Canopy Growth Announces Plan to Acquire Wana Brands

Smiths Falls, Ontario, Canada & Boulder, Colorado, USA [Thursday, October 14, 2021] – PRESS RELEASE – Canopy Growth Corporation and Mountain High Products, LLC, Wana Wellness, LLC and The Cima Group, LLC (collectively, “Wana” and each, a “Wana Entity”) have announced that they have entered into definitive agreements providing Canopy Growth with the right, upon federal permissibility of THC in the U.S., to acquire 100% of the outstanding membership interests of Wana, the No. 1 edibles brand in North America by market share.

Wana manufactures and sells gummies in the U.S. state of Colorado and licenses its intellectual property to partners, who manufacture, distribute, and sell Wana-branded gummies across the U.S., including California, Arizona, Illinois, Michigan, and Florida, giving Wana a total footprint of 12 U.S. states currently, and across Canada. Wana expects to have license agreements in place in more than 20 U.S. states, including in future adult-use markets in New York and New Jersey, prior to the end of calendar 2022.

Strategic Benefits

Strengthens Canopy Growth’s U.S. Ecosystem: Wana’s leadership position and ongoing expansion across the U.S. bolsters Canopy Growth’s product, brand, and geographic exposure to the U.S. market upon federal permissibility.Dominant Edibles Category: The gummies category is one of the fastest growing segments in both the U.S. and Canadian markets accounting for more than 71% of all edibles purchased. Based on Canopy Growth’s consumer research, edibles are expected to continue to serve as the primary point of entry for new consumers into the THC category and as such having a leadership position in the gummy category is critical.Market Leadership in the Edibles Product Category: Wana is the leading cannabis edibles brand in North America based on market share, with the largest multi-market presence of any independent edibles brand across the U.S. gummy market, and No.1 share of the Canadian gummy market, respectively.Increases Exposure to U.S. Cannabis Market Upon Federal Permissibility: Upon exercising its right to acquire Wana, Canopy Growth will own and operate Wana’s vertically integrated facility in Colorado as well as its rapidly growing licensing division, which currently covers 11 states and is expected to cover more than 20 states by the end of calendar year 2022. This expands upon the coverage provided by the company’s existing right to acquire Acreage Holdings, Inc., a U.S. multi-state operator, and the company’s conditional ownership interest in TerrAscend Corp., another U.S. multi-state operator.  Profitable and Highly Scalable Business Model: Wana has a profitable business with a track record of generating strong revenue growth and category-leading gross and EBITDA margins. Wana’s proven licensing model provides an opportunity to scale the brand ahead of U.S. federal permissibility. Further Strengthens Canopy Growth’s Leading House of Brands: Wana is the No. 1 cannabis edibles brand in North America and will complement Canopy Growth’s diversified product portfolio across the recreational cannabis industry.

“As we establish Canopy Growth as the world’s leading cannabis company, acquiring the No. 1 cannabis edibles brand in North America will serve to strengthen our market position in both Canada and

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