BZAM LTD. — Annual Report 2021

Apr 19, 2022

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THE GREEN ORGANIC DUTCHMAN HOLDINGS LTD.

ANNUAL INFORMATION FORM

For the Financial Year Ended December 31, 2021

Dated April 18, 2022

TABLE OF CONTENTS

Page

ANNUAL INFORMATION FORM ............................................................................................. 1 FORWARD-LOOKING INFORMATION ....................................................................... 1 GLOSSARY OF TERMS .............................................................................................................. 6 CORPORATE STRUCTURE ..................................................................................................... 12 NAME, ADDRESS, AND INCORPORATION ............................................................. 12 GENERAL DEVELOPMENT OF THE BUSINESS.................................................................. 14 THREE-YEAR HISTORY .............................................................................................. 14 DESCRIPTION OF BUSINESS.................................................................................................. 25 GENERAL ....................................................................................................................... 25 CANNABIS PRODUCTS AND PRODUCTION ........................................................... 26 CORE BRANDS AND PRODUCTS .............................................................................. 28 INTELLECTUAL PROPERTY ...................................................................................... 29 PRODUCTION FACILITIES AND LICENCES ............................................................ 29 COMPETITIVE CONDITIONS ..................................................................................... 30 CANNABIS REGULATORY FRAMEWORK IN CANADA ....................................... 31 REGULATORY FRAMEWORK OUTSIDE OF CANADA ......................................... 39 RISK FACTORS ............................................................................................................. 46 DIVIDENDS AND DISTRIBUTIONS ....................................................................................... 75 DESCRIPTION OF CAPITAL STRUCTURE ........................................................................... 75 MARKET FOR SECURITIES .................................................................................................... 78 PRIOR SALES............................................................................................................................. 81 SUBSEQUENT SALES .............................................................................................................. 83 ESCROWED SECURITIES ........................................................................................................ 84 ESCROW AND INDEMNITY ESCROW AGREEMENTS .......................................... 84 SECURITIES SUBJECT TO CONTRACTUAL RESALE RESTRICTIONS .............. 84 DIRECTORS AND OFFICERS .................................................................................................. 85 NAME, OCCUPATION AND SECURITY HOLDING................................................. 85 CEASE TRADE ORDERS, BANKRUPTCIES, PENALTIES OR SANCTIONS ........ 87 CONFLICTS OF INTEREST .......................................................................................... 88 PROMOTERS.............................................................................................................................. 88

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LEGAL PROCEEDINGS ............................................................................................................ 89 INTERESTS OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS ........ 89 TRANSFER AGENT AND REGISTRARS ............................................................................... 90 MATERIAL CONTRACTS ........................................................................................................ 90 INTEREST OF EXPERTS .......................................................................................................... 91 NAME OF EXPERTS ..................................................................................................... 91 INTERESTS OF EXPERTS ............................................................................................ 91 AUDIT COMMITTEE ................................................................................................................ 91 COMPOSITION OF THE AUDIT COMMITTEE ......................................................... 91 AUDIT COMMITTEE CHARTER ................................................................................. 92 AUDIT COMMITTEE OVERSIGHT ............................................................................. 92 PRE-APPROVAL POLICIES AND PROCEDURES .................................................... 93 EXTERNAL AUDITOR SERVICE FEES (BY CATEGORY) ..................................... 93 ADDITIONAL INFORMATION ................................................................................................ 93 SCHEDULE A ........................................................................................................................... A-1

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ANNUAL INFORMATION FORM

In this annual information form (the “ Annual Information Form ”), unless otherwise noted or the context indicates otherwise, the “Company”, “we”, “us” and “our” refer to The Green Organic Dutchman Holdings Ltd. and its subsidiaries.

All financial information in this Annual Information Form is stated in Canadian dollars, unless otherwise indicated, and prepared using International Financial Reporting Standards as issued by the International Accounting Standards Board. The information contained herein is dated as of December 31, 2021, with subsequent events disclosed to April 18, 2022.

Forward-Looking Information

This Annual Information Form contains certain statements which may constitute “forward-looking information” and “forward-looking statements” within the meaning of Canadian securities law requirements (collectively, “ forward-looking statements ”). These forward-looking statements are made as of the date of this Annual Information Form and the Company does not intend, and does not assume any obligation, to update these forward-looking statements, except as required under applicable securities law. Forward-looking statements relate to future events or future performance and reflect Company management’s expectations or beliefs regarding future events.

In some cases, these forward-looking statements can be identified by the use of words or phrases such as “plans”, “expects” or “does not expect”, “is expected”, “projects”, “proposes”, “potential”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “should”, “would”, “might” or “will be taken”, “occur” or “be achieved” or the negative of these terms or comparable terminology. By their very nature forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. The Company provides no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Certain forward-looking statements in this Annual Information Form include, but are not limited to, statements regarding:

• the Company’s ability to continue as a going concern and successfully execute its plans and intentions, including but not limited to the generation of revenues, positive operating cash flows from the sale of its products;

• the continued compliance of current financing arrangements and availability of additional financing at reasonable terms;

• finding a suitable buyer for its HemPoland Operations (as defined below) and on reasonable terms;

• the implications of the Galaxie Transaction (as defined below) to the Company’s business;

• the ability of the Company to enter into the U.S. market;

• continuing to obtain necessary regulatory approvals or renewals;

• future revenue, expenses and research and development operations;

• production and expansion plans at our facilities and the capacity thereof;

• the Company’s expected business objectives for the next twelve months;

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• general business and economic conditions, particularly in the Canadian medicinal and adult-use cannabis markets;

• regulation of the markets in which the Company operates;

• the outcome of research and development on cannabis;

• expectations regarding production capacity, costs and yields;

• expansion plans internationally;

• the Company’s Mexican joint venture partner obtaining all necessary permits and authorizations;

• the Mexican government issuing formal regulations for medicinal cannabis;

• treatment under government regulatory and taxation regimes;

• the Company’s continued ability to participate in the adult-use market in Canada;

• the legalization of cannabis for adult-use and/or medical use in jurisdictions outside of Canada and the Company’s ability to participate in any such markets, if and when such use is legalized;

• the effect of government regulations (or changes thereto) with respect to the restrictions on production, sale (including the roll-out of authorized retailers in provinces such as Ontario and recent amendments to the regulation of distribution of cannabis in Ontario), consumption, export controls, income taxes, expropriation of property, repatriation of profits, environmental legislation, land use, water use and receipt of necessary permits;

• the future growth of the Company’s medical cannabis products;

• the medical benefits, safety, efficacy, dosing and social acceptance of cannabis;

• future product offerings;

• the Company’s ability to attract and retain skilled staff;

• the Company’s investments in community relations, cannabis health and safety and educational programming in the locations where the Company operates and the further development of its social responsibility programs;

• the Company’s competitive position and the regulatory environment in which the Company operates;

• market competition, including the products and technology offered by the Company’s competitors;

• maintenance of our current good relationships with our suppliers, service providers and other third parties; and

• ability to continue to operate during the implementation of COVID-19 restrictions and maintaining necessary access and safety protocols.

Forward-looking statements are based on certain assumptions and analyses made by the Company in light of the experience and perception of historical trends, current conditions and expected future developments and other factors it believes are appropriate and are subject to risks and uncertainties. In making the forward-looking statements included in this Annual Information Form, the Company has made various material assumptions, including but not limited to assumptions related to: (i) the availability of financing at all or on reasonable terms; (ii) the Company’s ability to continue as a going concern and successfully execute its plans and intentions, including with respect to the operations of the Company’s cultivation facilities; (iii) general business and economic conditions, particularly in the Canadian medicinal and adult-use cannabis markets; (iv) regulation of the markets in which we operate; (v) the Company’s ability to attract and retain skilled staff; (vi) market competition, including the products and technology offered by the Company’s competitors; (vii) maintenance of our current good relationships with our suppliers, service providers and other third parties; (viii) obtaining any necessary regulatory approvals in respect of its business and operations; (ix) ability of the Company to enter the United States and other international markets; and (x) ability to continue to operate during the implementation of COVID-19

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restrictions and maintaining necessary access and safety protocols. Although we believe that the assumptions underlying these statements are reasonable, they may prove to be incorrect, and we cannot assure that actual results will be consistent with these forward-looking statements . Whether actual results, performance or achievements will conform to the Company’s expectations and predictions is subject to a number of known and unknown risks, uncertainties, assumptions and other factors, including those listed under “ Risk Factors ”, which include:

• the ongoing impact of COVID-19;

• the Company’s ability to continue as a going concern;

• the Company’s ability to raise required additional capital through the sale of equity or debt instruments or sale of assets or the factoring of receivables or otherwise;

• the Company has a limited operating history;

• the Company may be unable to achieve revenue growth and development;

• there are factors which may prevent the Company from the realization of growth targets;

• the Company’s actual financial position and results of operations may differ materially from the expectations of the Company’s management;

• the Company may incur significant ongoing costs and obligations related to its investment in infrastructure, growth, research and development, regulatory compliance and operations;

• there is no assurance that the Company will turn a profit;

• the Company’s management has broad discretion concerning the use of net proceeds of the ATM program;

• the Company is subject to risks typically associated with secured debt financing;

• the Company may incur additional indebtedness;

• the adult-use cannabis market in Canada is a relatively new industry;

• the adult-use cannabis market in Canada may experience supply and demand fluctuations that could result in revenue and price decreases;

• the Company’s business is dependent on key supply chains which could be adversely disrupted by a number of factors including, among others, major health issues or pandemics;

• the Company is reliant on regulatory approvals and cultivation licences for its ability to grow, process, package, store and sell cannabis and other products derived therefrom, and these regulatory approvals are subject to ongoing compliance requirements, reporting obligations and fixed terms requiring renewal;

• any failure on the Company’s part to comply with applicable regulations could prevent it from being able to carry on its business and there may be additional costs associated with any such failure;

• under Canadian regulations, a Licensed Producer of cannabis is restricted regarding the type and form of marketing it can undertake which could materially impact sales performance;

• the Company’s industry is experiencing rapid growth and consolidation that may cause the Company to lose key relationships and intensify competition;

• the Company may be unsuccessful in competing in the overall legal adult-use cannabis market in Canada and any other countries it intends to operate in;

• if the Company is unable to attract and retain key personnel, it may not be able to compete effectively in the cannabis market;

• the Company, or the cannabis industry more generally, may receive unfavorable publicity or become subject to negative consumer or investor perception;

• the Company’s products may not have, or may not be perceived to have, the effects intended by the end user;

• if the Company is unable to develop and market new products, it may not be able to keep pace with market developments;

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• there has been limited study on the health effects of cannabis products, including CBD, and future clinical research studies may lead to conclusions that dispute or conflict with the Company’s understanding and belief regarding the medical benefits, viability, safety, efficacy, dosing and social acceptance of such products;

• consumer preferences may change and the Company may be unsuccessful in retaining customers;

• trade of cannabis for non-medicinal purposes within Canada may be restricted by the Canadian Free Trade Agreement;

• the Company must rely on international advisors and consultants in the foreign countries in which it operates and intends to operate;

• the Company is required to comply concurrently with federal, state or provincial, and local laws in each jurisdiction where it operates or to which it exports its products;

• the CBD industry and market is new and heavily regulated with rules subject to rapidly changing laws and uncertainty, compliance with which may come with significant cost;

• the CBD products industry and market in the EU and Mexico are also subject to many of the same risks as the adult-use cannabis industry and market;

• the Company has entered into and in the future may seek to enter into strategic alliances including contractual relationships, joint ventures, selective acquisitions, licensing arrangements or other relationships, or expand the scope of currently existing relationships, with third parties that the Company believes will have a beneficial impact, and there are risks that such strategic alliances or expansions of the Company’s currently existing relationships may not continue or enhance its business in the desired manner;

• the Company may not be able to successfully identify and execute future acquisitions or dispositions or successfully manage the impacts of such transactions on its operations;

• the Company may be subject to acquisition and integration risk related to the Galaxie Transaction;

• the Company may be subject to risks associated with the permits and approvals on real property acquired in the Galaxie Transaction;

• the cultivation of cannabis includes risks inherent in an agricultural business including the risk of crop loss, sudden changes in environmental conditions, equipment failure, product recalls and others;

• the Company is reliant on key inputs, such as water and utilities, and any interruption of these services could have a material adverse effect on the Company’s finances and operation results. The Company is also dependent on access to skilled labour, equipment and parts;

• the Company is vulnerable to rising energy and transportation costs;

• the Company’s quality control systems may not operate effectively;

• the Company’s cannabis products may be subject to recalls for a variety of reasons, which could require it to expend significant management and capital resources;

• the Company faces an inherent risk of exposure to product liability;

• the Company’s operations are subject to safety, health and environmental laws and regulations applicable to its operations and industry in the various jurisdictions in which it operates, and it may be held liable for any breaches of those laws and regulations;

• the Company could be liable for fraudulent or illegal activity by its employees, contractors and consultants resulting in significant financial losses or claims against the Company;

• the Company may become subject to litigation in the ordinary course of business;

• the Company will be reliant on information technology systems and may be subject to damaging cyber-attacks;

• the Company may be exposed to liability or the threat of liability in relation to the use of customer information and other personal and confidential information;

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• the Company may be subject to risks related to the protection and enforcement of its intellectual property rights, or intellectual property it licenses from others, and may become subject to allegations that it or its licensors are in violation of intellectual property rights of third parties;

• the Company may be subject to breaches of security at its facilities;

• management may not be able to successfully implement adequate internal controls over financial reporting;

• if the Company has a material weakness in its internal controls over financial reporting, investors could lose confidence in the reliability of the Company’s financial statements, which could result in a decrease in the value of its securities;

• the Company has negative operating cash flow;

• the Company has made certain assumptions related to cash flows and future sales of the Company’s product lines;

• the Company may be subject to credit risk;

• tax and accounting requirements may change in ways that are unforeseen to the Company and it may face difficulty or be unable to implement or comply with any such changes;

• the Company may not be able to renew or secure adequate insurance to protects its assets, operations and employees;

• fluctuations in foreign currency exchange rates could harm the Company’s results of operations;

• U.S. border officials could deny entry into the U.S. to non-U.S. citizens who are employees of or investors in companies with cannabis operations in the United States and Canada;

• the Company is subject to risks associated with the potential expansion in the United States;

• the potential sale of the Company’s HemPoland operations;

• the price of the Common Shares in public markets may experience significant fluctuations;

• if securities or industry analysts do not continue to publish research, or publish inaccurate or unfavourable research, about the Company’s business, the Common Share price and trading volume could decline;

• the Company continues to sell shares for cash to fund operations, expansion, and mergers and acquisitions that will dilute the current shareholders;

• it is not anticipated that any dividends will be paid to holders of Common Shares for the foreseeable future; and

• the Company is subject to ongoing reporting requirements under applicable securities laws and exchange policies.

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GLOSSARY OF TERMS

The following is a glossary of certain terms used in this Annual Information Form.

“ ACMPR ” means the former Access to Cannabis for Medical Purposes Regulations promulgated under the Controlled Drugs and Substances Act (Canada).

“ Acosta ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – New Products and Distribution in 2021 ”.

“ Administrator ” has the meaning ascribed thereto under the heading “ Directors and Officers – Cease Trade Orders, Bankruptcies, Penalties or Sanctions ”.

“ AGCO” means the Alcohol and Gaming Commission of Ontario.

“ Amended and Restated Credit Agreement ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Financings”.

“ Amending Regulations ” has the meaning ascribed thereto under the heading “ Description of Business – Cannabis Regulatory Framework in Canada ”.

“ Annual Information Form ” means this annual information form of the Company dated April 18, 2022, for the year ended December 31, 2021.

“ ARTG ” has the meaning ascribed thereto under the heading “ Description of Business – Regulatory Framework Outside of Canada – Australia ”.

“ ATM ” has the meaning ascribed thereto under the heading “ General Development of the Business – ThreeYear History – Financings”.

“ Authorized Distributor ” has the meaning ascribed thereto under the heading “Intercorporate Relationships – The Green Organic Dutchman Ltd.”.

“ Authorized Retailer ” has the meaning ascribed thereto under the heading “ Intercorporate Relationships – The Green Organic Dutchman Ltd. ”.

“ Base Shelf Prospectus ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Financings”.

“ Bill ” has the meaning ascribed thereto under the heading “ Description of Business – Regulatory Framework Outside of Canada – Mexico ”.

“ Board ” means the board of directors of the Company.

“ Canaccord ” means Canaccord Genuity Corp.

“ Cannabis Act ” means the Cannabis Act (Canada) and the regulations promulgated thereunder.

“ Cannabis Regulations ” means the Cannabis Regulations promulgated under the Cannabis Act.

“ Cannabis Tracking and Licensing System ” has the meaning ascribed thereto under the heading

“ Description of Business – Cannabis Regulatory Framework in Canada ”.

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“ Cannara ” means Cannara Biotech (Valleyfield) Inc.

“ Cannara Service Agreement ” has the meaning ascribed thereto under the heading “ Corporate Structure

– Intercorporate Relationships – Medican Organic Inc. ”.

“ CBCA ” means the Canada Business Corporations Act .

“ CBD ” means cannabidiol, a non-euphoric chemical compound found in cannabis.

“ CCAA ” means the Companies’ Creditors Arrangement Act (Canada).

“ CDSA ” means the Controlled Drugs and Substances Act (Canada).

“ Common Shares ” means common shares in the capital of the Company.

“ Company ” means The Green Organic Dutchman Holdings Ltd., a corporation incorporated under and governed by the laws of Canada.

“ Computershare ” means Computershare Trust Company of Canada.

“ COVID-19 ” has the meaning ascribed thereto under the heading “ Description of Business - General ”.

“CPG ” has the meaning ascribed thereto under the heading “ Description of Business - Cannabis Products and Production ”.

“ Credit Facility ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Financings”.

“ CSE ” means the Canadian Securities Exchange.

• “ CSE Listing ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – CSE Listing”.

“ Customs Regulations ” has the meaning ascribed thereto under the heading “ Description of Business – Regulatory Framework Outside of Canada – Australia ”.

“ December 2019 Warrants ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Financings”.

“ December 2020 Warrants ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Financings”.

“Directors ” means the current directors of the Company collectively, and in the singular means any one of them.

“ Escrow Agent ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Galaxie Brands Corporation Acquisition ”.

“ Escrow Agreement ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Galaxie Brands Corporation Acquisition ”.

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“ Escrow Shares ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Galaxie Brands Corporation Acquisition ”.

“ EU-GMP ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – EU-GMP Certification Update”.

“ FDA ” means the Food and Drugs Act (Canada).

“ First Credit Amendment ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Financings”.

“ First Loan Amendment ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Financings”.

“ Galaxie ” has the meaning ascribed thereto under the heading “ Corporate Structure – Intercorporate Relationships – Galaxie Brands Corporation ”.

“ Galaxie Agreement ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Galaxie Brands Corporation Acquisition ”.

“ Galaxie Licence ” has the meaning ascribed thereto under the heading “ Corporate Structure – Intercorporate Relationships – Galaxie Brands Corporation ”.

“ Galaxie Options ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Galaxie Brands Corporation Acquisition ”.

“ Galaxie Transaction ” has the meaning ascribed thereto under the heading “ Corporate Structure – Intercorporate Relationships – Galaxie Brands Corporation ”.

“ GRAS ” has the meaning ascribed thereto under the heading “ Description of Business – Regulatory Framework Outside of Canada – United States ”.

“ Hamilton Facility ” has the meaning ascribed thereto under the heading “ Corporate Structure – Intercorporate Relationships – The Green Organic Dutchman Ltd.”.

“ HemPoland ” means HemPoland sp. z.o.o.

“ HemPoland Acquisition ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – HemPoland ”.

“ HemPoland Disposition ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – HemPoland ”.

“ IHR ” means the new Industrial Hemp Regulations promulgated under the Cannabis Act.

“ Indemnity Escrow Agreement ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Galaxie Brands Corporation Acquisition ”.

“ Indemnity Escrow Shares ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Galaxie Brands Corporation Acquisition ”.

“ IT ” has the meaning ascribed thereto under the heading “ Description of Business – Risk Factors ”.

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“ June 2020 Warrants ” means the Common Share purchase warrants issued on June 26, 2018 in connection with the bought deal private placement of the Company. Each whole June 2020 Warrant entitled the holder to purchase one Common Share at an exercise price of $9.50 per Common Share until June 26, 2021.

“ Licence ” has the meaning ascribed thereto under the heading “ Corporate Structure – Intercorporate Relationships – The Green Organic Dutchman Ltd.” .

“ Licensed Producer ” has the meaning ascribed thereto under the heading “ Corporate Structure – Intercorporate Relationships – The Green Organic Dutchman Ltd. ” and is a Licensee under the Cannabis Act.

“ Licensee ” has the meaning ascribed thereto under the heading “ Corporate Structure – Intercorporate Relationships – The Green Organic Dutchman Ltd. ”.

“ Licensing Agreement ” has the meaning ascribed thereto under the heading “General Development of the Business – Three-Year History - Exclusive Licence for Stillwater Foods’ RIPPLE SC ”.

“ Medican Organic ” means Medican Organic Inc., a wholly-owned subsidiary of the Company.

“ Medican Licence ” has the meaning ascribed thereto under the heading “ Corporate Structure – Intercorporate Relationships – Medican Organic Inc.” .

“ Mexico Regulation ” has the meaning ascribed thereto under the heading “ Description of Business – Regulatory Framework Outside of Canada – Mexico ”.

“ Milestone Shares ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Galaxie Brands Corporation Acquisition ”.

“ Minister ” means the Minister of Health (Canada).

“ Narcotic Act ” has the meaning ascribed thereto under the heading “ Description of Business – Regulatory Framework Outside of Canada – Australia ”.

“ NBLC ” means the New Brunswick Liquor Corporation.

“ New Classes of Cannabis ” has the meaning ascribed thereto under the heading “ Description of Business – Cannabis Regulatory Framework in Canada ”.

“ NHPs ” has the meaning ascribed thereto under the heading “ Description of Business – Cannabis Regulatory Framework in Canada ”.

“ NHPR ” has the meaning ascribed thereto under the heading “ Description of Business – Cannabis Regulatory Framework in Canada ”.

“ NI 52-110 ” means National Instrument 52-110 Audit Committees .

“ NLC ” means the Newfoundland and Labrador Liquor Corp.

“ NSLC ” Nova Scotia Liquor Corporation.

“ OBCA ” means the Business Corporation Act (Ontario).

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“ OCRC ” means the Ontario Cannabis Retail Corporation.

“ OCS ” means the Ontario Cannabis Store.

“ October 2020 Warrants ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Financings”.

“ Options ” means options to purchase Common Shares.

“ Option Shares ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Galaxie Brands Corporation Acquisition ”.

“ OTCQX ” means the OTCQX Best Market operated by OTC Market Group.

“ Pro-Cert ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Pro-cert Organic Certifications”.

“ Purchase Price ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Galaxie Brands Corporation Acquisition ”.

“ Purchased Shares ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Galaxie Brands Corporation Acquisition ”.

“ Puslinch Facility ” has the meaning ascribed thereto under the heading “ Corporate Structure – Intercorporate Relationships – Galaxie Brands Corporation ”.

“ QBCA ” means the Business Corporation Act (Quebéc).

“ Québec Disposition ” has the meaning ascribed thereto under the heading “ Corporate Structure – Intercorporate Relationships – Medican Organic Inc. ”.

“ Québec Facility ” has the meaning ascribed thereto under the heading “ Corporate Structure – Intercorporate Relationships – Medican Organic Inc. ”.

“ Registered Patients ” has the meaning ascribed thereto under the heading “ Description of Business - Cannabis Products and Production ”.

“ Regulations ” means all regulations promulgated under the Cannabis Act.

“ Research Licence ” has the meaning ascribed thereto under the heading “ Corporate Structure – Intercorporate Relationships – The Green Organic Dutchman Ltd. ”.

“ Revolver Loan ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Financings”.

“ RFP ” means a request for proposal.

“ RSU Plan ” has the meaning ascribed thereto under the heading “ Description of Capital Structure – Restricted Share Units and Convertible Units ”.

“ SAHPRA ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Other Strategic Initiatives ”.

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“ SAS ” has the meaning ascribed thereto under the heading “ Description of Business – Regulatory Framework Outside of Canada – Australia ”.

“ Second Credit Amendment ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Financings”.

“ Shoppers ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Medical Cannabis by Shoppers Supply Agreement”.

“ SKU ” means a stock-keeping unit, an alphanumeric code assigned to inventory products.

“ SLGA ” means the Saskatchewan Liquor and Gaming Authority.

“ South Africa Medicines Act ” has the meaning ascribed thereto under the heading “ Description of Business – Regulatory Framework Outside of Canada – South Africa ”.

“ Stillwater ” means Stillwater Brands, Inc.

“ TG Act ” has the meaning ascribed thereto under the heading “ Description of Business – Regulatory Framework Outside of Canada – Australia ”.

“ TGA ” has the meaning ascribed thereto under the heading “ Description of Business – Regulatory Framework Outside of Canada – Australia ”.

“ TGOD ” means The Green Organic Dutchman Ltd., a wholly-owned subsidiary of the Company.

“ TGOD Europe ” means TGOD Europe B.V., a wholly-owned subsidiary of the Company.

“ THC ” means delta-9-tetrahydrocannabinol, an intoxicating chemical compound in cannabis.

“ Trust ” has the meaning ascribed thereto under the heading “ Directors and Officers – Cease Trade Orders, Bankruptcies, Penalties or Sanctions ”.

“ TSX ” means the Toronto Stock Exchange.

“ Underlying Shares ” has the meaning ascribed thereto under the heading “ General Development of the Business – Three-Year History – Galaxie Brands Corporation Acquisition ”.

“ U.S. ” means the United States.

“ USDA ” has the meaning ascribed thereto under the heading “ Description of Business – Regulatory Framework Outside of Canada – United States ”.

“ U.S. FDA ” means the United States Food and Drug Administration.

“ Warrant ” means the December 2019 Warrants, the June 2020 Warrants, the October 2020 Warrants and the December 2020 Warrants, trading under the symbols TGOD.WS, TGOD.WR, TGOD.WA and TGOD.WB, respectively.

“ WHO ” has the meaning ascribed thereto under the heading “ Description of Business - General ”.

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CORPORATE STRUCTURE

Name, Address, and Incorporation

The Company was incorporated under the federal laws of Canada pursuant to the CBCA on November 16, 2016. The Company’s registered office and head office is located at 6205 Airport Rd, Building A – Suite 200, Mississauga Ontario L4V 1E3. The Company provides corporate services to all of its subsidiaries including but not limited to: sales and marketing; accounting; human resources; legal; finance; and corporate development. The Company’s Common Shares are listed on the CSE under the trading symbol “TGOD” and on the OTCQX under the symbol “TGODF”. The Company also has four classes of Warrants listed on the CSE under the symbols, “TGOD.WS”, “TGOD.WR”, “TGOD.WA” and “TGOD.WB”.

Intercorporate Relationships

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Note:

(1) Galaxie also holds a minority interest in a company formed under a joint venture related to cannabis edibles (see “ Description of Business – Cannabis Edibles”) .

The Green Organic Dutchman Ltd.

The Company, through its wholly-owned operating subsidiary, The Green Organic Dutchman Ltd. (“ TGOD ”), a licensed producer under the Cannabis Act (“ Licensed Producer ”), holds a standard cultivation and processing licence (the “ Licence ”) that allows the Company to produce dried and fresh cannabis, cannabis plants and seeds, cannabis oils, cannabis topicals, cannabis extracts and edible cannabis at its 100-acre property near Hamilton, Ontario (the “ Hamilton Facility ”) and to sell such cannabis products within Canada to provincially authorized retailers (each, an “ Authorized Retailer ”), distributors (each, an “ Authorized Distributor ”) and federally licensed entities (each, a “ Licensee ”) in accordance with the Cannabis Act and Cannabis Regulations. The Licence was amended in October 2018 to include the sale of dried marijuana to customers. The Company, through TGOD, also holds a research licence (the “ Research Licence ”) for its Hamilton Facility. TGOD was incorporated under the federal laws of Canada pursuant to the CBCA on January 10, 2013. The registered office of TGOD is at 6205 Airport Rd, Building A – Suite 200, Mississauga Ontario L4V 1E3.

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Galaxie Brands Corporation

The Company’s wholly-owned subsidiary, Galaxie Brands Corporation (“ Galaxie ”), formerly known as Green Relief Inc., was amalgamated under the OBCA on November 1, 2017 and, is a Licensed Producer under the Cannabis Act. Galaxie holds a standard cultivation and processing licence (the “ Galaxie Licence ”) to produce dried and fresh cannabis, cannabis plants and seeds, cannabis oils, cannabis topicals, cannabis extracts and edible cannabis at the Company’s leased facility in Puslinch, Ontario (the “ Puslinch Facility ”), which is an approximately 26,000 square feet (“ sq. ft .”) facility with 2.0 capabilities. The Galaxie Licence also allows Galaxie to sell such cannabis products within Canada to Authorized Retailers and Distributors and licensees. See “ General Development of the Business ” for further information on the Company’s acquisition of Galaxie (the “ Galaxie Transaction ”).

Medican Organic Inc.

The Company’s wholly-owned subsidiary, Medican Organic Inc. (“ Medican Organic ”) was incorporated under the QBCA on September 19, 2017. It was a Licensed Producer under the Cannabis Act, and held a standard cultivation and processing licence (the “ Medican Licence ”) to produce dried and fresh cannabis, cannabis plants and seeds, cannabis oils, cannabis topicals, cannabis extracts and edible cannabis at the Company’s state-of-the-art cultivation and processing facility near Valleyfield, Québec (the “ Quebec Facility ”) and to sell such cannabis products within Canada to Authorized Distributors and Licensees.

On June 22, 2021, the Company completed the sale of the majority of its assets in Valleyfield, Quebec, including all of the industrial and agricultural land, main hybrid greenhouse, rooftop greenhouse, all support buildings and certain related equipment (the “ Valleyfield Assets ”) to Cannara for gross proceeds of $27 million (the “ Quebec Disposition ”). The Company was also refunded the deposit that it had paid to Hydro-Quebec, including interest of $5.8 million. Concurrent with the Quebec Disposition, the Company repaid the remaining principal balance on its Credit Facility, including a 2% prepayment penalty, to settle all of its outstanding obligations under the Credit Facility and terminated the loan agreement with such lender.

In connection with the Quebec Disposition, the Company successfully transferred its Medican Licence relating to the Valleyfield Assets to Cannara on September 24, 2021. Under a service agreement entered into with Cannara on September 26, 2021 (the “ Cannara Service Agreement ”), Medican Organic, pursuant to the Medican Licence since transferred to Cannara, will provide services in one growing zone at the Quebec Facility (approximately 80,000 square feet of cultivation and processing space) to produce the Company’s premium certified organic cannabis in Valleyfield, Quebec, including all 2.0 product manufacturing.

HemPoland sp. z.o.o

HemPoland sp. z.o.o. (“ HemPoland ”) is an indirectly wholly-owned subsidiary of the Company incorporated under the laws of Poland. HemPoland operates a hemp cultivation and extraction business based in Poland which was acquired by the Company on October 1, 2018. HemPoland is a manufacturer and marketer of premium CBD oils and related products. HemPoland is an indirectly wholly-owned subsidiary of the Company. As described in “ General Development of the Business ”, HemPoland remains classified as held for sale due to an anticipated sale to a third-party buyer.

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TGOD Europe B.V.

TGOD Europe B.V. (“ TGOD Europe ”) is a wholly-owned subsidiary of the Company incorporated under the laws of the Netherlands on July 31, 2018, to function as the Company’s European holding company.

GENERAL DEVELOPMENT OF THE BUSINESS

Three-Year History

CSE Listing

On September 10, 2021, the Company voluntarily delisted its Common Shares and Warrants from the TSX and, on September 13, 2021, the Company listed its Common Shares, and Warrants on the CSE (the “ CSE Listing ”). The Common Shares now trade under the trading symbol “TGOD” and on the OTCQX under the symbol “TGODF”. The Company also has four classes of warrants listed on the CSE under the symbols, “TGOD.WS”, “TGOD.WR”, “TGOD.WA” and “TGOD.WB”.

The CSE Listing was a result of the Board and management of the Company believing that listing the Common Shares and Warrants on the CSE will be beneficial to the Company and its securityholders, as a result of the Company being subject to reduced filing fees and obligations. In line with recent corporate objectives, the CSE Listing will also allow the Company to accelerate plans for an entry into the United States market and to show credibility in terms of being able to make an investment or complete a transaction in the United States market.

Licensing History

On April 18, 2019, the Company received its oil sales licence from Health Canada, pursuant to the Cannabis Act, for the Hamilton Facility.

On August 2, 2019, the Company announced that it has successfully renewed its Licence for the Company’s Hamilton Facility until August 2022, subject to customary renewals thereafter.

On February 20, 2020, the Company announced that it received its Research Licence from Health Canada. Valid for five years, the Research Licence allows the Company to reduce the cost and accelerate the pace at which it develops new products by reducing reliance on third parties.

On September 24, 2021, the Company successfully transferred its Medican Licence relating to the Valleyfield Assets to Cannara in connection with the Quebec Disposition. See “ General Development of the Business – Quebec Facility Construction and Operation Updates ”.

Exclusive Licence for Stillwater Foods’ RIPPLE SC

On May 29, 2018, the Company announced that it entered into an exclusive licensing agreement (the “ Licensing Agreement ”) with Stillwater Brands, Inc. (“ Stillwater ”) to licence RIPPLE SC (Soluble Cannabinoids) ingredient technology, and other proprietary beverage and food technologies and formulations related to cannabinoid-infused consumer packaged foods including micro-dose and full-dose tea sticks within Canada and certain international jurisdictions outside of the United States. Leveraging Stillwater's proprietary technology, TGOD launched its first Cannabis 2.0 product at the end of March 2020 – TGOD Infuser 10mg THC. G

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Recent Changes in Key Executives and Board Members

Mr. Csaba Reider, President, departed from the Company on January 9, 2020.

On November 10, 2020, Mr. Brian Athaide, Chief Executive Officer, departed from the Company and Mr. Sean Bovingdon was appointed Interim Chief Executive Officer. In addition, Michel Gagné, Vice President of Operations, was appointed Chief Operating Officer overseeing the Company’s cultivation and processing operations, supply chain and product development.

On December 31, 2020, Ms. Anna Stewart resigned as Corporate Secretary and General Counsel of the Company and Ms. Rosanna Mastropietro was appointed Corporate Secretary effective January 1, 2021.

On March 9, 2021, the Company announced that its Board has appointed Sean Bovingdon as Chief Executive Officer, member of the Board, and interim Chief Financial Officer.

On June 29, 2021, at the Company’s annual general and special meeting of shareholders, the shareholders approved the number of directors of the Company to be fixed at seven (7) from six (6), and approved the election of all existing directors with the addition of Adam Jaffe.

On July 15, 2021, the Company announced that Gayle Duncan had joined the Company’s senior leadership team as Chief Growth Officer, a newly created position aimed at enhancing existing sales and marketing capabilities and increasing brand awareness across North America.

In connection with the closing of the Galaxie Transaction on November 17, 2021, Angus Footman and Olivier Dufourmantelle, joined the Board, with Mr. Footman appointed as Chairman of the Board. Mr. Dufourmantelle was also appointed as President of U.S. Operations of the Company. In connection with Mr. Footman’s appointment as Chairman of the Board, the former Chairman, Jeffrey Scott, stepped down as Chairman of the Board and appointed as Lead Director of the Company, responsible for overseeing the Company’s governance principles. In addition, in connection with the closing of the Galaxie Transaction, John Bell, who was formerly a director of Galaxie, joined the Company as an advisor to the Board (“ Advisor ”). Concurrent with the closing of the Galaxie Transaction, Marc Bertrand resigned as a Director of the Company and transitioned to act as an Advisor to the Board alongside Mr. Bell.

On December 9, 2021, the Company announced that Rachel D’Silva had joined the Company’s management team as Vice President Sales – Galaxie, and will be managing key accounts for the Company in addition to managing sales growth for Galaxie’s Cruuzy brand.

On December 9, 2021, the Company announced the departure of Gayle Duncan as Chief Growth Officer effective December 31, 2021.

On December 13, 2021, Mr. Bell resigned as an Advisor to the Board.

On December 21, 2021, the Company announced that Louis Sterling, III had joined the Board, replacing Jeffrey Scott, who resigned from his position as Board Member and as Lead Director. In addition, Mr. Jacques Dessureault was appointed Lead Director of the Board.

On January 24, 2022, the Company announced that Chris Schnarr was appointed to the Board.

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On February 1, 2022, the Company announced that Nichola Thompson had been appointed as the Chief Financial Officer of the Company. Prior to this appointment, Ms. Thompson was the Chief Financial Officer of Galaxie.

On April 5, 2022, Mr. Nick Kirton, a member of the Board and the Chair of the Audit Committee, has announced his retirement from the Board. Mr. Schnarr has been appointed as the new Chair of the Audit Committee.

HemPoland

On August 21, 2018, the Company announced that it had entered into a definitive agreement to acquire 100% of the issued and outstanding shares of privately-held HemPoland, a European manufacturer and marketer of premium organic CBD oils (the “ HemPoland Acquisition ”). The HemPoland Acquisition consideration consisted of approximately $9.9 million in cash and 1,968,323 restricted share units that are each convertible to Common Shares (the “ HemPoland RSUs ”). 1,958,481 of the HemPoland RSUs vested on October 1, 2021, at which time Common Shares were issued to the former shareholders of HemPoland in exchange for the HemPoland RSUs. As at December 31, 2021, there are 9,842 HemPoland RSUs issued and outstanding. In addition, pursuant to the terms of the HemPoland Acquisition, former shareholders had an opportunity to receive performance-based incentives in additional cash or Common Shares contingent on the achievement of certain financial goals by fiscal 2021. The milestone financial goals were not achieved; therefore, no additional performance-based incentives were paid out. The HemPoland Acquisition was completed on October 1, 2018.

In Q3-2021 the Company engaged with advisors for the sale of Company’s entity in Poland, HemPoland S.p.a. Z.o.o. (the “ HemPoland Disposition ”), which was deemed non-core to future operations and the Company strategy. Preliminary Board approval and lender consents were obtained to proceed with the contemplated transaction. The Company anticipates completing the sale of all of the shares of HemPoland (the “ HemPoland Operations ”) within the next twelve months. As a result of this assessment, the Company has classified the business as held for sale and discontinued operations. Based on the fair value of the net assets associated with the HemPoland Operations using a market approach (level 2 fair value hierarchy), the Company has included the following assumptions:

• Gross proceeds of approximately $11.74 million are expected to be recorded on the sale;

• Expected transaction costs are estimated at $0.70 million; and

• The Company is expected to repay an approximate $5.49 million loan to HemPoland, for overall net proceeds of $5.55 million.

As at December 31, 2021, management was committed to a plan to sell HemPoland. Accordingly, the Company has presented HemPoland as a disposal group held for sale. Efforts to sell the disposal group have started and a sale is expected within the next twelve months. The results of the HemPoland Operations have been classified as discontinued operations based on management’s determination that these operations constituted a major component of the Company’s operations where the proceeds of sale would provide significant cash and working capital to fund the growth and operations of the Canadian business and repay some debt, without significant dilution.

Financings

On November 26, 2019, the Company announced that it had entered into an agreement with a syndicate of underwriters led by Canaccord in respect of a short form prospectus offering, on a bought deal basis. On December 2, 2019, the Company announced that it had amended its bid letter with the underwriters to upsize the offering. On December 19, 2019, the Company announced the closing of the

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offering, including the full exercise of the underwriter’s over-allotment option. A total of 36,800,000 units of the Company, comprised of one Common Share and one-half of one Common Share purchase warrant (the “ December 2019 Warrants ”), were issued for aggregate gross proceeds of $27.6 million. On closing of the offering, the Company’s December 2019 Warrants commenced trading on the TSX under the trading symbol “TGOD.WS”.

On December 13, 2019, the Company announced that it had entered into a binding term sheet for a senior secured first lien credit facility with a commercial lender for gross proceeds of up to $41.7 million (the “ Credit Facility ”). On December 24, 2019, the Company announced the closing of the first tranche of the Credit Facility for gross proceeds of approximately $27.7 million. In connection with the closing of the first tranche of the Credit Facility, the Company issued the lender 7,000,000 Common Share purchase warrants exercisable for a period of 36 months following the date of issuance at a price per share of $1.00.

On April 14, 2020, the Company executed an amendment to the Credit Facility (the “ First Loan Amendment ”) which contained an accordion feature of up to $15 million based on the Company meeting certain operational milestones. The First Loan Amendment made $5 million of the accordion available upon closing an equity financing which was achieved on April 27, 2020, with the Company thereby receiving gross proceeds of the accordion loan of $5 million. In addition, on April 27, 2020 a total of 1,500,000 warrants of the Company were issued to the lender of the Credit Facility which are exercisable at $0.39 for 36 months from the date the warrants were issued, each into one Common Share of the Company.

On April 22, 2020, the Company closed a secured revolving credit facility (the “ Revolver Loan ”) which provided the Company with gross proceeds of $10 million with further funding available of up to an additional $20 million secured on eligible trade receivables and inventory. As part of the agreement, a total of 3,000,000 warrants of the Company were issued to this lender exercisable at $0.39 for 36 months from April 22, 2020, each into one Common Share of the Company. On May 27, 2020, the Company executed an amendment with the lender of the Revolver Loan which extended the original term by six months to October 1, 2021 and allowed the Company to receive $3 million in gross proceeds from the $20 million revolving component subject to the same terms of the first $10 million previously advanced by this lender (the “ First Credit Amendment ”). In consideration of this, a total of 500,000 warrants were issued on May 22, 2020 to this lender exercisable at $0.50 for 48 months from the date of issuance. The Company received this $3 million on July 7, 2020.

On April 27, 2020, the Company completed a bought-deal equity financing of 20,536,700 units of the Company at $0.28 per unit for gross proceeds of $5.75 million. Each unit consists of one Common Share of the Company and one-half of one Common Share purchase warrant of the Company with each full warrant being exercisable into one Common Share of the Company at an exercise price of $0.38 for 36 months.

On June 12, 2020, the Company completed a bought-deal equity financing of 43,125,000 units of the Company at $0.40 per unit for gross proceeds of $17.25 million. Each unit consisted of one Common Share of the Company and one Common Share purchase warrant of the Company with each warrant exercisable at $0.50 into one Common Share of the Company for 48 months from the closing date of the transaction.

On October 1, 2020, the Company agreed to amend the terms of the Revolver Loan to extend the maturity date to December 31, 2021 in exchange for Common Share purchase warrants to purchase 500,000 Common Shares at a price of $0.30 per share for a period of 60 months (the “ Second Credit Amendment ”).

On October 2, 2020, the Company agreed with its senior lender to extend the maturity date for the Credit Facility to December 15, 2021 in exchange for payment of a financing fee of $0.4 million; repricing

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of Common Share purchase warrants to purchase 7,000,000 Common Shares expiring December 20, 2022 from an exercise price of $1.00 per Common Share to an exercise price of $0.30 per Common Share; and issuance of additional Common Share purchase warrants to purchase 1,000,000 Common Shares at an exercise price of $0.30 for a period of 60 months.

On October 23, 2020, the Company closed a short form prospectus offering for aggregate gross proceeds of $12.78 million by issuing a total of 53,263,400 units of the Company at a price per unit of $0.24. Each unit was comprised of one Common Share of the Company and three-quarters of one Common Share purchase warrant of the Company (the “ October 2020 Warrants ”), with each whole warrant being exercisable at $0.30 into one Common Share of the Company for a period of 60 months.

On November 27, 2020, the Company filed a final base shelf prospectus (“ Base Shelf Prospectus ”), qualifying the distribution of up to $50 million in aggregate initial offering amount of various debt and equity securities of the Company over a period of up to 25 months from the date of the Base Shelf Prospectus through the filing of prospectus supplements. Prior to December 31, 2021, the Company filed two prospectus supplements under the Base Shelf Prospectus, including:

• on December 2, 2020, the Company filed an at-the-market (“ ATM ”) prospectus supplement qualifying the distribution of Common Shares having an aggregate sale price of up to $15 million from time to time through Canaccord, as agent, at a price equal to the then prevailing market price of the Common Shares at the time of each distribution. The Company did not issue any Common Shares under its ATM for the year-end December 31, 2020. However, as of the date hereof, the Company has issued approximately 21,939,458 Common Shares under the ATM for gross proceeds of approximately $9.72 million.

• on December 10, 2020, the Company completed a bought deal equity financing as part of a prospectus supplement to its Base Shelf Prospectus whereby it issued 45,178,900 units of the Company at $0.28 per unit for gross proceeds of approximately $12.65 million. Each such unit consisted of one Common Share and one Common Share purchase warrant of the Company (the “ December 2020 Warrants ”) exercisable into one Common Share at an exercise price of $0.35 for a period of 60 months from the closing date of the transaction. On December 16, 2020, the Company’s December 2020 Warrants commenced trading on the TSX under the trading symbol “TGOD.WB”.

In June 2021, the Credit Facility was repaid in full and extinguished in connection with the Quebec Disposition.

On September 30, 2021, the Company announced that it had agreed with the lender of the Revolver Loan, which now has security of the Company’s main operating facility following the extinguishment of the Credit Facility, to renew its Revolver Loan and extend the maturity date to June 30, 2023 (the “ Amended and Restated Credit Agreement ”). As part of the renewal, the Company’s overall Revolver Loan was to be reduced from $30 million to $25 million total, within which the term loan portion was increased to $17 million from $16 million. The revolving component represented the $8 million balance of the total. The Revolver Loan is secured primarily by the Company’s Hamilton Facility and trade accounts receivable. In conjunction with the changes mentioned above, the Company paid a 2% commitment fee in Common Shares on September 30, 2021. In exchange, the Company has agreed to a financial covenant requiring achievement of positive EBITDA (as defined by the lender) on a monthly basis by March 31, 2022. All other terms for the Revolver Loan facility remained the same as before. Further, in connection with the Galaxie Transaction, Galaxie had agreed to become a guarantor under the guarantee agreement dated March 31, 2020 granted by the Company, The Green Organic Hemp Ltd., and Medican Organic, in favour of the lender under the Revolver Loan, to guarantee the obligations of the Company as it relates to

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the Revolver Loan, and Galaxie entered into a general security agreement to secure its guarantee obligations.

On November 30, 2021, the Company announced that it had further amended the terms of the Revolver Loan to, among other things: (i) increase the term portion of the Revolver Loan from $17 million to $20 million; (ii) issue 3,000,000 Warrants to the lender and certain affiliates of the lender entitling the holder to purchase one Common Share for a period of 60 months from the issue date at an exercise price of $0.14 per Common Share; (iii) update certain covenants set forth in the Revolver Loan, including requiring the achievement of positive EBITDA on a monthly basis to April 30, 2022; and (iv) permit the Company to terminate the Revolver Loan without the lender’s consent upon 90 days written notice, subject to payment of all outstanding amounts accrued under the Revolver Loan. All other terms of the Revolver Loan will remain the same as before, including the maturity date of June 30, 2023 and the limit to remain at $25 million.

On March 10, 2022, the Company announced that it had further amended the terms of the Revolver Loan to, among other things: (i) increase the revolving facility limit by $5 million to $30 million; (ii) allow certain inventory to be included as collateral; and (iii) relax certain non-financial covenants set forth in the Revolver Loan. All other terms of the Revolver Loan will remain the same as before, including the maturity date of June 30, 2023. As consideration of the amendment, the Company has issued a total of 500,000 Common Shares to the lender and certain affiliates of the lender based on an issue price of $0.10 per Common Share.

Pro-cert Organic Certifications

On March 5, 2019, the Company announced that it received organic certification from Pro-Cert Organic Systems Ltd. (“ Pro-Cert ”) for its Hamilton Facility, an internationally recognized leader in organic certification.

HemPoland Organic Certification

On April 26, 2019, HemPoland received organic certification from EKOGWARANCJA PTRE. The organic certification was provided by the Polish Center for Accreditation on authority from the Minister of Agriculture and Rural Development. HemPoland’s facilities, production processes and product offerings are certified organic.

Hamilton City Council Approval

On May 2, 2019, the Company announced that Hamilton City Council and the Company finalized and signed a settlement offer, and that the Local Planning Appeal Tribunal approved the settlement at a meeting, to resolve certain zoning issues relating to TGOD’s ability to operate its cannabis greenhouse in Hamilton, Ontario.

Approval of Facility Expansion by Health Canada

On May 10, 2019, the Company obtained approval from Health Canada, under the Cannabis Regulations, to expand operations into its new state-of-the-art building located in Hamilton, Ontario. The 20,000 square feet indoor facility is used for cannabis cultivation.

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Commencement of Sales in the Adult Use, Recreational Market

On August 16, 2019, the Company announced its inaugural pilot shipment of product to the OCRC, marking the Company’s entrance into Canada’s recreational cannabis market.

Health Canada Approval for Cultivation Operations

On September 3, 2019, the Company announced that it had received approval from Health Canada to expand operations at its Hamilton Facility into its 101,000 square foot hybrid greenhouse.

Health Canada Approval of Facility Expansion – Hamilton Facility

On March 30, 2020, the Company announced that it had secured a licence amendment from Health Canada in respect of the support building for cannabis processing at the Hamilton Facility. Valid until August 16, 2022, this amendment permits more space and flexibility for the Company to process cannabis for sale as dried flower, oils or in cannabis 2.0 products.

Cost Reduction Initiatives and Consolidation of Cultivation at the Hamilton Facility

On March 25, 2020, the Company announced that in response to market conditions, it adapted operations and aggressively reduced costs, including by postponing the start-up and construction of its Québec Facility in order to centralize cultivation in Canada at its Hamilton Facility. The Company also undertook further cost reduction measures including some temporary salary reductions and a freeze on nonessential recruitment and consultancy work.

The Hamilton Facility is complete with the hybrid greenhouse growing space which is being utilized for normal growing operations. The processing centre was completed from a construction perspective in 2020 and Health Canada approval was obtained.

Quebec Facility and Operation Updates

On September 16, 2020, the Company provided an update on its Québec Facility, announcing that it had completed the necessary equipment transfers to transform the Québec Facility into a production and processing hub for its 2.0 products following challenges with third-party processing. Production at the Québec Facility of dissolvable powders, premium teas and concentrates has commenced, as have sales of hash under the Company’s Highly Dutch brand.

On February 19, 2021, the Company announced that it was seeking to monetize under-utilized assets at its Québec Facility and had retained the services of a commercial real estate advisor to identify potential buyers for the site, focused on the state-of-the-art hybrid main greenhouse.

On June 22, 2021, the Company completed the Quebec Disposition whereby it sold the Valleyfield Assets to Cannara for gross proceeds of $27 million. The Company was also refunded the deposit that it had paid to Hydro-Quebec, including interest of $5.8 million. Concurrent with the Quebec Disposition, the Company repaid the remaining principal balance on its Credit Facility, including a 2% prepayment penalty, to settle all of its outstanding obligations under the Credit Facility and terminated the loan agreement with such lender.

On September 24, 2021, the Company successfully transferred its Medican Licence relating to the Valleyfield Assets to Cannara. Pursuant to the Cannara Service Agreement, entered into on September 26, 2021, Medican Organic, pursuant to the Medican Licence since transferred to Cannara, will provide services

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in one growing zone at the Quebec Facility (approximately 80,000 square feet of cultivation and processing space) to produce the Company’s premium certified organic cannabis in Valleyfield, Quebec, including all 2.0 product manufacturing.

The Company will continue to source opportunities for additional cultivation space, primarily in Quebec and British Columbia, both to own or operate directly, or through third party contractor engagements.

Medical Cannabis by Shoppers™ (“ Shoppers ”) Supply Agreement

On May 19, 2020, the Company signed a supply agreement with Shoppers, a subsidiary of Shoppers Drug Mart Inc., making its certified organic medical cannabis products available via the Shoppers online medical cannabis sales platform.

On February 1, 2021, the Company unveiled plans to transition its medical business to a wholesale model, in line with other pharmaceutical products' distribution models. The Company supported its patients throughout the transition periods which was completed April 1, 2021. The Company’s patient-centered approach will enable easier access to a broad range of medical cannabis products without having to register with multiple licensed producers. Shoppers Drug Mart Inc. represents Canada’s largest pharmacy network, and the Company is its largest supplier of organically grown medical cannabis. The Company also has seven ( 7) agreements with other medical distributors and clinics, with plans to increase its presence within the medical market as it transitioned from its legacy direct-to-patient model.

Entry into Québec Adult Use Recreational Market

On May 26, 2020, the Company announced that it had launched key products under Highly Dutch, a mainstream brand of certified organic cannabis at an accessible price, as well as cannabis-infused teas, in the province of Québec. Highly Dutch was first made available in Québec in a 28-gram (“ g ”) format, before launching across the rest of Canada in the Fall of 2020. The first product launched under the Highly Dutch brand was Rotterdam Indica, a high-THC flower now available across Canada.

EU-GMP Certification Update

On July 10, 2020, the Company announced that its Hamilton Facility had obtained a European Union Good Manufacturing Practice (" EU-GMP ") preliminary certificate enabling it to commence the process to export to Germany. Under this EU-GMP preliminary certificate, which was valid until December 31, 2020, but has been extended until the German inspectorate has completed its review, the Company can commence exporting its premium certified organic products for validation in preparation for commercialization.

On November 24, 2020, the Company announced that it has received an Export Certificate from Health Canada. This certificate enabled the Company to complete its first shipment of medical cannabis to where it will undergo stability testing, the last step before the Company can commence commercialization. The Company chose to obtain its EU-GMP certification from Germany because of its high standards and its progressive medical cannabis framework. The Company is awaiting a final physical inspection of the Hamilton Facility by the German inspector in 2022 and anticipates that once completed, it would be able to commence commercialization in Germany and to ship to several international jurisdictions, where regulations permit.

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Galaxie Brands Corporation Acquisition

On November 17, 2021, the Company completed the Galaxie Transaction, whereby, pursuant to a share purchase agreement (the “ Galaxie Agreement ”) the Company acquired of all of the issued and outstanding shares of Galaxie (the “ Purchased Shares ”), an Ontario corporation in the business of formulating, producing, manufacturing, selling, marketing and distributing cannabis products through authorized channels in accordance with Canadian cannabis laws and regulations. Under the terms of the Galaxie Agreement, the Company paid an aggregate purchase price of $24.27 million (the “ Purchase Price ”). The Purchase Price was comprised of: (a) 80,000,000 Common Shares valued at $12.4 million (the “ Escrow Shares ”); (b) 40,000,000 Common Shares valued at $6.2 million (the “ Indemnity Escrow Shares ”); and (c) 2,805,153 Common Shares valued at $0.44 million related to the Option Shares (as defined below). In addition, the vendors of the Purchased Shares will also be entitled to earn up to 85,714,286 Common Shares valued at $5.23 million (the “ Milestone Shares ”), subject to the achievement of certain milestones by December 31, 2022.

The Escrow Shares are subject to an escrow agreement (the “ Escrow Agreement ”) with Computershare Investor Services Inc., as escrow agent, (the “ Escrow Agent ”), whereby one sixth of these shares will be released every four months. On March 17, 2022, one-sixth of the Escrow Shares were released from escrow, with 66,666,666 Escrow Shares remaining in escrow. The Indemnity Escrow Shares and Milestone Shares will be placed into an indemnity escrow account pursuant to an indemnity escrow agreement (the “ Indemnity Escrow Agreement ”) with the Escrow Agent, to be released no later than December 31, 2023 and January 31, 2023, respectively, subject to earlier release pursuant to the escrow release terms of the Indemnity Escrow Agreement. All issued and outstanding options to acquire shares of Galaxie (the “ Galaxie Options ”) will fully vest prior to the closing of the acquisition, and each holder of Galaxie Options had the option of exercising its Galaxie Options into underlying shares of Galaxie (the “ Underlying Shares ”). The Underlying Shares were converted into Common Shares at the closing of the Galaxie Transaction in accordance with the terms of the Galaxie Agreement. A total of 2,805,155 Common Shares (the “ Option Shares ”) were issued to holders of Galaxie Options in exchange for the issued and outstanding Underlying Shares.

Galaxie operates out of the Puslinch Facility, which is approximately 26,000 square feet (“sq. ft.”) and is a licensed producer under the Cannabis Act and holds a licence to produce cannabis plants, cannabis plant seeds, dried cannabis, fresh cannabis, cannabis oils, cannabis topicals, cannabis extracts and edible cannabis and sell such cannabis products within Canada to Authorized Retailers and Distributors and federally licensed entities, in both the medical and adult-use markets. Galaxie is focused on product innovation, branding and manufacturing 2.0 products. Galaxie creates and produces a range of products including premium cannabis edibles, infused pre-rolls, innovative flavoured vapes, oils and solventless products. It also provides manufacturing and product development services to partners across Canada.

Management believes that the Galaxie Transaction will allow the Company to expand and diversify its portfolio as follows:

• Gaining exposure to the valuable edible category, through Galaxie’s exclusive joint venture in Canada with the major U.S. edible brand WYLD which sells a range of cannabis edibles made with unique cannabinoids and flavors.

• Leveraging Galaxie’s diverse 2.0 portfolio and gaining access to its product development expertise and formulation lab capabilities. This will expand its offering to include innovative infused prerolls, flavoured vapes, and solventless products, being deployed across all brands.

• Benefiting from improved regional distribution across Canada, providing product expansion capabilities into British Columbia for TGOD and Highly Dutch brands, and into Quebec for Galaxie’s Cruuzy brand.

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• The close proximity of the Puslinch Facility and Hamilton Facility provides the Company with additional processing, packaging, extraction and product development capabilities, allowing for optimization of operations.

The Puslinch Facility, coupled with the Company’s existing 166,000 sq. ft. state-of-the-art growing operations at the Hamilton Facility, and 80,000 sq. ft. of available cultivating and manufacturing space at the Quebec Facility, positions the Company to continue to expand, and move towards profitability.

As at the date of this Annual Information Form, operations at the Puslinch Facility are continuing as disclosed. There have been synergies realized in the areas of accounting, quality assurance, supply chain and operations, with continuing efforts to improve efficiencies in operations and information technology systems.

U.S. Market Entry Plans & CSE Listing

With the continued regulatory progress in the U.S. towards the decriminalization and legalization of cannabis in some form in various states, and the MORE Cannabis Act and the SAFE Banking Act both passing through the U.S. House of Representatives, the Company continues its exploration of strategic options towards a potential U.S. entry.

In furtherance of the Company’s U.S. entry goals, the Company successfully delisted its shares from trading on the TSX on September 10, 2021 and began trading on the CSE on September 13, 2021. The Company expects this change to allow for additional investment capability into the US.

On June 29, 2021, the Company expanded its number of members of the Board to seven directors to add an additional member with U.S. market experience. In addition, as noted above, effective November 17, 2021, pursuant to the completion of the Galaxie Transaction, Olivier Dufourmantelle is now serving as a director of the Board and President of U.S. Operations. In his previous roles at Canopy Growth Corp. and Galaxie, Mr. Dufourmantelle worked on strategic U.S. partnerships and created industry relationships in the U.S. market.

Refer to the Company’s summary of regulatory framework for the U.S. market in the “ Regulatory Framework Outside of Canada ” section below.

Other Strategic Initiatives

The Company continues to review other strategic initiatives to maximize shareholder value. The Company also continues to pursue international and partnership growth opportunities in Germany, Mexico, Australia and South Africa.

On August 25, 2021, the Company announced that it had completed its first international commercial shipment consisting of cannabis flower and other extracts destined for the highly anticipated South African medical cannabis market. The Company believes its cannabis flower is the first to be distributed legally in the country at a commercial scale and all products have received the approval of the South African Health Products Regulatory Authority (“ SAHPRA ”).

In 2020, TGOD signed a distribution agreement with LeafCann Group Pty Ltd. (“ LeafCann ”) for the Australian and New Zealand medical cannabis markets. On October 19, 2021, the Company completed its first commercial shipment of cannabis oils destined for the Australian medical cannabis market with LeafCann, which marked the Company’s entry into the Asia‐Pacific market. The Company expects to introduce more cannabis products to the Australian and New Zealand markets in 2022.

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The Company is one of very few Canadian licenced producers with access to the Mexican market, with four (4) SKUs already well into the review process by the COFEPRIS.

Refer to the Company’s summary of regulatory framework for the international markets in the “ Regulatory Framework Outside of Canada” section below.

New Products and Distribution in 2021

On January 18, 2021, the Company announced the launch of Amsterdam Sativa under its mainstream brand, Highly Dutch. Offered in three different formats, 3.5g, 15g, and 28g, Amsterdam Sativa is initially expected to be available in Alberta, Saskatchewan, Manitoba, Ontario, Québec and Newfoundland. Amsterdam Sativa has a high potency with a THC level of above 22%. It is organically grown and expertly cured in order to maintain a balanced humidity level to protect the integrity of its terpenes and trichomes. It also features sweet floral flavours with punchy aromas. The buds included in Amsterdam Sativa are carefully selected based on quality to deliver a consistent potency and unique experience in every batch. The first product launched under the Highly Dutch brand was Rotterdam Indica, a high-THC flower, which is now available in Alberta, Saskatchewan, Manitoba, Ontario, Québec and Newfoundland. As at the date of this Annual Information Form, Highly Dutch added Organic Afghan Black and Marrakech Gold Hash, to its line of products, which are now available in British Columbia, Alberta, Manitoba, Ontario, Quebec and Newfoundland.

On February 18, 2021, the Company announced the addition of Organic Sugar Bush to its portfolio of premium strains. The Company’s Organic Sugar Bush, a high-THC Sativa variety, was developed based on feedback from consumers which presents a THC level higher than 22%, large buds, certified organically grown, and balanced humidity to preserve its terpenes and trichomes. Organic Sugar Bush gets its name from Québec’s maple forests – the source of the maple syrup used to nurture the soil it grows in. The Company’s grow team analyzed a myriad of strains before selecting Organic Sugar Bush, a strain it perfected by developing a unique cultivation method which includes the addition of maple syrup from Quebec to its proprietary living soil. The launch of Organic Sugar Bush is the continuation of the Company’s plans to introduce innovative strains as part of its premium portfolio. In fact, all of the Company’s main premium organic strains (Organic Rockstar Tuna, Organic Maple Kush, Organic Cherry Mints, as well as Organic Sugar Bush) are being consistently harvested now with potencies greater than 22% THC. As of the date of this Annual Information Form, the Organic Sugar Bush is available in Quebec, Ontario, Alberta, British Columbia and the Company continues to work on expanding distribution across all Canadian provinces.

On November 4, 2021, the Company announced it had entered into a definitive agreement with Acosta Canada Corp (“ Acosta ”) for exclusive and dedicated sales representation of TGOD’s adult recreational cannabis brands in key provinces across Canada. The Company made the strategic decision to move away from a syndicated sales model in order to enable scaled growth with a dedicated sales force through greater product education, market penetration and distribution for its TGOD™, Highly Dutch Organic™ and Ripple™ brand portfolios in the key markets of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario and Newfoundland. The Company also added a Regional Manager role for Quebec and Atlantic Canada to its team and named a Regional Manager in Calgary to support its presence in Western Canada.

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DESCRIPTION OF BUSINESS

General

The Company’s goal is to build a sustainable global cannabis company that is trusted to improve the lives of its customers, employees, communities, and investors, with a particular focus on delivering premium organic cannabis solutions.

The Company’s wholly-owned Canadian subsidiaries, TGOD and Galaxie, are licensed producers under the Cannabis Act. TGOD and Galaxie each hold cultivation and processing licences (the Licence and Galaxie Licence, respectively) which allow these entities to possess and produce cannabis and cannabis products (cannabis topicals, cannabis extracts and edible cannabis), obtain dried cannabis, fresh cannabis, cannabis plants or cannabis seeds by cultivating, propagating and harvesting cannabis. The Licence is tied to the Hamilton Facility and the Galaxie Licence is tied to the Puslinch Facility. TGOD also holds its Research Licence for the Hamilton Facility.

With the Hamilton Facility, the Company has made significant infrastructure investments in technology and automation for sanitation, growing environment and general cultivation in order to reduce risk of crop failure. This includes additional HVAC systems, dehumidification systems, plant spacing strategies, soil beds, automated water systems, automated environmental control systems, waste handling and product tracking. The Company believes it is one of only a few Licensed Producers that provides organic cannabis and the only one capable of doing it at scale.

In connection with the Galaxie Transaction, the Company acquired the Puslinch Facility located in Puslinch, Ontario, which is an approximately 26,000 sq. ft. facility with 2.0 capabilities, is fully licensed by Health Canada and operational, and is expected to provide the Company with additional cultivation, processing, packaging, extraction, and product development capabilities.

The Company also has access to 80,000 sq. ft. of available cultivating and manufacturing space at the Quebec Facility, which the Company uses to maintain a significant portion of its operations including all 2.0 products manufacturing, in Quebec.

As of the date hereof, the Company has secured supply arrangements with all provincial cannabis boards except PEI and Yukon.

In addition to its Canadian operations, the Company, through its subsidiaries and strategic investments, continues to evaluate its international growth strategy, and has established other strategic partnerships for the distribution of cannabis and hemp-derived medical products in Mexico, Germany, Australia, South Africa and other countries as regulations allow.

The outbreak of the novel strain of the coronavirus, SARS-COV-2 (“ COVID-19 ”), and its eventual declaration as a pandemic by the World Health Organization (“ WHO ”) on March 11, 2020 has resulted in governments worldwide enacting emergency measures to combat the spread of the virus. These measures have caused material disruption to businesses globally resulting in an economic slowdown. The Company rapidly implemented strategic measures to protect its global workforce from COVID‐19 and endeavouring to mitigate any long-term impact of the pandemic on its business. While it is difficult to predict the impact of COVID-19 on the Company’s business, the Company continues to seek to mitigate these impacts through various means including engagement with its retailers, transition of its staff to working remotely where possible, increasing safety protocols and sanitation measures within the workplace, and monitoring developments in order to adapt and respond in order to protect the health and safety of the Company’s employees and the best interests of the Company

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As of the date of this Annual Information Form, the Company engages approximately 322 e mployees. For more information on the Company’s executive officers see “ Directors and Executive Officers .”

Cannabis Products and Production

Under the Cannabis Act, a federal licensee, if authorized by its licence, may sell the following cannabis products: dried and fresh cannabis, cannabis oils, cannabis plants and seeds, cannabis extracts, cannabis edibles and topicals. The Company intends to sell all products that are permitted or may be permitted in the future to be sold by a federally licensed entity under the Cannabis Act. It is the Company’s intention to be a supplier of cannabis consumer packaged goods (“ CPG ”) to domestic and international markets, where it is legal to do so.

The Company grows its TGOD and Highly Dutch branded cannabis in organic living soil, free from synthetic pesticides, herbicides and fertilizers. The Company has received third party organic certification from Pro-Cert for its Hamilton Facility. Organic certification requires the organization to maintain a strict compliance to organic standards and provides third party validation to consumers that the organization is following organic principles.

The Company currently carries over 100 strains of cannabis (seed and plant form) within its genetics portfolio. The Company is able to acquire or develop additional genetics to this profile based on market demands. The Company is in process of developing more tailored genetics for the greenhouse space and organic production processes.

Dried Cannabis

The Company is currently licensed to grow and sell dried cannabis. The Company sells dried cannabis products domestically in Canada. Products are sold in the medical market (through wholesale channels, like Cannabis by Shoppers Drug Mart) and in the recreational market (to Provincial Boards and to retailers).

Under The Green Organic Dutchman brand, the Company currently grows and sells four strains of certified organic dried cannabis: Organic Rockstar Tuna, Organic Sugar Bush, Organic Maple Kush, and Organic Cherry Mints. In addition to selling these strains in traditional dried flower format, Organic Sugar Bush and Organic Rockstar Tuna are also available in pre-roll format.

Within the Highly Dutch brand, there are two flower products, Amsterdam Sativa and Rotterdam Indica, which are comprised of a rotating selection of the strains mentioned above and available in multiple sizes.

Under the Cruuzy brand, the Company sells four (4) SKUs of high-THC dried flowers which are acquired through partnerships with third party growers. These strains include; Ksmorz, Tangerine Sunrise, Terp n’Treat, and Sugar Shack.

In addition to the sale of additional strains in the Canadian market, the Company is exploring opportunities to export its dried cannabis products to international markets as regulations allow.

Cannabis Oils

TGOD is currently licensed to produce and sell cannabis oils. Cannabis oils are predominantly consumed by the medical market due to their appeal to medical patients, but a small volume of oils is also

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available for sale in the recreational market. The Company currently sells oil from the Charlotte’s Angel flower strain.

TGOD is exploring opportunities to export its cannabis oil products to international markets as regulations allow.

Cannabis Edibles

The Company is licensed to produce and sell cannabis edibles products. The Company has begun manufacturing edible products containing cannabis oil extracts as an infused ingredient.

The Regulations (as defined below) require edibles to be shelf stable and to include only those food ingredients and additives authorized under the Food and Drug Regulations (Canada). The Regulations impose limitations on the caffeine and alcohol content of edibles and, among other packaging and labelling requirements, require a simplified nutrition facts table on the packaging of edibles. Further, to process, package and label edible cannabis, companies require a federal cannabis processing licence.

Historically, producers of edible cannabis products have struggled to achieve consistent dosing and predictable impacts on the consumer. The Company has entered into a licence agreement with Caliper Foods (formerly Stillwater Foods) which allows the Company to sell Caliper’s proprietary patent-pending water-soluble powdered cannabinoid technology, RIPPLE, in Canada. This technology, which is tasteless and odourless, can be added to almost any food or beverage to infuse it with THC or CBD and has been shown in preliminary human pharmacokinetic studies to have faster absorption (within 15 minutes) and greater total bioavailability (4.5 times greater) than traditional cannabis oil products.

In Spring 2020, the Company released this first to market technology in Canada in its cannabinoid dissolvables under the RIPPLE line of unique cannabis products. These dissolvable powder products can be placed on any food or beverage and offer lots of flexibility in consumption to consumers, while ensuring the consistent efficacy that they are interested in. There are four SKUs available in the recreational and medical markets, ranging from high-THC to high CBD. In Q3 2021, the Company expanded the portfolio to include Ripple QuickSticks, a flavoured version of the dissolvable powder, which is available in two SKUs.

In January 2021, the Company launched a product in the edibles category with the introduction of RIPPLE Gummies. However, after a strategic review in Q1 considering market pressures within the edibles category, the Issuer’s management agreed to discontinue production of its RIPPLE Gummies, as such production was determined to not be economically favourable to the Issuer. This decision is not expected to materially impact the Issuer’s revenues and is expected to directly benefit the Issuer's profitability.

In connection with the Galaxie Transaction, pursuant to a joint venture agreement, the Company now produces and distributes WYLD branded cannabis gummies, a major edible brand in the U.S. which sells a range of cannabis edibles made with unique cannabinoids and flavours.

Cannabis Extracts

The Company is licensed to produce and sell cannabis extract products. The Company manufacturers multiple extract SKUs across multiple brands.

Under the Highly Dutch brand, the Company sells hash in two formats, Afghan Black and Moroccan Blonde. Both of these products are available in multiple potencies (30% THC and 40% THC) and sizes. Since originally launching these products in the Quebec market in 2021, they have been introduced in provinces across Canada. A special new SKU – six (6) Month Barrel Aged Afghan Black

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Hash, launched in February 2022 features a proprietary aging process and will be released in more provinces later in 2022. This new process for this SKU is patent pending.

Within the Cruuzy portfolio, the Company manufactures Supercharged Duubyz, a rosin infused (cannabis extract) pre-roll joint in two varieties: Indica Duubyz and Sativa Duubyz. Within the Cruuzy brand, the Company also sells three high-THC vapes, including Sugar Spice, Citrus Ice, and Mango Twist in 1g format.

Within the dried flower, edibles, and extract categories, there are commitments from provinces to list additional SKUs as 2022 progresses which will drive further portfolio innovation and growth.

Fresh Cannabis and Seeds

The Company is currently licensed to sell fresh cannabis plants and seeds to Authorized Retailers or Authorized Distributors, federal licensees and Registered Patients. The Company does not plan to sell seeds at this time and does not have the capacity in its existing facilities to produce fresh cannabis plants for purpose of resale.

Core Brands and Products

In Canada, the Company has a growing product portfolio within multiple brands which cater to a diverse set of consumer segments.

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The Green Organic Dutchman – The Green Organic Dutchman is the Company’s premiere premium brand, focusing on certified organic cannabis flower and oil. The brand is distributed through the medical and recreational channels and is targeted at consumers that value superior product quality measures and sustainable cultivation and packaging. The brand has received notable recognition from industry authorities, like High Times as one of the Top Cannabis Brands in North America, and the brand packaging routinely wins recognition as best-inclass.

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RIPPLE – The Company has licensed the RIPPLE brand from Stillwater Brands in Colorado. The consistency, flexibility and portability of the products (RIPPLE dissolvable powders and RIPPLE QuickSticks) are desirable to a variety of consumers, especially those new to cannabis edibles. It is one of the very few brands with academic studies to prove efficacy. RIPPLE’s pharmacokinetic data in human volunteers shows that cannabinoids were absorbed within 15 minutes when delivered in the RIPPLE technology, and achieves 4.5x greater absorption than cannabinoids in oil alone. For more details including a link to the full study, visit TGOD.ca/Ripple

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Highly Dutch – Highly Dutch is the Company’s mainstream brand. Within this brand, the Company sells organic flower and concentrate products (hash). This brand is targeted more towards daily cannabis consumers enabling the trial and experience of the differentiation of organic cannabis.

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– Cruuzy Cruuzy is the newest brand within the portfolio, via the Galaxie Transaction. This brand is targeted towards legacy consumers, who often use cannabis as a part of their daily routine. Within Cruuzy, the Company sells dried flower, extracts, and vapes.

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CannabiGold – Cannabigold is a brand of food supplements rich in phytocannabinoids naturally present in hemp as well as CBD-infused topicals. CannibiGold contains guaranteed concentrations of CBD and is produced using CO2 extraction.

Intellectual Property

The Company’s intellectual property consists largely of brands as well as cannabis genetics, trade secrets and know-how. The Company protects its brands through trademark registration and maintains strict confidentiality and other protective measures in respect of its other intellectual property.

Production Facilities and Licences

The Company’s products are currently primarily cultivated and manufactured in the following licensed production facilities:

Facility	Location	Licence	Licence	Licence	Licence	Licence	Licence
		Cultivation	Processing	Sales to Other LPs	Sales to Provincial Boards	Research	Expiry of Current Licence Terms
Hamilton Facility (TGOD)	Ancaster, ON						Cultivation/Processing/ Sale: August 16, 2022 Research Licence: February 12, 2025
Québec Facility(1) (Medican Organic)	Valleyfield, QC						Cultivation/Processing: June 8, 2024
Puslinch Facility (Galaxie)	Puslinch, ON						Cultivation/Processing/ Sale: February 7, 2023

Note:

(1) Pursuant to the Quebec Disposition, Medican Organic operates out of approximately 80,000 square feet of cultivation and processing space in the Quebec Facility pursuant to the Cannara Service Agreement and relying on the Medican Licence, which was transferred to Cannara on September 24, 2021. Pursuant to the Cannara Service Agreement, Medican Organic will provide services at the Quebec Facility to produce the Company’s premium certified organic cannabis. Additionally, the Company’s 2.0 products will continue to be manufactured at the Quebec Facility.

In connection with the Quebec Disposition, the Company successfully transferred its Medican Licence relating to the Valleyfield Assets to Cannara on September 24, 2021.

The Company anticipates that Health Canada will renew the Licence, the Research Licence and the Galaxie Licence at the end of their respective terms; however, the Company cannot provide assurances that the licences will be renewed or renewed on the same terms and conditions. See “ Risk Factors ”.

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The Hamilton Facility

The Company completed construction on its indoor grow rooms at the Hamilton Facility, received licensing and became operational in the third quarter of 2019. The construction of its hybrid greenhouse at the Hamilton Facility was completed in the fourth quarter of 2019, with its first harvest in early 2020. The Hamilton Facility contains cultivation and processing space. The Hamilton Facility is capable of all aspects of growing, processing, production and storage, including soil preparation, plant production, harvesting, trimming, drying, and packaging. In addition, the Hamilton Facility has its own dedicated off-grid power generation utilizing natural gas.

The Québec Facility

The Company was constructing a state-of-the-art cultivation and processing facility near Valleyfield, Québec. For strategic reasons, the Company completed the Quebec Disposition and entered into the Cannara Service Agreement, pursuant to which Medican Organic provides services in one growing zone at the Quebec Facility to produce the Company’s premium certified organic cannabis in Valleyfield, Quebec under the Medican Licence, which was transferred to Cannara. Additionally, the Company’s 2.0 products will continue to be manufactured at the Quebec Facility. Processing and packaging are completed at the Québec Facility, and then the products are transferred to the Hamilton Facility for sale and distribution.

The Puslinch Facility

Galaxie operates out of the Puslinch Facility, which is an approximately 26,000 sq. ft. facility with 2.0 capabilities, is fully licensed by Health Canada and operational, and is expected to provide the Company with additional cultivation, processing, packaging, extraction, and product development capabilities. Galaxie creates and produces a range of products including premium cannabis edibles, infused pre-rolls, innovative flavoured vapes, oils and solventless products. It also provides manufacturing and product development services to partners across Canada.

Competitive Conditions

The market for cannabis in Canada is tightly controlled by and subject to strict regulation, including pursuant to the Cannabis Act and Regulations. The Company continues to face competition from both the illicit market as well as other companies, some of which can be expected to have longer operating histories and more financial resources and manufacturing and marketing experience than the Company. Increased competition by larger and better financed competitors could materially and adversely affect the Company’s business, financial condition, results of operations and prospects.

As of the date of this Annual Information Form, Health Canada has granted cultivation, processing or cannabis sales licences to a total of 856 licence holders. The Company, through TGOD and Galaxie, holds two of those licences. More information on the current list of licence holders can be found on Health Canada’s website (https://www.canada.ca/en/health-canada/services/drugs-medication/cannabis/industrylicensees-applicants/licensed-cultivators-processors-sellers.html#wb-auto-5 ) .

The Company believes that it will face competition from the following sources:

(i) Licence Holders

As of the date of this Annual Information Form, Health Canada has granted cultivation, processing or sales licences to a total of 856 licence holders, with many more in the application phase. The Company

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believes it will face competition from other licence holders and that in the future the supply of cannabis will meet and potentially exceed the demand for cannabis. The price of cannabis and cannabis products may also continue to drop. The Company believes that it can reduce the impact of competition from licence holders by focusing on its certified organic cannabis products, being of one of only a few licenced producers in Canada that produces certified organic cannabis. The Company believes that organic cannabis will command a premium price compared to non-organic cannabis and expects that a growing segment of the cannabis market will seek out organic cannabis, even at a premium price.

Additionally, the Company believes that the stringent application and compliance requirements that must be met under the Cannabis Act and Regulations to become a licence holder may prove too onerous or expensive for some of those unlicensed applicants and is, in the Company’s view a significant barrier to entry into the industry.

(ii) Cannabis Retailers

The Cannabis Act authorizes the provinces and territories to oversee the distribution of cannabis. Various provinces have distribution models which include exclusive distribution through provinciallyowned retail stores or a mixed distribution model which will allow for regulated privately-owned retail stores to operate alongside provincially owned retail stores. The Company believes that retail competition will be from existing licence holders and new market participants. Currently the Company does not have retail operations.

(iii) Homegrown Cannabis Producers:

The Cannabis Act allows for adults to legally grow up to four cannabis plants for personal use. The Company believes that competition from homegrown cannabis will be minimal and that it will not have a significant impact on market demand for premium cannabis flower.

See “ Risk Factors ” for further details.

Cannabis Regulatory Framework in Canada

Summary of the Cannabis Act and Regulations

On April 13, 2017, the Government of Canada released Bill C-45, An Act respecting cannabis and to amend the Controlled Drugs and Substances Act, the Criminal Code and other Acts , which proposed the enactment of the Cannabis Act (Canada) to regulate the production, distribution and sale of cannabis for unqualified adult use. The Cannabis Act came into force on October 17, 2018.

On July 11, 2018, the Federal Government published regulations in the Canada Gazette, Part II, to support the coming into force of the Cannabis Act, including the Cannabis Regulations, the new IHR, along with proposed amendments to the Narcotic Control Regulations and certain regulations under the Food and Drugs Act (Canada). The Regulations, among other things, set out regulations relating to the following matters: (1) licences, permits and authorizations; (2) security clearances and physical security measures; (3) good production practices; (4) cannabis products; (5) packaging and labelling; (6) cannabis for medical purposes; (7) drugs containing cannabis; (8) combination products and devices; (9) importation and exportation for medical or scientific purposes; (10) document retention; (11) reporting and disclosure, and (12) access to cannabis for medical purposes.

Given that the Cannabis Act and its Regulations are very new, the impact of such regulatory changes on the Company’s business is unknown. See “ Risk Factors”.

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Adult-Use Cannabis

The Company participates in the Canadian adult-use market for cannabis. The Cannabis Act provides a licensing and permitting scheme for the cultivation, processing, importation, exportation, testing, packaging, labelling, sending, delivery, transportation, sale, possession and disposal of cannabis for adultuse, implemented by the Regulations. The Cannabis Act and the Regulations maintain a separate regime for access to cannabis for medical purposes.

Below are additional highlights of the Cannabis Act:

• Places restrictions on the amounts of cannabis that individuals can possess and distribute, and on public consumption and use, and prohibits the sale of cannabis unless authorized by the Cannabis Act.

• Permits individuals who are 18 years of age or older to cultivate, propagate, and harvest up to and including four cannabis plants in their dwelling-house, propagated from a seed or plant material authorized by the Cannabis Act.

• Restricts (but does not strictly prohibit) the promotion and display of cannabis, cannabis accessories and services related to cannabinoids to consumers, including restrictions on branding and a prohibition on false or misleading promotion and on sponsorships.

• Permits the informational promotion of cannabis by entities licensed to produce, sell or distribute cannabis in specified circumstances to individuals 18 years and older.

• Introduces packaging and labelling requirements for cannabis and cannabis accessories, and prohibits the sale of cannabis or cannabis accessories that could be appealing to young persons.

• Provides the designated minister with the power to recall any cannabis or class of cannabis on reasonable grounds that such a recall is necessary to protect public health or public safety.

• Establishes a national cannabis tracking system to monitor the movement of cannabis from where it is grown, to where it is processed, to where it is sold.

• Provides powers to inspectors for the purpose of administering and enforcing the Cannabis Act and a system for administrative monetary penalties.

Cannabis for Medical Purposes

As of October 17, 2018, the Cannabis Act and Regulations replaced the ACMPR as the governing regulations in respect of the production, sale and distribution of medical cannabis and related oil extracts. Further, as the Cannabis Act is now in force, cannabis is regulated under the Cannabis Act rather than the CDSA.

Part 14 of the Cannabis Regulations sets out the regime for medical cannabis following legalization, which is substantively the same as the ACMPR with adjustments to create consistency with rules for nonmedical use, improve patient access, and reduce the risk of abuse within the medical access system. Patients who have the authorization of their healthcare provider continue to have access to cannabis, either purchased directly from a federally licensed entity authorized to sell for medical purposes, or by registering to produce a limited amount of cannabis for their own medical purposes, or designating someone to produce cannabis for them.

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Licences, Permits and Authorizations

The Cannabis Regulations establish the following classes of licences:

• licence for cultivation;

• licence for processing;

• licence for analytical testing;

• licence for sales for medical purposes;

• licence for research; and

• a cannabis drug licence.

The Regulations also create subclasses for cultivation licences (standard cultivation, microcultivation and nursery) and processing licences (standard processing and micro-processing). Different licences and each sub-class therein, carry differing rules and requirements that are intended to be proportional to the public health and safety risks posed by each licence category and each sub-class. Licences that were issued under the ACMPR are deemed to be licences issued under the Cannabis Act. Licences issued under the Cannabis Act have associated expiry dates and are subject to renewal requirements.

Security Clearances

Certain individuals associated with cannabis licensees, including individuals occupying “key positions”, directors, officers, individuals who exercise, or are in a position to exercise, direct control over the corporation licensee, and other individuals identified by the Minister, must hold a valid security clearance issued by the Minister. Under the Regulations, the Minister may refuse to grant security clearances to individuals with associations to organized crime or with past convictions for, or an association with, drug trafficking, corruption or violent offences. This was largely the approach in place under the ACMPR and other related regulations governing the licensed production of cannabis for medical purposes. Individuals who have histories of nonviolent, lower-risk criminal activity (for example, simple possession of cannabis, or small-scale cultivation of cannabis plants) are not precluded from participating in the legal cannabis industry, however, grant of security clearance to such individuals is at the discretion of the Minister and such applications are reviewed on a case-by-case basis.

Security clearances issued under the ACMPR are considered to be security clearances for the purposes of the Cannabis Act and Regulations.

Cannabis Tracking System

Under the Cannabis Act, the Minister is authorized to establish and maintain a national cannabis tracking system. The cannabis tracking system (together with the licensing portal, collectively known as the “ Cannabis Tracking and Licensing System ”) was established by ministerial order, and came into effect on October 17, 2018. The purpose of this system is to track cannabis throughout the supply chain, to help prevent cannabis from being diverted to an illicit market or activity and to help prevent illicit cannabis from being a source of supply of cannabis in the legal market. Pursuant to the Cannabis Tracking and Licensing System, a holder of a federal licence for cultivation, a licence for processing or a licence for sale for medical purposes that authorizes the possession of cannabis must report monthly to the Minister with specific information about their authorized activities with cannabis (e.g. cannabis inventory quantities), in the form and manner specified by the Minister. The ministerial order also provides for monthly reporting

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by provincial bodies and provincially authorized private retailers of certain information in the form and manner specified by the Minister.

A new ministerial order regarding the Cannabis Tracking and Licensing System was published in the Canada Gazette, Part II, on June 26, 2019 and in force on October 17, 2019 in order to address the unique public health and public safety risks associated with the three new classes of cannabis, being edible cannabis, cannabis extracts and cannabis topicals (collectively, the “ New Classes of Cannabis ”) authorized by the Regulations Amending the Cannabis Regulations (New Classes of Cannabis) (the “ Amending Regulations ”) on October 17, 2019.

The purpose of this system is to enable the submission of licence applications, amendments and renewals through an online portal and track the flow of cannabis throughout the supply chain as a means of preventing the illegal inversion and diversion of cannabis into and out of the regulated system. Under the Cannabis Tracking and Licensing System, a holder of a licence for cultivation, licence for processing, or a licence for sale for medical purposes is required to submit monthly reports to Health Canada.

Cannabis Products

The Cannabis Act and Regulations set out the requirements for cannabis products that are permitted for sale at the retail level, including the limit on THC content, permitted ingredients, limit on pest control product residues, as well as microbial and chemical contaminants.

Prior to the passage of the Amending Regulations, the Cannabis Act only permitted the sale of dried cannabis, cannabis oil, fresh cannabis, cannabis plants and cannabis plant seeds. The Amending Regulations permit the production and sale of the New Classes of Cannabis. As is the case for dried or fresh cannabis and cannabis oil, a processing licence is required in order to produce edible cannabis, cannabis extracts and cannabis topicals, and to package and label these types of cannabis products for sale to consumers. Holders of processing licences issued prior to October 17, 2019 were required to amend their processing licence before they could begin manufacturing products belonging to New Classes of Cannabis. The Cannabis Regulations require the filing of a notice with Health Canada at least 60 days before releasing a new product to the market. As a result, December 16, 2019 was the earliest date that products in the New Classes of Cannabis could be made available for sale.

In addition, if a holder of a processing licence chooses to process edible cannabis and non-cannabis food products on the same site, then the production, packaging, labelling, and storage of cannabis and the production, packaging, and labelling of non-cannabis food products will need to be conducted in separate buildings. All cannabis production is required to occur in a separate building from any non-cannabis food production to minimize contamination risks.

Packaging and Labeling

The Regulations set out strict requirements pertaining to the packaging and labelling of cannabis products. These requirements are intended to promote informed consumer choice and safe consumption and allow for the safe handling and transportation of cannabis, while also reducing the appeal of cannabis to youth.

The Regulations require all cannabis products to be packaged in a manner that is tamper-proof and child-resistant. Strict limits are also imposed on the use of logos, colours, graphics, and other special characteristics of packaging. For example, all-over package coverings must be clear, and the interior surface and exterior surface of any container in which a cannabis product is packaged must be one uniform colour. Cannabis package labels must include specific information, such as (i) product source information,

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including brand name, the class of cannabis, lot number, storage conditions, expiry date and the name, phone number and email of the licensed processor or cultivator, (ii) mandatory warnings, including rotating health warning messages on Health Canada’s list of standard health warnings; (iii) a keep out of reach of children warning and the Health Canada standardized cannabis symbol; and (iv) information specifying THC and CBD content.

A cannabis product’s brand name may only be displayed once on the principal display panel or, if there are separate principal display panels for English and French, only once on each principal display panel. It can be in any font style and any size, so long as it is equal to or smaller than the health warning message. The font must not be in metallic or fluorescent colour. In addition to the brand name, only one other brand element can be displayed. Such brand element must meet the same requirements noted above as the brand name, and if an image, it must be in a size equal to or smaller than surface area of the standardized cannabis symbol.

Promotion

The Cannabis Act and Regulations outline several prohibitions regarding the promotion of cannabis products. Subject to a few exceptions, all promotions of cannabis products are prohibited unless authorized by the Cannabis Act. The restriction on promotion includes promoting cannabis or a cannabis accessory, or any service related to cannabis, including: (i) by communicating information about price or distribution, (ii) by doing so in a manner in that there are reasonable grounds to believe could be appealing to young persons, (iii) by means of a testimonial or endorsement, or (iv) by evoking positive or negative emotions about a way of life such as one that includes glamour, recreation, excitement, vitality, or risk.

The Cannabis Act sets out certain limited exceptions to the general prohibition. These include: (i) promotion of price and availability is permitted at point of sale, (ii) informational or brand preference promotion distributed in accordance with the Cannabis Act, (iii) promotions to other license holders, and (iv) by inclusion of brand elements on certain things permitted by the Cannabis Act.

While the above restrictions also apply to the New Classes of Cannabis, the Amending Regulations also prohibit certain representations and associations on products, their packages and labels and associated promotional activity, including: certain flavours in cannabis extracts (e.g. confectionary, dessert, soft drink, and energy drink); health or cosmetic benefits unless registered as a health product; energy value and nutrient content representations that go beyond those permitted in the list of ingredients and in the cannabisspecific nutrition facts table; statements reasonably likely to create the impression the edible cannabis or accessory is intended to meet particular dietary requirements; and promotion that could reasonably associate the cannabis, the cannabis accessory or the service related to cannabis with an alcoholic beverage, a tobacco product or a vaping product.

Health Products Containing Cannabis

Health Canada is taking a scientific, evidenced-based approach for the oversight of health products with cannabis that may be approved with health claims, including prescription and non-prescription drugs, veterinary drugs and medical devices. Under the current regulatory framework, health products are subject to the FDA and its regulations, and the Natural Health Products Regulations (the “ NHPR ”). The FDA and NHPR govern the manufacturing, formulation, packaging, labelling, advertisement and sale of natural health products (“ NHPs ”) in Canada. In addition, drugs and NHPs may be additionally regulated by the Cannabis Act and Regulations. For many of these products, pre-market approval from Health Canada is required.

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Product Composition

The Cannabis Regulations place restrictions on product composition specific to each type of cannabis product including specific THC limits. Examples of product-specific restrictions include:

• Edible cannabis: must be shelf stable; only food and food additives will be allowed to be used as ingredients in edible cannabis and the use of food additives will need to be in accordance with the limits and purposes that are prescribed for foods; must not have caffeine added, however the use of ingredients containing naturally occurring caffeine will be permitted in edible cannabis products provided that the total amount of caffeine in each immediate container does not exceed 30 milligrams; must not contain alcohol in excess of 0.5% w/w; must not contain anything that would cause the sale of the edible cannabis, if it was a food regulated under the FDA, to be prohibited and must not be fortified with vitamins or mineral nutrients.

• Cannabis extracts: must not contain ingredients that are sugars, sweeteners or sweetening agents, nor any ingredient listed on Column 1 of Schedule 2 to the Tobacco and Vaping Products Act (which is a list of ingredients that are prohibited in vaping products) except if those ingredients and their levels are naturally occurring in an ingredient used to produce the extract.

• Cannabis topicals: must not contain anything that may cause injury to the health of the consumer when the product is used as intended or in a reasonably foreseeable way.

Import / Export Permits for Medical or Scientific Purposes

Part 10 of the Regulations sets out the process by which a federally licensed entity may apply for an import or export permit for medical or scientific purposes, as set out in the Regulations. Import and export permits will not be issued in respect of cannabis for adult recreational use. A permit must be obtained for each shipment of cannabis. An application for an import or export permit must contain specific information including the name and address of the holder, licence number and specifics of the particular shipment including intended use of the cannabis and specific shipment details. The Regulations contain reporting requirements in respect of the import / export of cannabis in reliance of a permit issued under the Regulations.

Provincial and Territorial Regulatory Framework for Retail of Recreational Cannabis

While the Cannabis Act provides for regulation of the commercial production of cannabis and related matters by the federal government, each province and territory of Canada may adopt its own laws governing the distribution, retail sale and consumption of cannabis and cannabis accessory products within the province or territory, permitting for example, provincial and territorial governments to set lower possession limit for individuals and higher age requirements. Currently each of the Canadian provincial and territorial jurisdictions has established a minimum age of 19, except for Québec and Alberta, where the minimum age is 21 and 18, respectively.

Each province and territory is responsible for regulating a retail distribution system for adult-use cannabis in their respective jurisdiction. All Canadian provinces and territories have implemented regulatory regimes for the distribution and retail sale of cannabis for recreational purposes within those jurisdictions, and retail models vary between jurisdictions. Provincial/territorial bodies act as intermediaries between entities licensed federally under the Cannabis Act and consumers, such bodies acting in some jurisdictions as exclusive cannabis wholesalers and distributors, and in some instances such bodies acting as exclusive retailers.

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Some municipal and regional governments may also choose to impose additional requirements and regulations on the retail sale of recreational cannabis. In some provinces, municipal by-laws may restrict the number of recreational cannabis retail outlets that are permitted in a certain geographical area, or restrict the geographical locations wherein such retail outlets may be opened.

There is no assurance the Company will be able to efficiently navigate applicable regulatory frameworks and distribution models or conduct its intended business thereunder. See: “ Risk Factors ”.

Ontario : Pursuant to the Cannabis Control Act, 2017 ( Ontario ), the distribution and retail sale of recreational cannabis is managed through the OCRC, under the oversight of the AGCO. Recreational cannabis has been sold on-line through the OCRC operated OCS platform as of October 17, 2018.

On October 17, 2018, the Cannabis License Act , 2018 (Ontario) became law and other legislation, including the Cannabis Control Act, 2017 , the Ontario Cannabis Retail Corporation Act, 2017 and the Liquor Control Act were amended to create a private retail framework for the sale of recreational cannabis in Ontario. As of April 1, 2019, recreational cannabis has been available for sale by private retailers that operate brick-and-mortar stores licensed by the AGCO.

The recreational cannabis retail regulatory regime in Ontario has the following requirements and features:

• Private retailers are required to obtain both a retail operator licence and a retail store authorization. Retail store authorizations are only to be issued to persons holding a retail operator licence. Separate retail store authorizations are to be required for each cannabis retail store, but a licensed retail operator may hold more than one retail store authorization and operate multiple stores. Private retailers may sell cannabis in person, or online, with in-store pick up and/or home delivery, where available.

• The AGCO is the government entity responsible for issuing retail store authorizations for privately run recreational cannabis stores. Until December 13, 2019, a temporary cap of 25 retail store authorizations was imposed while cannabis supply stabilizes. On July 3, 2019, the Government of Ontario announced its plans for a second allocation of 50 additional cannabis retail store authorizations. The AGCO held a lottery draw for the allocation of 42 retail store authorizations. A separate process governed the allocation of eight retail store authorizations for those who wish to operate a store on a First Nations reserve. On March 2, 2020, the restrictions on the total number of store authorizations permitted in Ontario, and their regional distribution, was revoked. The AGCO has begun accepting applications for retail store authorizations from all interested applicants. There are currently 1,516 stores in Ontario.

• Retail store operators are only permitted to purchase cannabis from the OCRC, which may set a minimum price for cannabis or classes of cannabis.

• Every authorized cannabis retail store in Ontario must have a licensed retail manager. Anyone who supervises employees, oversees cannabis sales, manages compliance or has signing authority to purchase cannabis, enters into contracts or hires employees is required to have a cannabis retail manager licence.

• Federally licensed producers (and their affiliates) are limited to operating one retail cannabis store in the province, which must be located at the site listed on such producer’s federal licence. A broad definition of affiliate is included in the Regulations. An affiliate relationship exists if a corporation beneficially owns or controls voting shares, or securities that may be converted to voting shares, constituting more than 25% of voting rights. If a

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person, or group acting together, holds 50% voting control for the election of directors or market share of the corporation, they are considered affiliates. Additionally, an affiliate relationship may be established through involvement in a trust, partnership or joint venture, among others. The definition of affiliate may have the effect of restricting the ability of federally licensed producers from effectively entering into the consumer retail market in Ontario.

• Federally licensed producers are prohibited from providing any material inducement to cannabis retailers for the purpose of increasing the sale of a particular type of cannabis.

• Municipalities and reserve band councils were permitted to opt out of the retail cannabis market by resolution. Municipalities had until January 22, 2019 to pass such by-laws, and several municipalities have formally opted-out of the retail market. Municipalities that opted out can later lift the prohibition on retail cannabis stores by subsequent resolution, which cannot be reversed at a later date.

• Municipalities may not pass bylaws providing for a further system of licensing over the retail sale of cannabis.

Manitoba : The Government of Manitoba has implemented a “hybrid model” for cannabis distribution, whereby supply is secured and tracked by the Manitoba Liquor and Lotteries Corp.; however, licensed private retail stores are also permitted to sell recreational cannabis.

Alberta : The Government of Alberta has implemented a cannabis framework providing for the purchase of cannabis products from private retailers that receive their products from a governmentregulated distributor, the Alberta Gaming and Liquor Commission (“ AGLC ”), similar to the distribution system currently in place for alcohol in the province. Only licensed retail outlets are permitted to sell cannabis. As of March 8, 2022, online sales will no longer be run by the AGLC. Individual retail stores are responsible for their own online sales platforms.

New Brunswick : All recreational cannabis is managed and sold through a network of tightlycontrolled, stand-alone Cannabis NB stores managed by the Cannabis Management Corporation, a subsidiary of NBLC and is available for sale online through the Cannabis NB platform. The NBLC also controls the distribution and wholesale of cannabis in the province. The New Brunswick government had issued a request for proposals (“ RFP ”) relating to privatization of the Cannabis NB operations. New Brunswick has discontinued the RFP process in late March 2021. Cannabis NB remains the only legal retailer of recreational cannabis in the province of New Brunswick.

Québec : All recreational cannabis is managed and sold through outlets of the Société québécoise du cannabis, a subsidiary of the Société des alcools du Québec, and its online site.

Newfoundland and Labrador : Recreational cannabis is sold through licensed private retail stores, with the crown-owned liquor corporation, the NLC, issuing private retailer licences and overseeing the distribution to private sellers who may sell to consumers. The NLC also controls the possession, sale and delivery of cannabis, and sets prices. NLC is also the online retailer, although licences may later be issued to private interests.

Yukon : Yukon had initially limited the distribution and sale of recreational cannabis to government outlets and government-run online stores, but has since opened up its retail market to permit licensed private retailers in the territory. Cannabis retail licenses are issued by the Cannabis Licensing Board. Authorized retailers must purchase cannabis from the Yukon Liquor Corporation, acting as the wholesaler and distributor in the territory.

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Northwest Territories : The Northwest Territories Liquor Commission controls the importation and distribution of cannabis, whether through retail outlets or by mail order service run by the commission. Communities in the Northwest Territories are able to hold a plebiscite to prohibit cannabis, similar to the options currently available to restrict alcohol.

British Columbia : Recreational cannabis is sold through both public and licensed privately operated stores, with the provincial Liquor and Cannabis Regulation Branch handling wholesale distribution.

Saskatchewan : The Government of Saskatchewan implemented a framework in which both wholesale and retail recreational cannabis are conducted by the private sector and regulated by the SLGA. A number of retail permits have been issued to private stores. SLGA is currently accepting applications for retail permits, wholesale cannabis permits and federally licensed producer registrations. Permitted wholesalers can sell to permitted retailers and other permitted wholesalers but not to the general public. Wholesale operations must be physically located within Saskatchewan and product can only be sold and distributed within Saskatchewan. Further, only federally licensed producers registered with SLGA will be allowed to sell into the Saskatchewan market.

Nova Scotia : The NSLC is responsible for the regulation of cannabis in the province, and recreational cannabis is only sold publicly through government-operated storefronts and online sales. There is no private licensing of retail. The NSLC also controls the distribution and wholesale of cannabis in the province.

Prince Edward Island : Similar to Nova Scotia, Prince Edward Island requires cannabis to be sold publicly, through government stores and online, overseen by the Prince Edward Island Cannabis Management Corporation, who is also responsible for the distribution and wholesale of cannabis in the province. There is no private retail licensing in the province.

Nunavut : Nunavut allows for the sale of cannabis through both public and private retail and online. In Nunavut, a person can submit an application with the Nunavut Liquor and Cannabis Commission for a licence to operate a cannabis store, remote sales store, or cannabis lounge.

Several of the provinces and territories have been actively working to secure supply agreements from existing federally licensed cannabis producers. To date, the Company has entered into supply arrangements with every province, except PEI and Yukon but expect to sell into these provinces in 2022 as well. Supply arrangements with provincial cannabis boards have been negotiated by the Company and the Company directly manages the relationships with the provincial boards.

Regulatory Framework Outside of Canada

Globally, regulations surrounding medicinal and adult-use cannabis are evolving at a rapid pace. In Mexico, pharmacological derivatives of cannabis are legalized in the use of medical applications. In Europe, adult-use cannabis is not legalized; however, Europe is positioned to become the largest medical cannabis market globally. In Latin America, Chile, Colombia and Uruguay have legalized cultivation, while medical use of CBD is legal in Argentina, Chile and Colombia. In Peru and Uruguay, THC content must be less than 1%. In Argentina, Brazil, Chile, Colombia, Peru and Uruguay, pharmaceutical CBD cannabinoids are legal. Uruguay is also the first country to legalize recreational use of cannabis. In the United States, the 2018 Farm Bill was passed in December 2018, removing hemp from the definition of controlled substances under U.S. federal law. The Farm Bill defines hemp as the plant cannabis sativa L. and its derivatives, extracts and cannabinoids with THC content of not more than 0.3% on a dry weight basis.

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The Company intends to leverage its Canadian foothold to grow into new international markets as those markets legalize the sale of cannabis and hemp products. In addition to its Canadian business, the Company is adopting an international growth strategy. The Company will conduct business only in jurisdictions where such operations are legally permissible. The Company recognizes that the legal and regulatory requirements in foreign countries in which it operates are different from those in Canada. Prior to commencing any operations in a new country, the Company will partner with its legal counsel and consultants to conduct any required due diligence in order to ensure that it has a sufficient understanding of the legal, political and commercial framework and specific risks associated with operating in any jurisdiction.

Poland

In Poland, the use of hemp is generally restricted and may be accepted only if certain statutory requirements are met. Polish laws provide specific regulations, depending on the use of the hemp. Pursuant to the Misuse of Drugs Act, hemp may be grown solely and exclusively for the needs of the textile, chemical, pulp and paper, food, cosmetic, pharmaceutical and construction industries, as well as for seed production. Buying hemp from a farmer requires a permit from the governor of the province holding territorial jurisdiction over the plantation. Buying and reselling hemp seeds is subject to notification to the appropriate Provincial Inspector of Plant Health and Seed Inspection. Where hemp extracts are used for producing foodstuffs, the production facility must meet the sanitary requirements stipulated under the Act on the Safety of Food and Nutrition. The cultivation of cannabis which does not fall within the definition of hemp under the Misuse of Drugs Act, i.e. “plant species Cannabis Sativa L., in which the total content of delta-9-tetrahydrocannabidiol and tetrahydrocannabinolic acid (delta-9-THC-2-carboxylic acid) in the floral or fructifying tops of the plants, from which resins has not been removed, does not exceed 0.20% of the dry-extract content" is prohibited in Poland.

Mexico

On June 19, 2017, Mexico enacted certain amendments to the General Health Law of Mexico, allowing the use of cannabis and its derivatives for medicinal purposes that could be commercialized and prescribed by any licensed physician and sold in pharmacies, as long as the products contain less than 1% THC, as well as for the sale of other products with broad industrial uses as long as a cumulative dose of 1% THC is not exceeded. On August 14, 2019, Mexico’s Supreme Court of Justice resolved an amparo trial setting forth an obligation for the Ministry of Health to regulate the medical and therapeutic use of cannabis and its derivatives, to guarantee the human right to health to the public at large. A Bill was presented in Congress by the United Commissions of Justice, Health, and Legislative Studies of the Senate, to enact the Federal Law for the Regulation of Cannabis and the amendments to certain provisions set forth in the General Health Law and the Criminal Code (the “ Bill ”). On January 12, 2021, the Regulation of the General Health Law on sanitary control for the production, research and medicinal use of cannabis and its pharmacological derivatives was published in the Federal Official Gazette (the "Mexico Regulation"). The Mexico Regulation provides for the primary production for the supply and production of seed, research for health and pharmacology, manufacture of pharmacological derivatives and medicines, and the medicinal use of cannabis. However, it disregards whether to allow foreign investment or limit the percentage of its investment, the exclusivity of licenses and authorizations, nor does it limit the number of licenses that can be obtained per company or establishment, for one or all the regulated activities. The Mexico Regulation became effective on January 13, 2021. Finally, on March 10, 2021, the Chamber of Deputies approved the general terms of the Bill, which was returned to the Senate to discuss certain amendments proposed by the Chamber of Deputies. The Bill regulates the following uses of cannabis and its derivatives: personal, commercialization for recreational purposes, scientific and/or research, and hemp production for industrial uses. The National Commission against Addictions and the Agriculture and Rural Development Ministry

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will be the governmental entities responsible for granting the licenses and permits required to carry out the activities regulated thereby. The Bill distinguishes between the following types of cannabis: a) psychoactive cannabis, containing THC (tetrahydrocannabinol) on a concentration that amounts to or more than 1% THC, and b) hemp or no-psychoactive cannabis, which does not produce a psychoactive effect and it contains a concentration that amounts to or less than 1% THC. The Bill does not limit the percentage of foreign investment for Mexican corporations eligible to request any license. In addition, it does not prohibit the use of “neutral investment”, as allowed in the Foreign Investments Law. A further analysis on this issue will be needed as the proposed legal framework for cannabis and future regulations evolves. As of this date the Bill has not been enacted.

United States

“Marihuana” is a Schedule I controlled substance under the United States Controlled Substances Act of 1970. On December 20, 2018, hemp (defined as the plant cannabis sativa L. and its derivatives, extracts and cannabinoids with THC content of not more than 0.3% on a dry weight basis) was removed from Schedule 1 of the list of controlled substances under United States federal law in accordance with the United States Agriculture Improvement Act of 2018, commonly known as the “2018 Farm Bill”. The 2018 Farm Bill does not affect any other cannabis product and therefore cannabis and cannabis derivatives that do not meet the definition of hemp, and activities involving them, remain illegal under United States federal law. On October 29, 2019, the United States Department of Agriculture (the “ USDA ”) released an interim final rule for regulations governing hemp production in the United States which will be superseded by a final rule that was published January 19, 2021, and will become effective March 22, 2021. The Farm Bill also authorizes individual states and Indian Tribes to regulate hemp in their jurisdiction by developing and seeking USDA approval of a regulatory plan. Notwithstanding the 2018 Farm Bill, the U.S. FDA prohibits cannabis (including hemp) and its derivatives, including cannabidiol (CBD), for use as an ingredient in food and drink. The U.S. FDA held a public hearing on May 31, 2019, to obtain input from stakeholders regarding the regulation of products containing cannabis and cannabis derivatives. On March 11, 2020, the U.S. FDA extended indefinitely the comment period for that hearing. In addition, any ingredient derived from hemp in food is subject to the premarket approval requirements applicable to food additives, unless that use is “generally recognized as safe” (“ GRAS ”). The U.S. FDA has issued letters of no objection to at least three GRAS notices for ingredients derived from hemp seed that contain trace amounts of THC and CBD but has not to date addressed whether hemp-derived THC, CBD or other cannabinoids in non-trace levels are GRAS.

The U.S. federal budget, as currently in effect, includes the Rohrabacher-Farr Amendment, which prohibits the funding of federal prosecutions with respect to medical cannabis activities that are legal under state law. There can be no assurances that the Rohrabacher- Farr Amendment will be included in future appropriations bills or budget resolutions. At this time, there is still very little clarity as to how President Joseph Biden, or Attorney General Merrick Garland, will enforce federal law or how they will deal with states that have legalized medical or recreational marijuana. While bipartisan support is gaining traction on decriminalization and reform (for example, the Marijuana Opportunity Reinvestment and Expungement Act, which, if enacted into law, would decriminalize and regulate cannabis on a federal level in the United States, was passed by the United States House of Representatives on April 1, 2022), there is no imminent timeline on any potential legislation. There is no guarantee that the current Presidential administration, or any future administration, will not change its stated policy regarding the low-priority enforcement of U.S. federal laws that conflict with State laws. There is no guarantee that state laws legalizing and regulating the sale and use of cannabis will not be repealed, amended or overturned, or that local governmental authorities will not limit the applicability of state laws within their respective jurisdictions.

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Germany

In March 2017, the German legislature introduced “The Cannabis as Medicine Act” (Gesetz zur Änderung betäubungsmittelrechtlicher und anderer Vorschriften) which regulates the requirements for the marketability of cannabis pharmaceuticals and their inclusion in health insurance plans. Under this Act, statutory insured patients suffering from a severe disease (i.e. life-threatening or seriously affecting quality of life) are entitled to treatment with medicinal cannabis (flowers or extracts in standardized quality) if (i) generally recognized treatment in accordance with medical standards is either not available, or cannot be applied in individual cases according to the justified assessment of the treating physician, and (ii) if there is a not entirely distant prospect of a noticeable positive effect on the course of the disease or on serious symptoms.

Importers of cannabis pharmaceuticals which have not been produced in an EU/EFTA Member State and which shall be distributed in Germany on a commercial or professional basis must apply for an import authorization to the competent health authority in the federal state (Bundesland) in which the importer is based pursuant to section 72 Medicinal Products Act (Arzneimittelgesetz –" AMG "). Generally, the import authorization can be issued for cannabis from cultivations controlled by the country of origin pursuant to the requirements of the 1961 UN Single Convention on Narcotic Drugs. Additionally, importers must apply for a manufacturing authorization pursuant to section 13 AMG if they carry out at least one manufacturing step within the meaning of section 4 (14) AMG (e.g. preparing, formulating, treating or processing, filling, decanting, packaging, labelling) after import. Furthermore, the distribution of drug products treated with radiation (e.g. E-Beam) requires a permit under the German Regulation on Drug Products treated with Radiation (Verordnung über radioaktive oder mit ionisierenden Strahlen behandelte Arzneimittel – "AMRadV").

The marketing of medicinal cannabis products that qualify as finished medicinal products requires a marketing authorization issued by the competent Federal Institute for Drugs and Medical Devices (Bundesinstitut für Arzneitmittel und Medizinprodukte – “BfArM”).

Pursuant to sec. 72a AMG, importers of medicinal cannabis must ensure that their products have been produced in compliance with applicable quality standards and must obtain a written confirmation from a competent authority to prove compliance. In particular, cannabis medicinal products must be manufactured in compliance with the manufacturing standards of the Pharmaceuticals and Active Agent Manufacturing Ordinance (Arzneitmittel- und Wirkstoffherstellungsverordnung – "AMWHV") which implements the EU Good Manufacturing Practice (“EU GMP”). In addition to standards for the growing and cultivation of the cannabis plant itself, such as the Good Agricultural and Collection Practice (GACP), which is annexed to the EU-GMP, specific pharmaceutical quality standards must be met before placing the product on the market. Such standards are established by pharmaceutical monographs (e.g. “Cannabis Flowers”, “Cannabis Extract”), which are published by the BfArM in the German Pharmacopoeia (Deutsches Arzneibuch – "DAB").

Finally, medicinal cannabis products with a THC concentration of at least 0.2 percent qualify as narcotics under German law and are therefore subject to the authorization requirements under the German Narcotic Drugs Act (Betäubungsmittelgesetz –"BtMG"). Under this Act, the seller, buyer and other processors (e.g. importers, distributors, etc.) of medicinal cannabis products must obtain an authorization by the BfArM. Such an authorization has been issued per se for qualified doctors and pharmacists who sell or buy narcotics for the treatment of a patient or in the course of the operation of a pharmacy. Although CBD as such is not subject to the BtMG unless the possible THC traces exceed 0.2 percent, it is currently unclear whether products containing CBD will be classified and marketed as industrial hemp products or food rather than narcotic drugs following a judgment from the Court of Justice of the European Union on

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November 19, 2020 and the European Commission’s ongoing review of applications for approval of products containing CBD as novel foods. In its ruling of March 24, 2021, the German Federal Court of Justice (Bundesgerichtshof - “BGH”) ruled that the sale of hemp flowers and leaves to end-consumers may qualify as a narcotic but is not necessarily prohibited under the BtMG, provided that these products serve exclusively commercial or scientific purposes without intent to cause intoxication.

Australia

Cannabis and cannabis-related activities are highly regulated in Australia. The cultivation, production, manufacture, import and export, distribution, possession, use and supply of cannabis and cannabis-derived products are regulated by a number of Australian federal, state and territory laws, that include: (a) Criminal Code 1995 (Cth) and separate state and territory crime, drug misuse and/or drug/poison control legislation generally make it illegal to traffic, import, export, manufacture, cultivate or possess cannabis or cannabis products for purposes other than therapeutic use; (b) Narcotics Drugs Act 1967 (Cth) (“ Narcotic Act ”) which permits, in certain circumstances, the cultivation and production of cannabis and the manufacture of products comprising or derived from cannabis or its constituent parts for therapeutic use (“Medicinal Cannabis Products”); (c) Commonwealth Standard for the Uniform Scheduling of Medicines and Poisons (“ Poisons Standard ”) and corresponding state and territory poisons legislation which permit the possession, use and supply of Medicinal Cannabis Products; (d) Customs Act 1901 (Cth) which regulates the import and export of narcotic substances generally, and the Customs (Prohibited Imports) Regulations 1956 (Cth) (“Customs Regulations”) and Customs (Prohibited Exports) Regulations 1958 (Cth) which provide a mechanism for the importation and exportation, respectively, of Medicinal Cannabis Products (and some cannabis / cannabis products for scientific purposes), subject to appropriate licence and permits(s); and (e) Therapeutic Goods Act 1989 (Cth) (“ TG Act ”), Therapeutic Goods Regulations 1990 (Cth) and other subordinate legislation and guidelines, and complementary state and territory legislation, which regulate the quality, safety and efficacy of Medicinal Cannabis Products, as well as the promotion of such products in Australia.

Pursuant to regulation 5 of the Customs Regulations, cannabis (including extracts and tinctures of cannabis), cannabis resin, and cannabinoids, and products containing such ingredients, cannot be imported into Australia without a licence or permit unless the product has been approved for import by legislative instrument under regulation 5(3) of the Customs Regulations. A licence will only be granted where possession and supply are lawfully permitted in the place where the products will be imported, and evidence of this must be provided (e.g. a copy of a supply / wholesale supply licence or Special Access Scheme authorisation form). In light of this, generally, the only cannabis-based products that are currently permitted to be imported into Australia, subject to the licensing requirements discussed below, are Medicinal Cannabis Products (which include cannabis ingredients used to manufacture medicinal cannabis products).

In particular, in order to import Medicinal Cannabis Products into Australia, the importer must hold: (a) a licence to import to import narcotic, psychotropic and precursor substances (for the purposes of this paragraph, a “ Licence ”); and (b) a permission to import each consignment of each specific product (for the purposes of this paragraph, a “ Permit ”), and must comply with any conditions of the Licence and Permit.

Pursuant to section 4 of the Narcotic Act, a Medicinal Cannabis Product means a product, including but not limited to a substance, composition, preparation or mixture, that: (a) includes, or is from, any part of the cannabis plant; and (b) is for use for the purposes of curing, or alleviating the symptoms of, a disease, ailment or injury. The regulatory framework established by the Narcotics Act for the cultivation, production and manufacture of Medicinal Cannabis Products is administered by the Office of Drug Control, being a branch of the Australian Department of Health.

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The regulatory framework established by the TG Act for the minimum standards of safety, quality and efficacy of Medicinal Cannabis Products is administered by the Therapeutic Goods Administration (“ TGA ”), being another branch of the Australian Department of Health. Generally speaking, the TG Act prohibits the supply of therapeutic goods, including Medicinal Cannabis Products, in Australia unless those goods are entered in the Australian Register of Therapeutic Goods (“ARTG”), or an exemption or exception applies. In order for a product to be entered in the ARTG, the sponsor of the product must submit an application to the TGA which includes data as to the quality, safety, efficacy and performance of the product and its intended use, and which will be rigorously assessed by the TGA.

Alternatively, the following exceptions and exceptions apply to some Medicinal Cannabis Products:

(a) under the TGA’s Special Access Scheme (“ SAS ”) a medical practitioner may use one of the following two SAS Categories to access an unapproved Medicinal Cannabis Product for an individual patient:

(i) SAS Category A: a prescribing medical practitioner (a medical doctor) or a health practitioner on behalf of a prescribing medical practitioner (e.g. a nurse practitioner or pharmacist) may, with notification to the TGA, supply unapproved medicinal cannabis products to a “Category A patient”, being a person who is seriously ill with a condition from which death is reasonably likely to occur within a matter of months, or from which premature death is reasonably likely to occur in the absence of early treatment; or

(ii) SAS Category B: if a patient is not a “Category A patient”, a health practitioner may nevertheless make an application to the TGA for approval to supply unapproved medicinal cannabis products to the patient (which requires a thorough clinical justification for the use of the product, including the seriousness of the condition, details of previous treatment and reasons why a currently approved therapeutic good cannot be used for the treatment of the individual patient in the particular circumstance); or

(b) under the TGA’s Authorised Prescriber Scheme a medical practitioner may apply to the TGA to become an “Authorised Prescriber” of a Medicinal Cannabis Product which is not entered in the ARTG so that the medical practitioner may prescribe the product to a class (or classes) of patients with a particular medical condition; or

(c) Medicinal Cannabis Products may be supplied to participants of a clinical trial authorised to be conducted in Australia under the TGA’s Clinical Trial Notification or Clinical Trial Approval Scheme.

Depending on the Australian state(s) and/or Territory(ies) in which the importer of a Medicinal Cannabis Products seeks to import, store and supply the product: (a) the importer or distributor of the product(s) (as applicable) may need to obtain a relevant supply / wholesale supply licence from the relevant State or Territory health department(s); and (b) the medical practitioner(s) who will prescribe the product(s) to patients may need to obtain an individual prescribing approval or authorisation from the relevant State or Territory health department(s).

In this regard, since April 2018, a ‘single-in’ application process has been developed through which practitioners can notify or apply to both the TGA and the relevant State’s or Territory’s Department of Health (where applicable) to prescribe and supply medicinal cannabis products.

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South Africa

The legislative framework which regulates cannabis and cannabis related products in South Africa primarily comprises the Drugs and Drug Trafficking Act No. 140 of 1992 and the Medicines and Related Substances Act No. 101 of 1965 (“ South Africa Medicines Act ”). The South Africa Medicines Act regulates, inter alia, medicines and scheduled substances. The South Africa Medicines Act defines a “medicine” as follows: “(a) any substance or mixture of substances used or purporting to be suitable for use or manufactured or sold for use in (i) the diagnosis, treatment, mitigation, modification or prevention of disease, abnormal physical or mental state or the symptoms thereof in humans; or (ii) restoring, correcting or modifying any somatic or psychic or organic function in humans, and (b) includes any veterinary medicine”. A “scheduled substance” is defined by the South Africa Medicines Act as “any medicine or other substance prescribed by the Minister [of Health] under section 22A [of the South Africa Medicines Act]” and therefore includes both medicines and non-medicines listed in the schedules to the South Africa Medicines Act.

CBD is listed in the Schedules to the South Africa Medicines Act as a Schedule 4 substance (subject to certain exceptions). In terms of section 22C of the South Africa Medicines Act, no manufacturer, wholesaler or distributor shall manufacture, act as a wholesaler of or distribute, as the case may be, Scheduled substance unless he or she is the holder of the appropriate licence contemplated in the said subsection. issued by the SAHPRA in terms of section 22C(1)(b) of the South Africa Medicines Act. Section 22C(1)(b) provides that the manufacturers, wholesalers and distributors may apply to SAHPRA for the relevant licence.

Schedule 4 substances may only be sold by certain persons, including (i) a pharmacist, pharmacist intern or a pharmacist’s assistant acting under the personal supervision of a pharmacist, who may only sell Schedule 4 substances upon a written prescription issued by an authorised prescriber or on the verbal instructions of an authorised prescriber who is known to such pharmacist; (ii) manufacturers of or wholesale dealers in pharmaceutical products, which may only sell Schedule 4 substances to a person who may lawfully possess such substances; (iii) medical practitioners and dentists who may prescribe such substances and/or compound or dispense such substances only if he or she is the holder of the relevant licence issued by the Director-General in terms of section 22C(1)(a) of the South Africa Medicines Act (iv) certain other practitioners, nurses and persons who are registered under the Health Professions Act No, 56 of 1974, who may (as authorised by his or her professional council concerned) prescribe only the such substances for purposes identified in Schedule 4 for each substance and/or compound or dispense such substances only if he or she is the holder of the relevant licence issued by the Director-General in terms of section 22C(1)(a) of the South Africa Medicines Act; and (v) veterinarians who may prescribe, compound or dispense such substance.

A Schedule 4 substance may be possessed by a person who is in possession of a prescription issued by an authorised prescriber and may be possessed by pharmacists, medical practitioners, dentists, veterinarians, practitioners, nurses or other persons registered under the Health Professions Act No. 56 1974.

If a Schedule 4 substance is sold for analytical purposes, manufacture of foods, cosmetics, educational or scientific purposes, such substance may only be sold by a pharmacist if a permit has been obtained from the Director-General for such purpose.

The classification of CBD and preparations and mixtures of CBD as Schedule 4 substances is subject to two exceptions. The first exception is in terms of a notice published in GNR586 of Government Gazette 43347 dated 22 May 2020, by the Minister of Health of South Africa on the recommendation of

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SAHPRA, in terms of section 36(1) of the South Africa Medicines Act, which excludes from Schedule 4 all preparations containing CBD that: (a) contain no more than 600mg of CBD per sales pack and a maximum daily dose of 20 mg CBD and make only an accepted low risk claim or health claim which only refers to (i) general health enhancement without any reference to specific diseases, (ii) health maintenance, or (iii) relief of minor symptoms (not related to a disease or disorder); or (b) consist of processed products made from cannabis raw plant material and processed products, where only the naturally occurring cannabinoids found in the source material are contained in the product, and which contain no more than 0,001% THC and not more than 0,0075% total CBD. Subsection (a) also includes a general exception which applies to all Scheduled substances listed in Schedule 4. In this regard, Schedule 4 provides as follows: “All substances referred to in this Schedule are excluded when specifically packed, labelled, sold and used for: industrial purposes including the manufacture or compounding of consumer items or products which have no pharmacological action or medicinal purpose; and analytical laboratory purposes.”

A product containing CBD, which would otherwise be a Schedule 4 substance, is therefore excluded from the requirements in the South Africa Medicines Act relating to Scheduled substances if it: (a) contains no more than 600mg of CBD per sales pack and less than a maximum daily dose of 20 mg of CBD and only makes the permitted low risk claims or health claims as set out above; (b) consists of processed products that contain only the naturally occurring quantity of cannabinoids found in the source material and contain THC and/or CBD that does not exceed the prescribed thresholds as set out above; or (c) is specifically packed, labelled, sold and used for (i) industrial purposes, including the manufacture or compounding of consumer items or products which have no pharmacological action or medicinal purpose; and (ii) analytical laboratory purposes. However, where exceptions (a) and (b) apply, such product will be classified as a Schedule 0 substance and may be regarded as a considered as a "health supplement" for purposes of the South Africa Medicines Act, as defined the General Regulations passed in terms of the Medicines Act and published under Government Notice 859 in Government Gazette 41064 on 25 August 2017 (" the General Regulations "). The term "health supplement" is defined in the General Regulations as, "any substance, extract or mixture of substances as determined by SAHPRA", sold in dosage forms used or purported for use in restoring, correcting or modifying any physical or mental state by … complementing health; … supplementing the diet; or … a nutritional effect, and excludes injectable preparations, medicines or substances listed as Schedule 1 or higher in the [Medicines] Act". Schedule 0 includes the exception that -"All substances referred to in … Schedule [0] are excluded when specifically packed, labelled, sold and used for … industrial purposes including the manufacture or compounding of consumer items or products which have no pharmacological action or medicinal purpose, and which are intended to be ingested by man or animals as a food or applied to the body as a cosmetic, and which are approved for such use in terms of the Foodstuffs [Act] … or that are registered in terms of the Fertilizers, Farm Feeds, Agricultural Remedies and Stock Remedies Act, 1947 (Act 36 of 1947)". Health supplements are classified as complementary medicines in terms of the General Regulations.

At present, no specific implementing regulations are applicable to complementary medicines as the law relating to complementary medicines is currently in a state of flux. SAHPRA may, however, call-up a specific category of complementary medicines (including complementary medicines containing CBD) for registration, in respect of which manufacturers, importers, and distributers of these products will be required to illustrate their respective compliance with the relevant provisions of the South Africa Medicines Act relating to complementary medicines.

Risk Factors

This section discusses factors relating to the business of Company that should be considered by both existing and potential investors. The information in this section is intended to serve as an overview

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and should not be considered comprehensive. The Company may face risks and uncertainties not discussed in this section, or not currently known to us, or that we consider to be immaterial. All risks to the Company’s business have the potential to influence its operations in a materially adverse manner.

The Ongoing Impact of COVID-19

The novel coronavirus commonly referred to as "COVID-19" was identified in December 2019 in Wuhan, China. On January 30, 2020, the World Health Organization declared the outbreak a global health emergency, and on March 11, 2020, the spread of COVID-19 was declared a pandemic by the World Health Organization. The outbreak has spread throughout Europe, the Middle East and North America, causing companies and various international jurisdictions to impose restrictions such as quarantines, business closures and travel restrictions. While these effects are expected to be temporary, the duration of the business disruptions internationally and related financial impact cannot be reasonably estimated at this time. The rapid development of the COVID-19 pandemic and the measures being taken by governments and private parties to respond to it are extremely fluid. While the Company has continuously sought to assess the potential impact of the pandemic on its financial and operating results, any assessment is subject to extreme uncertainty as to probably, severity and duration.

The development and operation of the Company’s business is dependent on labour inputs which could be adversely disrupted by the ongoing impact of COVID-19. While it is difficult to predict the impact of COVID-19 on the Company’s business, measures taken by the Canadian and Ontario governments and voluntary measures undertaken by the Company with a view to the safety of the Company’s employees, may adversely impact the Company’s business, for instance by impeding the labour required to cultivate, process, market and distribute the Company’s products and disrupting the Company’s critical supply chains. In addition, while cannabis retail has been declared an essential service in many provinces, sales volumes of cannabis may be adversely impacted by consumer “social distancing” behaviours. All Company office staff had transitioned to working remotely from home offices, with business continuing to be conducted by telephonic and electronic means. The Company reopened its head office on a voluntary and limited basis for its employees. The Company’s Hamilton Facility, Puslinch Facility and Quebec Facility have implemented precautionary measures to ensure the safety of the staff and product, including limiting visits to the site to essential personnel only, ensuring proper protocols around sanitation, mask usage and physical distancing, and placing potentially exposed employees in self-quarantine for the appropriate period. These measures and similar measures taken by other employers may adversely impact the Company’s ability to successfully market its new key product lines, for instance by precluding in-store visits and budtender engagement programs. In the short term, the Company is seeking to mitigate these impacts through technology-mediated engagement with retailers. The Company continues to dynamically monitor developments in order to adapt and respond in order to protect the health and safety of the Company’s employees and the best interests of the Company, and has now implemented return to work protocols in line with the easing of provincial pandemic restrictions.

Risks Relating to the Company’s Business

The Company’s ability to continue as a going concern.

The Company incurred net losses of $42.297 million in the year ended December 31, 2021 and $183.131 million in the year ended December 31, 2020. As at December 31, 2021, the Company’s cash position was $4.308 million including $0.219 million in restricted cash. The Company’s working capital as at December 31, 2021 was $25.716 million. The Company is obligated to make interest payments and comply with other covenants under its Revolver Loan, but there is a risk it will be unable to make such payments or comply with such covenants, in which case the lender may take steps to enforce its security

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over substantially all of the assets of the Company. Given these financial circumstances, there is uncertainty as to whether the Company will have the ability to continue as a going concern.

The Company’s ability to raise required additional capital through the sale of equity or debt instruments or sale of assets or the factoring of receivables or otherwise.

The Company’s available funds are expected to fund operations until May 2022, at which time the Company will require additional capital to repay its debt obligations that are due and to fund operations. There can be no assurance that such financing may be available or on terms that are acceptable. To date, the Company has relied primarily on the public equity capital markets in Canada in order to raise required capital. There has been a marked cooling off of activity in the Canadian equity capital markets for Canadian Licensed Producers, and the Company’s ability to raise equity capital may be adversely impacted. The market for debt capital has likewise tightened. Together, these factors may adversely impact the Company’s ability to raise debt capital. The Company’s inability to raise such capital could result in the delay or indefinite postponement of its current business objectives or in its inability to continue to carry on its business. Furthermore, there is no assurance that the Company would be able to repay the Revolver Loan or any further loans or prevent the enforcement of security granted pursuant to the Revolver Loan or any other debt financing.

The Company has a limited operating history.

The Company has a limited history of operations and its efforts to grow its business may be more costly than it expects and it may not be able to increase its revenue enough to offset higher operating expenses. As such, the Company is subject to many risks common to such enterprises, including undercapitalization, cash shortages, limitations with respect to personnel, financial and other resources and limited revenues. There is no assurance that the Company will be successful in achieving a return on shareholders’ investment and the likelihood of the Company’s success must be considered in light of its early stage of operations.

The Company may incur significant losses in the future for a number of reasons, including as a result of unforeseen expenses, difficulties, complications and delays, the other risks described in this Annual Information Form and other unknown events. The amount of future net losses will depend, in part, on the growth of its future expenses and its ability to generate revenue. Because of the numerous risks and uncertainties associated with producing cannabis and cannabis-derived products, the Company is unable to accurately predict when, or if, it will be able to achieve profitability. Even if it achieves profitability in the future, it may not be able to sustain profitability in subsequent periods. If the Company is unable to achieve and sustain profitability, the market price of its Common Shares may significantly decrease and its ability to raise capital, expand its business or continue its operations may be impaired.

The Company may be unable to achieve revenue growth and development.

The Company is an early stage company attempting to grow its business. The Company’s ability to grow will depend on a number of factors, many of which are beyond its control, including, but not limited to, the availability of sufficient capital on suitable terms, changes in laws and regulations respecting the production of cannabis products, competition from other entities licenced under the Cannabis Act, its ability to recruit and retain sufficient experienced personnel and its ability to manage complex international operations. In addition, the Company is subject to a variety of business risks generally associated with developing companies. Future development and expansion could place significant strain on the Company’s management personnel and likely will require the Company to recruit additional management personnel, and there is no assurance that it will be able to do so. As its operations grow in size, scope and complexity

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and as it identifies and pursues new opportunities, the Company may need to increase in scale its infrastructure (financial, management, informational, personnel and otherwise).

In addition, the Company will need to effectively execute on business opportunities and continue to build on and deploy its corporate development and marketing assets as well as access sufficient new capital, as may be required. The ability to successfully complete acquisitions and to capitalize on other growth opportunities may redirect its limited resources and require expansion of its infrastructure. This will require the Company to commit financial, operational and technical resources in advance of an increase in the volume of business, with no assurance that the volume of business will increase. There can be no assurance the Company will be able to respond adequately or quickly enough to the changing demands that material expansion will impose on management, team members and existing infrastructure, and changes to its operating structure may result in increased costs or inefficiencies that it cannot anticipate. Changes as the Company grows may have a negative impact on its operations, and cost increases resulting from its inability to effectively manage its growth could adversely impact its profitability. In addition, continued growth could also strain the Company’s ability to maintain reliable service levels for its clients, develop and approve its operational, financial and management controls, enhance its reporting systems and procedures and recruit, train and retain highly-skilled personnel.

Failure to effectively manage growth could result in difficulty or delays in servicing clients, declines in quality or client satisfaction, increases in costs, difficulties in introducing new products or applications or other operational difficulties, and any of these difficulties could adversely impact the Company’s business performance and results of operations. There can be no assurance that the Company will effectively be able to manage its expanding operations, including any acquisitions, that its growth will result in profit, that it will be able to attract and retain sufficient management personnel necessary for growth or that it will be able to successfully make strategic investments or acquisitions.

There are factors which may prevent the Company from the realization of growth targets.

There is a risk that the Company’s resources will not be developed on time, on budget, or at all, as development can be adversely affected by a variety of factors, including some that are discussed elsewhere in these “Risk Factors” and the following:

• delays in obtaining, or conditions imposed by, regulatory approvals;

• facility design errors;

• environmental pollution; non-performance by third party contractors; increases in materials or labour costs; construction performance falling below expected levels of output or efficiency;

• breakdown, aging or failure of equipment or processes;

• contractor or operator errors;

• operational inefficiencies;

• labour disputes, disruptions or declines in productivity; inability to attract sufficient numbers of qualified workers; disruption in the supply of energy and utilities; and

• major incidents and/or catastrophic events such as fires, explosions, storms, or physical attacks.

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The Company’s actual financial position and results of operations may differ materially from the expectations of the Company’s management.

In the past, the Company has experienced changes in its operating plans and delays in its plans. If this were to occur again in the future, the Company’s revenue, net income and cash flow may differ materially from the Company’s projected revenue, net income and cash flow. The process for estimating the Company’s revenue, net income and cash flow requires the use of judgment in determining the appropriate assumptions and estimates. These estimates and assumptions may be revised as additional information becomes available and as additional analyses are performed. In addition, the assumptions used in planning may not prove to be accurate, and other factors may affect the Company’s financial condition or results of operations.

The Company may incur significant ongoing costs and obligations related to its investment in infrastructure, growth, regulatory compliance and operations.

The Company may incur significant ongoing costs and obligations related to its investment in infrastructure and growth and for regulatory compliance, which could have a material adverse impact on the Company’s results of operations, financial condition and cash flows. In addition, future changes in regulations, more vigorous enforcement thereof or other unanticipated events could require extensive changes to the Company’s operations, increased compliance costs or give rise to material liabilities, which could have a material adverse effect on the business, results of operations and financial condition of the Company. The Company’s efforts to grow its business may be costlier than expected, and it may not be able to increase its revenue enough to offset its higher operating expenses. The Company may incur significant losses in the future for a number of reasons, including the other risks described in this Annual Information Form, and unforeseen expenses, difficulties, complications and delays, and other unknown events. If the Company is unable to achieve and sustain profitability, the market price of the Common Shares may significantly decrease.

There is no assurance that the Company will turn a profit.

There is no assurance as to whether the Company will be profitable, earn revenues, or pay dividends. The Company has incurred and anticipates that it will continue to incur substantial expenses relating to the development and initial operations of its business. The payment and amount of any future dividends will depend upon, among other things, the Company’s results of operations, cash flow, financial condition, and operating and capital requirements. There is no assurance that future dividends will be paid, and, if dividends are paid, there is no assurance with respect to the amount of any such dividends.

The Company’s management has broad discretion concerning the use of net proceeds of the ATM program.

The net proceeds from the Company’s ATM program will be used for general corporate purposes, working capital needs, including the repayment of indebtedness, and capital expenditures. Accordingly, the Company’s management will have broad discretion concerning the use of the net proceeds of the ATM program as well as the timing of their expenditures, and there can be no assurance as to how the funds will be allocated. The failure by the Company’s management to apply these funds effectively could result in financial losses that could have a material adverse effect on the Company’s business and cause the price of the Common Shares to decline. Pending their use, the Company may invest the net proceeds from the ATM program in a manner that does not produce income or that loses value.

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The Company is subject to risks typically associated with secured debt financing.

In relation to the Revolver Loan, the Company continues to be subject to risks typically associated with secured debt financing. The Company's cash flows could be insufficient to satisfy required payments of principal and interest under the Revolver Loan..

The Company's ability to make scheduled payments of principal and interest on the Revolver Loan depends on its future cash flow, which is subject to the financial performance of the Company's business, prevailing economic conditions, prevailing interest rate levels, and other financial, competitive and operational factors, many of which are beyond the Company's control.

The covenants under the Revolver Loan limit the Company’s ability to engage in activities that may be in the Company’s long-term best interest. In addition, the terms and conditions thereof contain financial, operational and reporting covenants, and compliance with the covenants by the Company may increase the Company’s legal and financial costs, make certain activities more difficult or restricted, timeconsuming or costly and increase demand on the Company’s systems and resources. The Company’s failure to comply with any such covenants could result in an event of default which could result in the acceleration of repayment of the Company’s debt or realization of the security granted.

The Company may incur additional indebtedness.

The Company may finance future activities wholly or partially with debt, which may increase the Company’s debt levels above industry standards. Any debt financing secured in the future could involve restrictive covenants relating to capital raising activities and other financial and operational matters, which may make it more difficult for the Company to obtain additional capital and to pursue business opportunities, including potential acquisitions.

The adult-use cannabis market in Canada is a relatively new industry.

As a Licensed Producer under the Cannabis Act, the Company is operating in a relatively new industry and market. In addition to being subject to general business risks, the Company must continue to build brand awareness in this industry and market share through significant investments in its strategy, production capacity, quality assurance and compliance with regulations. In addition, there is no assurance that the industry and market will continue to exist and grow as currently estimated or anticipated or function and evolve in the manner consistent with management’s expectations and assumptions. Any event or circumstance that adversely affects the cannabis industry, such as the imposition of further restrictions on sales and marketing or further restrictions on sales in certain areas and markets could have a material adverse effect on the Company’s business financial conditions and results of operations.

Although the Company is committed to researching and developing new markets and products and improving existing products, there can be no assurances that such research and market development activities will prove profitable or that the resulting markets and/or products, if any, will be commercially viable or successfully produced and marketed. The Company must rely largely on its own market research to forecast sales as reliable forecasts are not generally obtainable from other sources at this early stage of the cannabis industry domestically in Canada and in other international jurisdictions.

The adult-use cannabis market in Canada may experience supply and demand fluctuations that could result in revenue and price decreases.

Since the legalization of cannabis, there have been periods of significant over- and under- supply in the Canadian adult-use market. In addition, demand for cannabis products is dependent on a number of

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social, political and economic factors that are beyond the Company’s control. The initial demand that has been experienced following legalization may not continue at comparable levels or may not be sustainable as a portion of such demand may have been a result of the novelty of legalization. As a result, the available supply of cannabis could exceed demand, resulting in a significant decline in the market price for cannabis. Conversely, the Company may be unable to meet demand levels. If supply/demand imbalances occur and persist, the Company may be unable to generate sufficient revenue from the sale of adult-use cannabis to be profitable.

The Company’s business is dependent on key supply chains which could be adversely disrupted by a number of factors including, among others, major health issues or pandemics.

The Company and its suppliers may be affected by, among other things, disruptions related to major health issues or pandemics, increases in labor and fuel costs, labor disputes and disruptions, regulatory changes, political or economic instability or civil unrest, natural disasters, trade restrictions, tariffs, transport capacity and costs and other factors relating to trade. In particular, major health issues and pandemics, such as the global impact of the coronavirus, have and may impact commerce and travel and may adversely affect trade and global and local economies. Given the ongoing and dynamic nature of the circumstances, it is difficult to predict the impact of the coronavirus outbreak on the Company’s business. These factors that are beyond the Company’s control, may adversely affect the Company and its suppliers or cause disruptions to their and the Company’s businesses and may impact their ability to supply to the Company.

The Company is reliant on regulatory approvals and cultivation licences for its ability to grow, process, package, store and sell cannabis and other products derived therefrom, and these regulatory approvals are subject to ongoing compliance requirements, reporting obligations and fixed terms requiring renewal.

The Company is dependent upon its licences for its ability to grow, store and sell cannabis and other permitted products derived therefrom and the licences are subject to ongoing compliance, reporting requirements and renewal. See “ Material Contracts ”.

The licences are subject to ongoing compliance, reporting requirements and renewal. Although the Company believes it will meet the requirements of the Cannabis Act for future renewals of its licences, there can be no guarantee that Health Canada will renew the licences or, if renewed, renewed on the same or similar terms or that Health Canada will not revoke the licences. Should the Company fail to comply with the requirements of the licences or should Health Canada not renew the licences when required, or renew the licences on different terms or revoke the licences, there would be a material adverse effect on the Company’s business, financial condition and results of operations.

Other government licences are currently, and in the future may be, required in connection with the Company’s operations, in addition to other unknown permits and approvals which may be required. To the extent such permits and approvals are required and not obtained, the Company may be prevented from operating and/or expanding its business, which could have a material adverse effect on the Company’s business, financial condition and results of operations. Moreover, there is no assurance of new licences or approvals from Health Canada or any other regulatory authority.

Prior to the expiry of any licence, the Company must submit to Health Canada an application for renewal containing information prescribed by the Cannabis Act. Failure to comply with the requirements of the licences or any failure to renew the licences would have a material adverse impact on the business, financial condition, results of operations and prospects of the Company. There can be no guarantee that Health Canada will renew the Company’s licences, or that such renewals will occur in a timely fashion or on terms similar to the Company’s existing licences or otherwise acceptable to the Company and its

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business. Should Health Canada not renew or amend the Company’s licences, delay the renewal or amendment of its licences or renew or amend licences on different terms, the expectations of management with respect to the increased future cultivation and growing capacity may not be borne out and the business, financial condition, results of operations and prospects of the Company could be materially adversely affected.

The Company cannot predict the time required to secure all appropriate regulatory approvals for its products, or the extent of testing and documentation that may be required by governmental authorities. Any delays in obtaining, or failure to obtain the necessary regulatory approvals will significantly delay the development of the Company’s markets and products and could have a material adverse effect on the business, results of operations and financial condition of the Company.

Any failure on the Company’s part to comply with applicable regulations could prevent it from being able to carry on its business and there may be additional costs associated with any such failure.

The Company’s business activities are heavily regulated in all jurisdictions where it carries on business. Its operations are subject to various laws, regulations and guidelines by governmental authorities (including Health Canada) relating to the cultivation, processing, manufacture, marketing, management, distribution, transportation, storage, sale, packaging, labelling, pricing and disposal of cannabis and hemp products, and also including laws and regulations relating to health and safety, insurance coverage, the conduct of operations and the protection of the environment. Laws and regulations, applied generally, grant government agencies and self-regulatory bodies broad administrative discretion over the Company’s activities, including the power to limit or restrict business activities as well as impose additional disclosure requirements on its products and services.

Health Canada inspectors routinely assess the Company’s facilities for compliance with applicable regulatory requirements. Furthermore, the import and export of its products from and into any jurisdiction is subject to the regulatory requirements of each such jurisdiction. Any failure by the Company to comply with the applicable regulatory requirements could require extensive changes to its operations; result in regulatory or agency proceedings or investigations, increased compliance costs, damage awards, civil or criminal fines or penalties or restrictions on its operations; harm its reputation or give rise to material liabilities or a revocation of its licences and other permits. There can be no assurance that any pending or future regulatory or agency proceedings, investigations or audits will not result in substantial costs, a diversion of management’s attention and resources or other adverse consequences to the Company and its business.

Achievement of the Company’s business objectives is contingent, in part, upon compliance with regulatory requirements enacted by governmental authorities and obtaining all necessary regulatory approvals for the cultivation, processing, production, storage, distribution, transportation, sale, import and export, as applicable, of its products. Any failure to comply with the regulatory requirements applicable to its operations may lead to possible sanctions including the revocation or imposition of additional conditions on licences to operate its business; the suspension or expulsion from a particular market or jurisdiction or of its key personnel; the imposition of additional or more stringent inspection, testing and reporting requirements; and the imposition of fines and censures. In addition, changes in regulations, government or judicial interpretation of regulations, or more vigorous enforcement thereof or other unanticipated events could require extensive changes to the Company’s operations, increase compliance costs or give rise to material liabilities or a revocation of its licences and other permits, which could have a material adverse effect on its business, results of operations and financial condition. Furthermore, governmental authorities may change their administration, application or enforcement procedures at any time, which may adversely impact the Company’s ongoing costs relating to regulatory compliance.

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Under Canadian regulations, a Licensed Producer of cannabis is restricted regarding the type and form of marketing it can undertake which could materially impact sales performance.

The development of the Company’s business and operating results may be hindered by applicable restrictions on production, sales and marketing activities imposed on the Company and other entities licensed under the Cannabis Act by Health Canada and the Cannabis Act. All products distributed by the Company into the Canadian adult-use market need to comply with requirements under Canadian legislation, including with respect to product formats, product packaging and labelling, and marketing activities around such products. Among other restrictions, the Cannabis Act prohibits testimonials and endorsements, lifestyle branding, and promotion that is appealing to young persons. As such, the Company’s portfolio of brands and products must be specifically adapted, and its marketing activities carefully structured, to enable the Company to develop its brands in an effective and compliant manner. If the Company is unable to effectively market its cannabis products and compete for market share, or if the costs of compliance with government legislation and regulation cannot be absorbed through increased selling prices for its cannabis products, then the Company’s sales and operating results could be adversely affected.

The Company’s industry is experiencing substantial change and consolidation that may cause the Company to lose key relationships and intensify competition.

The cannabis industry is undergoing substantial change, which has resulted in an increase in competitors, consolidation and formation of strategic relationships. Such acquisitions or other consolidating transactions could harm the Company in a number of ways, including by losing strategic partners if they are acquired by or enter into relationships with a competitor, losing customers, revenue and market share, or forcing the Company to expend greater resources to meet new or additional competitive threats, all of which could harm the Company’s operating results. As competitors enter the market and become increasingly sophisticated, competition in the Company’s industry may intensify and place downward pressure on retail prices for products and services, which could negatively impact profitability.

The Company may be unsuccessful in competing in the overall legal adult-use cannabis market in Canada and any other countries it intends to operate in.

The Company’s Canadian adult-use business faces enhanced competition from other individuals and corporations who are licensed under the Cannabis Act to participate in the adult-use cannabis industry. The Cannabis Act has established a licensing regime for the production, testing, packaging, labeling, delivery, transportation, distribution, sale, possession and disposal of cannabis for adult use. While, pursuant to transitional provisions in the Cannabis Regulations, existing holders of licences relating to medical cannabis under the former ACMPR have, subject to satisfying certain requirements, automatically been deemed licenced under the Cannabis Act for corresponding activities, other individuals and corporations are now able to apply for such licences.

Subject to certain restrictions set out in the Cannabis Act, the Cannabis Act allows adults to cultivate, propagate, harvest and distribute up to four cannabis plants per household, provided that each plant meets certain requirements. If the Company is unable to effectively compete with other suppliers to the adult-use cannabis market, or a significant number of individuals take advantage of the ability to cultivate and use their own cannabis, the Company’s success in the adult-use business may be limited and may not fulfill the expectations of management.

The Company will also face competition from existing entities licensed under the Cannabis Act. Certain of these competitors have significantly greater financial, production, marketing, research and development and technical and human resources than the Company does. As a result, the Company’s competitors may be more successful in gaining market penetration and market share. The Company’s

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commercial opportunity in the adult-use market could be reduced or eliminated if its competitors produce and commercialize products for the adult-use market that, among other things, are safer, more effective, more convenient or less expensive than the products that it may produce, have greater sales, marketing and distribution support than the Company’s products, enjoy enhanced timing of market introduction and perceived effectiveness advantages over the Company’s products and receive more favorable publicity than the Company’s products. If the Company’s adult-use products do not achieve an adequate level of acceptance by the adult-use market, it may not generate sufficient revenue from these products, and its adult-use business may not become profitable.

If the number of users of cannabis in Canada increases, the demand for products will increase and the Company expects that competition will become more intense, as current and future competitors begin to offer an increasing number of diversified products. To remain competitive, the Company will require a continued high level of investment in research and development, marketing, sales and client support. The Company may not have sufficient resources to maintain research and development, marketing, sales and client support efforts on a competitive basis which could materially and adversely affect its business, financial condition and results of operations.

The Company also faces competition from illegal cannabis dispensaries that are selling cannabis to individuals, despite not having a valid licence under the Cannabis Regulations.

In addition, the legal landscape for medical and recreational cannabis is rapidly changing internationally. An increasing number of jurisdictions globally are passing legislation allowing for the production and distribution of medical and/or recreational cannabis in some form or another. Entry into the cannabis market by international competitors might lower the demand for the Company’s products on a global scale.

If the Company is unable to attract and retain key personnel, it may not be able to compete effectively in the cannabis market.

The Company’s success has depended and continues to depend upon its ability to attract and retain key management, including the Company’s CEO, technical experts and sales personnel. The Company will attempt to enhance its management and technical expertise by continuing to recruit qualified individuals who possess desired skills and experience in certain targeted areas. The Company’s inability to retain employees and attract and retain sufficient additional employees or engineering and technical support resources could have a material adverse effect on the Company’s business, results of operations, sales, cash flow or financial condition. Shortages in qualified personnel or the loss of key personnel could adversely affect the financial condition of the Company, results of operations of the business and could limit the Company’s ability to develop and market its cannabis-related products. The loss of any of the Company’s senior management or key employees could materially adversely affect the Company’s ability to execute the Company’s business plan and strategy, and the Company may not be able to find adequate replacements on a timely basis, or at all. The Company does not maintain key person life insurance policies on any of its employees.

Further, each director and officer of a company that holds a licence for cultivation, processing or sale under the Cannabis Regulations is subject to the requirement to obtain and maintain a security clearance under the Cannabis Regulations. Certain additional key personnel are also required to obtain and maintain a security clearance. Under the Cannabis Regulations, a security clearance cannot be valid for more than five years and must be renewed before the expiry of a current security clearance. There is no assurance that any of the Company’s existing personnel who presently or may in the future require a security clearance will be able to obtain or renew such clearances or that new personnel who require a security clearance will

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be able to obtain one. A failure by an individual in a key operational position to maintain or renew his or her security clearance could result in a reduction or complete suspension of the Company’s operations.

If an individual in a key operational position leaves the Company, and it is unable to find a suitable replacement who is able to obtain a security clearance required by the Cannabis Act in a timely manner, or at all, the Company may not be able to conduct its operations at planned production volume levels or at all. The Cannabis Regulations require the Company to designate a responsible person (RP) and a qualified person in charge (QPIC) . The RP has overall responsibility for the management of the cannabis activities authorized under the licence. The QPIC must work at the licensed site and is responsible for supervising the authorized cannabis activities and ensuring regulation compliance, and must meet certain educational requirements. If the Company’s current designated RP and QPIC fail to maintain their security clearance, or if its current designated RP and QPIC leave and it is unable to find a suitable replacement who meets these requirements, the Company may no longer be able to conduct activities with respect to cannabis.

The Company, or the cannabis industry more generally, may receive unfavorable publicity or become subject to negative consumer or investor perception.

The Company believes that the cannabis and CBD industries are highly dependent upon positive consumer and investor perception regarding the benefits, safety, efficacy and quality of the cannabis or CBD product distributed to consumers. Such categories of products having previously been commonly associated with various other narcotics, violence and criminal activities, there is a risk that the Company’s business might attract negative publicity. Perception of the cannabis or CBD industry and cannabis or CBD products, currently and in the future, may be significantly influenced by scientific research or findings, regulatory investigations or proceedings, regulatory enforcement activities, litigation, political statements, media attention and other publicity (whether or not accurate or with merit) both in Canada and in other countries relating to the consumption of cannabis or CBD products, including unexpected safety or efficacy concerns arising with respect to cannabis or CBD products or the activities of industry participants.

There can be no assurance that future scientific research, findings, regulatory investigations or proceedings, regulatory enforcement activities, litigation, political statements, media attention or other research findings or publicity will be favorable to the cannabis or CBD markets or any particular cannabis or CBD product or will be consistent with earlier publicity. Adverse future scientific research reports, findings, regulatory investigations or proceedings, and political statements, that are, or litigation, media attention or other publicity that is, perceived as less favorable than, or that questions, earlier research reports, findings or publicity (whether or not accurate or with merit) could result in a significant reduction in the demand for the Company’s cannabis or CBD products. Further, adverse publicity reports or other media attention regarding the safety, efficacy and quality of cannabis and CBD, the Company’s current or future products, the use of cannabis or CBD for medical purposes or associating the consumption of cannabis or CBD with illness or other negative effects or events, could adversely affect the Company. This adverse publicity could arise even if the adverse effects associated with cannabis or CBD products resulted from consumers’ failure to use such products legally, appropriately or as directed.

There is also a risk that the actions of other entities licensed under the Cannabis Act or of companies and service providers in the cannabis or CBD industries may negatively affect the reputation of the industry as a whole and thereby negatively impact the Company’s reputation. The increased usage of social media and other web-based tools used to generate, publish and discuss user-generated content and to connect with other users has made it increasingly easier for individuals and groups to communicate and share negative opinions and views in regards to the Company’s activities and the cannabis and CBD industries in general, whether true or not.

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Although the Company believes that it operates in a manner that is respectful to all stakeholders and that it takes care in protecting its image and reputation, the Company does not ultimately have direct control over how it or the cannabis or CBD industry is perceived by others. Reputational issues may result in decreased investor confidence, increased challenges in developing and maintaining community relations and present an impediment to the Company’s overall ability to advance its projects, thereby having a material adverse impact on financial performance, financial condition, cash flows and growth prospects.

The Company’s products may not have, or may not be perceived to have, the effects intended by the end user.

If the products the Company sells are not perceived to have the effects intended by the end user, its business may suffer. There is little long-term data with respect to efficacy, unknown side effects and/or interaction with individual human biochemistry of various cannabis products. As a result, the Company’s products could have certain side effects if not taken as directed or if taken by an end user that has certain known or unknown medical conditions.

If the Company is unable to develop and market new products, it may not be able to keep pace with market developments.

The cannabis industry is in its early stages and it is likely that the Company and its competitors will seek to introduce new products in the future. In attempting to keep pace with any new market developments, the Company will need to expend significant amounts of capital in order to successfully develop and generate revenues from new products. The Company may also be required to obtain additional regulatory approvals from Health Canada and other applicable authorities which may take significant time. The Company may not be successful in developing new products, bringing such products to market in time to be effectively commercialized, or obtaining any required regulatory approvals, which together with capital expenditures made in the course of such product development and regulatory approval processes, may have an material adverse effect on the Company’s business, financial condition, results of operations and prospects.

There has been limited study on the health effects of cannabis products, including CBD, and future clinical research studies may lead to conclusions that dispute or conflict with the Company’s understanding and belief regarding the medical benefits, viability, safety, efficacy, dosing and social acceptance of such products.

Research in Canada, the United States and internationally regarding the medical benefits, viability, safety, efficacy and dosing of cannabis or isolated cannabinoids, such as CBD and THC, remains in relatively early stages. There have been few clinical trials on the benefits of cannabis or isolated cannabinoids conducted by the Company or by others.

Future research and clinical trials may draw opposing conclusions to statements contained in the articles, reports and studies currently favored, or could reach different or negative conclusions regarding the medical benefits, viability, safety, efficacy, dosing or other facts and perceptions related to medical cannabis, which could adversely affect social acceptance of cannabis and the demand for the Company’s medical cannabis products.

Consumer preferences may change and the Company may be unsuccessful in retaining customers.

As a result of changing consumer preferences, many products attain financial success for a limited period of time. Even if the Company’s products find retail success, there can be no assurance that any of its products will continue to see extended financial success. The Company’s success will be significantly

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dependent upon its ability to develop new and improved product lines. Even if it is successful in introducing new products or developing its current products, a failure to gain consumer acceptance or to update products with compelling content could cause a decline in the Company’s products’ popularity that could reduce revenues and harm its business, operating results and financial condition. Failure to introduce new features and product lines and to achieve and sustain market acceptance could result in the Company being unable to meet consumer preferences and generate revenue which would have a material adverse effect on its profitability and financial results from operations.

The Company’s success depends on its ability to attract and retain customers. There are many factors which could impact its ability to attract and retain customers, including but not limited to its ability to continually produce desirable and effective products, the successful implementation of its customer acquisition plan and the continued growth in the aggregate number of potential customers. The Company’s failure to acquire and retain customers could have a material adverse effect on its business, operating results and financial position.

Trade of cannabis for non-medicinal purposes within Canada may be restricted by the Canadian Free Trade Agreement.

Article 1206 of the Canadian Free Trade Agreement specifically excludes the application of the agreement to cannabis for non-medical purposes. Article 1206 states that the provinces and territories of Canada shall commence negotiations regarding the application of the Canadian Free Trade Agreement to cannabis for non-medical purposes following Royal Assent of federal legislation legalizing cannabis for non-medical purposes. There is a risk that the outcome of the negotiations will result in the interprovincial and interterritorial trade of cannabis for non-medical purposes in Canada being entirely restricted or subject to conditions that will negatively impact the Company’s ability to sell cannabis in other provinces and territories. Due to COVID-19, negotiations regarding the application of the Canadian Free Trade Agreement to cannabis for non-medical purposes have been delayed.

The Company must rely on international advisors and consultants in the foreign countries in which it intends to operate.

The legal and regulatory requirements in the foreign countries in which the Company intends to operate with respect to the cultivation and sale of cannabis, banking systems and controls, as well as local business culture and practices are different from those in Canada. The Company’s officers and directors must rely, to a great extent, on local legal counsel and consultants in order to keep abreast of material legal, regulatory and governmental developments as they pertain to and affect its business operations, and to assist with governmental relations. The Company must rely, to some extent, on those members of management and the board of directors who have previous experience working and conducting business in these countries, if any, in order to enhance its understanding of and appreciation for the local business culture and practices. The Company also relies on the advice of local experts and professionals in connection with current and new regulations that develop in respect of the cultivation and sale of cannabis as well as in respect of banking, financing, labor, litigation and tax matters in these jurisdictions. Any developments or changes in such legal, regulatory or governmental requirements or in local business practices are beyond the Company’s control. The impact of any such changes may adversely affect the Company’s business.

The Company is required to comply concurrently with federal, state or provincial, and local laws in each jurisdiction where it operates or to which it exports its products.

Various federal, state or provincial and local laws govern the Company’s business in the jurisdictions in which it operates or proposes to operate, or to which it exports or proposes to export its products, including laws and regulations relating to health and safety, conduct of operations and the

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production, management, transportation, storage and disposal of the Company’s products and of certain material used in its operations. Compliance with these laws and regulations requires concurrent compliance with complex federal, provincial or state and local laws. These laws change frequently and may be difficult to interpret and apply. Compliance with these laws and regulations requires the investment of significant financial and managerial resources, and a determination that the Company is not in compliance with these laws and regulations could harm its brand image and business. Moreover, it is impossible for the Company to predict the cost or effect of such laws, regulations or guidelines upon future operations of the Company. Changes to these laws or regulations could negatively affect its competitive position within the industry and the markets in which it operates, and there is no assurance that various levels of government in the jurisdictions in which the Company operates will not pass legislation or regulation that adversely impacts its business.

The Company’s operations are further subject to various laws, regulations and guidelines relating to the manufacture, management, packaging/labelling, advertising, sale, transportation, storage and disposal of cannabis but also including laws and regulations relating to drugs, controlled substances, health and safety, the conduct of operations and the protection of the environment, among other areas. Changes to any such laws, regulations and guidelines due to matters beyond the control of the Company may adversely impact the business, financial condition and results of operations of the Company. The Company endeavours to comply with all relevant laws, regulations and guidelines. To the best of the Company’s knowledge, the Company is in material compliance with all such laws, regulations and guidelines.

The Company is also exposed to risks relating to the law of various international countries as a result of its planned international operations. Currently, the Company operates in or plans to operate in various international jurisdictions, including Poland, Denmark, Germany, Mexico, the United States, South Africa and Australia. As a result of these expansions, the Company may become exposed to various levels of political, economic, legal and other risks and uncertainties associated with operating in or exporting to these jurisdictions. These risks and uncertainties include, but are not limited to, changes in the laws, regulations and policies governing the production, sale and use of cannabis, cannabis-based products, hemp, CBD, political instability, currency controls, fluctuations in currency exchange rates and rates of inflation, labor unrest, changes in taxation laws, regulations and policies, restrictions on foreign exchange and repatriation and changing political conditions and governmental regulations relating to foreign investment and the cannabis and CBD businesses more generally.

Changes, if any, in the laws, regulations and policies relating to the advertising, production, sale and use of cannabis and cannabis-based products or in the general economic policies in these jurisdictions, or shifts in political attitude related thereto, may adversely affect the operations or profitability of the Company’s international operations in these countries. Specifically, the Company’s operations may be affected in varying degrees by government regulations with respect to, but not limited to, restrictions on advertising, production, price controls, export controls, controls on currency remittance, increased income taxes, restrictions on foreign investment, land and water use restrictions and government policies rewarding contracts to local competitors or requiring domestic producers or vendors to purchase supplies from a particular jurisdiction. Failure to comply strictly with applicable laws, regulations and local practices could result in additional taxes, costs, civil or criminal fines or penalties or other expenses being levied on the Company’s international operations, as well as other potential adverse consequences such as the loss of necessary permits or governmental approvals.

The CBD industry and market is new and heavily regulated with rules subject to rapidly changing laws and uncertainty, compliance with which may come with significant cost.

Continued development of the CBD industry will be dependent upon new legislative authorization of such products. Any number of events or occurrences could slow or halt progress all together in these

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industries. While the progress of the CBD product industry is currently encouraging, growth of such industries is not assured. Numerous factors may impact or negatively affect the lawmaking process within the various jurisdictions where the Company has business interests. Any one of these factors could slow or halt the use of CBD, which could negatively impact the Company’s business and possibly cause the Company to discontinue operations as a whole.

In the EU, legislative approaches to the regulation of CBD products vary country by country, including local regulations with respect to THC content, and continue to evolve; however, EU-wide rules require hemp to contain no more than 0.2% THC. There is no assurance that any EU country will authorize or continue to authorize exports, imports, cultivation or production of hemp or CBD products. In Mexico,

In South Africa, any scheduled substance may only be manufactured, imported or exported and a person may only act as a wholesaler of or distribute a scheduled substance if that person has obtained a licence from the SAHPRA in terms of section 22C of the South Africa Medicines Act. Any products in the market may only contain a maximum daily dose of 20 milligrams (mg) or less, and CBD products can’t claim to cure or treat any specific condition (they can only advertise broadly about general health enhancement or promise to relieve minor symptoms). For the law to consider a product legal, the CBD must come from hemp plants, and such hemp plants must contain up to 0.2% THC by weight.

In Australia, to get approval from the regulatory authorities, companies must show that their CBD products are safe, effective and of high quality, as well as not exceed the maximum daily dose of 150 mg or less. CBD oil is legal as long as it contains at least 98% cannabidiol and < 2% of other cannabinoids found in cannabis.

If any of these local laws or regulations prevent or discourage the Company from achieving its business goals, they may have an adverse effect upon the Company’s operations or restrict its ability to sell products in the future. The shifting compliance environment and the need to build and maintain robust systems to comply with different regulations in multiple jurisdictions increases the possibility that the Company may violate one or more of the requirements. If the Company’s operations are found to be in violation of any of such laws or any other governmental regulations that apply to the Company, it may be subject to penalties, including, without limitation, civil and criminal penalties, damages, fines, the curtailment or restructuring of its operations, any of which could adversely affect the ability to operate its business and its financial results.

The CBD products industry and market in the EU, Mexico, South Africa and Australia are also subject to many of the same risks as the adult-use cannabis industry and market.

The CBD products industry and market in the EU, Mexico, South Africa and Australia are subject to certain risks that are unique to these products, as well as many of the same risks that are applicable to the adult-use cannabis industry, including risks related to the need for regulatory approvals, the early status and uncertain growth of these industries, the general agricultural risks and the competition the Company expects to face in these industries.

If any of these shared risks occur, the Company’s business, financial condition, results of operations and prospects could be adversely affected in a number of ways, including by its inability to successfully compete in the hemp and CBD industries and by its being subject to fines, damage awards and other penalties as a result of regulatory infractions or other claims brought against the Company.

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The Company has entered into and in the future may seek to enter into strategic alliances including contractual relationships, joint ventures, selective acquisitions, licensing arrangements or other relationships, or expand the scope of currently existing relationships, with third parties that the Company believes will have a beneficial impact, and there are risks that such strategic alliances or expansions of the Company’s currently existing relationships may not continue or enhance its business in the desired manner.

The Company currently has, and may expand the scope of, and may in the future enter into, strategic alliances including contractual relationships, joint ventures, selective acquisitions, licensing arrangements or other relationships with third parties that it believes will complement or augment its existing business. The Company’s ability to complete further such strategic alliances is dependent upon, and may be limited by, among other things, the availability of suitable candidates and capital. In addition, strategic alliances could present unforeseen integration obstacles or costs, may not enhance the Company’s business and may involve risks that could adversely affect the Company, including the investment of significant amounts of management time that may be diverted from operations in order to pursue and complete such transactions or maintain such strategic alliances. Future strategic alliances could result in the incurrence of debt, costs and contingent liabilities, and there can be no assurance that future strategic alliances will achieve, or that the Company’s existing strategic alliances will continue to achieve, the expected benefits to its business or that it will be able to consummate future strategic alliances on satisfactory terms, or at all.

The Company may not be able to successfully identify and execute future acquisitions or successfully manage the impacts of such transactions on its operations.

The Company may seek strategic acquisitions in the future. The Company’s ability to identify, consummate and integrate effectively any future potential acquisitions on terms that are favorable to it may be limited by the number of attractive acquisition targets, internal demands on its resources and, to the extent necessary, its ability to obtain financing on satisfactory terms, if at all. Acquisitions may expose the Company to additional risks including difficulties in integrating administrative, financial reporting, operational and information systems and managing newly acquired operations and improving their operating efficiency, difficulties in maintaining uniform standards, controls, procedures and policies through all of the Company’s operations, entry into markets in which the Company has little or no direct experience; difficulties in retaining key employees of the acquired operations; and disruptions to its ongoing business. In addition, future acquisitions could result in the incurrence of additional debt, costs, and contingent liabilities to the Company. The Company may also incur costs for and divert management attention to potential acquisitions that are never consummated. For acquisitions that are consummated, expected synergies may not materialize. The Company’s failure to effectively address any of these issues could have a material adverse effect on its business, financial condition, results of operations and cash flows in the future.

The Company may be subject to acquisition and integration risk related to the Galaxie Transaction.

The Company recently completed the Galaxie Transaction and may in the future make further acquisitions and investments that could divert management’s attention, result in operating difficulties and dilution to our shareholders and otherwise disrupt our operations. The Company may have difficulty integrating any such acquisitions, including the Galaxie Transaction, successfully or realizing the anticipated benefits therefrom, any of which could have a material adverse effect on the Company’s business, financial condition, results of operations, cash flows and prospects.

Pursuing potential strategic acquisitions or investment opportunities is one possible growth strategy. Any transactions that the Company enter into could be material to its business, financial condition, results of operations, cash flows and prospects. The process of acquiring and integrating another company

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or technology could create unforeseen operating difficulties and expenditures. Acquisitions and investments involve a number of risks, including:

• diversion of management time and focus from operating the Company’s business;

• use of resources that are needed in other areas of the Company’s business;

• integration of the acquired company;

• implementation or remediation of controls, procedures and policies of the acquired company;

• difficulty integrating the accounting systems and operations of the acquired company;

• coordination of product, engineering and selling and marketing functions, including difficulties and additional expenses associated with supporting legacy services and products and hosting infrastructure of the acquired company and difficulty converting the customers of the acquired company onto its platform, including disparities in the revenue, licensing, support or professional services model of the acquired company;

• difficulty integrating, supporting or enhancing acquired products or services, including difficulty in transitioning acquired products or services;

• retention and integration of employees from the acquired company, and preservation of its corporate culture;

• the potential loss of key employees;

• unforeseen costs or liabilities, including the use of substantial portions of its available cash to consummate the acquisition;

• adverse effects to its existing business relationships with customers as a result of the acquisition or investment;

• the possibility of adverse tax consequences;

• litigation or other claims arising in connection with the acquired company or investment; and

• the need to integrate potential operations across different cultures and languages and to address the particular economic, currency, political and regulatory risks associated with specific countries.

Acquisitions are accompanied by the risk that the obligations and liabilities of an acquired company or asset may not be adequately reflected in the historical financial statements of or other financial information relating to such company or asset and the risk that such historical financial statements may be based on assumptions, which are incorrect or inconsistent with the Company’s assumptions or approach to accounting policies. In addition, such future acquisitions could involve tangential businesses which could alter the strategy and direction of the Company. Furthermore, a significant portion of the purchase price of companies the Company has acquired may be allocated to acquired goodwill and other intangible assets, which must be assessed for impairment at least annually. In the future, if the Company’s acquisitions do not yield expected returns, the Company may be required to take charges to its operating results based on this impairment assessment process, which could adversely affect its results of operations.

Although the Company has conducted and will conduct due diligence in connection with potential strategic acquisitions or investment opportunities and potential vendors have, may or will provide a number of representations and warranties in favour of the Company in connection with these acquisitions, an unavoidable level of risk remains regarding any undisclosed or unknown liabilities of or issues concerning the acquired entities. Following the closing of any potential strategic acquisitions or investment opportunities, the Company may discover that it has acquired substantial undisclosed liabilities or that certain of the representations made by the vendors are untrue. There can be no assurance of recovery by the Company from potential insurers or potential vendors for any breach of the representations, warranties or covenants to be provided by such potential vendors under the applicable acquisition agreements because there can be no assurance that the amount and length of such potential insurance coverage or of the potential indemnification obligations will be sufficient to satisfy such potential obligations, or that such potential

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vendors will has any assets or continue to exist. The Company’s eventual inability to claim for full indemnification from potential vendors could have a material and adverse effect on the Company.

Acquisitions and investments may also result in dilutive issuances of equity securities, which could adversely affect its share price, or result in the incurrence of debt with restrictive covenants that limit the Company’s future uses of capital in pursuit of business opportunities. Additionally, the Company, and any potential target for a strategic acquisition or investment as a combined entity, is subject to numerous risks that could adversely affect the Company’s growth and profitability, including: (i) the risk that the Company may not be able to successfully manage a potential target for a strategic acquisition or investment’s operations, (ii) the risk that its operational, financial and management systems may be incompatible with, or inadequate to effectively integrate and manage systems acquired from potential target for a strategic acquisition or investment, (iii) the risk that a potential strategic acquisition or investment may require financial resources that could otherwise be used in the development of other aspects of its business, (v) the risk that the Company may not obtain the consents required under agreements entered into with third parties, (vi) the risk that the integration process may result in operational problems, costs, expenses, liabilities, including loss of contracts and customers, and (vii) the risk that the Company’s key management or employees and of a potential target for a strategic acquisition or investment may not be retained or may leave following the strategic acquisition or investment, which could have a significant impact on the combined entity’s operations, specifically if such departures were to occur in positions or roles which require significant technical and operational knowledge and for which qualified replacement personnel is scarce.

The successful integration of recent and potential strategic acquisitions or investments will also require cooperation between the Company’s employees and the acquired companies or investees and is subject to the risk that personnel from the Company and the acquired companies or investees may not be able to work together successfully, which could adversely impact the Company’s business, financial condition and results of operations. The Company may not be able to identify acquisition or investment opportunities that meet its strategic objectives, or to the extent such opportunities are identified, the Company may not be able to negotiate terms with respect to the acquisition or investment that are acceptable to the Company.

The Company may be subject to risks associated with the permits and approvals on real property acquired in the Galaxie Transaction.

The Company’s operations may require permits from various federal, provincial and local governmental authorities and will be governed by laws and regulations governing cannabis, occupational health, waste disposal, land use, environmental protections, and other matters. Adverse changes or developments affecting the Company’s facilities, including but not limited to the failure to maintain all requisite regulatory and ancillary permits and licenses, the failure to comply with state or municipal regulations, or a breach of security, could have a material adverse effect on the Company’s business, financial condition, results of operations and prospects. In addition, any breach of any leases relating to any of the Company’s real property, or any failure to renew any applicable leases on materially similar or more favorable terms, may have a material adverse effect on the Company’s business, financial condition, results of operations and prospects, and could also have an impact on the Company’s ability to continue operating.

The Puslinch Facility is subject to provincial and municipal regulation and oversight, including the acquisition of all required regulatory and ancillary permits to conduct operations or undertake any construction. Any breach of regulatory requirements, security measures or other facility requirements, including any failure to comply with recommendations or requirements arising from inspections by government regulators at all levels, could also have an impact on the Company’s ability to keep the Puslinch

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Facility in good standing, and to continue operating its business. There can be no guarantee that the Company has or will be able to obtain all necessary permits and approvals.

The Puslinch Facility continues to operate with routine maintenance. The Company will bear many, if not all, of the costs of maintenance and upkeep of the Puslinch Facility, including replacement of components over time. The Company’s operations and the Company’s financial performance may be adversely affected if the Company is unable to keep up with maintenance requirements.

The cultivation of cannabis includes risks inherent in an agricultural business including the risk of crop loss, sudden changes in environmental conditions, equipment failure, product recalls and others.

The Company grows cannabis which is an agricultural process. As such, its business is subject to the risks inherent in the agricultural business, including risks of crop failure presented by weather, insects, fire, plant diseases and similar agricultural risks. Although the Company currently grows its products indoors under climate controlled conditions, there can be no assurance that natural elements, such as insects and plant diseases, will not entirely interrupt its production activities or have an adverse effect on its business. In addition, cannabis plants can be vulnerable to various pathogens including bacteria, fungi, viruses and other miscellaneous pathogens. Such instances often lead to reduced crop quality, stunted growth and/or death of the plant. Moreover, cannabis is phytoremediative meaning that it may extract toxins or other undesirable chemicals or compounds from the ground in which it is planted. Various regulatory agencies have established maximum limits for pathogens, toxins, chemicals and other compounds that may be present in agricultural materials. If the Company’s cannabis is found to have levels of pathogens, toxins, chemicals or other undesirable compounds that exceed established limits, the Company’s product may not be suitable for commercialization and the Company may have to destroy the applicable portions of its crops. Crops loss due to pathogens, toxins, chemicals or other undesirable compounds may have a material adverse effect on the Company’s business and financial condition.

The Company is reliant on key inputs, such as water and utilities, and any interruption of these services could have a material adverse effect on the Company’s finances and operation results. The Company is also dependent on access to skilled labour, equipment and parts.

The Company’s business is dependent on a number of key inputs and their related costs including raw materials and supplies related to its growing operations, as well as electricity, water and other local utilities. Any significant interruption or negative change in the availability or economics of the supply chain for key inputs, could materially impact the business, financial condition and operating results of the Company. Any inability to secure required supplies and services or to do so on appropriate terms could have a materially adverse impact on the business, financial condition and operating results of the Company. In addition, the Company’s operations could be significantly affected by a prolonged power outage.

The ability of the Company to compete and grow will be dependent on having access, at a reasonable cost and in a timely manner, to skilled labour, equipment, parts and components. No assurances can be given that the Company will be successful in maintaining the required supply of skilled labour, equipment, parts and components. It is also possible that the expansion plans contemplated by the Company may cost more than anticipated, in which circumstance the Company may curtail, or extend timeframes for completing the expansion plans. This could have a material adverse effect on the financial results and operations of the Company.

The Company is vulnerable to rising energy and transportation costs.

The Company’s cannabis cultivation operations consume considerable energy, including electricity and natural gas, making the Company vulnerable to rising energy costs, including as a result of regulatory

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systems that impose a levy or additional price on the distribution or use of carbon-intensive energy sources. Similarly, the Company is vulnerable to rising transportation costs as a result of fuel increases driven by numerous global factors. Rising or volatile energy and transportation costs may adversely impact the business of the Company and its ability to operate profitably.

The Company’s quality control systems may not operate effectively.

The quality and safety of the Company’s products are critical to the success of its business and operations. As such, it is imperative that the Company’s (and its service providers’) quality control systems operate effectively and successfully. Quality control systems can be negatively impacted by the design of the quality control systems, the quality training program, and adherence by employees to quality control guidelines. Although the Company strives to ensure that all of its service providers have implemented and adhere to high caliber quality control systems, any significant failure or deterioration of such quality control systems could have a material adverse effect on the business and operating results of the Company.

The Company’s cannabis products may be subject to recalls for a variety of reasons, which could require it to expend significant management and capital resources.

Manufacturers and distributors of products are sometimes subject to the recall or return of their products for a variety of reasons, including public health and public safety risks, product defects, such as contamination or mould, adulteration, unintended harmful side effects or interactions with other substances, packaging safety and inadequate or inaccurate labeling disclosure. Such defects may arise due to the fault of the Company or as a result of a faulty input to the Company’s products. In addition, as a producer of organic cannabis, a recall could arise because any supplier of inputs to the Company failed to adhere to organic standards. If any of the Company’s products are recalled due to an alleged product defect or for any other reason, the Company could be required to incur the unexpected expense of the recall and any legal proceedings that might arise in connection with the recall. The Company may lose a significant amount of sales and may not be able to replace those sales at an acceptable margin or at all. In addition, a product recall may require significant management attention.

Although the Company has detailed procedures in place for testing finished cannabis products, there can be no assurance that any quality, potency or contamination problems will be detected in time to avoid unforeseen product recalls, regulatory action or lawsuits, whether frivolous or otherwise. Additionally, if one of the Company’s significant brands were subject to recall, the image of that brand and the Company could be harmed. A recall for any of the foregoing reasons could lead to decreased demand for the Company’s products and could have a material adverse effect on the results of operations and financial condition of the Company. Additionally, product recalls may lead to increased scrutiny of the Company’s operations by Health Canada or other regulatory agencies, requiring further management attention and potential legal fees and other expenses.

While the Company has not been subject to a recall to date, if any of the cannabis products produced by the Company are recalled in the future due to an alleged product defect or for any other reason, the Company could be required to incur the unexpected expense of the recall and any legal proceedings that might arise in connection with the recall. As a result of any such recall, it may lose a significant amount of sales and may not be able to replace those sales at an acceptable margin or at all. In addition, a product recall may require significant management attention or damage the Company’s reputation and goodwill or that of its products or brands.

Any product recall affecting the cannabis industry more broadly, whether or not involving the Company, could also lead consumers to lose confidence in the safety and security of the products sold by entities licensed under the Cannabis Act generally, including products sold by the Company.

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The Company faces an inherent risk of exposure to product liability.

As a cultivator, manufacturer and distributor of products designed to be ingested by humans, the Company faces an inherent risk of exposure to product liability claims, regulatory action and litigation if its products are alleged to have caused significant loss, injury or death. The Company may be subject to these types of claims due to allegations that its products caused or contributed to injury, illness or death, made false, misleading or impermissible claims, failed to include adequate labelling and instructions for use or failed to include adequate warnings concerning possible side effects or interactions with other substances. In addition, the cultivation, manufacture and sale of the Company’s products involve the risk of injury to consumers due to tampering by unauthorized third parties, product contamination or mould. Previously unknown adverse reactions resulting from human consumption of the Company’s products alone or in combination with other medications or substances may result from, among other causes, inadequate instructions for use or include inadequate warnings concerning possible side effects or interactions with other substances. The manufacture and sale of cannabis products, like the manufacture and sale of any ingested or consumable product, involves a risk of injury to consumers due to tampering by unauthorized third parties or product contamination. The Company may in the future have to recall certain of its cannabis products as a result of potential contamination and quality assurance concerns. A product liability claim or regulatory action against the Company could result in increased costs, could adversely affect the Company’s reputation with its clients and consumers generally, and could have a material adverse effect on the results of operations and financial condition of the Company.

There can be no assurances that the Company will be able to obtain or maintain product liability insurance on acceptable terms or with adequate coverage against potential liabilities. Such insurance is expensive and may not be available in the future on acceptable terms, or at all. The inability to obtain sufficient insurance coverage on reasonable terms or to otherwise protect against potential product liability claims could prevent or inhibit the commercialization of the Company’s potential products. As of the current date, the Company has insurance coverage for product liabilities as required by the supply agreement with the OCRC.

The Company’s operations are subject to safety, health and environmental laws and regulations applicable to its operations and industry in the various jurisdictions in which it operates, and it may be held liable for any breaches of those laws and regulations.

Safety, health and environmental laws and regulations affect nearly all aspects of the Company’s operations, including product development, working conditions, waste disposal, emission controls, the maintenance of air and water quality standards and land reclamation, and, with respect to environmental laws and regulations, impose limitations on the generation, transportation, storage and disposal of solid and hazardous waste and the emission, discharge and release of hazardous substances. Environmental laws and regulations to address climate change may also impose a levy or additional price on the distribution or use of carbon-intensive fuels, such as natural gas, which are required in connection with the Company’s operations. Environmental laws and regulations also require the Company to obtain and maintain in good standing environmental approvals and permits application to the Company’s operations.

Compliance with safety, health and environmental laws and regulations can require significant capital and operating expenditures, and failure to comply with such safety, health and environmental laws may result in enforcement actions and other actions, orders and proceeding thereunder, including the imposition of fines and penalties, the temporary or permanent suspension of operations, and the imposition of clean-up costs resulting from contaminated properties. The Company may also be required to compensate those suffering loss or damage due to safety, health or environmental incidents relating to the Company’s operations. Furthermore, to the extent environmental approvals and permits are required and not obtained, the Company may also be curtailed or prohibited from its proposed business activities or from proceeding

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with the development of its operations as currently proposed. Exposure to these liabilities may arise in connection with the Company’s existing operations, its historical operations and any operations that may in the future cease to operate or be sold to third parties. The Company could also be held liable for worker exposure to hazardous substances and for accidents causing injury or death. There can be no assurance that the Company will at all times be in compliance with all safety, health and environmental laws and regulations notwithstanding its attempts to comply with such laws and regulations.

Changes in applicable safety, health and environmental laws and regulations may impose stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed projects and a heightened degree of responsibility for companies and their officers, directors and employees. The Company is not able to determine the specific impact that future changes in safety, health and environmental laws and regulations may have on the Company’s industry, operations and/or activities and its resulting financial position; however, it anticipates that capital expenditures and operating expenses will increase in the future as a result of the implementation of new and increasingly stringent safety, health and environmental laws and regulations, including more stringent requirements to obtain necessary permits in relation thereto.

The Company could be liable for fraudulent or illegal activity by its employees, contractors and consultants resulting in significant financial losses for claims against the Company.

The Company is exposed to the risk that its employees, independent contractors, consultants, service providers and licensors may engage in fraudulent or other illegal activity. Misconduct by these parties could include intentional, reckless and/or negligent conduct or activities that violate: (i) government regulations, specifically Health Canada regulations; (ii) manufacturing standards; (iii) the Cannabis Act and the Cannabis Regulations; (iv) provincial cannabis laws and regulations; (v) federal and provincial healthcare fraud and abuse laws and regulations; (vi) laws that require the true, complete and accurate reporting of financial information or data; or (vii) the terms of the Company’s agreements with insurers. In particular, the Company could be exposed to class action and other litigation, increased Health Canada inspections and related sanctions, lost sales and revenue or reputational damage as a result of prohibited activities that are undertaken in the growing or production process of the Company’s products without its knowledge or permission and contrary to its internal policies, procedures and operating requirements.

It is not always possible for the Company to identify and prevent misconduct by its employees and other third parties, and the precautions taken by the Company to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting the Company from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations. If any such actions are instituted against the Company, and it is not successful in defending itself or asserting its rights, those actions could have a significant impact on the Company’s business, including the imposition of civil, criminal and administrative penalties, damages, monetary fines, contractual damages, reputational harm, diminished profits and future earnings, and curtailment of the Company’s operations, any of which could have a material adverse effect on the Company’s business, financial condition and results of operations.

The Company may become subject to litigation in the ordinary course of business.

The Company may become subject to litigation from time to time in the ordinary course of business, some of which may adversely affect its business. Should any litigation in which the Company becomes involved be determined against the Company, such a decision could adversely affect the Company’s ability to continue operating, the value or market price for the Common Shares and could require the use of significant resources. Even if the Company is involved in litigation and is ultimately successful, litigation

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can require the redirection of significant resources. Litigation may also create a negative perception of the Company’s brand.

The Company will be reliant on information technology systems and may be subject to damaging cyberattacks.

The Company has entered into agreements with third parties for hardware, software, telecommunications and other information technology (“ IT ”) services. The Company’s operations depend, in part, on how well it and its suppliers and vendors protect networks, equipment, IT systems and software against damage from a number of threats, including, but not limited to, cable cuts, damage to physical plants, natural disasters, intentional damage and destruction, fire, power loss, hacking, computer viruses, spyware, vandalism and theft. The Company’s operations also depend on the timely maintenance, upgrade and replacement of networks, equipment, IT systems and software, as well as pre-emptive expenses to mitigate the risks of failures. Any of these and other events could result in information system failures, delays and/or increase in capital expenses. The failure of information systems or a component of information systems could, depending on the nature of any such failure, adversely impact the Company’s operations, reputation and results of operations.

The Company has not experienced any material losses to date relating to cyber-attacks or other information security breaches, but there can be no assurance that the Company will not incur such losses in the future. The Company’s risk and exposure to these matters cannot be fully mitigated because of, among other things, the evolving nature of these threats. As a result, cyber-security and the continued development and enhancement of controls, processes and practices designed to protect systems, computers, software, data and networks from attack, damage or unauthorized access is a priority. As cyber-threats continue to evolve, the Company may be required to expend additional resources to continue to modify or enhance protective measures or to investigate and remediate any security vulnerabilities.

The Company may be exposed to liability or the threat of liability in relation to the use of customer information and other personal and confidential information

The Company collects, processes, maintains and uses data, including sensitive personal information on individuals, available to it through online activities and other customer interactions with its business. The Company’s current and future marketing programs may depend on its ability to collect, maintain and use this information, and its ability to do so is subject to evolving laws and enforcement trends in Canada and other jurisdictions. The Company strives to comply with all applicable laws and other legal obligations relating to privacy, data protection and customer protection, including those relating to the use of medical information and data for marketing purposes. It is possible, however, that these requirements may be interpreted and applied in a manner that is inconsistent from one jurisdiction to another, conflict with other rules, conflict with the Company’s practices or fail to be observed by its employees or business partners. If so, the Company may suffer damage to its reputation and be subject to proceedings or actions against it by governmental entities or others. Any such proceeding or action could hurt its reputation, force it to spend significant amounts to defend its practices, distract its management or otherwise have an adverse effect on its business.

Certain marketing practices of the Company rely upon e-mail, social media and other means of digital communication to communicate with consumers on its behalf. The Company may face risk if its use of e-mail, social media or other means of digital communication is found to violate applicable laws. The Company posts its privacy policy and practices concerning the use and disclosure of user data on its website. Any failure by the Company to comply with its posted privacy policy, anti-spam legislation or other privacy-related laws and regulations could result in proceedings which could potentially harm its business. In addition, as data privacy and marketing laws change, the Company may incur additional costs to ensure

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it remains in compliance. If applicable data privacy and marketing laws become more restrictive at the international, federal, provincial or state levels, the Company’s compliance costs may increase, its ability to effectively engage customers via personalized marketing may decrease, its investment in its e-commerce platform may not be fully realized, its opportunities for growth may be curtailed by its compliance burden and its potential reputational harm or liability for security breaches may increase.

The Company may be subject to risks related to the protection and enforcement of its intellectual property rights, or intellectual property it licenses from others, and may become subject to allegations that it or its licensors are in violation of intellectual property rights of third parties.

The ownership, licensing and protection of trademarks and other intellectual property rights are significant aspects of the Company’s future success.

It is possible that the Company will not be able to register, maintain registration for or enforce all of its intellectual property, including trademarks, in all key jurisdictions. The intellectual property registration process can be expensive and time-consuming, and the Company may not be able to file and prosecute all necessary or desirable intellectual property applications at a reasonable cost or in a timely manner or may obtain intellectual property registrations which are invalid. It is also possible that the Company will fail to identify patentable aspects of inventions made in the course of their development and commercialization activities before it is too late to obtain patent protection for them. Further, changes in either intellectual property laws or interpretation of intellectual property laws in Canada, and other countries may diminish the value of the Company’s intellectual property rights or narrow the scope of its intellectual property protection. As a result, the Company’s current or future intellectual property portfolio may not provide it with sufficient rights to protect its business, including its products, processes and brands.

Termination or limitation of the scope of any intellectual property licence may restrict or delay or eliminate the Company’s ability to develop and commercialize its products, which could adversely affect its business. The Company cannot guarantee that any third-party technology it licenses will not be unenforceable or licensed to its competitors or used by others. In the future, the Company may need to obtain licences, renew existing licence agreements in place at such time or otherwise replace existing technology. The Company is unable to predict whether these licence agreements can be obtained or renewed or the technology can be replaced on acceptable terms, or at all.

Unauthorized parties may attempt to replicate or otherwise obtain and use the Company’s products, brands and technology. Policing the unauthorized use of the Company’s current or future trademarks, patents or other intellectual property rights could be difficult, expensive, time consuming and unpredictable, as may be enforcing these rights against unauthorized use by others. Identifying the unauthorized use of intellectual property rights is difficult as the Company may be unable to effectively monitor and evaluate the products being distributed by its competitors, including parties such as unlicensed dispensaries and black-market participants, and the processes used to produce such products. In addition, in any infringement proceeding, some or all of the Company’s trademarks or other intellectual property rights or other proprietary know-how, or those it licences from others, or arrangements or agreements seeking to protect the same for the Company’s benefit, may be found invalid, unenforceable, anti-competitive or not infringed; may be interpreted narrowly; or could put existing intellectual property applications at risk of not being issued.

In addition, other parties may claim that the Company’s products, or those it licenses from others, infringe on their intellectual property, including their proprietary or patent protected rights. Such claims, whether or not meritorious, may result in the expenditure of significant financial and managerial resources and legal fees, result in injunctions or temporary restraining orders or require the payment of damages. As well, the Company may need to obtain licences from third parties who allege that it has infringed on their

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lawful rights. Such licences may not be available on terms acceptable to the Company, or at all. In addition, the Company may not be able to obtain or utilize on terms that are favorable to it, or at all, licences or other rights with respect to intellectual property that the Company does not own.

The Company also relies on certain trade secrets, technical know-how and proprietary information that are not protected by patents to maintain its competitive position. The Company’s trade secrets, technical know-how and proprietary information, which are not protected by patents, may become known to or be independently developed by competitors, which could adversely affect the Company.

The Company may be subject to breaches of security at its facilities.

Given the nature of the Company’s product and the limited legal channels for distribution, as well as the concentration of inventory in its facilities, despite meeting or exceeding Health Canada’s security requirements, there remains a risk of shrinkage as well as theft and other security breaches. A security breach at one of the Company’s facilities could result in a significant loss of available product and could expose the Company to additional liability under applicable regulations and to potentially costly litigation, increase expenses relating to the resolution and future prevention of these breaches and may deter potential patients from choosing the Company’s products, any of which could have an adverse effect on the Company’s business, financial condition, results of operations and prospects.

Management may not be able to successfully implement adequate internal controls over financial reporting.

Proper systems of internal control over financial reporting and disclosure are critical to the operation of a public company. However, the Company does not expect that its internal control over financial reporting and disclosure will prevent all errors and remove all risk of fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of such controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Due to the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and may not be detected in a timely manner or at all. If the Company cannot provide reliable financial reports or prevent fraud, its reputation and operating results could be materially adversely affected, which could cause investors to lose confidence in the Company and its reported financial information, which in turn could result in a reduction in the value of its Common Shares.

If the Company has a material weakness in its internal controls over financial reporting, investors could lose confidence in the reliability of the Company’s financial statements, which could result in a decrease in the value of the Company’s securities.

One or more material weaknesses in the Company’s internal controls over financial reporting could occur or be identified in the future. In addition, because of inherent limitations, the Company’s internal controls over financial reporting may not prevent or detect misstatements, and any projections of any evaluation of effectiveness of internal controls to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the Company’s policies or procedures may deteriorate. If the Company fails to maintain the adequacy of its internal controls, including any failure or difficulty in implementing required new or improved controls, its business and results of operations could be harmed, the Company may not be able to provide reasonable assurance as to its financial results or meet its reporting obligations and there could be a material adverse effect on the price of its securities.

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The Company has negative operating cash flow.

There is no guarantee that the Company will ever become profitable. The Company currently has a negative operating cash flow and that may continue to have that for the foreseeable future. To date, the Company has only recently generated significant revenues and a large portion of the Company’s expenses are fixed, including expenses related to facilities, equipment, contractual commitments and personnel. As a result, the Company expects its net losses from operations will at least continue in the short term. The Company’s ability to generate additional revenues and potential to become profitable will depend largely on its ability to cultivate, manufacture and market its products. There can be no assurance that any such events will occur or that the Company will ever become profitable. Even if the Company does achieve profitability, it cannot predict the level of such profitability. If the Company sustains losses over an extended period of time, it may be unable to continue its business.

The Company has made certain assumptions related to cash flows and future sales of the Company’s product lines.

The Company expects to be required to fund negative Canadian operating cash flows prior to achieving positive Canadian operating cash flows and expects that the Company’s financial resources and expected revenues and draw downs on its Revolver Loan, will be sufficient to pay its obligations and fund its operations until May 2022. Achieving positive Canadian operating cash flows and funding operations for the coming months is reliant on increasing revenues and working capital requirements being in line with expectations, which is in turn reliant on, among other things, future sales of the Company’s product lines over the coming months. The Company’s expectations of positive Canadian operating cash flows and of achieving sufficient revenues to fund, when taken together with its other financial resources, its operations over the coming months is based on a variety of assumptions relating to production and production capacity, growth in the number of product offerings and store locations in which the Company’s products are sold, growth in total sales, consumer demand for the Company’s products, market pricing of cannabis products, cost of sales, sales and marketing expenses, the pace of opening of and increase in the total number of recreational cannabis retail stores across Canada, and the total size of the Canadian recreational and medical cannabis markets over the coming months. Actual results may vary materially from the Company’s expectations if any of the Company’s assumptions are inaccurate. Accordingly, readers should not place undue reliance on forward-looking statements, including the Company’s expectations relating to future Canadian operating cash flows and sales of its products.

The Company may be subject to credit risk.

Credit risk is the risk that the counterparty to a financial instrument fails to meet its contractual obligations, resulting in a financial loss to the Company. There are no assurances that the Company’s counterparties or customers will meet their contractual obligations to the Company.

Tax and accounting requirements may change in ways that are unforeseen to the Company and it may face difficulty or be unable to implement or comply with any such changes.

The Company is subject to numerous tax and accounting requirements, and changes in existing accounting or taxation rules or practices, or varying interpretations of current rules or practices, could have a significant adverse effect on its financial results, the manner in which it conducts its business or the marketability of any of its products. The Company currently has international operations and may to expand such operations in the future. These operations, and any expansion thereto, will require the Company to comply with the tax laws and regulations of multiple jurisdictions, which may vary substantially. Complying with the tax laws of these jurisdictions can be time consuming and expensive and could potentially subject the Company to penalties and fees in the future if it was to fail to comply.

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The Company may not be able to renew or secure adequate insurance to protect its assets, operations and employees.

The Company may not be able to renew or secure adequate insurance to protect its assets, operations and employees. While the Company may, in the future obtain insurance coverage to address all material risks to which it is exposed and is adequate and customary in its proposed state of operations, such insurance will be subject to coverage limits and exclusions and may not be available for the risks and hazards to which the Company is expected to be exposed. In addition, no assurance can be given that such insurance will be adequate to cover the Company’s liabilities or will be generally available in the future, or if available, that premiums will be commercially justifiable. If the Company were to incur substantial liability and such damages were not covered by insurance or were in excess of policy limits, or if the Company were to incur such liability at a time when it is not able to obtain liability insurance, its business, results of operations and financial condition could be materially adversely affected.

Fluctuations in foreign currency exchange rates could harm the Company’s results of operations.

The Company may be exposed to fluctuations of the Canadian dollar against certain other currencies because it publishes its financial statements in Canadian dollars, while a portion of its assets, liabilities, revenues and costs are or will be denominated in other currencies. Exchange rates for currencies of the countries in which the Company intends to operate may fluctuate in relation to the Canadian dollar, and such fluctuations may have a material adverse effect on the Company’s earnings or assets when translating foreign currency into Canadian dollars.

U.S. border officials could deny entry into the U.S. to non-U.S. citizens who are employees of or investors in companies with cannabis operations in the United States and Canada.

Because cannabis remains illegal under U.S. federal law, those employed at or investing in legal and licenced Canadian cannabis companies could face detention, denial of entry or lifetime bans from the U.S. for their business associations with U.S. cannabis businesses. Entry happens at the sole discretion of CBP officers on duty, and these officers have wide latitude to ask questions to determine the admissibility of a foreign national. The government of Canada has started warning travelers on its website that previous use of cannabis, or any substance prohibited by U.S. federal laws, could mean denial of entry to the U.S. Business or financial involvement in the legal cannabis industry in Canada or in the United States could also be reason enough for U.S. border guards to deny entry. On September 21, 2018, CBP released a statement outlining its current position with respect to enforcement of the laws of the United States. It stated that Canada’s legalization of cannabis will not change CBP enforcement of United States laws regarding controlled substances and because cannabis continues to be a controlled substance under United States law, working in or facilitating the proliferation of the legal marijuana industry in U.S. states where it is deemed legal or Canada may affect admissibility to the U.S. by non-U.S. citizens. As a result, CBP has affirmed that employees, directors, officers, managers and investors of companies involved in business activities related to cannabis in the U.S. or Canada (such as the Company), who are not U.S. citizens face the risk of being barred from entry into the United States for life. On October 9, 2018, CBP released an additional statement regarding the admissibility of Canadian citizens working in the legal cannabis industry. CBP stated that a Canadian citizen working in or facilitating the proliferation of the legal cannabis industry in Canada coming into the U.S. for reasons unrelated to the cannabis industry will generally be admissible to the U.S.; however, if such person is found to be coming into the U.S. for reasons related to the cannabis industry, such person may be deemed inadmissible.

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The Company is subject to risks associated with the potential expansion in the United States.

A potential expansion of the business and operations of the Company into the U.S. may require significant regulatory approvals, which could involve potentially high up-front costs, and there can be no assurances that the Company would be able to obtain such approvals after paying such costs. Following an expansion into the US, the Company would be subject to heightened regulatory and financial scrutiny which could lead to increased costs and have a material adverse effect on the financial position of the Company. As at the date of this Annual Information Form, all cannabis-related practices and activities, including without limitation, the manufacture, importation, possession, use or distribution of cannabis are illegal under U.S. federal law. This may pose a number of potential risks to the Company, including risk associated with violation of the U.S. Controlled Substances Act, banking, financial transactions, prosecution of Company employees, and violations of anti-money laundering laws and regulations.

The potential sale of the Company’s HemPoland Operations.

A sale of the HemPoland Operations, or a portion thereof, may be subject to a number of conditions including potential financing conditions, and regulatory approvals and there can be no assurances that any such conditions or approvals will be obtained and that the transaction will be completed in a timely manner. There can be no assurances that a sale of the HemPoland Operations, or a portion thereof, will be advantageous to the Company or that the Company will be able to receive the fair market value for any disposed assets in connection with such sale and it is possible that completion of such a sale could have a material adverse effect on the financial position of the Company. There can be no assurances that the HemPoland Operations will ultimately be monetized either by way of a sale or any other form of transaction.

Risks Related to the Ownership of the Common Shares

The price of the Common Shares in public markets may experience significant fluctuations.

The market price for the Common Shares may be volatile and subject to wide fluctuations in response to numerous factors, many of which are beyond the Company’s control, including the following: (i) actual or anticipated fluctuations in its quarterly results of operations; (ii) recommendations by securities research analysts; (iii) changes in the economic performance or market valuations of other issuers that investors deem comparable to the Company; (iv) the addition or departure of the Company’s executive officers and other key personnel; (v) the release or expiration of lock-up or other transfer restrictions on the Common Shares; (vi) sales or perceived sales, or expectation of future sales, of the Common Shares; (vii) significant acquisitions or business combinations, strategic partnerships, joint ventures or capital commitments by or involving the Company or its competitors; and (viii) news reports relating to trends, concerns, technological or competitive developments, regulatory changes and other related issues in the Company’s industry or target markets.

Financial markets have recently experienced significant price and volume fluctuations which have affected the market prices of equity securities of public entities. In many cases, these fluctuations, and the effect that they have on market prices, have been unrelated to the operating performance, underlying asset values or prospects of such entities. Accordingly, the market price of the Common Shares may decline even if the Company’s operating results or prospects have not changed. Additionally, these factors, as well as other related factors, may cause decreases in asset values that are deemed not to be temporary, which may result in impairment losses to the Company. Furthermore, certain investors may base their investment decisions on considerations of the Company’s environmental, governance and social practices or the Company’s industry as a whole, and its performance in these areas against such institutions’ respective investment guidelines and criteria. The failure to satisfy such criteria may result in limited or no investment

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in the Common Shares by those institutions, which could materially adversely affect the trading price of the Common Shares.

There can be no assurance that continuing fluctuations in the price and volume of equity securities will not occur. If such increased levels of volatility and market turmoil continue for a protracted period of time, there could be a material adverse effect on the trading price of the Common Shares.

If securities or industry analysts do not continue to publish research, or publish inaccurate or unfavourable research, about the Company’s business, the Common Share price and trading volume could decline.

The trading market for the Common Shares will depend, in part, on the research and reports that securities or industry analysts publish about the Company or its business. The Company does not have any control over these analysts. Securities and industry analysts do not currently, and may never, publish research on the Company. If no securities or industry analysts commence coverage of the Company, the trading price for the Common Shares would likely be negatively impacted. In the event securities or industry analysts initiate coverage, if one or more of the analysts who cover the Company downgrade the Common Shares or publish inaccurate or unfavorable research about its business, the Company’s share price would likely decline. In addition, if the Company’s operating results fail to meet the forecast of analysts, its share price would likely decline. If one or more of these analysts cease coverage of the Company or fail to publish reports on the Company regularly, demand for the Common Shares could decrease, which might cause the Common Share price and trading volume to decline.

The Company continues to sell shares for cash to fund operations, expansion, and mergers and acquisitions that will dilute the current shareholders.

The continued development of the Company will require additional financing. If additional funds are raised through issuances of equity or convertible debt securities, existing shareholders could suffer significant dilution, and any new equity securities issued could have rights, preferences and privileges superior to those of holders of Common Shares. The Company’s articles permit the issuance of an unlimited number of Common Shares, and shareholders will have no pre-emptive rights in connection with such further issuance. The directors of the Company have discretion to determine the price and the terms of issue of further issuances. Moreover, additional Common Shares will be issued by the Company on the exercise of Options under the New Option Plan and upon the exercise of outstanding warrants. In addition, from time to time, the Company may enter into transactions to acquire assets or the shares of other companies.

It is not anticipated that any dividends will be paid to holders of Common Shares for the foreseeable future.

The Company intends to retain earnings, if any, to finance the growth and development of its business and does not intend to pay cash dividends on the Common Shares in the foreseeable future. The payment of future cash dividends, if any, will be reviewed periodically by the Board and will depend upon, among other things, conditions then existing including earnings, financial condition and capital requirements, restrictions in financing agreements, business opportunities and conditions and other factors.

The Company is subject to ongoing reporting requirements under applicable securities law and CSE Policies.

As a reporting issuer, the Company is subject to reporting requirements under applicable securities law and CSE Policies. Compliance with these requirements result in legal and financial compliance costs, make some activities more difficult, time consuming or costly and increase demand on existing systems and resources. Among other things, the Company is required to file annual, quarterly and current reports with respect to its business and results of operations and maintain effective disclosure controls and

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procedures and internal controls over financial reporting. In order to maintain and, if required, improve disclosure controls and procedures and internal controls over financial reporting to meet this standard, significant resources and management oversight is required. As a result, management’s attention may be diverted from other business concerns, which could harm the Company’s business and results of operations. The Company may need to hire additional employees to comply with these requirements in the future, which would increase its costs and expenses. Management of the Company believes that being a reporting issuer makes it more expensive to maintain director and officer liability insurance. This factor could also make it more difficult for the Company to retain qualified directors and executive officers.

DIVIDENDS AND DISTRIBUTIONS

The Company has not declared any cash dividends or distributions for any of its securities and no such dividends or distributions are contemplated for the current financial year. There are no restrictions that prevent the Company from paying dividends on its Common Shares. The Company has neither declared nor paid any dividends on its shares and it is not contemplated that the Company will pay dividends in the immediate or foreseeable future. The Company currently intends to retain future earnings, if any, to finance the expansion of its business and does not anticipate paying dividends in the foreseeable future. Any future decision to pay dividends on the Company’s Common Shares will be made by the Board on the basis of the earnings, financial requirements and other conditions existing at such time.

DESCRIPTION OF CAPITAL STRUCTURE

Common Shares

The authorized share capital of the Company consists of an unlimited number of Common Shares without par value. As at December 31, 2021, 749,660,647 Common Shares were issued and outstanding as fully paid and non-assessable common shares. As of the date hereof, 753,212,777 Common Shares were issued and outstanding as fully paid and non-assessable common shares. Included in the issued and outstanding Common Share totals are the 85,714,286 Milestone Shares which are held in escrow pursuant to the terms of the Galaxie Transaction, with their release subject to meeting certain milestone conditions set out in the Galaxie Agreement.

The holders of Common Shares are entitled to dividends as and when declared by the Board, to one vote per share at meetings of shareholders of the Company and, upon liquidation, to receive such assets of the Company as are distributable to the holders of Common Shares after payment of the Company’s creditors. There are no pre-emptive rights or conversion rights attached to the Common Shares. There are also no redemption, retraction or purchase for cancellation or surrender provisions, sinking or purchase fund provisions, or any provisions as to the modification, amendment or variation of any such rights or provisions attached to the Common Shares.

Provisions as to the modification, amendment or variation of the rights attached to the Common Shares are contained in the Company’s bylaws and the CBCA. Generally speaking, substantive changes to the authorized share structure require the approval of our shareholders by special resolution (at least twothirds of the votes cast).

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Warrants

The following table sets forth all Common Share purchase warrants of the Company that are outstanding as of December 31, 2021:

			Number of Common Shares into
Number of Warrants	Exercise Price	Expiry Date	which Warrants may be
			Exercised
20,607,500	$1.00	19-Dec-22	20,607,500
3,000,000	$0.39	01-Apr-23	3,000,000
1,500,000	$0.39	13-Apr-23	1,500,000
10,813,052	$0.38	27-Apr-23	10,813,052
500,000	$0.50	27-May-24	500,000
45,712,500	$0.50	12-Jun-24	45,712,500
24,873,354	$0.30	23-Oct-25	24,873,354
8,500,000	$0.30	02-Nov-25	8,500,000
42,085,034	$0.35	10-Dec-25	42,085,034
3,000,000	$0.14	29-Nov-26	3,000,000
TOTAL			160,591,440

Options

The following table sets forth all Options that are outstanding as of December 31, 2021:

Grant Date	Exercise price	Expiry Date	Number of Options Outstanding
25-Jun-18	$6.91	26-Jun-23	80,000
07-Sep-18	$6.20	07-Sep-23	25,000
01-Oct-18	$6.75	01-Sep-23	250,000
09-Oct-18	$6.37	09-Oct-23	85,000
25-Oct-18	$4.53	25-Oct-23	450,000
09-Nov-18	$3.82	09-Nov-23	75,000
14-Dec-18	$3.08	14-Dec-23	75,000
08-Jan-19	$2.67	08-Jan-24	600,000
21-Jan-19	$2.99	21-Jan-24	75,000
28-Jan-19	$3.41	28-Jan-24	200,000
04-Mar-19	$4.09	04-Mar-24	75,000
11-Mar-19	$4.30	11-Mar-24	200,000

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22-Mar-19	$5.13	22-Mar-24	1,446,667
13-May-19	$4.11	13-May-24	150,000
21-May-19	$3.86	21-May-24	50,000
16-Aug-19	$3.30	16-Aug-24	345,667
21-Aug-19	$3.10	21-Aug-24	83,333
18-Nov-19	$0.83	18-Nov-24	656,333
13-Mar-20	$0.37	13-Mar-25	1,519,333
28-May-20	$0.51	28-May-25	13,000
14-Aug-20	$0.44	14-Aug-25	22,333
13-Nov-20	$0.29	13-Nov-25	102,333
08-Dec-20	$0.30	08-Dec-25	9,409,999
21-Dec-20	$0.26	21-Dec-25	200,000
12-Mar-21	$0.34	12-Mar-26	662,000
19-Mar-21	$0.33	19-Mar-26	500,000
01-Apr-21	$0.30	01-Apr-26	3,790,000
14-May-21	$0.33	14-May-26	386,000
29-Jun-21	$0.36	29-Jun-26	300,000
13-Aug-21	$0.30	13-Aug-26	120,000
02-Dec-21	$0.14	02-Dec-26	2,361,000
20-Dec-21	$0.11	20-Dec-26	300,000
TOTAL			24,607,998

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Restricted Share Units and Convertible Units

The following table sets forth all restricted share units and convertible units that are outstanding as of December 31, 2021:

Date of issuance	Type of security issued	Number of securities issued	Number of securities outstanding	Exercise price per security
13-Mar-20	Restricted Share Units(1)	2,550,000	853,336	N/A
01-Apr-21	Restricted Share Units(2)	4,111,869	3,525,204	N/A
14-May-21	Restricted Share Units(3)	57,500	57,500	N/A
13-Aug-21	Restricted Share Units(4)	40,000	40,000	N/A
16-Aug-21	Restricted Share Units(5)	145,000	75,000	N/A
02-Dec-21	Restricted Share Units(6)	100,000	100,000	N/A

Notes:

(1) Issued to certain key employees as retention incentives.

(2) Issued to certain key employees and directors as retention incentives in accordance with the RSU Plan.

(3) Issued to a director as a retention incentive in accordance with the RSU Plan.

(4) Issued to certain employees of the Company in accordance with the RSU Plan.

(5) Issued to a consultant of the Company in accordance with the RSU Plan.

(6) Issued to recently appointed directors and an officer of the Company in accordance with the RSU Plan.

Escrowed Restricted Share Units

The Company issued 1,968,323 HemPoland RSUs to the former shareholders of HemPoland as part of the total consideration on completion of the HemPoland Acquisition, of which 9,842 are issued and outstanding as December 31, 2021. As of the date hereof, Common Shares have been issued to the former shareholders of HemPoland in exchange for the 9,842 outstanding HemPoland RSUs.

Contingent Share Units

As part of the HemPoland Acquisition, the Company may be required to issue up to 3,047,723 contingent share units that are exercisable into Common Shares or cash, contingent on the achievement of certain earnings goals by the end of fiscal 2021. The milestone financial goals were not achieved; therefore, no additional performance-based incentives were paid out and the contingent share units have expired.

MARKET FOR SECURITIES

The Company’s Common Shares and Warrants were listed and posted for trading on the TSX until the Company voluntarily delisted from the TSX on September 10, 2021, and completed the CSE Listing on September 13, 2021, upon which the Common Shares were listed on the CSE under the symbol “TGOD” and certain of its Warrants were listed on the CSE under “TGOD.WS”, “TGOD.WR”, “TGOD.WA” and

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“TGOD.WB”. The following table sets forth, for the periods indicated, the reported high and low prices and the trading volume of the Common Shares and Warrants:[1 ]

Common Shares

Month	High	Low	Volume
January 2021	0.390	0.230	68,200,697
February 2021	0.650	0.280	159,290,103
March 2021	0.375	0.280	53,068,939
April 2021	0.360	0.285	22,504,358
May 2021	0.490	0.290	49,890,768
June 2021	0.460	0.330	27,658,097
July 2021	0.355	0.300	13,253,587
August 2021	0.340	0.250	23,859,553
September 2021(1)	0.285	0.165	64,253,252
October 2021	0.185	0.155	11,544,576
November 2021	0.175	0.120	26,434,355
December 2021	0.130	0.090	21,024,965

Notes:

(1) The Common Shares were delisted from the TSX on September 10, 2021 and listed on the CSE on September 13, 2021.

December 2019 Warrants (TGOD.WS)

Month	High	Low	Volume
January 2021	0.040	0.015	2,075,007
February 2021	0.085	0.015	2,785,532
March 2021	0.070	0.025	1,340,864
April 2021	0.050	0.030	199,022
May 2021	0.080	0.025	553,735
June 2021	0.055	0.030	174,620
July 2021	0.050	0.040	135,800
August 2021	0.050	0.020	179,184
September 2021(1)	0.035	0.025	77,145
October 2021	0.030	0.010	92,600
November 2021	0.020	0.005	141,956
December 2021	0.015	0.005	247,956

Notes:

(1) The Warrants were delisted from the TSX on September 10, 2021 and listed on the CSE on September 13, 2021.

1 The reported high and low prices and the trading volume of the Common Shares and Warrants are sourced from TMX Historical Data Access and the CSE monthly market summaries.

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June 2020 Warrants (TGOD.WR)

Month	High	Low	Volume
January 2021	0.085	0.030	2,758,223
February 2021	0.150	0.035	3,527,940
March 2021	0.080	0.055	677,125
April 2021	0.075	0.050	1,823,370
May 2021	0.095	0.055	1,091,010
June 2021	0.100	0.060	357,862
July 2021	0.080	0.040	995,114
August 2021	0.120	0.040	770,260
September 2021(1)	0.040	0.025	410,747
October 2021	0.030	0.020	1,278,450
November 2021	0.020	0.010	223,000
December 2021	0.015	0.010	548,500

Notes:

(1) The Warrants were delisted from the TSX on September 10, 2021 and listed on the CSE on September 13, 2021.

October 2020 Warrants (TGOD.WA)

Month	High	Low	Volume
January 2021	0.140	0.065	2,884,576
February 2021	0.310	0.090	3,152,752
March 2021	0.170	0.095	527,040
April 2021	0.140	0.115	40,040
May 2021	0.190	0.120	450,000
June 2021	0.190	0.140	404,650
July 2021	0.140	0.100	289,682
August 2021	0.110	0.080	151,827
September 2021(1)	0.105	0.055	43,825
October 2021	0.065	0.005	236,159
November 2021	0.060	0.030	350,075
December 2021	0.030	0.015	550,908

Notes:

(1) The Warrants were delisted from the TSX on September 10, 2021 and listed on the CSE on September 13, 2021.

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December 2020 Warrants (TGOD.WB)

Month	High	Low	Volume
January 2021	0.100	0.050	8,495,424
February 2021	0.240	0.080	3,168,493
March 2021	0.120	0.080	549,752
April 2021	0.090	0.075	318,407
May 2021	0.160	0.075	684,307
June 2021	0.140	0.090	177,070
July 2021	0.125	0.110	11,625
August 2021	0.100	0.070	61,825
September 2021(1)	0.075	0.050	388,500
October 2021	0.055	0.040	234,081
November 2021	0.060	0.035	470,718
December 2021	0.030	0.015	420,800

Notes:

(1) The Warrants were delisted from the TSX on September 10, 2021 and listed on the CSE on September 13, 2021.

PRIOR SALES

During the financial year ended December 31, 2021, the Company issued the following securities convertible into Common Shares which are not listed or quoted on a marketplace:

Warrants

		Number of securities
Date of issuance	Type of security issued		Exercise Price per security
		issued
Nil	Nil	Nil	Nil

Lender Warrants

Date of issuance	Type of security issued	Number of securities issued	Exercise Priceper security
November 29, 2021	Lender Warrants	3,000,000	$0.14

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Stock Options

Date of issuance	Type of security issued	Number of securities issued	Exercise Price per security
March 12, 2021	Options	788,000	$0.34
March 19, 2021	Options	500,000	$0.33
April 1, 2021	Options	4,620,000	$0.30
May 14, 2021	Options	391,000	$0.33
June 29, 2021	Options	300,000	$0.36
August 13, 2021	Options	620,000	$0.30
December 2, 2021	Options	2,516,000	$0.14
December 20, 2021	Options	300,000	$0.11

Note :

(1) Please refer to the Company’s management information circular dated May 13, 2021 for additional information regarding the Company’s stock option plan.

Restricted Share Units and Convertible Units

Date of issuance	Type of security issued	Number of securities issued	Exercise Price per security
January 6, 2021	Restricted Share Units(1)	363,636	N/A
April 1, 2021	Restricted Share Units(2)	4,111,869	N/A
April 22, 2021	Restricted Share Units(3)	872,093	N/A
May 14, 2021	Restricted Share Units(4)	57,500	N/A
August 13, 2021	Restricted Share Units(5)	40,000	N/A
August 16, 2021	Restricted Share Units(6)	145,000	N/A
December 2, 2021	Restricted Share Units(7)	100,000	N/A
December 15,2021	Restricted Share Units(8)	480,000	N/A

Notes :

(1) Issued to Mr. Bertrand for advisory services provided to the Board in relation to the marketing and sales strategy of the Corporation and transition of Mr. Bovingdon into his role as the CEO of the Corporation.

(2) Issued to certain key employees and directors as retention incentives.

(3) Issued to a Consultant of the Company in accordance with the RSU Plan.

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• (4) Issued to a director as retention incentive in accordance with the RSU Plan.

• (5) Issued to certain employees of the Company in accordance with the RSU Plan.

• (6) Issued to a Consultant of the Company in accordance with the RSU Plan.

• (7) Issued to recently appointed directors and an officer of the Company in accordance with the Company’s RSU Plan.

• (8) Issued to an employee of the Company in accordance with the RSU Plan.

• (9) Please refer to the Company’s management information circular dated May 13, 2021 for additional information regarding the Company’s restricted share unit plan.

SUBSEQUENT SALES

The following tables summarize details of the Common Shares issued by the Company during the period subsequent to December 31, 2021 and up to the date of this Annual Information Form.

	Common Shares issued	Number of Common	Exercise Price per
Date of issuance
	pursuant to exercise of:	Shares issued	Common Share
January 6, 2022	Common Shares issued as part of the Company’s ATMprogram	160,000	N/A
January 7, 2022	Common Shares issued as part of the Company’s ATMprogram	129,000	N/A
January 10, 2022	Common Shares issued as part of the Company’s ATMprogram	79,500	N/A
January 11, 2022	Common Shares issued as part of the Company’s ATMprogram	29,500	N/A
February 3, 2022	Common Shares issued as part of the Company’s ATMprogram	295,500	N/A
February 4, 2022	Common Shares issued as part of the Company’s ATMprogram	113,500	N/A
February 9, 2022	Common Shares issued as part of the Company’s ATMprogram	97,000	N/A
March 9, 2022	Common Shares issued as part of the amendments made to the Revolver Loan	500,000	N/A
March 18, 2022	Restricted Share Units - HemPoland	9,842	N/A
April 14, 2022	Restricted Share Units - Vesting due to achievement of certain performance milestones in accordance with the RSU Plan	1,670,788	N/A
April 14, 2022	Restricted Share Units - Vesting of RSUs for certain directors in accordance with the RSU Plan	117,500	N/A
April 14, 2022	Restricted Share Units – Vesting of RSUs for a consultant in accordance with the RSU Plan	350,000	N/A

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The following tables summarizes details of the securities convertible into Common Shares issued by the Company during the period subsequent to December 31, 2021, and up to the date of this Annual Information Form.

Date of Issuance	Type of security issued	Number of securities issued	Exercise Price per security
January 24, 2022	Options(1)	500,000	$0.10
April 7, 2022	Options(2)	29,552,000	$0.13
April 7, 2022	Restricted Share Units(3)	350,000	N/A

Notes :

(1) Issued to Mr. Schnarr in connection with his appointment to the Board.

(2) Issued to certain key employees and directors as retention incentives.

(3) Issued to a consultant of the Company in accordance with the Company’s RSU Plan.

ESCROWED SECURITIES

Escrow and Indemnity Escrow Agreements

Pursuant to the Galaxie Agreement, the Escrow Shares are subject to the Escrow Agreement whereby one sixth of these shares will be released every four months following the closing of the Galaxie Transaction. On March 17, 2022, one-sixth of the Escrow Shares were released from escrow, with 66,666,666 Escrow Shares remaining in escrow. The Indemnity Escrow Shares and Milestone Shares were placed into an indemnity escrow account pursuant to the Indemnity Escrow Agreement to be released no later than December 31, 2023 and January 31, 2023, respectively, subject to earlier release pursuant to the escrow release terms of the Indemnity Escrow Agreement. As at December 31, 2021, approximately 27.4% of the Common Shares are subject to the Escrow Agreement and Indemnity Escrow Agreement. Included in the percentage of Common Shares subject to escrow are the 85,714,286 Milestone Shares which are held in escrow pursuant to the terms of the Galaxie Transaction, with their release subject to meeting certain milestone conditions set out in the Galaxie Agreement.

Securities Subject to Contractual Resale Restrictions

The following table sets out the securities of the Company as at December 31, 2021 that are subject to contractual resale restrictions, including securities subject to the Escrow Agreement and Indemnity Escrow Agreement.

Escrow Agreement.
Designation of Class	Number of Securities Subject to Contractual Resale Restrictions	Percentage of Class
Common Shares(1)	205,714,286	27.4%

Note :

(1) The securities were issued pursuant to the Galaxie Agreement and are subject to the Escrow Agreement and Indemnity Escrow Agreement.

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DIRECTORS AND OFFICERS

Name, Occupation and Security Holding

The following table sets forth information regarding our directors and executive officers. The term of office for the Directors expires at the Company’s next Annual General Meeting.

Name, Province or State	Positions with the	Date of	Principal Occupation Within the Past
and Country of Residence	Company	Appointment	Five Years(1)
Angus Footman(2) Hillsburgh, Ontario	Director, Chairman of the Board	November 17, 2021	Founder of Park Lane Farms, one of the first legal producers of medical cannabis products in Canada; Served as the Managing Director and President of Tweed Farms (formerly Park Lane) until 2018
Jacques Dessureault(2) (3) Montreal, Quebec	Lead Director	January 7, 2019	Independent businessman in the life science industry since 2017; Director, Optina Diagnostics since 2017; President and General Manager Valeant Canada’s from November 2012 to June 2017
Sean Bovingdon Oakville, Ontario	Chief Financial Officer	October 22, 2018	Executive Vice President and Chief Financial Officer of Toronto Hydro Corporation from April 2017 to August 2018; President and Chief Financial Officer at Argent Energy Trust from April 2015 to June 2016; and Chief Financial Officer at Argent Energy Trust from June 2011 to April 2015
	Interim Chief Executive Officer	November 10, 2020
	Chief Executive Officer & Interim Financial Officer(5)	March 9, 2021
	Director	March 9, 2021
Olivier Dufourmantelle Ottawa, Ontario	Director	November 17, 2021	Chief Operating Officer of Canopy Rivers Inc.; Chief Operating Officer of Canopy Growth Corp.; Certified Professional Engineer and has received an MBA from Harvard Business School
	President of U.S. Operations	November 17, 2021
Caroline MacCallum(4) Vancouver, British Columbia	Director	January 7, 2019	Physician/MD since 2009; Researcher and clinical instructor with the Department of Medicine at the University of British Columbia since 2013; Medical Director at Greenleaf Medical Clinic since 2015
Adam Jaffe(3) New York, New York	Director	June 29, 2021	Chief Financial Officer of Legato Merger Corp. II; Chief Financial Officer of Legato Merger Corp. and Chief Financial Officer of Allegro Merger Corp. from 2018 to 2021; Chief Financial Officer and Chief Compliance OfficerofCrescendoPartners,

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Name, Province or State	Positions with the	Date of	Principal Occupation Within the Past
and Country of Residence	Company	Appointment	Five Years(1)
			L.P. and Jamarant Capital, L.P. since 2018; New York State Certified Public Accountant
Louis Sterling(2) (4) Los Angeles, California	Director	December 20, 2021	Private investor targeting small-cap public equities and select fast-growth private companies, particularly in the health, wellness, and cannabis industries since 2017.
Chris Schnarr(3)(4) Mississauga, Ontario	Director	January 24, 2022	Corporate director and entrepreneur with over 30 years of board experience across a range of industries, including cannabis, biotech, and health care; Chair of the Audit Committee of Canopy Growth Corporation from 2014 to 2018.
Nichola Thompson London, Ontario	Chief Financial Officer	February 1, 2022	Chief Financial Officer of Galaxie; Chief Financial Officer of Embark Health Inc., and Entourage Health Corp.; Senior finance positions at Discovery Air, Deloitte & Touche, Siemens, and Priority One Packaging; Chartered Professional Accountant and Chartered Accountant
Michel Gagné Montreal, Quebec	Chief Operating Officer	November 10, 2020	General Manager for the Company’s Quebec Facility from March 2019 until his appointment as Vice President, Operations in August 2020; General Manager, Lauzon Meats division at Colabor Inc. from 2013 to 2019
Matthew Schmidt Toronto, Ontario	Executive Vice President, Corporate Development	January 2, 2018	Vice-President, Investment Banking at Echelon Wealth Partners from November 2015 to December 2016; Vice President, Investment Banking at Pope & Company from February 2007 to November 2015

Notes:

• (1) The information as to the principal occupation, business or employment is not within the knowledge of the Company and has been furnished by the respective director/officer.

• (2) Member of the Compensation Committee.

• (3) Member of the Audit Committee.

• (4) Member of the Corporate Governance & Nominating Committee.

• (5) Mr. Bovingdon resigned as Interim Chief Financial Officer on February 1, 2022, in connection with Ms. Thompson’s appointment as Chief Financial Officer.

As of the date hereof, the Directors and executive officers of the Company, as a group, beneficially own, directly or indirectly, 65,742,374 Common Shares representing approximately 8.7% of the issued and outstanding Common Shares. If the Directors and executive officers exercised the 4,905,000 vested options they hold as a group, then their ownership would increase by 4,905,000 shares and represent approximately 9.4% of the issued and outstanding Common Shares.

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Cease Trade Orders, Bankruptcies, Penalties or Sanctions

No director or executive officer of the Company is, as at the date of this Annual Information Form, or has been within 10 years before the date of this Annual Information Form, a director, chief executive officer or chief financial officer of any company (including the Company), that:

• (a) was subject to a cease trade order, an order similar to a cease trade order, or an order that denied the relevant company access to any exemption under securities legislation, that was in effect for a period of more than 30 consecutive days, that was issued while the director or executive officer was acting in the capacity as director, chief executive officer or chief financial officer, or

• (b) was subject to a cease trade order, an order similar to a cease trade order, or an order that denied the relevant company access to any exemption under securities legislation, that was in effect for a period of more than 30 consecutive days, that was issued after the director or executive officer ceased to be a director, chief executive officer or chief financial officer and which resulted from an event that occurred while that person was acting in the capacity as director, chief executive officer or chief financial officer.

Other than as set out below, no director or executive officer of the Company, nor a shareholder holding a sufficient number of securities of the Company to affect materially the control of the Company:

• (a) is, as at the date of this Annual Information Form, or has been within 10 years before the date of this Annual Information Form, a director or executive officer of any company (including the Company) that, while that person was acting in that capacity, or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets; or

• (b) has, within 10 years before the date of this Annual Information Form, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold the assets of the proposed director.

Other than as set out below, no director or executive officer of the Company has been subject to:

• (a) any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority; or

• (b) any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable security holder in deciding whether to vote for a proposed director.

Mr. Bovingdon served as the Chief Financial Officer of Argent Energy Ltd. (the “ Administrator ”), the administrator of Argent Energy Trust (the “ Trust ”), from June 2011 until August 2016 and he also served as President of the Administrator from April 2015 until August 2016. The units of the Trust were listed on the TSX. On February 17, 2016, the Trust sought and obtained protection under the CCAA. On August 30, 2016, the Court of Queen’s Bench of Alberta entered an Order, among other things, terminating the CCAA proceeding for the Trust effective August 31, 2016. On August 31, 2016, the Trust made an

• 87 -

assignment into bankruptcy, and on vesting of the Trust’s assets with the bankruptcy trustee, the Trust was deemed to be terminated by operation of law. During the CCAA proceedings, certain securities commissions in Canada (including the Alberta Securities Commission, the British Columbia Securities Commission, the Manitoba Securities Commission, and the OSC) issued cease trade orders against the Trust for failing to file interim and annual financial statements. In addition, the Trust units and convertible debentures of the Trust were delisted from the TSX effective at the close of market on March 24, 2016 for failure of the Trust to meet the continued listing requirements of the TSX.

Mr. Dufourmantelle served as the Chief Operating Officer of Canopy Rivers Inc. (“ RIV ”), a venture capital firm investing in cannabis start-up companies, from May 2017 to November 2020. As the only executive with security clearance by Health Canada at RIV, Mr. Dufourmantelle became a director of Pharmhouse Corp (“ Pharmhouse ”). Pharmhouse owned a large, licensed cannabis greenhouse that got confronted by the overcapacity of the Canadian cannabis flower market and the precipitous and unforeseen drop in cannabis flower prices. As a result, Pharmhouse was unable to generate enough revenue to cover its costs and debt servicing obligations, and as a result, in September 2020, Pharmhouse entered into CCAA proceedings.

Chris Schnarr was formerly a director and an officer of BioExx Specialty Proteins Ltd. and its subsidiaries (“ BioExx ”), from March 2006 to August 2013 which was formerly listed on the TSX. Mr. Schnarr resigned from the board of directors and as an officer of BioExx and its subsidiaries on August 28, 2013. On October 1, 2013, BioExx commenced proceedings under the Companies’ Creditors Arrangement Act (Canada). On the same date, the trading of BioExx’s shares on the TSX was halted. On November 6, 2013 the shares of BioExx were delisted from the TSX.

Conflicts of Interest

The Company’s directors and officers may serve as directors or officers, or may be associated with, other reporting companies, or have significant shareholdings in other public companies. To the extent that such other companies may participate in business or asset acquisitions, dispositions, or ventures in which the Company may participate, the directors and officers of the Company may have a conflict of interest in negotiating and concluding terms respecting the transaction. If a conflict of interest arises, the Company will follow the provisions of the CBCA dealing with conflict of interest. These provisions state that where a director has such a conflict, that director must, at a meeting of the Company’s directors, disclose his or her interest and refrain from voting on the matter unless otherwise permitted by the CBCA. In accordance with the CBCA, the directors and officers of the Company are required to act honestly, in good faith, and the best interest of the Company.

PROMOTERS

A “Promoter” is defined in the Securities Act (Ontario) as a “person who (a) alone or in concert with other persons directly or indirectly takes the initiative of founding, organizing or substantially reorganizing the business of the issuer; or (b) in connection with the founding, organization or substantial reorganization of the business of the Company, directly or indirectly receives, in consideration of services or property or both, 10% or more of a class of the Company’s own securities or 10% or more of the proceeds from the sale of a class of the Company’s own securities of a particular issue.”

Within the two most recently completed financial years ended December 31, 2021 and to the date of this Annual Information Form, no person has been a Promoter of the Company.

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LEGAL PROCEEDINGS

The Company may become subject to litigation from time to time in the ordinary course of business, some of which may adversely affect its business. The Company is currently a named party in the following matters:

1. An employment-related claim wherein the total claim is for approximately $3 million. It is alleged by the former CFO (the “ CFO Plaintiff ”) that the Company committed a breach of her employment contract. Although pleadings closed in October 2018, there was no activity for years. Recently the CFO Plaintiff served a litigation timetable to prevent her action from being administratively dismissed by the Court for lack of activity. Despite the self-imposed timetable, no steps have been taken and the action remains mostly dormant.

2. A claim brought by former warrant holders (the “ Plaintiffs ”) for approximately $1.25 million, alleging that the Company breached its duty to shareholders and was negligent in respect of its handling of share purchase warrants which the Plaintiffs assert that they were prevented from exercising due to a restrictive trading period. Recently the Company has issued a Third-Party Claim against McMillan LLP (the Company’s former counsel) alleging negligent legal advice in respect of the handling of the warrants. All parties are currently engaged in a documentary discovery process. Although nothing has been set or agreed to, there have been some preliminary discussions in relation to a potential mediation prior to the scheduling of trial.

3. A claim brought in the in the United States District Court for the Middle District of Georgia. The claim as against the Company relates to its minority interest in a US-based beverage incubation business (the “ Company Plaintiff ”). The Company Plaintiff seeks against the Company, among other things, unquantified compensatory damages in relation to claims of inducements and conspiracy. The Company and its counsel hold the position that the claim as against the Company (one of many defendants) has no merit and should be subject to the summary judgment. No evidence has been presented or disclosed, as part of the ongoing depositions and documentary disclosure, that would create liability or exposure for the Company. Although the action proceeds through a documentary disclosure process with further depositions being scheduled, the Company will be making overtures to the Company Plaintiff for a cost going forward settlement.

Should any of these claims or any other litigation in which the Company becomes involved be determined against the Company, such a decision could adversely affect the Company’s ability to continue operating, the value or market price for the Common Shares and could require the use of significant resources. Even if the Company is involved in litigation and is ultimately successful, litigation can require the redirection of significant resources. Litigation may also create a negative perception of the Company’s brand.

INTERESTS OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS

Other than as disclosed elsewhere in this Annual Information Form and in the consolidated financial statements of the Company for the year ended December 31, 2021, to the best of the Company’s knowledge, none of the directors or executive officers of the Company, or any shareholders who beneficially own, control or direct, directly or indirectly, more than 10% of the Company’s outstanding Common Shares, or any known associates or affiliates of such persons, had any material interests, direct or indirect, in any transaction within the three most recently completed financial years or during the current year that has materially affected or is reasonably expected to materially affect the Company.

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TRANSFER AGENT AND REGISTRARS

The Company’s Registrar and Transfer Agent is Odyssey Trust Company, located at 350-300 5 Ave SW, Calgary, Alberta T2P 5J2.

MATERIAL CONTRACTS

The following are the only material contracts, other than those contracts entered into in the ordinary course of business, which we have entered into since the beginning of the last financial year before the date of this Annual Information Form or entered into prior to such date but which contract is still in effect.

1. The Licence from Health Canada originally granted in August 2016, as amended August 10, 2017, October 3, 2017, December 29, 2017 and July 19, 2019 and expiring on August 16, 2022 as more particularly described under “ Description of the Business – General ”.

2. Warrant Indenture dated December 19, 2019 between the Company and Computershare with respect to the December 2019 Warrants, as more particularly described under “ Three Year History – Financings ”.

3. First Loan Amendment dated April 14, 2020 between, among others, the Company and Maynbridge Capital Inc. with respect to the Credit Facility, as more particularly described under “ Three-Year History – Financings ”. In connection with the Quebec Disposition, the Company repaid the remaining balance on its Credit Facility and terminated the loan agreement with Maynbridge Capital Inc. See “ Intercorporate Relationships – Medican Organic ” for further detail.

4. Warrant Indenture dated April 27, 2020 between the Company and Computershare with respect to the Credit Facility, as more particularly described under “ Three-Year History – Financings ”.

5. Warrant Indenture dated June 12, 2020 between the Company and Computershare with respect to the June 2020 Warrants, as more particularly described under “ Three-Year History – Financings ”.

6. Warrant Indenture dated October 23, 2020 between the Company and Computershare with respect to the October 2020 Warrants, as more particularly described under “ Three Year History – Financings ”.

7. Warrant Indenture dated December 10, 2020 between the Company and Computershare with respect to the December 2020 Warrants, as more particularly described under “ Three Year History – Financings ”.

8. Agreement of Purchase and Sale dated June 8, 2021 between Medican Organic and Cannara related to the Quebec Disposition, as more particular described under “Three-Year History – Quebec Facility Construction and Operations Updates ”.

9. Amended and Restated Credit Agreement dated September 29, 2021 between, among others, the Company and Cortland Credit Lending Corporation with respect to the Revolver Loan, as more particularly described under “ Three-Year History – Financings ”.

10. Galaxie Licence originally granted on February 24, 2021 and expires on February 7, 2023.

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12. Galaxie Agreement dated October 29, 2021 between, the Company, 2783935 Ontario Inc., and AOCO Ventures Inc. with respect to the Galaxie Transaction, as more particular described under “Three-Year History – Galaxie Brands Corporation Acquisition ”.

13. First Amendment to the Amended and Restated Credit Agreement dated November 30, 2021 between, among others, the Company and Cortland Credit Lending Corporation with respect to the Revolver Loan, as more particularly described under “ Three-Year History – Financings ”.

14. Second Amendment to the Amended and Restated Credit Agreement dated March 9, 2022 between, among others, the Company and Cortland Credit Lending Corporation with respect to the Revolver Loan, as more particularly described under “ Three-Year History – Financings ”.

INTEREST OF EXPERTS

Name of Experts

The following are the persons or companies who were named as having prepared or certified a statement, report or valuation in this Annual Information Form either directly or in a document incorporated by reference and whose profession or business gives authority to the statement, report or valuation made by the person or company:

KPMG LLP, the Company’s independent auditors, has prepared an independent audit report dated April 5, 2022 in respect of the Company’s audited consolidated financial statements as at December 31, 2021.

Interests of Experts

KPMG LLP, auditors of the Company, have confirmed that they are independent of the Company within the meaning of the CPA Code of Professional Conduct of the Chartered Professional Accountants of Ontario.

AUDIT COMMITTEE

The Company’s audit committee has various responsibilities as set forth in NI 52-110 made under securities legislation, concerning constitution of its audit committee and its relationship with its independent auditor and among such responsibilities being a requirement that the audit committee establish a written charter that sets out its responsibilities.

Composition of the Audit Committee

At the present time, the Company’s Audit Committee is composed of the following members:

Member	Independent/Not Independent(1)	Financially Literate/ Not Financially Literate (2)	Relevant Education and Experience
Chris Schnarr(3)	Independent	Financially Literate	Mr. Schnarr, 55, is an entrepreneur with over 30 years of board experience across a range of industries, including cannabis, biotech, and health care. A graduate of the Director’s Education Program at Rotman School of Business and holder of the ICD.D designation, Mr. Schnarr’s board experience spans 10 public

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			companies and three private companies. He has extensive committee experience, including Audit, Governance, and Compensation, having chaired Canopy Growth Corp.’s audit committee for four years.
Jacques Dessureault(4)	Independent	Financially Literate	Mr. Dessureault, 58, is a pharmaceutical executive. He is currently Chairman of Optina Diagnostic. He is the founding partner and president of the BioInnov Group, and a member of the management committee of the CHU Sainte-Justine formulation Centre. In addition, he is also a director of two private boards. Mr. Dessureault holds bachelor’s degree from l’Ecole des science de la gestion (ESG), a Master’s degree in Marketing Science from the Leicester University in the UK and is a Charted Administrator with a dual designation from Laval and McMaster University.
Adam Jaffe(5)	Independent	Financially Literate	Mr. Jaffe, 31, is a certified Public Accountant in the state of New York. He has extensive experience from his roles serving as the Chief Financial Officer of Legato Merger Corp., Allegro Merger Corp., Crescendo Partners, L.P. and Jamarant Capital, L.P.

Notes:

(1) A member of an audit committee is independent if the member has no direct or indirect material relationship with the Company that could, in the view of the Board of Directors, reasonably interfere with the exercise of a member’s independent judgment.

(2) An individual is financially literate if he has the ability to read and understand a set of financial statements that present a breadth of complexity of accounting issues that are generally comparable to the breadth and complexity of the issues that can reasonably be expected to be raised by the Company’s financial statements.

(3) Mr. Schnarr was appointed to the audit committee on January 24, 2022 and became the Chair of the audit committee on April 5, 2022.

(4) Mr. Dessureault was appointed to the audit committee on April 5, 2022.

(5) Mr. Jaffe was appointed to the audit committee on June 29, 2021.

Audit Committee Charter

A copy of the charter of the audit committee is available as Schedule “A” to this Annual Information Form.

Audit Committee Oversight

There have been no instances in 2021 where the Board did not adopt a recommendation of the Audit Committee to nominate or compensate an external auditor.

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Pre-Approval Policies and Procedures

The Audit Committee has not adopted specific policies and procedures for the engagement of nonaudit services, other than as set out in the audit committee charter.

External Auditor Service Fees (By Category)

The Audit Committee has reviewed the nature and amount of the audit services provided by KPMG LLP, the auditors of the Company, to the Company to ensure auditor independence. The aggregate fees billed by the Company’s external auditors during the financial years ended December 31, 2021 and December 31, 2020 were as follows:

Financial Period
	Audit Fees ($)(1)	Audit Related Fees ($)(2)	Tax Fees ($)(3)	All Other Fees ($)(4)
Ending
2020	$1,483,219	Nil	Nil	Nil
2021	$770,202	Nil	Nil	Nil

Notes:

(1) “Audit Fees” includes fees necessary to perform the annual audit of the Company’s financial statements. These services, including reviewing interim financial statements and disclosure documents related to financings and other attest services required by legislation or regulation, such as comfort letters, consents, reviews of securities filings and statutory audits.

(2) “Audit-Related Fees” include services that are traditionally performed by the auditor.

(3) “Tax Fees” include fees for all tax services other than those included in “Audit Fees” and “Audit-Related Fees”. This category includes fees for tax compliance, tax planning and tax advice. Tax planning and tax advice includes assistance with tax audits and appeals, tax advice related to mergers and acquisitions, and requests for rulings or technical advice from tax authorities.

(4) “All Other Fees” include all other non-audit services, the aggregate fees billed for products and services, other than the services reported under clauses (1), (2) and (3) above.

ADDITIONAL INFORMATION

Additional information relating to the Company is available under the Company’s profile on SEDAR at www.sedar.com and on the Company’s website at www.tgod.ca. Additional information, including directors’ and officers’ remuneration and indebtedness, principal holders of the Company’s securities, and securities authorized for issuance under equity compensation plans, will be contained in the Company’s information circular for its most recent annual meeting of security holders. Additional financial information is provided in the Company’s Audited Consolidated Financial Statements and Management’s Discussion and Analysis for the year ended December 31, 2021 and in the Management’s Discussion and Analysis for the fiscal quarters ending after that date, which are available for viewing under the Company’s profile on SEDAR.

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SCHEDULE A

CHARTER OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

I. MANDATE AND RESPONSIBILITIES

The audit committee is appointed by the board of directors (the “ Board ”) of the Green Organic Dutchman Holdings Ltd. (the “ Corporation ”) to oversee the accounting and financial reporting process of the Corporation and audits of the financial statements of the Corporation. The audit committee’s primary duties and responsibilities are to:

• a. recommend to the Board the external auditor to be nominated for the purpose of preparing or issuing an auditor’s report or performing other audit, review or attest services for the Corporation;

• b. recommend to the Board the compensation of the external auditor;

• c. oversee the work of the external auditor engaged for the purpose of preparing or issuing an auditor’s report or performing other audit, review or attest services for the Corporation, including the resolution of disagreements between management and the external auditor regarding financial reporting;

• d. pre-approve all non-audit services to be provided to the Corporation or its subsidiaries by the Corporation’s external auditor;

• e. review the Corporation’s financial statements, MD&A and annual and interim earnings press releases before the Corporation publicly discloses this information;

• f. be satisfied that adequate procedures are in place for the review of all other public disclosure of financial information extracted or derived from the Corporation’s financial statements, and to periodically assess the adequacy of those procedures;

• g. establish procedures for:

• i. the receipt, retention and treatment of complaints received by the Corporation regarding accounting, internal accounting controls or auditing matters; and

• ii. the confidential, anonymous submission by employees of the Corporation of concerns regarding questionable accounting or auditing matters; and

• h. review and approve the Corporation’s hiring policies regarding partners, employees and former partners and employees of the present and former external auditor of the Corporation.

The Board and management will ensure that the audit committee has adequate funding to fulfill its duties and responsibilities.

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II. PRE-APPROVAL OF NON-AUDIT SERVICES

The audit committee may delegate to one or more of its members the authority to pre-approve nonaudit services to be provided to the Corporation or its subsidiaries by the Corporation’s external auditor. The pre-approval of non-audit services must be presented to the audit committee at its first scheduled meeting following such pre-approval.

The audit committee may satisfy its duty to pre-approve non-audit services by adopting specific policies and procedures for the engagement of the non-audit services, provided the policies and procedures are detailed as to the particular service, the audit committee is informed of each non-audit service and the procedures do not include delegation of the audit committee’s responsibilities to management.

III. EXTERNAL ADVISORS

The audit committee has the authority to conduct any investigation appropriate to fulfilling its responsibilities, and it has direct access to the external auditors as well as anyone in the organization. The audit committee has the ability to retain, at the Corporation’s expense, special legal, accounting or other consultants or experts it deems necessary in the performance of its duties.

IV. EXTERNAL AUDITORS

The external auditors are ultimately accountable to the audit committee and the Board, as representatives of the shareholders. The external auditors will report directly to the audit committee. The audit committee will:

• a. review the independence and performance of the external auditors and annually recommend to the Board the nomination of the external auditors or approve any discharge of external auditors when circumstances warrant;

• b. approve the fees and other significant compensation to be paid to the external auditors;

• c. on an annual basis, review and discuss with the external auditors all significant relationships they have with the Corporation that could impair the external auditors’ independence;

• d. review the external auditors’ audit plan to see that it is sufficiently detailed and covers any significant areas of concern that the audit committee may have;

• e. before or after the financial statements are issued, discuss certain matters required to be communicated to audit committees in accordance with the standards established by the Chartered Professional Accountants of Canada;

• f. consider the external auditors’ judgments about the quality and appropriateness of the Corporation’s accounting principles as applied in the Corporation’s financial reporting;

• g. consider the external auditors’ judgments regarding any alternative treatments of financial information within generally accepted accounting principles that have been discussed with management, ramifications of the use of such alternative disclosures and treatments and the treatment preferred by the external auditors;

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• h. resolve any disagreements between management and the external auditors regarding financial reporting; and

• i. approve in advance all audit services and any non-prohibited non-audit services to be undertaken by the external auditors for the Corporation.

V. LEGAL COMPLIANCE

On at least an annual basis, the audit committee will review with the Corporation’s legal counsel any legal matters that could have a significant impact on the organization’s financial statements, the Corporation’s compliance with applicable laws and regulations and inquiries received from regulators or governmental agencies.

VI. COMPLAINTS

Individuals are strongly encouraged to approach a member of the audit committee with any complaints or concerns regarding accounting, internal accounting controls or auditing matters. The audit committee will from time to time establish procedures for the submission, receipt and treatment of such complaints and concerns. In all cases the audit committee will conduct a prompt, thorough and fair examination, document the situation and, if appropriate, recommend to the Board appropriate corrective action.

To the extent practicable, all complaints will be kept confidential. The Corporation will not condone any retaliation for a complaint made in good faith.