<SEC-DOCUMENT>0001628280-26-013637.txt : 20260303
<SEC-HEADER>0001628280-26-013637.hdr.sgml : 20260303
<ACCEPTANCE-DATETIME>20260303122316
ACCESSION NUMBER:		0001628280-26-013637
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20260303
FILED AS OF DATE:		20260303
DATE AS OF CHANGE:		20260303

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			ORGANIGRAM GLOBAL INC.
		CENTRAL INDEX KEY:			0001620737
		STANDARD INDUSTRIAL CLASSIFICATION:	PHARMACEUTICAL PREPARATIONS [2834]
		ORGANIZATION NAME:           	03 Life Sciences
		EIN:				000000000
		STATE OF INCORPORATION:			Z4
		FISCAL YEAR END:			0930

	FILING VALUES:
		FORM TYPE:		6-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-38885
		FILM NUMBER:		26712091

	BUSINESS ADDRESS:	
		ADDRESS IS A NON US LOCATION: 	YES
		STREET 1:		1400-145 KING ST. WEST
		CITY:			TORONTO
		PROVINCE COUNTRY:   	A6
		ZIP:			M5H 1J8
		BUSINESS PHONE:		506-232-4400

	MAIL ADDRESS:	
		ADDRESS IS A NON US LOCATION: 	YES
		STREET 1:		1400-145 KING ST. WEST
		CITY:			TORONTO
		PROVINCE COUNTRY:   	A6
		ZIP:			M5H 1J8

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	ORGANIGRAM HOLDINGS INC.
		DATE OF NAME CHANGE:	20160831

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	ORGANIGRAM HOLDINGS INC
		DATE OF NAME CHANGE:	20140926
</SEC-HEADER>
<DOCUMENT>
<TYPE>6-K
<SEQUENCE>1
<FILENAME>form6-kxmarch32026.htm
<DESCRIPTION>6-K
<TEXT>
<html><head>
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<title>Document</title></head><body><div id="i46b2e99f05054b2c82f9c05b9cd7d889_1"></div><div style="min-height:54pt;width:100%"><div style="padding-right:-4.5pt"><font><br></font></div></div><div style="text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:139%">UNITED STATES</font></div><div style="text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:139%">SECURITIES AND EXCHANGE COMMISSION</font></div><div style="text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:139%">Washington, D.C. 20549</font></div><div style="padding-left:216pt;padding-right:216pt;text-align:center"><font><br></font></div><div style="margin-top:7pt;text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:139%">FORM 6-K</font></div><div style="padding-left:216pt;padding-right:216pt;text-align:center"><font><br></font></div><div style="margin-top:7pt;text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:139%">REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934</font></div><div style="margin-top:12pt;text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:139%">For the month of March 2026</font></div><div style="margin-top:12pt;text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:139%">Commission File Number&#58; </font><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:139%;text-decoration:underline">001-38885</font></div><div style="margin-top:12pt;text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:139%;text-decoration:underline">ORGANIGRAM GLOBAL INC.</font></div><div style="text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:139%">(Translation of registrant&#8217;s name into English)</font></div><div style="text-align:center"><font><br></font></div><div style="text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:160%">145 King Street West, Suite 1400</font></div><div style="text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:160%;text-decoration:underline">Toronto, Ontario ,Canada M5H 1J8</font></div><div style="text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:139%"> </font><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:139%">(Address of principal executive offices)</font></div><div style="text-align:center"><font><br></font></div><div style="margin-top:7pt"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:139%">Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.</font></div><div style="margin-top:12pt;text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:139%">Form 20-F&#160;&#91;  &#93;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:139%">Form 40-F&#160;&#91; X &#93;</font></div><div style="margin-top:12pt;text-align:center"><font><br></font></div><div><font><br></font></div><div><font><br></font></div><div style="height:54pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="padding-right:-4.5pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:54pt;width:100%"><div style="padding-right:-4.5pt"><font><br></font></div></div><div><font><br></font></div><div style="text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:139%">SUBMITTED HEREWITH</font></div><div><font><br></font></div><div><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:139%;text-decoration:underline">Exhibits</font></div><div><table style="border-collapse:collapse;display:inline-table;margin-bottom:5pt;vertical-align:text-bottom;width:100.000%"><tr><td style="width:1.0%"></td><td style="width:6.638%"></td><td style="width:0.1%"></td><td style="width:1.0%"></td><td style="width:91.162%"></td><td style="width:0.1%"></td></tr><tr><td colspan="3" style="background-color:#dbdbdb;padding:2px 1pt;text-align:left;vertical-align:top"><div style="padding-left:0.02pt"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:100%;text-decoration:underline"><a href="projectx-materialchangerep.htm" style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:100%;text-decoration:underline">99.1</a></font></div></td><td colspan="3" style="background-color:#dbdbdb;padding:2px 1pt 2px 1.02pt;text-align:left;vertical-align:top"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:100%">Material Change Report dated March 2, 2026</font></td></tr><tr style="height:15pt"><td colspan="3" style="background-color:#ffffff;padding:0 1pt"></td><td colspan="3" style="background-color:#ffffff;padding:0 1pt"></td></tr></table></div><div><font><br></font></div><div><font><br></font></div><div style="height:54pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="padding-right:-4.5pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:54pt;width:100%"><div style="padding-right:-4.5pt"><font><br></font></div></div><div><font><br></font></div><div style="text-align:center"><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:139%">SIGNATURE</font></div><div style="text-align:center"><font><br></font></div><div><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:139%">Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.</font></div><div><font><br></font></div><div><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:700;line-height:139%">ORGANIGRAM GLOBAL INC.</font></div><div><font><br></font></div><div><font><br></font></div><div><font><br></font></div><div><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:139%;text-decoration:underline">&#47;s&#47; Greg Guyatt           </font><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:139%">           </font></div><div><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:139%">Greg Guyatt</font></div><div><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:139%">Chief Financial Officer</font></div><div><font><br></font></div><div><font style="color:#000000;font-family:'Calibri',sans-serif;font-size:11pt;font-weight:400;line-height:139%">Date&#58; March 3, 2026</font></div><div><font><br></font></div><div><font><br></font></div><div><font><br></font></div><div><font><br></font></div><div><font><br></font></div><div style="height:54pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="padding-right:-4.5pt"><font><br></font></div></div></div></body></html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>projectx-materialchangerep.htm
<DESCRIPTION>EX-99.1
<TEXT>
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<title>Document</title></head><body><div id="i4308358c552843418d3248aab9e0ead1_1"></div><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:12pt;text-align:center"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">FORM 51-102F3<br>MATERIAL CHANGE REPORT</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Item One &#8211; Name and Address of Company</font></div><div style="margin-bottom:12pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Organigram Global Inc. (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Company</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;)<br>145 King Street West, Suite 1400<br>Toronto, Ontario, Canada <br>M5H 1J8</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Item Two &#8211; Date of Material Change</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">February 18, 2026 </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Item Three &#8211; News Release</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The news releases reporting the material changes described in this report were issued in Toronto, Ontario on February 18, 2026 and on February 19, 2026 (collectively, the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">News Releases</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;).</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The News Releases were distributed through Business Wire and filed with each of the relevant Canadian securities regulatory authorities via SEDAR+. The News Releases are available on SEDAR+ at www.sedarplus.ca. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Item Four &#8211; Summary of Material Change</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">On February 18, 2026, the Company (NASDAQ&#58; OGI) (TSX&#58; OGI) announced that it had entered into a definitive share purchase agreement (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Share Purchase Agreement</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) to indirectly acquire all of the issued and outstanding shares (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Purchased Shares</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) of Sanity Group GmbH (&#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Sanity</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221; or &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Sanity Group</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) not already owned by the Company (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Transaction</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;). </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Upon closing of the Acquisition, Organigram will pay shareholders of Sanity (collectively, the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Sellers</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) upfront consideration of &#8364;113.4 million consisting of &#8364;80.0 million cash (except for BAT (as defined below) and share consideration of &#8364;33.4 million in common shares (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Common Shares</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) or Class A preferred shares (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Class A Preferred Shares</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;, and together with the Common Shares, the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Shares</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) in the capital of Organigram, which Shares are expected to be priced at C$3.00 per Organigram Share, representing a 71% premium to the C$1.75 closing price on the Toronto Stock Exchange (&#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">TSX</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) on February 17, 2026. In addition, the Vendors will be entitled to receive earnout consideration of up to &#8364;113.8 million, with the first &#8364;20 million in cash (except for BAT (as defined below) and up to &#8364;93.8 million in Shares based on Sanity&#8217;s financial performance for the 12-month period following the closing., which Shares shall be priced at the TSX 20-day volume-weighted average price on the trading day prior to settlement, subject to a C$3.00 floor and C$4.00 cap. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Concurrently with the execution of the Share Purchase Agreement, the Company entered into a commitment letter with ATB Financial for up to $60.0 million worth of senior secured credit facilities to the Company (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">ATB Credit Facilities</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;), the proceeds of which will be used to </font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">fund the balance of the cash portion of the purchase price for the Transaction and pay certain of the Company&#8217;s expenses related to the Transaction. The ATB Credit Facilities are conditional upon the closing of the Transaction and will close concurrently with the Transaction. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Following the execution and announcement of the Share Purchase Agreement, the Company entered into a subscription agreement (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Subscription Agreement</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) dated February 18, 2026 with BT DE Investments Inc., a wholly-owned subsidiary of British American Tobacco p.l.c. (LSE&#58; BATS and NYSE&#58; BTI) (&#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">BAT</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;), whereby BAT agreed to subscribe for 14,027,074 Shares, on a private placement basis, and 9,897,356 Shares pursuant to certain top-up rights held by BAT (collectively, the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Private Placement Financing</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;). The proceeds of the Private Placement Financing will be used to fund the cash portion of the purchase price for the Transaction and certain of the Company&#8217;s expenses related to the Transaction. The Private Placement Financing is conditional upon the closing of the Transaction and will close concurrently with the Transaction. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Item Five &#8211; Full Description of Material Change</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Transaction Summary</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">On February 18, 2026, the Company announced that it had entered into the Share Purchase Agreement to indirectly acquire all of the issued and outstanding shares of Sanity Group not already owned by the Company. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">In consideration for the Purchased Shares, the Company will pay the Sellers the following&#58; </font></div><div style="margin-bottom:12pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">&#8364;80.0 million in cash (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Closing Cash Consideration</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) on the closing date of the Transaction (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Closing Date</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;), except for BAT which has opted to receive Shares of the Company in lieu of cash consideration&#59;</font></div><div style="margin-bottom:12pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">&#8364;33.4 million in Shares in the capital of the Company on the Closing Date, at a price of $3.00 per Share, representing a 71% premium to the $1.75 closing price of the Company&#8217;s Common Shares on the TSX on February 17, 2026, the day prior to the date of the Share Purchase Agreement (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Closing Share Consideration</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221; and together with the Closing Cash Consideration, the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Closing Consideration</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;)&#59; and </font></div><div style="margin-bottom:12pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">up to &#8364;20.0 million in cash (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Earnout Cash Consideration</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) and up to &#8364;93.8 million in Shares (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Earnout Shares</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;), dependent upon Sanity Group&#8217;s financial performance during the 12-month period following the closing of the Transaction (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Earnout Period</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;), with the Earnout Shares being priced based on the volume-weighted average price of Organigram&#8217;s Common Shares on the TSX for the twenty trading days on which there was a closing price for the Common Shares immediately preceding the settlement of such Shares, subject to a $3.00 floor and $4.00 cap (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Earnout Share Consideration</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;, and together with the Earnout Cash Consideration and Closing Consideration, the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Total Consideration</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;).</font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Company has arranged the following financing commitments (each of which is conditional upon the closing of the Transaction and will close concurrently upon the closing of the Transaction) in order to fund the cash portion of the purchase price payable under the Share Purchase Agreement and certain of the Company&#8217;s expenses relating to the Transaction&#58; </font></div><div style="padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%;padding-left:13.8pt">Credit Facilities with ATB Financial&#58; </font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Concurrently with the execution of the Share Purchase Agreement, the Company and ATB Financial entered into a commitment letter, pursuant to which ATB Financial has committed, subject to the terms and conditions therein, to provide up to $60.0 million worth of senior secured credit facilities to the Company.</font></div><div style="padding-left:36pt;text-align:justify"><font><br></font></div><div style="margin-bottom:12pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%;padding-left:13.8pt">Private Placement Financing with BAT&#58;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> Following the execution and announcement of the Share Purchase Agreement, the Company and BAT entered into the Subscription Agreement. Pursuant to the terms of the Subscription Agreement, BAT engaged in the Private Placement Financing where it subscribed for 14,027,074 Shares of the Company at a price of $3.00 per Share, for gross proceeds of $42.08 million, and also agreed to exercise certain existing top-up rights to subscribe for 9,897,356 Shares at a price of $2.335854 per Share, for gross proceeds of $23.12 million, and total gross proceeds of C$65.2 million. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">In addition, upon the closing of the Private Placement Financing, the Company and BAT will enter into a second amended and restated investor rights agreement (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Second Amended and Restated IRA</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;), which will amend and restate the existing investor rights agreement dated January 23, 2024 between BAT and the Company (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Amended and Restated IRA</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) to, among other things, provide increased flexibility concerning debt financing transactions by the Company and refresh the time periods with respect to certain provisions.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Transaction and Private Placement Financing are considered &#8220;related party transactions&#8221; within the meaning of Multilateral Instrument 61-101 &#8211; </font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:120%">Protection of Minority Security Holders in Special Transactions </font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">(&#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">MI 61-101</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;). In addition, the Transaction (i) provides consideration to BAT (an insider of the Company) in aggregate of 10% or greater of the Company&#8217;s market capitalization, (ii) includes a private placement of Shares to BAT (an insider of the Company) greater than 10% of the number of currently outstanding Shares of the Company on a non-diluted basis, (iii) results in the number of Shares issuable to BAT (an insider of the Company) exceeding 10% of the number of outstanding Shares of the Company on a non-diluted basis, and (iv) results in the number of Shares issuable pursuant to the Transaction exceeding 25% of the number of currently outstanding Shares of the Company on a non-diluted basis. As a result, pursuant to MI 61-101 and the rules of the TSX, the Transaction and Private Placement Financing will require the affirmative vote of at least a simple majority of the Shareholders, present or represented by proxy at the annual general and special meeting of the shareholders (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Meeting</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;), excluding the votes attached to Common Shares beneficially owned, or over which control or direction is exercised, by BAT, its affiliates and their respective directors and officers, in each case as of February 23, 2026, the record date (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Record Date</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) of the Company&#8217;s Meeting to vote on, among other things, upon the Transaction, under section 5.6 of </font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">MI 61-101 and under subsections 604(a)(ii), 607(g)(ii), 611(b) and 611(c) of the TSX Company Manual (such Shareholders, the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Disinterested Shareholders</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;).</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Transaction is anticipated to close in the second quarter of calendar 2026, subject to the satisfaction of certain closing conditions. As noted above, the Private Placement Financing and ATB Credit Facilities are conditional on the closing of the Transaction and closing of the Private Placement Financing and ATB Credit Facilities will occur concurrently with the closing of the Transaction. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Business Reasons for the Transaction</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Transaction is expected to have significant benefits to Organigram and its shareholders, including (collectively, the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Reasons for the Transaction</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;)&#58; </font></div><div style="margin-bottom:12pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:10pt;font-weight:400;line-height:120%">&#8226;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:700;line-height:120%;padding-left:14.5pt">Positions the Company as a Leader in the Global Cannabis Market</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:120%">.</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> The Transaction accelerates Organigram&#8217;s expansion into global cannabis markets by establishing a leading position in Germany, the world&#8217;s second-largest federally legal cannabis market after Canada, valued at over &#8364;2 billion in 2025 and serving approximately 800,000 patients, with market forecasts projecting continued growth beyond &#8364;4.5&#160;billion by 2028. Through exposure to Germany, the UK, Switzerland and Poland, the Company will be well positioned to capture growth in rapidly expanding European markets. </font></div><div style="margin-bottom:12pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:10pt;font-weight:400;line-height:120%">&#8226;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:700;line-height:120%;padding-left:14.5pt">Creates a Vertically Integrated European Hub and Sophisticated Commercial Footprint. </font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Transaction will provide the Company with a vertically integrated European footprint, embedding a highly skilled local leadership team and a strong network of strategic partners in the global cannabis supply chain. Entering the European supply chain with Sanity Group&#8217;s deep network will position the Company to sell significantly greater volumes of high-margin flower, creating the ability to capture more of the value chain. The Company will capitalize on Sanity Group&#8217;s sophisticated commercial capabilities across Germany, Poland, the UK, and Switzerland and engage Sanity Group&#8217;s regulatory expertise, which is critical to navigating new markets. </font></div><div style="margin-bottom:12pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:10pt;font-weight:400;line-height:120%">&#8226;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:700;line-height:120%;padding-left:14.5pt">Financially Accretive Acquisition with Strong Growth and Profitability Profile.</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> The Transaction is expected to be financially accretive to the Company, delivering meaningful and strategic scale to the Company&#8217;s revenue and profitability. In 2025, Sanity Group demonstrated consistent net revenue growth from &#8364;9&#160;million in 2023 to &#8364;61&#160;million in 2025, including &#8364;19&#160;million generated in the fourth quarter of 2025, with continued profitability anticipated. Sanity Group has achieved consistent gross margin improvements, from 14.5% in 2023 to 47.2% in 2025, and based on Sanity Group&#8217;s internal estimates, has grown to the second largest market share position in the German cannabis market as of November 2025. </font></div><div style="margin-bottom:12pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:10pt;font-weight:400;line-height:120%">&#8226;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:700;line-height:120%;padding-left:14.5pt">Establishes a European Retail Presence and Credibility for Future Pilot Projects. </font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Company will gain immediate access to the Swiss retail market through Sanity Group&#8217;s two established pilot project locations. Sanity Group&#8217;s pilot project experience and established branding will enhance the Company&#8217;s credibility for future pilot projects in </font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:12pt;padding-left:36pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">new European markets, specifically as the global regulatory landscape continues to evolve. </font></div><div style="margin-bottom:12pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:10pt;font-weight:400;line-height:120%">&#8226;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:700;line-height:120%;padding-left:14.5pt">Expansion of Organigram Brand and Intellectual Property. </font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Transaction will provide the Company with the potential opportunity to implement its industry leading brands and intellectual property into new global markets and support the expansion of its strategic partnerships. Sanity Group&#8217;s portfolio of brands reflects shared values surrounding innovation, whereby the Company can expand its focus on new developments including a suite of emulsions, novel vapour formulations, flavour innovations, and packaging solutions. The Company anticipates the expansion and collaboration with Sanity Group&#8217;s established brands will deliver market share and revenue growth for the Company by appealing to a broad range of consumers seeking new, progressive cannabis formats.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Board Recommendation </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Company&#8217;s board of directors (the &#8220;</font><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Board</font><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) and the Investment Committee of the Board (the &#8220;</font><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Investment Committee</font><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) engaged BMO Nesbitt Burns Inc. (&#8220;</font><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">BMO Capital Markets</font><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) to provide an oral opinion, which oral opinion was subsequently confirmed in writing, to the effect that, as of February 11, 2026, and based upon and subject to the assumptions, limitations and qualifications to be set forth in its written opinion, the consideration to be paid by the Company pursuant to the Share Purchase Agreement is fair, from a financial point of view, to the Company (the &#8220;</font><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Opinion</font><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;).</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Board and Investment Committee, having undertaken a thorough review of, and having carefully considered the terms of the Transaction and the Reasons for the Transaction listed above, and after consulting with its legal and financial advisors and having considered the Opinion provided by BMO Capital Markets, unanimously (with Craig Harris, Simon Ashton and Karina Gehring, being the BAT nominees to the Board, abstaining) determined that the Transaction is in the best interests of the Company and determined that the terms and conditions of the Transaction are fair and reasonable to the Company. Accordingly, the Board unanimously (excluding Craig Harris, Simon Ashton and Karina Gehring, being the Board representatives nominated by BAT) approved the Transaction.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">The Share Purchase Agreement</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">In connection with the Transaction, the Company incorporated a wholly-owned German limited liability company (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Purchaser</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) that will acquire all of the issued and outstanding shares of Sanity (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Sanity Shares</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) from the Sellers, pursuant to the terms of the Share Purchase Agreement dated February 18, 2026 (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Signing Date</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;).</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Consideration</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">As consideration for the Sanity Shares, the Company has agreed to pay&#58; </font></div><div style="padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">&#8364;80.0 million in cash consideration on the Closing Date of the Transaction&#59; and</font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="padding-left:36pt;text-align:justify"><font><br></font></div><div style="padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">&#8364;33.4 million of share consideration, currently expected to consist of 4,139,748 Common Shares and, in the case of BAT, 13,693,120 Class A Preferred Shares in the capital of the Company for a deemed price per Share of $3.00, representing a 71% premium to the $1.75 closing price of the Common Shares on the TSX on February 17, 2026, the last trading day prior to the date of the Share Purchase Agreement. </font></div><div style="text-align:justify"><font><br></font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Sellers may also be entitled to earn-out consideration based on the financial performance of Sanity during the Earnout Period. The earn-out is calculated based on a notional valuation determined by equally weighting net revenue and EBITDA, with net revenue multiplied by 1.75x and EBITDA multiplied by 12.5x, as further described in the Share Purchase Agreement.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Subject to the achievement of applicable performance thresholds and certain adjustments, the earn-out consideration may consist of&#58;</font></div><div style="padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">up to &#8364;20 million in cash consideration&#59; and </font></div><div style="padding-left:36pt;text-align:justify"><font><br></font></div><div style="padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">up to &#8364;93.8 million of share consideration, currently expected to consist of 50,649,376 Common Shares, to be issued at a deemed price per Share equal to the volume-weighted average trading price of the Company&#8217;s Common Shares on the TSX for the twenty trading days immediately preceding settlement, subject to a $3.00 floor and $4.00 cap. </font></div><div style="text-align:justify"><font><br></font></div><div style="text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Closing Consideration is subject to a post-closing adjustment to reflect the actual cash, debt and working capital of Sanity Group as of the Closing Date, as determined in accordance with the terms of the Share Purchase Agreement.</font></div><div style="text-align:justify"><font><br></font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">BAT&#8217;s Consideration under the Share Purchase Agreement</font></div><div style="margin-bottom:5pt;margin-top:5pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">BAT is a shareholder of both Organigram and Sanity and has elected to receive Shares of the Company for its consideration under the Share Purchase Agreement in lieu of cash consideration for its interest in Sanity Group.</font></div><div style="margin-bottom:5pt;margin-top:5pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Share Purchase Agreement contains a provision which limits BAT&#8217;s ownership of the Company&#8217;s Common Shares, such that if, after giving effect to the Closing Share Consideration or Earnout Share Consideration, as applicable, the aggregate number of Common Shares beneficially owned or controlled, directly or indirectly, by BAT, its affiliates, associates, related parties and any joint actors, would exceed 30% of the issued and outstanding Common Shares (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">30% Threshold</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;), BAT will be issued the greatest number of Common Shares issuable under the Closing Consideration or Earnout Consideration, as applicable, without exceeding the 30% Threshold, and thereafter, shall be issued the balance of the Shares as Class A Preferred Shares. </font></div><div style="margin-bottom:5pt;margin-top:5pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Class A Preferred Shares are convertible initially on a one-for-one basis, with the conversion rate increasing at a rate of 7.5% per annum until such time as the holders of Class A Preferred Shares would beneficially own 49.0% of the aggregate number of Common Shares issued and outstanding.</font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:5pt;margin-top:5pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Pursuant to the Transaction, BAT is currently expected to receive 13,693,120 Class A Preferred Shares as Closing Share Consideration and 6,625,559 Common Shares as Earnout Share Consideration (assuming the floor earnout share price of C$3.00, and that the full earnout is achieved). </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Company and Seller Warranties</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Share Purchase Agreement contains customary warranties of Sanity and its subsidiaries, including fundamental representations relating to corporate authority, good standing, absence of insolvency proceedings and ownership and governance matters, as well as business representations relating to, among other things, financial statements, assets, material contracts, intellectual property, employment matters, regulatory compliance, permits, insurance and legal proceedings.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Company and the Purchaser, among other related parties under the Share Purchase Agreement, have given customary warranties relating to certain matters, including without limitation, the following&#58; enforceability, corporate power, litigation, reservation for issuance of Closing Share Consideration and Earnout Share Consideration, sufficient funds, no material adverse change since the Purchaser&#8217;s most recent publicly filed financial statements, the free tradability of the Closing Share Consideration and insolvency.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Closing Conditions</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:120%">Mutual Closing Conditions</font></div><div style="margin-bottom:12pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Share Purchase Agreement provides that the obligations of the parties to complete the Transaction are subject to the following mutual conditions precedent&#58;</font></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">receipt of clearance of the Transaction under Germany&#8217;s foreign direct investment regime </font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">from the German Ministry of Economics and Energy (the &#8220;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">FDI Approval</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;)&#59;</font></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">the required approvals, consents and authorizations of the securities regulatory authorities necessary to give effect to the Share Purchase Agreement, including approval by the TSX and notification to the NASDAQ, must have been obtained&#59; and</font></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">there must be no law enacted, order, legal proceeding or other legal or regulatory restraint that has the effect of making the transactions contemplated illegal or prevents, restrains or otherwise prohibits the consummation of the transactions contemplated (collectively, &#8220;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Mutual Closing Conditions</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;).</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:120%">Purchaser&#8217;s Closing Conditions</font></div><div style="margin-bottom:12pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Share Purchase Agreement provides that the obligations of the Company to consummate the Transaction are subject to the satisfaction of the following conditions precedent&#58;</font></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">there having been no Material Adverse Change (as defined in the Share Purchase Agreement) between the Signing Date and the Closing Date of the Transaction&#59;</font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">the Purchaser having obtained, on terms and conditions satisfactory to the Purchaser in its sole discretion, third-party financing (which the Company anticipates will be satisfied through the Private Placement Financing and the ATB Credit Facilities)&#59;</font></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">approval of the Transaction by the Company&#8217;s shareholders&#59; and</font></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">the representations and warranties of Sanity contained in the Share Purchase Agreement must be true and correct as of the Closing Date (collectively, &#8220;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Purchaser Closing Conditions</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;).</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Interim Period Covenants</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">During the period from the Signing Date until closing of the Transaction (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Interim Period</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;), the Sellers and Sanity have covenanted that, as applicable and to the extent permitted by law&#58; </font></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">the business of Sanity and its subsidiaries will be managed in accordance with good business practices and in the ordinary course&#59;</font></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">Sanity and its subsidiaries will use best efforts to comply with all material applicable laws and maintain all licenses, consents and authorizations necessary to carry on the businesses of Sanity and its subsidiaries&#59; </font></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">Sanity and its subsidiaries will use best efforts to preserve customer and supplier relationships in the ordinary and usual course consistent with past practice&#59; </font></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">Sanity and its subsidiaries will use best efforts to preserve their assets in good working condition and in the ordinary course of business&#59; and </font></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">Sanity and its subsidiaries will keep proper accounting records, making true and complete entries of all dealings and transactions</font><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">. </font></div><div style="text-align:justify"><font><br></font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Sellers and Sanity have further covenanted that during the period from the Signing Date until the Closing Date that (i) none of the following matters will occur or be agreed to with respect to Sanity and its subsidiaries, and (ii) the Sellers and Sanity will not vote in favour of any of the following matters in any shareholders or board meeting of Sanity or any subsidiary, without the prior consent of the Purchaser&#58; (a) no shareholder resolutions will be approved, (b) no amendments will be made to the constating documents or capital structure of Sanity or any of its subsidiaries, (c) no dividends or other distributions will be declared or paid, (d) no shares of Sanity will be sold, transferred or encumbered, (e) no liquidation, merger or restructuring will be undertaken, (f) no material assets or equity interests will be disposed of, (g) no material agreements will be terminated, (h) no mass layoffs of employees will be conducted, (i) no directors or key employees will be hired, terminated or have their terms of employment materially amended, (j) no directors will be appointed or removed, and (k) no other actions specified in the Share Purchase Agreement will be taken or voted in favour of at any shareholders&#8217; or board meeting of Sanity or any of its subsidiaries.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Sanity and the Sellers, as applicable, have covenanted that, on or before the closing of the Transaction, all Related Party Agreements (as defined in the Share Purchase Agreement), shall </font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">be terminated by mutual agreement, effective as of the Closing Date of the Share Purchase Agreement. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Additionally, Sanity has covenanted that prior to the Signing Date, (i) the Sellers and Sanity have entered into a Payment Undertaking Agreement (as defined under the Share Purchase Agreement) pursuant to which the Sellers have acceded as additional debtors to the claims of all virtual share option plan (&#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">VSOP</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) beneficiaries, triggered by reason of the Transaction and (ii) that the Sellers have unconditionally settled any such claims with the VSOP beneficiaries in full without recourse against Sanity. Sanity shall, no later than ten (10) business days after the signing date of the Share Purchase Agreement, ensure each VSOP beneficiary is notified of the Transaction and their respective entitlements and is requested to waive such rights</font></div><div style="text-align:justify"><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Board Appointment </font></div><div style="text-align:justify"><font><br></font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Subject to the terms and conditions of the Share Purchase Agreement, the Company has agreed to appoint a representative of the Sellers, initially Mr. Max Konrad Narr, to the Board of Directors (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Board</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) following Closing of the Transaction for the duration of the Earnout Period. </font></div><div style="text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Conduct of Business During Earnout Period</font></div><div style="text-align:justify"><font><br></font></div><div style="text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Following the Closing Date, the Purchaser must allow Sanity and its subsidiaries to continue in the ordinary course of business consistent with past practice and with the due care and diligence of an orderly and prudent businessman conducted on or prior to the Closing Date for the duration of the Earnout Period.</font></div><div style="text-align:justify"><font><br></font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Redemption Rights</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Pursuant to the terms of the Share Purchase Agreement, if any Seller fails to satisfy any claim(s) of the Purchaser for compensation of any damages pursuant to a breach by such Seller of a Sellers&#8217; Warranty, Indemnities, Tax Warranties or the Tax Indemnity (each as defined under the Share Purchase Agreement) and such breach is not cured within ten (10) business days after such claims have been acknowledged by the Seller or confirmed by final legal title, each Seller unconditionally and irrevocably grants the Company the right to redeem, without consideration, any Closing Share Consideration and&#47;or Earnout Share Consideration received by the Seller to satisfy such claim(s) (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Redemption Right</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;). The number of Shares to be redeemed by the Company pursuant to the Redemption Right shall be determined based on the value of the applicable damages divided by the applicable price per Share at the time of such claim.  </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Share Purchase Agreement does not impose a limitation on the number of Shares that may be redeemed by the Company under the Redemption Right, however, the terms of the Share Purchase Agreement provide that a Sellers&#8217; liability cannot exceed the portion of the purchase price received by the Seller under the Share Purchase Agreement, subject to certain exceptions. Accordingly, if the Company redeemed the maximum number of Shares under the Redemption Right from a Seller, such Seller&#8217;s interest in the Company would be extinguished.  </font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Board discussed the terms of the Redemption Right when considering whether to approve the Share Purchase Agreement and determined that including the Redemption Right in the Share Purchase Agreement was in the best interests of the Company. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Termination </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Subject to the terms and conditions in the Share Purchase Agreement, if any of the Mutual Closing Conditions or the Purchaser Closing Conditions have not been fulfilled by August 18, 2026, the parties have the ability terminate the Share Purchase Agreement upon written notice to the other parties. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Non-Competition and Non-Solicitation</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Share Purchase Agreement includes non-competition and non-solicitation covenants applicable to a founder of Sanity, Finn Age H&#228;nsel and an entity in which such founder is the sole shareholder (collectively, &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Mr. H&#228;nsel</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;), for a period of three years following closing. During such period, and subject to the terms of the Share Purchase Agreement, Mr. H&#228;nsel is prohibited from establishing a competing business, acquiring interests in competing businesses (other than minority interests for investment purposes or equity in the Company), or serving as a consultant or advisor to competing businesses. Mr. H&#228;nsel is also not permitted to solicit, entice or induce any employee, agent, officer, director or vendor, or knowingly solicit, entice or induce any customer of Sanity.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Lock-Up Restrictions</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Shares issued to the Sellers (and to the Trustors (as such term is defined in the Share Purchase Agreement) in respect of the Earnout Shares), excluding any Shares issued to BAT, are subject to certain lock-up restrictions. Each of the Sellers (and the Trustors (as such term is defined in the Share Purchase Agreement) in respect of the Earnout Shares) agree, subject to the terms of the Share Purchase Agreement, that&#58; (i) for the first three month period after receipt of the Shares not to make any dispositions, and (ii) for the subsequent three month period after receipt of the Shares not to dispose of more than 50% of such Shares. Thereafter, the Sellers may dispose of all of its remaining Shares if they so choose.</font></div><div style="text-align:justify"><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">ATB Credit Facilities</font></div><div style="text-align:justify"><font><br></font></div><div style="margin-bottom:6pt;text-align:justify"><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Concurrently with the execution of the Share Purchase Agreement, the Company entered into the ATB Credit Facilities, whereby ATB Financial will provide senior secured credit facilities of up to $60.0 million, acting as sole lead arranger and bookrunner. The ATB Credit Facilities consists of&#58; </font></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">a $40.0 million senior secured facility comprised of a $10.0 million operating line&#59;</font></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt">a $30.0 million revolving credit facility&#59; and</font></div><div style="margin-bottom:6pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8226;</font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;padding-left:13.8pt"> a $20.0 million senior secured non-revolving credit facility.</font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="text-align:justify"><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The ATB Credit Facilities will be available on closing of the Transaction, subject to customary closing conditions, and bear interest at ATB Financials&#8217; referenced benchmark rates plus a spread determined by funded debt to trailing twelve-month adjusted EBITDA. The ATB Credit Facilities are subject to normal course funded debt and fixed charge covenants. </font></div><div style="text-align:justify"><font><br></font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Subscription Agreement</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Following the execution and announcement of the Share Purchase Agreement, the Company and BAT entered into the Subscription Agreement. Pursuant to the terms of the Subscription Agreement, BAT will subscribe for 14,027,074 Shares at a price of $3.00 per share, for gross proceeds of $42.08 million and the exercise of certain existing top-up rights to subscribe for 9,897,356 Shares at a price of $2.335854 per Share, for gross proceeds of approximately $23.12 million, for total gross proceeds of $65.2 million. The proceeds from the Private Placement Financing will be used to fund the cash component of the Transaction and for transaction expenses. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">In connection with the closing of the Private Placement Financing, the Company and BAT intend to enter into the Second Amended and Restated IRA, which will amend and restate the existing Amended and Restated IRA to, among other things, extend the term of certain standstill and lock-up provisions, and make certain housekeeping amendments.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Consideration</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Pursuant to the terms of the Subscription Agreement,  BAT has agreed to (i) exercise its existing top-up rights under the Amended and Restated IRA to purchase 9,897,356 Shares at a price of $2.335854 per Share, for an approximate aggregate total of $23,118,778, and (ii) subscribe for 14,027,074 Shares at a price of $3.00 per Share, on a private placement basis, for an approximate aggregate total of $42,081,222, resulting in gross total proceeds of $65.2 million (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Subscription Proceeds</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;). </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">With respect to issuances of Shares under Subscription Agreement, to the extent BAT&#8217;s ownership of Shares in the Company exceeds 30.0% of the total issued and outstanding Common Shares on a post-issuance basis, BAT would, in lieu of Common Shares, be issued non-voting Class A Preferred Shares. The Class A Preferred Shares are convertible initially on a one-for-one basis, with the conversion rate increasing at a rate of 7.5% per annum until such time as the holders of Class A Preferred Shares would beneficially own 49.0% of the aggregate number of Common Shares issued and outstanding.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Conditions Precedent to Closing</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Closing of the Private Placement Financing is subject to the satisfaction or waiver of the following mutual closing conditions in favour of each of BAT and the Company, including&#58; (i) all approvals, consents and authorizations necessary for the consummation of the Private Placement Financing have been obtained, including the TSX Approval (which shall be subject only to customary conditions) and the NASDAQ Notification&#59; (ii) no order issued by a Governmental Authority (as defined in the Share Purchase Agreement), and no statute, rule, </font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">regulation or executive order promulgated or enacted by a Governmental Authority, enjoins, prohibits or otherwise makes illegal the consummation of the Private Placement Financing&#59; (iii) no material claim, at law or in equity, shall be pending or threatened by any person, governmental authority or securities regulator in connection with the Private Placement Financing&#59; (iv) no order having the effect of suspending the issuance or ceasing the trading of any of the Common Shares issued or made by any governmental authority, securities regulator or stock exchange shall be in effect&#59; and (v) all of the conditions precedent to the obligation of the Company to effect the closing of the Transaction as set forth in the Share Purchase Agreement shall have been satisfied or waived (other than those conditions that, by their terms, cannot be satisfied until closing under the Share Purchase Agreement).</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The closing of the Private Placement Financing is also conditional on the following conditions in favour of BAT&#58; (i) the Company shall have performed and complied in all material respects with all covenants and agreements required by the Subscription Agreement to be performed or complied with by it on or prior to the Closing Date&#59; (ii) the Company shall have made, or caused to be made, all of the required deliveries&#59; (iii) the consummation of the Private Placement Financing is not reasonably expected to result in a BAT Material Adverse Effect (as defined in the Subscription Agreement)&#59; and (iv) the Share Purchase Agreement shall not have been altered, amended or otherwise modified or supplemented or any provision or condition therein waived, nor any consent granted, if such alteration, amendment, modification, supplement, waiver or consent would be materially adverse to the interests of the Company or BAT, without BAT&#8217;s prior written consent (acting reasonably). </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The closing of the Private Placement Financing is also conditional on the following conditions in favour of the Company&#58; (i) BAT shall have performed and complied in all material respects with all covenants and agreements required by the Subscription Agreement to be performed or complied with by it on or prior to closing&#59; and (ii) BAT shall have made, or caused to be made, the required deliveries, including total gross subscription proceeds of $65.2 million.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Termination of the Subscription Agreement</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Subscription Agreement will terminate automatically on the closing, upon termination in accordance with its terms, or automatically on August 18, 2026, whichever is earlier.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Prior to the Closing Date, the Subscription Agreement may be terminated by&#58; (i) the mutual written agreement of the parties&#59; (ii) by the Company or BAT, if the Share Purchase Agreement is validly terminated in accordance with its terms&#59; (iii) by the Company, if the mutual conditions or the conditions in favour of the Company cannot be satisfied on or before the Closing Date&#59; or (iv) by BAT, if the mutual conditions or the conditions in favour of BAT cannot be satisfied on or before the Closing Date. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">If BAT terminates the Subscription Agreement as a result of the consummation of the Private Placement Financing resulting from a BAT Material Adverse Effect (as defined in the Subscription Agreement) on or before the Closing Date, prior to or concurrently with the </font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">termination of the Subscription Agreement, BAT is required to pay a termination fee to the Company.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Use of Proceeds</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Unless otherwise consented to in writing by BAT in advance, the Company shall use the proceeds for the sole purpose of (i) funding the cash portion of the purchase price payable by the Company to Sanity Group for the Transaction pursuant to the Share Purchase Agreement, and (ii) paying transaction expenses in connection with the Transaction.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Closing</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">According to the terms of the Subscription Agreement, the Private Placement Financing will close concurrently with, and is conditional upon, the closing of the Transaction. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Shareholder Approval Requirements</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Transaction and Private Placement Financing are subject to certain shareholder approval requirements pursuant to MI 61-101 and the TSX Company Manual. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Multilateral Instrument 61-101 &#8211; Protection of Minority Security Holders in Special Transactions</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Pursuant to MI&#160;61-101, a &#8220;related party&#8221; includes a shareholder holding over 10% of the voting rights attached to the voting securities of the issuer. BAT beneficially owns over 10% of the issued and outstanding Common Shares and is a &#8220;related party&#8221; for the purposes of MI&#160;61-101. The Transaction (in that BAT is a Seller) and Private Placement Financing (in that BAT is the subscriber) are each considered a &#8220;related party transaction&#8221; under MI 61-101, which requires (absent an available exemption), that an issuer obtain minority shareholder approval and a formal valuation for the transaction and that the issuer provide enhanced disclosure with respect to the transaction.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:120%">Exemption from Formal Valuation Requirement under Section 5.5(a) of MI 61-101 for the Transaction</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">  </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">BAT currently owns 13,532 Sanity Shares (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">BAT Sanity Shares</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;), representing 16.3% of the issued and outstanding Sanity Shares. As of the day prior to the date of the Share Purchase Agreement, the fair market value of BAT&#8217;s Sanity Shares was $62,518,194. As of the last trading day prior to the date of the Share Purchase Agreement, the Company&#8217;s market capitalization, as calculated in accordance with Section 5.5(a) MI 61-101, was $262,721,951. As neither (i) the fair market value of the BAT Sanity Shares being sold to the Company under the Transaction, nor (ii) the fair market value of the consideration paid to BAT for the BAT Sanity Shares under the Share Purchase Agreement exceeds 25% of the Company&#8217;s market capitalization, the Transaction is exempt from the formal valuation requirements of Section 5.4 of MI 61-101 pursuant to Subsection 5.5(a) of MI 61-101.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:120%">Exemption under Section 5.5(c) of MI 61-101 for the Private Placement Financing</font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Private Placement Financing is exempt from the formal valuation requirements of Section 5.4 of MI 61-101 pursuant to Section 5.5(c) of MI 61-101, as the Private Placement Financing involves a distribution of securities to a related party for cash consideration. In addition, the other conditions of Section 5.5(c) have been satisfied, as neither the Company nor, to the knowledge of the Company after reasonable inquiry, BAT (as the &#8220;related party&#8221;), had knowledge of any material information concerning the Company or its securities that had not been generally disclosed at the time the Subscription Agreement governing the Private Placement Financing was executed and delivered.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The following table describes the anticipated effect of the Transaction and Private Placement Financing, based on the Company&#8217;s 136,337,341 issued and outstanding Shares as of the Record Date, on the percentage of Shares controlled by BAT&#58;</font></div><div style="margin-bottom:12pt"><table style="border-collapse:collapse;display:inline-table;margin-bottom:5pt;vertical-align:text-bottom;width:100.000%"><tr><td style="width:1.0%"></td><td style="width:15.726%"></td><td style="width:0.1%"></td><td style="width:1.0%"></td><td style="width:9.156%"></td><td style="width:0.1%"></td><td style="width:1.0%"></td><td style="width:8.515%"></td><td style="width:0.1%"></td><td style="width:1.0%"></td><td style="width:9.476%"></td><td style="width:0.1%"></td><td style="width:1.0%"></td><td style="width:9.476%"></td><td style="width:0.1%"></td><td style="width:1.0%"></td><td style="width:14.765%"></td><td style="width:0.1%"></td><td style="width:1.0%"></td><td style="width:9.957%"></td><td style="width:0.1%"></td><td style="width:1.0%"></td><td style="width:14.129%"></td><td style="width:0.1%"></td></tr><tr><td colspan="3" style="background-color:#d9d9d9;border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 2.38pt;text-align:center;vertical-align:top"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:700;line-height:100%">Holdings (% of class)</font></td><td colspan="3" style="background-color:#d9d9d9;border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 2.38pt;text-align:center;vertical-align:top"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:700;line-height:100%">Current</font></td><td colspan="3" style="background-color:#d9d9d9;border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 2.38pt;text-align:center;vertical-align:top"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:700;line-height:100%">Private Placement Financing </font></td><td colspan="3" style="background-color:#d9d9d9;border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 2.38pt;text-align:center;vertical-align:top"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:700;line-height:100%">Pro Forma Private Placement Financing Only </font></td><td colspan="3" style="background-color:#d9d9d9;border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 2.38pt;text-align:center;vertical-align:top"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:700;line-height:100%">Transaction (Closing Consideration Only)</font></td><td colspan="3" style="background-color:#d9d9d9;border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 2.38pt;text-align:center;vertical-align:top"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:700;line-height:100%">Pro-Forma Private Placement Financing + Transaction (Closing Consideration Only)</font></td><td colspan="3" style="background-color:#d9d9d9;border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:top"><div style="padding-left:2.77pt;padding-right:2.77pt;text-align:center"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:700;line-height:120%">Transaction (Earnout Consideration)</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:700;line-height:120%">(2)</font></div></td><td colspan="3" style="background-color:#d9d9d9;border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-right:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 2.38pt;text-align:center;vertical-align:top"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:700;line-height:100%">Pro-Forma (Private Placement Financing + Transaction with Maximum Earnout Consideration )</font></td></tr><tr><td colspan="3" style="border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt 2px 3.77pt;text-align:left;vertical-align:middle"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:100%">BAT Common Share Holdings</font></td><td colspan="3" style="border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><div style="padding-left:2.77pt;padding-right:2.77pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">40,134,389 (</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:400;line-height:120%">29.44%</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">)</font></div></td><td colspan="3" style="border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:100%">1,095,000</font></td><td colspan="3" style="border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:top"><div style="padding-left:2.77pt;padding-right:2.77pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">41,229,389 (</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:400;line-height:120%">30.0%</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">)</font></div></td><td colspan="3" style="border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:100%">1,774,000</font></td><td colspan="3" style="border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><div style="padding-left:2.77pt;padding-right:2.77pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">43,003,389 (</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:400;line-height:120%">30.0%</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">)</font></div></td><td colspan="3" style="border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:100%">6,625,559</font></td><td colspan="3" style="border-left:0.5pt solid #000000;border-right:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><div style="padding-left:2.77pt;padding-right:2.77pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">49,628,948 (</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:400;line-height:120%">25.6%</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">)</font></div></td></tr><tr><td colspan="3" style="border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt 2px 3.77pt;text-align:left;vertical-align:middle"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:100%">BAT Class A Preferred Share Holdings</font></td><td colspan="3" style="border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><div style="padding-left:2.77pt;padding-right:2.77pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">13,794,163 (</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:400;line-height:120%">100%</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">)</font></div></td><td colspan="3" style="border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:100%">22,829,430</font></td><td colspan="3" style="border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:top"><div style="padding-left:2.77pt;padding-right:2.77pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">36,623,593 (</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:400;line-height:120%">100%</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">)</font></div></td><td colspan="3" style="border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:100%">11,919,120</font></td><td colspan="3" style="border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><div style="padding-left:2.77pt;padding-right:2.77pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">48,542,713 (</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:400;line-height:120%">100%</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">)</font></div></td><td colspan="3" style="border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:100%">-</font></td><td colspan="3" style="border-left:0.5pt solid #000000;border-right:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><div style="padding-left:2.77pt;padding-right:2.77pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">48,542,713 (</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:400;line-height:120%">100%</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">)</font></div></td></tr><tr><td colspan="3" style="border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><div style="padding-left:2.77pt;padding-right:2.77pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">BAT Common and Class A Preferred Share Holdings </font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:400;line-height:120%">(including accretion on Class A Preferred Shares and partially diluted to assume conversion of Class A Preferred Shares)</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:5.2pt;font-style:italic;font-weight:400;line-height:120%;position:relative;top:-2.8pt;vertical-align:baseline">3</font></div></td><td colspan="3" style="border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><div style="padding-left:2.77pt;padding-right:2.77pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">55,397,819 (</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:400;line-height:120%">36.5%</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">)</font></div></td><td colspan="3" style="border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:100%">23,924,430</font></td><td colspan="3" style="border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:top"><div style="padding-left:2.77pt;padding-right:2.77pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">79,322,249 (</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:400;line-height:120%">48.4%</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">)</font></div></td><td colspan="3" style="border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:100%">13,693,120</font></td><td colspan="3" style="border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><div style="padding-left:2.77pt;padding-right:2.77pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">93,015,368 (</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:400;line-height:120%">48.1%</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">)</font></div></td><td colspan="3" style="border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:100%">10,376,458</font></td><td colspan="3" style="border-bottom:0.5pt solid #000000;border-left:0.5pt solid #000000;border-right:0.5pt solid #000000;border-top:0.5pt solid #000000;padding:2px 1pt;text-align:left;vertical-align:middle"><div style="padding-left:2.77pt;padding-right:2.77pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">103,391,826 (</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-style:italic;font-weight:400;line-height:120%">41.7%</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:120%">)</font></div></td></tr></table></div><div><font style="color:#000000;font-family:'Times New Roman',serif;font-size:6pt;font-weight:400;line-height:120%;text-decoration:underline">&#160;&#160;&#160;&#160;</font></div><div style="margin-bottom:2pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:6pt;font-weight:400;line-height:120%">Notes&#58;</font></div><div style="margin-bottom:6pt;padding-left:21.6pt;text-align:justify;text-indent:-21.6pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:7pt;font-weight:400;line-height:100%">(1)</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:100%;padding-left:13.44pt">This table differs from the Company&#8217;s press release of February 18, 2026, as for the purpose of seeking TSX and shareholder approval, the Company is required to authorize the maximum number of shares that can potentially be issued in connection with the Transaction. As a result, this table assumes the maximum earnout payable and that all share consideration is issued at a C$3.00 floor price. In addition, since the issuance of the above referenced press release, the Company has issued approx. 1.2 million shares in connection with the Collective Project earnout.</font></div><div style="margin-bottom:6pt;padding-left:21.6pt;text-align:justify;text-indent:-21.6pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:7pt;font-weight:400;line-height:100%">(2)</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:100%;padding-left:13.44pt">The earnout assumes the maximum earn-out payable at a C$3.00 floor price. The numbers of Shares in the table are calculated based on a EUR&#58;CAD exchange rate of &#8364;1.00 &#61; C$1.6148 as of the Record Date. BAT&#8217;s holdings of Common Shares include those beneficially owned, controlled or directed by any of its subsidiaries. The number of BAT Common and Class A Preferred Share Holdings issued as Earn Out Consideration include 3,750,898 accreted Class A Preferred Shares. Note that these amounts may increase due to changes in the EUR&#58;CAD exchange rate and do not reflect post-closing accretion of the Class A Preferred Shares. </font></div><div style="margin-bottom:6pt;padding-left:21.6pt;text-align:justify;text-indent:-21.6pt"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:7pt;font-weight:400;line-height:100%">(3)</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:8pt;font-weight:400;line-height:100%;padding-left:13.44pt">The number of current BAT Common and Class A Preferred Share Holdings include 1,469,267 accreted Class A Preferred Shares and the number of BAT Common and Class A Preferred Share Holdings issued as Earn Out Consideration (per Note 2) include 3,750,898 accreted Class A Preferred Shares.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:120%">Minority Shareholder Approval </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Transaction and the Private Placement Financing are subject to &#8220;minority approval&#8221; of every class of &#8220;affected securities&#8221; of the issuer (each as defined in MI 61-101). As a result, the resolution that the Company will put forth for Shareholder approval of the Transaction and the Private Placement Financing (the &#8220;</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Transaction Resolution</font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">&#8221;) at the Meeting will require the affirmative vote of at least a majority of the votes cast by the Shareholders, present in person or represented by proxy at the Meeting, excluding the votes attached to the Common Shares that are </font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">beneficially owned or over which control or direction is exercised by as of the Record Date by BAT, its affiliates and their respective directors and officers, and any other &#8220;related parties&#8221; and &#8220;joint actors&#8221; (each as defined in MI 61-101) of BAT. To the knowledge of the Company, as of the Record Date, an aggregate of 40,134,389 Common Shares, held by BAT representing approximately 29.44% of the issued and outstanding Common Shares on a non-diluted basis as of the Record Date, will be excluded for purposes of calculating the requisite minority shareholder approval of the Transaction Resolution.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%;text-decoration:underline">Disinterested Shareholder Approval &#8211; TSX Company Manual</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The TSX Company Manual requires shareholder approval in certain circumstances where a listed issuer issues securities in connection with an acquisition. As described below, the Transaction Resolution is subject to Disinterested Shareholder approval under the TSX Company Manual.  </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Transaction (i) provides consideration to BAT (an insider of the Company) in aggregate of 10% or greater of the Company&#8217;s market capitalization pursuant to section 604(a)(ii) of the TSX Company Manual, (ii) includes a private placement of Shares to BAT (an insider of the Company) greater than 10% of the number of currently outstanding Shares of the Company on a non-diluted basis pursuant to section 607(g)(ii) of the TSX Company Manual, (iii) results in the number of Shares issuable to BAT (an insider of the Company) exceeding 10% of the number of outstanding Shares of the Company on a non-diluted basis pursuant to section 611(b) of the TSX Company Manual, and (iv) results in the number of Shares issuable pursuant to the Transaction exceeding 25% of the number of currently outstanding Shares of the Company on a non-diluted basis pursuant to 611(c) of the TSX Company Manual. As a result, the Transaction Resolution will require the affirmative vote of at least a simple majority of the Shareholders, present or represented by proxy at the Meeting, excluding the votes cast by BAT or its affiliates under subsections 604(a)(ii), 607(g)(ii), 611(b) and 611(c) of the TSX Company Manual.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Shareholders Meeting</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Further information regarding the Transaction and the Private Placement Financing will be contained in a management information circular that the Company will prepare and mail to its Shareholders in connection with the Meeting to be held on March 30, 2026. The Company expects to mail its management information circular in early March. A copy of the Company&#8217;s management information circular will be filed under the Company's profile at www.sedarplus.ca. </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Investor Presentation</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The Investor Presentation can be found at the attached link&#58; Investor Presentation. </font><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Item Six &#8211; Reliance on subsection 7.1(2) of National Instrument 51-102</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Not Applicable.</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Item Seven &#8211; Omitted Information</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">Not Applicable.</font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Item Eight &#8211; Executive Officer</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">The following executive officer is knowledgeable about the material change and this report&#58; </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">James Yamanaka, Chief Executive Officer </font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">1 (844)-644-4726</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:700;line-height:120%">Item Nine &#8211; Date of Report</font></div><div style="margin-bottom:12pt;text-align:justify"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%">March 2, 2026</font></div><div style="margin-bottom:18pt;text-align:justify"><font style="background-color:#fefefe;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:700;line-height:120%">Forward-Looking Information</font></div><div style="margin-bottom:6pt;margin-top:5pt;text-align:justify"><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:120%">This report contains forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as &#8220;plans&#8221;, &#8220;expects&#8221;, &#8220;estimates&#8221;, &#8220;intends&#8221;, &#8220;anticipates&#8221;, &#8220;believes&#8221; or variations of such words and phrases or state that certain actions, events, or results &#8220;may&#8221;, &#8220;could&#8221;, &#8220;would&#8221;, &#8220;might&#8221; or &#8220;will&#8221; be taken, occur or be achieved. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances contain forward-looking-statements. Forward-looking information involves known and unknown risks, uncertainties and other factors that may cause actual results, events, performance or achievements of the Company to differ materially from current expectations or future results, performance or achievements expressed or implied by the forward-looking information contained in this report. Specifically, statements regarding the expected closing of the Transaction, the sources of funds to finance the Transaction, the terms of the Private Placement Financing, the expected benefits of the Transaction and the future business prospects of the Company are forward-looking statements. </font></div><div style="margin-bottom:5pt;margin-top:5pt;text-align:justify"><font style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:120%">In making statements about Sanity&#8217;s financial performance, the Company has made assumptions that are based on presumed growth rates in Germany, Sanity continuing to hold one of the top market share positions, continued availability of flower supply from Canadian and other international cultivators, and market conditions, pricing and margins not deteriorating beyond the already forecasted reduction in gross margins.  Such assumptions are based on management's assessment of the relevant information currently available and any financial outlook included herein is provided for the purpose of helping readers understand management's current expectations and plans for the future as of the date hereof.</font></div><div style="margin-bottom:8pt;text-align:justify"><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:125%">Risks, uncertainties and other factors involved with forward-looking information could</font><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:700;line-height:125%"> </font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:125%">cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information. Forward-looking statements reflect current beliefs of management of the Company</font><font style="color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:125%"> </font><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:125%">with respect to future events and are based on information currently available to management including the reasonable assumptions, estimates, analysis and opinions of management of the Company considering their experience, perception of trends, current conditions and expected developments as well as other factors that  management believes to be relevant as at the date such statements are made, including, but not limited to, that shareholders will vote to approve the Transaction and the Private Placement </font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:8pt;text-align:justify"><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:125%">Financing, and that the conditions to closing the Transaction, the Private Placement Financing and the ATB Credit Facilities will be satisfied within a reasonable period of time or at all. Forward-looking statements involve significant known and unknown risks and uncertainties. Many factors could cause actual results, performance or achievement to be materially different from any future forward-looking statements. There is a risk that one or more of the Transaction, the Private Placement Financing and&#47;or the ATB Credit Facilities does not close or close within the expected timeline. There is a risk that some or all the expected benefits of the Transaction may fail to materialize or may not occur within the time periods anticipated by the Company. The challenge of coordinating previously independent businesses makes evaluating the business and future financial prospects of the Company following the business combination difficult. Material risks and uncertainties that could cause actual results to differ from forward-looking statements include not receiving approval for the Transaction and Private Placement Financing from the shareholders, not receiving any of the regulatory approvals (including approval from the TSX and foreign direct investment clearance from the German Ministry of Economics and Energy) required to close the Transaction and Private Placement Financing, the timing and outcome of any such regulatory review negatively impacting the Transaction, that all conditions to the closing of the Share Purchase Agreement will not be satisfied, that the Transaction will not be completed on the terms set forth in the Share Purchase Agreement, that the Transaction will not close, inherent uncertainty associated with the financial and other projections (including projections relating to revenue, EBITDA, valuation and earnout calculations) as well as market and regulatory changes arising that reduce or eliminate the benefits of the Transaction&#59; the effective integration of Sanity into the Company not being possible&#59; the ability to achieve the anticipated synergies and value-creation contemplated by the business combination not being possible or being delayed&#59; the response of business partners and retention as a result of the business combination being negative&#59; the impact of competitive responses to the business combination negatively impacting the Company&#59; the ability to achieve the expected manufacturing and production output not being possible&#59; availability of required flower supply&#59; the risk that Sanity may not achieve the financial performance thresholds required for the payment of some or all of the Earnout Cash Consideration and Earnout Share Consideration&#59; and the diversion of management time on business combination-related issues. Readers are cautioned that the foregoing list of factors is not exhaustive. Other risks and uncertainties not presently known to the Company or that the Company presently believe are not material could also cause actual results or events to differ materially from those expressed in the forward-looking statements contained herein. For a more detailed discussion of risks and other factors, see the factors and risks disclosed in the Company&#8217;s most recent annual information form, management&#8217;s discussion and analysis and other Company documents filed from time to time on SEDAR+ (see www.sedarplus.ca) and filed or furnished to the Securities and Exchange Commission on EDGAR (see www.sec.gov). Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release.</font></div><div style="margin-bottom:6pt;margin-top:5pt;text-align:justify"><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:120%">Although the Company believes that the assumptions and factors used in preparing the forward-looking information in this report are reasonable, undue reliance should not be placed on such information, and no assurance can be given that such events will occur in the disclosed time frames or at all. The forward-looking information included in this report are made as of the date </font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div><hr style="page-break-after:always"><div style="min-height:72pt;width:100%"><div style="margin-bottom:12pt;text-align:right"><font style="color:#000000;font-family:'Times New Roman',serif;font-size:12pt;font-weight:400;line-height:120%"> </font></div></div><div style="margin-bottom:6pt;margin-top:5pt;text-align:justify"><font style="background-color:#ffffff;color:#212529;font-family:'Times New Roman',serif;font-size:12pt;font-style:italic;font-weight:400;line-height:120%">of this report and the Company disclaims any intention or obligation, except to the extent required report, to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.</font></div><div style="margin-bottom:18pt;text-align:justify"><font><br></font></div><div style="height:72pt;position:relative;width:100%"><div style="bottom:0;position:absolute;width:100%"><div style="margin-bottom:12pt"><font><br></font></div></div></div></body></html>
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