoptionsoutstandingchangesasaresultofasharesplit,thecalculationofbasicanddilutedearningspershareforall
periodspresentedisadjustedretrospectively;accordingly,theearningspersharehasbeencalculatedbelowaftergivingeffecttothesubdivisionofthecommon
sharesandtherelatedadjustmentstothenumberandexercisepricesofstockoptionswhichtookplaceonDecember2,2016(note22).
For the year ended March 31 For the period For the period
December 9, 2013 to April 1, 2013 to
2016 2015 March 31, 2014 December 8, 2013
$ $ $ $
Net income
26,485
14,425
(15,477)
15,278
Weighted average class A and class B common shares outstanding 100,000,000 100,000,000 100,000,000 97
Weightedaveragenumberofsharesonexerciseofstockoptions
1,680,207
1,211,134
Earningspershare
Basic 0.26 0.14 (0.15) 157,505.15
Diluted 0.26 0.14 (0.15) 157,505.15
F-26
Table of Contents
2016 2015
$ $
Tradereceivables 18,894 15,295
Less:allowancefordoubtfulaccounts
(1,419) (1,186)
ThefollowingarethecontinuitiesoftheCompanysexpectedcreditlossesonaccountsreceivablefromcustomers:
Successor Predecessor
December 9,
2013 to April 1 to
March 31 March 31 March 31, December 8,
2016 2015 2014 2013
$ $ $ $
Balance at the beginning of the period (1,186) (629) (628) (286)
Impairmentlossesrecognizedonreceivables (499) (729) 22 (478)
2016 2015
$ $
Rawmaterials 46,648 27,729
Work-in-process 4,706 5,168
Finishedgoods
68,152
36,879
Total inventories at the lower of cost and net realizable value 119,506
69,776
IncludedininventoryasatMarch31,2016areprovisionsintheamountof$3,773(March31,2015$2,813).
InconnectionwiththeAcquisition,acquiredassetsandliabilitieswererecordedontheCompanysconsolidatedstatementoffinancialpositionattheirfairvalue.
Thisresultedinafairvalueincreasetoinventoryonthedateofacquisitionof$5,767representingthedifferencebetweeninventorycostanditsfairvalue.This
differencewasrecognizedasachargetocostofgoodssoldduringtheyearendedMarch31,2015andtheperiodendedMarch31,2014of$2,861and$2,906,
respectively,astherelatedinventorywassold.
F-27
Table of Contents
Amountschargedtocostofsalescomprisethefollowing:
Successor Predecessor
December 9,
2013 to April 1 to
March 31 March 31 March 31, December 8
2016 2015 2014 2013
$ $ $ $
Costofgoodsmanufactured 143,857 129,034 14,483 81,094
Depreciation
1,349
771
225
519
145,206
129,805
14,708 81,613
Furniture
Plant Computer Leasehold Show and
equipment equipment improvements displays fixtures Total
Cost $ $ $ $ $ $
March 31, 2014 1,147 716 6,562 622 1,040 10,087
Additions 1,122 706 1,106 749 148 3,831
Businessacquisition(note5)
200
200
Furniture
Plant Computer Leasehold Show and
equipment equipment improvements displays fixtures Total
Accumulated depreciation $ $ $ $ $ $
March 31, 2014 35
32
190
40
21
318
Additions
173
190
610 178
78
1,229
F-28
Table of Contents
ThefollowingtablepresentsthechangesincostandaccumulatedamortizationoftheCompanysintangibleassetswithfinitelives:
Additions
947
5,825
6,772
Amortization
170
2,164
2,334
Amortization
430
547
2,164
3,141
Intangibleassetscomprisethefollowing:
2016 2015
$ $
Intangibleassetswithfinitelives 12,363 8,732
Intangibleassetswithindefinitelives
Brandname 112,977 112,977
Domainname
337
337
125,677
122,046
F-29
Table of Contents
registrationofthebrandnames,anddomainnamesateachexpirydateindefinitely,andexpectstheseassetstogenerateeconomicbenefitinperpetuity.Assuch,
theCompanyassessedtheseintangiblestohaveindefiniteusefullives.
TheCompanycompleteditsannualimpairmenttestsintheyearofacquisitionandin2016and2015forindefinitelifeintangibleassetsandconcludedthatthere
wasnoimpairment.
Key Assumptions
Thekeyassumptionsusedtocalculatethevalue-in-use(VIU)arethoseregardingdiscountrates,revenuegrowthrates,andchangesinmargins.Theseassumptions
areconsistentwiththeassumptionsusedtocalculateVIUforgoodwill(note13).
Date acquired $
Acquisition December8,2013 42,947
Other
January8,2015
1,590
BalanceasatMarch31,2016and2015 44,537
TheCompanycompleteditsannualimpairmenttestsintheyearofacquisitionandin2016and2015forgoodwillandconcludedthattherewasnoimpairment.
Key Assumptions
Thekeyassumptionsusedtocalculatethefairvaluelesscostsofdisposalarethoseregardingdiscountrates,revenuegrowthrates,andchangesinmargins.These
assumptionsareconsideredtobeLevel3inthefairvaluehierarchy.
Theweightedaveragecostofcapitalwasdeterminedtobe14.5%(201514.0%)andwasbasedonarisk-freerate,anequityriskpremiumadjustedforbetasof
comparablepubliclytradedcompanies,anunsystematicriskpremium,smallcountryriskpremium,country-specificriskpremium,anafter-taxcostofdebtbased
oncorporatebondyieldsandthecapitalstructureoftheCompany.CashflowprojectionswerediscountedusingtheCompanysafter-taxweightedaveragecostof
capital.
TheCompanyincludedfiveyearsofcashflowsinitsdiscountedcashflowmodel.Thecashflowforecastswereextrapolatedbeyondthefiveyearperiodusingan
estimatedlongtermgrowthrateof5.0%(20155.0%).ThebudgetedgrowthisbasedonthestrategicplansapprovedbytheCompanysBoard.
F-30
Table of Contents
2016 2015
$ $
Tradepayables 23,408 12,552
Accruedliabilities 7,032 3,811
Employeebenefits(note19) 4,228 4,063
Amountsduetorelatedparties(note19) 1,910 1,830
Otherpayables
1,873
1,113
Total 38,451
23,369
Theprovisionforwarrantyclaimsrepresentsthepresentvalueofmanagementsbestestimateofthefutureoutflowofeconomicresourcesthatwillberequired
undertheCompanysobligationsforwarrantiesundersaleofgoods.Theestimatehasbeenmadeonthebasisofhistoricalwarrantytrendsandmayvaryasaresult
ofnewmaterials,alteredmanufacturingprocessesorothereventsaffectingproductqualityandproduction.
Thesalescontractprovisionrelatestomanagementsestimatedcostoftheterminationofcertainthirdpartydealers,agentsanddistributors.
Termination
Warranty of sales
obligations contracts Other Total
$ $ $ $
Balance as at March 31, 2014 4,836 3,693 337 8,866
Additionalprovisionsrecognized 2,556 1,727 190 4,473
Reductionsresultingfromsettlement (1,770) (1,286) (3,056)
Other
8
8
Provisionsareclassifiedascurrentandnon-currentliabilitiesbasedonmanagementsexpectationofthetimingofsettlement,asfollows:
2016 2015
$ $
Currentprovisions 3,125 4,080
Non-currentprovisions 8,554 6,211
11,679 10,291
F-31
Table of Contents
ThecreditagreementgoverningourCreditFacilitycontainsanumberofrestrictivecovenantsthatimposeoperatingandfinancialrestrictionsonus,including
restrictionsonourabilitytoincurcertainliens,makeinvestmentsandacquisitions,incurorguaranteeadditionalindebtedness,paydividendsormakeother
distributionsinrespectof,orrepurchaseorredeemourcommonorpreferredshares,orenterintocertainothertypesofcontractualarrangementsaffectingour
subsidiariesorindebtedness.
Advancesundertherevolvingcreditfacilityshallonlybeusedforworkingcapitalandothergeneralcorporatepurposesincludingpermittedacquisitions.
Thetermcreditfacilityisanon-revolvingfacilityandnoamountsrepaidunderthetermcreditfacilitymaybere-borrowedexceptforconversionsandrollovers.
Thelimitsofthetermcreditfacilitywillbeautomaticallyandpermanentlyreducedbytheamountofanyrepayment.Theprincipalamountofthetermcredit
facilityisrepayablein19equalquarterlyinstalmentsof$313eachcommencingonMarch31,2014andtheremainingbalancerepayableatthematuritydate.
2016 2015
CreditFacility $ $
Revolvingcreditfacility 45,515 19,155
Termcreditfacility
9,687
10,938
55,202 30,093
Less:deferredfinancingfees
1,008
1,052
54,194 29,041
Less:Currentportionoftermcreditfacility
1,250
1,250
AsatMarch31,2016,thecompanyhadlettersofcreditoutstandingundertheCreditFacilityof$294(US$227(2015$159,US$125).
FutureminimumprincipalrepaymentsofthetermcreditfacilityasatMarch31,2016are:
$
2017 1,250
2018 1,250
2019
52,702
55,202
F-32
Table of Contents
Subordinated debt
TheCompanyssubordinateddebtcomprisesseniorandjuniornotesthatareduetoanentityrelatedtothemajorityshareholderoftheCompanyandhasamaturity
dateofNovember30,2023(collectively,SubordinatedDebt).TheseniorsubordinateddebtwasissuedaspurchaseconsiderationintheAcquisitionandbears
interestattherateof6.7%perannum.Thejuniorsubordinateddebtisissuedtosettleallorsomeoftheaccruedinterestontheseniorsubordinateddebt.Any
accruedandunpaidinterestontheprincipalamountispayableincashannuallyonthelastbusinessdayofNovembereachyearbeginninginNovember2014.The
entireunpaidprincipalandaccruedinterestamountsareautomaticallyconvertibletoClassAcommonsharesinconnectionwithaqualifyingandnon-qualifying
liquidityeventorsaleofshares,wind-up,changeincontrolthroughabusinesscombination,merger,orasimilartransaction,asaleofsubstantiallyallofthe
Companysassets,orasaleofalloftheoutstandingequityoftheCompany.TheCompanysSubordinatedDebtcontainsaredemptionfeaturethatgiverisetoa
derivativewhichhavebeendeterminednottobecloselyrelatedtothehost.Novaluehasbeenattributedtothisderivative.
Senior Junior
Subordinated Subordinated
Note Note Total
$ $ $
March31,2014 79,716
79,716
Issuance
2,626
2,626
March31,2015
79,716
2,626
82,342
Issuance
2,964
2,964
March31,2016
79,716
5,590
85,306
Successor Predecessor
December 9,
2013 to April 1 to
March 31 March 31 March 31, December 8
2016 2015 2014 2013
$ $ $ $
Interestexpense
Creditfacility 2,236 1,551 351 1,283
Subordinateddebt 5,598 5,398 1,335
Bankoverdraft 17 109 2 145
Other 14 61 101 387
Standbyfees
136
427
7,996
7,537
1,788 1,815
F-33
Table of Contents
ClassBseniorpreferredshares,voting;non-cumulativedividendofuptoamaximumamountequaltotheClassBseniorliquidityprice;automaticconversioninto
avariablenumberofClassBcommonsharesinaccordancewiththeCompanysshareholderagreementimmediatelypriortoclosingofqualifyingliquidityevent
orsaleofshares.
ClassAseniorpreferredshares,voting;non-cumulativedividendofuptoamaximumamountequaltotheClassAseniorliquidityprice;automaticconversioninto
avariablenumberofClassAcommonsharesinaccordancewiththeCompanysshareholderagreementimmediatelypriortoclosingofqualifyingliquidityevent
orsaleofshares.
ClassAjuniorpreferredshares,non-voting,nodividends,automaticconversionintoavariablenumberofClassAcommonsharesinaccordancewiththe
Companysshareholderagreementintheeventofliquidityeventorsaleofshares.
ClassCjuniorpreferredshares,non-voting,nodividends,automaticconversionintoavariablenumberofClassBcommonsharesinaccordancewiththe
Companysshareholderagreementintheeventofliquidityeventorsaleofshares.NoClassCjuniorpreferredshareshavebeenissuedtodate.
F-34
Table of Contents
Eachclassofpreferredsharesisconvertibletocommonsharesasfollows:
Notes:
(1) ClassASeniorLiquidityPrice$1.00persharelesstheamountofanyClassAseniorpreferredsharedistributionssinceissuance.
(2) ClassAJuniorLiquidityPrice$1.00persharemultipliedby1.06tothepowerofcompleteannualperiodssincefiscal2014.
(3) ClassBSeniorLiquidityPrice$1.00persharelesstheamountofanyClassBseniorpreferredsharedistributionssinceissuance.
(4) ClassBJuniorOriginalIssuePrice$1.00persharelessanyClassBseniorpreferredsharedistributionssinceissuance.
(5) ClassCJuniorIssuePriceThedifferencebetweentheClassBJuniorLiquidityPriceandtheClassBOriginalIssuePriceforwhichtheClassBJunior
LiquidityPriceisequalto$1.00persharemultipliedby1.06tothepowerofcompleteannualperiodssincefiscal2014.
F-35
Table of Contents
Issued
CommonandpreferredsharesissuedasatMarch31,2015and2016areasfollows:
2016 2015
Number $ Number $
Common shares
ClassA 70,000,000 3,350 70,000,000 3,350
ClassB 30,000,000
30,000,000
Commonsharesoutstanding 100,000,000
3,350
100,000,000
3,350
Preferred shares
ClassAseniorpreferred 53,144,000 53,144 53,144,000 53,144
ClassBseniorpreferred
22,776,000
22,776,000
75,920,000 53,144
75,920,000 53,144
37,590,892 3,727
35,823,577 1,751
Subsequenttotheendoftheyear,onDecember2,2016,theCompanysubdivideditsClassAandClassBcommonsharesonthebasisof10,000,000common
sharesforeveryshareaspartofacapitalreorganization(note22).AftertheRecapitalization,theCompanyhas100,000,000ClassAandClassBcommonshares
outstanding.Theabovetablereflectsthenumberofcommonsharesoutstandingaftergivingeffecttothesharesplit.Thecalculationofbasicanddilutedearnings
pershare(note8)isbasedonthenumberofcommonsharesandstockoptionsoutstandingaftergivingeffecttothesharesplit.
DuringtheperiodendedMarch31,2014,60,000,000ClassAcommonshareswereissuedinexchangeforreimbursementofexpensesintheamountof$3,350
relatedtotheAcquisition.
Service-vested options
Service-vestedoptions,whichareherebyreferredtoTrancheAoptions,aresubjecttotheexecutivescontinuingemploymentandgenerallyarescheduledtovest
40%onthesecondanniversaryofthedateofgrant,20%onthethirdanniversary,20%onthefourthanniversaryand20%onthefifthanniversary.
F-36
Table of Contents
Compensationexpenseforshare-basedcompensationgrantedismeasuredatthefairvalueatthegrantdatewherethereisasharedunderstanding,usingtheMonte
Carlovaluationmodel.
Stockoptiontransactionsareasfollows:
Optionsgrantedtopurchaseshares:
TrancheA $ 2.06to$3.55 983,926
TrancheB $ 2.06to$3.55 983,933
TrancheC
$ 2.06to$3.55
983,940
2,951,799
Optionscancelled:
TrancheA $ 1.00to$1.25 (407,719)
TrancheB $ 1.00to$1.25 (407,719)
TrancheC
$ 1.00to$1.25
(407,719)
(1,223,157)
Duringfiscalyear2015,theCompanygrantedTrancheAoptionstoacquire2,214,334sharesat$1.00persharethatvest40%onDecember9,2015,20%on
December9,2016,20%onDecember9,2017and20%onDecember9,2018.Alloptionsgrantedsubsequentlyvest40%onthesecondanniversaryofthedateof
grant,20%onthethirdanniversary,20%onthefourthanniversaryand20%onthefifthanniversary.Alloptionsbecomeeligibletovestonachangeofcontrol
transactionwithcertainotherspecifiedevent-basedcriteria.
AsatMarch31,20161,068,500optionsarevested(2015Nil).
F-37
Table of Contents
ThefollowingtablesummarizesinformationaboutstockoptionsoutstandingandexercisableatMarch31,2016:
Subsequenttotheendoftheyear,onDecember2,2016,theCompanyamendedthetermsofitsstockoptionplanandadjustedthetermsofitsoutstandingstock
optionstogiveeffecttothesubdivisionofitscommonsharesandrelatedRecapitalizationtransactions(note22).AftertheRecapitalization,therearestockoptions
outstandingtopurchase6,359,785commonsharesatexercisepricesrangingfrom$0.02to$8.94pershare.Thetablesabovedonotgiveeffecttothesharesplit
andrelatedchangestothetermsofthestockoptionsoutstanding.Thecalculationofbasicanddilutedearningspershare(note8)isbasedonthenumberof
commonsharesandstockoptionsoutstandingaftergivingeffecttothesharesplit.
F-38
Table of Contents
Indeterminingtheamountofshare-basedcompensation,theCompanyusedtheMonteCarlomethodtoestablishthefairvalueofoptionsgrantedbyapplyingthe
followingassumptionsandinputs:
2016 2015
Stockpricevaluation $2.65to$3.86 $1.10to$2.65
Exerciseprice $2.06to$3.55 $1.00to$2.06
Risk-freeinterestrate 0.51% 0.57%
Expectedlifeinyears 10 10
Expecteddividendyield % %
Volatility 30% 30%
Fairvalueofoptionsissuedintheperiods $ 1.41 $ 0.12
Managementassessedthatthecreditfacilityhadafairvalueof$46,179(2015$49,822),determinedusingadiscountedcashflowmodeloverthetermofthedebt
andadiscountrateof8.5%(20158%).Thefairvalueofthesubordinateddebtisbasedontheequivalentdollaramountofcommonsharesthataretobereceived
uponconversionofthesubordinateddebt,andisequaltothecarryingamountofthedebt.
TheCompanysderivativefinancialassetsandfinancialliabilitiesaremeasuredatfairvalueattheendofeachreportingperiod.Thefollowingtablegives
informationabouthowthefairvaluesofthesefinancialassetsandfinancialliabilitiesaredetermined(inparticular,thevaluationtechnique(s)andinputsused).
Anunrealizedmark-to-marketgainof$5,366(2015$138;2014$339loss;December8,2013$743loss)onforwardexchangecontractshasbeenrecorded
selling,generalandadministrativeexpensesinthestatementofincome.
F-39
Table of Contents
ThefollowingtablepresentsthefairvaluesandfairvaluehierarchyoftheCompanysfinancialinstrumentsandexcludesfinancialinstrumentscarriedatamortized
costthatareshort-terminnature:
Therewerenotransfersbetweenthelevelsofthefairvaluehierarchy.
AsatMarch31,2016,accruedinterestduetothesameentityfor$1,910(2015$1,830)isincludedintheaccountspayableandaccruedliabilities.
Amounts owed
Balanceswithrelatedparties to related parties
$
March31,2016 1,910
March31,2015 1,830
F-40
Table of Contents
Successor Predecessor
December 9,
2013 to April 1 to
March 31 March 31 March 31, December 8
2016 2015 2014 2013
$ $ $ $
Shorttermemployeebenefits 3,484 4,042 714 1,568
Longtermemployeebenefits 12
Share-basedcompensation
186
144
Capital management
TheCompanymanagesitscapital,whichconsistsofcashprovidedfromfinancing(commonsharesandpreferredshares),long-termdebtandsubordinateddebt,
withtheprimaryobjectivebeingsafeguardingsufficientworkingcapitaltosustainandgrowoperations.TheBoardofDirectorshasnotestablishedcapital
benchmarksorothertargets.TheCompanywillcontinuallyassesstheadequacyofitscapitalstructureandcapacityandmakeadjustmentswithinthecontextofthe
Companysstrategy,economicconditions,andtheriskcharacteristicsofthebusiness.
TheCompanyiscapitalizedwithamixofdebt(long-termandsubordinateddebt)andwithequity(commonsharesandpreferredshares).TheCompanyisexposed
tomarketrisk,creditrisk,andliquidityrisk.TheCompanysseniormanagementandBoardofDirectorsoverseesthemanagementoftheserisks.Itisthe
Companyspolicythatnotradinginderivativesforspeculativepurposesshallbeundertaken.TheBoardofDirectorsreviewsandagreespoliciesformanaging
eachoftheseriskswhicharesummarizedbelow.
Market risk
Marketriskistheriskthatthefairvalueoffuturecashflowsofafinancialinstrumentwillfluctuatebecauseofchangesinmarketprices.Marketpricescomprise
interestrateriskandforeigncurrencyrisk.
F-41
Table of Contents
performanceoftheCompany.Fortheprimerateloanthisratemayvarybetween1.5%to3.37%,whilethebankersacceptanceratemayvarybetween2.5%to
4.375%;bothnotesincludeastandbyfeerateof0.875%.Fortheyear-endedMarch31,2016,a1%increaseintheinterestratewouldresultinadditionalinterest
expenseof$627.
AtMarch31,2016,theCompanyhadforeignexchangeforwardcontractstobuyCanadiandollarsrepresentingnotionalamountsofUS$30,500tosellU.S.dollars,
4,000tosellEuros,and1,500tosellPoundsSterling(March31,2015tobuyCanadiandollars:notionalamountsofUS$16,200tosellU.S.dollars,12,000to
sellEuros,and2,000tosellPoundsSterling;tosellCanadiandollars1,000tobuyEurosand1,000tobuyPoundsSterling).
RevenuesandexpensesofallforeignoperationsaretranslatedintoCanadiandollarsattheforeigncurrencyexchangeratesthatapproximatetheratesineffectat
thedateswhensuchitemsarerecognized.AppreciatingforeigncurrenciesrelativetotheCanadiandollarwillpositivelyimpactoperatingincomeandnetincome,
whiledepreciatingforeigncurrenciesrelativetotheCanadiandollarwillhavetheoppositeimpact.
TheCompanyisalsoexposedtofluctuationsinthepricesofU.S.dollardenominatedpurchasesasaresultofchangesinU.S.dollarexchangerates.Adepreciating
CanadiandollarrelativetotheU.S.dollarwillnegativelyimpactoperatingincomeandnetincome,whileanappreciatingCanadiandollarrelativetotheU.S.dollar
willhavetheoppositeimpact.
Credit risk
Creditriskistheriskthatcounterpartywillnotmeetitsobligationsunderafinancialinstrumentorcustomercontract,leadingtoafinancialloss.
Creditriskarisesfromthepossibilitythatcertainpartieswillbeunabletodischargetheirobligations.TheCompanyhasasignificantnumberofcustomerswhich
minimizestheconcentrationofcreditrisk.TheCompanydoesnothaveanycustomerswhichaccountformorethan10%ofsalesoraccountsreceivable.The
Companyhasenteredintoanagreementwithathirdpartywhohasinsuredtheriskoflossforupto90%ofaccountsreceivablefromcertaindesignatedcustomers
basedonatotaldeductibleof$50.AsatMarch31,2016,accounts
F-42
Table of Contents
receivabletotalingapproximately$16,785(March31,2015$12,497,March31,2014$3,666)wasinsuredunderthisagreement.Inaddition,theCompany
routinelyassessesthefinancialstrengthofitscustomersand,asaconsequence,believesthatitsaccountsreceivablecreditriskexposureislimited.Customer
depositsarereceivedinadvancefromcertaincustomersforseasonalorders,andappliedtoreduceaccountsreceivablewhengoodsareshipped.Credittermsare
normallysixtydaysforseasonalorders,andthirtydaysforre-orders.
Theagingtradereceivablesisasfollows:
Liquidity risk
LiquidityriskistheriskthattheCompanywillnotbeabletomeetitsfinancialobligationsastheyfalldue.TheCompanysapproachtomanagingliquidityisto
ensure,asfaraspossible,thatitwillalwayshavesufficientliquiditytomeetitsliabilitieswhendue,undernormalandstressedconditions.TheCompanymanages
liquidityriskbyreviewingitscapitalandoperatingrequirementsonanongoingbasis.TheCompanycontinuouslyreviewsbothactualandforecastedcashflowsto
ensurethattheCompanyhasappropriatecapitalcapacity.
ThefollowingtablesummarizestheamountofcontractualundiscountedfuturecashflowrequirementsforfinancialinstrumentsasatMarch31,2016:
2020 to
Contractual obligations 2017 2018 2019 2024 Total
$ $ $ $ $
Accountspayableandaccruedliabilities 38,451 38,451
SubordinatedDebt 85,306 85,306
Long-termcreditfacility 1,250 1,250 52,702 55,202
TheCompanyaccruesexpenseswhenincurred.Accountsaredeemedpayableonceapasteventoccursthatrequirespaymentbyaspecificdate.
F-43
Table of Contents
Commitments
Leases
TheCompanyhasleasecommitmentsforthefutureperiods,expiringasfollows:
As at
March 31,
2016
$
Notlaterthan1year 5,407
Laterthan1yearandnotlaterthan3years 14,069
Laterthan4yearsandnotlaterthan5years 13,908
Laterthan5years
30,753
64,137
Operatingleasesrelatetoleasesofrealestatewithleasetermsofbetween5and10years.Alloperatingleasecontractsover5yearscontainclausesfor5-yearly
marketrentalreviews.TheCompanydoesnothaveanoptiontopurchasetheleasedlandattheexpiryoftheleaseperiods.
Successor Predecessor
December 9,
2013 to April 1 to
March 31 March 31 March 31, December 8,
2016 2015 2014 2013
Tradereceivables (3,366) (9,241) 29,516 (28,663)
Inventories (49,778) (10,622) (15,373) 15,394
Othercurrentassets (2,016) 840 (3,011) (755)
Accountspayableandaccruedliabilities 15,945 105 (7,769) 9,769
Provisions 1,388 1,425 2,273 382
Other
(21)
(37,848)
(17,493)
5,636
(3,873)
F-44
Table of Contents
Non-cashtransactionsintheyearinclude:
Successor Predecessor
December 9,
2013 to April 1 to
March 31 March 31 March 31, December 8,
2016 2015 2014 2013
IssuanceofClassBseniorpreferredshares 22,776
IssuanceofClassBjuniorpreferredshares 34,164
TheCompanyusedtheproceedsfromtheRevolvingFacilitytorepayandextinguishtheexistingcreditfacility.Asaresultoftheextinguishmentoftheexisting
creditfacility,deferredfinancingchargesintheamountof$1,081werechargedtoexpense.
Business combination
OnApril18,2016,subsequenttotheyear-end,theCompanyacquiredtheassetsofamanufacturingbusinessforcashconsiderationof$1,500.
Thefairvalueofthetangibleassetsacquiredisafollows,withtheexcessofthepurchasepriceoverthefairvalueofthetangibleassetsacquiredaccountedforas
goodwill.TheCompanyhasnotyetfinalizeditspurchaseaccountinginrespectofthisacquisitionpendingfinalizationofthefairvalueofthetangibleassets
acquired.
Assets acquired $
Tangible assets
Property,plantandequipment
1,000
1,000
Goodwill
500
Thepurchasepricewaspaidasto$500ontheclosingdateofthetransaction,withanamountpayableof$500onAugust1,2017andcontingentconsiderationwith
afairvalueof$500,owingtotheformerownersuponsatisfactionofadditionalrequirements.Thecontingentconsiderationwillberemeasuredatitsfairvalueat
subsequentreportingdatesandanyresultinggainorlossincludedinthestatementofincome.
F-45
Table of Contents
Recapitalization transactions
OnDecember2,2016,theBoardofDirectorsapprovedandtheCompanycompletedaseriesofsharecapitalanddebttransactions(collectively,the
Recapitalization)tosimplifyitssharecapitalstructureandtoreturncapitaltoitsshareholders.Theeffectofthesetransactionsissummarizedasfollows:
a) Thecompanyenteredintoaseniorsecuredloanagreement(theTermLoan).
b) WiththeproceedsoftheTermLoan,theCompanyrepaiditssubordinateddebtandaccruedinterest.
c) TheCompanyamendeditsarticlestopermitasharecapitalreorganizationwiththeresultthatitsclassesofpreferredshareswerecancelledandits
existingcommonsharesweresubdivided.TheamendmentspermittheCompanyinfuturetoissuepreferredsharesinseries,ofwhich,exceptfor
63,576,003ClassDpreferredshares,nonearecurrentlyoutstanding.
d) TheproceedsoftheTermloanwerealsousedinconnectionwiththesharecapitalreorganizationtoredeemcertainoutstandingshares,tomakecertain
returnofcapitaldistributionsonoutstandingcommonshares,andtofundasecured,non-interestbearingloantoDTRLLC,acompanyindirectly
controlledbythePresident,ChiefExecutiveOfficerandshareholderoftheCompany.
e) TheCompanyamendedthetermsofitsstockoptionplanandchangedthetermsofoutstandingstockoptionstoconformwiththerevisedsharecapital
terms.
Term Loan
OnDecember2,2016,inconnectionwiththeRecapitalization,theCompanyenteredintoaseniorsecuredloanagreementwithasyndicateoflenders,theTerm
Loan,thatissecuredonasplitcollateralbasisalongsidetheCreditFacility,inanaggregateprincipalamountof$216,738(US$162,582).TheCompanyincurred
anoriginalissuediscountof$6,376andtransactioncostsof$2,052ontheissuanceoftheTermLoan.TheTermLoancurrentlybearsinterestatarateofLIBOR
plusanapplicablemarginof5%,payablequarterlyorattheendofthethencurrentinterestperiod(whicheverisearlier)inarrears.
TheTermLoanisdueonDecember2,2021,andisrepayableinquarterlyamountsofUS$406beginningJune30,2017.AmountsowingundertheTermLoan
mayberepaidatanytimewithoutpremiumorpenalty,butoncerepaidmaynotbereborrowed.
TheTermLoanissecuredbyinventoryandtradereceivablesandcontainsfinancialandnon-financialcovenantswhichcouldimpacttheCompanysabilitytodraw
funds.
Subordinated debt
OnDecember2,2016,inconnectionwiththeRecapitalization,theCompanyrepaidtheoutstandingamountofitssubordinateddebtplusaccruedinterestowingto
anentityrelatedtothemajorityshareholderoftheCompanyasfollows:
$
Seniorsubordinatednote 79,716
Juniorsubordinatednote 5,590
Accruedinterest
5,732
91,038
TherepaymentwasfinancedwiththeproceedsoftheTermLoan.
F-46
Table of Contents
Shareholders equity
InconnectionwiththeRecapitalization,thefollowingsharecapitaltransactionswerecompletedonDecember2,2016:
The53,144,000outstandingClassAseniorpreferredshareswereredeemedfortheircapitalamountof$53,144.
The3,426,892outstandingClassAjuniorpreferredshareswereredeemedundertheirtermsfortheirliquidityvalueof$4,063.
ThecompanyhassubdividedtheexistingClassAandClassBcommonsharesonthebasisof10,000,000commonsharesforeveryshare.
Areturnofcapitalof$698waspaidontheClassAcommonshares.
Inaseriesoftransactions,theoutstandingClassBseniorpreferredshares,theClassBjuniorpreferredsharesandtheClassBcommonshareshavebeenexchanged
into63,576,003ClassDpreferredshareswithafixedvalueof$63,576and30,000,000ClassAcommonshares.
AftertheRecapitalization,theCompanyhas100,000,000ClassAcommonsharesand63,576,003ClassDpreferredsharesoutstanding.Therearestockoptions
outstandingtopurchase6,306,602ClassAcommonsharesatexercisepricesrangingfrom$0.02to$8.94pershare.
Wherethenumberofcommonsharesandstockoptionsoutstandingchangesasaresultofasharesplit,thecalculationofbasicanddilutedearningspershareforall
periodspresentedisadjustedretrospectively;accordingly,theearningspershareforallperiodspresentedinthestatementofincomeandinnote8havebeen
calculatedaftergivingeffecttothesubdivisionofthecommonsharesandtherelatedadjustmentstothenumberandexercisepricesofstockoptions.
Shareholder advance
InconnectionwiththeRecapitalization,theCompanymadeasecurednon-interestbearingshareholderadvanceof$63,576toDTRLLC,anentityindirectly
controlledbythePresidentandChiefExecutiveOfficer.Theshareholderadvancewillbeextinguishedbyitssettlementagainsttheredemptionpriceforthe
redemptionoftheClassDpreferredshares.DTRLLChaspledgedalloftheClassDpreferredsharesascollateralfortheshareholderadvance.Redemptionofthe
ClassDpreferredsharesandsettlementoftheshareholderadvanceisexpectedtooccurpriortothetimetheregistrationstatementrelatingtothisofferingisfiledin
theUnitedStates.
F-47
Table of Contents
SCHEDULEICONDENSEDFINANCIALINFORMATIONOF
CANADAGOOSEHOLDINGSINC.
(PARENTCOMPANY)
AlloperatingactivitiesoftheCompanyareconductedbythesubsidiaries.CanadaGooseHoldingsInc.isaholdingcompanyanddoesnothaveanymaterial
assetsorconductbusinessoperationsotherthaninvestmentsinsubsidiaries.ThecreditagreementofCanadaGoose,Inc,awhollyownedsubsidiaryofCanada
GooseHoldingsInc.,containsprovisionswherebyCanadaGooseInc.hasrestrictionsontheabilitytopaydividends,loanfundsandmakeotherupstream
distributionstoCanadaGooseHoldingsInc.
Thesecondensedparentcompanyfinancialstatementshavebeenpreparedusingthesameaccountingprinciplesandpoliciesdescribedinthenotestothe
consolidatedfinancialstatements.Refertotheconsolidatedfinancialstatementsandnotespresentedaboveforadditionalinformationanddisclosureswithrespect
tothesecondensedfinancialstatements.
F-48
Table of Contents
PARENTCOMPANYINFORMATION
CanadaGooseHoldingsInc.
ScheduleICondensedStatementsofIncome(Loss)
31-Mar
For the period from
December 9, 2013
2016 2015 to March 31, 2014
Equity in comprehensive income (loss) of subsidiary 26,155 14,640 (12,129)
Selling,generalandadministrationexpenses 500 300 3,350
OtherExpenses(income)
NetInterestincomeandotherfinancecosts
(8)
(8)
(2)
Incometaxrecovery
(130)
(77)
Theaccompanyingnotestothecondensedfinancialstatementsareanintegralpartofthisfinancialstatement.
F-49
Table of Contents
PARENTCOMPANYINFORMATION
CanadaGooseHoldingsInc.
ScheduleICondensedStatementsofFinancialPosition
YearEndedMarch31
2016 2015
Current Assets
Cash 99 8
Othercurrentassets
35
Subordinateddebt
85,306
82,342
Equity
Sharecapital 60,221 58,245
Contributedsurplus 57,740 57,240
Retainedearnings
24,741
(1,052)
Equity 142,702
114,433
Theaccompanyingnotestothecondensedfinancialstatementsareanintegralpartofthisfinancialstatement.
F-50
Table of Contents
PARENTCOMPANYINFORMATION
CanadaGooseHoldingsInc.
ScheduleICondensedStatementsofCashFlows
31-Mar
For the period from
December 9, 2013
2016 2015 to March 31, 2014
CASHFLOWSFROMOPERATINGACTIVITIES
0 (3,348)
Changesinassetsandliabilities 87 3 (4,479)
CASHFLOWSFROMINVESTINGACTIVITIES
AcquisitionofCanadaGooseInc.netassetsandsubsidiaries (148,268)
Investmentinsubsidiary (1,976) (1,751)
Loantosubsidiary
(2,964)
(2,626)
CASHFLOWSFROMFINANCINGACTIVITIES
IssueofClassAseniorpreferredshares 53,144
IssueofClassAjuniorpreferredshares 1,976 1,751
Issueofcommonshares 3,350
Issuanceofsubordinateddebt 2,964 2,626 79,716
Borrowingsonacquisition
19,885
Increase in cash
91
8
Cash,beginningofperiod
8
Theaccompanyingnotestothecondensedfinancialstatementsareanintegralpartofthisfinancialstatement.
F-51
Table of Contents
PARENTCOMPANYINFORMATION
CanadaGooseHoldingsInc.
ScheduleINotestotheCondensedFinancialStatements
(inthousandsofCanadiandollars)
1. BASIS OF PRESENTATION
CanadaGooseHoldingsInc.(theParentCompany)isaholdingcompanythatconductssubstantiallyallofitsbusinessoperationsthroughitssubsidiary.The
ParentCompany(aBritishColumbiacorporation)wasincorporatedonNovember21,2013.
TheParentCompanyhasaccountedfortheearningsofitssubsidiaryundertheequitymethodintheseunconsolidatedcondensedfinancialstatements.
F-52
Table of Contents
(inthousandsofCanadiandollars,exceptpershareamounts)
Three months ended Nine months ended
December 31 December 31
Notes 2016 2015 2016 2015
$ $ $ $
Revenue 5 209,051 115,504 352,681 248,909
Cost of sales
8 88,767
51,575 168,403
122,107
Othercomprehensiveloss
(322)
(729)
Theaccompanyingnotestothecondensedinterimconsolidatedfinancialstatementsareanintegralpartofthisfinancialstatement
F-53
Table of Contents
(inthousandsofCanadiandollars)
December 31, March 31,
Notes 2016 2016
Assets $ $
Current assets
Cash 30,180 7,226
Tradereceivables 7 88,982 17,475
Inventories 8 96,680 119,506
Othercurrentassets
15
11,539
10,525
Liabilities
Current liabilities
Accountspayableandaccruedliabilities 9 64,242 38,451
Provisions 10 12,473 3,125
Incometaxespayable 4,500 7,155
Currentportionoflong-termdebt
1,637
1,250
Theaccompanyingnotestothecondensedinterimconsolidatedfinancialstatementsareanintegralpartofthisfinancialstatement.
F-54
Table of Contents
(inthousandsofCanadiandollars)
Accumulated
Retained Other
Contributed Earnings Comprehensive
Share Capital Surplus (Deficit) Loss Total
Common Preferred
Notes Shares Shares Total
$ $ $ $ $ $ $
Balance as at March 31, 2016 3,350 56,871 60,221 57,740 25,433 (692) 142,702
Recapitalizationtransactions: 12
RedemptionofClassAseniorpreferredshares (53,144) (53,144) (53,144)
RedemptionofClassAjuniorpreferredshares (3,727) (3,727) (336) (4,063)
ReturnofcapitalonClassAcommonshares (698) (698) (698)
ExchangeallClassBpreferredandcommonshares
forClassDpreferredsharesandClassAcommon
shares (56,940) (6,636) (63,576)
Netincomefortheperiod 45,071 45,071
Othercomprehensiveloss,netoftax (729) (729)
Recognitionofshare-basedcompensation
13
2,536
2,536
Balance as at March 31, 2015 3,350 54,895 58,245 57,240 (1,052) 114,433
Netincomefortheperiod 35,687 35,687
Issuanceofpreferredshares 1,976 1,976 1,976
Recognitionofshare-basedcompensation
13
375
375
Theaccompanyingnotestothecondensedinterimconsolidatedfinancialstatementsareanintegralpartofthisfinancialstatement.
F-55
Table of Contents
79,865 56,397
Changesinnon-cashoperatingitems 17 (18,249) (56,206)
Incometaxespaid (17,017) (3,289)
Interestpaid
(7,895)
(6,848)
Theaccompanyingnotestothecondensedinterimconsolidatedfinancialstatementsareanintegralpartofthisfinancialstatement.
F-56
Table of Contents
TheCompanycomprisesCGHIanditswholly-ownedsubsidiary,CanadaGooseInc.(CGI).CGImanufacturescoldweatherouterwearandwholly-ownsCanada
GooseUS,Inc.(CGUS),CanadaGooseTradingInc.(CGTI),andCanadaGooseInternationalHoldingsLimited(U.K.Holdings).U.K.Holdingswholly-
ownsCanadaGooseEuropeAB(CGE),CanadaGooseInternationalAG(SwissCo)andCanadaGooseServicesLimited(U.K.Serviceco).
Operating Segments
TheCompanyclassifiesitsbusinessintwooperatingandreportablesegments:WholesaleandDirecttoConsumer.TheWholesalebusinesscomprisessalesmade
toamixoffunctionalandfashionableretailers,includingmajorluxurydepartmentstores,outdoorspecialitystores,andindividualshops.TheCompanysproducts
reachtheseretailersthroughanetworkofinternationaldistributorsanddirectdelivery.
TheDirecttoConsumerbusinesscomprisessalesthroughthecountry-specifice-commerceplatformsanditsretailstores.
Financialinformationforthetworeportableoperatingsegmentsisincludedinnote4.
Seasonality
Weexperienceseasonalfluctuationsinourrevenueandoperatingresultsandhistoricallyhaverealizedasignificantportionofourrevenueandincomefortheyear
duringoursecondandthirdfiscalquarters.
Workingcapitalrequirementstypicallyincreaseduringthefirstandsecondquartersofthefiscalyearasinventorybuildstosupportpeakshippingandselling
periodsand,accordingly,typicallydecreaseduringthefourthquarterofthefiscalyearasinventoryhasbeenshippedandsold.Cashprovidedbyoperating
activitiesistypicallyhigherinthefourthquarterofthefiscalyearduetoreducedworkingcapitalrequirementsduringthatperiod.
ThecondensedinterimconsolidatedfinancialstatementsoftheCompanyasatDecember31,2016andMarch31,2016andforthethreeandninemonthperiods
endedDecember31,2016and2015wereauthorizedforissueinaccordancewitharesolutionoftheCompanysBoardofDirectorsonFebruary6,2017.
F-57
Table of Contents
Basis of presentation
ThesignificantaccountingpoliciesandcriticalaccountingestimatesandjudgmentsasdisclosedintheCompanysMarch31,2016annualconsolidatedfinancial
statementshavebeenappliedconsistentlyinthepreparationofthesecondensedinterimconsolidatedfinancialstatements.Thecondensedinterimconsolidated
financialstatementsarepresentedinCanadiandollars,theCompanysfunctionalandpresentationcurrency.
ThedisclosurescontainedintheseinterimstatementsdonotincludealltherequirementsinIFRS.Accordingly,thesecondensedinterimconsolidatedfinancial
statementsshouldbereadinconjunctionwiththeCompanysMarch31,2016annualconsolidatedfinancialstatementsandtheaccompanyingnotesandhavebeen
preparedusingtheaccountingpoliciesdescribedinNote2totheannualfinancialstatements,exceptasnotedbelow.
TheCompanyadoptedamendmentstoIAS1,PresentationofFinancialStatementswhichiseffectiveforannualperiodsbeginningonorafterJanuary1,2016.The
amendmentsclarifyprinciplesforthepresentationandmaterialityconsiderationsforthefinancialstatementsandnotestoimproveunderstandabilityand
comparability.Implementationofthestandardhasnothadamaterialeffectonthecondensedinterimconsolidatedfinancialstatements.
Principles of consolidation
ThecondensedinterimconsolidatedfinancialstatementsincludethecompaniesdescribedinNote1.Allintercompanyaccountsandtransactionshavebeen
eliminated.
a) TheCompanyenteredintoaseniorsecuredloanagreement(theTermLoan)(note11).
b) WiththeproceedsoftheTermLoan,theCompanyrepaiditsSubordinatedDebtandaccruedinterest(note11).
c) TheCompanyamendeditsarticlesofincorporationtopermitasharecapitalreorganizationwiththeresultthatitsclassesofpreferredshareshavebeenor
willbecancelledanditsexistingcommonsharesweresubdivided.TheamendmentsauthorizetheCompanytoissuepreferredsharesinseriesinthefuture
(note12).
d) TheproceedsoftheTermLoanwerealsousedinconnectionwiththesharecapitalreorganizationtoredeemcertainoutstandingshares,tomakecertain
returnofcapitaldistributionsonoutstandingcommonshares(note12),andtofundasecured,non-interestbearingloantoDTRLLC,acompanyindirectly
controlledbythePresidentandChiefExecutiveOfficerandshareholderoftheCompany,whichwillbeextinguishedbyitssettlementagainsttheredemption
ofpreferredsharesissuedinthesharereorganization(note14).
e) TheCompanyamendedthetermsofitsstockoptionplanandchangedthetermsofoutstandingstockoptionstoconformwiththerevisedsharecapitalterms
(note13).
F-58
Table of Contents
thetransactionasabusinesscombination.TheCompanypaid$500ontheclosingdateofthetransaction,withanamountpayableof$500dueonMay1,2017and
contingentconsiderationwithafairvalueof$500owingtotheformerownersuponsatisfactionofadditionalrequirements.Thecontingentconsiderationwillbe
remeasuredatitsfairvalueatsubsequentreportingdatesandanyresultinggainorlossincludedintheconsolidatedstatementofincomeandcomprehensive
income.TheresultsofoperationshavebeenconsolidatedwiththoseoftheCompanybeginningonApril18,2016.
Thefairvalueofthetangibleassetsacquiredisasfollows,withtheexcessofthepurchasepriceoverthefairvalueofthetangibleassetsacquiredaccountedforas
goodwill.Thegoodwillrecognizedisexpectedtobedeductibleforincometaxpurposes.TheCompanyhasnotyetfinalizeditspurchaseaccountinginrespectof
thisacquisitionpendingfinalizationofthefairvalueofthetangibleassetsacquired.
Assets acquired
$
Property,plantandequipment
1,000
1,000
Goodwill
500
F-59
Table of Contents
Operating income
54,958
41,666
(40,310)
56,314
Netinterestandotherfinancecosts
3,087
Operating income
40,029
7,876
(17,013)
30,892
Netinterestandotherfinancecosts
2,215
Operating income
100,969
41,541
(73,403)
69,107
Netinterestandotherfinancecosts
8,620
F-60
Table of Contents
Operating income
89,479
8,006
(47,119)
50,366
Netinterestandotherfinancecosts
6,017
TheCompanydoesnotreporttotalassetsortotalliabilitiesbasedonitsoperatingsegments.
OnDecember2,2016,inconnectionwiththeRecapitalization,theCompanysubdivideditsoutstandingClassAandClassBsharesonthebasisof10,000,000
sharesforeachoutstandingcommonshare(note12).Thetermsoftheoutstandingstockoptionswereadjustedtoconformtothesharestructureafterthe
Recapitalization(note13).Theeffectofthesharesubdivisionandcorrespondingadjustmenttothenumberandtermsoftheoutstandingstockoptionshasbeen
appliedretrospectivelytoprioraccountingperiodsincalculatingbasicanddilutedearningspershare.
Earningspershare
Basic 0.39 0.21 0.45 0.36
Diluted 0.38 0.21 0.44 0.35
F-61
Table of Contents
December 31 March 31
2016 2016
$ $
Tradeaccountsreceivable 84,795 18,894
Creditcardreceivables
7,484
92,279 18,894
Less:allowancefordoubtfulaccountsandsalesallowances
(3,297)
(1,419)
Tradereceivables,net
88,982
17,475
Theagingtradereceivablesisasfollows:
Past due
Total Current < 30 days 31-60 days > 60 days
$ $ $ $ $
Tradeaccountsreceivable 84,795 55,250 21,364 4,489 3,692
Creditcardreceivables 7,484 7,484
December 31, 2016 92,279 62,734 21,364 4,489 3,692
Tradeaccountsreceivable 18,894 5,507 3,757 4,254 5,376
March 31, 2016 18,894 5,507 3,757 4,254 5,376
TheCompanyhasenteredintoanagreementwithathirdpartywhohasinsuredtheriskoflossforupto90%oftradeaccountsreceivablesfromcertaindesignated
customersbasedonatotaldeductibleof$50.AsatDecember31,2016,accountsreceivabletotalingapproximately$63,732(March31,2016$16,785),were
insuredunderthisagreement.
Note 8. Inventories
December 31 March 31
2016 2016
$ $
Rawmaterials 36,373 46,648
Work-in-process 4,243 4,706
Finishedgoods
56,064
68,152
Total inventories at the lower of cost and net realizable value 96,680 119,506
IncludedininventoryasatDecember31,2016areprovisionsintheamountof$4,641(March31,2016$3,773).
F-62
Table of Contents
Amountschargedtocostofsalescomprisethefollowing:
For the three months ended For the nine months ended
December 31 December 31
2016 2015 2016 2015
$ $ $ $
Costofgoodsmanufactured 88,193 51,229 166,833 121,049
Depreciation
574
346
1,570
1,058
88,767
51,575
168,403
122,107
December 31 March 31
2016 2016
$ $
Tradepayables 20,582 23,408
Accruedliabilities 23,836 7,032
Employeebenefits 7,074 4,228
Amountsduetorelatedparties(note14) 1,910
Otherpayables
12,750
1,873
Total 64,242
38,451
Theprovisionforwarrantyclaimsrepresentsthepresentvalueofmanagementsbestestimateofthefutureoutflowofeconomicresourcesthatwillberequired
undertheCompanysobligationsforwarrantiesundersaleofgoods.Theestimatehasbeenmadeonthebasisofhistoricalwarrantytrendsandmayvaryasaresult
ofnewmaterials,alteredmanufacturingprocessesorothereventsaffectingproductqualityandproduction.
Thesalescontractprovisionrelatestomanagementsestimatedcostofthedepartureofcertainthirdpartydealers,agentsanddistributors.
F-63
Table of Contents
DirecttoConsumersaleshavealimitedrightofreturn,typicallywithin30days,whichwasextendedduringtheholidayshoppingperiodtoaccommodateahigher
volumeofactivity.ThebalanceasatDecember31,2016relatestoseasonalDirecttoConsumersalesovertheholidaysellingseason.
Sales Sales
Warranty Contracts returns Other Total
$ $ $ $ $
Balance as at March 31, 2016 6,879
4,002
798
11,679
Provisionsareclassifiedascurrentandnon-currentliabilitiesbasedonmanagementsexpectationofthetimingofsettlement,asfollows:
December 31 March 31
2016 2016
$ $
Currentprovisions 12,473 3,125
Non-currentprovisions
9,718
8,554
22,191
11,679
TheRevolvingFacilityhasmultipleinterestratechargeoptionsthatarebasedontheCanadianprimerate,BankersAcceptancerate,thelendersAlternateBase
Rate,EuropeanBaseRate,LIBORrate,orEURIBORrateplusanapplicablemargin,withinterestpayablequarterly.TheCompanyhaspledgedsubstantiallyallof
itsassetsascollateralfortheRevolvingFacility.TheRevolvingFacilitycontainsfinancialandnon-financialcovenantswhichcouldimpacttheCompanysability
todrawfunds.AsatDecember31,2016andduringtheperiodtheCompanywasincompliancewithallcovenants.
TheamountoutstandingatDecember31,2016withrespecttotheRevolvingFacilityis$59,825($57,816netofdeferredfinancingchargesof$2,009).
F-64
Table of Contents
AsatDecember31,2016,theCompanyhadlettersofcreditoutstandingundertheRevolvingFacilityof$554(March31,2016$297).
TheCompanyusedtheproceedsfromtheRevolvingFacilitytorepayandextinguishitspreviousrevolvingcreditfacilityandtermcreditfacility.Asaresultofthe
extinguishmentoftherevolvingcreditfacilityandtermcreditfacility,deferredfinancingchargesintheamountof$946wereexpensedintheninemonthsended
December31,2016asnetinterestandotherfinancecosts.
Term Loan
OnDecember2,2016,inconnectionwiththeRecapitalization,theCompanyenteredintoaseniorsecuredloanagreementwithasyndicateoflenders,theTerm
Loan,thatissecuredonasplitcollateralbasisalongsidetheRevolvingFacility,inanaggregateprincipalamountof$216,738(US$162,582).TheCompany
incurredanoriginalissuediscountof$6,502andtransactioncostsof$3,427ontheissuanceoftheTermLoan.TheTermLoanbearsinterestatarateofLIBOR
plus5%payablequarterlyorattheendofthethencurrentinterestperiod(whicheverisearlier)inarrears,providedthatLIBORmaynotbelessthan1%.The
Companyrecognizedthefairvalueoftheembeddedderivativeliabilityrelatedtotheinterestratefloorof$1,375attheinceptionoftheTermLoan.Thederivative
willberemeasuredateachreportingperiod.
TheTermLoanisdueonDecember2,2021,andisrepayableinquarterlyamountsofUS$406beginningJune30,2017.AmountsowingundertheTermLoan
mayberepaidatanytimewithoutpremiumorpenalty,butoncerepaidmaynotbereborrowed.
TheCompanyhaspledgedsubstantiallyallofitsassetsascollateralfortheTermLoan.TheTermLoancontainsfinancialandnon-financialcovenantswhichcould
impacttheCompanysabilitytodrawfunds.AsatDecember31,2016andduringtheperiodtheCompanywasincompliancewithallcovenants.
AstheTermLoanisdenominatedinUS$,theCompanyremeasurestheoutstandingbalanceplusaccruedinterestateachbalancesheetdate.Theamount
outstandingatDecember31,2016withrespecttotheTermLoanisasfollows:
$
TermLoan 218,298
Less:Unamortizedcosts
(9,810)
208,488
Less:CurrentportionofTermLoan
(1,637)
Long-termportionofTermLoan 206,851
FutureminimumprincipalrepaymentsoftheTermLoanasatDecember31,2016are:
162,582
F-65
Table of Contents
Subordinated debt
OnDecember2,2016,inconnectionwiththeRecapitalization,theCompanyrepaidtheoutstandingamountsofitssubordinateddebtplusaccruedinterestowingto
anentityrelatedtothemajorityshareholderoftheCompanyasfollows:
$
Seniorsubordinatednote 79,716
Juniorsubordinatednote 5,590
Accruedinterest
5,732
91,038
TherepaymentwasfinancedfromtheproceedsoftheTermLoan.
For the three months ended For the nine months ended
December 31 December 31
2016 2015 2016 2015
$ $ $ $
Interestexpense
Revolvingfacility 856 2,093
Termloan 1,233 1,233
Creditfacility
Revolvingcreditfacility 723 337 1,483
Termcreditfacility 73 56 228
Subordinateddebt 956 1,407 3,822 4,173
Bankindebtedness 4 2 17
Other 3 3 14 9
Standbyfees 39 5 119 111
Writeoffdeferredfinancingcostsonrefinancing
946
Interestexpenseandotherfinancingcosts 3,087 2,215 8,622 6,021
Interestincome
(2)
(4)
Net interest and other financing charges
3,087
2,215
8,620
6,017
1. The53,144,000outstandingClassAseniorpreferredshareswereredeemedfortheircapitalamountof$53,144.
F-66
Table of Contents
2. The3,426,892outstandingClassAjuniorpreferredshareswereredeemedundertheirtermsfortheirliquidityvalueof$4,063.Theexcessoftheredemption
pricepaidoverthestatedcapitalamountforthesharesof$336hasbeenchargedtoretainedearnings.
3. TheCompanyhassubdividedtheexistingClassAandClassBcommonsharesonthebasisof10,000,000commonsharesforeveryshare.
4. Areturnofcapitalof$698waspaidontheClassAcommonshares.
5. Inaseriesoftransactions,theoutstandingClassBseniorpreferredshares,theClassBjuniorpreferredsharesandtheClassBcommonshareshavebeen
exchangedinto63,576,003ClassDpreferredshareswithafixedvalueof$63,576and30,000,000ClassAcommonshares.Asaresultoftheexchange,
$56,940waschargedasareductionofcontributedsurplus,and$6,636waschargedtoretainedearnings.
6. TheClassDpreferredsharesarenon-voting,redeemablebytheCompany,retractablebytheholder,andareinpreferenceandprioritytoanypaymentor
distributionoftheassetsoftheCompanytotheholdersofanyotherclassofshares;accordingly,theredemptionvalueof$63,576isrecordedasafinancial
liability.TheClassDpreferredsharesarealsopledgedascollateralfortheshareholderadvanceof$63,576(note14);whenthesharesareredeemedor
retracted,theredemptionamountwillautomaticallybeappliedtosettletheshareholderadvance.TheobligationrelatedtotheClassDpreferredsharesand
theshareholderadvancereceivablehavebeenrecordedatthenetliabilityvalueofnilinthesecondensedinterimconsolidatedfinancialstatements.
SubsequenttotheendoftheperiodonJanuary31,2017,theClassDpreferredshareswereredeemedandtheshareholderadvancewassettledinfull.
AftertheRecapitalization,theauthorizedandissuedsharecapitaloftheCompanyisasfollows:
Authorized:
TheauthorizedsharecapitaloftheCompanyconsistsofanunlimitednumberofcommonshareswithoutparvalueandanunlimitednumberofpreferredshares
withoutparvalue,issuableinseries.
F-67
Table of Contents
Issued:
Theeffectoftherecapitalizationtransactionsontheissuedandoutstandingsharecapitalofthecompanyisdescribedbelow:
Service-vested options
Service-vestedoptions,whichareherebyreferredtoasTrancheAoptions,aresubjecttotheexecutivescontinuingemploymentandgenerallyarescheduledto
vest40%onthesecondanniversaryofthedateofgrant,20%onthethirdanniversary,20%onthefourthanniversaryand20%onthefifthanniversary.
F-68
Table of Contents
Compensationexpenseforshare-basedcompensationgrantedismeasuredatthefairvalueatthegrantdateusingtheMonteCarlovaluationmodel.
InconnectionwiththeRecapitalization,onDecember2,2016alloftheoutstandingoptionswereamendedtobecomeoptionstoacquireClassAcommonsharesof
theCompany,andthenumberandexercisepriceoftheoutstandingoptionswereadjustedtoconformwiththerevisedsharecapitalstructure(note12).
IntheninemonthperiodendedDecember31,2016theCompanygranted1,131,865optionsunderitsstockoptionplantopurchaseClassAcommonsharesat
exercisepricesrangingfrom$4.62to$8.94pershareaftergivingeffecttotheRecapitalization.Optionstopurchase222,222sharesatapriceof$1.79pershare
werecancelled.
AftertheRecapitalizationthereare6,359,785optionsoutstanding,ofwhich791,765arevested.Oftheoutstandingstockoptions,2,119,920areTrancheAoptions
thatareservicevestedoptions;theremainderareTrancheBandTrancheCoptions,performance-vestedexiteventoptionsthatvestonapro-ratabasisuponthe
occurrenceofanexitevent.
ThefollowingtablesummarizesinformationaboutstockoptionsoutstandingandexercisableatDecember31,2016,aftergivingeffecttotheRecapitalization
adjustments:
6,359,785
791,765
Oneachvestingdate,TrancheBandTrancheCoptionsbecomeeligibletovestupontheoccurrenceofanexitevent.AsatDecember31,2016thereare1,583,542
TrancheBandTrancheCoptionsthatareeligibletovestimmediatelyupontheoccurrenceofanexitevent.
F-69
Table of Contents
TheassumptionsusedtomeasurethefairvalueofoptionsgrantedduringthethreeandninemonthsendedDecember31,2016undertheMonteCarlooption
pricingmodelatthegrantdatewereasfollows:
AsatMarch31,2016accruedinterestduetothesameentityof$1,910wasincludedintheaccountspayableandaccruedliabilities.Thesubordinateddebtand
accruedinteresthasbeenrepaidinfullasatDecember31,2016.
IntheninemonthperiodendedDecember31,2016,expensespaidtoanaffiliatecontrolledbythemajorityshareholderforITservicesintheamountof$110
(December31,2015$168)wererecognized.
InconnectionwiththeRecapitalization,theCompanymadeasecured,demand,non-interestbearingshareholderadvanceof$63,576toanentityindirectly
controlledbythePresidentandChiefExecutiveOfficer,tobeextinguishedbyitssettlementagainsttheredemptionpricefortheredemptionoftheClassD
preferredshares.DTRLLCpledgedalloftheClassDpreferredsharesascollateralfortheshareholderadvance.SubsequenttotheendoftheperiodonJanuary31,
2017,theClassDpreferredshareswereredeemedandtheshareholderadvancewassettledinfull.
ManagementassessedthatthetermloanhadafairvaluethatapproximateditsamortizedcostduetotheshorttimethathaselapsedsincetheCompanyenteredinto
thearrangement(March31,2016nil).ThefairvalueofthesubordinateddebtasatMarch31,2016isbasedontheequivalentdollaramountofcommonshares
thataretobereceiveduponconversionofthesubordinateddebt,andisequaltothecarryingamountofthedebt.
F-70
Table of Contents
AsatDecember31,2016,theCompanyhadforeignexchangeforwardcontractsrepresentingnotionalamountsofUS$11,500tobuyCanadiandollarsandsellU.S.
dollars,5,000tobuyCanadiandollarsandsellEuros,4,500tobuyCanadiandollarsandsellPoundsSterling,andCHF1,000tobuySwissFrancsandsell
Canadiandollars(asatMarch31,2016notionalamountsofUS$30,500tobuyCanadiandollarsandsellU.S.dollars,4,000tobuyCanadiandollarsandsell
Euros,and1,500tobuyCanadiandollarsandsellPoundsSterling).
DuringtheninemonthsendedDecember31,2016,theCompanysettledforeignexchangeforwardcontractsandrealizedagainof$4,079(2015nil),whichhas
beenrecordedinselling,generalandadministrativeexpenses.
Fair Value
ThefollowingtablepresentsthefairvaluesandfairvaluehierarchyoftheCompanysfinancialinstrumentsandexcludesfinancialinstrumentscarriedatamortized
costthatareshort-terminnature:
F-71
Table of Contents
$
Notlaterthan1year 9,921
Laterthan1yearandnotlaterthan3years 20,596
Laterthan4yearsandnotlaterthan5years 21,178
Laterthan5years
44,612
96,307
BeginninginthethreemonthperiodendedDecember31,2016,theCompanyalsohasanobligationtopaycontingentrentbasedonapercentageofsalesin
connectionwitharetailstorelease.
F-72
Table of Contents
Prospectus
CIBC Capital Markets Credit Suisse Goldman, Sachs & Co. RBC Capital Markets
BofA Merrill Lynch Morgan Stanley Barclays BMO Capital Markets TD Wells Fargo Securities
Through and including April 9, 2017 (25 days after the commencement of this offering), all dealers that effect transactions in our subordinate voting
shares, whether or not participating in this offering, may be required to deliver a prospectus. This delivery is in addition to a dealers obligation to deliver
a prospectus when acting as an underwriter and with respect to their unsold allotments or subscriptions.