Phivida Holdings Inc.

==> picture [107 x 57] intentionally omitted <==

NOTICE OF ANNUAL GENERAL AND SPECIAL MEETING

AND

MANAGEMENT INFORMATION CIRCULAR

FOR THE

ANNUAL GENERAL AND SPECIAL MEETING OF SHAREHOLDERS

The board of directors of Phivida Holdings Inc., having received the recommendation of its special committee, unanimously recommends that the shareholders of Phivida Holdings Inc. vote FOR the Special Resolution.

These materials are important and require your immediate attention. They require shareholders of Phivida Holdings Inc. to make important decisions. If you are in doubt as to how to make such decisions, please contact your financial, legal, tax or other professional advisors. This document does not constitute an offer or a solicitation to any person in any jurisdiction in which such offer or solicitation is unlawful.

Neither the Canadian Securities Exchange nor any securities regulatory authority has, in any way, passed upon the merits of the transactions described in this management information circular.

PHIVIDA HOLDINGS INC.

422 Richards St., Suite 170 Vancouver, British Columbia V6B 2Z4, Canada

August 5, 2020

Dear Phivida Shareholder,

I write to you, on behalf of the board of directors (the “ Phivida Board ”) of Phivida Holdings Inc. (“ Phivida ” or the “ Company ”), to invite you to attend an annual general and special meeting (the “ Meeting ”) of the holders of common shares of Phivida (the “ Phivida Shareholders ”), to be held at the Holiday Inn Oakville, located at 590 Argus Road, Oakville, Ontario L6J 6G6 beginning at 10:00 a.m. (Eastern time) on September 4, 2020.

On June 2, 2020, Phivida entered into an arrangement agreement (the “ Arrangement Agreement ”) with Choom Holdings Inc. (“ Choom ”), pursuant to which Choom and Phivida will effect an arrangement (the “ Arrangement ”) pursuant to a plan of arrangement under Division 5 of Part 9 of the Business Corporations Act (British Columbia) (the “ Plan of Arrangement ”).

As a result of the Arrangement, among other things, all of the issued and outstanding common shares of Phivida (the “ Phivida Shares ”) will be acquired by Choom from Phivida Shareholders pursuant to the Arrangement, with Phivida Shareholders receiving 0.72566 of a common share of Choom (each whole share a “ Choom Share ”) for each Phivida Share held (the “ Consideration ”).

The Phivida Board, the special committee of the Phivida Board (the “ Special Committee ”) and management of Phivida believe that the consideration to be received by Phivida Shareholders is fair, from a financial point of view, and that the Arrangement is in the best interests of Phivida and its securityholders for the following reasons:

(a) Significant Premium to Phivida Shareholders. The exchange ratio at which the consideration offered by Choom was determined was based on the 20-day volumeweighted average trading prices of Phivida Shares (plus a 10% premium) and Choom Shares ending June 2, 2020 (being the trading day on which the Arrangement Agreement was entered into). Based on the closing price of the Phivida Shares on June 2, 2020, the Arrangement contemplates an implied premium of approximately 20% per Phivida Share.
(b) Enhance Choom’s Leadership Position in Cannabis Retail . If the Arrangement is completed, it is expected that the combined company will benefit from a vertically integrated strategy focused on cannabis retail and consumer experiences, by leveraging Choom’s current brick and mortar retail presence with Phivida’s digital assets and branded product expertise.
(c) Accelerate National Store Roll-out Program: If the Arrangement is completed, Choom will leverage Phivida’s current assets, to accelerate the build-out of additional stores in Ontario and British Columbia. The combined company will further benefit from its deep relationships with prominent landlords to support future store growth at marquee locations.
(d) Strengthen Choom’s Digital Strategy & Analytics: If the Arrangement is completed, Choom will leverage Phivida’s digital assets and capabilities to enhance growth and consumer experiences in its retail stores by utilizing Phivida’s e-commerce solutions and contentrich marketing platforms.
(e) Enhanced Scale and Access to Capital : If the Arrangement is completed, the combined company will benefit from enhanced capital markets presence and a broader shareholder group, with strengthened access to growth capital.
(f) Bolster Management Team with Added Capabilities and Broader Stakeholders: If the Arrangement is completed, the combined company will have blue-chip retail and branded product capabilities, digital and online expertise, countrywide geographical representation and an aligned entrepreneurial spirit committed to creating one of the dominant national cannabis retailers in Canada.
(g) More Recent Review of Alternatives. Since November 2019, Phivida has pursued and engaged with a number of parties that it believed would reasonably be expected to have an interest in acquiring, being acquired by, or combining with, Phivida. Prior to entering into the Arrangement Agreement, the Special Committee and the Phivida Board considered these parties and determined that it was unlikely any of those parties would be interested in making a proposal that could be superior to a potential transaction with Choom.
(h) Review of Alternative of Not Pursuing a Transaction . The Special Committee and the Phivida Board also considered whether Phivida pursuing its standalone business strategy would be preferable to the Arrangement Agreement. The Special Committee and the Phivida Board were concerned that pursuing its standalone business strategy would provide limited opportunities for growth in an increasingly competitive marketplace. The Special Committee and the Phivida Board concluded that the proposed transaction with Choom provided greater opportunities for Phivida and, in turn, greater value to Phivida Shareholders.
(i) Fairness Opinion. Haywood has provided an opinion to the Special Committee that, based upon and subject to certain assumptions, limitations and qualifications outlined in the opinion and such other matters as were considered relevant, the consideration to be received by the Phivida Shareholders in respect of the Arrangement is fair, from a financial point of view, to the Phivida Shareholders.
(j) Support of Phivida Directors, Officers and Shareholders. All of the directors and officers of Phivida, as well as certain other Phivida Shareholders, entered into the Support and Voting Agreements in which they each agreed, subject to the terms of their respective Support and Voting Agreements, to vote their Phivida Shares in favour of the Special Resolution. Such Phivida Shareholders own or exercise control or direction over an aggregate of 28,539,235 Phivida Shares or approximately 32% of the issued and outstanding Phivida Shares.
(k) Superior Proposal . Under the Arrangement Agreement, the Phivida Board remains able to respond to unsolicited Acquisition Proposals that would reasonably be expected to lead to a Superior Proposal, and that the termination payment payable to Choom in

connection with a termination of the Arrangement Agreement is reasonable in the circumstances and not preclusive of other offers.

For more information, see “ Information Concerning the Arrangement – Reasons for the Arrangement”, in the accompanying management information circular (the “ Circular ”). At the Meeting, you will be asked to consider (in addition to the usual annual meeting matters) and, if thought advisable, pass a special resolution (the “ Special Resolution ”) that will approve, among other things, the Plan of Arrangement, which is being proposed under the terms of the Arrangement Agreement as more particularly described in the Circular.

The Phivida Shareholders that will be entitled to receive notice of, to attend and to vote at the Meeting are the Phivida Shareholders of record on July 24, 2020.

THE SPECIAL COMMITTEE HAS, AFTER CONSULTATION WITH PHIVIDA’S OUTSIDE LEGAL COUNSEL AND FINANCIAL ADVISOR, AND AFTER RECEIVING THE OPINION OF HAYWOOD ON JUNE 2, 2020 (THE TEXT OF WHICH IS ATTACHED AS APPENDIX “F ” TO THE CIRCULAR) AS TO THE FAIRNESS, FROM A FINANCIAL POINT OF VIEW, TO THE PHIVIDA SHAREHOLDERS OF THE CONSIDERATION, UNANIMOUSLY DETERMINED THAT THE CONSIDERATION TO BE RECEIVED BY THE PHIVIDA SHAREHOLDERS IS FAIR, FROM A FINANCIAL POINT OF VIEW, AND THAT THE ARRANGEMENT IS IN THE BEST INTERESTS OF PHIVIDA AND ITS SECURITYHOLDERS AND THE PHIVIDA BOARD UNANIMOUSLY APPROVED THE ARRANGEMENT AND THE ARRANGEMENT AGREEMENT AND RECOMMENDS THAT THE PHIVIDA SHAREHOLDERS VOTE THEIR PHIVIDA SHARES IN FAVOUR OF THE SPECIAL RESOLUTION.

To be effective, the Special Resolution must be approved by a resolution passed by not less than two-thirds of the votes cast by the Phivida Shareholders present in person or represented by proxy at the Meeting. The directors and officers of Phivida intend to vote their Phivida Shares FOR the approval of the Special Resolution.

The attached notice of annual general and special meeting (the “ Notice ”) and Circular contain a detailed description of the Arrangement and include certain other information to assist you in considering the matters to be voted upon. You are urged to carefully consider all of the information in the accompanying Notice and Circular, including the documents incorporated by reference therein. If you require assistance, you should consult your financial, legal, or other professional advisors.

Your vote is important regardless of the number of Phivida Shares you own.

Voting

If you are not registered as the holder of your Phivida Shares and hold your Phivida Shares through a broker or other intermediary, you should follow the instructions provided by your broker or other intermediary to vote your Phivida Shares. See the section in the accompanying Circular entitled “ General Proxy Information — Non-Registered Holders ” for further information on how to vote your Phivida Shares.

If you are a registered Phivida Shareholder, you may vote by attending the Meeting in person or by completing the enclosed form of proxy. In light of ongoing concerns related to the spread of COVID-19, we encourage you not to plan to attend the Meeting in person and instead ensure you vote by proxy. Please read, complete, sign, date and return the enclosed form of proxy in accordance with the instructions set out therein and in the Circular. In order to be valid for use at the Meeting, proxies must be received by Computershare Investor Services Inc. at least 48 hours (excluding Saturdays, Sundays and

iii

holidays) prior to the time of the Meeting. Proxies may be submitted by mail or hand delivery to Computershare Investor Services Inc., Attention Proxy Department, 3[rd] Floor, 510 Burrard Street, Vancouver, B.C., V6C 3B9, by fax to 1-866-249-7775, or online. To vote by internet, please follow the online voting instructions provided on the form of proxy provided. Notwithstanding the foregoing, the Chairman of the Meeting has the sole discretion to accept proxies received after such deadline but is under no obligation to do so. Please vote as soon as possible.

Letter of Transmittal

If you are a registered Phivida Shareholder, we also encourage you to complete and return the enclosed Letter of Transmittal together with the certificate(s) and/or DRS Advice(s) representing your Phivida Shares and any other required documents and instruments, to the depositary, Computershare Investor Services Inc. (at its principal offices in Vancouver), in accordance with the instructions set out in the Letter of Transmittal so that, if the Arrangement is approved and the Plan of Arrangement is completed, the consideration for your Phivida Shares can be sent to you as soon as possible following the Plan of Arrangement becoming effective. The Letter of Transmittal contains other procedural information related to the Arrangement and should be reviewed carefully.

If you hold your Phivida Shares through a broker or other person, please contact that broker or other person for instructions and assistance in receiving Choom Shares in exchange for your Phivida Shares upon completion of the Plan of Arrangement.

Concerns and Restrictions Relating to COVID-19

While the Meeting will be held at a physical location and registered Phivida Shareholders may attend and vote at the Meeting (subject to applicable restrictions regarding public gatherings), in light of the ongoing novel coronavirus disease (COVID-19) pandemic, Phivida encourages Phivida Shareholders not to attend the Meeting in person, particularly if they are experiencing any of the described COVID-19 symptoms of fever, cough or difficulty breathing. Access to the Meeting will be limited to essential personnel and registered Phivida Shareholders and proxyholders entitled to attend and vote at the Meeting (subject to applicable restrictions regarding public gatherings). Phivida will adhere to current government direction and advice in respect of the Meeting. Accordingly, those attending in person will be required to comply with the then current direction and advice from federal, provincial and municipal levels of government concerning public gatherings. Phivida Shareholders should be advised that constantly evolving restrictions on the size of public gatherings are beyond the control of Phivida, and attendance at the Meeting in person may be difficult or not permitted. Accordingly, Phivida recommends that Phivida Shareholders vote by proxy.

Phivida reserves the right to take any additional precautionary measures deemed appropriate in relation to the Meeting in response to further developments in respect of the COVID-19 pandemic including, if considered necessary or advisable, adjourning or postponing the Meeting, or hosting the Meeting by means of remote communication. Changes to the Meeting date and/or means of holding the Meeting may be announced by way of news release. Please monitor our news releases as well as our website at www.phivida.com for updated information. We advise you to check our website at least one week prior to the Meeting date for any updated information. We do not intend to prepare or mail an amended Circular in the event of changes to the Meeting date and/or format.

While certain matters are beyond the control of Phivida, if the Special Resolution is passed by the requisite threshold of Phivida Shareholders at the Meeting, it is anticipated that the Plan of Arrangement will be completed and become effective by early September, 2020. However, given the uncertainty created by the current COVID-19 pandemic, it is possible that the completion of the Plan of Arrangement may be delayed beyond early September, 2020.

If you have any questions or require assistance with regard to the Letter of Transmittal, please contact Computershare Investor Services Inc. by toll-free telephone at 1-800-564-6253 or email at [email protected].

On behalf of Phivida, I would like to thank all our shareholders for their ongoing support.

Yours truly,

(signed) “David Moon”

Interim Chief Executive Officer and Director Phivida Holdings Inc.

PHIVIDA HOLDINGS INC. 422 Richards St., Suite 170, Vancouver, British Columbia V6B 2Z4, Canada

NOTICE OF ANNUAL GENERAL AND SPECIAL MEETING OF SHAREHOLDERS

NOTICE IS HEREBY GIVEN that an annual general and special meeting (the “ Meeting ”) of holders of common shares (the “ Phivida Shares ”) of Phivida Holdings Inc. (“ Phivida ” or the “ Company ”) will be held at the Holiday Inn Oakville, located at 590 Argue Road, Oakville, Ontario L6J 6G6 beginning at 10:00 a.m. (Eastern time) on September 4, 2020, for the following purposes:

to receive the Company’s audited financial statements as at and for the financial years ended September 30, 2019 and 2018;
to fix the number of directors of the Company at three (3) and to elect directors;
to appoint Baker Tilley WM LLP as the Company’s auditors and authorize the directors to fix their remuneration;
to consider, pursuant to an interim order (the “ Interim Order ”) of the Supreme Court of British Columbia (the “ Court ”) dated August 5, 2020, and, if deemed advisable, pass, with or without variation, a special resolution (the “ Special Resolution ”), the full text of which is attached as Appendix “A” to the management information circular of Phivida dated August 5, 2020 (the “ Circular ”), authorizing and approving, among other things, the arrangement (the “ Arrangement ”) under Division 5 of Part 9 of the Business Corporations Act (British Columbia), as more particularly set out in the Circular under the heading “ Information Concerning the Arrangement ”; and
to act upon such other matters as may properly come before the Meeting or any adjournment(s) or postponement(s) thereof.

The Circular contains the full text of the Special Resolution and provides additional information relating to the matters to be addressed at the Meeting, including the Arrangement, and is deemed to form part of this Notice.

Holders of Phivida Shares (“ Phivida Shareholders ”) are entitled to vote at the Meeting either in person (subject to applicable restrictions regarding public gatherings) or by proxy. Those attending the Meeting in person who are experiencing any of the described COVID-19 symptoms of fever, cough or difficulty breathing will not be permitted to attend the Meeting. Those attending in person will be required to comply with the then current direction and advice from federal, provincial and municipal levels of government concerning public gatherings. Note however that, in light of ongoing concerns related to the spread of COVID-19 and the constantly evolving restrictions on the size of public gatherings which are beyond the control of Phivida, attendance at the Meeting in person may be difficult or not permitted. Accordingly, we encourage you not to plan to attend the Meeting in person and instead ensure you vote by proxy. Please read, complete, sign, date and return the enclosed form of proxy (the “ Proxy ”) in accordance with the instructions set out in the Proxy and in the Circular. In order to be valid for use at the Meeting, proxies must be received by Computershare Investor Services Inc.

(“ Computershare ”) at least 48 hours (excluding Saturdays, Sundays and holidays) prior to the time of the Meeting. Proxies may be submitted by mail or hand delivery to Computershare, Attention Proxy Department, 3[rd] Floor, 510 Burrard Street, Vancouver, B.C., V6C 3B9, by fax to 1-866-249-7775, or online. To vote by internet, please follow the online voting instructions provided on the form of proxy provided. Notwithstanding the foregoing, the Chairman of the Meeting has the sole discretion to accept proxies received after such deadline but is under no obligation to do so. Please advise Computershare of any change in your mailing address.

If you are a non-registered Phivida Shareholder, please refer to the section in the Circular entitled “ General Proxy Information — Non-Registered Holders ” for information on how to vote your Phivida Shares.

Phivida reserves the right to take any additional precautionary measures deemed appropriate in relation to the Meeting in response to further developments in respect of the COVID-19 pandemic including, if considered necessary or advisable, adjourning or postponing the Meeting or hosting the Meeting solely by means of remote communication. Changes to the Meeting date and/or means of holding the Meeting may be announced by way of news release. Please monitor our news releases as well as our website at www.phivida.com for updated information. We advise you to check our website at least one week prior to the Meeting date for any updated information. We do not intend to prepare or mail an amended Circular in the event of changes to the Meeting date and/or format.

Take notice that registered Phivida Shareholders who validly dissent from the Special Resolution will, if the Arrangement becomes effective, be entitled to be paid by Phivida out of its separate assets, the fair value of the their Phivida Shares, subject to strict compliance with Sections 237 to 247 of the Business Corporations Act (British Columbia), as may be modified by the Interim Order, the final order of the Court pursuant to Section 291 of the Business Corporations Act (British Columbia) (the “ Final Order ”) and the plan of arrangement substantially in the form attached as Appendix “B” to the Circular (the “ Plan of Arrangement ”). The right to dissent is described in the Circular under the heading “ Rights of Dissenting Shareholders ”. Failure to strictly comply with the dissent procedures set out in Sections 237 to 247 of the Business Corporations Act (British Columbia), as may be modified by the Interim Order, the Final Order and the Plan of Arrangement, may result in the loss of any right of dissent.

Persons who are beneficial owners of Phivida Shares registered in the name of a broker, custodian, nominee or other intermediary who wish to dissent should be aware that only registered Phivida Shareholders are entitled to dissent. Accordingly, a beneficial owner of Phivida Shares desiring to exercise dissent rights must make arrangements for beneficially owned Phivida Shares to be registered in his, her or its name prior to the time written notice of dissent is required to be received by Phivida, or make arrangements for the registered holder to dissent on his, her or its behalf in accordance with the dissent provisions set out in Sections 237 to 247 of the Business Corporations Act (British Columbia), as may be modified by the Interim Order, the Final Order and the Plan of Arrangement.

Only Phivida Shareholders of record at the close of business on July 24, 2020 will be entitled to vote at the Meeting.

DATED at Toronto, Ontario, on August 5, 2020.

BY ORDER OF THE BOARD OF DIRECTORS

(signed) “David Moon”

Interim Chief Executive Officer and Director Phivida Holdings Inc.

QUESTIONS AND ANSWERS

Q:

Why is the Meeting being held?

A: At the Meeting, Phivida Shareholders will be asked to consider and to vote to approve the Special Resolution which, if passed, and if the Plan of Arrangement is completed, will result in (among other things), all of the issued and outstanding Phivida Shares being acquired by Choom in consideration of 0.72566 of a Choom Share for each Phivida Share.

Q:

When is the Meeting being held?

A: The Meeting is to be held on September 4, 2020 beginning at 10:00 a.m. (Eastern Time) at the Holiday Inn Oakville located at 590 Argue Road, Oakville, Ontario L6J 6G6.

Q:

Who is entitled to vote at the Meeting?

A: Only shareholders of record at the close of business on July 24, 2020 are entitled to receive notice of and vote at the Meeting.
Q: If I am a Phivida Shareholder what will I be voting on and what consideration will I receive for my Phivida Shares?
A: Phivida Shareholders will be voting on the Special Resolution (in addition to the usual annual meeting matters), the full text of which is attached to the Circular as Appendix “A”. If the Plan of Arrangement is completed, Phivida Shareholders will receive 0.72566 of a Choom Share for each Phivida Share held.

Q: When can I expect to receive the consideration for Phivida Shares?

A: The Consideration for the Phivida Shares will be delivered as soon as practicable following the Effective Date and after receipt by Computershare Investor Services Inc. of all required documents.

Q:

When do I have to vote my Phivida Shares by?

A: Proxies must be received by no later than 10:00 a.m. (Eastern time) on September 2, 2020, or, in the event that the Meeting is adjourned or postponed, 48 hours prior (excluding Saturdays, Sundays and holidays) before the time at which the adjourned or postponed Meeting is to begin.

Q: How do I vote my Phivida Shares?

A:

Registered Phivida Shareholders can vote in one of the following ways:
(i) Voting by Internet . A Registered Phivida Shareholder may submit his or her Proxy over the Internet by visiting the website address shown on the forms of proxy provided. Follow the online voting instructions given to you and vote over the Internet referring to your

holder account number and proxy access number provided on the forms of proxy that were delivered to you.

(ii) Voting by Telephone. To vote by telephone, call the toll-free number shown on the forms of proxy. Using a touch-tone telephone to select your voting preference, follow the instructions of the “vote choice” and refer to your holder account number and proxy access number provided on the forms of proxy that were delivered to you. Note that voting by telephone is not available if you wish to appoint a person as a proxyholder other than someone named on the forms of proxy.
(iii) Voting by Fax. A Registered Phivida Shareholder may vote by fax to 1-866-249-7775 (sending the pages of their completed, signed Proxy).
(iv) Voting by Mail or Hand Delivery. Enter voting instructions, sign the Proxy and send your completed Proxy to Computershare at 3rd Floor, 510 Burrard Street, Vancouver, B.C., V6C 3B9.

Registered Phivida Shareholders can also vote in person at the Meeting (subject to applicable restrictions regarding public gatherings). Those attending the Meeting in person who are experiencing any of the described COVID-19 symptoms of fever, cough or difficulty breathing will not be permitted to attend the Meeting. Those attending in person will be required to comply with the then current direction and advice from federal, provincial and municipal levels of government concerning public gatherings. Note however that, in light of ongoing concerns related to the spread of COVID-19 and the constantly evolving restrictions on the size of public gatherings which are beyond the control of Phivida, attendance at the Meeting in person may be difficult or not permitted. Accordingly, we encourage you not to plan to attend the Meeting in person and instead ensure you vote by proxy.

If you are a non-registered (i.e. beneficial) Phivida Shareholder, you are requested to complete and return the voting instruction form in accordance with the instructions provided therein. Alternatively, you can call the toll-free telephone number printed on your voting instruction form or go to the website printed on your voting instruction form and enter your control number to deliver your voting instructions.

Q: What are the benefits to Phivida Shareholders?

A: The exchange ratio at which the consideration offered by Choom was determined was based on the 20-day volume-weighted average trading prices of Phivida Shares (plus a 10% premium) and Choom Shares ending June 2, 2020 (being the trading day on which the Arrangement Agreement was entered into). Based on the closing price of the Phivida Shares on June 2, 2020, the Arrangement contemplates an implied premium of approximately 20% per Phivida Share. Additional benefits to Phivida Shareholders are outlined in “ Information Concerning the Arrangement – Reasons for the Arrangement ”.

Q: What approvals are required by Phivida Shareholders at the Meeting?

A: To be effective, the Special Resolution must be approved by a resolution passed by not less than two-thirds of the votes cast by the Phivida Shareholders present in person or represented by proxy at the Meeting voting together as a single class.

Q: Do Phivida’s directors support the Arrangement?

A: The Phivida Board unanimously recommends that Phivida Shareholders vote FOR the Special Resolution. Additionally, Haywood has provided an opinion to the Special Committee that, based upon and subject to certain assumptions, limitations and qualifications outlined in the opinion and such other matters as were considered relevant, the consideration to be received by the Phivida Shareholders in respect of the Arrangement is fair, from a financial point of view, to the Phivida Shareholders.

Q: Are there Support and Voting Agreements?

A: All of the directors and officers of Phivida, as well as certain Phivida Shareholders, have entered into support and voting agreements with Choom. As of the Record Date, such Phivida Shareholders own or exercise control or direction over an aggregate of 28,539,235 Phivida Shares or approximately 32% of the issued and outstanding Phivida Shares.

Q: Is there a Fairness Opinion?

A: A Fairness Opinion has been provided by Haywood. The Fairness Opinion is attached as Appendix “F” of this Circular.

Q: When will the Plan of Arrangement become effective?

A: The Plan of Arrangement will become effective on the Effective Date which is expected to occur by September 2020, provided that the Special Resolution is passed and all conditions and approvals required in respect of the Arrangement are met and received.

Q: Where will the shares of Choom be listed?

A: Shares of Choom will continue to be listed on the Canadian Securities Exchange (symbol:CHOO).

Q: Should I send in my Letter of Transmittal and certificate(s) or DRS Advice(s) representing by Phivida Shares now?

A: You are not required to send in your DRS Advice(s) and/or certificate(s) representing Phivida Shares to validly cast your vote in respect of the Special Resolution. We encourage Registered Phivida Shareholders to complete, sign, date and return the enclosed Letter of Transmittal, together with any Phivida share certificate(s) and/or DRS Advice(s), at least three Business Days prior to the Effective Date, which will assist in arranging for the prompt exchange of your shares if the Plan of Arrangement is completed.

iii

Q: Who do I contact if I have questions?

A: If you have any questions or need assistance completing your form of proxy, please contact Computershare at 1-800-564-6253. If you have any questions or need assistance completing your Letter of Transmittal, please contact Computershare Investor Services Inc. by toll-free telephone at 1-800-564-6253 or by email at [email protected].

INFORMATION CONTAINED IN THIS INFORMATION

CIRCULAR ................................................................ 1 Information Contained in this Circular Regarding Choom................................................................... 1 Cautionary Note Regarding Forward-Looking Statements and Risks ............................................ 1 Note to United States Security Holders ................ 3 Summary of Certain Canadian Federal Income Tax Considerations ...................................................... 5 Reporting Currency ............................................... 5 GLOSSARY OF TERMS .............................................. 5 GENERAL PROXY INFORMATION ........................... 16 Solicitation of Proxies ......................................... 16 Who can Vote? ................................................... 16 Registered Phivida Shareholders ........................ 16 Voting of Shares and Exercise of Discretion of Proxies ................................................................ 17 Non-Registered Holders ...................................... 18 Voting Shares and Principal Holders Thereof ..... 19 INFORMATION CONCERNING THE MEETING ......... 19 General Information ........................................... 19 Receipt of the Phivida Audited Financial Statements .......................................................... 20 Election of Directors of Phivida .......................... 20 Appointment of Auditors .................................... 22 Approval of the Special Resolution Regarding the Arrangement ....................................................... 23 Additional Business ............................................. 23

INFORMATION CONCERNING THE ARRANGEMENT .................................................... 24 Background to the Arrangement ........................ 24 Principal Steps of the Arrangement .................... 25 Effect of the Arrangement .................................. 26 Reasons for the Arrangement ............................. 27

Recommendation of the Special Committee and Phivida Board ...................................................... 29 Interests of Certain Persons in the Arrangement ....................................................... 30 Support and Voting Agreements ........................ 32 Fairness Opinion ................................................. 37 The Arrangement Agreement ............................. 38 Conduct of the Meeting and Other Approvals .... 51 Exchange of Phivida Shares................................. 51 Treatment of Phivida Options ............................. 53 Effective Date of Arrangement ........................... 53 Other Transactions.............................................. 53 Dissent Rights in Respect of the Arrangement ... 54 Risks Associated with the Arrangement ............. 54 Risks Related to Choom ...................................... 56 Certain Canadian Federal Income Tax Considerations .................................................... 56 Securities Laws and Considerations .................... 63 RIGHTS OF DISSENTING SHAREHOLDERS .............. 67 ADDITIONAL INFORMATION CONCERNING PHIVIDA ................................................................ 70 ADDITIONAL INFORMATION CONCERNING CHOOM ................................................................ 70 INTERESTS OF INFORMED PERSONS AND OTHERS IN MATERIAL TRANSACTIONS ................................... 71 INTERESTS OF CERTAIN PERSONS AND COMPANIES IN MATTERS TO BE ACTED UPON .......................... 71 AUDITORS AND TRANSFER AGENT ....................... 71 INTEREST OF EXPERTS .......................................... 71 OTHER MATTERS .................................................. 71 ADDITIONAL INFORMATION ................................. 72 APPROVAL OF BOARD .......................................... 72

Appendix “A” – Form of Special Resolution Appendix “B” – Plan of Arrangement Appendix “C” – Interim Order Appendix “D” – Notice of Hearing of Petition Appendix “E” – Dissent Provisions of the BCBCA Appendix “F” – Fairness Opinion Appendix “G” – Additional Information Concerning Phivida Schedule “1” – Audit Committee Charter Appendix “H” – Additional Information Concerning Choom Before and After the Arrangement Schedule “1” – Pro Forma Consolidated Financial Statements

INFORMATION CONTAINED IN THIS INFORMATION CIRCULAR

The information contained in this Circular, unless otherwise indicated, is given as of August 5, 2020.

No Person has been authorized to give any information or to make any representation in connection with the matters being considered herein other than those contained in this Circular and, if given or made, such information or representation should be considered or relied upon as not having been authorized. This Circular does not constitute an offer to sell, or a solicitation of an offer to acquire, any securities, or the solicitation of a proxy, by any Person in any jurisdiction in which such an offer or solicitation is not authorized or in which the Person making such offer or solicitation is not qualified to do so or to any Person to whom it is unlawful to make such an offer or proxy solicitation. Neither the delivery of this Circular nor any distribution of securities referred to herein will, under any circumstances, create any implication that there has been no change in the information set forth herein since the date of this Circular.

Information contained in this Circular should not be construed as legal, tax or financial advice and Phivida Shareholders are urged to consult their own professional advisors in connection with the matters considered in this Circular.

The Arrangement and the related securities described herein have not been registered with, recommended by or approved or disapproved by any securities regulatory authority, nor has any securities regulatory authority passed upon the fairness or merits of the Arrangement or upon the accuracy or adequacy of the information contained in this Circular and any representation to the contrary is unlawful.

Information Contained in this Circular Regarding Choom

The information concerning Choom, and its affiliates and the Choom Shares (other than with respect to information provided by Phivida) contained in this Circular (including all Choom documents filed by Choom with a securities commission or similar authority in Canada that are incorporated by reference herein) have been provided by Choom for inclusion in this Circular. In the Arrangement Agreement, Choom provided a covenant in favour of Phivida that it would promptly notify Phivida if, at any time before the Effective Date, it becomes aware that the Circular contains a misrepresentation, or that otherwise requires an amendment or supplement to the Circular. Although Phivida has no knowledge that would indicate that any statements contained herein relating to Choom, its affiliates or the Choom Shares (other than with respect to information provided by Phivida) are untrue or incomplete, neither Phivida nor any of its officers or directors assumes any responsibility for the accuracy or completeness of the information relating to Choom, its affiliates or the Choom Shares (other than with respect to information provided by Phivida), or for any failure by Choom to disclose facts or events that may have occurred or may affect the significance or accuracy of any such information but which are unknown to Phivida.

Cautionary Note Regarding Forward-Looking Statements and Risks

This Circular and the documents incorporated into this Circular by reference contain “forward-looking statements” and “forward-looking information” collectively referred to herein as “ forward looking statements ” within the meaning of the applicable Securities Laws that are based on expectations, estimates and projections as at the date of this Circular or the dates of the documents incorporated herein by reference, as applicable. These forward-looking statements include but are not limited to statements

and information concerning: the Arrangement; covenants of Phivida and Choom; the timing for the implementation of the Arrangement and the potential benefits of the Arrangement; the likelihood of the Arrangement being completed; principal steps of the Arrangement; statements relating to the business and future activities of, and developments related to, Phivida and Choom after the date of this Circular and prior to the Effective Time; Required Approval of the Arrangement; regulatory and court approval of the Arrangement; market position, and future financial or operating performance of Choom and Phivida; liquidity of Choom Shares following the Effective Time; anticipated developments in operations; currency fluctuations; requirements for additional capital; government regulation of the cannabis industry; limitations on insurance coverage; the timing and possible outcome of pending litigation in future periods; the timing and possible outcome of regulatory matters; goals; strategies; future growth; planned future acquisitions; the adequacy of financial resources; the availability of capital; statements regarding the Bridge Loan; and other events or conditions that may occur in the future.

Any statements that involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would”, “might”, or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements and are intended to identify forward-looking statements.

These forward-looking statements are based on the beliefs of Phivida’s management and, in the case of information concerning Choom, the management of Choom, as well as on assumptions, which each such respective management team believes to be reasonable in respect of the respective forward-looking statements concerning Phivida and Choom based on information currently available at the time such statements were made. However, there can be no assurance that the forward-looking statements will prove to be accurate. Such assumptions and factors include, among other things, the satisfaction of the terms and conditions of the Arrangement and the receipt of the required securityholder, court and regulatory approvals and consents.

By their nature, forward-looking statements are based on assumptions and involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Phivida or Choom to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-looking statements are subject to a variety of risks, uncertainties and other factors that could cause actual events or results to differ from those expressed or implied by the forward-looking statements, including, without limitation: the Arrangement Agreement may be terminated in certain circumstances; general business, economic, competitive, political, regulatory and social uncertainties, and in particular uncertainties relating to COVID-19; history of losses of Phivida and Choom; risks related to factors beyond the control of Phivida and Choom, including risks related to COVID-19; risks related to the ability to obtain adequate financing for planned activities; risks related to governmental regulations; risks related to unexpected regulatory change; currency fluctuations and risks associated with a fixed exchange ratio; influence of third party stakeholders; conflicts of interest; risks related to dependence on key individuals; risks related to the involvement of some of the directors and officers of Phivida and Choom with other companies; enforceability of claims; the ability to maintain adequate control over financial reporting; risks related to the Choom Shares and Phivida Shares, including price volatility due to events that may or may not be within such parties’ control, including risks related to COVID-19; disruptions or changes in the credit or securities markets; delays in obtaining governmental approvals or financing or in the completion of

planned activities; increased operating costs; litigation risks; risks relating to the possibility that more than 5% of Phivida Shareholders may exercise their dissent rights; global economic climate; dilution; regulatory risks; other uncertainties and risk factors set out in filings made by Choom and Phivida from time to time with Securities Authorities; and risks related to the ability to hold the Meeting and/or obtain the Final Order due to COVID-19 and otherwise complete the Arrangement. This list is not exhaustive of the factors that may affect any of the forward-looking statements of Phivida or Choom.

Forward-looking statements are statements about the future and are inherently uncertain. Actual results could differ materially from those projected in the forward-looking statements as a result of the matters set out or incorporated by reference in this Circular generally and certain economic and business factors, some of which may be beyond the control of Phivida and Choom. In addition, recent unprecedented events in the world economy and global financial and credit markets and due to COVID-19 have resulted in heightened market volatility and a contraction in debt and equity markets, which could have a particularly significant, detrimental and unpredictable effect on forward-looking statements. Some of the important risks and uncertainties that could affect forward-looking statements are described further under the headings “ Additional Information Concerning the Arrangement – Risks Associated with the Arrangement ”, “ Appendix “ G ” – Additional Information Concerning Phivida – Risk Factors ”, and “ Appendix “ H ” – Additional Information Concerning Choom Before and After the Arrangement – Risk Factors” , and in other documents incorporated by reference in this Circular. Neither Phivida nor Choom intend, and neither of them assume any obligation, to update any forward-looking statements, other than as required by applicable law. For all of these reasons, Phivida Shareholders should not place undue reliance on forward-looking statements.

Note to United States Security Holders

THE ARRANGEMENT AND THE SECURITIES TO BE ISSUED IN CONNECTION WITH THE PLAN OF ARRANGEMENT HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR SECURITIES REGULATORY AUTHORITIES IN ANY STATE IN THE UNITED STATES, NOR HAS THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES REGULATORY AUTHORITIES OF ANY STATE IN THE UNITED STATES PASSED UPON THE FAIRNESS OR MERITS OF THE ARRANGEMENT OR PLAN OF ARRANGEMENT OR UPON THE ADEQUACY OR ACCURACY OF THIS CIRCULAR. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

The Choom Shares to be received by Phivida Shareholders pursuant to the Arrangement have not been and will not be registered under the U.S. Securities Act or the Securities Laws of any state of the United States and will be issued and distributed, respectively, in reliance upon the exemption from registration provided by Section 3(a)(10) of the U.S. Securities Act and exemptions provided under the Securities Laws of each state of the United States in which Phivida Shareholders reside. Section 3(a)(10) of the U.S. Securities Act exempts from the general registration requirements under the U.S. Securities Act securities issued in exchange for one or more bona fide outstanding securities, or partly in such exchange and partly for cash, where the terms and conditions of the issuance and exchange are approved by a court of competent jurisdiction that is expressly authorized by Law to grant such approval, after a hearing upon the fairness of such terms and conditions of such issuance and exchange at which all persons to whom the securities will be issued in such exchange have the right to appear and receive timely notice thereof. The Court issued the Interim Order on August 5, 2020 and, subject to the approval of the Arrangement by the Phivida Shareholders, a hearing for the Final Order approving the Arrangement will be held at the Court House, 800 Smithe Street, Vancouver, British Columbia on September 9, 2020, at 9:45 a.m. (Vancouver time) or as soon thereafter as counsel may be heard. All Phivida Shareholders are entitled to

appear and be heard at this hearing. Accordingly, the Final Order, if granted by the Court after the Court considers the substantive and procedural fairness of the Arrangement to the Phivida Shareholders, will constitute a basis for the exemption from the registration requirements of the U.S. Securities Act pursuant to Section 3(a)(10) thereunder with respect to the Choom Shares to be issued in connection with the Arrangement. Prior to the hearing on the Final Order, the Court will be informed of this effect of the Final Order.

The Choom Shares to be received by Phivida Shareholders pursuant to the Arrangement will be freely tradable under the U.S. Securities Act, except by persons who are “affiliates” (as defined in Rule 144 under the U.S. Securities Act) of Choom after the Arrangement or were affiliates of Choom within 90 days prior to completion of the Arrangement. Any resale of such Choom Shares by such an affiliate (or, if applicable, former affiliate) may be subject to the registration requirements of the U.S. Securities Act, absent an exemption therefrom. Persons who may be deemed to be “affiliates” of an issuer include individuals or entities that control, are controlled by, or are under common control with, the issuer, whether through the ownership of voting securities, by contract, or otherwise, and generally include executive officers and directors of the issuer as well as principal shareholders of the issuer. Any resale of such Choom Shares by such an affiliate (or former affiliate) may be subject to the registration requirements of the U.S. Securities Act, absent an exemption therefrom. Phivida Shareholders in the United States who are affiliates of Choom solely by their status as an officer or director of Choom may sell their Choom Shares outside of the United States in compliance with Regulation S under the U.S. Securities Act. See “ Information Concerning the Arrangement– Securities Laws and Considerations – Resales of Choom Shares within the United States after the Completion of the Arrangement ”.

The solicitation of proxies made pursuant to this Circular is not subject to the requirements of Section 14(a) of the U.S. Exchange Act. Accordingly, this Circular has been prepared in accordance with disclosure requirements applicable in Canada, and the solicitations and transactions contemplated in this Circular are made in the United States for securities of a Canadian issuer in accordance with Canadian corporate and Securities Laws. Phivida Shareholders in the United States should be aware that such requirements are different from those of the United States applicable to registration statements under the U.S. Securities Act and to proxy statements under the U.S. Exchange Act.

The Choom financial statements incorporated by reference in this Circular have been prepared in accordance with International Financial Reporting Standards and are subject to Canadian auditor independence standards and thus may not be comparable to financial statements prepared in accordance with United States generally accepted accounting principles and auditor independence standards.

Phivida Shareholders who are resident in, or citizens of, the United States are advised to consult their own tax advisors to determine the particular United States tax consequences to them of the Arrangement in light of their particular situation, as well as any tax consequences that may arise under the laws of any other relevant foreign, state, local, or other taxing jurisdiction.

The enforcement by investors of civil liabilities under United States securities laws may be affected adversely by the fact that Phivida and Choom are incorporated or organized outside the United States, that some or all of Phivida’s and Choom’s respective officers and directors and the experts named herein are residents of a foreign country, and that all or a portion of the assets of Phivida and/or Choom and said persons are located outside the United States. As a result, it may be difficult or impossible for Phivida Shareholders in the United States to effect service of process within the United States upon Phivida or Choom, some or all of the respective officers or directors of Phivida or Choom or the experts named

herein, or to realize against Phivida and Choom upon judgments of courts of the United States predicated upon civil liabilities under the federal securities laws of the United States or “blue sky” laws of any state within the United States. In addition, Phivida Shareholders in the United States should not assume that the courts of Canada: (a) would enforce judgments of United States courts obtained in actions against such persons predicated upon civil liabilities under the federal securities laws of the United States or “blue sky” laws of any state within the United States; or (b) would enforce, in original actions, liabilities against such persons predicated upon civil liabilities under the federal securities laws of the United States or “blue sky” laws of any state within the United States.

United States Securities Laws matters are further described under the heading “ Information Concerning the Arrangement– S ecurities Laws and Considerations – U.S. Securities Laws ”. Information in this Circular or in the documents incorporated by reference herein concerning Choom and Phivida has been prepared in accordance with Canadian standards under applicable Canadian Securities Laws, which differ in material respects from the requirements of U.S. Securities Laws applicable to U.S. companies subject to the reporting and disclosure requirements of the SEC.

No broker, dealer, salesperson or other Person has been authorized to give any information or make any representation other than those contained in this Circular and, if given or made, such information or representation must not be relied upon as having been authorized by Phivida or Choom.

Summary of Certain Canadian Federal Income Tax Considerations

For a summary of certain material Canadian income tax consequences of the Arrangement, see “Certain Canadian Federal Income Tax Considerations”. Such summary is not intended to be legal or tax advice to any particular Phivida Shareholder.

Reporting Currency

Except as otherwise indicated in this Circular, references to “Canadian dollars” and “$” are to the currency of Canada, references to “U.S. dollars” or “US$” are to the currency of the United States.

GLOSSARY OF TERMS

In this Circular and Notice, unless there is something in the subject matter inconsistent therewith, the following terms will have the respective meanings set out below, words importing the singular number will include the plural and vice versa and words importing any gender will include all genders.

“ Acquisition Proposal ”

with respect to a Party means, other than the transactions contemplated by the Arrangement Agreement, any offer, proposal or inquiry (written or oral) from any Person or group of Persons (with respect to Phivida, other than Choom and/or one or more of its wholly-owned Subsidiaries, and with respect to Choom, other than Phivida and/or one or more of its whollyowned Subsidiaries) whether or not delivered to the shareholders of a Party, after the date of the Arrangement Agreement relating to:

(a) any sale or disposition (or any license, lease, long-term supply agreement or other arrangement having the same economic effect as a sale or disposition), direct or
6 -

indirect, of assets (including voting, equity or other securities of Subsidiaries) or joint venture, partnership or similar transaction representing 20% or more of the consolidated assets or contributing 20% or more of the consolidated revenue of such Party and its Subsidiaries, or of 20% or more of the voting or equity securities (or rights or interests in such voting or equity securities) of such Party or any of its Subsidiaries whose assets, individually or in the aggregate, represent 20% or more of the consolidated assets of such Party and its Subsidiaries;

(b) any take-over bid, exchange offer, issuance of securities or other transaction that, if consummated, would result in such Person or group of Persons beneficially owning or having the right to acquire 20% or more of any class of voting or equity securities of such Party on a fullydiluted basis;
(c) any plan of arrangement, merger, amalgamation, consolidation, share exchange, debt exchange, business combination, reorganization, joint venture, partnership or similar transaction, recapitalization, liquidation, dissolution or winding-up or similar transaction involving such Party or any of its Subsidiaries that, if consummated, would result in such Person or group of Persons beneficially owning 20% or more of the voting or equity securities of such Party or any of its Subsidiaries or of the surviving entity or the result direct or indirect parent of the surviving entity; or
(d) any other similar transaction or series of transactions involving such Party or any of its Subsidiaries.

“ Additional Shares ”

has the meaning ascribed to it under the heading “ Information Concerning the Arrangement– Support and Voting Agreements ”.

“ affiliate ”

“ Arrangement ”
“ Arrangement Agreement ”
“ BCBCA ”
“ Bridge Loan ”
“ Bridge Loan Warrants ”
“ Broadridge ”
“ Business Day ”

a Person is an “affiliate” of another Person if one of them is a Subsidiary of the other or each one of them is controlled, directly or indirectly, by the same Person. A “ Subsidiary ” means a Person that is controlled directly or indirectly by another Person and includes a Subsidiary of that Subsidiary. A Person is considered to “ control ” another Person if: (i) the first Person beneficially owns or directly or indirectly exercises control or direction over securities of the second Person carrying votes which, if exercised, would entitle the first Person to elect a majority of the directors of the second Person, unless that first Person holds the voting securities only to secure an obligation, or (ii) the second Person is a partnership, other than a limited partnership, and the first Person holds more than 50% of the interests of the partnership, or (iii) the second Person is a limited partnership, and the general partner of the limited partnership is the first Person.

means an arrangement under Part 9, Division 5 of the BCBCA, on the terms and subject to the conditions set out in the Plan of Arrangement, subject to any amendments or variations to the Plan of Arrangement made in accordance with the terms of the Arrangement Agreement and the provisions of the Plan of Arrangement or made at the direction of the Court in the Final Order with the prior written consent of Choom and Phivida, each acting reasonably.
means the arrangement agreement dated June 2, 2020 between Choom and Phivida, together with the Schedules attached thereto and disclosure letters delivered by each Party to the other Party, as the same may be amended, supplemented or otherwise modified from time to time in accordance with the terms thereof, a copy of which is available on SEDAR at www.sedar.com under each of Phivida’s and Choom’s respective SEDAR profile.
means the Business Corporations Act (British Columbia) and the regulations made thereunder, as now in effect and as they may be promulgated or amended from time to time.
has the meaning ascribed to it under the heading “ Information Concerning the Arrangement – Other Transactions ”.
has the meaning ascribed to it under the heading “ Information Concerning the Arrangement – Other Transactions ”.
has the meaning ascribed to it under the heading “ General Proxy Information – Non-Registered Holders ”.
means any day of the year, other than a Saturday, Sunday or any day on which major banks are closed for business in Toronto, Ontario or Vancouver, British Columbia.
8 -
“ CDS ”

“ Change in Recommendation ”

“ Choom ”
“ Choom Board ”
“ Choom Shares ”
“ Choom Shareholders ”
“ Circular ”
“ Competing Transaction ”
“ Computershare ”
“ Consideration ”

“ Consideration Shares ”

means the Canadian Depository for Securities.

has the meaning ascribed to it under the heading “ Information Concerning the Arrangement – The Arrangement Agreement – Termination of the Arrangement Agreement ”.

means Choom Holdings Inc., a corporation existing under the laws of the Province of British Columbia.

means the board of directors of Choom, as constituted from time to time.

means common shares in the authorized share structure of Choom.

means the holders of the Choom Shares, from time to time.

means this management information circular of Phivida dated August 5, 2020.
means any unsolicited bona fide written Acquisition Proposal from a Person who is an arm’s length third party made after the date of the Arrangement Agreement: (i) to acquire all of the outstanding Choom Shares not beneficially owned by such arm’s length third party or all or substantially all of the assets of Choom on a consolidated basis: (ii) that complies with Securities Laws in all material respects and did not result from or involve a breach of the non-solicitation provisions in the Arrangement Agreement; (iii) that is reasonably capable of being completed without undue delay relative to the Arrangement, taking into account all financial, legal, regulatory and other aspects of such proposal and the Person making such proposal; (iv) that is not subject to any financing condition and, in respect of which, adequate arrangements have been made to ensure that the required funds or other consideration will be available to effect payment in full for all of the Choom Shares or assets, as the case may be; (v) is not subject to any due diligence or access condition; and (vi) that is conditional upon Choom not proceeding with the Arrangement.
means Computershare Investor Services Inc. as registrar and transfer agent of the Phivida Shares.
means the consideration to be received by Phivida Shareholders pursuant to the Plan of Arrangement as consideration for their Phivida Shares, consisting of 0.72566 of a Choom Share for each Phivida Share, subject to adjustment in the manner and in the circumstances contemplated in Section 2.10 of the Arrangement Agreement, on the basis set out in the Plan of Arrangement.
means the Choom Shares to be issued as the Consideration pursuant to the Arrangement.
9 -

“ Court ”

“ CSE ”
“ Debenture Right ”
“ Depositary ”
“ Dissent Procedures ”
“ Dissent Rights ”
“ Dissenting Shareholder ”
“ D&O Support and Voting Agreements ”
“ DRS Advices ”

“DTC”

“ Effective Date ”
“ Effective Time ”

“ Fairness Opinion ”

means the Supreme Court of British Columbia.

means the Canadian Securities Exchange.

means the commencement of proceedings to enforce the rights of the holder of that certain debenture of Choom originally issued in the principal amount of $20,000,000 and, for greater certainty, shall not include providing notice of Choom that Choom is in default or breach of the terms of such debenture.

means Computershare Investor Services Inc.
has the meaning ascribed to it under the heading “ Rights of Dissenting Shareholders ”.
means the rights of Registered Phivida Shareholders to dissent from the Arrangement and receive fair value for their Phivida Shares granted to Registered Phivida Shareholders in the Interim Order and the Plan of Arrangement, as set out in Sections 237 to 247 of the BCBCA, as may be modified by the Interim Order, the Final Order and the Plan of Arrangement, as more particularly described under the heading “ Rights of Dissenting Shareholders ”.
has the meaning ascribed to it under the heading “ Rights of Dissenting Shareholders ”.
has the meaning ascribed to it under the heading “ Information Concerning the Arrangement– Support and Voting Agreements ”.
means the Direct Registration System advice statements representing Phivida Shares and/or the Choom Shares that a Registered Phivida Shareholder is entitled to receive under the Arrangement.

means the Depository Trust Company.

means the date upon which the Plan of Arrangement becomes effective.
means the time that the Plan of Arrangement becomes effective on the Effective Date.
means an opinion dated June 2, 2020 of Haywood to the effect that, as of the date of such opinion, the Consideration to be received by Phivida Shareholders is fair, from a financial point of view, to such holders, a copy of which is attached as Appendix “F” to this Circular.
10 -

“ Final Order ”

“ Governmental Entity ”

“ Haywood ”
“ Holder Shares ”
“ IFRS ”
means the final order of the Court made pursuant to Section 291 of the BCBCA, after a hearing upon the fairness of the terms and conditions of the Arrangement and after being informed of the intention to rely upon the Section 3(a)(10) Exemption from registration under the U.S. Securities Act in connection with the issuance of the Consideration and Replacement Options to Phivida Shareholders and Phivida Optionholders in the United States, in a form acceptable to Phivida and Choom, each acting reasonably, approving the Arrangement, as such order may be amended by the Court (with the consent of both Phivida and Choom, each acting reasonably) at any time prior to the Effective Date or, if appealed, then, unless such appeal is withdrawn or dismissed, as affirmed or as amended (provided that any such amendment is acceptable to Phivida and Choom, each acting reasonably) on appeal.
means (i) any international, multinational, national, federal, provincial, state, regional, municipal, local or other government, governmental or public department, central bank, court, tribunal, arbitral body, commission, commissioner, board, bureau, ministry, agency or instrumentality, domestic or foreign, (ii) any subdivision or authority of any of the above, (iii) any quasi-governmental or private body exercising any regulatory, expropriation or taxing authority under or for the account of any of the foregoing or (iv) any stock exchange, including the CSE.
means Haywood Securities Inc., financial advisor to the Special Committee.
has the meaning ascribed to it under the heading “ Information Concerning the Arrangement – Support and Voting Agreements ”.
means International Financial Reporting Standards, as issued by the International Accounting Standards Board, applicable as at the date on which the calculation is made or required to be made, applied on a consistent basis.
11 -

“ Interim Order ”

“ Intermediary ”

“ Law ” or “ Laws ”

“ Letter of Transmittal ”

“Material Adverse Effect ”

means the interim order of the Court contemplated by Section 2.2 of the Arrangement Agreement and made pursuant to Section 291 of the BCBCA after being informed of the intention to rely upon the Section 3(a)(10) Exemption from registration under the U.S. Securities Act in connection with the issuance of the Consideration and Replacement Options to Phivida Shareholders and Phivida Optionholders in the United States, in a form acceptable to Phivida and Choom, each acting reasonably, providing for, among other things, the calling and holding of the Meeting, as such order may be amended by the Court with the consent of Phivida and Choom, each acting reasonably.
has the meaning ascribed to it under the heading “ General Proxy Information – Non-Registered Holders ”.
means, with respect to any Person, any and all applicable law (statutory, common or otherwise), constitution, treaty, convention, ordinance, code, rule, regulation, order, injunction, notice, judgment, decree, ruling or other similar requirement, whether domestic or foreign, enacted, adopted, promulgated or applied by a Governmental Entity that is binding upon or applicable to such Person or its business, undertaking, property or securities, and to the extent that they have the force of law, policies, guidelines, notices and protocols of any Governmental Entity, as amended.
means the letter of transmittal delivered by Phivida to Phivida Shareholders together with this Circular for use in connection with the Arrangement.
means, in respect of any Party, as applicable, any change, event, occurrence, effect or circumstance that, individually or in the aggregate with other changes, events, occurrences, effects or circumstances, is or could reasonably be expected to be material and adverse to the business, operations, results of operations, assets, properties, capitalization, financial condition, liabilities (contingent or otherwise) or cash flows of a Party and its Subsidiaries, taken as a whole, except any such change, event, occurrence, effect, or circumstance resulting from or arising in connection with:
(a) any change generally affecting the industries in which the Party and its Subsidiaries operate;
(b) any change in general economic, business, regulatory, political or market conditions or in financial or capital markets in Canada and the United States;
(c) any adoption, proposal, implementation or change in Law or any interpretation of Law by any Governmental
12 -

Entity;

(d) any change in IFRS;
(e) any act of terrorism or any outbreak of hostilities or war (or any escalation or worsening thereof);
(f) any natural disaster, outbreaks of illness or other acts of God;
(g) any change in the market price or trading volume of any securities of the Party (provided, however, that the causes underlying such failure may be considered to determine whether such causes constitute a Material Adverse Effect);
(h) the failure of the Party to meet any internal or published projections, forecasts or estimates of revenues, earnings or cash flow for any period ending on or after the date of the Arrangement Agreement (provided, however, that the causes underlying such failure may be considered to determine whether such causes constitute a Material Adverse Effect);
(i) the announcement of the Arrangement Agreement or the transactions contemplated thereby; or
(j) any action taken by the Party or any of its Subsidiaries which is required to be taken pursuant to the Arrangement Agreement,

provided, however, that with respect to clauses (a) through to and including (f), such matter does not have a materially disproportionate effect on the Party and its Subsidiaries, taken as a whole, relative to other comparable companies and entities operating in the industries in which the Party and its Subsidiaries operate.

“ Meeting ”

“MI 61-101”

“ NI 54-101 ”

“ NOBO ”
“ Non-Registered Holders ”

means the annual general and special meeting of Phivida Shareholders to be held at the Holiday Inn Oakville, located at 590 Argus Road, Oakville, Ontario L6J 6G6 beginning at 10:00 a.m. (Eastern time) on September 4, 2020, or any postponement or adjournment thereof.

means Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions.

means National Instrument 54-101 – Communications with Beneficial Owners of Securities of a Reporting Issuer.

has the meaning ascribed to it under the heading “ General Proxy Information – Non-Registered Holders ”.

13 -

“ Notice ”

“ Notice of Dissent ”

“ Notice Shares ”
“ OBO ”
“ Outside Date ”
“ Parties ”
“ Person ”
“ Phivida ”
“ Phivida Board ”
“ Phivida Option Plan ”
“ Phivida Options ”
“ Phivida Shareholders ”
“ Phivida Shares ”
“ Plan of Arrangement ”
“ Proxy ”
“Proxy Solicitation Materials ”

means the accompanying notice of annual general and special meeting of Phivida Shareholders.

has the meaning ascribed to it under the heading “ Rights of Dissenting Shareholders ”.

has the meaning ascribed to it under the heading “ Rights of Dissenting Shareholders ”.
has the meaning ascribed to it under the heading “ General Proxy Information – Non-Registered Holders ”. means September 30, 2020, or such later date as may be agreed to in writing by the Parties.
means, collectively, Phivida and Choom and “ Party ” means any one of them.
includes any individual, partnership, association, body corporate, organization, trust, estate, trustee, executor, administrator, legal representative, government (including Governmental Entity), syndicate or other entity, whether or not having legal status.
means Phivida Holdings Inc., a corporation existing under the laws of the Province of British Columbia.
means the board of directors of Phivida, as constituted from time to time.
means the share option plan approved by Phivida Shareholders on March 21, 2019.
means the outstanding options to purchase Phivida Shares issued pursuant to the Phivida Option Plan.
means the registered or beneficial holders of Phivida Shares, as the context requires.
means the common shares in the authorized share structure of Phivida.
means the plan of arrangement substantially in the form attached as Appendix “B” to this Circular, subject to any amendments or variations to such plan made in accordance with Section 8.1 of the Arrangement Agreement or Section 6.1 of the Plan of Arrangement, or made at the direction of the Court in the Final Order with the prior written consent of Phivida and Choom, each acting reasonably.
has the meaning ascribed to it under the heading “ General Proxy Information – Registered Phivida Shareholders – Appointment and Revocation of Proxies ”
has the meaning ascribed to it under the heading “ General Proxy Information – Non-Registered Holders ”.
14 -
“ Record Date ”
“ Registered Phivida Shareholders ”
“ Regulation S ”
“ Replacement Option ”
“ Representatives ”
“ Required Approval ”
“ SEC ”
“ Section 3(a)(10) Exemption
“ Securities Authorities ”
“ Securities Laws ”

means July 24, 2020.

means a registered holder of Phivida Shares as recorded in the shareholder register of Phivida maintained by Computershare.

means Regulation S under the U.S. Securities Act.

has the meaning ascribed to it under the heading “ Information Concerning the Arrangement – Treatment of Phivida Options” .

has the meaning ascribed to it under the heading “ Information Concerning the Arrangement– The Arrangement Agreement – Covenants – Additional Covenants Regarding Non-Solicitation ”.

means the requisite approval for the Special Resolution, which shall be not less than two-thirds of the votes cast by the Phivida Shareholders present in person or represented by proxy at the Meeting voting together as a single class.

means the United States Securities and Exchange Commission.

Means the exemption from the registration requirements of the U.S. Securities Act provided by Section 3(a)(10) thereof.

means the British Columbia Securities Commission and the applicable securities commission or securities regulatory authority of each of the other provinces and territories of Canada.

means (a) the Securities Act (British Columbia) and any other applicable provincial securities Laws, (b) the U.S. Securities Act and the U.S. Exchange Act, to the extent applicable, and (c) the rules and regulations of the CSE.

“ Shareholder Support and Voting has the meaning ascribed to it under the heading “ Information Agreements ” Concerning the Arrangement– Support and Voting Agreements ”.

“Special Committee ”

means the special committee of the Phivida Board.

“ Special Resolution ” means the special resolution of the Phivida Shareholders approving, among other things, the Plan of Arrangement to be considered at the Meeting, the full text of which is attached as Appendix “A” to this Circular.

“ Subject Securities ” has the meaning ascribed to it under the heading “ Information Concerning the Arrangement – Support and Voting Agreements ”.
“ Support and Voting Agreements ” has the meaning ascribed to it under the heading “ Information Concerning the Arrangement – Support and Voting Agreements ”.
15 -

“ Supporting Shareholders ”

“ Superior Proposal ”

“ Termination Fee ”

“ U.S. Exchange Act ”

“ U.S. Securities Act ”

“VIF”

has the meaning ascribed to it under the heading “ Information Concerning the Arrangement – Support and Voting Agreements ”.

means any unsolicited bona fide written Acquisition Proposal from a Person who is an arm’s length third party made after the date of the Arrangement Agreement: (i) to acquire all of the outstanding Phivida Shares not beneficially owned by such arm’s length third party or all or substantially all of the assets of Phivida on a consolidated basis; (ii) that complies with Securities Laws in all material respects and did not result from or involve a breach of Article 5 of the Arrangement Agreement; (iii) that is reasonably capable of being completed without undue delay relative to the Arrangement, taking into account all financial, legal, regulatory and other aspects of such proposal and the Person making such proposal; (iv) that is not subject to any financing condition and in respect of which adequate arrangements have been made to ensure that the required funds or other consideration will be available to effect payment in full for all of the Phivida Shares or assets, as the case may be; (v) that is not subject to any due diligence or access condition; and (vi) that the Phivida Board determines, in its good faith judgment, after receiving the advice of its outside legal and financial advisors and after taking into account all the terms and conditions of the Acquisition Proposal, including all legal, financial, regulatory and other aspects of such Acquisition Proposal and the party making such Acquisition Proposal, would, if consummated in accordance with its terms, but without assuming away the risk of non-completion, result in a transaction which is more favourable, from a financial point of view, to Phivida Shareholders than the Arrangement (including any amendments to the terms and conditions of the Arrangement (including any amendments to the terms and conditions of the Arrangement proposed by Choom pursuant to Section 5.4(2) of the Arrangement Agreement).

means $500,000.

means the United States Securities Exchange Act of 1934 , as amended and the rules and regulations promulgated thereunder.

means the United States Securities Act of 1933 , as amended and the rules and regulations promulgated thereunder.

means a voting instruction form.

16 -

GENERAL PROXY INFORMATION

Solicitation of Proxies

This Circular is furnished in connection with the solicitation of proxies by the management of Phivida for use at the Meeting, to be held on September 4, 2020, at the time and place and for the purposes set forth in the accompanying Notice, or any postponement or adjournment thereof. While it is expected that the solicitation will be primarily by mail, proxies may be solicited personally, by telephone or by other means by the directors, officers and employees of Phivida. In addition, Phivida may engage a proxy solicitation agent to solicit proxies for the Meeting from brokers, banks and other institutional holders and from beneficial owners and individual holders of record of Phivida Shares. In the event Phivida engages such proxy solicitation services, Phivida anticipates that the services would be provided at a standard fee and on other typical commercial terms. All costs of solicitation will be borne by Phivida. None of the directors of Phivida have advised that they intend to oppose any action intended to be taken by management as set forth in this Circular.

Who can Vote?

If you are a Registered Phivida Shareholder as at July 24, 2020, you are entitled to attend at the Meeting (subject to applicable restrictions regarding public gatherings) and cast a vote for each Phivida Share registered in your name. If the Phivida Shares are registered in the name of a corporation, a duly authorized officer of such corporation may attend on its behalf, but documentation indicating such officer’s authority should be presented at the Meeting. If you are a Registered Phivida Shareholder but do not wish to, or cannot, attend the Meeting in person you can appoint someone who will attend the Meeting and act as your proxy holder to vote in accordance with your instructions. It is important that your Phivida Shares be represented at the Meeting regardless of the number of Phivida Shares you hold. Those attending the Meeting in person who are experiencing any of the described COVID-19 symptoms of fever, cough or difficulty breathing will not be permitted to attend the Meeting. Those attending in person will be required to comply with the then current direction and advice from federal, provincial and municipal levels of government concerning public gatherings. Note however that, in light of ongoing concerns related to the spread of COVID-19 and the constantly evolving restrictions on the size of public gatherings which are beyond the control of Phivida, attendance at the Meeting in person may be difficult or not permitted. Accordingly, we encourage you not to plan to attend the Meeting in person and instead ensure you vote by proxy. Please complete, date, sign and return your form of proxy as soon as possible so that your Phivida Shares will be represented.

If your Phivida Shares are registered in the name of a “nominee” (usually a bank, trust company, securities dealer or other financial institution) through CDS or DTC, you should refer to the section entitled “ Non-Registered Holders ” set out below.

Registered Phivida Shareholders

Appointment and Revocation of Proxies

The persons named in the accompanying form of proxy (the “ Proxy ”) are directors, officers or appointees of Phivida.

A REGISTERED PHIVIDA SHAREHOLDER HAS THE RIGHT TO APPOINT A PERSON (WHO NEED NOT BE A PHIVIDA SHAREHOLDER) TO ATTEND AND ACT FOR HIM, HER OR IT ON HIS, HER OR ITS BEHALF AT THE

17 -

MEETING OTHER THAN THE PERSONS NAMED IN THE ENCLOSED INSTRUMENT OF PROXY. TO EXERCISE THIS RIGHT, A REGISTERED PHIVIDA SHAREHOLDER MUST STRIKE OUT THE NAMES OF THE PERSONS NAMED IN THE INSTRUMENT OF PROXY AND INSERT THE NAME OF HIS, HER OR ITS NOMINEE IN THE BLANK SPACE PROVIDED, OR COMPLETE ANOTHER INSTRUMENT OF PROXY. IF YOU APPOINT A NON-MANAGEMENT PROXYHOLDER, PLEASE MAKE THEM AWARE AND ENSURE THAT THEY WILL ATTEND AND VOTE AT THE MEETING IN ORDER FOR THE VOTE TO COUNT. A PROXY WILL NOT BE VALID UNLESS IT IS DEPOSITED WITH PHIVIDA’S REGISTRAR AND TRANSFER AGENT, COMPUTERSHARE, BY MAIL OR HAND DELIVERY, TO COMPUTERSHARE AT 3RD FLOOR, 510 BURRARD STREET, VANCOUVER, B.C., V6C 3B9, BY FAX AT 1-866-249-7775, BY TELEPHONE OR VIA THE INTERNET BY FOLLOWING THE INSTRUCTIONS FOUND ON THE FORM OF PROXY, IN EACH CASE, NOT LESS THAN 48 HOURS (EXCLUDING SATURDAYS, SUNDAYS AND HOLIDAYS) BEFORE THE TIME OF THE MEETING OR ANY ADJOURNMENT OR POSTPONEMENT THEREOF. NOTWITHSTANDING THE FOREGOING, THE CHAIRMAN OF THE MEETING MAY WAIVE OR EXTEND THE TIME LIMIT FOR DEPOSIT AT HIS OR HER DISCRETION, WITHOUT NOTICE.

The Proxy must be signed and dated by the Phivida Shareholder or by his or her attorney in writing, or, if the Phivida Shareholder is a corporation, it must either be under its common seal or signed by a duly authorized officer. Only Registered Phivida Shareholders have the right to revoke a proxy. Non-Registered Holders (as defined below) under “Non-Registered Holders” may revoke their voting instructions before they are acted on. To revoke your voting instructions, send new instructions to your broker or intermediary prior to their cut off time. The latest instructions that were timely submitted will be the only valid instructions.

A Registered Phivida Shareholder who has given a proxy may revoke it at any time before it is exercised by depositing an instrument in writing, including another completed form of proxy, executed by such Registered Phivida Shareholder or by his or her attorney authorized in writing or by electronic signature or, if the Registered Phivida Shareholder is a corporation, by an authorized director, officer or attorney thereof, or by transmitting by telephone or electronic means, a revocation signed, subject to the BCBCA, by electronic signature, to Computershare at any time up to and including the last business day preceding the day of the Meeting or any adjournment or postponement thereof, at which the proxy is to be used, or with the Chair of the Meeting prior to the commencement of the Meeting on the day of the Meeting or any adjournment or postponement thereof or by any other manner permitted by law.

Voting of Shares and Exercise of Discretion of Proxies

On any poll, the persons named in the Proxy will vote the Phivida Shares in respect of which they are appointed. Where directions are given by the Registered Phivida Shareholder in respect of voting for or against any resolution, the Proxy holder will do so in accordance with such direction.

IN THE ABSENCE OF ANY INSTRUCTION IN THE PROXY, IT IS INTENDED THAT SUCH PHIVIDA SHARES WILL BE VOTED IN FAVOUR OF THE SPECIAL RESOLUTION AND FOR AND IN FAVOUR OF THE ANNUAL MEETING MATTERS . The instrument of Proxy enclosed, when properly signed, confers discretionary authority to the proxyholder with respect to amendments or variations to the matters which may properly be brought before the Meeting or any postponement or adjournment thereof. At the time of printing this Circular, the management of Phivida is not aware that any such amendments, variations or other matters are to be presented for action at the Meeting. However, if any other matters which are not now known to the management should properly come before the Meeting, the proxies hereby solicited will be voted on such matters in accordance with the best judgment of the proxyholder.

18 -

Non-Registered Holders

The information set forth in this section is of significant importance to many Phivida Shareholders as a substantial number of Phivida Shareholders do not hold Phivida Shares in their own name.

Only Registered Phivida Shareholders or duly appointed proxyholders are permitted to vote at the Meeting. Most Phivida Shareholders are “ Non-Registered Holders ” because the securities they own are not registered in their names but are instead registered in the name of the brokerage firm, bank or trust company through which they purchased their securities. In addition, a person is not a Registered Phivida Shareholder in respect of securities which are held on behalf of that person but which are registered either: (a) in the name of an intermediary (an “ Intermediary ”) that the Non-Registered Holder deals with in respect of its Phivida Shares (Intermediaries include, among others, banks, trust companies, securities dealers or brokers and trustees or administrators of self-administered RRSPs, RRIFs, RESPs and similar plans); or (b) in the name of a clearing agency (such as CDS Clearing and Depository Services Inc.) of which the Intermediary is a participant. In accordance with the requirements of NI 54-101, Phivida has distributed copies of the Notice, this Circular and the instruments of proxy (collectively, the “ Proxy Solicitation Materials ”) to the clearing agencies and Intermediaries for onward distribution to Non-Registered Holders. Intermediaries are required to forward the Proxy Solicitation Materials to Non-Registered Holders unless a Non-Registered Holder has waived the right to receive them under NI 54-101. Very often, Intermediaries will use service companies, such as Broadridge Financial Solutions Inc. (“ Broadridge ”), to forward the Proxy Solicitation Materials to Non-Registered Holders.

Generally, Non-Registered Holders will either:

(a) be given a form of proxy which has already been signed by the Intermediary (typically by facsimile, stamped signature), which is restricted as to the number of securities beneficially owned by the Non-Registered Holder but which is otherwise incomplete. Because the Intermediary has already signed the form of proxy, this form of proxy is not required to be signed by the Non-Registered Holder when submitting the Proxy. In this case, the Non-Registered Holder who wishes to submit a proxy should otherwise properly complete the form of proxy and deposit it with Computershare, as provided above; or
(b) more typically, be given a VIF which is not signed by the Intermediary, and which when properly completed and signed by the Non-Registered Holder and returned to the Intermediary or its service company (such as Broadridge), will constitute voting instructions (often called a “proxy authorization form”) which the Intermediary must follow. Typically, the proxy authorization form will consist of a one page pre-printed form. In the alternative, instead of the one page pre-printed form, the proxy authorization form will consist of a regular printed proxy form accompanied by a page of instructions which contains a removable label containing a bar-code and other information. In order for the form of proxy to validly constitute a proxy authorization form, the Non-Registered Holder must remove the label from the instructions and affix it to the form of proxy, properly complete and sign the form of proxy and return it to the Intermediary or its service company in accordance with the instructions of the Intermediary or its service company.

In either case, the purpose of this procedure is to permit Non-Registered Holders to direct the voting of Phivida Shares which they beneficially own. Although Non-Registered Holders may not be recognized directly at the Meeting for the purpose of voting Phivida Shares registered in the name of their broker,

19 -

agent or nominee, a Non-Registered Holder may attend the Meeting as a proxy holder for a Registered Phivida Shareholder and vote in that capacity. Non-Registered Holders who wish to attend the Meeting and indirectly vote their Phivida Shares as proxy holder for the Registered Phivida Shareholder should contact their broker, agent or nominee well in advance of the Meeting to determine the steps necessary to permit them to indirectly vote their Phivida Shares, as a proxy holder. In either case, Non-Registered Holders should carefully follow the instructions of their Intermediary or its agents, including those regarding when and where the Proxy or proxy authorization form is to be delivered. In light of ongoing concerns related to the spread of COVID-19, we encourage you not to plan to attend the Meeting in person and instead ensure you vote by proxy.

The Notice and Circular are being provided to Registered Phivida Shareholders. Non-Registered Holders fall into two categories – those who object to their identity being known to the issuers of securities which they own (“ OBOs ”) and those who do not object to their identity being made known to the issuers of the securities which they own (“ NOBOs ”). Subject to the provisions of NI 54-101, issuers may request and obtain a list of their NOBOs from Intermediaries directly or via their transfer agent and may obtain and use the NOBO list for the distribution of Proxy Solicitation Materials directly (not via Broadridge) to such NOBOs. If you are a Non-Registered Holder and Phivida or its agent has sent these materials directly to you, your name, address and information about your holdings of Phivida Shares have been obtained in accordance with applicable securities regulatory requirements from the Intermediary holding the Phivida Shares, as applicable, on your behalf.

Phivida is not relying on the “notice-and-access” delivery procedures outlined in NI 54-101 to distribute copies of the proxy related materials in connection with the Meeting, nor is Phivida sending Proxy Solicitation Materials directly to NOBOs.

Voting Shares and Principal Holders Thereof

The authorized capital of Phivida consists of an unlimited number of Phivida Shares. As of the Record Date, there were 89,033,717 Phivida Shares issued and outstanding, with each share carrying the right to one vote. To the knowledge of the directors and executive officers of Phivida, as of the Record Date, no person beneficially owned, directly or indirectly, or exercised control or direction over, 10% or more of the issued and outstanding Phivida Shares. Only Phivida Shareholders of record as at the close of business on July 24, 2020 are entitled to vote, or have their Phivida Shares voted, at the Meeting, or at any postponement or adjournment thereof.

INFORMATION CONCERNING THE MEETING

General Information

Phivida is delivering this Circular in connection with the solicitation of proxies for use at the Meeting of Phivida Shareholders to be held at the Holiday Inn Oakville, located at 590 Argus Road, Oakville, Ontario L6J 6G6 beginning at 10:00 a.m. (Eastern time) on September 4, 2020. Those attending the Meeting in person who are experiencing any of the described COVID-19 symptoms of fever, cough or difficulty breathing will not be permitted to attend the Meeting. Those attending in person will be required to comply with the then current direction and advice from federal, provincial and municipal levels of government concerning public gatherings. Note however that, in light of ongoing concerns related to the spread of COVID-19 and the constantly evolving restrictions on the size of public gatherings which are beyond the control of Phivida, attendance at the Meeting in person may be difficult or not

20 -

permitted. Accordingly, we encourage you not to plan to attend the Meeting in person and instead ensure you vote by proxy.

The Meeting has been called for the purpose of considering annual and special business. The special business consists of the approval of the Special Resolution attached hereto as Appendix “A” which, if passed, and if the Plan of Arrangement is completed, will result in, among other things, the acquisition by Choom of all of the issued and outstanding Phivida Shares. The proposed acquisition of Phivida by Choom will be completed by way of the Plan of Arrangement under the terms of the Arrangement Agreement as further described herein.

Additional disclosure regarding Phivida, including disclosure regarding executive and director compensation, corporate governance disclosure and audit committee disclosure, can be found at Appendix “G” – Additional Information Concerning Phivida attached to this Circular.

Receipt of the Phivida Audited Financial Statements

The audited financial statements of Phivida for the years ended September 30, 2019 and 2018, together with the auditors’ report thereon, will be placed before Phivida Shareholders at the Meeting. No formal action will be taken at the Meeting to approve the financial statements.

Election of Directors of Phivida

Phivida has nominated three individuals for election to the Phivida Board at the Meeting. Directors of Phivida are elected annually. Each director will hold office until the next annual meeting of Phivida Shareholders or until the successor of such director is elected or appointed, unless such office is earlier vacated. Voting on the election of Phivida directors will be conducted on an individual and not a slate basis. In the absence of a contrary instruction, the person(s) designated by management of Phivida in the enclosed form of proxy intend to vote FOR the election of the nominees whose names are set forth below, each of whom has been a director of Phivida since the date indicated below opposite such individual’s name. Management does not contemplate that any of the nominees listed below will be unable to serve as a director of Phivida, but if that should occur for any reason prior to the Meeting, the Phivida Shares represented by properly executed proxies given in favour of such nominee(s) may be voted by the person(s) designated by management of Phivida in the enclosed form of proxy, in their discretion, in favour of another nominee.

21 -

The following table sets forth information with respect to each nominee, including the number of Phivida Shares beneficially owned, directly or indirectly, or over which control or direction is exercised, by such nominee or their associates or affiliates, as at the date of this Circular. The information as to Phivida Shares beneficially owned or over which control or direction is exercised, not being within the knowledge of Phivida, has been furnished by the respective individual nominee.

Name and Place of Residence	Present and Principal Occupation, business or Employment for Previous 5 Years	Phivida Director Since	Number of Phivida Shares Beneficially Owned, Controlled or Directed
Peter Simeon(1)(2) Ontario, Canada	Partner at Gowling WLG (Canada) LLP since 2015; Partner at Wildeboer Dellelce LLP from 2008 to 2015.	May 5, 2017	125,000
David Moon(1) Ontario, Canada	Interim Chief Executive Officer of Phivida since November 2019; President of Wikala.com Inc. since 2017; President of Investintech.com Inc. since 2000.	May 28, 2019	3,816,050(3)
John Di Girolamo(1)(2) Ontario, Canada	President and Director of Starling Brands Inc. since 2017; Managing Partner of Liberty North Capital Corp. since 2013.	October 28, 2019	3,625,277

Notes:

(1) Member of the Audit Committee of the Phivida Board.

(2) Member of the Special Committee of the Phivida Board.

(3) Of these, a total of 684,029 Phivida Shares are owned directly, and the remaining 3,132,021 Phivida Shares are held in a holding company of which Mr. Moon is a minority shareholder, however he exercises control or direction over these Phivida Shares.

Biographies of Proposed Phivida Directors Who Have Not Previously Been Elected

David Moon

Mr. Moon founded Wikala.com Inc. in January 2017 and currently serves as the Interim Chief Executive Officer and a board member of Phivida, as well as the President of Wikala.com Inc. Previously, he cofounded Investintech.com Inc., a software company he led as President and as a board member. He has managed international distributed teams involving technology and product development and navigated hyper-competitive markets subject to constant change. Prior to his business involvement, Mr. Moon practiced law as a securities lawyer. He received his J.D. and MBA at the University of Toronto and his B.A. from McGill University.

John Di Girolamo

Mr. Di Girolamo is the Managing Partner of Liberty North Capital Corp., an independent, boutique investment bank focusing on finance and advisory services for both private and public companies. Mr. Di Girolamo brings a wealth of capital market expertise having worked in the industry for 20 years. He has been an active investor and advisor to companies in the cannabis sector, and also acts as a director and President at Starling Brands, a manufacturer of premium cannabis products in California. Prior to founding Liberty North Capital, Mr. Di Girolamo held roles in trading and wealth management. Mr. Di Girolamo received his B.A. from York University.

22 -

Corporate Cease Trade Orders, Bankruptcies, Penalties and Sanctions

Cease Trade Orders

No nominee for election as a director of Phivida is or has been, within the preceding ten years, a director, chief executive officer or chief financial officer of any company (including Phivida) that:

(a) was the subject of a cease trade order or similar order, or an order that denied such company access to any exemptions under applicable securities legislation that was issued while the proposed director was acting in the capacity as director, chief executive officer or chief financial officer; or
(b) was the subject of a cease trade or similar order, or an order that denied such company access to any exemptions under applicable securities legislation that was issued after the proposed director 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 a director, chief executive officer or chief financial officer.

Bankruptcies

No nominee for election as a director of Phivida is or has been, within the preceding ten years, a director or executive officer of any company (including Phivida) 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.

No nominee for election as a director of Phivida is or has, within the preceding ten years, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or has 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 such person.

Penalties and Sanctions

No nominee for election as a director of Phivida 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 securityholder in deciding whether to vote for a proposed director.

Appointment of Auditors

Baker Tilly WM LLP are the current auditors of Phivida. Baker Tilley WM LLP were first appointed as auditors of Phivida on May 5, 2017. At the Meeting, holders of Phivida Shares will be requested to appoint Baker Tilley WM LLP as auditors of the Company to hold office until the next annual meeting of Phivida

23 -

Shareholders or until a successor is appointed, and to authorize the Phivida Board to fix the auditors’ remuneration.

Approval of the Special Resolution Regarding the Arrangement

At the Meeting, Phivida Shareholders will be asked to consider, pursuant to the Interim Order and, if deemed advisable, pass, with or without variation, the Special Resolution to authorize and approve the Arrangement. Pursuant to the Interim Order, the Special Resolution must be approved by not less than two-thirds of the votes cast by the Phivida Shareholders present in person or represented by proxy at the Meeting voting together as a single class. The Arrangement is not a “business combination” under MI 61-101. As such, Phivida is not required to seek “minority approval” of the Arrangement by Phivida Shareholders under MI 61-101. Furthermore, no other shareholder approvals are required by the CSE. See “ Information Concerning the Arrangement – Securities Laws and Considerations ”.

Unless otherwise directed, the persons named in the form of proxy accompanying this Circular intend to vote “ FOR ” the Special Resolution. See “ Information Concerning the Arrangement ” for further details regarding the Arrangement and the Arrangement Agreement. The text of the Special Resolution is attached hereto as Appendix “A” and a copy of the Plan of Arrangement is attached hereto as Appendix “B”. A description of a Phivida Shareholder’s right of dissent in respect of the Special Resolution and the Arrangement is included under the heading “ Rights of Dissenting Shareholders ”.

Additional Business

At the Meeting, Phivida Shareholders will also transact such further or other business as may properly come before the Meeting or any adjournments or postponements thereof. At the time of printing this Circular, the management of Phivida is not aware that any such amendments, variations or other matters are to be presented for action at the Meeting. However, the instrument of Proxy enclosed, when properly signed, confers discretionary authority on the proxyholder with respect to amendments or variations to the matters which may properly be brought before the Meeting or any postponement or adjournment thereof. If any other matters which are not now known to the management should properly come before the Meeting, the proxies hereby solicited will be voted on such matters in accordance with the best judgment of the proxyholder.

24 -

INFORMATION CONCERNING THE ARRANGEMENT

The following summarizes, among other things, the principal elements of the Arrangement and the material terms of the Arrangement Agreement. A copy of the Arrangement Agreement can be found on SEDAR. Phivida Shareholders are urged to read the Arrangement Agreement in its entirety for a more complete description of the transactions contemplated therein, including the Arrangement and this description is qualified in its entirety by reference to the full text of the Arrangement Agreement.

On June 2, 2020, Phivida and Choom entered into the Arrangement Agreement pursuant to which Choom will, among other things, acquire all outstanding Phivida Shares in exchange for Choom Shares pursuant to the Plan of Arrangement. Upon completion of the Arrangement, Phivida will become a wholly-owned subsidiary of Choom.

Background to the Arrangement

The Arrangement Agreement is the result of arm’s length negotiations among representatives and outside legal counsel of each of Phivida and Choom. The following is a summary of the background and execution by the parties of the Arrangement Agreement.

In November of 2019, Phivida established the Special Committee, which was tasked with conducting a strategic review process, which included exploring potential corporate transactions. In connection with the strategic review process, Phivida pursued and engaged with a number of parties that it believed would reasonably be expected to have an interest in acquiring, being acquired by, or combining with, Phivida. In connection with its strategic review, Phivida retained Hillcrest Merchant Partners Inc. (“ Hillcrest ”), to act as financial advisor to Phivida in connection with various strategic alternatives. Hillcrest provided several introductions to Phivida in respect of potential transaction, and members of management and the Special Committee met regularly with Hillcrest to discuss and consider potential transactions. Despite these introductions, none of the parties that Phivida had been in contact with (other than Choom) developed into an executable transaction.
BDO Transaction Advisory Services Inc., who were acting as exclusive financial advisor to Choom, contacted Phivida and Hillcrest to present Choom as a potential party to transact with.
Choom and Phivida entered into a confidentiality agreement dated March 24, 2020 after which the parties began discussing a potential acquisition of Phivida by Choom. The discussions culminated in a non-binding letter of intent that was entered into between the parties on April 30, 2020.
On May 4, 2020 the parties held a “kick-off” call with the parties’ respective counsel and financial advisors, at which various legal and commercial matters pertaining to the potential transaction were discussed. Shortly thereafter, counsel for each of the parties circulated due diligence requisition lists, and the parties began conducting their respective due diligence investigations, and counsel began drafting the Arrangement Agreement.
On May 13, 2020, Phivida formally retained Haywood to provide the Fairness Opinion.
The deadline that the parties had set in the letter of intent by which they would endeavour to enter into the Arrangement Agreement was extended on May 21, 2020 and again on May 29,
25 -

2020, in order to give the parties additional time to complete their due diligence investigations (including site visits conducted by representatives of Phivida at Choom dispensaries) and complete their negotiations of the Arrangement Agreement.

After the close of markets on June 2, 2020, the Special Committee met with Phivida’s outside legal counsel Gowling WLG and Haywood and, subsequently, the Phivida Board. After careful consideration, including consultation with Gowling WLG and Haywood, and after receiving an oral version of the Fairness Opinion from Haywood (which was subsequently confirmed in writing), the Special Committee unanimously determined that the consideration to be received by Phivida Shareholders was fair, from a financial point of view, and that the Arrangement was in the best interests of Phivida and its securityholders. The Phivida Board unanimously approved the Arrangement and the entering into of the Arrangement Agreement. The Parties then proceeded to finalize and enter into the Arrangement Agreement later that evening. At the request of the Parties, trading in the Phivida Shares and Choom Shares were halted on the CSE, pending a joint announcement regarding the Arrangement and the entering into of the Arrangement Agreement, which was issued on June 3, 2020. Trading in Phivida Shares and Choom Shares resumed later that day.
On July 23, 2020, in connection with the parties entering into the Bridge Loan, the parties amended the Arrangement Agreement in order to provide that the original closing condition in favour of Choom that Phivida have not less than $2,000,000 in working capital surplus be reduced to $1,500,000, on account of the funds advanced to Choom by Phivida under the Bridge Loan. For information about the Bridge Loan, please refer to the heading “ Information Concerning the Arrangement – Other Transactions ”.

Principal Steps of the Arrangement

The principal steps of the Arrangement may be summarized as follows (and such summary is qualified in its entirety by reference to the full text of the Plan of Arrangement, attached hereto as Appendix “B”, and the Arrangement Agreement as filed on SEDAR):

(a) Each Phivida Share outstanding immediately prior to the Effective Time held by a Phivida Shareholder in respect of which Dissent Rights have been validly exercised will be deemed to have been transferred without any further act or formality to Phivida for cancellation.
(b) Each other issued and outstanding Phivida Share will be transferred to, and acquired by Choom, without any act or formality on the part of the holder of such Phivida Share or Choom, in exchange for the Consideration.
(c) Each Phivida Option which is outstanding and has not been duly exercised prior to the Effective Time (whether vested or unvested), will be exchanged for a Replacement Option to purchase from Choom such number of Choom Shares equal to the product obtained when (i) the number of Phivida Shares subject to the Phivida Option immediately prior to the Effective Time is multiplied by (ii) 0.72566 (rounding down any resulting fractional share interest to the nearest whole number of Choom Shares). Each Replacement Option will provide for an exercise price per Choom Share equal to the quotient obtained when (i) the exercise price per Phivida Share subject to each such Phivida Option immediately before the Effective Time is divided by (ii) 0.72566 (rounding up to the nearest whole cent). All other terms and conditions of the Replacement Options, including
26 -

vesting, the term to expiry, conditions to and manner of exercising, will remain the same and will be governed by the terms of the Phivida Option Plan.

No Phivida Shareholder will receive fractional Choom Shares under the Plan of Arrangement and no cash will be paid in lieu thereof. Any fractions resulting from the Plan of Arrangement will be rounded down to the nearest whole number.

The rights of creditors against the property and interests of Phivida will be unimpaired by the Arrangement.

The full particulars of the Arrangement are contained in the Plan of Arrangement, a copy of which is attached as Appendix “B” to this Circular.

As of the Record Date, there were 225,753,870 Choom Shares outstanding and there were 89,033,717 Phivida Shares outstanding. In addition, as of the Record Date, an aggregate of 10,861,611 Phivida Shares were issuable upon the exercise of Phivida Options. Based on the foregoing, after giving effect to the transactions contemplated by the Arrangement, there will be approximately 290,362,077 Choom Shares issued and outstanding, of which approximately 22% will be held by former Phivida Shareholders, assuming no additional shares are issued by any of the Parties other than pursuant to the Arrangement.

Effect of the Arrangement

Upon the completion of the Arrangement, it is expected that:

(a) Choom will have acquired all of the issued and outstanding Phivida Shares, other than those Phivida Shares held by Phivida Shareholders who have validly exercised their Dissent Rights, on the basis of 0.72566 of a Choom Share for each Phivida Share held;
(b) any Phivida Shareholder who validly exercises Dissent Rights will have transferred their Phivida Shares to Phivida for the consideration determined in accordance with the Dissent Rights as set out under the heading “ Rights of Dissenting Shareholders ”;
(c) assuming from the Record Date to the completion of the Plan of Arrangement that no additional shares are issued by any of the Parties other than pursuant to the Arrangement:
(i) there will be an aggregate of approximately 290,362,07 Choom Shares issued and outstanding; and
(ii) current Phivida Shareholders will hold an aggregate of approximately 64,608,207 Choom Shares, representing approximately 22% of the then issued and outstanding Choom Shares.

As a result of the Arrangement, current Phivida Shareholders will receive Choom Shares. See “ Additional Information Concerning Choom Before and After the Arrangement – Description of Capital Structure ” in Appendix “H” to this Circular for further information regarding the rights attached to the Choom Shares. After completion of the Arrangement, Choom expects to continue to be listed on the CSE.

27 -

Reasons for the Arrangement

The acquisition of Phivida by Choom pursuant to the Arrangement Agreement was the result of arm’s length negotiations between the parties. In reaching its conclusions and formulating its recommendation that Phivida Shareholders vote FOR the Special Resolution, the Phivida Board reviewed and considered a significant amount of information and considered a number of factors relating to the Arrangement with the benefit of advice from the Special Committee, Haywood (financial advisor to the Special Committee), Phivida’s outside legal counsel and input from Phivida’s senior management team. The Special Committee and the Phivida Board did not find it practicable to, and therefore did not, quantify or otherwise attempt to assign any relative weight to each specific factor or item of information considered in reaching their conclusions and recommendations. In negotiating the terms of the Arrangement, the Phivida Board considered various factors including the respective market value of Phivida Shares and Choom Shares and various measures of assets, liabilities, contingent liabilities and risks as applicable to each of Phivida and Choom. The following is a summary of the principal reasons for the recommendation of the Special Committee and the Phivida Board that Phivida Shareholders vote FOR the Special Resolution:

(a) Significant Premium to Phivida Shareholders. The exchange ratio at which the consideration offered by Choom was determined was based on the 20-day volumeweighted average trading prices of Phivida Shares (plus a 10% premium) and Choom Shares ending June 2, 2020 (being the trading day on which the Arrangement Agreement was entered into). Based on the closing price of the Phivida Shares on June 2, 2020, the Arrangement contemplates an implied premium of approximately 20% per Phivida Share.
(b) Enhance Choom’s Leadership Position in Cannabis Retail . If the Arrangement is completed, it is expected that the combined company will benefit from a vertically integrated strategy focused on cannabis retail and consumer experiences, by leveraging Choom’s current bricks and mortar retail presence with Phivida’s digital assets and branded product expertise.
(c) Accelerate National Store Roll-out Program: If the Arrangement is completed, Choom will leverage Phivida’s current assets, to accelerate the build-out of additional stores in Ontario and British Columbia. The combined company will further benefit from its deep relationships with prominent landlords to support future store growth at marquee locations.
(d) Strengthen Choom’s Digital Strategy & Analytics: If the Arrangement is completed, Choom will leverage Phivida’s digital assets and capabilities to enhance growth and consumer experiences in its retail stores by utilizing Phivida’s e-commerce solutions and content-rich marketing platforms.
(e) Enhanced Scale and Access to Capital : If the Arrangement is completed, the combined company will benefit from enhanced capital markets presence and a broader shareholder group, with strengthened access to growth capital.
(f) Bolster Management Team with Added Capabilities and Broader Stakeholders: If the Arrangement is completed, the combined company will have blue-chip retail and branded product capabilities, digital and online expertise, countrywide geographical representation and an aligned entrepreneurial spirit committed to creating one of the dominant national cannabis retailers in Canada.
28 -
(g) More Recent Review of Alternatives. Since November 2019, Phivida has pursued and engaged with a number of parties that it believed would reasonably be expected to have an interest in acquiring, being acquired by, or combining with, Phivida. Prior to entering into the Arrangement Agreement, the Special Committee and the Phivida Board considered these parties and determined that it was unlikely any of those parties would be interested in making a proposal that could be superior to a potential transaction with Choom.
(h) Review of Alternative of Not Pursuing a Transaction . The Special Committee and the Phivida Board also considered whether Phivida pursuing its standalone business strategy would be preferable to the Arrangement Agreement. The Special Committee and the Phivida Board were concerned that pursuing its standalone business strategy would provide limited opportunities for growth in an increasingly competitive marketplace. The Special Committee and the Phivida Board concluded that the proposed transaction with Choom provided greater opportunities for Phivida and, in turn, greater value to Phivida Shareholders.
(i) Fairness Opinion. Haywood has provided an opinion to the Special Committee that, based upon and subject to certain assumptions, limitations and qualifications outlined in the opinion and such other matters as were considered relevant, the consideration to be received by the Phivida Shareholders in respect of the Arrangement is fair, from a financial point of view, to the Phivida Shareholders.
(j) Support of Phivida Directors, Officers and Shareholders. All of the directors and officers of Phivida, as well as certain other Phivida Shareholders, entered into the Support and Voting Agreements in which they each agreed, subject to the terms of their respective Support and Voting Agreements, to vote their Phivida Shares in favour of the Special Resolution. Such Phivida Shareholders own or exercise control or direction over an aggregate of 28,539,235 Phivida Shares or approximately 32% of the issued and outstanding Phivida Shares.
(k) Superior Proposal . Under the Arrangement Agreement, the Phivida Board remains able to respond to unsolicited Acquisition Proposals that would reasonably be expected to lead to a Superior Proposal, and that the termination payment payable to Choom in connection with a termination of the Arrangement Agreement is reasonable in the circumstances and not preclusive of other offers.

In its review of the proposed terms of the Arrangement, the Special Committee and the Phivida Board also considered a number of elements of the transaction that provided protection to the Phivida Shareholders:

==> picture [12 x 11] intentionally omitted <==

The Arrangement must be approved by not less than two-thirds of the votes cast by the Phivida Shareholders present in person or represented by proxy at the Meeting voting together as a single class.

==> picture [12 x 11] intentionally omitted <==

The Arrangement contemplated by the Arrangement Agreement will only become effective if, after hearing from all interested persons who choose to appear before it, the Court determines that the Arrangement is fair and reasonable to the Phivida Shareholders.
29 -

==> picture [11 x 11] intentionally omitted <==

Phivida Shareholders who oppose the Arrangement may, upon compliance with certain conditions, exercise their rights of dissent and receive the fair value of their Phivida Shares in accordance with the Plan of Arrangement.

==> picture [12 x 11] intentionally omitted <==

The Special Committee was comprised of only independent directors of Phivida.

==> picture [12 x 11] intentionally omitted <==

The Special Committee retained independent financial advisors.

In the course of its deliberations, the Special Committee and the Phivida Board also considered a variety of risks, uncertainties and other potentially countervailing factors, including but not limited to the following (which are not necessarily presented in order of relative importance):

(a) If the Arrangement is not consummated or is delayed, it could have an adverse effect on Phivida’s business and share price.
(b) Phivida’s Shareholders may not approve the Arrangement.
(c) There can be no assurance that the conditions in the Arrangement Agreement to Phivida’s and Choom’s obligations to complete the Arrangement will be satisfied and, as a result, the Arrangement may not be consummated.
(d) Substantial time, effort and transaction costs are associated with entering the Arrangement Agreement and completing the Arrangement, which could disrupt the operation of Phivida’s business.
(e) The Arrangement Agreement contains restrictions on the conduct of Phivida’s business prior to the completion of the Arrangement which could delay or prevent Phivida from undertaking business opportunities, including Phivida’s ability to solicit Acquisition Proposals from third parties, that may arise pending the completion of the Arrangement.
(f) The possibility that the combined company will not realize all of the anticipated strategic and other benefits of the Arrangement, including as a result of the challenges of combining the businesses, operations and workforces of each of Choom and Phivida, and in obtaining additional financing.

Recommendation of the Special Committee and Phivida Board

The Special Committee and Phivida Board have reviewed and considered the Arrangement. The Special Committee has, after consultation with Phivida’s outside legal counsel and financial advisor, and after receiving the opinion of Haywood on June 2, 2020 (the text of which is attached as Appendix “F” to the Circular) as to the fairness, from a financial point of view, to the Phivida Shareholders of the Consideration, unanimously determined that the Consideration to be received by the Phivida Shareholders is fair, from a financial point of view, and that the Arrangement is in the best interests of Phivida and its securityholders, and the Phivida Board unanimously approved the Arrangement and the Arrangement Agreement and recommends that the Phivida Shareholders vote their Phivida Shares in favour of the Special Resolution.

Each member of the Phivida Board is required, by the terms of their respective Support and Voting Agreement, to vote all Phivida Shares held FOR the Special Resolution, subject to the terms of the Arrangement Agreement and the Support and Voting Agreements.

30 -

Interests of Certain Persons in the Arrangement

In considering the recommendation of the Phivida Board with respect to the Arrangement, Phivida Shareholders should be aware that certain members of the Phivida Board and Phivida’s management have interests that may be perceived as conflicts of interest in connection with the Arrangement. The Phivida Board is aware of these interests and considered them along with other matters described herein.

Phivida Shares

As of the date hereof, the directors and executive officers of Phivida as a group own, control or direct, in the aggregate, 8,189,077 Phivida Shares, representing approximately 9.2% of the outstanding Phivida Shares. All of the Phivida Shares held by the directors and executive officers of Phivida will be treated in the same manner under the Arrangement as the Phivida Shares held by every other Phivida Shareholder. The directors and executive officers of Phivida intend to vote their Phivida Shares “ FOR ” the Special Resolution.

As at the date of this Circular, the directors and executive officers of Phivida, as a group, beneficially own, or control or direct, directly or indirectly, an aggregate of nil Choom Shares.

Following the Arrangement, it is expected that there will be approximately 290,362,077 Choom Shares issued and outstanding and that the directors and executive officers of Phivida will beneficially own, directly and indirectly, or exercise control or direction over, in the aggregate, approximately 5,942,485 Choom Shares at such time, representing approximately 2% of the outstanding Choom Shares at such time.

The Phivida Shares held by each individual director and executive officer of Phivida are set out in the table below under the heading “ Summary of Interests of Phivida Directors and Executive Officers in the Arrangement ”.

Phivida Options

As of the date hereof, the directors and executive officers of Phivida hold in the aggregate Phivida Options to acquire, in the aggregate, up to 2,956,529 Phivida Shares. See “ Information Concerning the Arrangement – Treatment of Phivida Options ” for a description of how Phivida Options will be treated in the Arrangement.

The Phivida Options held by each individual director and executive officer of Phivida are set out in the table below under “ Summary of Interests of Phivida Directors and Executive Officers in the Arrangement ”.

Employment Agreements and Change of Control Payments

No directors or executive officers of Phivida are entitled to receive a change of control or similar lump sum payment resulting from the completion of the Arrangement.

Insurance and Indemnification

Prior to the Effective Date, Phivida may, in its discretion, purchase customary “tail” policies of directors’ and officers’ liability insurance providing protection no less favourable in the aggregate to the protection provided by the policies maintained by Phivida and its Subsidiaries which are in effect immediately prior

31 -

to the Effective Date and providing protection in respect of claims arising from facts or events which occurred on or prior to the Effective Date and Choom shall, or shall cause Phivida and its Subsidiaries to maintain such tail policies in effect without any reduction in scope or coverage for two (2) years from the Effective Date; provided that Choom shall not be required to pay any amounts in respect of such coverage prior to the Effective Time and provided further that the cost of such policies shall not exceed 300% of Phivida’s current annual aggregate premium for policies currently maintained by Phivida or its Subsidiaries.

Choom has covenanted and agreed that it shall, following the Effective Date, cause Phivida to honour all rights to indemnification or exculpation now existing in favour of present and former employees, officers and directors of Phivida and its Subsidiaries to the extent that they are: (i) included in the constating documents of Phivida or any of its Subsidiaries, or (ii) disclosed in writing to Choom, and acknowledges that such rights under both (i) and (ii) shall survive the completion of the Plan of Arrangement and shall continue in full force and effect in accordance with their terms for a period of not less than six (6) years from the Effective Date.

If Phivida or any of its Subsidiaries or any of their respective successors or assigns: (i) consolidates with or merges into any other Person and is not a continuing or surviving corporation or entity of such consolidation or merger, or (ii) transfers all or substantially all of its properties and assets to any Person, Choom shall ensure that any such successor or assign (including, as applicable, any acquirer of substantially all of the properties and assets of Phivida or its Subsidiaries) assumes all of Phivida’s obligations set forth above.

Choom shall act as agent and trustee of the benefits of the foregoing for the current and former directors and officers of Phivida for the purpose of the indemnification/exculpation provisions above. The foregoing provisions shall survive the execution and delivery of the Arrangement Agreement and the completion of the Arrangement and shall be enforceable against Choom by the Persons described above.

Summary of Interests of Phivida Directors and Executive Officers in the Arrangement

The interests of the directors and executive officers of Phivida in the Arrangement are summarized in the following table. The Phivida Board was aware of these interests and considered them, among other matters, when recommending approval of the Arrangement to Phivida Shareholders.

		Number of Choom
		Shares Issuable
	Number of Phivida	Pursuant to the		Number of
	Shares Owned or	Arrangement in		Replacement
	Over Which Control	Exchange for		Options held on
Name, Title and Jurisdiction	or Direction is	Phivida Shares	Number of Phivida	Completion of
of Residence	Exercised (1)	Held (2)	Options Held	Arrangement(2)
Peter Simeon Chairman of the Board and Director Ontario, Canada John Di Girolamo Director Ontario, Canada	125,000 3,625,277	90,707 2,630,718	550,000 200,000	399,113 145,132

32 -

		Number of Choom
		Shares Issuable
	Number of Phivida	Pursuant to the		Number of
	Shares Owned or	Arrangement in		Replacement
	Over Which Control	Exchange for		Options held on
Name, Title and Jurisdiction	or Direction is	Phivida Shares	Number of Phivida	Completion of
of Residence	Exercised (1)	Held (2)	Options Held	Arrangement(2)
David Moon Interim Chief Executive Officer and Director Ontario, Canada Carmelo Marrelli Chief Financial Officer Ontario, Canada George Kovalyov Vice-President, Finance British Columbia, Canada Mike Cornwell Chief Marketing Officer British Columbia,Canada	3,816,050 150,000 472,750 Nil	2,769,154 108,849 343,055 Nil	1,056,529 150,000 700,000 500,000	766,680 108,849 507,962 362,830

Notes:

(1) The information as to province or state, country of residence and number of Phivida Shares owned, or over which control or direction is exercised, not being within the knowledge of Phivida, has been furnished by the respective individual named above.

(2) Based on the exchange ratio of 0.72566 of a Choom Share for each Phivida Share and, in the case of Phivida Options, based on the adjustments contemplated pursuant to the Plan of Arrangement which are based on the same exchange ratio.

Support and Voting Agreements

On June 2, 2020, concurrently with the execution of the Arrangement Agreement, Choom entered into support and voting agreements (collectively, the “ Support and Voting Agreements ”) with certain Phivida Shareholders, as well as all of the directors and officers of Phivida who hold securities of Phivida (collectively, the “ Supporting Shareholders ”).

As at June 2, 2020, the Supporting Shareholders beneficially owned, directly or indirectly, or exercised control or direction over, in the aggregate, Phivida Shares representing approximately 32% of the outstanding Phivida Shares and have agreed, subject to the terms of the Support and Voting Agreements, to, among other things, vote all of the Phivida Shares held by them in favour of the Special Resolution.

The following is a summary of the principal terms of the Support and Voting Agreements. This summary does not purport to be complete and is qualified in its entirety by the complete text of the Support and Voting Agreements, copies of each which are available under Phivida’s and Choom’s SEDAR profile at www.sedar.com.

Certain Shareholders

Under the Support and Voting Agreement entered into between Choom and certain Phivida Shareholders (the “ Shareholder Support and Voting Agreements ”), these shareholders have agreed, among other things:

33 -
(a) at the Meeting or at any adjournment or postponement thereof or in any other circumstances upon which a vote, consent or other approval (including by written consent in lieu of a meeting) with respect to the Arrangement is sought, the shareholders will cause the Phivida Shares owned by them (the “ Holder Shares ”) to be counted as present for purposes of establishing quorum and will vote (or cause to be voted) the Holder Shares and any other Phivida Shares which they may then beneficially own (i) in favour of the approval of the Arrangement, and (ii) in favour of any other matter necessary for the consummation of transactions contemplated by the Arrangement Agreement;
(b) at any meeting of securityholders of Phivida or at any adjournment thereof or in any other circumstances upon which a vote, consent or other approval of all or some of the securityholders of Phivida is sought (including by written consent in lieu of a meeting), the shareholders will cause the Holder Shares to be counted as present for purposes of establishing quorum and will vote (or cause to be voted) the Holder Shares and any other Phivida Shares which they may then beneficially own against any (i) Acquisition Proposal and/or any matter that could reasonably be expected to delay, prevent or frustrate the successful completion of the Arrangement or any of the transactions contemplated by the Arrangement Agreement, or (ii) action or agreement that would result in a breach of any representation, warranty, covenant, agreement or other obligation of Choom in the Arrangement Agreement or the shareholders in the Shareholder Support and Voting Agreements;
(c) as soon as practicable following the mailing of this Circular and in any event no later than ten Business Days prior to the date of the Meeting, the shareholders will deliver or cause to be delivered to Phivida, with a copy to Choom concurrently, a duly executed proxy or proxies directing those individuals as may be designated by Phivida in this Circular to vote (i) in favour of the Arrangement, and (ii) in favour of any other matter necessary for the consummation of transactions contemplated by the Arrangement Agreement, and each such proxy or proxies will not be revoked without the written consent of Choom unless the Shareholder Support and Voting Agreements are terminated in accordance with their terms prior to the exercise of such proxy;
(d) in the event that any transaction (other than the Arrangement) is presented for approval of, or acceptance by, Phivida, whether or not it may be recommended by the Phivida Board, the shareholders shall not directly or indirectly, accept, assist or otherwise further the successful completion of such transaction or purport to tender or deposit into any such transaction any of the Holder Shares or any other Phivida Shares which they may then beneficially own, and the shareholders will, if requested by Choom, publicly affirm their commitment to vote in favour of the Arrangement;
(e) to, and to cause their officers, directors, employees, representatives or agents, as applicable, to, immediately cease and terminate, and cause to be terminated, any solicitation, encouragement, discussion, negotiations or other activities commenced prior to the date of the Shareholder Support and Voting Agreements with any Person (other than Choom or its affiliates) by the shareholders or, if applicable, any of the officers, directors, employees, representatives or agents of the shareholders, as applicable, with respect to any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to, an Acquisition Proposal; and
(f) if the shareholders or any of their officers, directors, employees, representatives or agents, as applicable, receives, or otherwise becomes aware of (including as a result of an approach made
34 -

by a third party to the shareholders) any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to an Acquisition Proposal, or receives any request for copies of, access to, or disclosure of, confidential information that is made, or that may reasonably be perceived to be made, in connection with an Acquisition Proposal, the shareholders shall immediately notify Choom, at first orally, and then promptly and in any event within 48 hours in writing, of such Acquisition Proposal, inquiry, proposal, offer or request, including a description of its material terms and conditions and the identity of all Persons making the Acquisition Proposal, inquiry, proposal, offer or request, and the shareholders shall provide Choom with copies of all documents, correspondence or other material received in respect of, from or on behalf of any such Person;

Pursuant to the Shareholder Support and Voting Agreements, the shareholders have agreed not to:

(a) directly or indirectly, or, if applicable, through any officer, director, employee, representative or agent of the shareholders, as applicable:
(i) solicit, initiate, knowingly facilitate, encourage or promote (including, without limitation, by way of furnishing or providing copies of, access to, or disclosure of, any confidential information, properties, facilities, books or records of Phivida or any subsidiary of Phivida or entering into any form of agreement, arrangement or understanding) any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to, an Acquisition Proposal;
(ii) enter into or otherwise engage or participate in any discussions or negotiations with any Person (other than Choom or any of its affiliates) regarding any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to, an Acquisition Proposal;
(iii) accept, approve, endorse or recommend, or publicly propose to accept, approve, endorse or recommend, or take no position or remain neutral with respect to, any publicly announced or otherwise publicly disclosed Acquisition Proposal in respect of Phivida;
(iv) tender or cause to be tendered any of its Holder Shares to any Acquisition Proposal;
(v) withdraw support, or propose publicly to withdraw support, from the transactions contemplated by the Arrangement Agreement;
(vi) influence the Phivida Board to withdraw or modify in a manner adverse to Choom, its approval of the transactions contemplated in the Arrangement Agreement;
(vii) make any public comments or statements, written or verbal, which are inconsistent with the obligations of the Shareholder under the Shareholder Support and Voting Agreement;
(viii) enter into or publicly propose to enter into any agreement, understanding or arrangement in respect of an Acquisition Proposal; and
(ix) join in the requisition of any meeting of the securityholders of Phivida for the purpose of considering any resolution related to any Acquisition Proposal and/or any matter that could reasonably be expected to delay, prevent or frustrate the successful completion of
35 -

the Arrangement or any of the transactions contemplated by the Arrangement Agreement;

(b)
directly or indirectly:
(i) sell, transfer, gift, assign, grant a participation interest in, option, pledge, hypothecate, grant a security or voting interest in or otherwise convey or encumber (each, a “ Transfer ”), or enter into any agreement, option or other arrangement (including any profit sharing arrangement) with respect to the Transfer of any of the Holder Shares to any person, other than pursuant to the Arrangement Agreement;
(ii) grant any proxies or power of attorney, deposit any of the Holder Shares into any voting trust or enter into any voting arrangement, whether by proxy, voting agreement or otherwise, with respect to the Holder Shares, other than pursuant to the Shareholder Support and Voting Agreements;
(iii) otherwise enter into any agreement or arrangement with any person or entity or commit any act that could limit, restrict or affect the shareholder’s legal power, authority, or right to vote any of its Holder Shares or otherwise prevent or disable the shareholder from performing any of its obligations under the Shareholder Support and Voting Agreement; or
(iv) requisition or join in the requisition of any meeting of any of the shareholders of Phivida for the purpose of considering any resolution.
(c) exercise any rights of appraisal or rights of dissent provided under any applicable Laws or otherwise in connection with the Arrangement or the transactions contemplated by the Arrangement Agreement considered at the Meeting in connection therewith, or any other shareholder rights or remedies available to the shareholder, whether arising under statute, at common law or otherwise, to impede, frustrate, nullify, prevent, hinder, delay, upset or challenge the Arrangement.

The Shareholder Support and Voting Agreements will automatically terminate upon the earlier of (i) the valid termination of the Arrangement Agreement in accordance with its terms, (ii) the Phivida Board entering into a definitive agreement in connection with the receipt of a Superior Proposal in compliance with the Arrangement Agreement, (iii) the Choom Board entering into a definitive agreement in connection with the receipt of a Competing Transaction in compliance with the Arrangement Agreement, (iv) the Effective Time, and (v) September 30, 2020.

The Shareholder Support and Voting Agreements may also be terminated by notice in writing:

(a) at any time prior to the Effective Time, by the mutual agreement of the parties;
(b) by Choom if (i) a shareholder breaches or is in default of any of the covenants or obligations of such shareholder under the Shareholder Support and Voting Agreement and such breach or such default has or may reasonably be expected to have an adverse effect on the consummation of the transactions contemplated by the Arrangement Agreement, or (ii) any of the representations or warranties of a shareholder under the Shareholder Support and Voting Agreement were, as at June 2, 2020, or subsequently become, untrue or incorrect; provided in each case that Choom has
36 -

notified the shareholder in writing of any of the foregoing events and the same has not been cured by the shareholder within ten Business Days of the date such notice was received by the shareholder;

(c) by the shareholders if (i) Choom breaches or is in default of any of the covenants or obligations of Choom under the Shareholder Support and Voting Agreements and such breach or such default has or may reasonably be expected to have an adverse effect on the consummation of the transactions contemplated by the Arrangement Agreement or (ii) any of the representations or warranties of Choom under the Shareholder Support and Voting Agreements were, as at June 2, 2020, or subsequently become, untrue or incorrect, except to the extent any such failure to be true or correct would preclude Choom from consummating the Arrangement; provided in each case that the shareholders have notified Choom in writing of any of the foregoing events and the same has not been cured by Choom within ten Business Days of the date such notice was received by Choom; or
(d) by the shareholders if, without the shareholders' prior written consent (such consent not to be unreasonably withheld, conditioned or delayed), the Arrangement Agreement is amended in any material respect in such a manner that would be materially adverse to the interests of the shareholders, including, without limitation, to provide for any decrease in the Consideration set out in the Arrangement Agreement.

Directors and Officers of Phivida

Under the Support and Voting Agreements entered into between Choom and all of the directors and officers of Phivida (the “ D&O Support and Voting Agreements ”), the directors and officers of Phivida have each agreed, among other things:

(a) to vote (or to cause to be voted), all of his or her Phivida Shares and Phivida Options (collectively, the “ Subject Securities ”) and any other Phivida Shares (the “ Additional Shares ”) that are directly or indirectly acquired by or issued to such relevant Supporting Shareholder after June 2, 2020 that are directly or indirectly acquired by or issued to him or her after such date, provided such Additional Shares are beneficially owned by the relevant Supporting Shareholder, or over which control or direction is exercised by the relevant Supporting Shareholder and such Additional Shares are entitled to be voted in respect of the Special Resolution (including, without limitation any common shares issued upon the exercise of Phivida Options), if any, (i) in favour of the Special Resolution and any other matter necessary for the consummation of the transactions contemplated by the Arrangement Agreement, and (ii) against any Acquisition Proposal and/or any matter that could reasonably be expected to delay, prevent or frustrate the successful completion of the Arrangement or any of the transactions contemplated by the Arrangement Agreement;
(b) if requested by Choom, acting reasonably, to deliver or to cause to be delivered to Choom duly executed proxies in Choom’s favour or in favour of Phivida, such proxies instructing the holder thereof to vote in favour of the Special Resolution;
(c) to not exercise any rights of appraisal or rights of dissent provided under any applicable Laws or otherwise in connection with the Arrangement or the transactions contemplated by the Arrangement Agreement;
37 -
(d) except in his or her capacity as director or officer to the extent permitted by the Arrangement Agreement, not to take any action which is reasonably likely to in any manner impede, interfere with, delay, postpone, hinder, prevent or challenge the Arrangement;
(e) except in his or her capacity as director or officer to the extent permitted by the Arrangement Agreement, not to, directly or indirectly, solicit, assist, initiate or knowingly encourage any inquiries or proposals regarding an Acquisition Proposal, or enter into or engage in any discussion, negotiation or inquiries relating to an Acquisition Proposal; and
(f) not to, directly or indirectly, sell, transfer, pledge or assign or agree to sell, transfer, pledge or assign any of the Subject Securities or any interest therein without Choom’s prior written consent.

Fairness Opinion

Phivida retained Haywood to act as the financial advisor to the Special Committee in connection with the Arrangement. Neither Haywood, nor any of its affiliates, is an insider, associate or affiliate of Choom or Phivida nor of any of their respective associates or affiliates.

The Special Committee requested that Haywood evaluate the fairness, from a financial point of view, of the consideration to be received by Phivida Shareholders pursuant to the Arrangement. On June 2, 2020, at a meeting of the Special Committee held to evaluate the Arrangement, Haywood delivered a verbal opinion, which was subsequently confirmed by delivery of the written Fairness Opinion dated June 2, 2020. The Fairness Opinion provides that, as of June 2, 2020, based upon and subject to the assumptions, limitations and qualifications set out therein, the consideration to be received by Phivida Shareholders pursuant to the Arrangement is fair, from a financial point of view, to the Phivida Shareholders.

After taking into consideration, among other things, the Fairness Opinion, the Special Committee unanimously determined that the Consideration to be received by the Phivida Shareholders is fair, from a financial point of view, and that the Arrangement is in the best interests of Phivida and its securityholders, and the Phivida Board unanimously approved the Arrangement and the Arrangement Agreement and recommends that the Phivida Shareholders vote their Phivida Shares in favour of the Special Resolution. The full text of the Fairness Opinion, which sets forth the assumptions made, procedures followed, matters considered, limitations and qualifications on the review undertaken in connection with the opinion, is attached as Appendix “F” to this Circular. Phivida Shareholders are urged to, and should, read the Fairness Opinion in its entirety.

Under the terms of its engagement, Haywood will be paid a fixed fee for the delivery of the Fairness Opinion, no portion of which is conditional upon the Fairness Opinion being favourable. Phivida has also agreed to reimburse Haywood for its reasonable out-of-pocket expenses whether or not the Arrangement is completed and to indemnify Haywood, its affiliates, and their respective directors, officers, employees, agents and controlling persons, against certain losses, claims, damages and liabilities which may arise directly or indirectly from services performed by Haywood in connection with its engagement.

Subject to the terms of its engagement, Haywood has consented to the inclusion in this Circular of the Fairness Opinion in its entirety, together with the summary herein and other information relating to the Fairness Opinion. The Fairness Opinion was provided to the Special Committee and Phivida Board for their exclusive use only in considering the Arrangement and may not be relied upon by any other person or used for any other purpose or published or disclosed to any other person without express written consent. The Fairness Opinion addresses only the fairness, from a financial point of view, of the consideration to

38 -

be received by Phivida Shareholders pursuant to the Arrangement and does not and should not be construed as a valuation of Phivida or Choom or their respective assets, liabilities or securities or as a recommendation to any Phivida Shareholder as to how to vote with respect to the Arrangement or any other matter at the Meeting.

The Arrangement Agreement

The following is a summary of the principal terms of the Arrangement Agreement. This summary does not purport to be complete and is qualified in its entirety by, in the case of the Arrangement Agreement, the complete text of the Arrangement Agreement, a copy of which is available under Phivida’s and Choom’s SEDAR profile at www.sedar.com and, in the case of the Plan of Arrangement, the complete text of the Plan of Arrangement, a copy of which is attached at Appendix “B” to this Circular.

On June 2, 2020, Phivida entered into the Arrangement Agreement with Choom pursuant to which they agreed that, subject to the terms and conditions set forth in the Arrangement Agreement (and among other things) Choom will acquire 100% of the Phivida Shares pursuant to a plan of arrangement under the BCBCA with Phivida Shareholders receiving, for each Phivida Share held, 0.72566 of a Choom Share. The terms of the Arrangement Agreement are the result of arm’s length negotiation between Phivida and Choom and their respective outside legal counsel and advisors.

Representations and Warranties

The Arrangement Agreement contains representations and warranties made by Phivida to Choom , and by Choom to Phivida. Those representations and warranties were made as of specific dates solely for the purposes of the Arrangement Agreement and are subject to important qualifications and limitations agreed to by the parties in connection with negotiating its terms. Moreover, some of the representations and warranties contained in the Arrangement Agreement are subject to a contractual standard of materiality (including, a Material Adverse Effect) that may be different from that considered material to Phivida Shareholders, or that may have been used for the purpose of allocating risk between the parties to the Arrangement Agreement rather than for the purpose of establishing facts. Information concerning the subject matter of the representations and warranties may have changed since the date of the Arrangement Agreement. For the foregoing reasons, you should not rely on the representations and warranties contained in the Arrangement Agreement as statements of factual information at the time they were made or otherwise.

The representations and warranties provided by Phivida in favour of Choom relate to, among other things: (a) capacity and authority; (b) authority relative to the Arrangement Agreement; (c) binding obligation; (d) reporting issuer status and securities law matters; (e) U.S. securities matters; (f) company filings; (g) no restrictive covenants; (h) absence of conflict; (i) consents; (j) permits; (k) regulatory approvals; (l) forward-looking information; (m) ownership of Subsidiaries; (n) corporate existence of Phivida and its Subsidiaries; (o) jurisdictions in which it is qualified to do business; (p) authorized and issued capital; (q) no cease trade orders; (r) corporate records, (s) financial statements and accounting matters; (t) tax matters; (u) absence of changes; (v) absence of unusual transactions; (w) title to and condition of assets; (x) owned and leased real property; (y) accounts receivable; (z) material contracts; (aa) compliance with laws; (bb) environmental conditions; (cc) privacy protection; (dd) intellectual property; (ee) employment matters; (ff) insurance; (gg) litigation; (hh) no expropriation; (ii) registration rights; (jj) rights of other persons; (kk) no voting control; (ll) directors and officers; (mm) corrupt practices legislation; (nn) antimoney laundering; (oo) brokerage fees; and (pp) fairness opinion and directors’ approvals.

39 -

The representations and warranties provided by Choom in favour of Phivida relate to, among other things: (a) capacity and authority; (b) authority relative to the Arrangement Agreement; (c) binding obligation; (d) reporting issuer status and securities law matters; (e) U.S. securities matters; (f) company filings; (g) no restrictive covenants; (h) absence of conflict; (i) consents; (j) permits; (k) regulatory approvals; (l) forward-looking information; (m) ownership of Subsidiaries; (n) corporate existence of Choom and its Subsidiaries; (o) jurisdictions in which it is qualified to do business; (p) authorized and issued capital; (q) securities issuable in connection with Arrangement; (r) no cease trade orders; (s) security ownership in Phivida; (t) corporate records; (u) financial statements and accounting matters; (v) tax matters; (w) absence of changes; (x) absence of unusual transactions; (y) title to and condition of assets; (z) owned and leased real property; (aa) accounts receivable; (bb) material contracts; (cc) compliance with laws; (dd) environmental conditions; (ee) privacy protection; (ff) intellectual property; (gg) employment matters; (hh) insurance; (ii) litigation; (jj) no expropriation; (kk) rights of other persons; (ll) no voting control; (mm) directors and officers; (nn) corrupt practices legislation; (oo) anti-money laundering; (pp) and brokerage fees.

The representations and warranties of Phivida and Choom contained in the Arrangement Agreement will not survive the completion of the Arrangement and will expire and be terminated on the earlier of the Effective Time and the date on which the Arrangement Agreement is terminated in accordance with its terms.

Conditions to the Arrangement

Mutual Conditions Precedent

The Parties are not required to complete the Arrangement unless each of the following conditions is satisfied, which conditions may only be waived in whole or in part by the mutual consent of each of the Parties:

(a) the Special Resolution having been approved and adopted by Phivida Shareholders at the Meeting in accordance with the Interim Order;
(b) the Interim Order and the Final Order having both been obtained on terms consistent with the Arrangement Agreement, and having not been set aside or modified in a manner unacceptable to either Phivida or Choom, each acting reasonably, on appeal or otherwise;
(c) the Consideration Shares being issuable upon completion of the Arrangement, and the Choom Shares being issuable upon the exercise from time to time of the Phivida Options, subject only to the satisfaction of customary conditions required by the CSE, having been approved for listing on the CSE as of the Effective Date and the CSE having, if required, accepted notice for filing of all transactions of the Parties contemplated in the Arrangement Agreement or necessary to complete the Arrangement, subject only to compliance with the usual requirements of the CSE;
(d) (i) the issuance of the Consideration Shares and Replacement Options being exempt from the registration requirements of the U.S. Securities Act pursuant to the Section 3(a)(10) Exemption;
(e) no Law being in effect that makes the consummation of the Arrangement illegal or otherwise prohibits or enjoins Phivida or Choom from consummating the Arrangement;
40 -
(f) the distribution of the Consideration Shares pursuant to the Arrangement being exempt from the prospectus and registration requirements of applicable Securities Laws either by virtue of exemptive relief from the securities regulatory authorities in the applicable provinces of Canada or by virtue of exemptions under applicable Securities Laws and not being subject to resale restrictions under applicable Securities Laws (other than as applicable to control persons or pursuant to Section 2.6 of National Instrument 45-102 – Resale of Securities );
(g) all Regulatory Approvals and all third Person and other consents, waivers, permits, exemptions, orders, approvals, agreements and amendments and modifications to agreements, indentures or arrangements, in each case, the failure of which to obtain or the non-expiry of which would, or could reasonably be expected to have, a Material Adverse Effect on Phivida or Choom or materially impede the completion of the Arrangement, having been obtained or received; and
(h) the Arrangement Agreement not having been terminated in accordance with its terms.

Additional Conditions in Favour of Choom

Choom is not required to complete the Arrangement unless each of the following additional conditions is satisfied, which conditions are for the exclusive benefit of Choom and may only be waived, in whole or in part, by Choom in its sole discretion:

(a) the representations and warranties of Phivida in respect of (i) capacity and authority, authority relative to the Arrangement Agreement, and binding obligation being true and correct in all respects as of the date of the Arrangement Agreement and as of the Effective Time as if made as at and as of such time; (ii) the representations and warranties of Phivida with respect to its capitalization being true and correct in all material respects as of the date of the Arrangement Agreement and as of the Effective Time as if made as at and as of such time; and (iii) all other representations and warranties of Phivida set forth in the Arrangement Agreement being true and correct in all respects (disregarding for purposes of this paragraph, any materiality or Material Adverse Effect qualification contained in any such representation or warranty) as of the date of the Arrangement Agreement and as of the Effective Time as if made at and as of such time (except that any such representation and warranty that by its terms speaks specifically as of the date of the Arrangement Agreement or another date, shall be true and correct in all respects as of such date), except in the case of this clause (iii) where the failure to be so true and correct in all respects, individually and in the aggregate, has not had or would not reasonably be expected to have a Material Adverse Effect on Phivida, and Phivida having delivered a certificate confirming same to Choom, executed by two of its senior officers (in each case without personal liability) addressed to Choom and dated the Effective Date;
(b) Phivida fulfilling or complying in all material respects with its covenants contained in the Arrangement Agreement required to be fulfilled or complied with by it on or prior to the Effective Date and having delivered a certificate confirming same to Choom executed by two of its senior officers (in each case without personal liability) addressed to Choom and dated the Effective Date;
(c) there being no action or proceeding pending or threatened by any Person (other than Choom or its affiliates) in any jurisdiction that is reasonably likely to: (i) cease trade, enjoin, prohibit, or impose any limitations, damages or conditions on, Choom’s ability to acquire, hold, or exercise full rights of ownership over, any Phivida Shares, including the right to vote Phivida Shares; (ii) prohibit or restrict the Arrangement, or the ownership or operation by Choom of a material
41 -

portion of the business or assets of Choom or any of Choom’s Subsidiaries, Phivida or any of Phivida’s Subsidiaries, or compel Choom to dispose of or hold separate any material portion of the business or assets of Choom or any of Choom’s Subsidiaries, Phivida or any of Phivida’s Subsidiaries as a result of the Arrangement; or (iii) prevent or materially delay the consummation of the Arrangement, or if the Arrangement is consummated, have or be reasonably expected to have a Material Adverse Effect;

(d) since the date of the Arrangement Agreement, there will not have occurred, or have been disclosed to the public (if previously undisclosed to the public), any change, event, occurrence, effect or circumstance that, individually or in the aggregate with other changes, events, occurrences, effects or circumstances, has had or could reasonably be expected to have a Material Adverse Effect on Phivida or any of its Subsidiaries, and Phivida will have delivered a certificate confirming same to Choom, executed by two of its senior officers (in each case without personal liability) addressed to Choom and dated the Effective Date;
(e) Dissent Rights having not been exercised (excluding any dissent rights that have been exercised and subsequently withdrawn) with respect to more than 5% of the issued and outstanding Phivida Shares;
(f) no litigation or arbitration having been commenced nor any demand letter having been received which in Choom’s opinion, acting reasonably, could result in (individually or in the aggregate) claims against Phivida (or any of its Subsidiaries) that could reasonably be expected to have a Material Adverse Effect on Phivida; and
(g) Phivida having a working capital surplus of not less than $1,500,000 at the Effective Time, calculated based on current assets minus current liabilities, excluding lease liabilities and capital expenditures (as such terms are defined under IFRS).

Additional Conditions in Favour of Phivida

Phivida is not required to complete the Arrangement unless each of the following additional conditions is satisfied, which conditions are for the exclusive benefit of Phivida and may only be waived, in whole or in part, by Phivida in its sole discretion:

(a) the representations and warranties of Choom in respect of (i) capacity and authority, authority relative to the Arrangement Agreement and binding obligation being true and correct in all respects as of the date of the Arrangement Agreement and as of the Effective Time as if made as at and as of such time; (ii) the representations and warranties of Choom with respect to its capitalization being true and correct in all material respects as of the date of the Arrangement Agreement and as of the Effective Time as if made as at and as of such time; and (iii) all other representations and warranties of Choom set forth in the Arrangement Agreement being true and correct in all respects (disregarding for purposes of this paragraph, any materiality or Material Adverse Effect qualification contained in any such representation or warranty) as of the date of the Arrangement Agreement and as of the Effective Time as if made at and as of such time (except that any such representation and warranty that by its terms speaks specifically as of the date of the Arrangement Agreement or another date, shall be true and correct in all respects as of such date), except in the case of this clause (iii) where the failure to be so true and correct in all respects, individually and in the aggregate, has not had or would not reasonably be expected to have a Material Adverse Effect on Choom, and Choom having delivered a certificate confirming
42 -

same to Phivida, executed by two of its senior officers (in each case without personal liability) addressed to Phivida and dated the Effective Date;

(b) Choom fulfilling or complying in all material respects with each of its covenants contained in the Arrangement Agreement required to be fulfilled or complied with by it on or prior to the Effective Date and having delivered a certificate confirming same to Phivida executed by two of its senior officers (in each case without personal liability) addressed to Phivida and dated the Effective Date;
(c) there being no action or proceeding pending or threatened by any Person (other than Phivida) in any jurisdiction that is reasonably likely to: (i) cease trade, enjoin, prohibit, or impose any limitations, damages or conditions on, Choom’s ability to issue the Consideration Shares or the Choom Shares to be issued upon exercise from time to time of the Phivida Options; or (ii) prevent or materially delay the consummation of the Arrangement, or if the Arrangement is consummated, have or be reasonably expected to have a Material Adverse Effect;
(d) since the date of the Arrangement Agreement, there shall not have occurred, or have been disclosed to the public (if previously undisclosed to the public) any change, event, occurrence, effect or circumstance that, individually or in the aggregate with other changes, events, occurrences, effects or circumstances, has had or could reasonably be expected to have a Material Adverse Effect on Choom or any of its Subsidiaries, and Choom has delivered a certificate confirming same to Phivida, executed by two (2) senior officers of Choom (in each case without personal liability) addressed to Phivida and dated the Effective Date;
(e) Choom having taken such steps to appoint to the Choom Board one director nominated by Phivida, and one director to be mutually agreed upon by Phivida and Choom, each acting reasonably, in each case to serve as directors of Choom as of the Effective Time;
(g) no litigation or arbitration having been commenced by, nor any demand letter having been received which in Phivida’s opinion, acting reasonably, could result in (individually or in the aggregate) claims against Choom (or any of its Subsidiaries) that could reasonably be expected to have a Material Adverse Effect on Choom;
(h) Choom having a working capital deficit of not more than $500,000 at the Effective Time, calculated based on current assets minus current liabilities, excluding lease liabilities and capital expenditures (as such terms are defined under IFRS) and those items disclosed in writing to Phivida;
(i) Choom having all Permits required to operate Choom’s business and not requiring any Permit or other approval from a Governmental Entity not yet obtained at the Effective Time which would cause any existing Permit to be canceled or would materially impede the ability of Choom to operate Choom’s business or to consummate the Arrangement and the transactions contemplated thereby; and
(j) the Debenture Right having not been exercised.
43 -

Covenants

General

In the Arrangement Agreement, Phivida and Choom have agreed to certain covenants, including (i) customary covenants relating to the operation of their respective businesses in the ordinary course, (ii) subject to the terms and conditions of the Arrangement Agreement, covenants to perform all obligations required to be performed under the Arrangement Agreement, to cooperate with the other Parties in connection therewith, and to do all such other commercially reasonable acts and things as may be necessary or desirable to consummate and make effective, as soon as reasonably practicable, the Arrangement, and (iii) covenants concerning access to information, confidentiality and public communications.

Covenants of Choom Relating to the Consideration Shares

The Arrangement Agreement provides that Choom will, on or before the Effective Date, reserve a sufficient number of Consideration Shares to be issued upon completion of the Arrangement and Choom Shares to be issued upon the exercise from time to time of the Phivida Options.

Additional Covenants Regarding Non-Solicitation

Mutual Non-Solicitation

The Arrangement Agreement contains provisions regarding non-solicitation as follows:

(a) Except as expressly provided in the non-solicitation provisions in the Arrangement Agreement, a Party shall not, directly or indirectly, through any officer, director, employee, representative (including any financial or other adviser) or an agent of it or any of its respective Subsidiaries (collectively “ Representatives ”, which for greater certainty does not include a shareholder of a Party who is not otherwise an officer, director, employee, representative (including any financial or other adviser) or an agent of such Party or any of its respective Subsidiaries), or otherwise, and shall not permit any such Person to:
(i) solicit, initiate, knowingly facilitate, encourage or promote (including by way of furnishing or providing copies of, access to, or disclosure of, any confidential information, properties, facilities, books or records of the Party or any Subsidiary or entering into any form of agreement, arrangement or understanding) any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to, an Acquisition Proposal;
(ii) enter into or otherwise engage or participate in any discussions or negotiations with any Person (other than the other Party or any of its affiliates) regarding any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to, an Acquisition Proposal, it being acknowledged and agreed that the Party may communicate with any Person for purposes of advising such Person of the restrictions in the Arrangement Agreement and, in the case of Phivida, also advising such Person that their Acquisition Proposal does not constitute a Superior Proposal and, in the case of Choom, advising such Person that their Acquisition Proposal does not constitute a Competing
44 -

Transaction or is not reasonably expected to constitute or lead to a Competing Transaction; or

(iii) enter into or publicly propose to enter into any agreement, understanding or arrangement in respect of an Acquisition Proposal (other than a confidentiality and standstill agreement permitted by and in accordance with the non-solicitation provisions in the Arrangement Agreement).
(b) Except as expressly provided in the non-solicitation provisions in the Arrangement Agreement, Phivida shall not, directly or indirectly, through any Representative or otherwise, and shall not permit any such Person to: (i) make a Change in Recommendation; or (ii) accept, approve, endorse or recommend, or publicly propose to accept, approve, endorse or recommend, or take no position or remain neutral with respect to, any publicly announced or otherwise publicly disclosed Acquisition Proposal in respect of Phivida (it being understood that taking no position or a neutral position with respect to a publicly announced or otherwise publicly disclosed Acquisition Proposal in respect of Phivida for a period of no more than five (5) Business Days following the announcement or disclosure of such Acquisition Proposal will not be considered to be in violation of the non-solicitation provisions in the Arrangement Agreement, provided the Phivida Board has rejected such Acquisition Proposal and affirmed its intention to proceed with the Arrangement before the end of such five (5) Business Day period).
(c) Except as expressly provided in the non-solicitation provisions in the Arrangement Agreement, Choom shall not, directly or indirectly, through any Representative or otherwise, and shall not permit any such Person to accept, approve, endorse or recommend, or publicly propose to accept, approve, endorse or recommend, or take no position or remain neutral with respect to, any publicly announced or otherwise publicly disclosed Acquisition Proposal in respect of Choom (it being understood that taking no position or a neutral position with respect to a publicly announced or otherwise publicly disclosed Acquisition Proposal in respect of Choom for a period of no more than five (5) Business Days following the announcement or disclosure of such Acquisition Proposal will not be considered to be in violation of the non-solicitation provisions in the Arrangement Agreement, provided the Choom Board has rejected such Acquisition Proposal and affirmed its intention to proceed with the Arrangement before the end of such five (5) Business Day period).
(d) Each Party shall, and shall cause its Subsidiaries and its Representatives to, immediately cease and terminate, and cause to be terminated, any solicitation, encouragement, discussion, negotiations, or other activities commenced prior to the date of the Arrangement Agreement with any Person (other than the other Party and its affiliates) with respect to any inquiry, proposal or offer that constitutes, or may reasonably be expected to constitute or lead to, an Acquisition Proposal, and in connection with such termination shall no longer provide access to any data room or provide any new disclosure of information, or access to properties, facilities, books and records of the Party or any of its Subsidiaries outside the ordinary course.

Responding to an Acquisition Proposal

Notwithstanding the non-solicitation provisions in the Arrangement Agreement, if a Party or any of its Subsidiaries or any of their Representatives, who has received , or otherwise become aware of any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to an Acquisition

45 -

Proposal, or any request for copies of, access to, or disclosure of, confidential information that is made, or that may reasonably be perceived to be made, in connection with an Acquisition Proposal, at any time prior to obtaining the approval by Phivida Shareholders of the Special Resolution, the Party in receipt of such inquiry, proposal or offer (the “ Notified Party ”) upon receiving a written Acquisition Proposal may engage in or participate in discussions or negotiations with such Person regarding such Acquisition Proposal, and may provide copies of, access to or disclosure of confidential information, properties, facilities, books or records of the Notified Party and its Subsidiaries if, and only if:

(a) the Notified Party Board first determines in good faith, after consultation with its financial advisors and its outside legal counsel, that such Acquisition Proposal constitutes or could reasonably be expected to constitute or lead to, in the case of Phivida, a Superior Proposal (disregarding for such determination any due diligence or access condition) or in the case of Choom, a Competing Transaction (disregarding for such determination any due diligence or access condition);
(b) such Person was not restricted from making such Acquisition Proposal pursuant to an existing standstill or similar restriction;
(c) the Notified Party has been, and continues to be, in compliance with its obligations under the non-solicitation provisions in the Arrangement Agreement;
(d) prior to providing any such copies, access, or disclosure, the Notified Party enters into a confidentiality and standstill agreement with such Person having terms that are not less onerous than those set out in the confidentiality agreement between Phivida and Choom and any such copies, access or disclosure provided to such Person shall have already been (or simultaneously be) provided to the other Party; and
(e) the Notified Party promptly provides the other Party with, prior to providing any such copies, access or disclosure, a true, complete and final executed copy of the confidentiality and standstill agreement with such Person.

Nothing contained in the Arrangement Agreement shall prevent the Notified Party Board from:

(a) complying with Section 2.17 of National Instrument 62-104 – Takeover Bids and Issuer Bids and similar provisions under Securities Laws relating to the provision of a directors’ circular in respect of an Acquisition Proposal; or
(b) calling and/or holding a meeting of shareholders requisitioned by Phivida Shareholders or the shareholders of Choom, as applicable, in accordance with applicable Laws or taking any other action with respect to an Acquisition Proposal to the extent ordered or otherwise mandated by a court of competent jurisdiction in accordance with applicable Laws.

Choom Right to Match

If Phivida receives an Acquisition Proposal that constitutes a Superior Proposal prior to the approval of the Special Resolution by Phivida Shareholders, the Phivida Board may authorize Phivida to, subject to compliance with the termination fee provisions in the Arrangement Agreement, make a Change in Recommendation and enter into a definitive agreement with respect to such Superior Proposal, if and only if:

46 -
(a) the Person making the Superior Proposal was not restricted from making such Superior Proposal pursuant to an existing standstill or similar restriction;
(b) Phivida has been, and continues to be, in compliance with its obligations under the nonsolicitation provisions in the Arrangement Agreement;
(c) Phivida has delivered to Choom a written notice of the determination of the Phivida Board that such Acquisition Proposal constitutes a Superior Proposal and of the intention of the Phivida Board to enter into a definitive agreement with respect to such Superior Proposal, together with a written notice from the Phivida Board regarding the value and financial terms that the Phivida Board, in consultation with its financial advisors, has determined should be ascribed to any noncash consideration offered under such Superior Proposal;
(d) Phivida has provided Choom with a copy of the proposed definitive agreement for the Superior Proposal;
(e) at least seven (7) Business Days (the “ Choom Matching Period ”) have elapsed from the date that is the later of the date on which Choom received the Superior Proposal notice from Phivida and the date on which Choom received a copy of the proposed definitive agreement for the Superior Proposal from Phivida;
(f) during any Choom Matching Period, Choom have had the opportunity (but not the obligation) to offer to Phivida to amend the Arrangement Agreement and the Arrangement in order for such Acquisition Proposal to cease to be a Superior Proposal;
(g) if Choom has offered to Phivida to amend the Arrangement Agreement and the Arrangement, the Phivida Board has determined in good faith, after consultation with Phivida’s outside legal counsel and financial advisers, that such Acquisition Proposal continues to constitute a Superior Proposal compared to the terms of the Arrangement as proposed to be amended by Choom;
(h) the Phivida Board has determined in good faith, after consultation with Phivida’s outside legal counsel that it is appropriate for the Phivida Board to enter into a definitive agreement with respect to such Superior Proposal; and
(i) prior to or concurrent with entering into such definitive agreement, Phivida terminates the Arrangement Agreement pursuant to certain termination provisions in the Arrangement Agreement and pays the Termination Fee pursuant to the termination fee provisions of the Arrangement Agreement to Choom.

During the Choom Matching Period, or such longer period as Phivida may approve in writing for such purpose: (a) the Phivida Board shall review any offer made by Choom to amend the terms of the Arrangement Agreement and the Arrangement in good faith, in consultation with Phivida’s outside legal counsel and financial advisers, in order to determine whether such proposal would, upon acceptance, result in the Acquisition Proposal previously constituting a Superior Proposal ceasing to be a Superior Proposal; and (b) if the Phivida Board determines that such Acquisition Proposal would cease to be a Superior Proposal as a result of such amendment, Phivida shall negotiate in good faith with Choom to make such amendments to the terms of the Arrangement Agreement and the Arrangement as would enable Choom to proceed with the transactions contemplated by the Arrangement Agreement on such amended terms. If the Phivida Board determines that such Acquisition Proposal would cease to be a

47 -

Superior Proposal, Phivida shall promptly so advise Choom and the Parties shall amend the Arrangement Agreement to reflect such offer made by Choom, and shall take and cause to be taken all such actions as are necessary to give effect to the foregoing.

Each successive amendment or modification to any Acquisition Proposal in respect of Phivida shall constitute a new Acquisition Proposal and Choom shall be afforded a new Choom Matching Period from the later of the date on which Choom received the new Superior Proposal notice from Phivida and the date on which Choom received a copy of the proposed definitive agreement for the new Superior Proposal from Phivida.

At Choom’s request, the Phivida Board shall promptly reaffirm its determination that Phivida Shareholders vote in favour of the Special Resolution by press release after the Phivida Board determines that an Acquisition Proposal is not a Superior Proposal or the Phivida Board determines that a proposed amendment to the terms of the Arrangement Agreement would result in an Acquisition Proposal no longer being a Superior Proposal. Phivida shall provide Choom and its outside legal counsel with a reasonable opportunity to review the form and content of any such press release and shall make all reasonable amendments to such press release as requested by Choom and its outside legal counsel.

If Phivida provides a Superior Proposal notice to Choom on or after a date that is less than seven (7) Business Days before the Meeting, Phivida shall postpone the Meeting to a date acceptable to both Parties (acting reasonably) that is not more than 10 Business Days after the scheduled date of the Meeting but before the Outside Date.

Phivida Right to Match

In respect of a Competing Transaction for Choom, the Arrangement Agreement contains right to match provisions in favour of Phivida similar to those entered into by Phivida in favour of Choom, as described above, as applicable, provided however that Choom must pay the Termination Fee pursuant to the termination fee provisions of the Arrangement to Phivida.

Termination of the Arrangement Agreement

The Arrangement Agreement may be terminated prior to the Effective Time by:

(a) the mutual written agreement of the Parties; or
(b) either of the Parties if:
(i) the Required Approval is not obtained at the Meeting in accordance with the Interim Order, provided that a Party may not terminate the Arrangement Agreement pursuant to the foregoing if the failure to obtain the Required Approval has been caused by, or is a result of, a breach by such Party of any of its representations or warranties or the failure of such Party to perform any of its covenants or agreements under the Arrangement Agreement;
(iii) after the date of the Arrangement Agreement, any Law is enacted, made, enforced or amended, as applicable, that makes the consummation of the Arrangement illegal or otherwise permanently prohibits or enjoins Phivida or Choom from consummating the Arrangement, and such Law has, if applicable, become final and non-appealable, provided
48 -

the Party seeking to terminate the Arrangement Agreement pursuant to the foregoing has used its commercially reasonable efforts to, as applicable, appeal or overturn such Law or otherwise have it lifted or rendered non-applicable in respect of the Arrangement; or

(iv) the Effective Time does not occur by the Outside Date, provided that a Party may not terminate the Arrangement Agreement pursuant to the foregoing if the failure of the Effective Time to so occur has been caused by, or is a result of, a breach by such Party of any of its representations or warranties or the failure of such Party to perform any of its covenants or agreements under the Arrangement Agreement; or
(c) Phivida if:
(i) a breach of any representation or warranty or failure to perform any covenant or agreement on the part of Choom under the Arrangement Agreement occurs that would cause any condition in favour of Phivida that relates to the accuracy of Choom’s representations and warranties or Choom’s compliance with its covenants not to be satisfied, and such breach or failure is incapable of being cured or is not cured on or prior to the Outside Date in accordance with certain terms of the Arrangement Agreement; provided that Phivida is not then in breach of the Arrangement Agreement so as to cause any condition in favour of Choom not to be satisfied;
(ii) prior to the approval by Phivida Shareholders of the Special Resolution, the Phivida Board authorizes Phivida to accept, approve or recommend or enter into a definitive written agreement with respect to a Superior Proposal (other than a confidentiality and standstill agreement permitted by and in accordance with the Arrangement Agreement), provided Phivida is then in compliance with the obligations under its non-solicitation covenants in the Arrangement Agreement and that prior to or concurrent with such termination Phivida pays the Termination Fee in accordance with the Arrangement Agreement;
(iii) Choom breaches the non-solicitation provisions in the Arrangement Agreement in any material respect;
(iv) a Material Adverse Effect event of Choom occurs or the Debenture Right is exercised, as a result of which the related condition to closing is not capable of being satisfied or cured, as the case may be, by the Outside Date; or
(v) any other mutual condition or condition of Phivida in the Arrangement Agreement is not satisfied, and such condition is incapable of being satisfied at the completion of the Arrangement; or

(d) Choom if:

(i) a breach of any representation or warranty or failure to perform any covenant or agreement on the part of Phivida under the Arrangement Agreement occurs that would cause any condition in favour of Choom that relate to the accuracy of Phivida’s representations and warranties or Phivida’s compliance with its covenants not to be satisfied, and such breach or failure is incapable of being cured or is not cured on or prior to the Outside Date in accordance with certain terms of the Arrangement Agreement;
49 -

provided that Choom is not then in breach of the Arrangement Agreement so as to cause any condition in favour of Phivida not to be satisfied;

(ii) other than as permitted under the non-solicitation covenants in the Arrangement Agreement, the Phivida Board or any committee of the Phivida Board fails to unanimously recommend or withdraws, amends, modifies or qualifies, publicly proposes or states its intention to do so, or fails to publicly reaffirm (without qualification) within five Business Days after having been requested in writing by Choom to do so, its recommendation that Phivida Shareholders vote in favour of the Special Resolution, or takes no position or a neutral position with respect to an Acquisition Proposal in respect of Phivida for more than five Business Days after first learning of an Acquisition Proposal in respect of Phivida or takes any other action that is or becomes disclosed publicly and which can reasonably be interpreted to indicate that the Phivida Board or a committee of the Phivida Board does not unanimously support the Arrangement and the Arrangement Agreement or does not unanimously believe that the Arrangement and the Arrangement Agreement are in the best interests of Phivida and its security holders (in each case, a “ Change in Recommendation ”), or the Phivida Board or any committee of the Phivida Board resolves or proposes to take any of the foregoing actions;
(iii) Phivida breaches the non-solicitation provisions in the Arrangement Agreement in any material respect;
(iv) prior to the approval by Phivida Shareholders of the Special Resolution, Choom enters into a definitive written agreement with respect to a Competing Transaction (other than a confidentiality and standstill agreement permitted by and in accordance with the Arrangement Agreement), provided Choom is then in compliance with the obligations under its non-solicitation covenants in the Arrangement Agreement and that prior to or concurrent with such termination Choom pays the Termination Fee in accordance with the Arrangement Agreement;
(v) a Material Adverse Effect event of Phivida occurs or Dissent Rights have been exercised with respect to 5% or more of the issued and outstanding Phivida Shares, as a result of which the related condition to closing is not capable of being satisfied by the Outside Date; or
(vi) any other mutual condition or condition of Choom in the Arrangement Agreement is not satisfied, and such condition is incapable of being satisfied at the completion of the Arrangement.

Termination Fee

Phivida is required to pay Choom the Termination Fee as liquidated damages at the times determined in accordance with the Arrangement Agreement in the event the Arrangement Agreement is terminated by Choom: (i) as a result of a Change in Recommendation; (ii) if Phivida breaches its non-solicitation obligations under the Arrangement Agreement, or in the event the Arrangement Agreement is terminated by Phivida to accept, approve or recommend or enter into a definitive written agreement with respect to a Superior Proposal.

50 -

Choom is required to pay Phivida the Termination Fee as liquidated damages at the times determined in accordance with the Arrangement Agreement in the event the Arrangement Agreement is terminated by Choom in order for Choom to enter into a definitive written agreement with respect to a Competing Transaction or in the event the Arrangement Agreement is terminated by Phivida if Choom breaches its non-solicitation obligations under the Arrangement Agreement.

Expense Reimbursement

Subject to the terms of the Arrangement Agreement, in the event that Choom does not complete the Arrangement as a result of Phivida’s inability to satisfy the condition that it have a working capital surplus of not less than $1,500,000, then Phivida will be required to pay a $250,000 expense reimbursement to Choom, within the timeframes stipulated in the Arrangement Agreement.

Subject to the terms of the Arrangement Agreement, in the event that Phivida does not complete the Arrangement as a result of Choom’s inability to satisfy the condition that: (i) it have a working capital deficit of not more than $500,000 at the Effective Time; or (ii) that the Debenture Right has not been exercised, then, in either case, Choom will be required to pay Phivida a $250,000 expense reimbursement to Phivida, within the timeframes stipulated in the Arrangement Agreement.

Governing Law

The Arrangement Agreement is governed by and interpreted and enforced in accordance with the Laws of the Province of British Columbia and the federal laws of Canada applicable therein. Each Party has irrevocably attorned and submitted to the non-exclusive jurisdiction of the courts situated in the City of Vancouver and waives objection to the venue of any proceeding in such court or that such court provides an inconvenient forum.

Amendment

The Arrangement Agreement and the Plan of Arrangement may, at any time and from time to time before or after the holding of the Meeting but not later than the Effective Time, be amended by mutual written agreement of the Parties, and any such amendment may, subject to the Interim Order and the Final Order and applicable Law, without limitation:

(a) change the time for performance of any of the obligations or acts of the Parties;
(b) modify any representation or warranty contained in the Arrangement Agreement or in any document delivered pursuant to the Arrangement Agreement;
(c) waive compliance with or modify any inaccuracies or any of the covenants contained in the Arrangement Agreement and waive or modify performance of any of the obligations of the Parties; and/or
(d) waive compliance with or modify any mutual conditions contained in the Arrangement Agreement.
51 -

Conduct of the Meeting and Other Approvals

Required Phivida Shareholder Approval

At the Meeting, the Phivida Shareholders will be asked to consider and, if deemed advisable, pass the Special Resolution as set forth in Appendix “A” to this Circular.

Pursuant to the terms of the Interim Order, the Special Resolution must, subject to further order of the Court, be approved by not less than two-thirds of the votes cast by the Phivida Shareholders present in person or represented by proxy at the Meeting voting together as a single class.

Notwithstanding the foregoing, the Special Resolution authorizes the Phivida Board, without further notice to or approval of the Phivida Shareholders, subject to the terms of the Arrangement Agreement, to amend the Arrangement Agreement or the Plan of Arrangement or to decide not to proceed with the transactions contemplated by the Arrangement Agreement at any time prior to the Effective Time.

Court Approvals

If the Special Resolution is approved by the requisite majority, then final approval of the Court must be obtained before the Arrangement may proceed.

Regulatory Approvals

The Phivida Shares are listed for trading on the CSE and Phivida is a reporting issuer in the Provinces of British Columbia, Alberta, Ontario and New Brunswick. The Choom Shares are currently listed for trading on the CSE and Choom is a reporting issuer in the Provinces of British Columbia, Alberta, Saskatchewan and Ontario. It is expected that, following completion of the Arrangement, the Choom Shares will continue to be listed for trading on the CSE under the symbol “CHOO”. Following completion of the Arrangement, Choom intends to have the Phivida Shares delisted from the CSE and for Phivida to cease to be a “reporting issuer” in all of the Provinces in which it is a “reporting issuer”.

Exchange of Phivida Shares

Procedure for Exchange of Phivida Shares

Concurrent with the mailing of this Circular, Phivida will also mail a Letter of Transmittal to Registered Phivida Shareholders, which will be used by such Registered Phivida Shareholders to exchange their certificate(s) and/or DRS Advice(s) representing Phivida Shares for DRS Advices and/or certificates representing Choom Shares. Until exchanged, each certificate representing Phivida Shares will, after the Effective Time, represent only the right to receive, upon surrender, Choom Shares.

52 -

The exchange of Phivida Shares for the Choom Shares in respect of Non-Registered Holders is expected to be made with the Non-Registered Holders’ nominee (bank, trust company, securities broker or other nominee) account through the procedures in place for such purposes between CDS and such nominee. Non-Registered Holders should contact their nominee if they have any questions regarding this process and to arrange for their nominee to complete the necessary steps to ensure that they receive the Choom Shares.

Former Registered Phivida Shareholders must deliver to the Depositary: (a) their DRS Advice(s) and/or certificate(s) representing such Phivida Shares; (b) a duly completed Letter of Transmittal; and (c) such other documents as the Depositary may require, in order to receive DRS Advices and/or certificates representing the Choom Shares to which they are entitled pursuant to the Arrangement. Choom reserves the right if it so elects in its absolute discretion to instruct the Depositary to waive any defect or irregularity contained in any Letter of Transmittal received by the Depositary.

Physical certificates and/or DRS Advices for the Choom Shares of a former Registered Phivida Shareholder who provides the appropriate documentation described above, will be registered in such name or names and will be delivered to such address or addresses as such holder may direct in the Letter of Transmittal as soon as practicable following the Effective Date and after receipt by the Depositary all of the required documents.

Cancellation of Rights after Six Years

A Registered Phivida Shareholder that does not submit an effective Letter of Transmittal prior to the Effective Date may take delivery of the DRS Advices and/or physical certificate(s) representing the Choom Shares by delivering a duly completed Letter of Transmittal, the certificate(s) representing Phivida Shares formerly held by it and such other documents as the Depositary may require, to the Depositary at the office indicated in the Letter of Transmittal at any time prior to the sixth anniversary of the Effective Date.

Upon the expiry of six years from the Effective Date, each DRS Advice and/or certificate representing former Phivida Shares will cease to represent any claims against or interest of any kind or nature in Phivida, Choom or the Depositary.

Lost or Stolen Certificates

In the event any certificate, which immediately before the Effective Time represented one or more outstanding Phivida Shares that was exchanged pursuant to the Plan of Arrangement, is lost, stolen or destroyed, upon the making of an affidavit of that fact by the Person claiming such certificate to be lost, stolen or destroyed, the Depositary will issue in exchange for such lost, stolen or destroyed certificate, the Consideration to which such Person is entitled in respect of the Phivida Shares represented by such lost, stolen or destroyed certificate pursuant to the Plan of Arrangement deliverable in accordance with such Person’s Letter of Transmittal. When authorizing such delivery of Choom Shares that such holder is entitled to receive in exchange for such lost, stolen or destroyed certificate, the Person to whom such Choom Shares are to be delivered shall, as a condition precedent to the delivery of such Choom Shares, give a bond satisfactory to Choom and the Depositary in such sum as Choom and the Depositary may direct and indemnify Choom and the Depositary in a manner satisfactory to Choom and the Depositary, against any claim that may be made against Choom or the Depositary with respect to the certificate alleged to have been lost, stolen or destroyed.

53 -

No Fractional Shares to be Issued

No fractional Choom Shares shall be issued to any former Phivida Shareholder. The number of Choom Shares to be issued to a former Phivida Shareholder shall be rounded down to the nearest whole Choom Share with no consideration being paid for the fractional share.

Treatment of Phivida Options

Each Phivida Option which is outstanding and has not been duly exercised prior to the Effective Time (whether vested or unvested), notwithstanding the terms of the Phivida Option Plan, will be exchanged for an option (each, a “ Replacement Option ”) to purchase from Choom such number of Choom Shares equal to the product obtained when (i) the number of Phivida Shares subject to the Phivida Option immediately prior to the Effective Time is multiplied by (ii) 0.72566 (rounding down any resulting fractional share interest to the nearest whole number of Choom Shares). Each Replacement Option shall provide for an exercise price per Choom Share equal to the quotient obtained when (i) the exercise price per Phivida Share subject to each such Phivida Option immediately before the Effective Time is divided by (ii) 0.72566 (rounding up to the nearest whole cent) . All other terms and conditions of the Replacement Options, including vesting, the term to expiry, conditions to and manner of exercising, will remain the same and shall be governed by the terms of the Phivida Option Plan and any certificate or option agreement previously evidencing the Phivida Option shall thereafter evidence and be deemed to evidence such Replacement Option. It is intended that subsection 7(1.4) of the Tax Act apply to such exchange of options. Accordingly, and notwithstanding the foregoing, if required, the exercise price of a Replacement Option will be increased such that the In-The-Money Amount of the Replacement Option immediately after the exchange does not exceed the In-The-Money Amount of the Phivida Option immediately before the exchange. “ In-The-Money Amount ” in respect of a stock option means the amount, if any, by which the aggregate fair market value at that time of the securities subject to the option exceeds the aggregate exercise price of the option.

Effective Date of Arrangement

If (a) the Special Resolution is approved at the Meeting; (b) the Final Order is obtained approving the Arrangement; (c) the required regulatory approvals to the Arrangement have been received by Choom and Phivida; (d) every requirement of the BCBCA relating to the Arrangement has been complied with; and (e) all other conditions disclosed under “ Information Concerning the Arrangement – The Arrangement Agreement – Conditions to the Closing ” and all other conditions contained in the Arrangement Agreement have been satisfied or waived and all documents agreed to be delivered under the Arrangement Agreement have been delivered, the Arrangement will become effective on the Effective Date at the Effective Time.

Notwithstanding the approval of the Special Resolution by the Phivida Shareholders and subject to the terms of the Arrangement Agreement, the Special Resolution authorizes the directors of Phivida not to proceed with the Arrangement without further approval from the Phivida Shareholders.

Other Transactions

On July 23, 2020, Phivida provided a bridge loan to Choom in the aggregate principal amount of $500,000 (the “ Bridge Loan ”), which Bridge Loan is evidenced by a convertible secured promissory note between Choom and Phivida. The Bridge Loan bears interest at a rate of 15% per annum on the outstanding principal sum. The aggregate principal amount of the Bridge Loan and accrued and unpaid interest

54 -

thereon is, in certain circumstances, convertible into Choom Shares, at a conversion price of $0.115 per share. Certain of Choom’s subsidiaries have also guaranteed Choom’s obligations under the Bridge Loan. In addition, Choom and the guarantor subsidiaries have granted Phivida a third-ranking security interest over all of their respective present and after-acquired property. The security interest is governed in accordance with the terms and conditions of a security agreement between Choom and the guarantors, and Phivida, dated July 23, 2020. In connection with the Bridge Loan, Choom also granted Phivida non-transferable warrants to purchase up to 4,347,826 Choom Shares (the “ Bridge Loan Warrants ”). Each Bridge Loan Warrant entitles Phivida to acquire one Choom Share at an exercise price of $0.115 per share for a period of three years from the date of issuance (subject to automatic earlier expiry immediately prior to the consummation of the transactions contemplated by the Arrangement). The Bridge Loan Warrants are only exercisable from and after the termination of the Arrangement Agreement for any reason other than as a result of a breach of the Arrangement Agreement by Phivida.

Dissent Rights in Respect of the Arrangement

There is no mandatory statutory right of dissent and appraisal in respect of plans of arrangement under the BCBCA. However, as contemplated in the Plan of Arrangement and the Interim Order, Phivida and Choom have granted to Registered Phivida Shareholders who object to the Arrangement the Dissent Rights, which are set out in their entirety in Sections 237 to 247 of the BCBCA, as may be modified by the Interim Order and the Plan of Arrangement, copies of which are attached as Appendix “E”, Appendix “C” and Appendix “B”, respectively, to this Circular, and as may be modified by the Final Order. A Registered Phivida Shareholder who wishes to exercise its Dissent Rights must strictly comply with the requirements of the Dissent Rights and failure to do so may result in the loss of such shareholder’s Dissent Rights . Accordingly, each Phivida Shareholder who might desire to exercise Dissent Rights should carefully consider and comply with the Dissent Rights and consult his, her or its legal advisor. See “ Rights of Dissenting Shareholders ”.

Risks Associated with the Arrangement

Phivida Shareholders should carefully consider all of the information disclosed or referred to in this Circular prior to voting on the matters being put before them at the Meeting. In addition to the other information presented in this Circular, the following risk factors should be given special consideration:

The Arrangement Agreement may be terminated in certain circumstances.

Choom has the right to terminate the Arrangement Agreement in certain circumstances, including in circumstances outside the control of Phivida, such as the Required Approval of the Special Resolution not being obtained. Accordingly, there is no certainty, nor can Phivida provide any assurance, that the Arrangement Agreement will not be terminated by Choom before the completion of the Arrangement.

There can be no certainty that all conditions precedent to the Arrangement will be satisfied.

The completion of the Arrangement is subject to a number of conditions precedents, certain of which are outside the control of Phivida, including receipt of the Final Order. There can be no certainty, nor can Phivida provide any assurance, that these conditions will be satisfied or, if satisfied, when they will be satisfied.

55 -

Phivida will incur costs.

Certain costs related to the Arrangement, such as legal, accounting and certain financial advisor fees, must be paid by Phivida even if the Arrangement is not completed.

Phivida and Choom may not realize the currently anticipated benefits of the Arrangement due to challenges associated with integrating the operations, technologies and personnel of Phivida with Choom.

The anticipated success of the combined company following the Arrangement will depend in large part on the success of management of Choom in integrating the operations, technologies and personnel of Phivida with those of Choom after the Effective Date. The failure of Choom to achieve such integration could result in the failure of the combined company to realize the anticipated benefits of the Arrangement and could impair the results of operations, profitability and financial results of the combined company following completion of the Arrangement.

The overall integration of the operations, technologies and personnel of Phivida into Choom may also result in unanticipated operational problems, expenses, liabilities and diversion of management’s time and attention.

The consideration to be provided under the Arrangement will not be adjusted to reflect any change in the market value of the Choom Shares.

Phivida Shareholders will receive a fixed number of Choom Shares under the Arrangement, rather than Choom Shares with a fixed market value. Because the number of Choom Shares to be received in respect of each Phivida Share under the Arrangement will not be adjusted to reflect any change in the market value of the Choom Shares, the market value of Choom Shares received under the Arrangement may vary significantly from the market value at the dates referenced in this Circular. If the market price of the Choom Shares increases or decreases, the value of the consideration that Phivida Shareholders receive pursuant to the Arrangement will correspondingly increase or decrease. There can be no assurance as to the market price of the Choom Shares at any time. Accordingly, the market price of the Choom Shares on the Effective Date could be lower than the market price of such shares on the date of the Meeting and/or the date of announcement of the Arrangement Agreement. In addition, the number of Choom Shares being issued in connection with the Arrangement will not change despite increases or decreases in the market price of Phivida Shares. Many of the factors that affect the market price of the Choom Shares and the Choom Shares are beyond the control of Choom and Phivida, respectively. These factors include without limitation, fluctuations in currency exchange rates, changes in the regulatory environment, prevailing conditions in the capital markets and interest rate fluctuations.

The Required Phivida Shareholder Approval may not be obtained.

To be effective, the Special Resolution must be approved by a resolution passed by not less than two-thirds of the votes cast by the Phivida Shareholders present in person or represented by proxy at the Meeting voting together as a single class. There can be no certainty, nor can Phivida provide any assurance, that the Required Approval will be obtained. See “ Information Concerning the Arrangement .

The market price for the Phivida Shares may decline.

If the Arrangement is not completed, the market price of the Phivida Shares may decline to the extent that the current market price of the Phivida Shares reflects a market assumption that the Arrangement

56 -

will be completed. If the Arrangement is not completed and the Phivida Board decides to seek another merger or arrangement, there can be no assurance that it will be able to find a party willing to pay an equivalent or more attractive price than the total consideration to be paid pursuant to the Arrangement.

The issuance of Choom Shares under the Arrangement and their subsequent sale may cause the market price of Choom Shares to decline.

As of the Record Date, 2020, there were 225,753,870 Choom Shares issued and outstanding and there were 89,033,717 Phivida Shares issued and outstanding. After giving effect to the transactions contemplated by the Arrangement, there will be approximately 290,362,077 Choom Shares issued and outstanding, of which approximately 22% will be held by former Phivida Shareholders assuming no additional shares are issued by any of the Parties other than pursuant to the Arrangement. The issuance of Choom Shares under the Arrangement and the resale of such Choom Shares may cause the market price of Choom Shares to decline.

Risks Related to Phivida

If the Arrangement is completed, Phivida will continue to face many of the risks that it currently faces with respect to its business and affairs. See “ Additional Information Concerning Phivida – Risk Factors ” in Appendix “G”.

Risks Related to Choom

If the Arrangement is completed, Choom will continue to face many of the risks that it currently faces with respect to its business and affairs. See “ Additional Information Concerning Choom Before and After the Arrangement – Risk Factors ” in Appendix “H” to this Circular.

Certain Canadian Federal Income Tax Considerations

The following is, as of the date hereof, a general summary of the principal Canadian federal income tax considerations under the Tax Act relating to (i) the exchange of Phivida Shares for Choom Shares pursuant to the Arrangement, and (ii) the ownership and disposition of such Choom Shares that are generally applicable to beneficial owners of Phivida Shares or holders who acquire Choom Shares as beneficial owners pursuant to the Arrangement, as applicable, and who, at all relevant times, for the purposes of the Tax Act, deal at arm’s length with, and are not affiliated with, Phivida, Choom, or any of their respective affiliates, and hold their Phivida Shares, and will acquire and hold any Choom Shares received pursuant to the Arrangement, as capital property (each, a “ Holder ”), all within the meaning of the Tax Act. Phivida Shares and Choom Shares will generally be considered to be capital property to a Holder unless the Holder holds or uses the Phivida Shares or Choom Shares, or is deemed to hold or use the Phivida Shares or Choom Shares, in the course of carrying on a business of trading or dealing in securities or has acquired them or is deemed to have acquired them in a transaction or transactions considered to be an adventure or concern in the nature of trade.

This summary does not apply to a Holder: (i) that is a “financial institution” for purposes of the mark-to-market rules contained in the Tax Act, (ii) an interest in which is or would constitute a “tax shelter investment” as defined in the Tax Act, (iii) that is a “specified financial institution” as defined in the Tax Act, (iv) that reports its “Canadian tax results” in a currency other than Canadian currency, as defined in the Tax Act, (v) who received Phivida Shares or will receive Choom Shares upon exercise of a stock option, (vi) who has entered into or will enter into, with respect to their Phivida Shares or Choom Shares, a

57 -

“synthetic disposition arrangement” or a “derivative forward agreement” as those terms are defined in the Tax Act, (vii) that is a corporation resident in Canada for purposes of the Tax Act whose investment in a non-resident corporation as part of a transaction or event or series of transactions or events that includes the acquisition of Choom Shares is subject to the foreign affiliate dumping rules in section 212.3 of the Tax Act, or (viii) that is exempt from tax under the Tax Act. All such Holders should consult their own tax advisors with respect to the Arrangement, including the exchange of Phivida Shares for Choom Shares and the ownership and disposition of Choom Shares.

This summary does not address the deductibility of interest by a Holder who has borrowed money or otherwise incurred debt in connection with the acquisition of Phivida Shares.

The tax treatment of holders of Phivida Options is not addressed in this summary. All holders of Phivida Options should consult their own tax advisors with respect to the Arrangement.

This summary is based on the facts set out in this Circular, the current provisions of the Tax Act in force as of the date hereof, specific proposals to amend the Tax Act (the “ Proposed Amendments ”) which have been announced by or on behalf of the Minister of Finance (Canada) prior to the date hereof, except for any proposals in connection with governmental actions to address the COVID-19 pandemic (the “ COVID-19 Measures ”), and counsel’s understanding of the published administrative policies and assessing practices of the Canada Revenue Agency (the “ CRA ”) publicly available prior to the date of this Circular other than in respect of the COVID-19 Measures.

Except for the Proposed Amendments, this summary does not take into account or anticipate any other changes in law or any changes in the CRA’s administrative policies and assessing practices, whether by way of judicial, governmental or legislative action or decision, nor does it take into account other federal or any provincial, territorial or foreign income tax legislation or considerations, including in connection with the COVID-19 Measures, which may differ significantly from the Canadian federal income tax considerations discussed herein. No assurances can be given that the Proposed Amendments will be enacted as proposed or at all, or that legislative, judicial, or administrative changes will not modify or change the statements expressed herein.

This summary is not exhaustive of all possible Canadian federal income tax considerations applicable to the Arrangement or the ownership and disposition of Choom Shares. This summary is of a general nature only and is not intended to be, and should not be construed to be, legal, business or income tax advice to any particular Holder. Holders should consult their own income tax advisors with respect to the tax consequences applicable to them having regard to their own particular circumstances.

Generally for purposes of the Tax Act, all amounts relating to the acquisition, holding or disposition of Phivida Shares or Choom Shares (including dividends, adjusted cost base and proceeds of disposition) must be expressed in Canadian dollars. Amounts denominated in U.S. dollars or another foreign currency must be converted into Canadian dollars using the daily exchange rate published by the Bank of Canada on the particular date the particular amount arose or such other rate of exchange as may be accepted by the CRA. Holders may therefore realize additional income or gain by virtue of changes in foreign exchange rates, and are advised to consult with their own tax advisors in this regard. Currency-related tax issues are not discussed further in this summary.

58 -

Holders Resident in Canada

This part of the summary is generally applicable only to a Holder who, at all relevant times, and for purposes of the Tax Act, is resident, or is deemed to be resident, in Canada (a “ Resident Holder ”). Certain Resident Holders whose Phivida Shares or Choom Shares might not otherwise constitute capital property may be eligible to make an irrevocable election in accordance with subsection 39(4) of the Tax Act to have their Phivida Shares, Choom Shares and every other “Canadian security” (as defined in the Tax Act) owned by such Resident Holder in the taxation year in which the election is made and in all subsequent taxation years, be deemed to be capital property. Resident Holders contemplating such an election should first consult their own tax advisors.

Exchange of Phivida Shares for Choom Shares Pursuant to the Arrangement

Pursuant to the Arrangement, a Resident Holder, other than a Resident Dissenting Holder (as defined below), will exchange their Phivida Shares for Choom Shares. Such Resident Holder will be deemed to have disposed of such Phivida Shares under a tax-deferred share-for-share exchange pursuant to section 85.1 of the Tax Act and will not recognize a capital gain (or capital loss), unless such Resident Holder chooses to recognize a capital gain (or capital loss) as described in the immediately following paragraph. More specifically, the Resident Holder will be deemed to have disposed of the Phivida Shares for proceeds of disposition equal to the adjusted cost base of the Phivida Shares to such holder, determined immediately before the Effective Time, and the Resident Holder will be deemed to have acquired the Choom Shares at an aggregate cost equal to such adjusted cost base of the Phivida Shares. This cost will be averaged with the adjusted cost base of all other Choom Shares held by the Resident Holder as capital property for the purpose of determining the adjusted cost base of each Choom Share held by the Resident Holder.

A Resident Holder who exchanges Phivida Shares for Choom Shares pursuant to the Arrangement and who chooses to recognize the amount of the capital gain (or capital loss) in respect of the exchange may do so by including the amount of such capital gain (or capital loss) in computing its income for the taxation year in which the exchange takes place. In such circumstances, the Resident Holder will realize a capital gain (or a capital loss) equal to the amount, if any, by which the fair market value of the Choom Shares received exceeds (or is less than) the aggregate of the adjusted cost base of the Phivida Shares to the Resident Holder, determined immediately before the Effective Time, and any reasonable costs of disposition. For a description of the tax treatment of capital gains and capital losses, see “Taxation of Capital Gains and Capital Losses” below. The cost of the Choom Shares acquired on the exchange will be equal to the fair market value thereof in these circumstances. This cost will be averaged with the adjusted cost base of all other Choom Shares held by the Resident Holder as capital property for the purpose of determining the adjusted cost base of such Choom Shares.

Dissenting Holders

A Phivida Shareholder that is a Resident Holder who, as a result of exercising Dissent Rights in respect of the Arrangement (a “ Resident Dissenting Holder ”), receives a cash payment from Phivida in consideration for the Resident Dissenting Holder’s Phivida Shares will be deemed to receive a taxable dividend equal to the amount by which the amount received (excluding interest awarded by a court) from Phivida exceeds the paid-up capital of the Resident Dissenting Holder’s Phivida Shares. In the case of a Resident Dissenting Holder that is a corporation, in some circumstances, the amount of such deemed dividend may be treated as proceeds of disposition and not a dividend. See “ Taxation of

59 -

Dividends ” below for a general description of the treatment of dividends under the Tax Act. The Resident Dissenting Holder will also be deemed to have received proceeds of disposition for the Phivida Shares equal to the amount (excluding interest awarded by a court) received by the Resident Dissenting Holder less the amount of the deemed dividend referred to above. Consequently, the Resident Dissenting Holder will realize a capital gain (or capital loss) to the extent that such proceeds of disposition exceed (or are exceeded by) the adjusted cost base of such Resident Dissenting Holder’s Phivida Shares. See “ Taxation of Capital Gains and Capital Losses ” below for a general description of the treatment of capital gains and losses under the Tax Act.

Interest awarded by a court and paid or payable, if any, to a Resident Dissenting Holder will be included in the Resident Dissenting Holder’s income.

Taxation of Dividends

Dividends received or deemed to be received on Choom Shares held by a Resident Holder, or in respect of Phivida Shares of a Resident Dissenting Holder, will be included in the Resident Holder’s income for the purposes of the Tax Act. Such dividends received by a Resident Holder who is an individual (including certain trusts) will be subject to the gross-up and dividend tax credit rules in the Tax Act normally applicable to taxable dividends received from taxable Canadian corporations.

Provided that appropriate designations are made by Choom at or prior to the time a dividend is paid on Choom Shares, such dividend will be treated as an “eligible dividend” for the purposes of the Tax Act and a Resident Holder who is an individual (including certain trusts) will be entitled to an enhanced dividend tax credit in respect of such dividend. There may be limitations on the ability of Choom to designate dividends as “eligible dividends”. Dividends received by an individual (including certain trusts) may give rise to a liability for minimum tax.

In the case of a Resident Holder of Choom Shares that is a corporation, dividends received on Choom Shares will be required to be included in computing the corporation’s income for the taxation year in which such dividends are received and will generally be deductible in computing the corporation’s taxable income. In certain circumstances, subsection 55(2) of the Tax Act will treat a taxable dividend received by a Resident Holder that is a corporation as proceeds of disposition or a capital gain. Accordingly, Resident Holders that are corporations should consult their own tax advisors for specific advice with respect to the potential application of this provision.

A Resident Holder of Choom Shares that is a “private corporation” or “subject corporation” (as such terms are defined in the Tax Act), or any other corporation resident in Canada and controlled, whether because of a beneficial interest in one or more trusts or otherwise, by or for the benefit of an individual (other than a trust) or a related group of individuals (other than trusts), may be liable under Part IV of the Tax Act to pay a refundable tax on dividends received on Choom Shares to the extent that such dividends are deductible in computing the Resident Holder’s taxable income for the year.

Disposition of Choom Shares

A disposition or deemed disposition of a Choom Share by a Resident Holder (other than a disposition to Choom except where such disposition is the result of a purchase in the open market in the manner in which shares are normally purchased by a member of the public in the open market) will generally result

60 -

in a capital gain (or a capital loss) to the extent that the proceeds of disposition, net of any reasonable costs of disposition, exceed (or are less than) the adjusted cost base to the Resident Holder of the Choom Share immediately before the disposition. For a description of the tax treatment of capital gains and capital losses, see “Taxation of Capital Gains and Capital Losses” below.

Taxation of Capital Gains and Capital Losses

Generally, one-half of the amount of any capital gain (a “ taxable capital gain ”) realized by a Resident Holder in a taxation year will be required to be included in computing the Resident Holder’s income for that year. A Resident Holder will be required to deduct one-half of the amount of any capital loss (an “ allowable capital loss ”) realized in a taxation year from taxable capital gains realized by the Resident Holder in that year. Allowable capital losses in excess of taxable capital gains realized in a taxation year may be carried back to any of the three preceding taxation years or carried forward to any subsequent taxation year and deducted against net taxable capital gains realized in such years, subject to and in accordance with the detailed rules contained in the Tax Act.

The amount of any capital loss realized on the disposition of a Phivida Share or Choom Share by a Resident Holder that is a corporation may, to the extent and under the circumstances specified by the Tax Act, be reduced by the amount of any dividends received or deemed to have been received by the corporation on such share (or on a share for which such share is substituted or exchanged). Similar rules may apply where a corporation is, directly or through a trust or partnership, a beneficiary of a trust or a member of a partnership that owns such shares. Resident Holders to whom these rules may be relevant should consult their own tax advisors.

A Resident Holder that is throughout the year a “Canadian-controlled private corporation”, as defined in the Tax Act, may be liable to pay an additional refundable tax on certain investment income for the year, including taxable capital gains realized.

Capital gains realized by a Resident Holder who is an individual or a trust, other than certain specified trusts, will be taken into account in determining liability for minimum tax under the Tax Act.

Eligibility for Investment

The Choom Shares, provided they are listed on a designated stock exchange as defined in the Tax Act (which currently includes the CSE) at the Effective Time (and at all relevant times), will be qualified investments under the Tax Act for a trust governed by a registered retirement savings plan (“ RRSP ”), a registered retirement income fund (“ RRIF ”), a registered disability savings plan (“ RDSP ”), a registered education savings plan (“ RESP ”), a tax free savings account (“ TFSA” ) or a deferred profit sharing plan, as those terms are defined in the Tax Act.

Notwithstanding that Choom Shares may be qualified investments for a TFSA, RRSP, RRIF, RDSP or RESP (a “ Registered Plan ”), the holder, the subscriber or annuitant of the Registered Plan , as the case may be, will be subject to a penalty tax in respect of Choom Shares held in a Registered Plan if such Choom Shares are a “prohibited investment” for the purposes of the Tax Act. Choom Shares will generally not be a “prohibited investment” for a Registered Plan unless the holder, subscriber or annuitant of the Plan, as the case may be, (i) does not deal at arm’s length with Choom for purposes of the Tax Act, or (ii) has a “significant interest” (as defined in the Tax Act) in Choom. In addition, Choom Shares

61 -

will not be a prohibited investment for a Registered Plan if such shares are “excluded property” (as defined in the Tax Act) for such Registered Plan.

Resident Holders who intend to hold Choom Shares in their Registered Plans should consult their own tax advisors in regard to the application of these rules in their particular circumstances.

Holders Not Resident in Canada

This part of the summary is generally applicable only to a Holder who, at all relevant times, for purposes of the Tax Act is neither resident nor deemed to be resident in Canada, and does not use or hold, and is not deemed to use or hold, Phivida Shares or Choom Shares in connection with carrying on a business in Canada (a “ Non-Resident Holder ”). This part of the summary is not applicable to Non-Resident Holders that are insurers carrying on an insurance business in Canada and elsewhere or an “authorized foreign bank” (as defined in the Tax Act).

Exchange of Phivida Shares for Choom Shares Pursuant to the Arrangement

Pursuant to the Arrangement, a Non-Resident Holder, other than Dissenting Non-Resident Holders (as defined below), will exchange their Phivida Shares for Choom Shares. Such exchange will occur on a tax-deferred basis such that no capital gain or capital loss will be realized, unless the Non-Resident Holder chooses to recognize a capital gain or capital loss as described below.

A Non-Resident Holder (including a Dissenting Non-Resident Holder) will not be subject to tax under the Tax Act on any capital gain realized on a disposition or deemed disposition of Phivida Shares unless the Phivida Shares constitute “taxable Canadian property” and the Non-Resident Holder is not entitled to relief under an applicable income tax treaty or convention.

Generally, a Phivida Share, will not constitute taxable Canadian property of a Non-Resident Holder at the time of disposition provided that such share is listed on a designated stock exchange (which includes the CSE) at that time, unless at any time during the 60-month period immediately preceding the disposition: (i) one or any combination of (a) the Non-Resident Holder, (b) persons with whom the Non-Resident Holder does not deal at arm’s length, and (c) partnerships in which the Non-Resident Holder or a person described in (b) holds a membership interest directly or indirectly through one or more partnerships, owned 25% or more of the issued shares of any class or series of the capital stock of Phivida, and (ii) more than 50% of the fair market value of such share was derived directly or indirectly from one or any combination of real or immovable property situated in Canada, “Canadian resource property” (as defined in the Tax Act), “timber resource property” (as defined in the Tax Act), and options in respect of, or interests in, or civil law rights in, any such properties (whether or not such property exists). In certain circumstances set out in the Tax Act, Phivida Shares may be deemed to be “taxable Canadian property”.

In the event the Phivida Shares are, or are deemed to be, “taxable Canadian property” to the Non-Resident Holder but not “treaty-protected property” to the Non-Resident Holder at the time of disposition, the consequences to such Non-Resident Holder will generally be the same as described above under the heading “ Holders Resident in Canada – Exchange of Phivida Shares for Choom Shares including the potential for the deferral of any capital gain or loss that would otherwise be realized on the disposition of the Phivida Shares in exchange for the Choom Shares under the provisions of subsection 85.1(1) of the Tax Act.

62 -

Non-Resident Holders whose Phivida Shares may constitute taxable Canadian property should consult their own tax advisors for advice having regard to their particular circumstances.

Non-Resident Dissenting Holders

A Non-Resident Holder who validly exercises Dissent Rights in respect of the Arrangement (a “ Dissenting Non-Resident Holder ”) will be deemed to have transferred such Dissenting Non-Resident Holder’s Phivida Shares to Phivida, and will be entitled to receive a payment from Phivida of an amount equal to the fair value of such Dissenting Non-Resident Holder’s Phivida Shares. A Dissenting NonResident Holder will be deemed to receive a taxable dividend equal to the amount, if any, by which such payment (other than any portion of the payment that is interest, if any, awarded by the Court) exceeds the “paid-up capital” (computed for the purpose of the Tax Act) of the Dissenting Non-Resident Holder’s Phivida Shares immediately before their transfer to Phivida pursuant to the Arrangement. Any such dividend will be subject to Canadian non-resident withholding tax under the Tax Act at a rate of 25% of the gross amount of the dividend, unless the rate is reduced by an applicable income tax treaty or convention.

A Dissenting Non-Resident Holder of Phivida Shares will also be considered to have disposed of such Phivida Shares for proceeds of disposition equal to the amount paid to such Dissenting Non-Resident Holder less an amount in respect of interest, if any, awarded by the Court and the amount of any deemed dividend. A Dissenting Non-Resident Holder will generally not be subject to income tax under the Tax Act in respect of any capital gain realized on a disposition of Phivida Shares pursuant to the exercise of their Dissent Rights unless such Phivida Shares constitute, or are deemed to constitute, “taxable Canadian property” of the Dissenting Non-Resident Holder and the Dissenting Non-Resident Holder is not entitled to relief under an applicable income tax treaty or convention. See the discussion above under the heading “ Holders Not Resident in Canada – Exchange of Phivida Shares for Choom Shares ”.

Any interest paid or credited to a Dissenting Non-Resident Holder will generally not be subject to Canadian withholding tax under the Tax Act provided such interest is not “participating debt interest” (as defined in the Tax Act).

Dissenting Non-Resident Holders who are contemplating exercising their Dissent Rights should consult their own tax advisors with respect to the Canadian federal income tax consequences of exercising their Dissent Rights.

Taxation of Dividends

Any dividends paid or credited, or deemed to be paid or credited, in respect of Choom Shares to a Non-Resident Holder, or in respect of Phivida Shares of a Non-Resident Dissenting Holder, will be subject to Canadian withholding tax at a rate of 25%, subject to any reduction pursuant to an applicable income tax treaty or convention. For example, under the Canada-United States Tax Convention (1980), as amended (the “ U.S. Treaty ”), where the beneficial owner of dividends is a NonResident Holder who is a U.S. resident for the purpose of, and who is entitled to the benefits in accordance with the provisions of, the U.S. Treaty, the applicable rate of Canadian withholding tax generally is reduced to 15%.

63 -

Disposition of Choom Shares

A Non-Resident Holder will not be subject to tax under the Tax Act on any capital gain realized on a disposition or deemed disposition of a Choom Share acquired pursuant to the Arrangement, unless the Choom Share is: (i) “taxable Canadian property” to the Non-Resident Holder at the time of disposition for purposes of the Tax Act; and (ii) not “treaty protected property” (as defined in the Tax Act) of the Non-Resident Holder at the time of disposition. Provided that at the time of disposition the Choom Shares are listed on a designated stock exchange for purposes of the Tax Act (which currently includes the CSE), the Choom Shares will not be “taxable Canadian property” at that time, unless at any time during the 60month period immediately preceding the disposition: (i) one or any combination of (a) the Non-Resident Holder, (b) persons with whom the Non-Resident Holder does not deal at arm’s length, and (c) partnerships in which the Non-Resident Holder or a person described in (b) holds a membership interest directly or indirectly through one or more partnerships, owned 25% or more of the issued shares of any class or series of the capital stock of Choom, and (ii) more than 50% of the fair market value of such share was derived directly or indirectly from one or any combination of real or immovable property situated in Canada, “Canadian resource property” (as defined in the Tax Act), “timber resource property” (as defined in the Tax Act), and options in respect of, or interests in, or civil law rights in, any such properties (whether or not such property exists).

Where a Non-Resident Holder acquires Choom Shares pursuant to the Arrangement in exchange for Phivida Shares that are, at the time of the exchange, “taxable Canadian property” to the Non-Resident Holder, the Choom Shares will generally be deemed to be “taxable Canadian property” to the NonResident Holder for the 60 month period following the exchange. Non-Resident Holders who dispose of Choom Shares that may constitute “taxable Canadian property” should consult their own tax advisors with respect to the Canadian income tax consequences of the disposition and the potential requirement to file a Canadian income tax return in respect of the disposition depending on their particular circumstances.

Securities Laws and Considerations

The following is a brief summary of the Securities Laws considerations applicable to the Arrangement.

Status under Canadian Securities Laws

Choom is (and after the Arrangement will continue to be) a “reporting issuer” in the Provinces of British Columbia, Alberta, Saskatchewan and Ontario and the Choom Shares are listed on the CSE (symbol:CHOO). Phivida is a “reporting issuer” in the Provinces of British Columbia, Alberta, Ontario and New Brunswick and the Phivida Shares are listed on the CSE (symbol:VIDA). Following the completion of the Arrangement, Choom will take steps for Phivida to delist from the CSE and cease being a reporting issuer in British Columbia, Alberta, Ontario and New Brunswick.

Issuance and Resale of Choom Shares under Canadian Securities Laws

The issue of the Choom Shares to the Phivida Shareholders under the Plan of Arrangement constitutes a distribution of securities which is exempt from the registration and prospectus requirements of applicable Canadian Securities Laws. The Choom Shares issued to former Phivida Shareholders may be resold in each of the provinces and territories of Canada, provided Choom is and has been a reporting issuer for the four months immediately preceding the trade, the holder is not a “control person” as defined in the applicable

64 -

Canadian Securities Laws, no unusual effort is made to prepare the market or create a demand for those securities, no extraordinary commission or consideration is paid in respect of that sale and, if the holder is an insider or officer of Choom , the holder has no reasonable grounds to believe that Choom is in default of applicable Canadian Securities Laws.

Each Phivida Shareholder is urged to consult such Phivida Shareholder’s professional advisers to determine the conditions and restrictions applicable to trades in the Choom Shares to which the Phivida Shareholders are entitled under the Arrangement. Resales of any such securities acquired in connection with the Arrangement may be required to be made through properly registered securities dealers.

U.S. Securities Laws

The following discussion is a general overview of certain requirements of U.S. federal Securities Laws that may be applicable to Phivida Shareholders reselling their Choom Shares in the United States. All Phivida Shareholders are urged to consult with their own legal counsel to ensure that any subsequent U.S. resale of Choom Shares issued or distributed to them under the Arrangement complies with applicable Securities Laws.

The following discussion does not address applicable Canadian Securities Laws that will apply to the issue of Choom Shares or the resale within Canada of these securities by Phivida Shareholders. Phivida Shareholders reselling their Choom Shares in Canada must comply with applicable Canadian Securities Laws, as outlined elsewhere in this Circular.

Exemption from the Registration Requirements of the U.S. Securities Act

The Choom Shares to be received by Phivida Shareholders pursuant to the Arrangement have not been and will not be registered under the U.S. Securities Act or the Securities Laws of any state of the United States and will be issued and distributed, respectively, in reliance upon the exemption from registration provided by Section 3(a)(10) of the U.S. Securities Act and exemptions provided under the Securities Laws of each state of the United States in which Phivida Shareholders reside. Section 3(a)(10) of the U.S. Securities Act exempts from the general registration requirements under the U.S. Securities Act, securities issued in exchange for one or more bona fide outstanding securities, or partly in such exchange and partly for cash, where the terms and conditions of the issuance and exchange are approved by a court of competent jurisdiction that is expressly authorized by Law to grant such approval, after a hearing upon the fairness of such terms and conditions of such issuance and exchange at which all persons to whom the securities will be issued in such exchange have the right to appear and receive timely notice thereof.

On August 5, 2020, Phivida obtained the Interim Order, a copy of which is attached as Appendix “C” to this Circular. Subject to the terms of the Arrangement Agreement and, if the Special Resolution is approved at the Meeting, Phivida will apply to the Court for the Final Order at the Court House, 800 Smithe Street, Vancouver, British Columbia on September 9, 2020, at 9:45 a.m. (Vancouver time) or as soon thereafter as counsel may be heard. Please see the Notice of Hearing of Petition, attached as Appendix “D” to this Circular, with respect to the hearing of the application for the Final Order for further information on participating or presenting evidence at the hearing for the Final Order. All Phivida Shareholders are entitled to appear and be heard at this hearing. If the Special Resolution is approved by the requisite majority, then final approval of the Court must be obtained before the Arrangement may proceed. The Court has been advised that the Final Order, if granted, will constitute the basis for an exemption from the registration requirements of the U.S. Securities Act, pursuant to Section 3(a)(10) thereof, with respect to the issuance of the Choom Shares pursuant to the Arrangement.

65 -

Resales of Choom Shares within the United States after the Completion of the Arrangement

The Choom Shares receivable by Phivida Shareholders pursuant to the Arrangement will be freely tradable under the U.S. Securities Act, except by persons who are “affiliates” of Choom after the Arrangement or were affiliates of Choom within 90 days prior to completion of the Arrangement. Persons who may be deemed to be “affiliates” of an issuer include individuals or entities that control, are controlled by, or are under common control with, the issuer, whether through ownership of voting securities, by contract or otherwise, and generally include executive officers and directors of the issuer as well as principal shareholders of the issuer. Typically, persons who are executive officers, directors or 10% or greater shareholders of an issuer are considered to be its “affiliates”.

Any resale of such Choom Shares by such an affiliate (or, if applicable, former affiliate) may be subject to the registration requirements of the U.S. Securities Act, absent an exemption therefrom. In general, persons who are “affiliates” of Choom after the Arrangement or were affiliates of Choom within 90 days prior to completion of the Arrangement will be entitled to sell pursuant to Rule 144 under the U.S. Securities Act, during any three-month period, those Choom Shares that they receive pursuant to the Arrangement, provided that the number of such securities sold does not exceed the greater of one percent of the then outstanding securities of such class or the average weekly trading volume of Choom Shares on a United States securities exchange during the four calendar week period preceding the date of sale, subject to specified restrictions on manner of sale requirements, aggregation rules, notice filing requirements and the availability of current public information about the issuer. Subject to certain limitations, such affiliates (and former affiliates) may immediately resell such Choom Shares outside the United States without registration under the U.S. Securities Act pursuant to and in accordance with Regulation S under the U.S. Securities Act. The foregoing discussion is only a general overview of certain requirements of the U.S. Securities Act applicable to the resale of the Choom Shares receivable by Phivida Shareholders upon completion of the Arrangement. All holders of such securities are urged to consult with counsel to ensure that the resale of their securities complies with applicable securities legislation.

Exercise of Phivida Options, and Re-Sale of Choom Shares Issuable Thereto

The Choom Shares issuable upon exercise of the Phivida Options may not be issued in reliance upon the exemption from registration provided by Section 3(a)(10) of the U.S. Securities Act and the Phivida Options may be exercised only pursuant to an available exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws. Prior to the issuance of Choom Shares pursuant to any such exercise after the Effective Time, Choom may require evidence (which may include in an opinion of counsel) reasonably satisfactory to Choom to the effect that the issuance of such Choom Shares does not require registration under the U.S. Securities Act or applicable state securities laws.

Choom Shares received upon exercise of Phivida Options after the Effective Time by holders in the United States or who are U.S. Persons will be “restricted securities”, as such term is defined in Rule 144(a)(3) under the U.S. Securities Act, and may not be resold unless such securities are registered under the U.S. Securities Act and all applicable state securities laws or unless an exemption from such registration requirements is available. Subject to certain limitations, any Choom Shares issuable upon the exercise of Phivida Options may be resold outside the United States without registration under the U.S. Securities Act pursuant to Regulation S in an “offshore transaction” (as such term is defined in Regulation S) over the CSE.

66 -

MI 61-101

As Phivida is a reporting issuer in Ontario, it is subject to MI 61-101. MI 61-101 is intended to regulate certain transactions to ensure equality of treatment among securityholders, generally requiring enhanced disclosure, approval by a majority of securityholders (excluding interested or related parties), independent valuations and, in certain circumstances, approval and oversight of the transaction by a special committee of independent directors.

MI 61-101 provides that, in certain circumstances, where a “related party” of an issuer such as Phivida is a party to a “connected transaction” or is entitled to receive a “collateral benefit” (as such terms are defined in MI 61-101) in connection with an acquisition transaction (such as the Arrangement), such transaction may be considered a “business combination” under MI 61-101 and subject to minority approval requirements and potentially a formal valuation requirement.

A “connected transaction” (as defined in MI 61-101) means two or more transactions that have at least one party in common, directly or indirectly, other than transactions related solely to services as an employee, director or consultant, and (a) are negotiated or completed at approximately the same time; or (b) the completion of at least one of the transactions is conditional on the completion of each of the other transactions.

A “collateral benefit” (as defined in MI 61-101) includes any benefit that a “related party” of Phivida (which includes the directors and senior officers of Phivida, as well as any securityholder holding more than 10% of the voting securities of Phivida) is entitled to receive, directly or indirectly, as a consequence of the Arrangement, including, without limitation, an increase in salary, a lump sum payment, a payment for surrendering securities, or other enhancement in benefits related to past or future services as an employee, director or consultant of Phivida or of another person, regardless of the existence of any offsetting costs to the related party or whether the benefit is provided, or agreed to, by Phivida or Choom.

However, MI 61-101 expressly excludes from the meaning of “collateral benefit” the following: (a) a payment or distribution per Phivida Share that is identical in amount and form to the entitlement of the general body of holders in Canada of Phivida Shares; (b) an enhancement of employee benefits resulting from participation by the related party in a group plan, other than an incentive plan, for employees of a successor to the business of Phivida, if the benefits provided by the group plan are generally provided to employees of the successor to the business of Phivida who hold positions of a similar nature to the position held by the related party; or (c) a benefit, not described in (b), that is received solely in connection with the related party’s services as an employee, director or consultant of Phivida, of an affiliated entity of Phivida or of a successor to the business of Phivida, if: (i) the benefit is not conferred for the purpose, in whole or in part, of increasing the value of the consideration paid to the related party for securities relinquished under the Arrangement; (ii) the conferring of the benefit is not, by its terms, conditional on the related party supporting the Arrangement in any manner; (iii) full particulars of the benefit are disclosed in this Circular for the Arrangement; and (iv) (A) at the time the Arrangement was agreed to, the related party and its associated entities beneficially own, or exercise control or direction over, less than 1% of the outstanding Phivida Shares; or (B) for business combinations: (I)the related party discloses to an independent committee of Phivida the amount of consideration that the related party expects it will be beneficially entitled to receive, under the terms of the transaction, in exchange for the Phivida Shares beneficially owned by the related party; (II) the independent committee, acting in good faith, determines that the value of the benefit, net of any offsetting costs to the related party, is less than 5% of the value

67 -

referred to in clause (I); and (III) the independent committee’s determination is disclosed in the disclosure document for the transaction.

To the knowledge of Phivida, no related party of Phivida is party to any “connected transactions” (as that term is defined under MI 61-101) in respect of the transactions contemplated by the Arrangement Agreement involving Choom or any of its affiliated entities or any entities acting jointly or in concert with it, nor is any related party of Phivida receiving a “collateral benefit” in connection with the Arrangement for the purposes of MI 61-101. As the Arrangement is not a “business combination” under MI 61-101, the requirements under MI 61-101 do not apply to the Arrangement.

See “ Information Concerning the Arrangement – Interests of Certain Persons in the Arrangement ”.

RIGHTS OF DISSENTING SHAREHOLDERS

There is no mandatory statutory right of dissent and appraisal in respect of plans of arrangement under the BCBCA. However, as contemplated in the Plan of Arrangement and the Interim Order, a copy of which is attached as Appendix “B” and Appendix “C”, respectively, to this Circular, Phivida and Choom have granted to Phivida Shareholders who object to the Arrangement the Dissent Rights. The Dissent Rights adopt the dissent procedures set forth in Division 2 of Part 8 of the BCBCA, as may be modified by the Plan of Arrangement, the Interim Order and the Final Order. A copy of Division 2 of Part 8 of the BCBCA is attached as Appendix “E” to this Circular.

The following is a summary of the Dissent Rights. Such summary is not a comprehensive statement of the procedures to be followed by a Phivida Shareholder who seeks to exercise such Dissent Rights and is qualified in its entirety by reference to the full text of the Plan of Arrangement, the Interim Order, and Division 2 of Part 8 of the BCBCA, which are attached as Appendix “B”, Appendix “C” and Appendix “E”, respectively, to this Circular.

The Dissent Rights are technical and complex. Any Phivida Shareholders who wish to exercise their Dissent Rights should seek independent legal advice, as failure to comply strictly with the Dissent Rights may result in the loss or unavailability of their right of dissent.

Registered Phivida Shareholders may exercise rights of dissent (“ Dissent Rights ”) in connection with the Arrangement pursuant to the Interim Order and in the manner set forth in Sections 237 to 247 of the BCBCA (collectively, the “ Dissent Procedures ”), provided that the written notice setting forth the objection of such Registered Phivida Shareholder to the Arrangement contemplated by Section 242 of the BCBCA must be received by Phivida not later than 4:30 p.m. (Vancouver time) on the Business Day that is two (2) Business Days before the Meeting.

Phivida Shareholders who duly and validly exercise Dissent Rights with respect to their Phivida Shares (“ Dissenting Shares ”) and who:

(a) are ultimately entitled to be paid fair value for their Dissenting Shares, will be deemed to have transferred their Dissenting Shares to Phivida and shall be paid an amount equal to such fair value by Phivida out of its separate assets; or
(b) for any reason are ultimately not entitled to be paid fair value for their Dissenting Shares, will be deemed to have participated in the Arrangement on the same basis as a non-dissenting Phivida
68 -

Shareholder and will receive Choom Shares on the same basis as every other non-dissenting Phivida Shareholder,

but in no case will Phivida or Choom be required to recognize such persons as holding Phivida Shares on or after the Effective Date. For greater certainty, in no case shall Phivida, Choom or any other Person be required to recognize Dissenting Shareholders as Phivida Shareholders after the Effective Time, and the names of such Dissenting Shareholders shall be deleted from the central register of holders of Phivida Shares as of the Effective Time.

In addition to any other restrictions set forth in the BCBCA, none of the following shall be entitled to exercise Dissent Rights: (i) Phivida Shareholders who vote, or who have instructed a proxyholder to vote, in favour of the Special Resolution; and (ii) holders of Phivida Options.

Non-Registered Holders of Phivida Shares who wish to dissent with respect to their Phivida Shares should be aware that only Registered Phivida Shareholders may exercise Dissent Rights in respect of Phivida Shares registered in such holder’s name. In many cases, Phivida Shares beneficially owned by a non-registered Phivida Shareholder are registered either (i) in the name of an Intermediary; or (ii) in the name of a clearing agency (such as CDS & Co.) of which the Intermediary is a participant. Accordingly, Non-Registered Holders of Phivida Shares will not be entitled to exercise their Dissent Rights directly, unless the Phivida Shares are re-registered in the Non-Registered Holder’s name and the procedures to exercise Dissent Rights are strictly complied with. A Non-Registered Holder of Phivida Shares who wishes to exercise Dissent Rights should immediately contact the Intermediary with whom such Non-Registered Holder deals in respect of its Phivida Shares and either: (i) instruct such Intermediary to exercise the Dissent Rights on such Non-Registered Holder’s behalf (which, if the Phivida Shares are registered in the name of CDS & Co. or other clearing agency, may require that the Phivida Shares first be re-registered in the name of such Intermediary), or (ii) instruct such Intermediary to re-register such Phivida Shares in the name of such Non-Registered Holder, in which case such Non-Registered Holder would be able to exercise the Dissent Rights directly without the involvement of such Intermediary.

A dissenting Shareholder (“ Dissenting Shareholder ”) must dissent with respect to all Phivida Shares in which the holder owns a beneficial interest. A Registered Phivida Shareholder who wishes to dissent must deliver written notice of dissent (a “ Notice of Dissent ”) which must be received by Phivida at its address for such purpose by (i) mail or hand delivery to Suite 2300, 550 Burrard Street, Vancouver, BC, V6C 2B5, Attention: Martin L. Palleson and Jonathan B. Ross; or (ii) facsimile transmission to 604-683-3558 and such Notice of Dissent must strictly comply with the requirements of the Dissent Rights. Pursuant to the Plan of Arrangement and the Interim Order, the Notice of Dissent must be received by Phivida not later than 4:30 p.m. (Vancouver time) on the Business Day that is two (2) Business Days before the Meeting or on the Business Day that is two (2) Business days preceding any date to which the Meeting may be postponed or adjourned. Any failure by a Dissenting Shareholder to strictly comply with the Dissent Rights may result in the loss of that holder’s Dissent Rights. A Non-Registered Holder who wishes to exercise Dissent Rights must arrange for the Registered Phivida Shareholder holding their Phivida Shares to deliver the Notice of Dissent in strict compliance with the Dissent Rights or for beneficially owned Phivida Shares to be registered in his, her or its name.

The delivery of a Notice of Dissent does not deprive a Dissenting Shareholder of the right to vote at the Meeting on the Special Resolution; however, the Plan of Arrangement and Interim Order provide that a Dissenting Shareholder who has delivered a Notice of Dissent and who votes in favour of the Special Resolution will no longer be considered a Dissenting Shareholder. A Phivida Shareholder need not vote its

69 -

Phivida Shares against the Special Resolution in order to dissent. A vote against the Special Resolution, whether in person or by proxy, does not constitute a Notice of Dissent.

A Dissenting Shareholder must prepare a separate Notice of Dissent for himself, herself or itself, if dissenting on his, her or its own behalf, and for each other person who beneficially owns Phivida Shares registered in the Dissenting Shareholder’s name and on whose behalf the Dissenting Shareholder is dissenting; and must dissent with respect to all of the Phivida Shares registered in his, her or its name beneficially owned by the Non-Registered Holders on whose behalf he, she or it is dissenting.

The Notice of Dissent must set out the name and address of the Dissenting Shareholder, the number of Phivida Shares in respect of which the Notice of Dissent is being given (the “ Notice Shares ”) and whichever of the following is applicable: (a) if the Notice Shares constitute all of the Phivida Shares of which the Dissenting Shareholder is both the registered and beneficial owner and the Dissenting Shareholder holds no other Phivida Shares as beneficial owner, a statement to that effect; (b) if the Notice Shares constitute all of the Phivida Shares of which the Dissenting Shareholder is both the registered and beneficial owner but the Dissenting Shareholder owns additional Phivida Shares beneficially, a statement to that effect and the names of the Registered Phivida Shareholders of such additional Phivida Shares, the number of such additional Phivida Shares held by each of those registered owners and a statement that Notices of Dissent are being, or have been, sent with respect to all such additional Phivida Shares; or (c) if the Dissent Rights are being exercised by a Registered Phivida Shareholder on behalf of a Non-Registered Holder who is not the Dissenting Shareholder, a statement to that effect and the name and address of the Non-Registered Holder and a statement that the Registered Phivida Shareholder is dissenting with respect to all Phivida Shares of the Non-Registered Holder that are registered in such Registered Phivida Shareholder’s name.

Phivida is required, promptly after the later of: (i) the date on which it forms the intention to proceed with the Arrangement and (ii) the date on which the Notice of Dissent was received, to notify each Dissenting Shareholder of its intention to act on the Special Resolution. If the Special Resolution is approved and if Phivida notifies the Dissenting Shareholders of its intention to act upon the Special Resolution, the Dissenting Shareholder is then required, within one month after Phivida gives such notice, to send to Phivida the certificates representing the Notice Shares if such shares are certificated, and a written statement that requires Choom to purchase all of the Notice Shares. If the Dissent Right is being exercised by the Dissenting Shareholder on behalf of a Non-Registered Holder who is not the Dissenting Shareholder, a statement signed by the Non-Registered Holder is required which sets out whether the Non-Registered Holder is the beneficial owner of other Phivida Shares and, if so, (i) the names of the registered owners of such Phivida Shares; (ii) the number of such Phivida Shares; and (iii) that dissent is being exercised in respect of all of such Phivida Shares. Upon delivery of these documents, the Dissenting Shareholder is deemed to have sold the Phivida Shares and Phivida is deemed to have purchased them. Once the Dissenting Shareholder has done this, the Dissenting Shareholder may not vote or exercise any shareholder rights in respect of the Notice Shares.

The Dissenting Shareholder and Phivida may agree on the payout value of the Notice Shares; otherwise, either party may apply to the Court to determine the payout value of the Notice Shares or apply for an order that value be established by arbitration or by reference to the registrar or a referee of the Court. After a determination of the payout value of the Notice Shares, Phivida must then promptly pay that amount to the Dissenting Shareholder. Pursuant to the Plan of Arrangement, Phivida is required to pay the payout value of the Notice Shares out of its separate assets.

70 -

A Dissenting Shareholder loses his, her or its Dissent Rights if, before full payment is made for the Notice Shares, Phivida abandons the corporate action that has given right to the Dissent Right (namely the Arrangement), a court permanently enjoins the action, or the Dissenting Shareholder withdraws the Notice of Dissent with Phivida’s consent. When these events occur, Phivida must return the share certificates, if applicable, to the Dissenting Shareholder and the Dissenting Shareholder regains the ability to vote and exercise shareholder rights.

The discussion above is only a summary of the Dissent Rights, which are technical and complex. A Phivida Shareholder who intends to exercise Dissent Rights should carefully consider and comply with the provisions of Division 2 of Part 8 of the BCBCA, as may be modified by the Interim Order, the Plan of Arrangement and the Final Order. Persons who are Non-Registered Holders of Phivida Shares registered in the name of an Intermediary or in some other name, who wish to dissent should be aware that only the registered owner of such Phivida Shares is entitled to dissent.

It is suggested that any Phivida Shareholder wishing to avail himself or herself of the Dissent Rights seek his or her own legal advice as failure to comply strictly with the applicable provisions of the BCBCA, as modified by the Interim Order and the Plan of Arrangement, may prejudice the availability of such Dissent Rights. Dissenting Shareholders should note that the exercise of Dissent Rights can be a complex, time-consuming and expensive process.

Section 246 of the BCBCA outlines certain events when Dissent Rights will cease to apply where such events occur before payment is made to the Dissenting Shareholders of the fair value of the Phivida Shares surrendered (including if the Special Resolution is not approved or is otherwise not proceeded with). In such events, the Dissenting Shareholder will be entitled to the return of the applicable share certificate(s), if any, and rights as a Phivida Shareholder in respect of the applicable Phivida Shares will be regained.

Any Phivida Shareholder wishing to avail himself or herself of the Dissent Rights that, for any reason, does not properly fulfill the dissent procedures in accordance with the applicable requirements, acts inconsistently with such dissent, or who, for any other reason, is not entitled to be paid the fair value of their Phivida Shares shall be treated as if the Phivida Shareholder had participated in the Arrangement on the same basis as a non-dissenting Phivida Shareholder.

It is a condition to the completion of the Arrangement that holders of no more than 5% of the issued and outstanding Phivida Shares have exercised Dissent Rights in respect of the Arrangement.

ADDITIONAL INFORMATION CONCERNING PHIVIDA

Phivida is a CBD-centric holding group with assets in technology, publishing and consumer-packaged goods (CPG). Additional information relating to Phivida is contained in this Circular in Appendix “G” - Additional Information Concerning Phivida .

ADDITIONAL INFORMATION CONCERNING CHOOM

Upon completion of the Arrangement, each Phivida Shareholder entitled to Choom Shares under the Plan of Arrangement will become a shareholder of Choom and Phivida will be a wholly-owned subsidiary of Choom.

71 -

Additional information relating to Choom, including information relating to Choom following completion of the Arrangement, is contained in this Circular in Appendix “H” – Additional Information Concerning Choom Before and After the Arrangement .

INTERESTS OF INFORMED PERSONS AND OTHERS IN MATERIAL TRANSACTIONS

Except as disclosed under “ Information Concerning the Arrangement – Interests of Certain Persons in the Arrangement ”, or elsewhere in this Circular, no informed person (as defined in Securities Laws) of Phivida, any proposed director of Phivida, or any associate or affiliate of the foregoing, has had any material interest, direct or indirect, in any transaction, or proposed transaction, since the commencement of the most recently completed financial year of Phivida, that has materially affected or would materially affect any of Phivida or its Subsidiaries.

INTERESTS OF CERTAIN PERSONS AND COMPANIES IN MATTERS TO BE ACTED UPON

Except as disclosed herein, Phivida is not aware of any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, of any director or executive officer or anyone who has held office as such since the beginning of Phivida’s last financial year, any proposed nominee for election as a director of Phivida, or any associate or affiliate of the foregoing, in any matter to be acted on at the Meeting other than the election of directors or the appointment of auditors.

AUDITORS AND TRANSFER AGENT

The auditor of Phivida is Baker Tilley WM LLP located in Vancouver, British Columbia. Baker Tilley WM LLP was first appointed as auditor of Phivida on May 5, 2017 and is independent in accordance with the Institute of Chartered Accountants of British Columbia.

The registrar and transfer agent for the Phivida Shares is Computershare at its office in Vancouver, British Columbia.

INTEREST OF EXPERTS

The following persons and companies have prepared certain sections of this Circular and/or Appendices attached hereto as described below, or are named as having prepared or certified a report, statement or opinion in or incorporated by reference in this Circular.

Name of Expert	Nature of Relationship
Haywood Securities Inc. (1)	Responsible for the preparation of the Fairness Opinion
Baker Tilley WM LLP(2)	Auditors of Phivida
Smythe LLP(2)	Auditors of Choom

(1) To the knowledge of Phivida, as of the date hereof, Haywood Securities Inc. and its “designated professionals” (as that term is defined under applicable securities laws) owned, directly and indirectly, in the aggregate, less than 1% of the outstanding Phivida Shares.

(2) The expert so named is independent in accordance with the Institute of Chartered Accountants of British Columbia.

OTHER MATTERS

Management of Phivida is not aware of any matters to come before the Meeting other than as set forth in the Notice that accompanies this Circular. If any other matter properly comes before the Meeting, it is

72 -

the intention of the persons named in the enclosed Proxy to vote the Phivida Shares represented thereby in accordance with their best judgment on such matter.

ADDITIONAL INFORMATION

Additional information relating to Phivida is available under its profile on the SEDAR website at www.sedar.com. Financial and other information of Phivida is provided in its audited consolidated financial statements and management’s discussion and analysis for the financial year ended September 30, 2019, which can be found under Phivida’s profile on SEDAR at www.sedar.com and will be sent without charge to any securityholder upon request by contacting the office of the Interim Chief Executive Officer at 1 (844) 744-6646 x2.

APPROVAL OF BOARD

The contents and the sending of this Circular have been approved by the Phivida Board.

DATED at Toronto, Ontario, on August 5, 2020.

BY ORDER OF THE PHIVIDA BOARD OF DIRECTORS

(signed) “David Moon”

David Moon Interim Chief Executive Officer and Director Phivida Holdings Inc.

CONSENT OF HAYWOOD SECURITIES INC.

To: The Special Committee (the “ Special Committee ”) and the Board of Directors (the “ Board ”) of Phivida Holdings Inc.

We hereby consent (i) to the references within the management information circular of Phivida Holdings Inc. (“ Phivida ”) dated August 5, 2020 (the “ Circular ”) to our fairness opinion dated June 2, 2020 (the “ Phivida Fairness Opinion ”), which we prepared for the Special Committee and the Board of Phivida in connection with the Arrangement Agreement dated June 2, 2020 between Choom Holdings Inc. and Phivida, and (ii) to the inclusion of the full text of the Phivida Fairness Opinion as Appendix “F” to the Circular and (iii) to the filing of the Circular with the Phivida Fairness Opinion included therein with the applicable securities regulatory authorities. In providing our consent, we do not intend or permit that any persons other than the Special Committee and the Board of Phivida shall rely upon the Phivida Fairness Opinion which remains subject to the analyses, assumptions, limitations and qualifications contained therein.

(signed) “ Haywood Securities Inc. ”

HAYWOOD SECURITIES INC.

August 5, 2020

A-1

APPENDIX “A”

FORM OF SPECIAL RESOLUTION

BE IT RESOLVED THAT:

The arrangement (the “ Arrangement ”) under Section 288 of the Business Corporations Act (British Columbia) (the “ BCBCA ”) involving Phivida Holdings Inc. (“ Phivida ”), a company existing pursuant to the BCBCA, and certain of its security holders, pursuant to the arrangement agreement between Phivida and Choom Holdings Inc., a company existing pursuant to the BCBCA, dated June 2, 2020, as it may be modified, supplemented or amended from time to time in accordance with its terms (the “ Arrangement Agreement ”), as more particularly described and set forth in the management information circular of Phivida dated August 5, 2020 (the “ Circular ”), and all transactions contemplated thereby, are hereby authorized, approved and adopted.
The plan of arrangement of Phivida and certain of its security holders, and implementing the Arrangement, as it has been or may be modified, supplemented or amended in accordance with the Arrangement Agreement and its terms (the “ Plan of Arrangement ”), the full text of which is set out in Appendix “B” to the Circular, is hereby authorized, approved and adopted.
The: (i) Arrangement Agreement and all the transactions contemplated therein; (ii) actions of the directors of Phivida in approving the Arrangement and the Arrangement Agreement; and (iii) actions of the directors and officers of Phivida in executing and delivering the Arrangement Agreement and any modifications, supplements or amendments thereto, and causing the performance by Phivida of its obligations thereunder, are hereby ratified, confirmed and approved.
Notwithstanding that this resolution has been passed (and the Arrangement adopted) by the holders of common shares of Phivida (the “ Phivida Shareholders ”) or that the Arrangement has been approved by the Supreme Court of British Columbia, the directors of Phivida are hereby authorized and empowered, without further notice to or approval of Phivida Shareholders:
(a) to amend, modify or supplement the Arrangement Agreement or the Plan of Arrangement to the extent permitted by their terms; and
(b) subject to the terms of the Arrangement Agreement, not to proceed with the Arrangement and any related transactions.
Any director or officer of Phivida is hereby authorized and directed, for and on behalf of Phivida, to execute, whether under the corporate seal of Phivida or otherwise, and deliver any records, information or other documents required by the Registrar under the BCBCA in accordance with the Arrangement Agreement.
Any officer or director of Phivida is hereby authorized and directed, for and on behalf of Phivida, to execute or cause to be executed and to deliver or cause to be delivered, all such other documents and instruments and to perform or cause to be performed all such other acts and things as, in such person’s opinion, may be necessary or desirable to give full force and effect to the foregoing resolutions and the matters authorized thereby, such determination to be

A-2

conclusively evidenced by the execution and delivery of any such other document or instrument or the doing of any such other act or thing.

B-1

APPENDIX “B”

PLAN OF ARRANGEMENT UNDER DIVISION 5 OF PART 9 OF THE BUSINESS CORPORATIONS ACT (BRITISH COLUMBIA)

==> picture [45 x 9] intentionally omitted <==

DEFINITIONS AND INTERPRETATION

==> picture [14 x 9] intentionally omitted <==

Definitions

(1) In this Plan of Arrangement, any capitalized term used herein and not defined in this Section 1.1(1) will have the meaning ascribed thereto in the Arrangement Agreement. Unless the context otherwise requires, the following words and phrases used in this Plan of Arrangement will have the meanings hereinafter set out:

“ Affected Person ” has the meaning ascribed thereto in Section 7.1(1).

“ Arrangement ” means an arrangement under Part 9, Division 5 of the BCBCA, on the terms and subject to the conditions set out in this Plan of Arrangement, subject to any amendments or variations to this Plan of Arrangement made in accordance with the terms of the Arrangement Agreement and the provisions of this Plan of Arrangement or made at the direction of the Court in the Final Order with the prior written consent of Phivida and Choom, each acting reasonably.

“ Arrangement Agreement ” means the arrangement agreement dated as of June 2, 2020 between Choom and Phivida, together with the Schedules attached thereto and the Phivida Disclosure Letter and Choom Disclosure Letter, as the same may be amended, supplemented or otherwise modified from time to time in accordance with the terms thereof.

“ Arrangement Resolution ” means the special resolution of Phivida Shareholders approving this Plan of Arrangement.

“ BCBCA ” means the Business Corporations Act (British Columbia) and the regulations made thereunder, as now in effect and as they may be promulgated or amended from time to time.

“ Broker ” has the meaning ascribed thereto in Section 7.1(2)(a).

“ Business Day ” means any day of the year, other than a Saturday, Sunday or any day on which major banks are closed for business in Toronto, Ontario or Vancouver, British Columbia.

“ Choom ” means Choom Holdings Inc., a company existing under the laws of the Province of British Columbia.

“ Choom Share ” means a common share in the authorized share structure of Choom.

“ Closing Certificate ” means a certificate in the form attached hereto as Appendix A which, when signed by an authorized representative of each of the Parties, will constitute acknowledgement

B-2

by the Parties that this Plan of Arrangement has been implemented to their respective satisfaction.

“ Consideration ” means the consideration to be received by the Phivida Shareholders pursuant to this Plan of Arrangement as consideration for their Phivida Shares, consisting of 0.72566 of a Choom Share for each Phivida Share, subject to adjustment in the manner and in the circumstances contemplated in Section 2.10 of the Arrangement Agreement, on the basis set out in this Plan of Arrangement.

“ Court ” means the Supreme Court of British Columbia.

“ Depositary ” means such Person as Choom may appoint to act as depositary for Phivida Shares in relation to the Arrangement, with the approval of Phivida, acting reasonably.

“ Dissent Procedures ” has the meaning ascribed thereto in Section 4.1(1).

“ Dissent Rights ” means the rights of dissent exercisable by registered Phivida Shareholders in respect of the Arrangement described in Section 4.1(1) hereto.

“ Dissenter ” means a registered Phivida Shareholder who has duly exercised a Dissent Right and who is ultimately entitled to be paid the fair value of the Phivida Shares held by such registered Phivida Shareholder.

“ Dissenting Shares ” has the meaning ascribed thereto in Section 4.1(2).

“ Effective Date ” means the date upon which the Arrangement becomes effective as set out in Section 2.8 of the Arrangement Agreement.

“ Effective Time ” means the time on the Effective Date specified as the “Effective Time” in the Closing Certificate.

“ Exchange Ratio ” means 0.72566 of a Choom Share for each Phivida Share.

“ Final Order ” means the final order of the Court made pursuant to Section 291 of the BCBCA, after a hearing upon the fairness of the terms and conditions of the Arrangement and after being informed of the intention to rely upon the Section 3(a)(10) Exemption from registration under the U.S. Securities Act in connection with the issuance of the Consideration and Replacement Options to Phivida Shareholders and Phivida Optionholders in the United States, in a form acceptable to Phivida and Choom, each acting reasonably, approving the Arrangement, as such order may be amended by the Court (with the consent of Phivida and Choom, each acting reasonably) at any time prior to the Effective Date or, if appealed, then, unless such appeal is withdrawn or dismissed, as affirmed or as amended (provided that any such amendment is acceptable to Phivida and Choom, each acting reasonably) on appeal.

“ Governmental Entity ” means (i) any international, multinational, national, federal, provincial, state, regional, municipal, local or other government, governmental or public department, central bank, court, tribunal, arbitral body, commission, commissioner, board, bureau, ministry, agency or instrumentality, domestic or foreign, (ii) any subdivision or authority of any of the above, (iii)

B-3

any quasi-governmental or private body exercising any regulatory, expropriation or taxing authority under or for the account of any of the foregoing or (iv) any stock exchange, including the CSE.

“ In-The-Money Amount ” in respect of a stock option means the amount, if any, by which the aggregate fair market value at that time of the securities subject to the option exceeds the aggregate exercise price of the option.

“ Law ” means, with respect to any Person, any and all applicable law (statutory, common or otherwise), constitution, treaty, convention, ordinance, code, rule, regulation, order, injunction, notice, judgment, decree, ruling or other similar requirement, whether domestic or foreign, enacted, adopted, promulgated or applied by a Governmental Entity that is binding upon or applicable to such Person or its business, undertaking, property or securities, and to the extent that they have the force of law, policies, guidelines, notices and protocols of any Governmental Entity, as amended.

“ Letter of Transmittal ” means the letter of transmittal to be delivered by Phivida to the Phivida Shareholders for use in connection with the Arrangement.

“ Lien ” means any mortgage, charge, pledge, hypothec, security interest, prior claim, encroachments, option, right of first refusal or first offer, occupancy right, covenant, assignment, lien (statutory or otherwise), defect of title, or restriction or adverse right or claim, or other third party interest or encumbrance of any kind, in each case, whether contingent or absolute.

“ Parties ” means Phivida and Choom and “ Party ” means any one of them.

“ Person ” includes any individual, partnership, association, body corporate, organization, trust, estate, trustee, executor, administrator, legal representative, government (including Governmental Entity), syndicate or other entity, whether or not having legal status.

“ Phivida ” means Phivida Holdings Inc., a company existing under the laws of the Province of British Columbia.

“ Phivida Circular ” means the notice of the Phivida Meeting and accompanying management information circular, including all schedules, appendices and exhibits to, and information incorporated by reference in, such management information circular, to be sent to Phivida Shareholders in connection with the Phivida Meeting, as amended, supplemented or otherwise modified from time to time in accordance with the terms of the Arrangement Agreement.

“ Phivida Meeting ” means the special meeting of Phivida Shareholders, including any adjournment or postponement of such special meeting in accordance with the terms of the Arrangement Agreement, to be called and held in accordance with the Interim Order to consider the Arrangement Resolution and for any other purpose as may be set out in the Phivida Circular and agreed to in writing by Choom, acting reasonably.

“ Phivida Optionholders ” means the holders of Phivida Options.

B-4

“ Phivida Option Plan ” means the share option plan approved by Phivida Optionholders on March 21, 2019.

“ Phivida Options ” means the outstanding options to purchase Phivida Shares issued pursuant to the Phivida Option Plan.

“ Phivida Shareholders ” means the registered or beneficial holders of Phivida Shares, as the context requires, except that with respect to Dissent Rights, Phivida Shareholders refers only to registered shareholders.

“ Phivida Shares ” means the common shares in the authorized share structure of Phivida.

“ Plan of Arrangement ” means this plan of arrangement, subject to any amendments or variations hereto made in accordance with Section 8.1 of the Arrangement Agreement or Section 6.1 hereto, or made at the direction of the Court in the Final Order with the prior written consent of Phivida and Choom, each acting reasonably.

“ Registrar ” means the Registrar of Companies appointed pursuant to Section 400 of the BCBCA.

“ Replacement Option ” has the meaning ascribed thereto in Section 3.1(1)(c);

“ Section 3(a)(10) Exemption ” means the exemption from the registration requirements of the U.S. Securities Act provided by Section 3(a)(10) thereof.

“ Tax Act ” means the Income Tax Act (Canada).

“ U.S. Securities Act ” means the United States Securities Act of 1933, as amended.

“ Withholding Obligation ” has the meaning ascribed thereto in Section 7.1(1).

==> picture [14 x 9] intentionally omitted <==

Interpretation Not Affected by Headings

The headings contained in this Plan of Arrangement are for convenience of reference only and shall not affect in any way the meaning or interpretation of this Plan of Arrangement. The terms “this Plan of Arrangement”, “hereof”, “herein”, “hereto”, “hereunder” and similar expressions refer to this Plan of Arrangement and not to any particular Article, Section or Subsection hereof and include any agreement or instrument supplementary or ancillary hereto.

==> picture [14 x 9] intentionally omitted <==

Date for any Action

If the date on which any action is required to be taken hereunder is not a Business Day, such action shall be required to be taken on the next succeeding day which is a Business Day.

==> picture [14 x 9] intentionally omitted <==

Number and Gender

In this Plan of Arrangement, unless the context otherwise requires, words importing the singular include the plural and vice versa, and words importing gender include all genders and neuter.

B-5

==> picture [14 x 8] intentionally omitted <==

References to Persons and Statutes

A reference to a Person includes any successor to that Person. Any reference to a statute or to a rule of a self-regulatory organization, including any stock exchange, refers to such statute or rule, and all rules and regulations, administrative policy statements, instruments, blanket orders, notices, directions and rulings issued or adopted under it, as it or they may have been or may from time to time be amended or re-enacted, unless stated otherwise.

==> picture [14 x 8] intentionally omitted <==

Currency

Unless otherwise stated in this Plan of Arrangement, all references herein to amounts of money are expressed in lawful money of Canada.

==> picture [14 x 9] intentionally omitted <==

Computation of Time

A period of time is to be computed as beginning on the day following the event that began the period and ending at 4:30 p.m. on the last day of the period, if the last day of the period is a Business Day, or at 4:30 p.m. on the next Business Day if the last day of the period is not a Business Day.

==> picture [14 x 9] intentionally omitted <==

Time References

Time shall be of the essence in every matter or action contemplated hereunder. References to time are to Pacific time.

==> picture [14 x 9] intentionally omitted <==

Including

The word “including” means “including, without limiting the generality of the foregoing”.

==> picture [45 x 8] intentionally omitted <==

ARRANGEMENT AGREEMENT; EFFECTIVENESS

==> picture [14 x 9] intentionally omitted <==

Effectiveness

(1) This Plan of Arrangement and the Arrangement are made pursuant to and subject to the provisions of the Arrangement Agreement.
(2) This Plan of Arrangement will become effective as at the Effective Time and will be binding (without any further authorization, act or formality on the part of the Court, the Registrar, or any other Person) from and after the Effective Time on Phivida, the holders of Phivida Shares and Phivida Options, Choom and the Depositary.
(3) As at and from the time set out in Section 3.1(1)(b) hereof:
(a) Phivida will be a wholly-owned subsidiary of Choom;
(b) the rights of creditors against the property and interests of Phivida will be unimpaired by the Arrangement; and

B-6

(c) Phivida Shareholders, other than Dissenters, will hold Choom Shares in replacement for their Phivida Shares, as provided by the Plan of Arrangement.

==> picture [45 x 9] intentionally omitted <==

THE ARRANGEMENT

==> picture [14 x 8] intentionally omitted <==

Arrangement

(1) At the Effective Time each of the following events shall occur and shall be deemed to occur sequentially as set out below without any further authorization, act or formality, in each case, unless stated otherwise, effective as at one minute intervals starting at the Effective Time:
(a) each Phivida Share outstanding immediately prior to the Effective Time held by a Phivida Shareholder in respect of which Dissent Rights have been validly exercised will be deemed to have been transferred without any further act or formality to Phivida for cancellation, free and clear of any Liens, and such Phivida Shareholder will cease to be the registered holder of such Dissenting Shares and will cease to have any rights as registered holders of such Phivida Shares other than the right to be paid by Phivida, out of its separate assets, fair value for such Dissenting Shares as set out in Section 4.1(2), and such Phivida Shareholder’s name will be removed as the registered holder of such Dissenting Shares from the central securities register of holders of Phivida Shares maintained by or on behalf of Phivida, and Phivida will be deemed to be the transferee of such Dissenting Shares, free and clear of any Liens, and such Dissenting Shares will be cancelled and returned to treasury of Phivida;
(b) each issued and outstanding Phivida Share (other than any Phivida Share in respect of which a Phivida Shareholder has validly exercised his, her or its Dissent Right) will be transferred to, and acquired by Choom, without any act or formality on the part of the holder of such Phivida Share or Choom, free and clear of all Liens, in exchange for the applicable Consideration, provided that the aggregate number of Choom Shares payable to any one Phivida Shareholder, if calculated to include a fraction of a Choom Share, will be rounded down to the nearest whole Choom Share, with no consideration being paid for the fractional share, such Phivida Shareholder will cease to be the holder of such Phivida Shares and the name of each such Phivida Shareholder will be removed from the central securities register of holders of Phivida Shares and added to the register of holders of Choom Shares, and Choom will be recorded as the registered holder of such Phivida Shares so exchanged and will be deemed to be the legal and beneficial owner thereof; and
(c) each Phivida Option which is outstanding and has not been duly exercised prior to the Effective Time (whether or unvested) notwithstanding the terms of the Phivida Option Plan, will be exchanged for an option (each, a “ Replacement Option ”) to purchase from Choom, the number of Choom Shares equal to the product obtained when (A) the number of Phivida Shares subject to the Phivida Option immediately prior to the Effective Time is multiplied by (B) the Exchange Ratio, provided that if the foregoing would result in the issuance of a fraction of a Choom Share on any particular exercise of Replacement Options, then the number of Choom Shares otherwise issuable shall be rounded down to the nearest whole number of Choom Shares. The exercise price per Choom Share subject

B-7

to a Replacement Option shall be an amount equal to the quotient obtained when (A) the exercise price per Phivida Share subject to each such Phivida Option immediately before the Effective Time, is divided by (B) the Exchange Ratio, provided that the aggregate exercise price payable on any particular exercise of Replacement Options shall be rounded up to the nearest whole cent. It is intended that the provisions of subsection 7(1.4) of the Tax Act apply to the exchange of a Phivida Option for a Replacement Option. Therefore, in the event that the In-The-Money Amount in respect of a Replacement Option (determined immediately after the Effective Time) exceeds the In-The- Money Amount in respect of the Phivida Option for which it is exchanged (determined immediately prior to the Effective Time), the number of Choom Shares which may be acquired on exercise of the Replacement Option at and after the Effective Time or the exercise price of such Replacement Option shall be adjusted accordingly, with effect at and from the Effective Time, to ensure that the In-The-Money Amount in respect of the Replacement Option (determined immediately after the Effective Time) does not exceed the In-The-Money Amount in respect of the Phivida Option (determined immediately prior to the Effective Time). Except as set out above, the term to expiry, conditions to and manner of exercise and other terms and conditions of each of the Replacement Options shall be the same as the terms and conditions of the Phivida Option for which it is exchanged and, for greater certainty, each Replacement Option shall continue to be governed by and be subject to the terms of the Phivida Stock Option Plan and the agreement evidencing the grant of such Phivida Option with respect to such terms and conditions. Any document previously evidencing a Phivida Option shall thereafter evidence and be deemed to evidence such Replacement Option and no certificates evidencing Replacement Options shall be issued.
(2) The Consideration shall be adjusted to reflect fully the effect of any stock split, reverse split, stock dividend (including any dividend or distribution of securities convertible into Choom Shares or Phivida Shares, other than stock dividends paid in lieu of ordinary course dividends), consolidation, reorganization, recapitalization or other like change with respect to Choom Shares or the Phivida Shares occurring after the date of the Arrangement Agreement and prior to the Effective Time.

==> picture [14 x 9] intentionally omitted <==

U.S. Securities Laws

(1) Notwithstanding any provision herein to the contrary, Choom and Phivida agree that the Plan of Arrangement will be carried out with the intention that all Consideration and Replacement Options to be issued in connection with the Arrangement shall be exempt from registration requirements of the U.S. Securities Act pursuant to the Section 3(a)(10) Exemption thereunder, and the Consideration and Replacement Options to be distributed in the United States pursuant to the Arrangement shall not be subject to resale restrictions in the United States under the U.S. Securities Act (other than as may be prescribed by Rule 144 and Rule 145 under the U.S. Securities Act).

B-8

==> picture [46 x 8] intentionally omitted <==

RIGHTS OF DISSENT

==> picture [14 x 8] intentionally omitted <==

Dissent Rights

(1) Registered holders of Phivida Shares may exercise rights of dissent (the “ Dissent Rights ”) in connection with the Arrangement pursuant to the Interim Order and in the manner set forth in sections 237 to 247 of the BCBCA (collectively, the “ Dissent Procedures ”), provided that the written notice setting forth the objection of such registered Phivida Shareholder to the Arrangement contemplated by Section 242 of the BCBCA must be received by Phivida not later than 4:30 p.m. (Vancouver time) on the Business Day that is two (2) Business Days before the Phivida Meeting.
(2) Phivida Shareholders who duly and validly exercise Dissent Rights with respect to their Phivida Shares (“ Dissenting Shares ”) and who:
(a) are ultimately entitled to be paid fair value for their Dissenting Shares will be deemed to have transferred their Dissenting Shares to Phivida under Section 3.1(1)(a) and shall be paid an amount equal to such fair value by Phivida out of its separate assets; or
(b) for any reason are ultimately not entitled to be paid fair value for their Dissenting Shares, will be deemed to have participated in the Arrangement on the same basis as a non-dissenting Phivida Shareholder and will receive Choom Shares on the same basis as every other non-dissenting Phivida Shareholder;

but in no case will Phivida or Choom be required to recognize such persons as holding Phivida Shares on or after the Effective Date. For greater certainty, in no case shall Phivida, Choom or any other Person be required to recognize Dissenting Shareholders as Phivida Shareholders after the Effective Time, and the names of such Dissenting Shareholders shall be deleted from the central securities register of holders of Phivida Shares as of the Effective Time.

(3) In addition to any other restrictions set forth in the BCBCA, none of the following shall be entitled to exercise Dissent Rights:
(a) Phivida Shareholders who vote, or who have instructed a proxyholder to vote, in favour of the Arrangement Resolution; and
(b) Phivida Optionholders.

==> picture [45 x 9] intentionally omitted <==

DELIVERY OF CONSIDERATION

==> picture [14 x 9] intentionally omitted <==

Delivery of Shares

(1) Prior to the Effective Time, Choom will deposit the Choom Shares with the Depositary to satisfy the Consideration issuable to the Phivida Shareholders pursuant to this Plan of Arrangement (other than with respect to Dissenting Shares held by Dissenters who have not withdrawn their notice of objection).

B-9

(2) After the Effective Time, certificates formerly representing Phivida Shares which are held by a Phivida Shareholder other than Dissenting Shares, will represent only the right to receive the Consideration issuable therefor pursuant to this Article 5 in accordance with the terms of this Plan of Arrangement.
(3) No dividends or other distributions declared or made after the Effective Time with respect to the Choom Shares with a record date on or after the Effective Date will be payable or paid to the holder of any unsurrendered certificate or certificates for Phivida Shares which, immediately prior to the Effective Date, represented outstanding Phivida Shares, until the surrender of certificates for Phivida Shares in exchange for the Consideration issuable therefor pursuant to the terms of this Plan of Arrangement. Subject to applicable Law and to Section 5.1 hereof, at the time of such surrender, there shall, in addition to the delivery of Consideration to which such Phivida Shareholder is thereby entitled, be delivered to such holder, without interest, the amount of the dividend or other distribution with a record date after the Effective Time theretofore paid with respect to such Choom Shares.
(4) As soon as reasonably practicable after the Effective Time (subject to Section 5.2), the Depositary will forward to each Phivida Shareholder that submitted a duly completed Letter of Transmittal to the Depositary, together with the certificate (if any) representing the Phivida Shares held by such Phivida Shareholder, the certificates representing the Choom Shares issued to such Phivida Shareholder pursuant to Section 3.1(1)(b), which shares will be registered in such name or names as set out in the Letter of Transmittal and either (i) delivered to the address or addresses as such Phivida Shareholder directed in their Letter of Transmittal or (ii) made available for pick up at the offices of the Depositary in accordance with the instructions of the Phivida Shareholder in the Letter of Transmittal.
(5) Phivida Shareholders that did not submit an effective Letter of Transmittal prior to the Effective Date may take delivery of the Consideration issuable to them by delivering the certificates representing Phivida Shares formerly held by them to the Depositary at the offices indicated in the Letter of Transmittal. Such certificates must be accompanied by a duly completed Letter of Transmittal, together with such other documents as the Depositary may require. Certificates representing the Choom Shares issued to such Phivida Shareholder pursuant to this Plan of Arrangement will be registered in such name or names as set out in the Letter of Transmittal and either (i) delivered to the address or addresses as such Phivida Shareholder directed in their Letter of Transmittal or (ii) made available for pick up at the offices of the Depositary in accordance with the instructions of the Phivida Shareholder in the Letter of Transmittal, as soon as reasonably practicable after receipt by the Depositary of the required certificates and documents.
(6) Any certificate which immediately prior to the Effective Time represented outstanding Phivida Shares and which has not been surrendered, with all other instruments required by this Article 5, on or prior to the sixth anniversary of the Effective Date, will cease to represent any claim against or interest of any kind or nature in Phivida, Choom or the Depositary.

==> picture [14 x 8] intentionally omitted <==

Lost Certificates

(1) In the event any certificate, which immediately before the Effective Time represented one or more outstanding Phivida Shares that was exchanged pursuant to this Plan of Arrangement, is

B-10

lost, stolen or destroyed, upon the making of an affidavit of that fact by the Person claiming such certificate to be lost, stolen or destroyed, the Depositary will issue in exchange for such lost, stolen or destroyed certificate, the Consideration to which such Person is entitled in respect of the Phivida Shares represented by such lost, stolen, or destroyed certificate pursuant to this Plan of Arrangement deliverable in accordance with such Person’s Letter of Transmittal.

(2) When authorizing such delivery of Choom Shares that such holder is entitled to receive in exchange for any lost, stolen or destroyed certificate, the Person to whom such Choom Shares are to be delivered shall, as a condition precedent to the delivery of such Choom Shares, give a bond satisfactory to Choom and the Depositary in such sum as Choom and the Depositary may direct and indemnify Choom and the Depositary in a manner satisfactory to Choom and the Depositary, against any claim that may be made against Choom or the Depositary with respect to the certificate alleged to have been lost, stolen or destroyed.

==> picture [46 x 8] intentionally omitted <==

AMENDMENT

==> picture [14 x 9] intentionally omitted <==

Amendment

(1) Phivida and Choom may amend, modify and/or supplement this Plan of Arrangement at any time and from time to time prior to the Effective Time, provided that any such amendment, modification or supplement must be approved by Phivida and Choom, each acting reasonably, and, if made following the Phivida Meeting, approved by the Court and communicated to Phivida Shareholders and others as may be required by the Interim Order in the manner required by the Court (if so required).
(2) Any amendment, modification or supplement to this Plan of Arrangement which is directed by the Court following the Phivida Meeting shall be effective only if (i) it is consented to in writing by Phivida and Choom, each acting reasonably, and (ii) if required by the Court, it is consented to by Phivida Shareholders in the manner directed by the Court.
(3) Any amendment, modification or supplement to this Plan of Arrangement may be proposed by Phivida or by Choom at any time prior to the Phivida Meeting, provided that Phivida and Choom shall each have consented thereto in writing, with or without any other prior notice or communication, and if so proposed and accepted by the Persons voting at the Phivida Meeting in accordance with the Interim Order, shall become part of this Plan of Arrangement for all purposes.
(4) This Plan of Arrangement may be withdrawn prior to the Effective Time in accordance with the terms of the Arrangement Agreement.
(5) Any amendment, modification or supplement to this Plan of Arrangement may be made following the Effective Date unilaterally by Phivida, provided that it concerns a matter which, in the reasonable opinion of Phivida, is of an administrative nature required to better give effect to the implementation of this Plan of Arrangement and is not adverse to the financial or economic interest of any former Phivida Shareholder.

B-11

==> picture [46 x 8] intentionally omitted <==

WITHHOLDING TAX

==> picture [14 x 8] intentionally omitted <==

Withholding Tax

(1) Choom, Phivida and the Depositary, as the case may be, shall be entitled to deduct or withhold from any amounts contemplated to be payable to any Phivida Shareholder or Phivida Optionholder under this Plan of Arrangement (an “ Affected Person ”) such amounts as are required to be deducted or withheld with respect to such payment (a “ Withholding Obligation ”) under the Tax Act or any other provision of federal, provincial, territorial, state, local or foreign tax Law, in each case, as amended, and shall remit or cause to be remitted the amount so deducted or withheld to the appropriate Governmental Entity. To the extent that amounts are so deducted or withheld, such deducted or withheld amounts shall be treated for all purposes as having been paid to the recipient of the payment in respect of which such deduction or withholding was made, provided that such deducted or withheld amounts are actually remitted in accordance with applicable law to the appropriate taxing authority.
(2) Each of Phivida, Choom and the Depositary shall also have the right to:
(a) deduct, withhold and sell, or direct Choom, Phivida or the Depositary to deduct, withhold and sell through a broker (the “ Broker ”), and on behalf of any Affected Person; or
(b) require the Affected Person to irrevocably direct the sale through a Broker and irrevocably direct the Broker pay the proceeds of such sale to Choom, Phivida or the Depositary as appropriate (and, in the absence of such irrevocable direction, the Affected Person shall be deemed to have provided such irrevocable direction),

such number of Choom Shares delivered or deliverable to such Affected Person pursuant to this Plan of Arrangement as is necessary to produce sale proceeds (after deducting commissions payable to the Broker and other costs and expenses) sufficient to fund any Withholding Obligations. Any such sale of Choom Shares shall be effected on a public market and as soon as practicable following the Effective Date. None of Choom, Phivida, the Depositary or the Broker will be liable for any loss arising out of any sale of such Choom Shares, including any loss relating to the manner or timing of such sales, the prices at which the Choom Shares are sold or otherwise.

==> picture [46 x 8] intentionally omitted <==

PARAMOUNTCY

==> picture [14 x 8] intentionally omitted <==

Paramountcy

(1) From and after the Effective Time:
(a) this Plan of Arrangement shall take precedence and priority over any and all rights related to the Phivida Option Plan, Phivida Options and Phivida Shares outstanding prior to the Effective Time;

B-12

(b) the rights and obligations of Phivida Shareholders, Phivida Optionholders and any trustee and transfer agent therefor, shall be solely as provided for in this Plan of Arrangement; and
(c) all actions, causes of action, claims or proceedings (actual or contingent and whether or not previously asserted) based on or in any way relating to the Phivida Shares or Phivida Options shall be deemed to have been settled, compromised, released and determined without liability except as set forth in this Plan of Arrangement.

==> picture [45 x 9] intentionally omitted <==

FURTHER ASSURANCES

==> picture [14 x 9] intentionally omitted <==

Further Assurances

(1) Notwithstanding that the transactions and events set out in this Plan of Arrangement shall occur and be deemed to have occurred in the order set out herein without any further authorization, act or formality, each of the Parties shall make, do and execute, or cause to be made, done and executed, all such further acts, deeds, agreements, transfers, assurances, instruments or documents as may reasonably be required by any of them in order to implement this Plan of Arrangement and to further document or evidence any of the transactions or events set out herein.

B-13

Appendix “A” to the Plan of Arrangement – Closing Certificate

Re: Arrangement Agreement dated June 2, 2020 between Choom Holdings Inc. and Phivida Holdings Inc. (the “ Arrangement Agreement ”)

Defined terms used but not defined in this certificate shall have the meaning ascribed thereto in the Arrangement Agreement.

Each of the undersigned hereby confirms that the undersigned is satisfied that the conditions precedent to its respective obligations to complete the Arrangement Agreement have been satisfied and that the Arrangement is completed as of __ (a.m./p.m. Vancouver local time) (the “ Effective Time ”) on __, 2020 (the “ Effective Date ”).

CHOOM HOLDINGS INC.

Per: Name: Title:

PHIVIDA HOLDINGS INC.

Per: Name: Title:

C-1

APPENDIX “C”

INTERIM ORDER

(see materials attached hereto)

C-2

C-3

C-4

C-5

C-6

C-7

C-8

C-9

C-10

C-11

D-1

APPENDIX “D”

NOTICE OF HEARING OF PETITION

(see materials attached hereto)

D-2

No. S-207642 Vancouver Registry

IN THE SUPREME COURT OF BRITISH COLUMBIA

IN THE MATTER OF SECTION 288 OF THE BUSINESS CORPORATIONS ACT (BRITISH COLUMBIA), S.B.C. 2002, C. 57, AS AMENDED

AND

IN THE MATTER OF AN ARRANGEMENT INVOLVING PHIVIDA HOLDINGS INC., CERTAIN OF ITS SECURITYHOLDERS, AND CHOOM HOLDINGS INC.

Re: PHIVIDA HOLDINGS INC., PETITIONER

NOTICE OF HEARING OF PETITION

TAKE NOTICE that the petition of Phivida Holdings Inc. (“ Phivida ” or the “ Petitioner ”) dated July 31, 2020 for approval of a plan of arrangement (the “ Arrangement ”) pursuant to the Business Corporations Act (British Columbia), S.B.C. 2002, c. 57, as amended, and for an Order (the “ Final Order ”) determining that the Arrangement, including the terms and conditions thereof and the distributions, issuances, exchanges and/or adjustments of securities contemplated therein, is procedurally and substantively fair and reasonable to the holders of common shares and stock options of the Petitioner (the “ Securityholders ”) and is approved by the Court, will be heard at the courthouse at 800 Smithe Street, Vancouver, BC V6Z 2E1 on September 9, 2020 at 9:45 a.m. or as soon thereafter as counsel may be heard (the “ Final Application ”).

AND NOTICE IS FURTHER GIVEN that by an Order Made After Application of the Supreme Court of British Columbia, pronounced August 5, 2020 the Court has given directions as to the calling of the annual general and special meeting of the registered holders of common shares of the Petitioner for the purpose of, among other things, considering and voting upon the Arrangement and approving the Arrangement.

AND NOTICE IS FURTHER GIVEN that the Final Order approving the Arrangement as procedurally and substantively fair and reasonable to the Securityholders will, if made, serve as the basis of a claim to an exemption from the registration requirements of the United States Securities Act of 1933, as amended (the “ U.S. Securities Act ”), pursuant to Section 3(a)(10) thereof, regarding the issuance, exchange and distribution of common shares of Choom Holdings Inc. and options to purchase common shares of Choom Holdings Inc. to the holders of common shares and stock options of the Petitioner, respectively.

IF YOU WISH TO BE HEARD, any Securityholder, any director or auditor of the Petitioner, or any other interested party with leave of the Court, may appear and make submissions at the hearing of the application for the Final Application provided that such

D-3

person first files a Response to Petition, in the form prescribed by the Supreme Court Civil Rules and delivers a copy of the filed Response to Petition, together with a copy of all material on which such person intends to rely at the Final Application, including an outline of such person’s proposed submissions, on or before 4:00 p.m. (Vancouver time) on September 7, 2020, or as the Court may otherwise direct, to the solicitors for the Petitioner at:

Gowling WLG (Canada) LLP 550 Burrard Street, Suite 2300 Vancouver, British Columbia V6C 2B5 Attention: Martin L. Palleson and Jonathan B. Ross

IF YOU WISH TO BE NOTIFIED OF ANY ADJOURNMENT OF THE FINAL APPLICATION, YOU MUST GIVE NOTICE OF YOUR INTENTION by filing and delivering a Response to Petition, as aforesaid.

AT THE HEARING OF THE FINAL APPLICATION, the Court may approve the Arrangement as presented, or may approve it subject to such terms and conditions as the Court deems fit.

IF YOU DO NOT FILE A RESPONSE TO PETITION and attend either in person or by counsel at the time of such hearing, the Court may approve the Arrangement, as presented, or may approve it subject to such terms and conditions as the Court shall deem fit, all without any further notice to you. If the Arrangement is approved, it will significantly affect the rights of the Securityholders.

Date: August 5, 2020

==> picture [107 x 59] intentionally omitted <==

Signature of lawyer for Petitioner Jonathan B. Ross

E-1

APPENDIX “E”

DISSENT PROVISIONS OF THE BCBCA

Definitions and application

237 (1) In this Division:

“dissenter” means a shareholder who, being entitled to do so, sends written notice of dissent when and as required by section 242;

“notice shares” means, in relation to a notice of dissent, the shares in respect of which dissent is being exercised under the notice of dissent;

“payout value” means,

(a) in the case of a dissent in respect of a resolution, the fair value that the notice shares had immediately before the passing of the resolution,
(b) in the case of a dissent in respect of an arrangement approved by a court order made under section 291 (2) (c) that permits dissent, the fair value that the notice shares had immediately before the passing of the resolution adopting the arrangement,
(c) in the case of a dissent in respect of a matter approved or authorized by any other court order that permits dissent, the fair value that the notice shares had at the time specified by the court order, or
(d) in the case of a dissent in respect of a community contribution company, the value of the notice shares set out in the regulations,

excluding any appreciation or depreciation in anticipation of the corporate action approved or authorized by the resolution or court order unless exclusion would be inequitable.

(2) This Division applies to any right of dissent exercisable by a shareholder except to the extent that
(a) the court orders otherwise, or
(b) in the case of a right of dissent authorized by a resolution referred to in section 238 (1) (g), the court orders otherwise or the resolution provides otherwise.

Right to dissent

238 (1) A shareholder of a company, whether or not the shareholder’s shares carry the right to vote, is entitled to dissent as follows:

(a) under section 260, in respect of a resolution to alter the articles
(i) to alter restrictions on the powers of Phivida or on the business Phivida is permitted to carry on, or

E-2

  - (ii) without limiting subparagraph (i), in the case of a community contribution company, to alter any of Phivida’s community purposes within the meaning of section 51.91;

(b) under section 272, in respect of a resolution to adopt an amalgamation agreement;
(c) under section 287, in respect of a resolution to approve an amalgamation under Division 4 of Part 9;
(d) in respect of a resolution to approve an arrangement, the terms of which arrangement permit dissent;
(e) under section 301 (5), in respect of a resolution to authorize or ratify the sale, lease or other disposition of all or substantially all of Phivida’s undertaking;
(f) under section 309, in respect of a resolution to authorize the continuation of Phivida into a jurisdiction other than British Columbia;
(g) in respect of any other resolution, if dissent is authorized by the resolution;
(h) in respect of any court order that permits dissent.
(2) A shareholder wishing to dissent must
(a) prepare a separate notice of dissent under section 242 for
- (i) the shareholder, if the shareholder is dissenting on the shareholder’s own behalf, and
- (ii) each other person who beneficially owns shares registered in the shareholder’s name and on whose behalf the shareholder is dissenting,
(b) identify in each notice of dissent, in accordance with section 242 (4), the person on whose behalf dissent is being exercised in that notice of dissent, and
(c) dissent with respect to all of the shares, registered in the shareholder’s name, of which the person identified under paragraph (b) of this subsection is the beneficial owner.

(3) Without limiting subsection (2), a person who wishes to have dissent exercised with respect to shares of which the person is the beneficial owner must

(a) dissent with respect to all of the shares, if any, of which the person is both the registered owner and the beneficial owner, and
(b) cause each shareholder who is a registered owner of any other shares of which the person is the beneficial owner to dissent with respect to all of those shares.

E-3

Waiver of right to dissent

239 (1) A shareholder may not waive generally a right to dissent but may, in writing, waive the right to dissent with respect to a particular corporate action.

(2) A shareholder wishing to waive a right of dissent with respect to a particular corporate action must

(a) provide to Phivida a separate waiver for
(i) the shareholder, if the shareholder is providing a waiver on the shareholder’s own behalf, and
(ii) each other person who beneficially owns shares registered in the shareholder’s name and on whose behalf the shareholder is providing a waiver, and
(b) identify in each waiver the person on whose behalf the waiver is made.

(3) If a shareholder waives a right of dissent with respect to a particular corporate action and indicates in the waiver that the right to dissent is being waived on the shareholder’s own behalf, the shareholder’s right to dissent with respect to the particular corporate action terminates in respect of the shares of which the shareholder is both the registered owner and the beneficial owner, and this Division ceases to apply to

(a) the shareholder in respect of the shares of which the shareholder is both the registered owner and the beneficial owner, and
(b) any other shareholders, who are registered owners of shares beneficially owned by the first mentioned shareholder, in respect of the shares that are beneficially owned by the first mentioned shareholder.

(4) If a shareholder waives a right of dissent with respect to a particular corporate action and indicates in the waiver that the right to dissent is being waived on behalf of a specified person who beneficially owns shares registered in the name of the shareholder, the right of shareholders who are registered owners of shares beneficially owned by that specified person to dissent on behalf of that specified person with respect to the particular corporate action terminates and this Division ceases to apply to those shareholders in respect of the shares that are beneficially owned by that specified person.

Notice of resolution

240 (1) If a resolution in respect of which a shareholder is entitled to dissent is to be considered at a meeting of shareholders, Phivida must, at least the prescribed number of days before the date of the proposed meeting, send to each of its shareholders, whether or not their shares carry the right to vote,

(a) a copy of the proposed resolution, and
(b) a notice of the meeting that specifies the date of the meeting, and contains a statement advising of the right to send a notice of dissent.

E-4

(2) If a resolution in respect of which a shareholder is entitled to dissent is to be passed as a consent resolution of shareholders or as a resolution of directors and the earliest date on which that resolution can be passed is specified in the resolution or in the statement referred to in paragraph (b), Phivida may, at least 21 days before that specified date, send to each of its shareholders, whether or not their shares carry the right to vote,

(a) a copy of the proposed resolution, and
(b) a statement advising of the right to send a notice of dissent.

(3) If a resolution in respect of which a shareholder is entitled to dissent was or is to be passed as a resolution of shareholders without Phivida complying with subsection (1) or (2), or was or is to be passed as a directors’ resolution without Phivida complying with subsection (2), Phivida must, before or within 14 days after the passing of the resolution, send to each of its shareholders who has not, on behalf of every person who beneficially owns shares registered in the name of the shareholder, consented to the resolution or voted in favour of the resolution, whether or not their shares carry the right to vote,

(a) a copy of the resolution,
(b) a statement advising of the right to send a notice of dissent, and
(c) if the resolution has passed, notification of that fact and the date on which it was passed.

(4) Nothing in subsection (1), (2) or (3) gives a shareholder a right to vote in a meeting at which, or on a resolution on which, the shareholder would not otherwise be entitled to vote.

Notice of court orders

241 If a court order provides for a right of dissent, Phivida must, not later than 14 days after the date on which Phivida receives a copy of the entered order, send to each shareholder who is entitled to exercise that right of dissent

(a) a copy of the entered order, and
(b) a statement advising of the right to send a notice of dissent.

Notice of dissent

242 (1) A shareholder intending to dissent in respect of a resolution referred to in section 238 (1) (a), (b), (c), (d), (e) or (f) must,

(a) if Phivida has complied with section 240 (1) or (2), send written notice of dissent to Phivida at least 2 days before the date on which the resolution is to be passed or can be passed, as the case may be,
(b) if Phivida has complied with section 240 (3), send written notice of dissent to Phivida not more than 14 days after receiving the records referred to in that section, or

E-5

(c) if Phivida has not complied with section 240 (1), (2) or (3), send written notice of dissent to Phivida not more than 14 days after the later of
(i) the date on which the shareholder learns that the resolution was passed, and
(ii) the date on which the shareholder learns that the shareholder is entitled to dissent.

(2) A shareholder intending to dissent in respect of a resolution referred to in section 238 (1) (g) must send written notice of dissent to Phivida

(a) on or before the date specified by the resolution or in the statement referred to in section 240 (2) (b) or (3) (b) as the last date by which notice of dissent must be sent, or
(b) if the resolution or statement does not specify a date, in accordance with subsection (1) of this section.
(3) A shareholder intending to dissent under section 238 (1) (h) in respect of a court order that permits dissent must send written notice of dissent to Phivida
(a) within the number of days, specified by the court order, after the shareholder receives the records referred to in section 241, or
(b) if the court order does not specify the number of days referred to in paragraph (a) of this subsection, within 14 days after the shareholder receives the records referred to in section 241.

(4) A notice of dissent sent under this section must set out the number, and the class and series, if applicable, of the notice shares, and must set out whichever of the following is applicable:

(a) if the notice shares constitute all of the shares of which the shareholder is both the registered owner and beneficial owner and the shareholder owns no other shares of Phivida as beneficial owner, a statement to that effect;
(b) if the notice shares constitute all of the shares of which the shareholder is both the registered owner and beneficial owner but the shareholder owns other shares of Phivida as beneficial owner, a statement to that effect and
(i) the names of the registered owners of those other shares,
(ii) the number, and the class and series, if applicable, of those other shares that are held by each of those registered owners, and
(iii) a statement that notices of dissent are being, or have been, sent in respect of all of those other shares;
(c) if dissent is being exercised by the shareholder on behalf of a beneficial owner who is not the dissenting shareholder, a statement to that effect and

E-6

(i) the name and address of the beneficial owner, and
(ii) a statement that the shareholder is dissenting in relation to all of the shares beneficially owned by the beneficial owner that are registered in the shareholder’s name.

(5) The right of a shareholder to dissent on behalf of a beneficial owner of shares, including the shareholder, terminates and this Division ceases to apply to the shareholder in respect of that beneficial owner if subsections (1) to (4) of this section, as those subsections pertain to that beneficial owner, are not complied with.

Notice of intention to proceed

243 (1) A company that receives a notice of dissent under section 242 from a dissenter must,

(a) if Phivida intends to act on the authority of the resolution or court order in respect of which the notice of dissent was sent, send a notice to the dissenter promptly after the later of
- (i) the date on which Phivida forms the intention to proceed, and
- (ii) the date on which the notice of dissent was received, or
(b) if Phivida has acted on the authority of that resolution or court order, promptly send a notice to the dissenter.
(2) A notice sent under subsection (1) (a) or (b) of this section must
(a) be dated not earlier than the date on which the notice is sent,
(b) state that Phivida intends to act, or has acted, as the case may be, on the authority of the resolution or court order, and
(c) advise the dissenter of the manner in which dissent is to be completed under section 244.

Completion of dissent

244 (1) A dissenter who receives a notice under section 243 must, if the dissenter wishes to proceed with the dissent, send to Phivida or its transfer agent for the notice shares, within one month after the date of the notice,

(a) a written statement that the dissenter requires Phivida to purchase all of the notice shares,
(b) the certificates, if any, representing the notice shares, and
(c) if section 242 (4) (c) applies, a written statement that complies with subsection (2) of this section.

E-7

(2) The written statement referred to in subsection (1) (c) must
(a) be signed by the beneficial owner on whose behalf dissent is being exercised, and
(b) set out whether or not the beneficial owner is the beneficial owner of other shares of Phivida and, if so, set out
- (i) the names of the registered owners of those other shares,
- (ii) the number, and the class and series, if applicable, of those other shares that are held by each of those registered owners, and
- (iii) that dissent is being exercised in respect of all of those other shares.
(3) After the dissenter has complied with subsection (1),
(a) the dissenter is deemed to have sold to Phivida the notice shares, and
(b) Phivida is deemed to have purchased those shares, and must comply with section 245, whether or not it is authorized to do so by, and despite any restriction in, its memorandum or articles.

(4) Unless the court orders otherwise, if the dissenter fails to comply with subsection (1) of this section in relation to notice shares, the right of the dissenter to dissent with respect to those notice shares terminates and this Division, other than section 247, ceases to apply to the dissenter with respect to those notice shares.

(5) Unless the court orders otherwise, if a person on whose behalf dissent is being exercised in relation to a particular corporate action fails to ensure that every shareholder who is a registered owner of any of the shares beneficially owned by that person complies with subsection (1) of this section, the right of shareholders who are registered owners of shares beneficially owned by that person to dissent on behalf of that person with respect to that corporate action terminates and this Division, other than section 247, ceases to apply to those shareholders in respect of the shares that are beneficially owned by that person.

(6) A dissenter who has complied with subsection (1) of this section may not vote, or exercise or assert any rights of a shareholder, in respect of the notice shares, other than under this Division.

Payment for notice shares

245 (1) A company and a dissenter who has complied with section 244 (1) may agree on the amount of the payout value of the notice shares and, in that event, Phivida must

(a) promptly pay that amount to the dissenter, or
(b) if subsection (5) of this section applies, promptly send a notice to the dissenter that Phivida is unable lawfully to pay dissenters for their shares.

E-8

(2) A dissenter who has not entered into an agreement with Phivida under subsection (1) or Phivida may apply to the court and the court may

(a) determine the payout value of the notice shares of those dissenters who have not entered into an agreement with Phivida under subsection (1), or order that the payout value of those notice shares be established by arbitration or by reference to the registrar, or a referee, of the court,
(b) join in the application each dissenter, other than a dissenter who has entered into an agreement with Phivida under subsection (1), who has complied with section 244 (1), and
(c) make consequential orders and give directions it considers appropriate.

(3) Promptly after a determination of the payout value for notice shares has been made under subsection (2) (a) of this section, Phivida must

(a) pay to each dissenter who has complied with section 244 (1) in relation to those notice shares, other than a dissenter who has entered into an agreement with Phivida under subsection (1) of this section, the payout value applicable to that dissenter’s notice shares, or
(b) if subsection (5) applies, promptly send a notice to the dissenter that Phivida is unable lawfully to pay dissenters for their shares.
(4) If a dissenter receives a notice under subsection (1) (b) or (3) (b),
(a) the dissenter may, within 30 days after receipt, withdraw the dissenter’s notice of dissent, in which case Phivida is deemed to consent to the withdrawal and this Division, other than section 247, ceases to apply to the dissenter with respect to the notice shares, or
(b) if the dissenter does not withdraw the notice of dissent in accordance with paragraph (a) of this subsection, the dissenter retains a status as a claimant against Phivida, to be paid as soon as Phivida is lawfully able to do so or, in a liquidation, to be ranked subordinate to the rights of creditors of Phivida but in priority to its shareholders.

(5) A company must not make a payment to a dissenter under this section if there are reasonable grounds for believing that

(a) Phivida is insolvent, or
(b) the payment would render Phivida insolvent.

Loss of right to dissent

246 The right of a dissenter to dissent with respect to notice shares terminates and this Division, other than section 247, ceases to apply to the dissenter with respect to those notice shares, if, before payment is made to the dissenter of the full amount of money to which the dissenter is entitled under section 245 in relation to those notice shares, any of the following events occur:

E-9

(a) the corporate action approved or authorized, or to be approved or authorized, by the resolution or court order in respect of which the notice of dissent was sent is abandoned;
(b) the resolution in respect of which the notice of dissent was sent does not pass;
(c) the resolution in respect of which the notice of dissent was sent is revoked before the corporate action approved or authorized by that resolution is taken;
(d) the notice of dissent was sent in respect of a resolution adopting an amalgamation agreement and the amalgamation is abandoned or, by the terms of the agreement, will not proceed;
(e) the arrangement in respect of which the notice of dissent was sent is abandoned or by its terms will not proceed;
(f) a court permanently enjoins or sets aside the corporate action approved or authorized by the resolution or court order in respect of which the notice of dissent was sent;
(g) with respect to the notice shares, the dissenter consents to, or votes in favour of, the resolution in respect of which the notice of dissent was sent;
(h) the notice of dissent is withdrawn with the written consent of Phivida;
(i) the court determines that the dissenter is not entitled to dissent under this Division or that the dissenter is not entitled to dissent with respect to the notice shares under this Division.

Shareholders entitled to return of shares and rights

247 If, under section 244 (4) or (5), 245 (4) (a) or 246, this Division, other than this section, ceases to apply to a dissenter with respect to notice shares,

(a) Phivida must return to the dissenter each of the applicable share certificates, if any, sent under section 244 (1) (b) or, if those share certificates are unavailable, replacements for those share certificates,
(b) the dissenter regains any ability lost under section 244 (6) to vote, or exercise or assert any rights of a shareholder, in respect of the notice shares, and
(c) the dissenter must return any money that Phivida paid to the dissenter in respect of the notice shares under, or in purported compliance with, this Division.

F-1

APPENDIX “F”

FAIRNESS OPINION

(see materials attached hereto)

F-2

==> picture [164 x 67] intentionally omitted <==

June 2, 2020

Phivida Holdings Inc. 422 Richards St Suite 170 Vancouver, British Columbia V6B 2Z4

To the Special Committee and the Board of Directors:

Haywood Securities Inc. (“ Haywood” ) understands that Phivida Holdings Inc. (“ Phivida ”) has entered into a definitive arrangement agreement dated June 2, 2020 (the “ Agreement ”) pursuant to which Choom Holdings Inc. (“ Choom ”) will acquire all of the issued and outstanding common shares of Phivida (the “ Phivida Shares ”) in exchange for common shares of Choom (the “ Choom Shares ”) (the “ Transaction ”).

The Transaction

Haywood further understands that holders of Phivida Shares (the “ Phivida Shareholders ”) will receive 0.72566 of a Choom Share in exchange for each Phivida Share held (the “ Consideration ”) based on $0.082 per Phivida Share, representing a 10% premium to the 20-day volume weighted average price of the Phivida Shares ending June 2, 2020, and based on a 20-day volume weighted average price of the Choom Shares for the same period, being $0.113 per Choom Share.

The terms of, and conditions necessary to complete, the Transaction are set forth in the Agreement and will be described in a management information circular (the “ Circular ”) to be mailed to the Phivida Shareholders in connection with the special meeting of Phivida Shareholders to consider, among other matters, and, if deemed advisable, to approve the Transaction.

Haywood understands that officers and directors of Phivida, and certain Phivida Shareholders, who together control, as of June 2, 2020 approximately 31% of the outstanding Phivida Shares, have entered into support and voting agreements (each, a “ Phivida Support and Voting Agreement ”) pursuant to which, among other things, each such officer, director and shareholder will vote their Phivida Shares in favour of the Transaction.

The special committee (the “ Special Committee ”) and the board of directors (the “ Board ”) of Phivida has retained Haywood to prepare and render an opinion (this “ Fairness Opinion ”) as to the fairness of the Consideration, from a financial point of view, to the Phivida Shareholders. Haywood has not prepared a valuation of Phivida or Choom or any of their subsidiaries and assets, and this Fairness Opinion should not be construed as such.

F-3

Engagement

Pursuant to a letter agreement dated May 13, 2020 (the “ Engagement Agreement ”), Phivida engaged Haywood to render an opinion as to the fairness of the Consideration, from a financial point of view, to the Phivida Shareholders.

Following its review of the terms of the Transaction, Haywood rendered its verbal opinion to the Special Committee as to the fairness of the Consideration, from a financial point of view, to the Phivida Shareholders. This Fairness Opinion confirms the verbal opinion rendered by Haywood to the Special Committee on June 2, 2020. The data used for Haywood’s analyses in the verbal opinion and in this Fairness Opinion is as of June 2, 2020. The Effective Date of this Fairness Opinion is June 2, 2020.

The terms of the Engagement Agreement provide that Haywood is to be paid a fixed fee for the delivery of the Fairness Opinion, no portion of which is conditional upon this Fairness Opinion being favourable. Phivida has also agreed to reimburse Haywood for its reasonable out-of-pocket expenses whether or not the Transaction is completed and to indemnify Haywood, its affiliates, and their respective directors, officers, employees, agents and controlling persons, against certain losses, claims, damages and liabilities which may arise directly or indirectly from services performed by Haywood in connection with its engagement.

Independence of Haywood

Neither Haywood, nor any of its affiliates, is an insider, associate or affiliate of any of Choom or Phivida or any of their respective associates or affiliates. Haywood has not entered into any other agreements or arrangements with Choom or Phivida or any of their associates or affiliates with respect to any future dealings and has not been engaged in financing activities for any of Choom or Phivida or any of their respective associates or affiliates, except that Haywood previously provided a fairness opinion dated April 29, 2019 to Phivida in connection with its acquisition of Wikala.com Inc. In addition, Haywood has previously participated in Phivida’s Initial Public Offering in July 2017 and Phivida’s bought deal offering in March 2018.

Haywood acts as a trader and dealer, both as principal and agent, in major financial markets and, as such, may have had and may in the future have positions in the securities of Choom and Phivida or any of their respective associates or affiliates and, from time to time, may have executed or may execute transactions on behalf of such companies or clients for which it received or may receive compensation. In the ordinary course of trading and brokerage activities, Haywood, the associates and affiliates thereof and the officers, directors and employees of any of them at any time may hold long or short positions, may trade or otherwise effect transactions, for their own account, for managed accounts or for the accounts of customers, in debt or equity securities of Choom and Phivida, or related assets or derivative securities. As an investment dealer, Haywood conducts research on securities and may, in the ordinary course of its business, provide research reports and investment advice to its clients on investment matters, including with respect to Choom or Phivida, or with respect to the Transaction.

Credentials of Haywood

Haywood is one of Canada's leading independent investment dealers with operations in corporate finance, equity sales and trading and investment research. Haywood is a participating organization of the Toronto Stock Exchange and the TSX Venture Exchange and a member of the Investment Industry Regulatory Organization of Canada (“ IIROC ”) and the Canadian Investor Protection Fund. The opinion expressed herein is the opinion of Haywood, and the individuals primarily responsible for preparing this Fairness Opinion are professionals of Haywood experienced in merger, acquisition, divestiture and fairness opinion

==> picture [65 x 34] intentionally omitted <==

F-4

matters and have an understanding of the marketable securities involved in the Transaction. Fairness opinions prepared by Haywood, including this Fairness Opinion, are subject to internal oversight and review before they are issued.

Scope of Review and Approach to Analysis

In connection with rendering this Fairness Opinion, Haywood has reviewed and relied upon, or carried out, among other things, the following:

(a) the Arrangement Agreement dated June 2, 2020;
(b) the disclosure letters for each of Phivida and Choom dated June 2, 2020;
(c) the Phivida Support and Voting Agreements;
(d) the audited financial statements of each of Choom and Phivida for their respective fiscal years ended June 30, 2019 and September 30, 2019;
(e) management’s discussion and analysis of financial condition for each of Choom and Phivida for their respective fiscal years ended June 30, 2019 and September 30, 2019;
(f) financial forecasts for each of Choom and Phivida and subsequent discussions with management of Phivida regarding these projections;
(g) public information relating to the business, financial condition and trading history of Phivida and other select public companies Haywood considered relevant;
(h) certain historical financial information and operating data concerning Choom and Phivida;
(i) certain projected financial information, including without limitation, budgets, financial forecasts and internal operational models, which were prepared and provided by Choom, Phivida and their advisors;
(j) certain internal documents, including without limitation, internal management forecasts, operating agreements, management reports and management presentations, which were prepared and provided by Choom and Phivida;
(k) the financial results of Choom and Phivida and compared them with publicly available financial data concerning certain publicly traded companies that Haywood deemed to be relevant for the purposes of its analysis (sources: Bloomberg, Capital IQ);
(l) publicly available financial data for merger and acquisition transactions that Haywood deemed comparable for the purposes of its analysis (sources: publicly available company filings, Bloomberg, Capital IQ);
(m) where applicable, compared the consideration to be paid by Choom to the value per common share of Phivida implied by analyses of market multiples of comparable companies;
(n) certain industry and analyst reports and statistics that Haywood deemed relevant for the purposes of its analysis;

==> picture [65 x 32] intentionally omitted <==

F-5

(o) certain other internal information prepared for and by Choom and Phivida;
(p) meetings with Phivida’s management to understand relevant aspects of the business and how the outlook for the near and mid future will impact Phivida;
(q) a certificate addressed to Haywood, dated June 2, 2020, from two senior officers of Phivida as to the completeness and accuracy of the Information (as defined below);
(r) publicly available technical reports and financial documents on relevant comparable companies in the sector (source: company filings); and
(s) considered such other financial, market, technical and industry information, and conducted such other investigations, analyses and discussions (including discussions with senior management of Choom and Phivida) as Haywood considered relevant and appropriate in the circumstances.

In its assessment, Haywood considered several techniques which involved a number of quantitative and qualitative factors, and used a blended approach to determine its opinion on the Transaction.

Haywood has not, to the best of its knowledge, been denied access by Phivida to any information under its control requested by Haywood. Haywood did not meet with the auditors of Choom or Phivida, and has assumed the accuracy and fair presentation of and relied upon the audited financial statements of each of Phivida and Choom and the reports of the auditor thereon.

Assumptions and Limitations

With the approval and agreement of the Special Committee and the Board and as provided for in the Engagement Agreement, and subject to the exercise of its professional judgement, Haywood has relied upon and assumed the completeness, accuracy and fair presentation of all financial information, business plans, financial analyses, forecasts and other information, data, advice, opinions and representations (collectively referred to as the “ Information ”) obtained by Haywood from public sources, or provided to Haywood by Choom and Phivida, their respective subsidiaries, directors, officers, associates, affiliates, consultants, advisors and representatives relating to Choom, Phivida, their respective subsidiaries, associates and affiliates, and to the Transaction. This Fairness Opinion is conditional upon such completeness, accuracy and fair presentation of the Information. Haywood has not been requested to or, subject to the exercise of professional judgment, attempted to verify independently the completeness, accuracy or fair presentation of any such Information and assumes no responsibility or liability in connection therewith. Haywood has not conducted or been provided with any valuation or appraisal of any assets or liabilities, nor has it evaluated the solvency of Choom or Phivida under any provincial or federal laws relating to bankruptcy, insolvency or similar matters. In addition, Haywood has not assumed any obligation to conduct any physical inspection of the properties or the facilities of Choom or Phivida. Haywood has not had the benefit of reviewing any third party economic assessment on the assets of Choom or Phivida, and expresses no opinion as to the results of any future economic assessment that may be released prior to or following completion of the Transaction or the market reaction to the results of such economic assessment. The technical due diligence conducted by Haywood was limited in scope and Haywood has relied heavily on the experience and representations of management of Phivida.

Phivida has represented to Haywood in a certificate of two senior officers dated June 2, 2020, among other things, that the Information provided to Haywood, including the written information and discussions concerning Phivida referred to above under the heading “Scope of Review and Approach to Analysis”, is complete and correct at the date the Information was provided to Haywood and that, since the date on which

==> picture [65 x 34] intentionally omitted <==

F-6

the Information was provided to Haywood, there has been no material change, financial or otherwise, in the financial condition, assets, liabilities (contingent or otherwise), business, operations or prospects of Phivida or any of its affiliates and no material change has occurred in the Information or any part thereof which would have or which would reasonably be expected to have a material effect on this Fairness Opinion. Haywood has relied on the representations and warranties of Choom as set out in the Agreement as well as a disclosure letter provided by each of Phivida and Choom in accordance with the terms of the Agreement and assumes that such representations and warranties are complete and correct at the date of this Fairness Opinion and that there has been no material change, financial or otherwise, in the financial condition, assets, liabilities (contingent or otherwise), business, operations or prospects of Choom or its affiliates which would have or which would reasonably be expected to have a material effect on this Fairness Opinion.

With respect to any financial analyses, forecasts, projections, estimates and/or budgets provided to Haywood and used in its analyses, Haywood notes that projecting future results of any company is inherently subject to uncertainty. Haywood has assumed, however, that such financial analyses, forecasts, projections, estimates and/or budgets were prepared using the assumptions identified therein and that such assumptions reflect the best currently available estimates and judgments by management as to the expected future results of operations and financial condition of each of Choom and Phivida. Haywood expresses no view as to such financial analyses, forecasts, projections, estimates and/or budgets or the assumptions on which they were based.

In preparing this Fairness Opinion, Haywood has made several assumptions, including that all of the representations and warranties contained in the Agreement are correct as of the date hereof, all of the conditions required to complete the Transaction will be met, the Transaction will be completed substantially in accordance with its terms and all applicable laws, and that the disclosure provided in the Circular with respect to Choom, Phivida, and their respective subsidiaries and affiliates and the Transaction will be accurate in all material respects.

Haywood has relied as to all legal matters relevant to rendering this Fairness Opinion upon the advice of its own counsel. Haywood has further assumed that all material governmental, regulatory or other consents and approvals necessary for the consummation of the Transaction will be obtained without any adverse effect on Choom or Phivida or on the contemplated benefits of the Transaction.

Haywood is not a legal, tax or accounting expert and expresses no opinion concerning any legal, tax or accounting matters concerning the Transaction or the sufficiency of this letter for your purposes.

This Fairness Opinion is rendered as at the date hereof and on the basis of securities markets, economic and general business and financial conditions prevailing, and the Information as at June 2, 2020 and the conditions and prospects, financial and otherwise, of Choom or Phivida as they are reflected in the Information provided by Choom and Phivida, and as was represented to Haywood in its discussions with the management of Choom, the management of Phivida, and certain of their respective consultants, advisors and representatives. It should be understood that subsequent developments may affect this Fairness Opinion and that Haywood does not have any obligation to update, revise or reaffirm this Fairness Opinion. Haywood is expressing no opinion herein as to the price at which the Choom Shares or the Phivida Shares will trade at any future time. In Haywood’s analyses and in connection with the preparation of this Fairness Opinion, Haywood made numerous assumptions with respect to industry performance, general business, market and economic conditions and other matters, many of which are beyond the control of Haywood and any party involved in the Transaction.

Haywood has not been asked to prepare and has not prepared a valuation of Choom or Phivida or any of the securities or assets thereof and this Fairness Opinion should not be construed as a “formal valuation”

==> picture [65 x 34] intentionally omitted <==

F-7

(within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ).

This Fairness Opinion is provided for the use of the Special Committee and the Board only and may not be disclosed, referred or communicated to, or relied upon by, any third party without Haywood’s prior written approval. Haywood consents to the inclusion of this Fairness Opinion in the Circular. Haywood disclaims any undertaking or obligation to advise any person of any change in any fact or matter affecting this Fairness Opinion that may come or be brought to the attention of Haywood after the date hereof. Without limiting the foregoing, in the event that there is any material change in any fact or matter affecting this Fairness Opinion after the date hereof, Haywood reserves the right to change, modify or withdraw this Fairness Opinion.

Haywood believes that its analyses must be considered as a whole and that selecting portions of the analyses or the factors considered by it, without considering all factors and analyses together, could create a misleading view of the process underlying this Fairness Opinion. The preparation of an opinion is a complex process and is not necessarily amenable to partial analysis or summary description. Any attempt to do so could lead to undue emphasis on any particular factor or analysis.

This Fairness Opinion has been prepared in accordance with the Disclosure Standards for Formal Valuations and Fairness Opinions of IIROC, but IIROC has not been involved in the preparation or review of this Fairness Opinion.

Fairness Conclusion

Based on and subject to the foregoing and such other factors as Haywood considered relevant, Haywood is of the opinion that, as of the date hereof, the Consideration is fair, from a financial point of view, to the Phivida Shareholders.

Yours truly,

Campbell Becher, Managing Director

HAYWOOD SECURITIES INC.

==> picture [65 x 32] intentionally omitted <==

G-1

APPENDIX “G”

ADDITIONAL INFORMATION CONCERNING PHIVIDA

GLOSSARY OF TERMS

Unless the context indicates otherwise, capitalized terms which are used in this Appendix “G” and are not otherwise defined herein have the meanings given to such terms under the heading “ Glossary of Terms ” in this Circular.

DOCUMENTS INCORPORATED BY REFERENCE

Information has been incorporated by reference in this Appendix “G” from documents filed by Phivida with securities commissions or similar authorities in Canada. Copies of the documents incorporated herein by reference may be obtained on request, without charge, from Phivida at 422 Richards St., Suite 170, Vancouver, British Columbia, V6B 2Z4. In addition, copies of the documents incorporated by reference may be obtained through Phivida’s SEDAR profile at www.sedar.com.

The following documents of Phivida are specifically incorporated by reference in this Circular:

(a) the audited consolidated financial statements of Phivida for the year ended September 30, 2018, together with the notes thereto;
(b) management’s discussion and analysis of the financial condition and results of operations of Phivida for the year ended September 30, 2018;
(c) the audited consolidated financial statements of Phivida for the years ended September 30, 2019, together with the notes thereto;
(d) management’s discussion and analysis of the financial condition and results of operations of Phivida for the year ended September 30, 2019;
(e) the unaudited condensed interim consolidated financial statements of Phivida for the three and six months ended March 31, 2020, together with the notes thereto;
(f) management’s discussion and analysis of the financial condition and results of operations of Phivida for the three and six months ended March 31, 2020;
(g) the material change report of Phivida dated June 4, 2020 in respect of the Arrangement;
(h) the material change report of Phivida dated November 29, 2019 in respect of the leadership transition of the Phivida Board and management;
(i) the business acquisition report of Phivida dated August 12, 2019 in respect of the acquisition of Wikala.com Inc. and related subsidiaries;
(j) the material change report of Phivida dated June 7, 2019 in respect of the completion of the acquisition of Wikala.com Inc. and related subsidiaries;

G-2

(k) the material change report of Phivida dated August 24, 2018 in respect of the joint venture between Phivida and WeedMD Inc., to develop and operate Cannabis Beverages Inc.

Any documents of the type required by National Instrument 44-101 – Short Form Prospectus Distributions to be incorporated by reference in a short form prospectus, including any annual information form, annual financial statements and the auditors’ report thereon, interim financial statements, management’s discussion and analysis of financial conditions and results of operations, material change reports (excluding a confidential material change report), business acquisition report and information circular, filed by Phivida after the date of this Circular and before the Phivida Meeting are deemed to be incorporated by reference in this Circular.

Any statement contained in this Appendix “G” or in a document incorporated or deemed to be incorporated by reference herein will be deemed to be modified or superseded for purposes of this Appendix “G” to the extent that a statement contained in this Appendix “G” or in any other subsequently filed document which also is, or is deemed to be, incorporated by reference into this Appendix “G” modifies or supersedes that statement. The modifying or superseding statement need not state that it has modified or superseded a prior statement or include any other information set forth in the document that it modifies or supersedes. The making of a modifying or superseding statement shall not be deemed an admission for any purposes that the modified or superseded statement, when made, constituted a misrepresentation, an untrue statement of material fact or an omission to state a material fact that is required to be stated or that is necessary to make a statement not misleading in light of the circumstances in which it was made. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute part of this Appendix “G”.

PHIVIDA

Name, Address and Incorporation

Phivida was incorporated under the BCBCA on April 24, 2015 as “Icarus Capital Corp.”. Phivida subsequently changed its name on November 18, 2015 to “Phytofarms Holdings Inc.” and, on January 16, 2017, changed its name again to its present name of “Phivida Holdings Inc.”. Phivida’s head and registered office is located at 422 Richards St., Suite 170, Vancouver, British Columbia, V6B 2Z4.

Intercorporate Relationships

Phivida’s material Subsidiaries are Phivida Organics Inc. (existing under the laws of Delaware, United States) and Wikala.com Inc. (existing under the laws of the Business Corporations Act (Canada), which are both wholly-owned direct Subsidiaries of Phivida. Wikala.com Inc., in turn, wholly owns each of Platform WD DOO (existing under the laws of Serbia) and Wikala Holdings Inc. (existing under the laws of the State of Delware, USA). Phivida also owns a 50% interest in CanBev (as defined below).

G-3

Description of the Business

Phivida is a Canadian-based corporation operating in the US functional food and natural health products market with a focus on custom formulated hemp oil extracts and hemp oil-infused beverages and nutraceuticals. Phivida is selling hemp oil-infused beverages and nutraceuticals into retail markets across the US under the “Oki” and “Vida+” brand names.

Phivida’s products are aimed at the mass consumer preventative health and wellness markets, the professional alternative healthcare markets and clinician markets. Management believes the emergence of phytocannabinoid-based functional foods and natural health products will have a significant impact on the global pain management market and represents a significant commercial opportunity.

Through its Subsidiaries, Phivida operates an online cannabis and hemp news site (www.greencamp.com), an online marketplace for the sale of smoke devices and accessories (www.bloomgroove.com) and a CBD marketplace (www.wikala.com).

Products and Services

Phivida produces premium specialty functional natural health products made with hemp extracts. Naturally-occurring cannabinoids found in hemp (such as cannabidiol and other non-psychotropic cannabinoids and terpenes) are phytochemicals widely studied to be therapeutic for their antiinflammatory and anti-oxidant properties. Cannabinoid-rich hemp oils are sought after for a range of consumer product categories, such as pharmaceuticals, nutraceuticals, supplements, functional foods and beverages, topical ointments, and cosmetics, as alternatives for e-juice and vape pen products, and pet and animal supplements, among others.

Phivida has two product line: Oki and Vida+. The Oki brand is a line of premium beverages infused with active hemp extract. Oki beverages are infused with 20 mg of active hemp extract per bottle and come in two different formulations: iced teas and flavor-infused water, with each 16oz product available in four different flavours. Oki supplements are available in tinctures or capsules that range in dosage from 6001800 total mg of active hemp extract. All products contain non GMO, natural and organic ingredients, are plant-based and vegan-friendly, and are packaged in sleep 100% recyclable glass containers. Phivida’s clinical brand, Vida+, consists of tinctures and capsules that are distributed to health care professionals as well as directly to consumers through Phivida’s online storefront.

Greencamp.com creates content, news and articles for the cannabis and hemp industry.

Bloomgroove.com is an online e-commerce platform for sale of smoke devices and other accessories to the end consumer. It ships across North America.

Wikala is an online CBD marketplace platform for e-commerce sales. The CBD marketplace provides consumers with a wide array of CBD products from Phivida’s line of products, in addition to third party vendors, who have an easy, accessible and responsible digital marketplace to increase their exposure and sales to CBD consumers.

Specialized Skill and Knowledge

The nature of Phivida’s business requires specialized knowledge and technical skill around cannabinoid science and the hemp industry in the United States, clinical sciences, product formulation, quality

G-4

assurance, ingredient sourcing, and marketing and distributing of functional foods, as well as skills and knowledge regarding the development and operation of Phivida’s e-commerce platform.

Competitive Conditions

Cannabinoid-infused foods and beverages is a prevailing consumer category within the US functional food and nutraceutical market. Thus existing cannabinoid infused foods are available, and are highly sought out by consumers. When sold in regulated channels, these products are in direct competition with Phivida’s products. In addition, there are a number of online retailers of vaporizers and cannabis ancillary products in the principal markets in which Phivida operates. Accordingly, competition is robust.

Intangible Properties

Phivida relies on intellectual property laws, confidentiality agreements, contractual provisions and similar measures to protect its intellectual property.

General Development of the Business

Two Year History

– October 1, 2017 September 30, 2018

On December 15, 2017, Phivida successfully completed an initial public offering of 14,375,000 units, at a price of $0.40 per unit, including the full over-allotment option for gross proceeds of $5,750,000. Each unit was comprised of one Phivida Share and one-half of one Phivida Share purchase warrant. Each whole warrant was exercisable at a price of $0.75 per Phivida Share for a period of 24 months subject to an acceleration clause. In connection with the closing of the initial public offering, Phivida paid to Mackie Research Capital Corporation and Haywood Securities Inc. a corporate finance fee of $75,000 and 187,500 Phivida Shares, and compensation warrants exercisable for 832,563 Phivida Shares at a price of $0.40 per share for a period of 24 months pursuant to the terms of an agency agreement. The Phivida Shares began trading on the CSE under the symbol “VIDA” on December 19, 2017.

On January 16, 2018, Phivida announced the global launch of Nano-CBD™ Iced Teas for gut health.

On January 17, 2018, Phivida entered into a brand licensing agreement with Dynamic Processors LLC to manufacture and distribute Phivida and Vida+ products to Washington State’s regulated cannabinoid retailers.

On February 28, 2018, Phivida announced the appointment of Mr. James Bailey as its Chief Executive Officer, commencing on March 19, 2018.

On April 19, 2018, Phivida completed a bought deal financing of 6,960,000 units, at a price of $1.15 per unit, for aggregate gross proceeds of approximately $8 million. Each unit consisted of a Phivida Share and one-half of a Phivida Share purchase warrant, with each whole warrant exercisable for a period of 24 months from the date of issuance with an exercise price of $1.60 per Phivida Share.

On June 28, 2018, the U.S. Senate officially passed the Agriculture Improvement Act of 2018 (the “ 2018 Farm Bill ”). The 2018 Farm Bill include da provision lifting the USA Industrial Hemp laws from a research

G-5

and development pilot to a full agricultural commodity status – and effectively removed hemp-derived CBD (cannabidiol), and all naturally occurring cannabinoids therein, from the controlled substance list.

On August 1, 2018, Phivida announced that it had signed an exclusive national agreement with Natural Speciality Sales (“ NSS ”), an Acosta company. The agreement resulted in Phivida’s Oki brand of premium CBD products becoming the exclusive CBD infused beverage brand and health supplements products represented by NSS.

On August 15, 2018, Phivida announced it had signed a definitive joint venture agreement with WeedMD Inc. (“ WeedMD ”) to develop and operate Cannabis Beverages Inc. (“ CanBev ”) at WeedMD’s state-of-theart greenhouse facility in Strathroy, Ontario. Under the terms of the agreement, the joint venture is to be structured as a jointly-owned company with a dedicated board of directors and operational management team. Phivida and WeedMD agreed to retain 50% each of the class A shares of CanBev. The board of directors of CanBev were to be made up of five individuals, two nominated by Phivida, two by WeedMD and one independent director. Phivida and WeedMD agreed to fund capital requirements of CanBev equally, on a pro-rata basis, from their respective treasuries, beginning with initial shareholder advances of $375,000 each. CanBev had planned to manufacture, market and distribute cannabinoid infused products for use initially into the medical market as well as for the recreational Canadian markets, and then for use internationally, where such products are permitted. To date, no material activities have taken place with respect to CanBev.

– October 1, 2018 September 30, 2019

On September 12, 2018, Phivida launched its “Oki” brand of functional beverages and supplements infused with Active Hemp Extract.

On March 14, 2019, Phivida announced that leading supermarket chain Safeway, will begin selling Oki beverages in over 100 stores located across Colorado.

On March 20, 2019, Phivida announced that it had entered into a strategic partnership with Green Glass Global, a leading beverage brokerage firm specializing in on-premise national accounts for the specialty drinks sector. The partnership was to focus on placing Phivida’s Oki beverages in premium hospitality outlets across the United States.

Phivida entered into a partnership on April 5, 2019 with Scout Distribution, an innovative beverage distributor based in San Diego, California. Scout Distribution was to be the official distributor of Oki beverages in the San Diego area.

On April 26, 2019, Phivida launched its online store feeloki.com to sell Phivida’s Oki brand of premium beverages and supplements infused with active hemp extract to consumers in the United States.

On April 30, 2019, Phivida announced it had entered into a definitive agreement to acquire Wikala.com Inc., a Canadian technology firm with a leading online platform for cannabis information (the “ Wikala Acquisition ”). The Wikala Acquisition was structured as an all-share transaction, with Wikala.com Inc. shareholders receiving 0.7639 of a Phivida Share for each Wikala.com Inc. share held, and resulting in the issuance of 26,325,004 Phivida Shares. The Wikala Acquisition was completed on May 29, 2019 and, as part of the completion of the Wikala Transaction, David Moon (the founder and Chief Executive Officer of Wikala.com Inc.) joined the Phivida Board.

G-6

On September 3, 2019, Phivida announced that its e-commerce site Bloomgroove.com, which offers a full range of cannabis accessories, had become available to customers across North America.

Recent Developments

On October 28, 2019, Phivida announced that it had signed an agreement with Gotham Brands to handle sales, merchandising and distribution in New York City of Phivida’s line of Oki beverages.

On November 13, 2019, Phivida announced that it had signed an agreement with an independent distributor to handle sales, merchandising and distribution in Florida for its line of Oki beverages.

On November 25, 2019, Phivida announced a leadership transition following the decision of James Bailey to step down as President and CEO and as a director. David Moon was appointed as Interim Chief Executive Officer. Phivida also commenced a strategic review process to consider all value-maximizing opportunities, including exploring potential corporate transactions.

On December 2, 2019, Phivida announced that Wikala.com, an online CBD marketplace for U.S. vendors, had gone live, and that Phivida’s full line of Oki and Vida+ products can be purchased on the Wikala site as well as select CBD products sold by third parties.

On June 3, 2020 Phivida announced that it had entered into the Arrangement Agreement with Choom in respect of the Arrangement.

CAPITAL STRUCTURE

The authorized capital of Phivida consists of an unlimited number of Phivida Shares. Holders of Phivida Shares are entitled to vote at all meetings of Phivida Shareholders and, subject to the rights of holders of any shares ranking in priority to or on a parity with the Phivida Shares, to participate rateably in any distribution of Phivida’s property or assets upon liquidation or winding-up.

PRIOR SALES

Prior Sales

In the 12 month period prior to the date of this Circular, Phivida issued the following securities:

Description of Security	Date Issued	Number of Securities Issued	Issuance/Exercise Price per Security
Phivida Shares	December 18, 2019	400,000	$0.175

G-7

Trading Price and Volume

The Phivida Shares are listed on the CSE under the symbol “VIDA”. The following sets forth trading information for the Phivida Shares as reported by the CSE for the periods indicated:

Period	Price	Range	Trading Volume
	High	Low
August (1-4)	$0.07	$0.06	545
July 2020	$0.08	$0.06	1,121,000
June 2020	$0.12	$0.07	2,501,627
May 2020	$0.10	$0.06	2,190,183
April 2020	$0.09	$0.06	1,218,299
March 2020	$0.10	$0.04	1,864,476
February 2020	$0.12	$0.08	1,433,323
January 2020	$0.16	$0.09	2,775,090
December 2019	$0.15	$0.08	2,777,874
November 2019	$0.21	$0.12	2,491,659
October 2019	$0.26	$0.15	3,091,259
September 2019	$0.31	$0.19	1,508,807
August 2019	$0.44	$0.29	1,403,450
July 2019	$0.45	$0.31	1,945,344

The closing price of the Phivida Shares on June 2, 2020, being the last trading day prior to the announcement of the Arrangement Agreement, was $0.085 per Phivida Share. The closing price of the Phivida Shares on the CSE on August 4, 2020, being the last trading day on which the Phivida Shares traded prior to the date of this Circular, was $0.06 per Phivida Share.

ESCROWED SECURITIES AND SECURITIES SUBJECT TO CONTRACTUAL RESTRICTIONS ON TRANSFER

As at the date hereof, other than with respect to the Support and Voting Agreements executed by the Supporting Shareholders, none of Phivida’s securities are subject to escrow or contractual restrictions on transfer.

DIVIDENDS OR DISTRIBUTIONS

No dividends have ever been paid on any shares of Phivida. Phivida intends to retain its earnings to finance its growth and development of its business, and therefore it is not expected that dividends will be paid on the Phivida Shares in the immediate or foreseeable future. The Phivida Board will determine the actual timing, payment and amount of dividends, if any, that may be paid by Phivida from time to time based upon, among other things, the level of cash flow, results of operations and financial condition, the need for funds to finance ongoing operations and other business considerations as the Phivida Board considers relevant.

G-8

CONSOLIDATED CAPITALIZATION

The share and loan capital of Phivida are disclosed in the unaudited condensed interim financial statements of Phivida as at and for the three months ended March 31, 2020, together with the notes thereto, which are incorporated by reference herein. There have been no material changes in the share and loan capital of Phivida since the date of such interim financial statements.

DIRECTORS AND OFFICERS

Name, Occupation and Security Holding

The following table and notes thereto sets forth, as at the date hereof, the name of each director and executive officer of Phivida, the province and country in which he or she is ordinarily resident, all offices of Phivida now held by such person, their respective principal occupations during the prior five preceding years, the time period for which he/she has been a director of Phivida and the number of Phivida Shares beneficially owned by him or her, directly or indirectly, or over which he or she exercises control or direction, as at the date hereof.

Name, Title, and Province and Country of Residence	Principal Occupation for 5 preceding years	Date First Became a Director	Number of Phivida Shares Held
Peter Simeon Chairman of the Board and Director Ontario, Canada	Partner at Gowling WLG (Canada) LLP since 2015; Partner at Wildeboer Dellelce LLP from 2008 to 2015.	May 5, 2017	125,000
David Moon Director and Interim CEO Ontario, Canada	Interim Chief Executive Officer of Phivida since November 2019, President of Wikala.com Inc. since 2017; President of Investintech.com Inc. since 2000.	May 28, 2019	3,816,050
John Di Girolamo Director Ontario, Canada	President and Director of Starling Brands Inc. since 2017; Managing Partner of Liberty North Capital Corp. since 2013.	October 28, 2019	3,625,277
Carmelo Marrelli Chief Financial Officer Ontario, Canada	Principal of The Marrelli Group of Companies, providing various corporate secretarial, financial and accounting services to public and private companies	N/A	150,000

G-9

Name, Title, and Province and Country of Residence	Principal Occupation for 5 preceding years	Date First Became a Director	Number of Phivida Shares Held
George Kovalyov Vice President – Finance British Columbia, Canada	Vice-President, Finance of Phivida	N/A	472,750
Mike Cornwell Chief Marketing Officer British Columbia, Canada	Chief Marketing Officer of Phivida; Former Chief Marketing Officer at Samsung NZ, Microsoft NZ, Former Director of Sales & Marketing at Red Bull Canada	N/A	Nil

Cease Trade Orders, Bankruptcies, Penalties or Sanctions

To the knowledge of Phivida, no director or officer:

(a) is, at the date of this Circular, or has been, within 10 years before the date of this Circular, a director, chief executive officer (“ CEO ”) or chief financial officer (“ CFO ”) of any company (including Phivida) that:
(i) was subject, to a cease trade or similar order or an order that denied the relevant company access to any exemptions under securities legislation, that was in effect for a period of more than 30 consecutive days (collectively, an “ Order ”); when such Order was issued while the person was acting in the capacity of a director, CEO or CFO of the relevant company; or
(ii) was subject to an Order for that was issued after such person ceased to be a director, CEO or CFO of the relevant company, and which resulted from an event that occurred while that person was acting in the capacity as director, CEO or CFO of the relevant company; or
(b) is, as at the date of this Circular, or has been within 10 years before the date of the Circular, a director or executive officer of any company (including Phivida) 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
(c) has, within the 10 years before the date of this Circular, 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; or

G-10

(d) has been subject to 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
(e) has been subject to any penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable securityholder in deciding whether to vote for a proposed director.

EXECUTIVE COMPENSATION

Under applicable securities legislation, Phivida is required to disclose certain financial and other information relating to the compensation of the Chief Executive Officer, the Chief Financial Officer and the most highly compensated executive officers of Phivida as at the date of this Circular whose total compensation was more than $150,000 for the financial year of Phivida ended September 30, 2019, other than for the Chief Executive Officer and the Chief Financial Officer (collectively, the “ Named Executive Officers ”) and for the directors of Phivida.

Summary Compensation Table

The following table (presented in accordance with Form 51-102F6V – Statement of Executive Compensation – Venture Issuers under National Instrument 51-102 – Continuous Disclosure Obligations ) sets out all direct and indirect compensation for, or in connection with, services provided to Phivida and its Subsidiaries for the two most recently completed financial years ended September 30, 2019 and 2018, in respect of the Named Executive Officers as well as the directors of the Company.

	TABLE OF COMPENSATION EXCLUDING COMPENSATION SECURITIES	TABLE OF COMPENSATION EXCLUDING COMPENSATION SECURITIES	TABLE OF COMPENSATION EXCLUDING COMPENSATION SECURITIES	TABLE OF COMPENSATION EXCLUDING COMPENSATION SECURITIES	TABLE OF COMPENSATION EXCLUDING COMPENSATION SECURITIES	TABLE OF COMPENSATION EXCLUDING COMPENSATION SECURITIES
Name and Position	Year	Salary, Consulting Fee, Retainer or Commission	Bonus	Committee or Meeting Fees	Value of Perquisites	Value of all Other Compensation	Total Compensation
James Bailey(1) Former President, Chief Executive Officer and Director David Moon(2) Interim Chief Executive Officer and Director Carmelo Marrelli (3) Chief Financial Officer Douglas Campbell(4) Former Chief Commercial Officer	2019 2018 2019 2018 2019 2018 2019 2018	$300,000 $158,657 $58,333 Nil $61,459 $55,214 $231,000 $92,400	Nil $53,843 Nil Nil Nil Nil Nil Nil	Nil Nil Nil Nil Nil Nil Nil Nil	Nil nil Nil Nil Nil Nil Nil Nil	Nil Nil Nil Nil Nil Nil Nil Nil	$300,000 $212,500 $58,333 Nil $61,459 $55,214 $231,000 $92,400

G-11

	TABLE OF COMPENSATION EXCLUDING COMPENSATION SECURITIES	TABLE OF COMPENSATION EXCLUDING COMPENSATION SECURITIES	TABLE OF COMPENSATION EXCLUDING COMPENSATION SECURITIES	TABLE OF COMPENSATION EXCLUDING COMPENSATION SECURITIES	TABLE OF COMPENSATION EXCLUDING COMPENSATION SECURITIES	TABLE OF COMPENSATION EXCLUDING COMPENSATION SECURITIES
Name and Position	Year	Salary, Consulting Fee, Retainer or Commission	Bonus	Committee or Meeting Fees	Value of Perquisites	Value of all Other Compensation	Total Compensation
George Kovalyov (5) Vice President, Finance; Former Director Peter Simeon(6) Chairman and Director William Ciprick(7) Former Director Vito Piazza(8) Former Director John Caruso(9) Former Director	2019 2018 2019 2018 2019 2018 2019 2018 2019 2018	$175,000 $72,729 $225,090 $380,002 Nil Nil Nil Nil Nil Nil	Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil	Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil	Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil	Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil	$175,000 $72,729 $225,090 $380,002 Nil Nil Nil Nil Nil Nil

Notes:

(1) Mr. Bailey resigned as President and Chief Executive Officer of Phivida and from the Phivida Board on November 25, 2019. All compensation described is attributable to Mr. Bailey’s role as President and Chief Executive Officer.
(2) Mr. Moon was appointed to the Phivida Board on May 29, 2019 and was appointed Interim Chief Executive Officer on November 25, 2019. Mr. Moon served approximately four months as a member of the Phivida Board in the most recent financial year. All compensation described is attributable to Mr. Moon’s role as Interim Chief Executive Officer.
(3) Certain compensation was paid to DSA Corporate Services Inc. and DSA Filing Services Limited, companies controlled by Mr. Marrelli that were engaged by Phivida to provide corporate secretary and filing services.
(4) Mr. Campbell was appointed as Chief Commercial Officer of Phivida on April 13, 2018. Mr. Campbell’s management agreement was terminated on January 14, 2020.
(5) Mr. Kovalyov resigned from the Phivida Board on July 6, 2018.
(6) Mr. Simeon was appointed as Chairman of the Phivida Board on July 6, 2018.
(7) Mr. Ciprick resigned from the Phivida Board on August 23, 2019.
(8) Mr. Piazza resigned from the Phivida Board on October 12, 2019.
(9) Mr. Caruso resigned from the Phivida Board on October 29, 2019.

G-12

Stock Options and Other Compensation Securities

The following table discloses all compensation securities granted or issued to each director and Named Executive Officer of Phivida for the most recently completed financial year (ended September 30, 2019).

		COMPENSATION SECURITIES	COMPENSATION SECURITIES	COMPENSATION SECURITIES
Name and Position	Number of Compensation Securities, Number of Underlying Securities and Percentage of Class (1)	Date of Issue or Grant	Issue, Conversion or Exercise Price	Closing Price of Security or Underlying Security on Date of Grant	Closing Price of Security or Underlying Security at Year End	Expiry Date
David Moon(2) Interim Chief Executive Officer and Director John Caruso (5) Former Director	242,310 Phivida Options(3) 1,000,000 Phivida Options(4) 200,000 Phivida Options	May 28, 2019 May 29, 2019 December 20, 2018	$0.09 $0.56 $0.60	$0.09 $0.56 $0.60	$0.21 $0.21 $0.21	January 26, 2023 May 28, 2024 December 20, 2023

Notes:

(1) Percentage of class is calculated on a partially diluted basis assuming: (i) the exercise of Phivida Options granted to directors and Named Executive Officers of Phivida as at September 30, 2019; and (ii) an aggregate of 88,633,717 Phivida Shares outstanding as at September 30, 2019.
(2) As at September 30, 2019, Mr. Moon had ownership, direction or control over a total of 1,242,310 Phivida Options exercisable for 1,242,310 Phivida Shares, representing 11% of the total Phivida Options outstanding.
(3) The Phivida Options granted to Mr. Moon on May 28, 2019 will vest in three equal amounts on November 28, 2019, May 28, 2020 and November 28, 2020.
(4) The Phivida Options granted to Mr. Moon on May 29, 2019 will vest in three equal amounts on November 28, 2019, May 28, 2020 and November 28, 2020.
(5) The Phivida Options granted to Mr. Caruso represent 2% of the total Phivida Options outstanding and expired following his resignation from the Phivida Board on October 29, 2019.

Phivida Option Plan

The Phivida Options Plan is a “rolling” stock option plan, which was approved by Phivida Shareholders on March 21, 2019. The Phivida Option Plan is designed for Phivida’s selected employees, officers, directors, consultants and contractors, to incentivize such individuals to contribute toward Phivida’s long-term goals, and to encourage such individuals to acquire Phivida Shares as long-term investments.

The number of Phivida Shares reserved for issue under the Phivida Option Plan may not exceed 15% of the issued and outstanding Phivida Shares from time to time. The Phivida Options granted under the Phivida Option Plan are non-assignable and may be granted for a term not exceeding five years as long as the optionee remains an eligible optionee pursuant to the Phivida Option Plan or within 90 days (or as otherwise determined by the Phivida Board) after ceasing to be an eligible optionee, or, if the optionee dies, within one year from the date of the optionee’s death. Phivida Options may be granted under the Phivida Option Plan only to directors, officers, employees and other service providers, subject to the rules

G-13

and regulations of applicable regulatory authorities and any Canadian stock exchange upon which the Phivida Shares may be listed or may trade from time to time.

The exercise price of any Phivida Option, when exercised, may not be less than the greater of the closing market price of the Phivida Shares on: (a) the last trading day immediately preceding the date of grant of the Phivida Option; and (b) the date of grant of the Phivida Option; provided, however, that if the Phivida Shares are not listed on any securities exchange, the exercise price may not be less than the fair market value of the Phivida Shares as may be determined by the Phivida Board on the day immediately preceding the date of the grant of the Phivida Option.

The Phivida Option Plan contains the following restrictions as to insider and individual eligibility thereunder: (i) the maximum number of Phivida Shares which may be reserved for issuance to insiders under the Phivida Option Plan, any other employer stock option plans or options for services, shall be 15% of the Phivida Shares issued and outstanding at the time of grant (on a non-diluted basis); (ii) the maximum number of Phivida Options which may be granted to insiders under the Phivida Option Plan, any other employer stock option plans or options for services, within any 12 month period, shall be 10% of the Phivida Shares issued and outstanding at the time of the grant (on a non-diluted basis); and (iii) the maximum number of Phivida Shares which may be issued to any one optionee, together with any other previously established or proposed share compensation arrangements, within a one year period, shall be 5% of the Phivida Shares outstanding at the time of the grant (on a non-diluted basis). The maximum number of Phivida Options which may be granted to any one consultant under the Phivida Option Plan, any other employer stock option plans or options for services, within any 12 month period, must not exceed 2% of the Phivida Shares issued and outstanding at the time of the grant (on a non-diluted basis). The maximum number of Phivida Options which may be granted to “investor relations persons” under the Phivida Option Plan, any other employer stock option plans or options for services, within any 12 month period, must not exceed, in the aggregate, 2% of the Phivida Shares issued and outstanding at the time of the grant (on a non-diluted basis).

Employment, Consulting and Management Agreements

Below is a description of the material terms of each agreement or arrangement under which compensation was provided during the most recently completed financial year or is payable in respect of employment, consulting or management services provided to Phivida or any of its Subsidiaries that were performed by a director or Named Executive Officer (as at September 30, 2019).

David Moon

On May 28, 2019, Phivida entered into an employment agreement with David Moon, Phivida’s current Interim Chief Executive Officer and director. Pursuant to the agreement, Mr. Moon provides all services to fulfill the duties and responsibilities as outlined in the agreement in exchange for consideration of $14,583 per month and Phivida Options to purchase an aggregate total of 1,000,000 Phivida Shares. The Phivida Options expire five years from the date of grant and vest every six months over a period of 18 months. Once vested, each Phivida Option is exercisable to purchase one Phivida Share at a price of $0.56 per Phivida Share.

Carmello Marrelli

On April 1, 2017, Phivida entered into a consulting agreement with Carmelo Marrelli, Phivida’s Chief Financial Officer, and Marrelli Support Services Inc., a company controlled by Mr. Marrelli. Pursuant to

G-14

the agreement, Marrelli Support Services Inc. shall provide all accounting services, and Mr. Marrelli shall provide the services of Chief Financial Officer, including the preparation of all financial statements and management’s discussion and analysis, in exchange for compensation of $2,500 per month, payable in cash.

George Kovalyov

On May 28, 2018, Phivida entered into an employment agreement with Mr. Kovalyov to serve as Vice President, Finance in exchange for consideration of $12,500 per month and Phivida Options to purchase an aggregate total of 500,000 Phivida Shares. The options expire five years from the date of grant and vest over a period of 18 months, on a quarterly basis beginning three months after the date of grant. Once vested, each Phivida Option is exercisable to purchase one Phivida Share at a price of $0.88 per Phivida Share.

Peter Simeon

On January 23, 2017, Phivida entered into a director agreement with Peter Simeon to serve as a director. Pursuant to the agreement, once Mr. Simeon was appointed as a director on May 5, 2017, he became obligated to provide director services in exchange for 200,000 Phivida Options. The options expire five years from the date of grant, and vest over a one year period, on a quarterly basis beginning three months after the date of grant. Once vested, each Phivida Option is exercisable to purchase one Phivida Share at a price of $0.20 per Phivida Share.

Mr. Simeon was appointed as Chairman of the Phivida Board on July 6, 2018 in exchange for 250,000 Phivida Options. The options expire five years from the date of grant, and vest over a period of 18 months from the date of grant. The options vest every six months beginning six months after the date of grant. Once vested, each Phivida Option is exercisable to purchase one Phivida Share at a price of $0.75 per Phivida Share.

William Ciprick

On February 8, 2017, Phivida entered into a director agreement with William Ciprick to serve as a director. Pursuant to the agreement, once Mr. Ciprick was appointed as a director on May 5, 2017, he became obligated to provide director services in exchange for 200,000 Phivida Options. The options expire five years from the date of grant, and vest over a one year period, on a quarterly basis beginning three months after the date of grant. Once vested, each option is exercisable to purchase one Phivida Share at a price of $0.20 per Phivida Share. Mr. Ciprick resigned from the Phivida Board on August 23, 2019.

Mr. Ciprick resigned from the Phivida Board on August 23, 2019.

Vito Piazza

On July 6, 2018, Phivida entered into a director agreement with Vito Piazza to serve as a director. Pursuant to the agreement, once Mr. Piazza was appointed as a director on July 6, 2018, he became obligated to provide director services in exchange for 200,000 Phivida Options. The options expire five years from the date of grant, and vest over a period of 18 months. The options vest every six months beginning six months after the date of grant. Once vested, each Phivida Option is exercisable to purchase one Phivida Share at a price of $0.75 per Phivida Share. Mr. Piazza resigned from the Board on October 12, 2019.

G-15

Mr. Piazza resigned from the Phivida Board on October 12, 2019.

James Bailey

On February 9, 2017 Phivida entered into a director agreement with James Bailey. Pursuant to the agreement, Mr. Bailey was obligated to provide director services to Phivida in exchange for 200,000 Phivida Options. The options, once granted, expire five years from the date of grant, or earlier in accordance with the Phivida Option Plan. The Phivida Options are subject to a vesting schedule whereby 25% of the options vest three months from the date of grant, 25% vest six months from the date of grant, 25% vest nine months from the date of grant and the remainder vest 12 months after the date of the grant. Once vested, each Phivida Option may be exercised to purchase one share for $0.20 per Phivida Share.

On February 19, 2018, Phivida entered into an employment agreement with James Bailey to serve as Chief Executive Officer in exchange for consideration of $25,000 per month, a signing bonus of $50,000 and Phivida Options to purchase an aggregate total of 1,000,000 Phivida Shares. The options expire five years from the date of grant and vest over a one year period, on a quarterly basis beginning three months after the date of grant. Once vested, each Phivida Option is exercisable to purchase one Phivida Share at a price of $1.17 per Phivida Share.

Mr. Bailey resigned as Chief Executive Officer and Director of Phivida on November 22, 2019.

Douglas Campbell

On April 13, 2018, Phivida entered into an employment agreement with Douglas Campbell to serve as Chief Commercial Officer in exchange for consideration of USD$14,583 per month and Phivida Options to purchase an aggregate total of 500,000 Phivida Shares. The options expire five years from the date of grant and vest over a one year period, on a quarterly basis beginning three months after the date of grant. Once vested, each Phivida Option is exercisable to purchase one Phivida Share at a price of $0.92 per Phivida Share. Employment agreement with Mr. Campbell was terminated on January 14, 2020.

Mr. Campbell’s management contract was terminated on January 14, 2020.

John Caruso

On December 14, 2018, Phivida entered into a director agreement with John Caruso to serve as a director. Pursuant to the agreement, once Mr. Caruso was appointed as a director on December 14, 2018, he became obligated to provide director services in exchange for 200,000 Phivida Options. The options expire five years from the date of grant, and vest over a period of 12 months. The options vest every quarter beginning three months after the date of grant. Once vested, each stock option is exercisable to purchase one Phivida Share at a price of $0.60 per Phivida Share. Mr. Caruso resigned from the Phivida Board on October 29, 2019.

Mr. Caruso resigned from the Phivida Board on October 29, 2019.

G-16

Oversight and Description of Director and Named Executive Officer Compensation

Compensation of Named Executive Officers

Principles of Executive Compensation

Phivida believes in linking an individual’s compensation to his or her performance and contribution as well as to the performance of Phivida as a whole. The primary components of Phivida’s executive compensation are base salary and option-based awards. The Phivida Board believes that the mix between base salary and incentives must be reviewed and tailored to each executive based on their role within the organization as well as their own personal circumstances. The overall goal is to successfully link compensation to the interests of the Phivida Shareholders. The following principles form the basis of Phivida’s executive compensation program:

(1) align interests of executives and Phivida Shareholders;
(2) attract and motivate executives who are instrumental to the success of Phivida and the enhancement of Phivida Shareholder value;
(3) pay for performance;
(4) ensure compensation methods have the effect of retaining those executives whose performance has enhanced Phivida’s long-term value; and
(5) connect, if possible, Phivida’s employees into principles 1 through 4 above.

The Phivida Board is responsible for Phivida’s compensation policies and practices. The Phivida Board has the responsibility to review and make recommendations concerning the compensation of the directors of Phivida and the Named Executive Officers within the constraints of the agreements described under “ Employment, Consulting and Management Agreements ” above. The Phivida Board also has the responsibility to make recommendations concerning annual bonuses and grants to eligible persons under the Phivida Option Plan. The Phivida Board also reviews and approves the hiring of executive officers.

Base Salary

The Phivida Board approves the salary ranges for the Named Executive Officers. At the current stage of Phivida’s development, salaries have been determined by Phivida Board discussion without any formal targeted objectives. Going forward, the base salary review for each Named Executive Officer will be based on assessment of factors such as current competitive market conditions, compensation levels within a peer group and particular skills, such as leadership ability and management effectiveness, experience, responsibility and proven or expected performance of the particular individual. Comparative data for Phivida’s peer group will also be accumulated from a number of external sources including independent consultants. Phivida’s policy for determining salary for executive officers is consistent with the administration of salaries for all other employees.

Short Term Incentive Compensation

Phivida, in its discretion, may award annual bonuses in order to motivate executives to achieve short-term corporate goals. The Phivida Board approves the granting of any annual bonuses.

G-17

The success of Named Executive Officers in achieving their individual objectives and their contribution to Phivida in reaching its overall goals are factors in the determination of their annual bonus. The Phivida Board assesses each Named Executive Officer’s performance on the basis of his or her respective contribution to the achievement of the predetermined corporate objectives, as well as to needs of Phivida that arise on a day to day basis. This assessment is used by the Phivida Board in developing its recommendations with respect to the determination of annual bonuses for the Named Executive Officers.

Compensation and Measurements of Performance

Other than as disclosed in “ Employment, Consulting and Management Agreements ” above, it is the intention of the Phivida Board to approve targeted amounts of annual bonuses for each Named Executive Officer at the beginning of each financial year. The targeted amounts are based on a number of factors, including comparable compensation of similar companies.

Achieving predetermined individual and/or corporate targets and objectives, as well as general performance in day to day corporate activities, will trigger the award of a bonus payment to the Named Executive Officers. The Named Executive Officers will receive a partial or full incentive payment depending on the number of the predetermined targets met and the Phivida Board’s assessment of overall performance. The determination as to whether a target has been met is ultimately made by the Phivida Board and the Phivida Board reserves the right to make positive or negative adjustments to any bonus payment if they consider them to be appropriate.

- Long Term Incentive Compensation

The Phivida Option Plan is Phivida’s only long-term incentive compensation plan.

Compensation of Directors

Members of the Phivida Board do not receive any compensation for attending meetings of the Phivida Board, committees of the Phivida Board and meetings of Phivida Shareholders. Other than Phivida Options to purchase Phivida Shares, which are granted to Phivida’s directors from time to time, Phivida does not have any arrangements pursuant to which directors are remunerated by Phivida or any of its Subsidiaries for their services in their capacities as directors, consultants or experts.

Pension Disclosure

There are no pension plan benefits in place for the Named Executive Officers or the directors of Phivida.

G-18

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

The following table sets out information concerning the number and price of securities to be issued under equity compensation plans and others as at September 30, 2019.

Plan Category	Number of Securities to be Issued upon Exercise of Options, Warrants and Rights (a)	Weighted – Average Exercise Price of Outstanding Options, Warrants and Rights (b)	Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (excluding securities reflected in column (a))
Equity Compensation Plans Approved by Securityholders	10,861,611	$0.575	2,433,447
Equity Compensation Plans Not Approved by Securityholders	nil	nil	nil
Total	10,861,611	$0.575	2,433,447

Directors’ and Officers’ Liability Insurance

Phivida has purchased a directors’ and officers’ liability insurance policy, effective from May 28, 2020 to May 18, 2021. The policy provides $100,000 per claim and $1,000,000 for aggregate liability coverage (no excess coverage). The aggregate premium paid for the coverage was $52,500.

INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS

As at the date hereof, no director, executive officer, employee or former director, executive officer or employee of Phivida, nor any of their associates or affiliates, is indebted to Phivida nor has any such person been indebted to any other entity where such indebtedness is the subject of a guarantee, support agreement, letter of credit or similar arrangement or understanding, provided by Phivida.

MANAGEMENT CONTRACTS

Management functions of Phivida are substantially performed by the directors or executive officers of Phivida and not, to any substantial degree, by any other person with whom Phivida has contracted.

LEGAL PROCEEDINGS AND REGULATORY ACTIONS

Phivida is not, and was not during the most recently completed financial year, or from the end of the most recently completed financial year to the date of this Circular, a party to, nor was any of its property the subject of, any legal proceedings or regulatory actions material to Phivida, and no such proceedings or actions are known to be contemplated.

MATERIAL CONTRACTS

Except for contracts made in the ordinary course, the following are the only material contracts entered into by Phivida since the beginning of the last financial year ending before the date of this Circular or before the beginning of the last financial year ending before the date of this Circular, that is still in effect:

G-19

Arrangement Agreement – for a description of the material terms and conditions of the Arrangement Agreement, please see the Circular of which this Appendix “G” forms a part under the heading “ Information Concerning the Arrangement – the Arrangement Agreement ”

AUDIT COMMITTEE

Under National Instrument 52-110 - Audit Committees (“ NI 52-110 ”), Phivida is required to include in this Circular the disclosure required under Form 52-110F2 with respect to the audit committee (the “ Audit Committee ”) of the Phivida Board, including the composition of the Audit Committee, the text of the Audit Committee charter (attached hereto as Schedule “1”), and the fees paid to the external auditor.

Composition of the Audit Committee

The following are the current members of the Audit Committee:

Name	Independence(1)	Financial Literacy
Peter Simeon	Non-Independent(2)	Financially Literate
David Moon	Non-Independent	Financially Literate
John Di Girolamo(3)	Independent	Financially Literate

Notes:

(1) Phivida is a “venture issuer” for the purposes of NI 52-110. As such, Phivida is exempt from the requirement to have the Audit Committee comprised entirely of independent members.
(2) Mr. Simeon is a partner at a firm that provides legal services to Phivida and, therefore, is not independent for purposes of the Audit Committee pursuant to NI 52-110. Mr. Simeon is considered independent for purposes of corporate governance and other purposes.
(3) Mr. Di Girolamo is the Chair of the Audit Committee.

Relevant Education and Experience

Peter Simeon : Mr. Simeon has over 16 years of experience as a lawyer focused on securities, corporate finance and mergers and acquisitions. Mr. Simeon regularly reviews financial statements to provide advice to clients, and has acted as a director, and served on the Audit Committee of, several public companies.

David Moon : Mr. Moon founded Wikala.com Inc. in January 2017 and currently serves as President of Wikala.com Inc. and as a director of the Phivida Board. Previously, he co-founded Investintech.com Inc., a software company he led as President and as a board member. He has managed international, distributed teams involving technology and product development and navigated hyper-competitive markets subject to constant change. Prior to his business involvement, Mr. Moon practiced law as a securities lawyer. He received his J.D. and MBA at the University of Toronto and his B.A. from McGill University.

John Di Girolamo : Mr. Di Girolamo is the Managing Partner of Liberty North Capital Corp., an independent, boutique investment bank focusing on finance and advisory services for both private and public companies. Mr. Di Girolamo brings a wealth of capital market expertise having worked in the industry for 20 years. He has been an active investor and advisor to companies in the cannabis sector, and also acts as a director and President at Starling Brands, a manufacturer of premium cannabis products in California.

G-20

Prior to founding Liberty North Capital, Mr. Di Girolamo held roles in trading and wealth management. Mr. Di Girolamo received his B.A. from York University.

Reliance on Certain Exemptions

At no time since the commencement of Phivida’s most recently completed financial period has it relied on the exemption in:

(a) Section 2.4 of NI 52-110 ( De Minimis Non-Audit Services ); or
(b) an exemption from NI 52-110, in whole or in part, granted under Part 8 of NI 52-110.

Phivida is relying on the exemption provided in Section 6.1 of NI 52-110 as Phivida is a “venture issuer”. As a result, Phivida is exempt from the requirements of Part 3 ( Composition of Audit Committee ) and Part 5 ( Reporting Obligations ) of NI 52-110.

Pre-Approval Policies and Procedures

The Audit Committee has not adopted any specific policies and procedures for the engagement of nonaudit services.

External Auditor Service Fees (By Category)

The following table discloses the fees billed to the Company by its external auditor for each of the two most recently completed financial years.

Audit Service Fees	Year-ended September 30, 2019	Year-ended September 30, 2018
Audit Fees	$55,000	$42,500
Audit Related Fees	$22,080	$15,000
Tax Fees	$7,015	$7,500
All Other Fees	$5,125	Nil
Total	$89,220	$65,000

Notes:

(1) “Audit Fees” includes fees for the performance of the annual audit and for accounting consultations on matters reflected in the financial statements.

(2) “Audit Related Fees” includes fees for assurance and related services, related to the performance of the review of the financial statements including fees for AIF and “earn-in” audit work that are not reported under Audit Fees.
(3) “Tax Fees” includes the fees paid for tax compliance, tax planning and tax advice.

CORPORATE GOVERNANCE

Corporate governance relates to the activities of the Phivida Board, the members of which are elected by and are accountable to the Phivida Shareholders, and takes into account the role of the individual members of management who are appointed by the Phivida Board and who are charged with our day-to-day management. The Phivida Board will monitor such practices on an ongoing basis and when necessary implement such additional practices as it deems appropriate.

G-21

National Instrument 58-201 – Corporate Governance Guidelines (“ NI 58-201 ”) establishes corporate governance guidelines to be used by issuers in developing their own corporate governance practices. The Phivida Board is committed to sound corporate governance practices, which are both in the interest of Phivida Shareholders and contribute to effective and efficient decision making. Pursuant to NI 58-201, the Phivida Board has adopted a Code of Business Conduct and Ethics, which addresses, but is not limited to, the following issues:

(a) conflicts of interest;
(b) compliance with laws, rules and regulations
(c) protection and proper use of corporate opportunities;
(d) confidentiality of corporate information
(e) fair dealing with security holders, customers, competitors and employees; and
(f) accuracy of business records.

In addition, pursuant to NI 51-201 – Disclosure Standards , we have adopted a disclosure policy, which addresses, but is not limited to addressing, the following issues:

(a) timely disclosure of material information;
(b) insider trading;
(c) the development and mandate of our disclosure committee;
(d) rumours and speculation; and
(e) our designated spokespersons

Board of Directors

The Phivida Board is responsible for supervising the management of the business and affairs of Phivida. The Phivida Board is currently comprised of two independent directors and one non-independent director. The independent directors are Peter Simeon and John Di Girolamo as such term is contemplated under National Instrument 58-101 – Disclosure of Corporate Governance Practices . David Moon is not independent by virtue of being Phivida’s current Interim Chief Executive Officer.

The Phivida Board has plenary power to manage and supervise the management of Phivida’s business and affairs and to act in Phivida’s best interest. The Phivida Board is responsible for the Phivida’s overall stewardship and approves all significant decisions that affect Phivida before they are implemented. The Phivida Board also considers their implementation and reviews the results. Any related party transaction as such term is defined in MI 61-101, is subject to review by the independent directors of the Phivida Board.

Directorships

Certain of Phivida’s directors are currently directors of other reporting issuers (or equivalent) in a jurisdiction or a foreign jurisdiction as follows:

G-22

Name	Name of Reporting Issuer	Position	Exchange or Market
Peter Simeon	AF1 Capital Corp.	Director	TSX Venture Exchange
	Amilot Capital Inc.	Director	TSX Venture Exchange
	Wolf Acquisition Corp.	Director	TSX Venture Exchange

Orientation and Continuing Education of Board Members

New members of the Phivida Board are briefed about the nature of our business, our corporate strategy and our current issues. New directors will be encouraged to review our public disclosure records as filed on SEDAR at www.sedar.com after we became a reporting issuer. Directors are also provided with access to management to better understand our operations, and to our legal counsel to discuss their legal obligations as our directors.

Ethical Business Conduct

The Phivida Board has adopted a written Code of Business Conduct and Ethics for all our directors, officers and future employees and our subsidiaries.

The Phivida Board is also required to comply with the conflict of interest provisions of the BCBCA and relevant securities regulation in order to ensure that directors exercise independent judgment in considering transactions and agreements in respect of which a director or officer has a material interest. Any interested director is required to declare the nature and extent of his interest and is not entitled to vote on any matter that is the subject of the conflict of interest.

Further, the Phivida Board has adopted a written whistleblower policy to ease the reporting of ethical complaints or other violations of the Code of Business Conduct and Ethics.

Nominations of Directors

The size of the Phivida Board is reviewed annually when the Phivida Board considers the number of directors to recommend for election at the annual meeting of Phivida Shareholders. The Phivida Board takes into account the number of directors required to carry out the duties of the Phivida Board effectively, and to maintain a diversity of view and experience.

Compensation of Directors and Officers

The independent member(s) of the Phivida Board review and determine the compensation of directors and officers. The Phivida Board meets at least annually to establish, administer and evaluate the compensation philosophy, policies and plans for directors and officers regarding director and executive compensation and to review the performance and determine the compensation of the Chief Executive Officer, based on criteria including the Phivida’s performance and accomplishment of long-term strategic objectives, each individual officer’s performance and comparable compensation paid to similarly-situated officers in comparable companies.

Other Board Committees

Other than as disclosed in this Circular, there are no committees of the Phivida Board as of the date hereof.

G-23

Assessment of Directors, the Phivida Board and Board Committees

The Phivida Board monitors the adequacy of information given to directors, the communications between the Phivida Board and management and the strategic direction and processes of the Phivida Board and its committees, to satisfy itself that the Phivida Board, its committees and its individual directors are performing effectively.

RISK FACTORS

The following risks should be carefully considered when deciding whether to make an investment in Phivida and the Phivida Shares. Some of the following factors are interrelated and, consequently, investors should treat such risk factors as a whole. These risks and uncertainties are not the only ones that could affect Phivida or the Phivida Shares, and additional risks and uncertainties not currently known to Phivida, or that it currently considers not to be material, may also impair the business, financial condition and results of operations of Phivida and/or the value of the Phivida Shares. If any of the following risks or other risks occur, they could have a material adverse effect on Phivida’s business, financial condition and results of operations and/or the value of the Phivida Shares. There is no assurance that any risk management steps taken by Phivida will avoid future loss due to the occurrence of the risks described below or other unforeseen risks.

Risks Related to COVID-19

As of the date of this Circular, markets, governments and health organizations around the world are working to contain the outbreak of the novel coronavirus, which causes coronavirus disease (COVID-19). COVID-19 may present a wide range of potential issues or complications for Phivida, most of which we are not yet able to know the full extent of. The following are potential risks relating to the disruption of our business:

disruptions to business operations resulting from quarantines of employees and third party service providers;
disruptions to business operations resulting from travel restrictions; and
uncertainty around the duration and severity of the virus’ impact.

At this time it is unclear as to whether COVID-19 will represent a material disruption to Phivida’s business, but a significant outbreak in the United States and Canada could result in a widespread health crisis that could further adversely affect our economies and financial markets, resulting in an economic downturn that could affect financing opportunities and demand for Phivida’s products which could negatively impact, among other things, our liquidity and operating results.

Risks Relating to Phivida’s Business

Market Risks for Securities

Volatility in the price of the Phivida Shares could cause Phivida Shareholders to lose all or part of their investment because they may not be able to sell the Phivida Shares at or above the price they paid. Factors that could cause fluctuations in the market price of the Phivida Shares include the following:

price and volume fluctuations in the overall stock market from time to time:

G-24

volatility in the market prices and trading volumes of stocks of companies that are involved in the same industry as Phivida
changes in operating performance and stock market valuations of other companies that are involved in the same industry as Phivida;
sales of Phivida Shares by Phivida Shareholders;
announcements by Phivida’s competitors regarding new products or services;
the public’s reaction to Phivida’s news releases, other public announcements and filings with securities commissions;
rumours and market speculation involving Phivida or other companies in Phivida’s industry;
actual or anticipated changes in Phivida’s operating results or fluctuations in Phivida’s operating results;
actual or anticipated developments in Phivida’s business, or that of its competitors or the competitive landscape generally;
litigation involving Phivida, its industry or both, or investigations by regulatory into Phivida’s operations or those of its competitors;
developments or disputes concerning Phivida’s intellectual property or other proprietary rights;
announced or completed acquisitions of businesses or technologies by Phivida or its competitors;
new laws or regulations or new interpretations of existing laws or regulations applicable to Phivida’s business;
changes in accounting standards, policies, guidelines, interpretations or principles;
any significant changes in Phivida’s management; and
general economic conditions and slow or negative growth of Phivida’s markets.

No Prospect of Dividends

Phivida does not currently anticipate that any dividends will be paid on the Phivida Shares for the foreseeable future. As such, shareholders may not realize a return on their investment. See “ Dividends or Distributions ”.

History of Operating Losses

Phivida has limited history of earnings, limited cash reserves, a limited operating history, has not paid dividends, and is unlikely to pay dividends in the immediate or near future. Phivida has a history of operating losses and may not achieve or sustain profitability. Phivida cannot guarantee shareholders that it will become profitable, and even if Phivida achieves profitability, given the competitive and evolving nature of the industry in which it operates, Phivida may not be able to sustain or increase profitability and its failure to do so could adversely affect Phivida’s business, including its ability to raise additional funds.

Liquidity and Future Financing Risk

Phivida is in the development stage and have not generated a significant amount of revenue. Phivida will likely operate at a loss until business becomes established and it may require additional financing in order to fund future operations and expansion plans, including developing new products, enhancing existing products, enhancing its operating infrastructure and acquiring complementary businesses and technologies. Phivida’s ability to secure any required financing to sustain operations will depend in part upon prevailing capital market conditions, as well as business success. There can be no assurance that Phivida will be successful in its efforts to secure any additional financing or additional financing on terms

G-25

satisfactory to management. If additional financing is raised by issuing Phivida Shares in its authorized capital, control may change and shareholders may suffer additional dilution.

Going-Concern Risk

Phivida’s financial statements have been prepared on a going concern basis under which an entity is considered to be able to realize its assets and satisfy its liabilities in the ordinary course of business. Phivida’s future operations are dependent upon the identification and successful completion of equity or debt financing and the achievement of profitable operations at an indeterminate time in the future. There can be no assurances that Phivida will be successful in completing equity or debt financing or in achieving profitability. The financial statements do not give effect to any adjustments relating to the carrying values and classification of assets and liabilities that would be necessary should Phivida be unable to continue as a going concern.

Competition

Phivida faces competition in the markets in which it operates and intends to operate in the near future. Some of Phivida’s competitors may be better positioned to develop superior product features and technological innovations, and able to better adapt to changing market conditions. Phivida’s ability to compete depends on, among other things, consistent high product quality, short lead time, timely delivery, competitive pricing, range of product offerings and superior customer service and support. Increased competition in the markets in which Phivida operates may force Phivida to reduce its product prices or may result in increased costs, and may have a material adverse effect on its business and operating results. Any decrease in the quality of the Phivida’s products or level of service to customers, or any forced decrease in product pricing may adversely affect its business and operating results.

In addition, the industry in which Phivida operates is highly competitive. The Company may not have sufficient resources to maintain any competitive advantages, including research and development, marketing, sales and customer services on a competitive basis which could materially and adversely affect Phivida’s business, financial condition and results of operations.

Agricultural Operations Risk

Phivida’s business is dependent on the growth and production of industrial hemp, an agricultural product. As such, the risks inherent in engaging in agricultural businesses apply to Phivida. Potential risks include the risk that crops may become diseased or victim to insects or other pests and contamination, or subject to extreme weather conditions such as excess rainfall, freezing temperature, or drought, all of which could result in low crop yields, decreased availability of industrial hemp, and higher acquisition prices. Although Phivida sources CBD-hemp oil from hemp grown in controlled environments, there can be no guarantee that an agricultural event will not adversely affect Phivida’s business and operating results.

Success of Quality Control Systems

The quality and safety of Phivida’s products are critical to the success of its business and operations. As such, it is imperative that Phivida’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 Phivida strives to ensure that all of its service providers have implemented and adhere to high-

G-26

caliber quality control systems, any significant failure or deterioration of such quality control systems could have a material adverse effect on the Phivida’s business and operating results.

Reliance on Third Party Suppliers and Manufacturers

Phivida intends to maintain a full supply chain for the production of wholesale bulk CBD-hemp oil, extracts, oils and isolates; and hemp oil extract-infused consumer and clinical products. Despite maintaining full federal compliance and legality, Phivida’s co-packers and ingredient and packaging suppliers may elect, at any time, to cease to engage in production agreements for products containing hemp oil extracts. Sourcing cGMP and organic and kosher contract manufacturers willing to produce hemp oil extracts has provided challenges to management to date, and although Phivida has identified and contacted alternatives for contract manufacturers and ingredient suppliers, there is a risk of losing its current manufacturers and its alternative manufacturers. Loss of manufacturers and suppliers would have a material adverse effect on Phivida’s business and operational results.

Internet Security poses a risk to e-commerce sales

At present, Phivida generates a portion of revenues through e-commerce sales on its e-commerce platforms. Any compromise of the security or misappropriation of proprietary information could have a material adverse effect on the business, financial condition and results of operations of Phivida. Advances in computer capabilities or other events or developments may result in a compromise or breach of the technology used by Phivida to protect client transaction data. Anyone who is able to circumvent our security measures could misappropriate proprietary information or cause material disruptions in Phivida’s operations. Phivida may be required to expend significant capital and other resources to protect against security breaches or to minimize problems caused by security breaches. To the extent that Phivida’s activities or the activities of others involve the storage and transmission of proprietary information, security breaches could damage its reputation and expose Phivida to a risk of loss and/or litigation. Phivida’s security measures may not prevent security breaches. Phivida’s failure to prevent these security breaches may result in consumer distrust and may adversely affect its business, results of operations and financial condition.

Product Liability

Phivida’s food products are produced for sale both directly and indirectly to end consumers, and therefore Phivida faces an inherent risk of exposure to product liability claims, regulatory action and litigation of the Phivida’s products alleging to have caused significant loss or injury. In addition, the manufacture and sale of hemp oil infused products involves the risk of injury to consumers due to tampering by unauthorized third parties or product contamination. Previously unknown adverse reactions resulting from human consumption of Phivida’s products alone or in combination with other medications or substances could occur. Phivida may be subject to various product liability claims, including, among others, that its products caused injury or illness, include inadequate instructions for use or include inadequate warnings concerning possible side effects or interactions with other substances. A product liability claim or regulatory action against Phivida could result in increased costs, could adversely affect Phivida’s reputation, and could have a material adverse effect on Phivida’s business and operational results.

Product Recalls

Product manufacturers and distributors are sometimes required to recall or initiate returns of their products for various reasons, including product defects such as contaminations, unintended harmful side

G-27

effects or interactions with other products, packaging safety and inadequate or inaccurate labeling disclosure. If any of Phivida’s products are recalled, Phivida could incur unexpected expense relating to the recall and any legal proceedings that might arise in connection with the recall. Phivida may lose significant revenue due to loss of sales and may not be able to compensate for or replace that revenue. Although Phivida strives to contract cGMP-certified manufacturers for the production of raw products for wholesale and finished goods, there can be no assurance that any quality, potency or contamination problems will be detected in time to avoid unforeseen product recalls, regulatory actions or lawsuits. A recall of Phivida’s products could lead to adverse publicity, decreased demand for Phivida’s products and could have a material adverse effect on Phivida’s results of operations and financial condition.

Maintaining and Promoting Phivida’s Brand

Phivida believes that maintaining and promoting its brand is critical to expanding its customer base. Maintaining and promoting Phivida’s brand will depend largely on its ability to continue to provide quality, reliable and innovative products, which Phivida may not do successfully. Phivida may introduce new products or services that its customers do not like, which may negatively affect Phivida’s brand and reputation. Maintaining and enhancing Phivida’s brand may require it to make substantial investments, and these investments may not achieve the desired goals. If Phivida fails to successfully promote and maintain its brand or if it incurs excessive expenses in this effort, Phivida’s business and financial results from operations could be materially adversely affected.

Changing Customer Preferences

As a result of changing consumer preferences, many nutraceutical and other innovative products attain financial success for a limited period of time. Even if Phivida’s products find retail success, there can be no assurance that any of its products will continue to see extended financial success. Phivida’s success will be dependent upon its ability to develop new and improved product lines. Even if Phivida is successful in introducing new products or developing its current products, a failure to continue to update them with compelling content could cause a decline in Phivida’s products' popularity that could reduce its revenues and harm its business, operating results and financial condition. Phivida’s failure to introduce new features and product lines and to achieve and sustain market acceptance could result in Phivida being unable to meet consumer preferences and generate revenue which would have a material adverse effect on its profitability and financial results from operations.

Key Personnel Risk

Phivida’s success and future growth will depend, to a significant degree, on the continued efforts of Phivida’s directors and officers to develop the business and manage operations and on their ability to attract and retain key technical, scientific, sales and marketing staff or consultants. The loss of any key person or the inability to attract and retain new key persons could have a material adverse effect on the Phivida’s business. Competition for qualified technical, scientific, sales and marketing staff, as well as officers and directors can be intense and no assurance can be provided that Phivida will be able to attract or retain key personnel in the future. Phivida’s inability to retain and attract the necessary personnel could materially adversely affect Phivida’s business and financial results from operations.

Fluctuations in Foreign Currency Exchange Rates

Phivida is subject to foreign currency risk. The strengthening or weakening of the Canadian or US dollar versus other currencies will impact the translation of Phivida’s net revenues generated in these foreign

G-28

currencies into Canadian and US dollars. Phivida imports certain ingredients in its products from foreign countries, and so may become forced to pay higher rates for Phivida’s ingredients as a result of the weakening of the Canadian or US dollar.

Risks Related to Phivida’s Prices

As the market for Phivida’s products matures, or as new or existing competitors introduce new products or services that compete with ours, Phivida may experience pricing pressure and be unable to renew its agreements with existing customers or attract new customers at prices that are consistent with Phivida’s pricing model and operating budget. If this were to occur, it is possible that Phivida would have to change its pricing model or reduce Phivida’s prices, which could harm Phivida’s revenue, gross margin, and operating results.

Requirement to Generate Cash Flow for Financial Obligations

Phivida currently has negative operating cash flows. Phivida’s ability to generate sufficient cash flow from operations to make scheduled payments to its contractors, service providers and merchants will depend on future financial performance, which will be affected by a range of economic, competitive, regulatory, legislative, and business factors, many of which are outside of Phivida’s control. If Phivida does not generate sufficient cash flow from operations to satisfy its contractual obligations, Phivida may have to undertake alternative financing plans. Phivida’s inability to generate sufficient cash flow from operations or undertake alternative financing plans would have an adverse effect on Phivida’s business, financial condition and results or operations, as well as its ability to satisfy Phivida’s contractual obligations. Any failure to meet Phivida’s financial obligations could result in termination of key contracts, which could harm Phivida’s ability to provide the Company's products.

Uninsured or Uninsurable Risk

Phivida may become subject to liability for risks which are uninsurable or against which Phivida may opt out of insuring due to the high cost of insurance premiums or other factors. The payment of any such liabilities would reduce the funds available for usual business activities. Payment of liabilities for which insurance is not carried may have a material adverse effect on Phivida’s financial position and operations.

Conflicts of Interest Risk

Certain of Phivida’s directors and officers are, and may continue to be, involved in other business ventures in the hemp products and nutraceutical industry through their direct and indirect participation in corporations, partnerships, joint ventures, etc. that may become potential competitors to Phivida. Situations may arise in connection with potential acquisitions or opportunities where the other interests of these directors and officers conflict with or diverge from Phivida’s interests. In accordance with the BCBCA, directors who have a material interest in any person who is a party to a material contract or a proposed material contract are required, subject to certain exceptions, to disclose that interest and generally abstain from voting on any resolution to approve the contract. In addition, the directors and officers are required to act honestly and in good faith with a view to Phivida`s best interests. However, in conflict of interest situations, directors and officers may owe the same duty to another company and will need to balance their competing interests with their duties to Phivida. Circumstances (including with respect to future corporate opportunities) may arise that may be resolved in a manner that is unfavourable to Phivida.

G-29

Regulatory Risks

Regulatory Approvals and Permits

The activities of Phivida are subject to regulation by governmental authorities. Achievement of Phivida’s business objectives are contingent, in part, upon compliance with regulatory requirements enacted by these governmental authorities and obtaining all regulatory approvals, where necessary, for the sale of its products. Phivida may be required to obtain and maintain certain permits, licenses and approvals in the jurisdictions where Phivida’s products are licensed, although it does not currently anticipate that such approvals will be necessary. There can be no assurance that Phivida will be able to obtain or maintain any necessary licenses, permits or approvals, and any material delay or inability to receive these items is likely to delay and/or inhibit Phivida’s ability to conduct its business, and would have an adverse effect on Phivida’s business, financial condition and results of operations.

Potential Changes in Federal and State Laws and Regulations

If state and/or federal legislation changes or regulatory agencies amend their practices or interpretive policies, or expended its resources enforcing existing state and/or federal laws, such action(s) could have a materially adverse effect on; (a) Phivida’s ability to obtain lawfully sourced raw materials; and, (b) the manufacturing, marketing, distribution and sale of Phivida’s products in one or multiple jurisdictions, up to and including a complete interruption of its business. Further, additional government disruption in the industrial hemp industry could cause potential customers and users to be reluctant to purchase Phivida’s products, which would be detrimental. Phivida cannot predict the nature of any future federal, state and/or laws, regulations, interpretations or applications, nor can it determine what effect additional governmental regulations or administrative policies and procedures, when and if promulgated, could have on the its business.

Intellectual Property Risks

Risks Related to Potential Inability to Protect Intellectual Property

Phivida’s success is heavily dependent upon its intellectual property and technology. Phivida licenses certain technology from third parties and there can be no assurance that it will be able to continue licensing these rights on a continuous basis. Phivida relies upon copyrights, trade secrets, unpatented proprietary know-how and continuing technology innovation to protect the technology that it considers important to the development of its business. Phivida relies on various methods to protect its proprietary rights, including confidentiality agreements with its consultants, service providers and management that contain terms and conditions prohibiting unauthorized use and disclosure of its confidential information. However, despite Phivida’s efforts to protect its intellectual property rights, unauthorized parties may attempt to copy or replicate its technology. There can be no assurances that the steps taken by Phivida to protect its technology will be adequate to prevent misappropriation or independent third-party development of its technology. It is likely that other companies can duplicate a production process similar to ours. To the extent that any of the above could occur, Phivida’s revenue could be negatively affected, and in the future, Phivida may have to litigate to enforce its intellectual property rights, which could result in substantial costs and divert management's attention and its resources.

G-30

Risks Relating to Intellectual Property Claims

Companies in the retail and wholesale consumer product industries frequently own trademarks and trade secrets and often enter into litigation based on allegations of infringement or other violations of intellectual property rights. Phivida may be subject to intellectual property rights claims in the future and its products may not be able to withstand any third-party claims or rights against their use. Any intellectual property claims, with or without merit, could be time consuming, expensive to litigate or settle and could divert management resources and attention. An adverse determination also could prevent Phivida from offering its products and services to others and may require that Phivida procure substitute products or services for these members.

With respect to any intellectual property rights claim, Phivida may have to pay damages or stop using intellectual property found to be in violation of a third party's rights. Phivida may have to seek a license for the intellectual property, which may not be available on reasonable terms and may significantly increase its operating expenses. The technology also may not be available for license to Phivida at all. As a result, Phivida may also be required to pursue alternative options, which could require significant effort and expense. If Phivida cannot license or obtain an alternative for the infringing aspects of its business, Phivida may be forced to limit its product and service offerings and may be unable to compete effectively. Any of these results could harm Phivida’s brand and prevent it from generating sufficient revenue or achieving profitability.

Economic Risks

Global Economy Risk

The current COVID-19 pandemic and, prior to that, the economic slowdown and downturn of global capital markets has generally made the raising of capital by equity or debt financing more difficult. If the Arrangement is not completed, Phivida will be dependent upon the capital markets to raise additional financing in the future while establishing a user base. Access to financing has been negatively impacted by the ongoing global economic downturn. As such, Phivida is subject to liquidity risks in meeting development and future operating cost requirements in instances where cash positions are unable to be maintained or appropriate financing is unavailable. These factors may impact Phivida’s ability to raise equity or obtain loans and other credit facilities in the future and on terms favourable to it and management. If uncertain market conditions persist, the ability to raise capital could be jeopardized and thus have an adverse impact on operations and on the trading price of the Phivida Shares on the CSE.

Trends, Risks and Uncertainties

Phivida has sought to identify what it believes to be the most significant risks to its business, but it cannot predict whether, or to what extent, any of such risks may be realized nor can it guarantee that it has identified all possible risks that might arise. Investors should carefully consider all of such risk factors before making an investment decision with respect to the Phivida Shares.

G-31

Schedule “1”

Audit Committee Charter

This Charter establishes the composition, the authority, roles and responsibilities and the general objectives of the Company’s audit committee, or its Board of Directors in lieu thereof (the “ Audit Committee ”). The roles and responsibilities described in this Charter at all times be exercised in compliance with the legislation and regulations governing the Company and any subsidiaries.

1. Composition

(a) Number of Members. The Audit Committee must be comprised of a minimum of three directors of the Company.
(b) Chair. If there is more than one member of the Audit Committee, members will appoint a chair of the Audit Committee (the “ Chair ”) to serve for a term of one (1) year on an annual basis. The Chair may serve as the chair of the Audit Committee for any number of consecutive terms.
(c) Financial Literacy . All members of the audit committee will be financially literate as defined by applicable legislation. If upon appointment a member of the Audit Committee is not financially literate as required, the person will be provided with a period of three months to acquire the required level of financial literacy.
(d) Independence . At least a majority of the members of the Audit Committee must be independent within the meaning of Section 1.4 of National Instrument 52-110.

2. Meetings

(a) Quorum. The quorum required to constitute a meeting of the Audit Committee is set at a majority of members.
(b) Agenda . The Chair will set the agenda for each meeting, after consulting with management and the external auditor. Agenda materials such as draft financial statements must be circulated to all Audit Committee members for members to have a reasonable amount of time to review the materials prior to the meeting.
(c) Notice to Auditors. The Company’s auditors (the “ Auditors ”) will be provided with notice as necessary of any Audit Committee meeting, will be invited to attend each such meeting and will receive an opportunity to be heard at those meetings on matters related to the Auditor’s duties.
(d) Minutes . Minutes of the Audit Committee meetings will be accurately recorded, with such minutes recording the decisions reached by the committee.

G-32

3. Roles and Responsibilities

The roles and responsibilities of the Audit Committee include the following:

External Auditor

The Audit Committee will:

(a) Selection of the external auditor. Select, evaluate and recommend to the Board, for shareholder approval, the Auditor to examine the Company’s accounts, controls and financial statements.
(b) Scope of Work. Evaluate, prior to the annual audit by the Auditors, the scope and general extent of the Auditor’s review, including the Auditor’s engagement letter.
(c) Compensation. Recommend to the Board the compensation to be paid to the external auditors.
(d) Replacement of Auditor. If necessary, recommend the replacement of the Auditor to the Board of Directors.
(e) Approve Non-Audit Related Services. Pre-approve all non-audit services to be provided by the Auditor to the Company or its subsidiaries.
(f) Responsibility for Oversight. Must directly oversee the work of the Auditor. The Auditor must report directly to the Audit Committee.
(g) Resolution of Disputes. Assist with resolving any disputes between the Company’s management and the Auditors regarding financial reporting.

Consolidated Financial Statements and Financial Information

The Audit Committee will:

(a) Review Audited Financial Statements. Review the audited consolidated financial statements of the Company, discuss those statements with management and the Auditor, and recommend their approval to the Board.
(b) Review of Interim Financial Statements. Review and discuss with management the quarterly consolidated financial statements, and if appropriate, recommend their approval by the Board.
(c) MD&A, Annual and Interim Earnings Press Releases, Audit Committee Reports. Review the Company’s management discussion and analysis, interim and annual press releases, and audit committee reports before the Company publicly discloses this information.
(d) Auditor Reports and Recommendations. Review and consider any significant reports and recommendations issued by the Auditor, together with management’s response, and the extent to which recommendations made by the Auditor have been implemented.

G-33

Risk Management, Internal Controls and Information Systems

The Audit Committee will:

(a) Internal Control. Review with the Auditors and with management, the general policies and procedures used by the Company with respect to internal accounting and financial controls. Remain informed, through communications with the Auditor, of any weaknesses in internal control that could cause errors or deficiencies in financial reporting or deviations from the accounting policies of the Company or from applicable laws or regulations.
(b) Financial Management. Periodically review the team in place to carry out financial reporting functions, circumstances surrounding the departure of any officers in charge of financial reporting, and the appointment of individuals in these functions.
(c) Accounting Policies and Practices. Review management plans regarding any changes in accounting practices or po9licies and the financial impact thereof.
(d) Litigation. Review with the auditors and legal counsel any litigation, claim or contingency, including tax assessments, that could have a material effect upon the financial position of the Company and the manner in which these matters are being disclosed in the consolidated financial statements.
(e) Other . Discuss with management and the Auditors correspondence with regulators, employee complaints, or published reports that raise material issues regarding the Company’s financial statements or disclosure.

Complaints

(a) Accounting, Auditing and Internal Control Complaints. The Audit Committee must establish a procedure for the receipt, retention and treatment of complaints received by the Company regarding accounting, internal controls or auditing matters.
(b) Employee Complaints. The Audit Committee must establish a procedure for the confidential transmittal on condition of anonymity by the Company’s employees of concerns regarding questionable accounting or auditing matters.

4. Authority

(a) Auditor. The Auditor, and any internal auditors hired by the company, will report directly to the Audit Committee.
(b) Independent Advisors. The Audit Committee may, at the Company’s expense and without the approval of management, retain the services of independent legal counsels and any other advisors it deems necessary to carry out its duties and set and pay the monetary compensation of these individuals.

G-34

(c) Communication. The Audit Committee may communicate directly with management and any internal auditor, and with the Auditor directly without the presence or involvement of management.
(d) Expenses. The Audit Committee may incur such ordinary administrative expenses that it deems necessary and appropriate to carry out its duties, which expenses the Company will pay or reimburse upon receiving an invoice or receipt, as applicable.

5. Reporting

The Audit Committee will report to the Board on:

(a) the Auditor’s independence;
(b) the performance of the Auditor and any recommendations of the Audit Committee in relation thereto;
(c) the reappointment and termination of the Auditor;
(d) the adequacy of the Company’s internal controls and disclosure controls;
(e) the Audit Committee’s review of the annual and interim consolidated financial statements;
(f) the Audit Committee’s review of the annual and interim management discussion and analysis;
(g) the Company’s compliance with legal and regulatory matters to the extent they affect the financial statements of the Company; and
(h) all other material matters dealt with by the Audit Committee.

H-1

APPENDIX “H”

ADDITIONAL INFORMATION CONCERNING CHOOM BEFORE AND AFTER THE ARRANGEMENT

Unless the context indicates otherwise, capitalized terms which are used in this Appendix “H” and are not otherwise defined herein have the meanings given to such terms under the heading “Glossary of Terms” in this Circular.

DOCUMENTS INCORPORATED BY REFERENCE

Information has been incorporated by reference in this Appendix “H” from documents filed by Choom with securities commissions or similar authorities in Canada. Copies of the documents incorporated herein by reference may be obtained on request, without charge, from Choom at 208 – 1525 West 8[th] Avenue, Vancouver, British Columbia V6J 1T5. In addition, copies of the documents incorporated by reference may be obtained through Choom’s SEDAR profile at www.sedar.com.

The following documents of Choom are specifically incorporated by reference in this Circular:

(a) the audited consolidated financial statements of Choom for the years ended June 30, 2019 and 2018 and filed on October 28, 2019, together with the notes thereto;
(b) management’s discussion and analysis of the financial condition and results of operations of Choom for the year ended June 30, 2019 filed on October 28, 2019;
(c) the unaudited condensed consolidated interim financial statements of Choom for the three and nine months ended March 31, 2020 and 2019 and filed on June 1, 2020, together with the notes thereto;
(d) management’s discussion and analysis of the financial condition and results of operations of Choom for the three and nine months ended March 31, 2020; and filed on June 1, 2020;
(e) the material change report of Choom dated June 26, 2020 in respect of the issuance of an amended and restated convertible debenture;
(f) the material change report of Choom dated June 4, 2020 in respect of the Arrangement;
(g) the material change report of Choom dated April 22, 2020 in respect of the adoption of a restricted share unit plan;
(h) the material change report of Choom dated April 7, 2020 in respect of the completion of the acquisition of 2688412 Ontario Inc.;
(i) the material change report of Choom dated November 7, 2019 in respect of the completion of the acquisition of assets from Clarity Cannabis MD Holdings Inc.; and
(j) the management information circular at April 15, 2019 and filed on April 17, 2019 (the “ 2019 Information Circular ”).

H-2

Any documents of the type required by National Instrument 44-101 – Short Form Prospectus Distributions to be incorporated by reference in a short form prospectus, including any annual information form, annual financial statements and the auditors’ report thereon, interim financial statements, management’s discussion and analysis of financial conditions and results of operations, material change reports (excluding a confidential material change report), business acquisition report and information circular, filed by Choom after the date of this Circular and before the Meeting are deemed to be incorporated by reference in this Circular.

Any statement contained in this Appendix “H” or in a document incorporated or deemed to be incorporated by reference herein will be deemed to be modified or superseded for purposes of this Appendix “H” to the extent that a statement contained in this Appendix “H” or in any other subsequently filed document which also is, or is deemed to be, incorporated by reference into this Appendix “H” modifies or supersedes that statement. The modifying or superseding statement need not state that it has modified or superseded a prior statement or include any other information set forth in the document that it modifies or supersedes. The making of a modifying or superseding statement shall not be deemed an admission for any purposes that the modified or superseded statement, when made, constituted a misrepresentation, an untrue statement of material fact or an omission to state a material fact that is required to be stated or that is necessary to make a statement not misleading in light of the circumstances in which it was made. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute part of this Appendix “H”.

CHOOM

Name, Address, and Incorporation

Choom was incorporated on September 18, 2006 under BCBCA as “Orocan Resource Corp.” On January 27, 2012, Choom received shareholder approval to change its name to “Standard Graphite Corporation” and on November 17, 2017, Choom received approval to change its name to “Choom Holdings Inc.”. Choom’s head office and registered and records office are located at #208 – 1525 West 9th Avenue, Vancouver, B.C., V6J 1T5.

Intercorporate Relationships

As at the date of this Circular, Choom has the following material wholly-owned subsidiaries:

Name of Subsidiary	Jurisdiction
2151414 Alberta Ltd.	Alberta
Universal Cannabis Coaching Inc.	British Columbia
Western Cannabis Coaching Centre Inc.	British Columbia
1165962 BC Ltd.	British Columbia
Concord Medical Centre Inc.	British Columbia

H-3

Name of Subsidiary	Jurisdiction
Choom BC Retail Holdings Inc.	British Columbia
2688412 Ontario Inc.	Ontario

Choom conducts its business through its various directly held subsidiaries. The following organizational chart sets out, as of the date hereof, the material subsidiaries of Choom. Unless otherwise noted, all lines represent 100% ownership of the outstanding securities of the applicable subsidiary.

==> picture [476 x 102] intentionally omitted <==

----- Start of picture text -----

Choom Holdings Inc.
2151414 AB 2688412 ON Choom BC UCC 1165962 BC WCC Concord
----- End of picture text -----

General Development of the Business

Three-Year History

Choom is a reporting issuer in the Provinces of British Columbia, Alberta, Saskatchewan and Ontario. On February 3, 2012, Choom began trading on the TSX Venture Exchange under the stock symbol “SGH”. Choom was previously engaged in the acquisition and exploration of mineral properties located in Canada. During this time, Choom did not earn significant revenues and was considered to be in the exploration stage. As at June 30, 2017 Choom had written off all exploration and evaluation assets.

On November 17, 2017, Choom changed its name to “Choom Holdings Inc.” and completed a change of business to the business of cultivating and selling cannabis for medical proposes and related products under the Access to Cannabis for Medical Purposes Regulations. On November 22, 2017, Choom’s shares were delisted from the TSX Venture Exchange, approved for listing on the CSE, and commenced trading thereafter under the symbol “CHOO”. On December 29, 2017, Choom obtained final approval for trading on the OTCQB operated by the OTC Markets Group Inc. and commenced trading under the symbol “CHOOF”.

On December 10, 2018 management changed Choom’s strategic plan to focus on developing a network of retail cannabis stores resulting in the decision not to pursue the cultivation sector of the cannabis industry and discontinued operations in connection with the cultivating and selling cannabis for medical purposes.

As at the date of this Circular, Choom operates in the patient counselling and retail cannabis sectors.

Description of the Business

Retail Cannabis

H-4

Choom’s business strategy is to continue to pursue retail cannabis licenses in the provinces that allow for private retailers. Choom is operating and constructing retail locations to sell cannabis and cannabis related products under its recreational brand Choom™ in select provinces. Choom currently has 16 recreational cannabis stores in Alberta, 10 of which are currently open and operating (the “ Alberta Stores ”). Additionally, Choom recently completed the acquisition of a retail store in Ontario (the “ Niagara Store ”) effective April 1, 2020. Further on May 15, 2020, Choom launched its flagship retail store in the Olympic Village neighbourhood of Vancouver, B.C. (the “ Olympic Village Store ”). Choom further expects to have operating retail stores in the provinces of British Columbia and further locations in Ontario.

Choom, through its wholly-owned subsidiary 2151414 Alberta Ltd., operates the Alberta Stores and is authorized to purchase, store and sell cannabis and cannabis accessories and other goods in accordance with the terms and conditions of its cannabis retail store licenses authorized by the Alberta Gaming, Liquor & Cannabis Commission GLC (“ AGLC ”) in Alberta.

Choom, through its wholly-owned subsidiary 2688412 Ontario Inc., operates the Niagara Store and is authorized to purchase, store and sell cannabis and cannabis accessories and other goods in accordance with the terms and conditions of its cannabis retail store licenses authorized by the Alcohol and Gaming Commission of Ontario (“ AGCO ”), in Ontario.

Choom, through its wholly-owned subsidiary Choom BC Retail Holdings Inc., operates the Olympic Village Store and is authorized to purchase, store and sell cannabis and cannabis accessories and other goods in accordance with the terms and conditions of its cannabis retail store licenses authorized by the Liquor and Cannabis Regulations Branch (“ LCRB ”) in British Columbia.

Choom’s purchase of cannabis products is determined by the applicable provincial regime. In Alberta, British Columbia and Ontario all purchases of cannabis products are made through a provincial wholesaler (that acquires its cannabis products from Licensed Producers). Pricing for cannabis products for sale in its Alberta, British Columbia and Ontario stores is set by similar regimes by the provincial regulator.

Medical Clinics and Coaching Centres

As of the date of this Circular, Choom operates three medical and two coaching clinics in British Columbia, which are operated under the name “Concord Medical Centre”. Concord Medical Centre provides medical services as well as facilitates the appropriate use of medical cannabis by connecting patients with knowledgeable practitioners, managing medical cannabis education through its subsidiaries Western Cannabis Coaching Centre Inc. (“ WCC ”) and Universal Cannabis Coaching Inc. (“ UCC ”) acting as the coaching clinics. The process focuses on four primary services which include a nurse assessment, a pharmacist assessment and physician assessment with WCC and UCC providing the cannabis coach assessment. The coaching sessions help patients navigate the cannabis regulatory system providing patient education with respect to treatment with cannabinoids. The coaching clinics further act as resources for each patient after the initial assessments with nurse practitioners, pharmacists and physicians. The decision as to which Licensed Producer to select ultimately lies with the patient. Once the patient is registered, patients place orders for a cannabis product directly with the Licensed Producer. Choom has several contracts with Licensed Producers (the “ LP Contracts ”). The LP Contracts cover the business relationship between Choom and the Licensed Producer. Pursuant to the LP Contracts the WCC and UCC are paid education grants from each Licensed Producer equal to 15 – 20% of the retail price paid

H-5

by the patient for such cannabis product. Choom’s clinics operate under municipal business licenses and it is the responsibility of the clinic’s physicians to maintain medical licenses.

Products and Services

Choom is a retail cannabis operator authorized to sell cannabis products and accessories and other products permitted to be sold in compliance with the applicable provincial regulations. These products are purchased from authorized distributors. Accessories may include rolling papers or wraps, holders, pipes, water pipes, bongs and vaporizers and other things represented to be in used in consumption of cannabis.

Specialized Skill and Knowledge

All aspects of Choom’s business requires specialized skills and knowledge. Choom believes its team has developed and sourced business systems to effectively and efficiently operate its retail operations. As part of its strategy, Choom intends to develop a chain of branded retail cannabis stores across Canada. The brand building, retail marketing and product development knowledge and skills of Choom’s management team and employees will be essential to Choom becoming a well-respected household name within the retail cannabis industry.

Competitive Conditions

Choom faces intense competition from other cannabis retailers seeking multiple licenses in multiple jurisdictions, which may have greater financial resources, market access and marketing experience than Choom. Choom expects to face additional competition from Licensed Producers, competitors with existing retail operations, government owned retailers in British Columbia and the black market.

As at the date of this Circular, Choom’s primary competitors in the provinces it operates and/or has filed applications within Alberta, British Columbia and Ontario include but are not limited to: Fire & Flower; Inner Spirit Holdings, and National Access Cannabis Corp. which are established and operate in the same provinces and in some case the same municipal locations.

To remain competitive, Choom will require a continued high level of investment in location expansion, IT systems and design, marketing and sales. Choom may not have sufficient resources to maintain location expansion, IT systems and design, marketing and sales efforts on a competitive basis which could materially and adversely affect the business, financial condition and operating results of Choom.

Intangible Properties

The Choom brand, inspired by Hawaii’s “Choom Gang”, was created exclusively for the recreational Canadian cannabis marketplace and was founded on the principal of good times and good friends.

Choom intends to develop a chain of branded retail cannabis across Canada and has worked with a design team to create a concept retail store design that is clean, modern, and stylish to bring the Choom vibe to life. Accordingly, retail identity and branding will become Choom’s competitive edge in the recreational cannabis marketplace in Canada.

H-6

The Choom™ Logo and Leaf design, “Choom™” and “Cultivating Good Times™” are trademarked by Choom Holdings Inc.

Employees

As at the date of this Circular, Choom had approximately 23 full time and 102 part-time employees.

DIVIDENDS AND DISTRIBUTIONS

No dividends have ever been paid on any shares of Choom. Choom intends to retain its earnings to finance its growth and development of its business, and therefore it is not expected that dividends will be paid on the Choom Shares in the immediate or foreseeable future. The Choom Board will determine the actual timing, payment and amount of dividends, if any, that may be paid by Choom from time to time based upon, among other things, the level of cash flow, results of operations and financial condition, the need for funds to finance ongoing operations and other business considerations as the Choom Board considers relevant.

CONSOLIDATED CAPITALIZATION

The share and loan capital of Choom as at the date hereof are disclosed in the unaudited condensed interim financial statements of Choom as at and for the three and nine months ended March 31, 2020, together with the notes thereto, which are incorporated by reference herein. There have been no material changes in the share and loan capital of Choom since the date of such interim financial statements other than as set forth below.

On June 24, 2020, Choom amended and restated a convertible debenture previously issued to an arm’s length lender (the “ Lender ”) in November 2018 (the “ Amended and Restated Debenture ”). Pursuant to the terms of the Amended and Restated Debenture, Choom agreed, among other things, to grant the Lender a second ranking security interest over all of its present and after-acquired property. The security interest will be governed in accordance with the terms and conditions of a security agreement between Choom and the Lender dated June 24, 2020. Among other amendments, the Amended and Restated Debenture includes amendments reflecting (i) a 90-day exclusivity period during which the Lender has agreed not to sell, transfer or assign its indebtedness to any third party, (ii) a right of first refusal in favour of Choom in respect of any future proposed sale, transfer or assignment of the indebtedness by the Lender, and (iii) a reduction of the conversion price of the debenture from $1.25 to $0.65 per share.

On July 23, 2020, Phivida provided the Bridge Loan, which is evidenced by a convertible secured promissory note between Choom and Phivida. For more information about the Bridge Loan, please refer to the Circular under the heading “ Information Concerning the Arrangement – Background to the Arrangement ” and “ Information Concerning the Arrangement – Other Transactions ”.

The following table sets out Choom’s consolidated capitalization as at June 30, 2019, both actual and pro forma after giving effect to the Arrangement. The financial information set out below should be read in conjunction with the audited consolidated financial statements of Choom for the years ended June 30, 2019 and June 30, 2018 (including the notes thereto), the related MD&A for the year ended June 30, 2019, the unaudited consolidated financial statements of Choom for the three and nine months ended March 31, 2020 (including the notes thereto) and the related MD&A for the three and nine months ended March 31, 2020, each incorporated by reference into this section. The financial information set out below should

H-7

also be read in conjunction with the pro forma consolidated financial statements of Choom after giving effect to the Arrangement attached as Schedule 1 to this Appendix "H" to the Circular.

Expressed in Canadian Dollars

		*Pro Forma*
	Outstanding at March 31,	Outstanding at March
	2020(unaudited)	31, 2020(1) (unaudited)
Cash and cash equivalents	658,327	4,324,105
Shareholders’ Equity	4,261,732	11,319,569
Share Capital	119,007,062	126,307,789
Contributed Surplus	8,324,547	8,597,485
Accumulated Deficit	(130,170,448)	(130,686,277)

(1) After giving effect to the Arrangement.

Choom’s pro forma share capital as at March 31, 2020, after giving effect to the Arrangement, has been determined as follows:

Expressed in Canadian Dollars

	Number of Shares	Share Capital
Common shares of Choom issued and outstandingas at March 31,2020	203,253,095	$119,007,062
Fair value of common shares issued to acquire Phivida	64,608,207	7,300,727
Pro Forma Share Capital	267,861,302	$126,307,790

DESCRIPTION OF CAPITAL STRUCTURE

The authorized capital of Choom consists of an unlimited number of Choom Shares. Holders of Choom Shares are entitled to vote at all meetings of Choom Shareholders and, subject to the rights of holders of any shares ranking in priority to or on a parity with the Choom Shares, to participate rateably in any distribution of Choom’s property or assets upon liquidation or winding-up.

MARKET FOR SECURITIES

Trading Price and Volume

The Choom Shares are listed on the CSE under the symbol “CHOO”. The following sets forth trading information for the Choom Shares as reported by the CSE for the periods indicated:

Period	Price Range	Price Range	Trading Volume
	High	Low
August (1-4)	$0.12	$0.10	6,783
July 2020	$0.15	$0.10	4,449,500

H-8

Period	Price Range	Price Range	Trading Volume
	High	Low
June 2020	$0.20	$0.14	8,534,400
May 2020	$0.15	$0.09	8,659,610
April 2020	$0.10	$0.09	3,725,050
March 2020	$0.13	$0.08	6,526,730
February 2020	$0.18	$0.11	3,713,590
January 2020	$0.21	$0.16	8,182,870
December 2019	$0.18	$0.15	6,651,710
November 2019	$0.24	$0.17	7,072,610
October 2019	$0.34	$0.22	4,925,640
September 2019	$0.43	$0.33	4,062,500
August 2019	$0.43	$0.37	5,028,360
July 2019	$0.45	$0.39	5,770,620

The closing price of the Choom Shares on June 2, 2020, being the last trading day prior to the announcement of the Arrangement Agreement, was $0.14 per Choom Share. The closing price of the Choom Shares on the CSE on August 4, 2020, being the last trading day on which the Choom Shares traded prior to the date of this Circular, was $0.11 per Choom Share.

H-9

Prior Sales

In the 12 month period prior to the date of this Circular, Choom issued the following securities.

Description of Security	Date Issued	Number of Securities Issued	Issuance/Exercise Price per Security
Convertible Secured Promissory Note re Bridge Loan	July 23, 2020	Aggregate Principal Amount of $500,000	Convertible into Choom Shares at a conversion price of $0.115/share
Choom Shares	April 1, 2020	22,126,066	$0.09
Choom Shares	March 10, 2020	10,000	$0.09
Stock Options	December 31, 2019	9,242,500	$0.165
Choom Shares	December 23, 2019	303,030	$0.165
Convertible Debenture Units (comprised of convertible debenture and warrants)	December 20, 2019	Aggregate Principal Amount of $4.1 million debentures 27,333,333 warrants	Debentures are convertible into Choom Shares at a conversion price of $0.15/share warrant exercise price of $0.20/share
Choom Shares	November 18, 2019	1,860,226	$0.2150
Stock Options	November 4, 2019	200,000	$0.235
Choom Shares	October 28, 2019	6,103,608	$0.49
Stock Options	October 7, 2019	300,000	$0.32
Units (comprised of one Choom Share and one-half of one warrant)	September 20, 2019	2,500,000 Choom Shares 1,250,000 warrants	$0.40 warrant exercise price of $0.60/share
Stock Options	September 10, 2019	300,000	$0.43

ESCROWED SECURITIES AND SECURITIES SUBJECT TO CONTRACTUAL RESTRICTIONS ON TRANSFER

As at the date hereof, there were 6,825,870 Choom Shares held in escrow as follows:

(a) 1,875,000 Choom Shares and, every six months, 1,875,000 Choom Shares are released;
(b) 172,500 Choom Shares held in escrow and, every six months, 86,250 Choom Shares are released;
(c) 3,000,000 Choom Shares and, every six months, 1,000,000 Choom Shares are released;
(d) 383,201 Choom Shares held in escrow and, every six months, 383,193 Choom Shares are released;
(e) 1,395,169 Choom Shares held in escrow and, every six months, 465,057 Choom Shares are released.

H-10

DIRECTORS AND OFFICERS

Name, Occupation and Security Holding

The following table and notes thereto sets forth, as at the date hereof, the name of each director and executive officer of Choom, the province and country in which he or she is ordinarily resident, all offices of Choom now held by such person, their respective principal occupations during the prior five preceding years, the time period for which he/she has been a director of Choom and the number of Choom Shares beneficially owned by him or her, directly or indirectly, or over which he or she exercises control or direction, as at the date hereof.

Name, Province and Country of Residence	Principal Occupation for 5 preceding years	Date First Became a Director	Number of Choom Shares Held
Chris Bogart British Columbia, Canada Director	President and Director of Choom	September 18, 2006	4,228,750
Stephen Tong British Columbia, Canada Director	Lawyer at Stella Law Corporation	February 23, 2016	180,000
Kevin Puil British Columbia, Canada Director	Chartered Financial Analyst Managing Partner at RIVI Capital LLC	May 17, 2017	24,000
Corey Gillon British Columbia, Canada Chief Executive Officer and Director	Chief Executive Officer of Choom since August 2019. Prior to that, Mr. Gillon was President of FirstService Residential BC, a private residentially property management company between March 2019 and August 2019; Senior Vice President, Retail of Aritzia, a publicly traded women’s fashion brand between March 2016 and December 2018; and Vice President, Ecommerce (Omnichannel) at Walmart eCommerce between October 2014 and January 2016	August 26, 2019	Nil

H-11

Name, Province and Country of Residence	Principal Occupation for 5 preceding years	Date First Became a Director	Number of Choom Shares Held
Terese Gieselman British Columbia, Canada Chief Financial Officer	Chief Financial Officer of Choom since September 2006; Management consultant to various public companies and President of Minco Corporate Management Inc.	N/A	175,000

Cease Trade Orders, Bankruptcies, Penalties or Sanctions

To the knowledge of Choom, no director or officer:

(a) is, at the date of this Circular, or has been, within 10 years before the date of this Circular, a director, chief executive officer (“ CEO ”) or chief financial officer (“ CFO ”) of any company (including Choom) that:
(i) was subject, to a cease trade or similar order or an order that denied the relevant company access to any exemptions under securities legislation, that was in effect for a period of more than 30 consecutive days (collectively, an “ Order ”); when such Order was issued while the person was acting in the capacity of a director, CEO or CFO of the relevant company; or
(ii) was subject to an Order for that was issued after such person ceased to be a director, CEO or CFO of the relevant company, and which resulted from an event that occurred while that person was acting in the capacity as director, CEO or CFO of the relevant company; or
(b) is, as at the date of this Circular, or has been within 10 years before the date of the Circular, a director or executive officer of any company (including Choom) 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
(c) has, within the 10 years before the date of this Circular, 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; or
(d) has been subject to 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

H-12

(e) has been subject to any penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable securityholder in deciding whether to vote for a proposed director.

Executive Compensation

For information concerning Choom’s executive compensation, see Choom’s 2019 Information Circular which is incorporated by reference herein.

LEGAL PROCEEDINGS AND REGULATORY ACTIONS

Choom is not, and was not during the most recently completed financial year, or from the end of the most recently completed financial year to the date of this Circular, a party to, nor was any of its property the subject of, any legal proceedings or regulatory actions material to Choom, and no such proceedings or actions are known to be contemplated.

INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS

Except as disclosed in the documents incorporated by reference herein, or as otherwise disclosed in the Circular, Choom is not aware of any material interest of any director or executive officer, any person that beneficially owns, or controls or directs, directly or indirectly, more than 10% of the Choom Shares, or any associate or affiliate of the foregoing , in any transaction within the three years before the date of this Circular that has materially affected or is reasonably expected to materially affect Choom.

TRANSFER AGENT AND REGISTRAR AND AUDITOR

Choom’s registrar and transfer agent for the Choom Shares is Computershare at its principal office in Vancouver, British Columbia.

Smythe LLP have been Choom’s independent auditors since September 1, 2015.

MATERIAL CONTRACTS

Except for contracts made in the ordinary course, and in addition to the material contracts of Choom disclosed in the documents incorporated by reference herein, the following are the only material contracts entered into by Choom before the date of this Circular, that are still in effect:

(a) Arrangement Agreement - for a description of the material terms and conditions of the Arrangement Agreement, please see the Circular of which this Appendix “H” forms a part under the heading “ Information Concerning the Arrangement – the Arrangement Agreement ”.
(b) Amended and Restated Convertible Debenture - On June 24, 2020, Choom issued a secured convertible amended and restated debenture in the principal amount of $20,000,000 to an arm’s length lender.

H-13

(c) 2019 Convertible Debentures - On December 23, 2019, Choom issued secured convertible debentures in the aggregate principal amount of $4,100,000 to arm’s length and nonarm’s length lenders.

INTERESTS OF EXPERTS

Names of Experts

The following are the persons or companies who were named as having prepared or certified a statement, report or valuation in this Circular 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:

Smythe LLP, Choom’s independent auditors, has prepared an independent audit report dated October 28, 2019 in respect of the Choom’s audited consolidated financial statements for the year ended June 30, 2019.

Interests of Experts

Smythe LLP, auditors of Choom, have confirmed that they are independent of Choom within the meaning of the ‘Rules of Professional Conduct’ of the Institute of Chartered Accountants of British Columbia.

RISK FACTORS

The following risks should be carefully considered when deciding whether to make an investment in Choom and the Choom Shares. Some of the following factors are interrelated and, consequently, investors should treat such risk factors as a whole. These risks and uncertainties are not the only ones that could affect Choom and the Choom Shares, and additional risks and uncertainties not currently known to Choom, or that it currently considers not to be material, may also impair the business, financial condition and results of operations of Choom and/or the value of the Choom Shares. If any of the following risks or other risks occur, they could have a material adverse effect on Choom business, financial condition and results of operations and/or the value of the Choom Shares. There is no assurance that any risk management steps taken by Choom will avoid future loss due to the occurrence of the risks described below or other unforeseen risks. In addition, if the Arrangement is completed, Phivida will be a whollyowned subsidiary of Choom, and the risk factors applicable to Phivida will continue to be applicable. See “ Risk Factors ” in Appendix “G” of the Circular for a description of the risk factors applicable to Phivida.

Risks Related to COVID-19

As of the date of this Circular, markets, governments and health organizations around the world are working to contain the outbreak of the novel coronavirus, which causes coronavirus disease (COVID-19). COVID-19 may present a wide range of potential issues or complications Choom, most of which we are not yet able to know the full extent of. The following are potential risks relating to the disruption of our business:

disruptions to business operations resulting from quarantines of employees and third party service providers;
disruptions to business operations resulting from travel restrictions; and

H-14

uncertainty around the duration and severity of the virus’ impact.

At this time it is unclear as to whether COVID-19 will represent a material disruption to Choom’s business, but a significant outbreak in the United States and Canada could result in a widespread health crisis that could further adversely affect our economies and financial markets, resulting in an economic downturn that could affect financing opportunities and demand for the products Choom distributes which could negatively impact, among other things, our liquidity and operating results.

Risk of Retail Store Operations

Growth of Choom’s retail network depends, among other things, on Choom’s ability to secure desirable locations on terms acceptable to Choom. Choom faces competition for retail locations from its competitors and from operators of other businesses. The success of many retail locations is significantly influenced by location. There can be no assurance that Choom’s retail locations will continue to be attractive, or that additional retail storefronts can be located and secured as demographic and traffic patterns change. Also, there is no guarantee that the property leases in respect of prospective retail locations can be established on terms acceptable to Choom, or at all, and that property leases in respect of existing retail locations will be renewed or that suitable alternative locations can be obtained. It is possible that the locations or economic conditions where retail locations are located could decline in the future, resulting in reduced sales in those locations. There is no assurance that future sites will produce the same results as past sites.

Cannabis Supply Shortage

As a result of the national cannabis supply shortage, on November 23, 2018, AGLC in Alberta announced its decision to temporarily suspend accepting applications and issuing any additional cannabis retail licenses until further notice. As the reliability of Alberta’s cannabis supply began to improve following the implementation of the AGLC’s retail cannabis licensing moratorium, the AGLC temporarily lifted the moratorium to issue 10 additional retail licenses in January 2019 and an additional 26 retail licenses in April 2019. On May 30, 2019 the AGLC lifted the moratorium on accepting new retail cannabis license applications and issuing new retail cannabis licenses. Supply shortages may significantly impact Choom’s licensed retail cannabis locations ability to procure sufficient cannabis product. Prolonged shortages may significantly impact revenues and operating margins.

Additional Financing

Choom requires additional financing to meet its business objectives. Choom’s ability to obtain additional financing, if and when required, will depend on investor demand, operating performance, the condition of the capital markets and other factors. If Choom raises additional funds through the issuance of equity, equity-linked or debt securities, those securities may have rights, preferences, or privileges senior to the rights of holders of the Choom Shares, and existing holders of such shares may experience dilution.

Tax Consequences

The Clarity and Niagara acquisitions described herein, including but not limited to the acquisition, ownership and disposition of the Choom Shares may have tax consequences in Canada, or elsewhere, depending on each particular existing or prospective shareholder’s specific circumstances. Such tax consequences are not described herein and disclosure is not intended to be, nor should it be construed

H-15

to be, legal or tax advice to any particular shareholder. Existing and prospective shareholders should consult their own tax advisors with respect to any such tax considerations.

Lease Risks

The retail store locations are primarily located on property that is not owned by Choom or its subsidiaries. Such property is subject to a long-term lease and similar arrangements in which the underlying land is owned by a third party and leased to Choom’s subsidiaries. Under the terms of a typical lease, the lessee must pay rent for the use of the land and is generally responsible for all costs and expenses associated with the building and improvements. Unless the lease term is extended, the land, together with all improvements made, will revert to the owner of the land upon the expiration of the lease term. In addition, an event of default by Choom’s subsidiaries under the terms of the lease could also result in a loss of the property should the default not be rectified in a reasonable period of time. The reversion or loss of such properties could have a material adverse effect on Choom and its subsidiaries’ operations and results.

Holding Company Status

Choom is largely a holding company and essentially all of its operating assets are the capital stock of its subsidiaries. As a result, investors in Choom are subject to the risks attributable to its subsidiaries. As a holding company, Choom conducts substantially all of its business through its subsidiaries, which generate substantially all of its revenues. Consequently, Choom’s cash flows and ability to complete current or desirable future enhancement opportunities are dependent on the earnings of its subsidiaries and the distribution of those earnings to Choom. The ability of these entities to pay dividends and other distributions will depend on their operating results and will be subject to applicable laws and regulations which require that solvency and capital standards be maintained by such companies and contractual restrictions contained in the instruments governing their debt. In the event of a bankruptcy, liquidation or reorganization of any of Choom’s subsidiaries, holders of indebtedness and trade creditors will generally be entitled to payment of their claims from the assets of those subsidiaries before any assets are made available for distribution to Choom.

Limited Operating History

Choom is subject to many of the risks common to early-stage enterprises, including limitations with respect to personnel, financial, and other resources and lack of revenues. There is no assurance that Choom will be successful in achieving a return on its shareholders’ investments and the likelihood of success must be considered in light of its early stage of operations.

Management of Growth

Choom may be subject to growth-related risks including capacity constraints and pressure on its internal systems and controls. The ability of Choom to manage growth effectively will require continued implementation and improvement of its operational and financial systems and to expand, train and manage its employee base. The inability of Choom to deal with growth may have a material adverse effect on its business, financial condition, results of operations and prospects.

H-16

Reliance on Management

The success of Choom is dependent upon the ability, expertise, judgment, discretion and good faith of its senior management. While employment agreements and incentive programs are customarily used as primary methods of retaining the services of key employees, these agreements and incentive programs cannot assure the continued services of such employees. Any loss of the services of such individuals could have a material adverse effect on Choom’s business, operating results or financial condition.

Litigation

Choom may become party to litigation from time to time in the ordinary course of its business which could adversely affect its operations. Should any litigation in which Choom becomes involved be determined against it, such a decision may adversely affect Choom’s ability to continue operating, adversely affect the market price of Choom Shares and use significant resources. Even if Choom is involved in litigation and succeeds, litigation can redirect significant company resources. Litigation may also create a negative perception of Choom’s brand.

Dividends

Choom’s policy is to retain earnings to finance the development and enhancement of its products and to otherwise reinvest in Choom’s businesses. Therefore, Choom does not anticipate paying cash dividends on Choom Shares in the foreseeable future. Any decision to declare and pay dividends in the future will be made at the discretion of the Board of Choom and will depend on, among other things, financial results, cash requirements, contractual restrictions and other factors that the Board of Choom may deem relevant. As a result, investors may not receive any return on investment in the Choom Shares unless they sell them for a share price that is greater than that at which such investors purchased them.

Limited Market for Securities

There can be no assurance that an active and liquid market for the Choom Shares will be maintained and an investor may find it difficult to resell any securities of Choom.

The Size of Choom’s Target Market is Difficult to Quantify, and Investors will be Reliant on their Own Estimates on the Accuracy of Market Data

Because the cannabis industry is in a nascent stage with uncertain boundaries, there is a lack of information about comparable companies available for potential investors to review in deciding about whether to invest in Choom and, few, if any, established companies whose business model Choom can follow or upon whose success Choom can build. Accordingly, investors will have to rely on their own estimates in deciding about whether to invest in Choom. There can be no assurance that Choom’s estimates are accurate or that the market size is sufficiently large for its business to grow as projected, which may negatively impact its financial results. Choom regularly purchases and follows market research.

Liquidity Risk

Choom’s ability to remain liquid over the long term depends on its ability to obtain additional financing. Choom has in place planning and budgeting processes to help determine the funds required to support normal operating requirements on an ongoing basis as well as its planned development and capital

H-17

expenditures. Choom’s approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet liabilities when due.

Conflicts of Interest

Choom may be subject to various potential conflicts of interest because some of their officers and directors may be engaged in a range of business activities. In addition, Choom’s executive officers and directors may devote time to their outside business interests, so long as such activities do not materially or adversely interfere with their duties to either company. In some cases, Choom’s executive officers and directors may have fiduciary obligations associated with these business interests that interfere with their ability to devote time to Choom’s business and affairs and that could adversely affect Choom’s operations. These business interests could require significant time and attention of Choom’s executive officers and directors.

In addition, Choom may also become involved in other transactions which conflict with the interests of its directors and the officers who may from time to time deal with persons, firms, institutions or Companies with which Choom may be dealing, or which may be seeking investments similar to those desired by it. The interests of these persons could conflict with those of Choom. In addition, from time to time, these persons may be competing with Choom for available investment opportunities. Conflicts of interest, if any, will be subject to the procedures and remedies provided under applicable laws. In particular, if such a conflict of interest arises at a meeting of Choom’s directors, a director who has such a conflict will abstain from voting for or against the approval of such participation or such terms. In accordance with applicable laws, the directors of Choom are required to act honestly, in good faith and in the best interests of their respective companies.

Regulatory Risks

Choom’s business is contingent, in part, upon compliance with regulatory requirements enacted by governmental authorities and obtaining all regulatory approvals, where necessary, for the operation of its business. The cannabis industry is a new industry and Choom cannot predict the impact of the changes to the compliance regime. Similarly, Choom cannot predict the time required to secure all appropriate regulatory approvals for its business, or the extent of documentation that may be required by governmental authorities. The impact of cannabis regulatory compliance regime, any delays in obtaining, or failure to obtain regulatory approvals may significantly delay or impact the development of markets, products, and sales initiatives and could have a material adverse effect on the business, financial condition, and operating results of Choom.

Choom will incur ongoing costs and obligations related to regulatory compliance. Failure to comply with regulations may result in additional costs for corrective measures, penalties, or in restrictions on Choom’s operations. In addition, changes in regulations, more vigorous enforcement thereof, or other unanticipated events could require extensive changes to Choom’s operations, increased compliance costs, or give rise to material liabilities, which could have a material adverse effect on the business, financial condition, and operating results of Choom.

Changes in government levies, including taxes, could reduce Choom’s earnings and could make future capital investments or Choom’s operations uneconomic. The industry is also subject to numerous legal

H-18

challenges, which may significantly affect the financial condition of market participants and which cannot be reliably predicted.

Government Regulations

Choom’s operations are subject to governmental laws or regulations promulgated by various legislatures or governmental agencies from time to time. A breach of such legislation may result in imposition of fines and penalties. The cost of compliance with changes in governmental regulations has a potential to reduce the profitability of operations. Choom intends to fully comply with all governmental laws and regulations. There can be no assurance, however, that all permits which Choom may require for its operations and activities will be obtainable on reasonable terms or on a timely basis or such laws and regulations would not have an adverse effect on Choom’s business.

Competition

The impact of any developments in cannabis legislation and regulation may be negative for Choom and could result in increased levels of competition in its existing medical market and/or the entry of new competitors in the retail cannabis market in which Choom will operate.

There is potential that Choom will face intense competition from other companies, some of which can be expected to have more financial resources, industry, manufacturing and marketing experience than Choom. Additionally, there is potential that the industry will undergo consolidation, creating larger companies that may have increased geographic scope and other economies of scale. Increased competition by larger, better-financed competitors with geographic or other structural advantages could materially and adversely affect the business, financial condition and results of operations of Choom.

Because of the early stage of the industry in which Choom operates, Choom expects to face additional competition from new entrants. To remain competitive, Choom will require a continued level of investment in research and development, marketing, sales and client support. Choom 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 the business, financial condition and results of operations of Choom.

Operating Risk and Insurance Coverage

Choom has insurance to protect its assets, operations and employees. While Choom believes its insurance coverage addresses all material risks to which they are exposed and is adequate and customary in its current state of operations, such insurance is subject to coverage limits and exclusions and may not be available for the risks and hazards to which Choom is exposed. However, Choom may also be unable to maintain insurance to cover these risks at economically feasible premiums. Insurance coverage may not continue to be available or may not be adequate to cover any resulting liability. Losses from these events may cause Choom to incur significant costs that could have a material adverse effect upon Choom’s financial performance and results of operations.

Choom could be liable for fraudulent or illegal activity by its employees, contractors and consultants resulting in significant financial losses to claims against Choom. Choom is exposed to the risk that its employees, independent contractors and consultants may engage in fraudulent or other illegal activity. Misconduct by these parties could include intentional, reckless and/or negligent conduct or disclosure of

H-19

unauthorized activities to Choom that violates: (i) government regulations; or (ii) laws that require the true, complete and accurate reporting of financial information or data. It is not always possible for Choom to identify and deter misconduct by its employees and other third parties, and the precautions taken by Choom to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting Choom 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 Choom, and it is not successful in defending itself or asserting its rights, those actions could have a significant impact on Choom’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 Choom’s operations, any of which could have a material adverse effect on Choom’s business, financial condition and results of operations.

Choom will be reliant on information technology systems and may be subject to damaging cyber-attacks. Choom has entered into agreements with third parties for hardware, software, telecommunications and other information technology (“IT”) services in connection with its operations. Choom’s operations depend, in part, on how well it and its suppliers 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, vandalism and theft. Choom’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 Choom’s reputation and results of operations.

Choom has not experienced any material losses to date relating to cyber-attacks or other information security breaches, but there can be no assurance that Choom will not incur such losses in the future. Choom’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, Choom may be required to expend additional resources to continue to modify or enhance protective measures or to investigate and remediate any security vulnerabilities.

Risks Inherent in the Nature of the Health Clinic Industry

Changes in operating costs (including costs for maintenance and insurance), inability to obtain permits required to conduct Choom’s medical cannabis business, changes in health care laws and governmental regulations and various other factors may significantly impact the ability of Choom to generate revenues from its medical cannabis business. Certain significant expenditures, including legal fees, borrowing costs, maintenance costs, insurance costs, and related charges must be made to conduct its medical cannabis business, regardless of whether Choom is generating revenue.

Forecast Uncertainties

Choom will need to rely largely on its own market research to forecast sales as detailed forecasts are not generally obtainable from other sources at this early stage of the medical and retail cannabis industry in Canada. A failure in the demand for its business to materialize as a result of competition, technological

H-20

change or other factors could have a material adverse effect on the proposed investments, business, results of operations, and financial condition of Choom.

Reputational Risk

Damage to Choom’s reputation can be the result of the actual or perceived occurrence of any number of events, and could include any negative publicity, whether true or not. 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 opinions and views in regards to Choom and its activities, whether true or not. Although Choom believes that it operates in a manner that is respectful to all shareholders and that it takes care in protecting its image and reputation, Choom does not ultimately have direct control over how it is perceived by others. Reputation loss may result in decreased investor confidence, increased challenges in developing and maintaining community relations, and an impediment to Choom’s overall ability to advance its projects, thereby having a material adverse impact on financial performance, financial condition, cash flows, and growth prospects.

Cannabis Prices

The price of Choom’s shares and its financial results may be significantly and adversely affected by a decline in the price of cannabis. There is currently no established market price for cannabis and the price of cannabis is affected by several factors beyond Choom’s control. Choom’s profitability may be directly related to the price of cannabis. Choom’s operating income maybe sensitive to changes in the price of cannabis and the overall condition of the cannabis industry as its operating income will be derived from the sale of cannabis.

H-21

INFORMATION ABOUT CHOOM FOLLOWING COMPLETION OF THE ARRANGEMENT

The following is a summary of Choom following completion of the Arrangement, including its business and operations, which should be read in conjunction with the information concerning Choom appearing in this Schedule “H” to the Circular, as well as information concerning Phivida appearing in Schedule “G” to the Circular.

Following the completion of the Arrangement, Choom will continue to be a reporting issuer in the Provinces of British Columbia, Alberta, Ontario and New Brunswick, and will be subject to the continuous disclosure reporting requirements under the securities laws of such jurisdictions. Upon or following completion of the Arrangement:

(a) Choom will own all of the Phivida Shares;
(b) former Phivida Shareholders will become Choom Shareholders;
(c) the Choom Shares are expected to continue to trade on the CSE;
(d) the Phivida Shares will be de-listed from the CSE and Phivida is expected to cease to be a reporting issuer.

The Arrangement will result in Phivida becoming a wholly-owned subsidiary of Choom. The assets and operations of Phivida at the Effective Time will become the assets and operations of Choom, through its ownership of Phivida.

Name, Address and Incorporation

Following the completion of the Arrangement, each of Choom will continue to be governed by the laws of the BCBCA. Choom will, immediately following the Effective Time, directly own all of the outstanding Phivida Shares and Phivida will be a wholly-owned subsidiary of Choom. The registered and records office of Choom will continue to be located at #208 – 1525 West 9[th] Avenue, Vancouver, BC V6J 1T5.

Intercorporate Relationships

Following the completion of the Arrangement, Choom will directly own all of the issued and outstanding Phivida Shares. Accordingly, Choom will own and hold, directly or indirectly, all of the property of Phivida and all rights, contracts, permits and interests of Phivida.

Description of the Business of Choom Following Completion of the Arrangement

Following the completion of the Arrangement, Choom expects that it will carry on the business it had conducted prior to the Arrangement, while leveraging Phivida’s current assets, to accelerate the build-out of additional stores in Ontario and British Columbia. Choom expects that the acquisition of Phivida will provide it with blue-chip retail and branded product capabilities, digital and online expertise, countrywide geographical representation and an aligned entrepreneurial spirit committed to creating one of the dominant national cannabis retailers in Canada. Choom expects to leverage Phivida’s digital assets and capabilities to enhance growth and consumer experiences in its retail stores by utilizing Phivida’s

H-22

e-commerce solutions and content-rich marketing platforms. Choom also expects to benefit from a broader shareholder base, which Choom expects will provide it with strengthened access to growth capital.

Choom may also, in its discretion, modify or discontinue certain aspects of Phivida’s business, or reorganize the business in order to integrate Phivida’s business into Choom’s operations. Following completion of the Arrangement, Choom does not expect to continue Phivida’s product businesses, and may seek value enhancing transactions or other opportunities with aspects of Phivida’s business that are not aligned with Choom’s strategic business direction.

Dividends and Distributions Following Completion of the Arrangement

No change is expected to be made to Choom’s approach to dividends and distributions following completion of the Arrangement. For a description of Choom’s approach to dividends and distributions, please see “ Dividends and Distributions ” above.

Pro Forma Consolidated Capitalization

For a description of the consolidated capitalization of Choom, both before and on a pro forma basis after completion of the Arrangement, please see “ Consolidated Capitalization ” above.

Selected Unaudited Pro Forma Financial Information

The following selected unaudited pro forma consolidated financial information for Choom, giving effect to the Arrangement and related steps, is based on the assumptions and adjustments described in the respective notes to the Choom unaudited pro forma consolidated statement of financial position as at March 31, 2020 attached as Schedule 1 to this Appendix "H" to the Circular. The unaudited pro forma consolidated statement of financial position has been prepared based on the assumption that, among other things, the Arrangement occurred on March 31, 2020. The unaudited pro forma consolidated financial statements are not necessarily indicative of Choom's consolidated financial position and results from operations if the events reflected therein were in effect for the periods presented, nor do they purport to project Choom's consolidated financial position or results from operations for any future period.

The selected unaudited pro forma consolidated financial information given below should be read in conjunction with the description of the Arrangement contained in this Circular, the unaudited pro forma consolidated financial statements contained in Schedule 1 to this Appendix "H" to the Circular and the audited and unaudited consolidated financial statements of Choom incorporated by reference in this Circular.

ExpressedinCanadian Dollars
	Choom	Phivida
	Holdings Inc. as	Holdings Inc.
	at March 31,	as at March	Pro Forma	Pro Forma Choom
	2020	31, 2020	Adjustments	Holdings Inc.
Cash and cash equivalents	658,327	3,665,778		4,324,105
Total Assets	36,607,616	7,113,379		45,624,953
Total Liabilities	32,345,884	868,848	(1,090,692)	34,305,424
Shareholders’ Equity	4,261,732	6,244,531	(813,306)	11,319,569

H-23

Description of Capital Structure Following Completion of the Arrangement

The completion of the Arrangement will not affect the authorized capital of Choom. The authorized share capital of Choom following the completion of the Arrangement will continue to consist of an unlimited number of Choom Shares. The rights attaching to the Choom Shares will continue to be the same as those prior to the completion of the Arrangement. For a description of the rights attaching to the Choom Shares, please see “ Description of Capital Structure ” above.

Market for Securities Following Completion of the Arrangement

Upon completion of the Arrangement, the Choom Shares will continue to be listed for trading on the CSE under the symbol “CHOO”. Following completion of the Arrangement, Choom intends to have the Phivida Shares delisted from the CSE and for Phivida to cease to be a “reporting issuer” in all of the Provinces in which it is a “reporting issuer”. For a description of the trading price and volume of Choom Shares, as well as prior sales, please see “ Market for Securities ” above.

Directors and Officers of Choom Following the Arrangement

Upon completion of the Arrangement, the Choom Board will consist of three nominees of Choom, which are anticipated to chosen among existing directors of Choom , and one nominee of Phivida, which is anticipated to be one of the current directors of Phivida. In addition, within a reasonable period of time following the completion of the Arrangement, the Choom Board will be reconstituted to add an additional director that shall be jointly nominated by Choom and Phivida. See “ Directors and Officers ” in this Appendix “H” for information on the current directors of Choom and “ Information concerning the Meeting - Election of Directors of Phivida ” in the Circular for information on the current directors of Phivida.

Upon completion of the Arrangement, it is anticipated that the directors and executive officers of Choom will collectively beneficially own, directly or indirectly, or will have control or direction over 4,607,750 Choom Shares (representing approximately 1.6% of the issued and outstanding Choom shares on a nondiluted basis upon completion of the Arrangement).

Principal Securityholders of Choom Following the Arrangement

To the best knowledge of the directors and officers of Choom and Phivida, upon completion of the Arrangement, no person is expected to beneficially own, directly or indirectly or exercise control or direction over, more than 10% of the issued and outstanding Choom Shares.

Executive and Director Compensation

Following the completion of the Arrangement, no material changes are expected to occur to the policies of Choom regarding executive and director compensation.

H-24

Risk Factors Following Completion of the Arrangement

If the Arrangement is completed, Choom will continue to face many of the risks that it currently faces, and will also through its ownership of Phivida face many of the risks that Phivida currently faces, in each case with respect to each of Choom’s and Phivida’s respective business and affairs. For information concerning the risks faced by Phivida with respect to its business and affairs, please see “ Additional Information Concerning Phivida – Risk Factors ” in Appendix “G” to the Circular. For information concerning the risks faced by Choom with respect to its business and affairs, please see “ Risk Factors ” above.

Auditor

Following completion of the Arrangement, it is expected that the independent auditors of Choom will continue to be Smythe LLP.

Registrar and Transfer Agent

Following completion of the Arrangement it is expected that the transfer agent and registrar of the Choom Shares will continue to be Computershare, at its principal office in Vancouver, British Columbia.

ADDITIONAL INFORMATION

Additional information relating to Choom is available through the internet on the Canadian System for Electronic Document Analysis and Retrieval (SEDAR) which can be accessed at www.sedar.com. Additional information, including directors’ and officers’ remuneration and indebtedness, principal holders of Choom’s securities and securities authorized for issuance under equity compensation plans, if applicable, is contained in Choom’s information circular for its most recent annual meeting of shareholders that involved the election of directors. A copy of which is available on SEDAR. Additional financial information concerning Choom is provided in the Choom’s financial statements and corresponding MD&A for its most recently completed financial year, copies of which are available on SEDAR.

H-25

Schedule “1”

==> picture [163 x 68] intentionally omitted <==

CHOOM HOLDINGS INC�

PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS

H-26

==> picture [163 x 68] intentionally omitted <==

CHOOM HOLDINGS INC�

PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS

INDEX

Pro Forma Consolidated Statement of Financial Position H-27
� Pro Forma Consolidated Statement of Loss and Comprehensive Loss H-28-29 � Notes to the Pro Forma Consolidated Financial Statements H-30-32

H-27

CHOOM HOLDINGS INC.

UNAUDITED PROFORMA CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at March 31, 2020

Expressed in Canadian Dollars

As at March 31, 2020 ExpressedinCanadian Dollars
		Phivida
	Choom Holdings	Holdings Inc. as
	Inc. as at March	at March 31,	Pro Forma		Pro Forma Choom
	31, 2020	2020	Adjustments	Note	Holdings Inc.
ASSETS
Current
Cash and cash equivalents	658,327	3,665,778	-		4,324,105
Marketable securities	400	-	-		400
Short-term investments	46,000	-	-		46,000
Trade and accounts receivable	801,973	212,931	-		1,014,904
Inventory	1,092,552	729,419	(335,509)	3d	1,486,462
Notes receivable	900,000	-	-		900,000
Prepaid expenses and deposits	916,485	150,735			1,067,220
	4,415,737	4,758,863	(335,509)		8,839,091
Non-Current
Long term lease deposits	669,857	-	-		669,857
Loans receivable	172,282	-	-		172,282
Other assets	1,050,000	331,070	-		1,381,070
Property and equipment	9,948,379	29,639	-		9,978,018
Right of use assets	10,295,137	102,261	(102,261)	3e	10,295,137
Intangible assets	5,506,746	1,891,546	2,341,768	3f	9,740,060
Investment	1,732,665	-	-		1,732,665
Notes receivable and deposits	1,843,763	-	-		1,843,763
Goodwill	973,050	-	-		973,050
	36,607,616	7,113,379	1,903,998		45,624,993
LIABILITIES
Current
Lease Liabilities	1,797,945	23,402	(23,402)	3e	1,797,945
Trade and other payables	4,680,668	762,994	1,114,094	3g	6,557,756
Advancesfromshareholders	4,000	-	-		4,000
	6,482,613	786,396	1,090,692		8,359,701
Non-Current
Lease liabilities	8,507,637	82,452	-		8,590,089
Convertible debenture	17,355,634	-	-		17,355,634
	32,345,884	868,848	1,090,692		34,305,424
SHAREHOLDERS' EQUITY
Share capital	119,007,062	38,276,818	(38,276,818)	3a	126,307,789
			7,300,727	3b
Obligation to issue shares	1,157,849	-	-		1,157,849
Equity portion of convertible debenture	5,942,722	-	-		5,942,722
Contributed surplus	8,324,547	6,579,626	(6,579,626)	3a	8,597,485
			272,938	3c
Accumulated other comprehensive income	-	59,905	(59,905)	3a	-
Accumulated Deficit	(130,170,448)	(38,671,818)	38,671,818	3a	(130,686,277)
			(515,829)
	4,261,732	6,244,531	813,306		11,319,569
	36,607,616	7,113,379	1,903,998		45,624,993

																										H-28	H-28	H-28
						Proforma Choom	Holdings Inc.		3,408,479	-	458,488	3,886,967		(2,426,604)	-	(154,133)	(7,468)	1,278,762		6,169,816	4,311,798	608,440	805,732	37,160	1,787,384	1,517,361	(15,237,691)	(13,958,929)		305,170	200,000	315,301	(46,423)	(133)	(253,904)	(4,169,939)	(752,554)	(12,086,269)	(1,099,666)	(401,189)	(78,859)	3,030	(2,612,750)	(34,637,104)	(81,200)		89,622	(34,628,682)
									$																																							$
							Note			3h					3h																						3d				3e
						Proforma	Adjustments		-	(1,019,474)	-	(1,019,474)		-	918,013	-	-	(101,461)		-	-	-	-	-	-	-	-	(101,461)		-	-	-	-	-	-	-	(335,509)	-	-	-	(78,859)	-	-	(515,829)			-	(515,829)
CHOOM HOLDINGS INC.	UNAUDITED PROFORMA CONSOLIDATED STATEMENT OF LOSS AND COMPREHENSIVE LOSS	For the nine months ended March 31, 2020	Expressed in Canadian Dollars	Choom Holdings Phivida Holdings	Inc. nine months Inc. nine months	ended March 31, ended March 31,	2020 2020	Revenue	Recreational - Retail $ 3,408,479 -	Hemp Oils & Beverages - 1,019,474	Clinic services 458,488 -	Total revenue 3,866,967 1,019,474	Cost of sales	Recreational - Retail (2,426,604) -	Hemp Oils & Beverages - (918,013)	Doctor and coaching fees (154,133) -	Medical supplies (7,468) -	Gross profit 1,278,762 101,461	Expenses	Administrative and general 4,252,020 1,917,796	Salary, wages, benefits 1,990,926 2,320,872	Depreciation and amortization 273,539 334,901	Right of use asset depreciation 792,534 13,198	Foreign exchange 4,332 32,828	Marketing, website and media design 562,764 1,224,620	Share-based payments 906,059 611,302	(8,782,174) (6,455,517)	Loss before other items (7,503,412) (6,354,056)	Other items	Interest income 223,505 81,665	Licensing income 200,000 -	Rental income 315,301 -	Loss on sale of marketable securities (46,423) -	Loss on fair value of marketable securities (133) -	Loss on write-off of note receivable (253,904) -	Impairment on development permits (4,169,939) -	Impairment on inventory - (417,035)	Impairment of goodwill - (12,086,269)	Impairment of investment in associate - (1,099,666)	Write-off of property and equipment (401,189) -	Impairment on right of use assets - -	Gain on settlement of debt 3,030 -	Financing costs (2,612,750) -	Loss from continuing operations (14,245,914) (19,875,361)	Loss from discontinued operations (81,200)	Other comprehensive Income	Foreign currency translation of foreign operations - 89,622	Net loss and comprehensive loss $ (14,327,114) (19,785,739)

H-29

Choom Holdings Inc. year ended June 30, 2019 Phivida Holdings Inc. twelve months ended June 30, 2019 Proforma Adjustments Note Proforma Choom Holdings Inc.	Revenue Hemp Oils & Beverages $ - 123,643 (123,643) 3h $ - Clinic services 268,321 - - 268,321	Total revenue 268,321 123,643 (123,643) 268,321	Cost of sales Recreational - Retail - - Hemp Oils & Beverages - (34,661) 34,661 3h - Doctor and coaching fees (151,491) - - (151,491) Medical supplies (5,495) - - (5,495)	Gross profit 111,335 88,982 (88,982) 111,335	Expenses Administrative and general 6,619,610 3,109,129 - 9,728,739 Salary, wages, benefits 278,325 1,759,411 - 2,037,736 Depreciation and amortization 10,208 10,359 - 20,567 Foreign exchange 20,003 (230) - 19,773 Application and termination of agreements costs 583,752 - - 583,752 Marketing, website and media design 1,483,822 2,457,615 - 3,941,437 Share-based payments 3,453,119 2,957,865 - 6,410,984	(12,448,839) (10,294,149) - (22,742,988)	Loss before other items (12,337,504) (10,205,167) (88,892) (22,631,653)	Other items Interest income 153,315 228,020 - 381,335 Other income 113,202 - - 113,202 Rental income 124,997 - - 124,997 Loss on fair value of marketable securities (67) - - (67) Loss on write-off of note receivable (100,000) - - (100,000) Impairment on inventory - - (335,509) 3d (335,509) Impairment of goodwill - - - - Impairment of property and equipment (1,225) - - (1,225) Impairment of right of use assets - - (78,859) 3e (78,859) Financing costs (1,547,091) - - (1,547,091)	Loss before income tax (1,256,869) 228,020 (414,368) (1,443,217)	Deferred income tax recovery 2,163,285 - - 2,163,285	Loss from continuing operations (11,431,088) (9,977,147) (503,350) (21,911,585)	Loss from discontinued operations (89,720,697) - - (89,720,697)	(101,151,785) (9,977,147) (503,350) (111,632,282)	Other comprehensive Income Foreign currency translation of foreign operations - 83,502 83,502	Net loss and comprehensive loss $ (101,151,785) (9,893,645) (503,350) (111,548,780)

H-30

CHOOM HOLDINGS INC. NOTES TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (Expressed in Canadian Dollars)

1. Basis of Presentation

These unaudited pro forma consolidated financial statements have been prepared in connection with the proposed transaction wherein on June 2, 2020 Choom Holdings Inc. (“Choom”) and Phivida Holdings Inc. (“Phivida”) entered into definitive agreement (the “ Arrangement Agreement ”) pursuant to which Choom will acquire all of the issued and outstanding common shares of Phivida (the “ Phivida Shares ”) in exchange for common shares of Choom (the “ Choom Shares ”) in an arm’s length all-share transaction (the “ Transaction ”).

These unaudited pro forma consolidated financial statements have been prepared in connection with the proposed Transaction. In the opinion of the Choom’s management, the unaudited pro forma consolidated financial statements include all adjustments necessary for fair presentation of the transaction as described below.

These unaudited pro forma consolidated financial statements have been prepared in accordance with policies consistent with International Financial Reporting Standards (“IFRS”). The unaudited pro forma consolidated financial statements have been prepared from, and should be read in conjunction with, the following historical information prepared in accordance with IFRS and applicable securities regulations:

i. the audited financial statements of Choom as at and for the year ended June 30, 2019 and 2018.
ii. the unaudited financial statements of Choom as at and for the nine months ended March 31, 2020 and 2019;
iii. the unaudited financial statements of Phivida as at and for the six months ended March 31, 2020;
iv. the audited financial statements of Phivida as at and for the year ended September 30, 2019 and 2018; and
v. the unaudited financial statements of Phivida as at and for the nine months ended June 30, 2019 and 2018;

The unaudited pro forma consolidated statement of financial position as at March 31, 2020 has been prepared as if the Transaction described in Note 2 and pro forma adjustments and assumptions described in Note 3 had occurred on March 31, 2020. The unaudited pro forma consolidated statement of loss and comprehensive loss for the nine months ended March 31, 2020 and for the year ended June 30, 2019 have been prepared as if the Transaction described in Note 2 had occurred on July 1, 2018. The unaudited pro forma consolidated financial statements may not be indicative of the results that actually would have occurred if the events reflected therein had been in effect on the dates indicated or the results which may be obtained in the future. In preparing these unaudited pro forma consolidated financial statements no adjustments have been made to reflect the operating synergies and administrative cost savings that could result from the operations of the combined assets.

Accounting policies used in the preparation of the unaudited pro forma consolidated financial statements are in accordance with those disclosed in the audited financial statements of Choom as at and for the year ended June 30, 2019 which are consistent with Phivida’s accounting policies. In the opinion of management these unaudited pro forma consolidated financial statements include all the necessary adjustments for a fair presentation of the ongoing entity.

Certain elements of the financial statements of Choom and Phivida have been reclassified to provide a consistent format.

H-31

CHOOM HOLDINGS INC. NOTES TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (Expressed in Canadian Dollars)

2. Acquisition

Pursuant to the Arrangement Agreement Choom will acquire all the issued and outstanding common shares of Phivida, wherein Phivida shareholders will receive 0.72566 of a Choom Share in exchange for each Phivida Share held (the “ Exchange Ratio ”) based on $0.082 per Phivida Share, representing a 10% premium to the 20-day volume weighted average price of the Phivida Shares ending June 2, 2020, and based on a 20-day volume weighted average price of the Choom Shares for the same period, being $0.113 per Choom Share.

The Transaction will be effected by way of a court-approved plan of arrangement completed under the Business Corporations Act (British Columbia) and will require approval by at least 66 2/3% of the votes cast by the shareholders of Phivida at a special meeting of Phivida shareholders. In addition to shareholder approval, the Transaction is subject to applicable regulatory, court and Canadian Securities Exchange (“CSE”) approvals and certain other closing conditions customary in transactions of this nature.

The Transaction will be accounted for in accordance with the guidance provide in IFRS 2 – Share Based Payment and IFRS 3 – Business Combinations. As Phivida did not qualify as a business according to the definition in IFRS 3, the Transaction does not constitute a business combination rather its it treated as an issuance of shares by Choom for the net assets of Phivida. Phivida is listed on the CSE as such Choom and Phivida intend to apply to delist the common shares of Phivida from the CSE and Phivida will remain a wholly owned subsidiary of Choom.

For the purpose of the pro forma consolidated financial statements the fair value of the net assets of Phivida are estimated as follows:

Purchase Price Consideration Paid

Fair Value of 64,608,207 Choom shares issued	$ 7,300,727
Estimated fair value of 7,881,837 Phivida options	272,938
Estimated transaction costs	1,114,094
Total PurchasePrice	$ 8,687,759
Cash and cash equivalents	$ 3,665,778
Taxes recoverable and other receivables	212,931
Prepaids	150,735
Inventory	393,910
Property plant and equipment	29,639
Intangibles	4,666,690
Other assets	331,070
Trade and other payable	(762,994)
	$ 8,687,759

H-32

CHOOM HOLDINGS INC. NOTES TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (Expressed in Canadian Dollars)

2. Acquisition

The above amounts are estimates, which have been made by management of Choom for the acquisition, based on information available. Amendments to these amounts as values subject to estimate are finalized and to account for final balances at the time of closing. The total consideration of Phivida has been estimated based on an estimated value of approximately $0.113 per common share. The Transaction costs have been included in the deficit.

3. Pro Forma Assumptions and Adjustments

These unaudited pro forma consolidated financial statements incorporate the following pro forma assumptions:

a) Equity balances of Phivida are eliminated.
b) The total pro forma purchase price as described in Note 2 above results in a share capital increase of $7,300,727 which represents the fair value of Choom Shares issued to Phivida Shareholders to effect the Transaction.
c) The assumptions used to value the Phivida 7,881,837 outstanding options (pro-rata basis using the Exchange Ratio) for Choom options were:
a. Options - stock price of $0.10, an exercise price of $0.421 an expected life of 3.17 years, an interest rate without risk of 0.30%, no expected dividend yield and an estimated volatility of 100% which results in a pro forma fair value of $227,938.
d) The pro forma adjustment reflects the decrease in inventories to net realizable value.
e) The pro forma adjustment reflects the net impairment of right of use assets and lease liabilities for terminated lease.
f) The pro forma adjustment reflects the excess of the preliminary fair value of net assets acquired attributed to intangible assets acquired.
g) Accounts payable includes the estimated transactions costs of $1,114,094 which include, legal, accounting, filing fees, advisory fees and estimated employee severance costs.
h) The pro forma adjustment to revenues net costs of goods reflects the discontinuation of the sale of beverages and hemp oils on a forward-looking basis.

4. Pro Forma Share Capital

Pro forma share capital as at March 31, 2020 has been determined as follows:

	NumberofShares	Share Capital
Commonshares ofChoom issued and outstanding as atMarch31,2020	203,253,095	$119,007,062
Fair value of common shares issued to acquire Phivida	64,608,207	7,300,727
Pro Forma Share Capital	267,861,302	$126,307,790

5. Income Tax

The expected income tax rate applicable to the consolidate operations would be that of the local statutory rates of British Columbia which is 27%.

AI assistant

Phivida Holdings Inc. — Proxy Solicitation & Information Statement 2020

47409_rns_2020-08-12_49f6176b-65a1-4a1f-adf0-d93101278dff.pdf

NOTICE OF ANNUAL GENERAL AND SPECIAL MEETING

MANAGEMENT INFORMATION CIRCULAR

ANNUAL GENERAL AND SPECIAL MEETING OF SHAREHOLDERS

PHIVIDA HOLDINGS INC.

PHIVIDA HOLDINGS INC.

Voting

Letter of Transmittal

Concerns and Restrictions Relating to COVID-19

NOTICE OF ANNUAL GENERAL AND SPECIAL MEETING OF SHAREHOLDERS

BY ORDER OF THE BOARD OF DIRECTORS

QUESTIONS AND ANSWERS

Q:

Why is the Meeting being held?

Q:

When is the Meeting being held?

Q:

Who is entitled to vote at the Meeting?

Q: When can I expect to receive the consideration for Phivida Shares?

Q:

When do I have to vote my Phivida Shares by?

Q: How do I vote my Phivida Shares?

A:

Q: What are the benefits to Phivida Shareholders?

Q: What approvals are required by Phivida Shareholders at the Meeting?

Q: Do Phivida’s directors support the Arrangement?

Q: Are there Support and Voting Agreements?

Q: Is there a Fairness Opinion?

Q: When will the Plan of Arrangement become effective?

Q: Where will the shares of Choom be listed?

Q: Should I send in my Letter of Transmittal and certificate(s) or DRS Advice(s) representing by Phivida Shares now?

Q: Who do I contact if I have questions?

TABLE OF CONTENTS

INFORMATION CONTAINED IN THIS INFORMATION

INFORMATION CONTAINED IN THIS INFORMATION CIRCULAR

Information Contained in this Circular Regarding Choom

Cautionary Note Regarding Forward-Looking Statements and Risks

Note to United States Security Holders

Summary of Certain Canadian Federal Income Tax Considerations

Reporting Currency

GLOSSARY OF TERMS

“ Acquisition Proposal ”

“ Additional Shares ”

“ affiliate ”

“ Change in Recommendation ”

“ Consideration Shares ”

“ Court ”

“DTC”

“ Fairness Opinion ”

“ Final Order ”

“ Governmental Entity ”

“ Interim Order ”

“ Intermediary ”

“ Letter of Transmittal ”

“Material Adverse Effect ”

Entity;

“ Notice ”

“ Notice of Dissent ”

“ Supporting Shareholders ”

“ Termination Fee ”

“ U.S. Exchange Act ”

“ U.S. Securities Act ”

“VIF”

GENERAL PROXY INFORMATION

Solicitation of Proxies

Who can Vote?

Registered Phivida Shareholders

A REGISTERED PHIVIDA SHAREHOLDER HAS THE RIGHT TO APPOINT A PERSON (WHO NEED NOT BE A PHIVIDA SHAREHOLDER) TO ATTEND AND ACT FOR HIM, HER OR IT ON HIS, HER OR ITS BEHALF AT THE

Voting of Shares and Exercise of Discretion of Proxies

Non-Registered Holders

The information set forth in this section is of significant importance to many Phivida Shareholders as a substantial number of Phivida Shareholders do not hold Phivida Shares in their own name.

Voting Shares and Principal Holders Thereof

INFORMATION CONCERNING THE MEETING

General Information

permitted. Accordingly, we encourage you not to plan to attend the Meeting in person and instead ensure you vote by proxy.

Receipt of the Phivida Audited Financial Statements

Election of Directors of Phivida

Biographies of Proposed Phivida Directors Who Have Not Previously Been Elected

Phivida Holdings Inc. Proxy Solicitation & Information Statement 2020