CANOPY GROWTH AND INDIVA ANNOUNCE AGREEMENT TO POSITION WANA GUMMIES FOR CONTINUED NORTH AMERICAN BRAND LEADERSHIP

Canopy Growth to control all distribution, marketing, and sales of industry leading Wana branded products in Canada, further uniting the Company's North American house of brands

Indiva to manufacture Wana for Canopy in Canada under exclusivity ensuring continuity of
quality product supply

Canopy to acquire 19.99% interest in Indiva as part of the transactions

SMITHS FALLS, ON and LONDON, ON, May 30, 2023 /PRNewswire/ - Canopy Growth Corporation ("Canopy Growth" or the "Company") (TSX: WEED) (NASDAQ: CGC), a leading global cannabis company, and Indiva Limited ("Indiva") (TSXV:NDVA), the leading Canadian producer of cannabis edibles and other cannabis products, and its subsidiary, Indiva Inc., announced today that they have entered into a license assignment and assumption agreement (the "Assignment Agreement") providing Canopy Growth exclusive rights and interests to manufacture, distribute, and sell Wana™ branded products in Canada which accelerates Canopy Growth's ability to leverage the Wana brand.

Simultaneously, to support continuity of quality supply and aligned to Canopy Growth's asset light strategy for sourcing of cannabis 2.0 formats, Canopy Growth and Indiva also entered into a contract manufacturing agreement (the "Manufacturing Agreement"), under which Canopy Growth will grant Indiva the exclusive right to manufacture and supply Wana™ branded products in Canada for a period of five years, with the ability to renew for an additional five-year term upon mutual agreement of the parties.

David Klein, CEO of Canopy Growth, said, "Collectively, these agreements provide Canopy Growth more complete ownership over the value chain for the Wana brand in Canada, while ensuring continuity of high-quality manufacturing and consistency with Canopy's asset-light production strategy. By better aligning our ownership position in Wana throughout North America, we expect to accelerate the introduction of product innovation in Canada that has already proven enormously popular in the United States. We expect this arrangement to be immediately accretive to Canopy Growth's EBITDA, and we look forward to partnering with Indiva to further bolster Wana's position as a leading edible brand in Canada."

"We are excited to form this investment and contract manufacturing partnership with Canopy Growth, and we look forward to continuing to produce Wana gummies for many years to come," said Niel Marotta, President and CEO of Indiva. "The benefits of this partnership to Indiva's shareholders are three-fold: First, the strategic investment bolsters Indiva's balance sheet. Second, the initial five-year term of the contract manufacturing agreement, and the potential to renew for an additional five-year term, extends the timeline and economic benefit to Indiva from sales of Wana gummies well beyond the remaining term of the existing licensing agreement. Lastly, Indiva's commitment to production innovation has made us Canada's leading producer of high-quality cannabis edibles, and we look forward to leveraging our recent investments in automation for the processing and packaging of edible products." 

"This is a great step forward in solidifying both Wana's brand leadership, as well as integrating Wana with Canopy Growth's strong presence in Canada," said Nancy Whiteman, CEO of Wana Brands. "This new agreement allows us to bring our most innovative products to Canada much more rapidly, while allowing Canopy Growth to begin recognizing the EBITDA benefits that Wana can help drive. We already know the team at Canopy Growth well, which should make for a smooth transition, and it will be great to have the oversight of the Canopy Growth team on the Wana brand in Canada. We thank Indiva for all they have done to make Wana the top edible in Canada over the past three years¹ and we are pleased that we will have the opportunity to continue to work with their great team in a production capacity."

As consideration for Indiva entering into the Assignment Agreement and other related agreements in respect of the transactions described herein, Indiva will complete a non-brokered private placement offering of common shares ("Common Shares") of Indiva whereby Canopy Growth will subscribe for 37,230,000 Common Shares for an aggregate purchase price of $2,155,617 (the "Private Placement") at a price per Common Share of $0.0579 (the "Issue Price"). The Issue Price was determined based on the 10-day volume weighted average trading price of the Common Shares on the TSX Venture Exchange (the "TSXV") during the 10 consecutive trading days ending on the last trading day immediately prior to the date hereof. Upon closing of the Private Placement, Canopy will exercise control and direction over 19.99% of the issued and outstanding Common Shares. The balance of the consideration will be paid by Canopy to Indiva as follows: (i) additional consideration representing a value of $844,383; (ii) a cash payment of $1,250,000 on May 30, 2024.

Indiva intends to use the net proceeds of the Private Placement to satisfy its existing obligations under its license to manufacture and sell Wana™ branded products in Canada and for its costs and expenses related to the manufacture and supply Wana™ branded products under the Manufacturing Agreement.

Following the closing of the Private Placement, Canopy Growth will have the ability to nominate an individual as a Board observer on the Board of Directors of Indiva. Canopy Growth and Indiva will also enter into a customary standstill and voting support agreement.

The Private Placement is expected to close on or before June 6, 2023 (the "Closing Date") and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the TSXV. The Common Shares to be issued under the Private Placement will have a hold period of four months and one day from the Closing Date. The Private Placement is integral to the Assignment Agreement and other related agreements in respect of the transactions described herein, and therefore Indiva expects to rely on the "part and parcel" pricing exception available under section 1.7 of TSXV Policy 4.1 – Private Placements.

Immediately prior to the Private Placement, Canopy Growth and its affiliates held no Common Shares. Upon the closing of the Private Placement it is anticipated that Canopy Growth and its affiliates will exercise control and direction over 19.99% of the issued and outstanding Common Shares. Canopy Growth and its affiliates do not currently own any convertible securities of Indiva. The Common Shares are being acquired for investment purposes and, as of the date of this news release, Canopy Growth and its affiliates have no current intention to acquire control or direction over additional securities of Indiva above 19.99% of the issued and outstanding Common Shares, either alone or together with any joint actors.

The securities to be offered pursuant to the Private Placement have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act") or any U.S. state securities laws, and may not be offered or sold in the United States or to, or for the account or benefit of, United States persons absent registration or any applicable exemption from the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws. This news release shall not constitute an offer to sell or the solicitation of an offer to buy securities in the United States, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

Canopy Growth is a leading North American cannabis and CPG company dedicated to unleashing the power of cannabis to improve lives. Through an unwavering commitment to our consumers, Canopy Growth delivers innovative products with a focus on premium and mainstream cannabis brands including Doja, 7ACRES, Tweed, and Deep Space. Our CPG portfolio features sugar-free sports hydration brand BioSteel, targeted 24-hour skincare and wellness solutions from This Works, gourmet wellness products by Martha Stewart CBD, and category defining vaporizer technology made in Germany by Storz & Bickel. Canopy Growth has also established a comprehensive ecosystem to realize the opportunities presented by the U.S. THC market through its rights to Acreage Holdings, Inc. a vertically integrated multi-state cannabis operator with principal operations in densely populated states across the Northeast, as well as Wana Brands, a leading cannabis edible brand in North America, and Jetty Extracts, a California-based producer of high-quality cannabis extracts and pioneer of clean vape technology. Beyond our world-class products, Canopy Growth is leading the industry forward through a commitment to social equity, responsible use, and community reinvestment—pioneering a future where cannabis is understood and welcomed for its potential to help achieve greater well-being and life enhancement. For more information visit www.canopygrowth.com.

Indiva is proud to be Canada's #1 producer of cannabis edibles. We set the gold standard for quality and innovation with our award-winning products, across a wide range of brands including Wana, Bhang, Pearls by Grön, as well as Indiva branded edibles and extracts. Indiva manufactures its top-quality products in its state-of-the-art facility in London, Ontario, and has a corporate workforce remotely distributed across Southern Ontario. Click here to connect with Indiva on LinkedIn, Instagram, Twitter and Facebook, and here to find more information on Indiva and its products.

Certain statements contained in this news release constitute forward-looking information. These statements relate to future events or future performance. The use of any of the words "could", "intend", "expect", "believe", "will", "projected", "estimated" and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the parties' current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. In particular, this news release contains forward-looking information relating to, among other things, each of the Company's and Indiva's future operations, the Private Placement and the terms thereof and anticipated closing date, future results, future product offerings (including the timing of the introduction of new product offerings) and compliance with applicable regulations. Various assumptions or factors are typically applied in drawing conclusions or making the forecasts or projections set out in forward-looking information. Those assumptions and factors are based on information currently available to the parties. The material factors and assumptions include the parties being able to maintain the necessary regulatory and other third parties' approvals and licensing and other risks associated with regulated entities in the cannabis industry, the transactions described in this news release and the parties ability to complete the transactions on the terms described herein or at all, future sales, the demand for each of the Company's and Indiva's products and cannabis products generally and the continued operations of each of the Company and Indiva in the ordinary course. The forward-looking information contained in this news release is made as of the date hereof and neither the Company nor Indiva is obligated to, and does not undertake to, update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Because of the risks, uncertainties and assumptions inherent in forward-looking information, investors should not place undue reliance on forward looking information. The foregoing statements expressly qualify any forward-looking information contained herein.

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) has in any way passed upon the merits of the contents of this news release and neither of the foregoing entities accepts responsibility for the adequacy or accuracy of this news release or has in any way approved or disapproved of the contents of this news release.

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SOURCE Canopy Growth Corporation