$CNPOF Mails Circular for Special Meeting of Shareholders and Announces Receipt of Interim Court Order for Plan of Arrangement

TORONTO , Jan. 20, 2021 – Canopy Rivers Inc. (” Rivers ” or the ” Company “) (TSX: RIV) (OTC: CNPOF) today filed and mailed the management information circular (the ” Circular “) and related materials in connection with the special meeting (the ” Meeting “) of shareholders to be held virtually on February 16, 2021 at 10:00 a.m. ( Toronto time).

In light of the ongoing coronavirus pandemic and to mitigate against its risks, the Meeting will be held in a virtual only format via live audio webcast, available to all stakeholders at http://web.lumiagm.com/261351529 , password “canopy2021” (case sensitive). During the audio webcast, shareholders will be able to hear the Meeting live, and registered shareholders and duly appointed and registered proxyholders will be able to submit questions and vote while the Meeting is being held.

At the Meeting, shareholders will be asked to consider and, if deemed advisable, to pass a special resolution approving the previously announced plan of arrangement (the ” Transaction “) with Canopy Growth Corporation (” Canopy Growth “) (TSX: WEED, NASDAQ: CGC), pursuant to which Rivers will transfer three portfolio assets to Canopy Growth in exchange for $115 million in cash, 3,750,000 common shares ¹ in Canopy Growth, and the cancellation of all the multiple voting shares (” MVS “) and subordinate voting shares (” SVS “) of Rivers held by Canopy Growth. As part of the Transaction, the Company will also change its corporate name to “RIV Capital Inc.”

In addition, Rivers is pleased to announce that on January 14, 2020 , it was granted an interim order by the Ontario Superior Court of Justice (Commercial List) (the ” Court “) authorizing various matters, including the holding of the Meeting and the mailing of the Circular.

The Company’s board of directors, other than certain conflicted directors (the ” Board “), unanimously approved the Transaction following a unanimous recommendation of a special committee, which was composed of directors independent of Canopy Growth, TerrAscend Corp. (” TerrAscend “) and management of Rivers. Both the special committee and the Board determined that the Transaction is fair to, and in the best interests of, the Company and unanimously recommend that shareholders vote in favour of the Transaction at the Meeting.

Benefits to Rivers Shareholders

Rivers believes the Transaction will propel the Company to its next phase of growth. The Company believes the Transaction will provide the following benefits, among others:

• Enables the Company to access new investment opportunities: Upon completion of the Transaction, the Company will be in a position to comprehensively re-evaluate its business and investment strategy and pursue previously unavailable opportunities, and in particular, investments in, or acquisitions of, opportunities in the U.S. market. As such investments or acquisitions may be inconsistent with the policies of the TSX, the Company is initiating the process to de-list from the TSX and list its securities on a stock exchange that does not prohibit such investments or acquisitions.
• Unlocks value for the Company: The Transaction allows the Company to unlock and realize the value of the TerrAscend exchangeable shares, which have significant liquidity restrictions and the value of which has not been adequately reflected in the Company’s share price, as well as its interest in Les Serres Vert Cannabis Inc., a private company for which there is no published market.
• Provides significant value and liquidity for the Company: The consideration payable by Canopy Growth pursuant to the Transaction is comprised of cash and highly liquid securities, which provides the Company with significant value and liquidity at a price that may not be available in the short to medium term in the absence of the Transaction, particularly in an uncertain economic and market environment. The Company will also have significant capital to pursue potential material investments in, or acquisitions of, established operating businesses in the U.S. cannabis market, many of which continue to experience uncertain and constrained access to capital.
• Eliminates the Company’s dual-class share structure: Upon closing of the Transaction, the Company and its shareholders will derive a number of benefits associated with the elimination of the Company’s dual class share structure, including that:
  • shareholders will have a vote that is proportionate to their relative economic interest in the Company; and
  • the Company’s shares will be more attractive for purposes of raising capital or as an acquisition currency.

Meeting Materials
Shareholders should refer to the Circular and related materials for detailed instructions on how to vote and participate at the Meeting. The Circular also contains important information regarding the Transaction, and a summary of the events leading up to the Transaction, including the reasons that led the Board to determine that the Transaction is fair to Rivers and in the best interest of the Company. The Circular and related materials are available on the Company’s profile at www.sedar.com .

Shareholders can also view the Transaction details in a presentation prepared by the Company, available at www.canopyrivers.com/investors .

Meeting Details
The Transaction requires the approval of at least (a) two-thirds of the votes cast by both: (i) Canopy Growth as the holder of all of the MVS; and (ii) Rivers shareholders that hold SVS, and (b) a simple majority of the votes cast by holders of SVS, excluding the votes attached to the SVS held by Canopy Growth. Canopy Growth has agreed to vote all of its MVS and SVS in favour of the Transaction.

Funds managed by JW Asset Management, the Company’s largest holder of SVS, and each of the Company’s directors and executive officers, which in aggregate represent approximately 24.5% of the outstanding SVS, excluding the SVS held by Canopy Growth, have entered into voting support agreements agreeing to vote their SVS in favour of the Transaction.

Shareholders who are unable to virtually attend the Meeting are encouraged to complete, sign, date and return the form of proxy or voting instruction form provided with the meeting materials so that as many shareholders as possible are represented at the Meeting.

For any questions or assistance with voting their proxies, shareholders should contact Kingsdale Advisors, the strategic shareholder advisor and proxy solicitation agent, by telephone at 1-800-749-9052 (416-867-2272 for collect calls outside of North America ) or by email at contactus@kingsdaleadvisors.com .

About Canopy Rivers
Canopy Rivers is a venture capital firm specializing in cannabis with a portfolio of 17 companies across various segments of the cannabis value chain. We believe that bringing together people, capital, and ideas raises the potential of the entire cannabis industry. By leveraging our industry insights, in-house expertise, and thesis-driven approach to investing, we aim to provide shareholders with exposure to specialized and disruptive cannabis companies. Our mission is to invest in innovators across the cannabis value chain, help them grow, and ultimately create value by guiding these companies towards a monetization event. Together with our portfolio, we are helping build the cannabis industry of tomorrow, today.

Forward Looking Statements
This news release contains statements which constitute “forward-looking information” within the meaning of applicable securities laws, including statements regarding the plans, intentions, beliefs and current expectations of Canopy Rivers with respect to future business activities and operating performance. To the extent any forward-looking information in this news release constitutes “financial outlooks” within the meaning of applicable Canadian securities laws, the reader is cautioned that this information may not be appropriate for any other purpose and the reader should not place undue reliance on such financial outlooks. Forward-looking information is often identified by the words “may”, “would”, “could”, “should”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” or similar expressions, and forward-looking information in this news release includes, but is not limited to, information and statements regarding: whether and when the Transaction will be consummated; the anticipated benefits of the Transaction, the Company’s expectation that the Transaction will significantly strengthen the Company’s capital and liquidity position, the anticipated cash proceeds from the Transaction net of the associated tax liability and transaction costs, the anticipated benefits associated with the elimination of the Company’s dual class share structure; the attractiveness of the Company’s shares as acquisition currency following the Transaction; the price and liquidity of the Canopy Growth common shares; the Company’s intention to invest, acquire and/or merge with operating U.S. cannabis companies and the value to be derived therefrom; the Company’s belief that operating businesses in the U.S. cannabis market experience uncertain and constrained access to capital; the possibility that the Company may de-list from the TSX following completion of the Transaction and list its securities on a stock exchange that permits investments in and/or acquisitions of U.S. cannabis companies; the anticipated timing of the Meeting and the requisite shareholder approvals to be obtained at the Meeting; the Company obtaining and/or satisfying customary approvals and conditions, including court approval for the Transaction; and expectations for other economic, business, and/or competitive factors.

Investors are cautioned that forward-looking information is not based on historical fact but instead reflects management’s expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. Although the Company believes that the expectations reflected in such forward-looking information are reasonable, such information involves risks and uncertainties, and undue reliance should not be placed on such information, as unknown or unpredictable factors could have material adverse effects on future results, performance or achievements of the Company. Financial outlooks, as with forward-looking information generally, are, without limitation, based on the assumptions and subject to various risks as set out herein.

Among the key factors that could cause actual results to differ materially from those projected in the forward-looking information are the following: the parties’ ability to consummate the Transaction; the ability to receive, in a timely manner and on satisfactory terms, all necessary regulatory, court, shareholder, and other third party approvals; the ability of the parties to satisfy, in a timely manner, all other conditions to the closing of the Transaction; the potential impact of the announcement or consummation of the Transaction on relationships, including with regulatory bodies, stock exchanges, lenders, employees and competitors; the diversion of management time on the Transaction; assumptions concerning the Transaction and the operations and capital expenditure plans of the Company following completion of the Transaction; credit, liquidity and additional financing risks for the Company and its investees; stock market volatility; regulatory and licensing risks; changes in cannabis industry growth and trends; changes in the business activities, focus and plans of the Company and its investees and the timing associated therewith; the Company’s actual financial results and ability to manage its cash resources; changes in general economic, business and political conditions, including challenging global financial conditions and the impact of the novel coronavirus pandemic; competition risks; potential conflicts of interest; the regulatory landscape and enforcement related to cannabis, including political risks and risks relating to regulatory change; changes in applicable laws; changes in the global sentiment towards, and public opinion of, the cannabis industry; divestiture risks; competition risks; and the risk factors set out in the Circular and Canopy Rivers’ annual information form dated June 2, 2020 , filed with the Canadian securities regulators and available on Canopy Rivers’ profile on SEDAR at www.sedar.com .

Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties and factors that could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. The Company does not intend, and does not assume any obligation, to update this forward-looking information except as otherwise required by applicable law.