Mr. Irwin Simon of Tilray reports

CREATES CANADA'S LARGEST CANNABIS COMPANY BY REVENUE AND INCREASES TILRAY'S #1 LEADING CANNABIS SHARE BY 44 PER CENT WITH ~13 PER CENT PRO FORMA MARKET SHARE; ACCELERATES REALIZATION OF OPERATING AND COST SYNERGIES IN EXCESS OF US$27 MILLION

Tilray Brands Inc. has completed its previously announced acquisition of Hexo Corp. by way of plan of arrangement.

The Hexo acquisition provides several key strategic benefits, including:

• Creates largest Canadian cannabis LP by revenue, strengthening Tilray's No. 1 market share position. Tilray expands its leading cannabis market share position in Canada with pro forma cannabis market share increasing by 467 basis points to approximately 13 per cent for the quarter ended May 31, 2023, including the No. 1 position in almost all markets.

• From a category perspective, Tilray becomes No. 1 in flower (40-per-cent market share with an extensive combined genetics library to fuel product innovation and growth), oils and concentrates, and No. 2 in prerolls (29-per-cent market share), No. 4 in vape and top 10 in all other categories.

• Establishes unrivaled portfolio of high-growth brands. Tilray amplifies its market-leading offering and substantially expands its base of consumers and patients with a portfolio consisting of the highest growth consumer and medical brands in the Canadian cannabis market across the premium, mainstream and value segments.

• Tilray's newly combined brand portfolio now includes Canada's top-selling brands such as Good Supply, RIFF, Broken Coast, Solei, Canaca, Hexo, Redecan, Original Stash and Bake Sale, among others.

• Enhances Tilray's position in growing premium preroll Segment. Hexo's state-of-the-art production process provides significant opportunities for Tilray to meet growing consumer demand for premium preroll and cone-style cannabis products, representing a significant margin opportunity in a category which is expected to surpass flower on a revenue basis.

• Fortifies commercial network through collective sales, marketing and distribution force. Tilray and Hexo will optimize their sales, marketing and distribution networks to strengthen Tilray's commercial footprint and hasten market share growth.

• Enables accelerated cost savings and earnings growth. With this acquisition, Tilray expects to achieve additional cost savings in excess of $27-million (U.S.) on an annualized pretax basis, driven by synergies across production, sales, marketing, distribution and corporate savings, with potential incremental upside resulting from consolidating packaging, procurement, freight and logistics. This work builds on Tilray's substantial progress optimizing its operations including improving distribution capabilities while also achieving significant reductions in costs related to transportation, waste and other factors, and growing cannabis potencies to 25 per cent on average.

• Scaled platform empowers Tilray to stay ahead in rapidly consolidating market. The combined organization is expected to result in increased economies of scale to succeed in today's increasingly competitive and rapidly consolidating cannabis market.

Irwin D. Simon, Tilray Brands' chairman and chief executive officer, said: "Acquiring Hexo boosts Tilray's competitive positioning in the largest, federally legalized cannabis market in the world and, we believe, marks the next evolution of Canadian cannabis. Having already established ourselves as the clear leader in Canada through an unparalleled portfolio of consumer and medical brands, continuous product innovation, and the lowest-cost production as well as industry-leading extraction capabilities, this transaction affirms and builds on our enviable standing by bringing Hexo's leading cannabis brands into our state-of-the-art operations. Together, we expect to deliver revenue growth, margin contribution and value creation for shareholders."

Blair MacNeil, president, Tilray Canada, added: "We are relentlessly focused on growing market share strategically and winning in Canada and will leverage this acquisition to substantially expand our consumer base, serve new segments and additional occasions. To best take advantage of this opportunity, we are revamping our sales approach to drive education and awareness as we integrate Hexo's production to generate even greater value from our leading operational processes. Taken together, we intend to capitalize on the commercial and financial benefits that are inherent in combining Hexo with Tilray. These include accelerating the optimization of our operations, sales and marketing efforts that are already under way. We look forward to our future with great excitement."

Effective on closing, Tilray's Canadian leadership team, led by Mr. MacNeil and Carl Merton, chief financial officer, will provide a strong foundation for the combined company to accelerate growth and capitalize on the strategic financial, operational and commercial benefits.

Advisers

Canaccord acted as financial adviser, and DLA Piper acted as external legal counsel to Tilray Brands.

Early warning disclosure

Prior to the arrangement, Tilray Brands held a senior secured convertible note of Hexo with an outstanding principal balance of $173.7-million, which was convertible into approximately 48 per cent of the outstanding shares of common stock of Hexo, on a non-diluted basis. On completion of the arrangement, Tilray Brands holds 100 per cent of the outstanding Hexo shares, including 100 per cent of the outstanding Hexo common shares and 100 per cent of the outstanding Series 1 preferred shares of Hexo. The Hexo common shares were acquired by Tilray Brands in exchange for the issuance of 0.4352 of a share of Tilray common stock for each whole Hexo common share held. Tilray Brands also issued 19,551,282 Tilray shares in consideration for the acquisition of the 25 million issued and outstanding Series 1 preferred shares of Hexo. As a result of the arrangement, Hexo is a wholly owned subsidiary of Tilray Brands. As such, it is expected that the Hexo common shares will be delisted from the Toronto Stock Exchange and Nasdaq promptly. An early warning report will be filed by Tilray Brands on SEDAR in accordance with applicable securities laws. A copy of the early warning report filed by Tilray Brands will be available under Tilray's profile on SEDAR, or by contacting Tilray 844-845-7291 or legal@tilray.com.

About Tilray Brands Inc.

Tilray Brands is a leading global cannabis-lifestyle and consumer packaged goods company with operations in Canada, the United States, Europe, Australia and Latin America that is changing people's lives for the better -- one person at a time. Tilray Brands delivers on this mission by inspiring and empowering the worldwide community to live their very best life, enhanced by moments of connection and well-being. Patients and consumers trust Tilray Brands to be the most responsible, trusted and market leading cannabis consumer products company in the world with a portfolio of innovative, high-quality and beloved brands that address the needs of the consumers, customers and patients it serves. A pioneer in cannabis research, cultivation and distribution, Tilray Brands' unprecedented production platform supports over 20 brands in over 20 countries, including comprehensive cannabis offerings, hemp-based foods and craft beverages.

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