Exhibit 10.10

EXECUTION VERSION

CONSENT AGREEMENT

Dated April 18, 2019

between

CBG HOLDINGS LLC

and

CANOPY GROWTH CORPORATION

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TABLE OF CONTENTS

 

     Page  

ARTICLE 1 DEFINITIONS

     2  

1.1

   Definitions      2  

1.2

   Schedules and Exhibits      7  

ARTICLE 2 CONSENT AND OTHER TRANSACTIONS

     7  

2.1

   Consent to Project Frontrunner      7  

2.2

   Amendment and Restatement of Warrants      8  

2.3

   Repurchase of Common Shares      8  

2.4

   Company Covenants Regarding Project Frontrunner      9  

2.5

   Trademark and Technology License      9  

2.6

   Voting Support Agreements      10  

ARTICLE 3 REPRESENTATION AND WARRANTIES

     10  

3.1

   Representations and Warranties of the Company      10  

3.2

   Representations and Warranties of CBG      10  

ARTICLE 4 CONDITIONS PRECEDENT

     10  

4.1

   Company’s Conditions Precedent for the Closing      10  

4.2

   CBG Conditions Precedent for Closing      11  

ARTICLE 5 COVENANTS

     12  

5.1

   Actions to Satisfy Closing Conditions      12  

5.2

   Consents, Approvals and Authorizations      12  

5.3

   Company Approval      13  

5.4

   Company Circular      13  

5.5

   Company Meeting      15  

5.6

   Interim Period Covenants      16  

5.7

   CBG Acquisitions      16  

ARTICLE 6 TERMINATION

     16  

6.1

   Termination      16  

ARTICLE 7 GENERAL PROVISIONS

     17  

7.1

   Governing Law      17  

7.2

   Notices      17  

7.3

   Expenses      18  

7.4

   Severability      18  

7.5

   Entire Agreement      18  

7.6

   Assignment; No Third-Party Beneficiaries      18  

7.7

   Amendment; Waiver      18  

7.8

   Injunctive Relief      19  

7.9

   Rules of Construction      19  

7.10

   Currency      19  

 

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TABLE OF CONTENTS

(continued)

 

     Page  

7.11

   Further Assurances      19  

7.12

   Public Notices/Press Releases      20  

7.13

   Public Disclosure      20  

7.14

   Counterparts      20  

 

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CONSENT AGREEMENT

THIS CONSENT AGREEMENT, dated April 18, 2019 (this “Agreement”), is made by and
between CBG Holdings LLC, a limited liability company existing under the laws of
the State of Delaware (“CBG”) and Canopy Growth Corporation, a corporation
existing under the federal laws of Canada (the “Company”).

RECITALS

 

(A)

On November 2, 2017, GCILP purchased from the Company: (i) 18,876,901 Common
Shares; and (ii) 18,876,901 Initial Warrants.

 

(B)

On November 1, 2018, CBG, an affiliate of GCILP, purchased from the Company: (i)
104,500,000 Common Shares; and (ii) 139,745,453 Warrants.

 

(C)

The Company proposes to enter into the Arrangement Agreement (including the Plan
of Arrangement) to undertake the Arrangement on the terms and conditions more
particularly set forth in the Arrangement Agreement (“Project Frontrunner”).

 

(D)

Pursuant to the Amended and Restated Investor Rights Agreement, the entering
into of the Arrangement Agreement by the Company, and the completion of Project
Frontrunner, are subject to the prior written consent of CBG.

 

(E)

CBG and the Company wish to enter into this Agreement for the purposes of
setting forth the agreements and understandings with respect to the terms and
conditions upon which CBG is prepared to grant its consent to Project
Frontrunner.

 

(F)

The transactions contemplated by this Agreement require the approval of the
Company Shareholders pursuant to the rules of the TSX and MI 61-101.

 

(G)

The Board (other than directors, if any, who abstained from voting on the
transactions contemplated by this Agreement) has unanimously determined, after
receiving financial and legal advice, that the transactions contemplated by this
Agreement are in the best interests of the Company and fair to the Company
Shareholders (other than CBG and its affiliates) and has resolved to recommend
that the Company Shareholders vote in favour of the transactions contemplated by
this Agreement, all subject to the terms and conditions contained in this
Agreement.

 

(H)

Concurrently with the execution and delivery of this Agreement, the Parties and
GCILP entered into the Second Amended and Restated Investor Rights Agreement.

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
contained herein and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the Parties hereby agree as follows:

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ARTICLE 1

DEFINITIONS

 

1.1

Definitions

Whenever used in this Agreement, the following terms shall have the meanings set
forth below:

“Affiliate” means, with respect to any Person, any Person now or hereafter
existing, directly or indirectly, Controlled by, Controlling, or under common
Control with, such Person, whether on or after the date hereof.

“Agreement” has the meaning ascribed to such term in the Preamble.

“Amended and Restated Investor Rights Agreement” means the amended and restated
investor rights agreement dated November 1, 2018 entered into between CBG, GCILP
and the Company.

“Amended Warrants” means the Tranche A Amended Warrants, the Tranche B Amended
Warrants and the Tranche C Amended Warrants to be entered into, issued and
delivered on Closing.

“Applicable Law” means, with respect to any Person, property, transaction, event
or other matter, (a) any foreign or domestic constitution, treaty, law, statute,
regulation, code, ordinance, principle of common law or equity, rule, municipal
by-law, Order or other requirement having the force of law and/or (b) any
policy, practice, protocol, standard or guideline of any Governmental Authority
which, although not necessarily having the force of law, is regarded by such
Governmental Authority as requiring compliance as if it had the force of law
(collectively, the “Law”) relating or applicable to such Person, property,
transaction, event or other matter and also includes, where appropriate, any
interpretation of the Law (or any part thereof) by any Person having
jurisdiction over it, or charged with its administration or interpretation.

“Approval Resolution” means the resolution of the Company Shareholders which is
to be considered at the Company Meeting with respect to the transactions
contemplated by this Agreement, including the approval of the amendment and
restatement of the Warrants, the Share Issuance Proposal and the Top-Up
Resolution, substantially in the form attached as Exhibit B.

“Arrangement” means the arrangement under Section 288 of the Business
Corporations Act (British Columbia) on the terms and subject to the terms and
conditions set out in the Plan of Arrangement, subject to any amendments or
variations to the Plan of Arrangement, made in accordance with the terms of the
Arrangement Agreement or the Plan of Arrangement.

“Arrangement Agreement” means the arrangement agreement dated the same date as
this Agreement entered into between the Company and Frontrunner, including the
schedules thereto, providing for, among other things, the Arrangement, as the
same may be amended, supplemented or restated.

“Board” means the board of directors of the Company from time to time.

 

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“Business Day” means a day other than a Saturday, Sunday or other day on which
commercial banks in Smiths Falls, Ontario are authorized or required by Law to
close. Any event the scheduled occurrence of which would fall on a day that is
not a Business Day shall be deferred until the next succeeding Business Day.

“Canadian Securities Regulators” means, collectively, the securities commissions
or other securities regulatory authorities in each of the Qualifying Provinces.

“Cannabis ” and “cannabis” means (i) all living or dead material, plants, seeds,
plant parts or plant cells from any cannabis species or subspecies (including
sativa, indica and ruderalis), including wet and dry material, trichomes, oil
and extracts from cannabis (including cannabinoid or terpene extracts from the
cannabis plant), and (ii) biologically or synthetically synthesized analogs of
cannabinoids extracted from the cannabis plant using micro-organisms, including
but not limited to (A) cannabis and marijuana, as defined pursuant to Applicable
Law, including the Cannabis Act and (B) Industrial Hemp as defined in the
Industrial Hemp Regulations issued under the Cannabis Act or other Applicable
Law.

“Cannabis Act” means S.C. 2018, c.16, “An Act respecting cannabis and to amend
the Controlled Drugs and Substances Act, the Criminal Code and other Acts”
(Canada), as amended from time to time and as the same may come into force.

“CBG Group” means CBG, GCILP and their Affiliates.

“Closing ” means the closing of the issuance, execution and delivery of the
Amended Warrants pursuant to and in accordance with the terms and conditions of
this Agreement.

“Common Share” means a common share in the capital of the Company or such other
shares or other securities into which such common share is converted, exchanged,
reclassified or otherwise changed, as the case may be, from time to time.

“Company” has the meaning ascribed to such term in the Preamble.

“Company Board Recommendation” has the meaning ascribed to such term in
Section 5.4(c).

“Company Circular” means the notice of the Company Meeting to be sent to the
Company Shareholders and the accompanying management information and proxy
circular, including all schedules, appendices and exhibits thereto and
enclosures therewith, to be sent to the Company Shareholders in connection with
the Company Meeting, as amended, supplemented or otherwise modified from time to
time.

“Company Meeting” means the special meeting of Company Shareholders to be called
and held in accordance with applicable Law to consider certain matters in
respect of Project Frontrunner and the Approval Resolution.

“Company Shareholders” means the holders of Common Shares.

“Contract” means any agreement, indenture, contract, lease, deed of trust,
licence, option, instruments, arrangement, understanding or other commitment,
whether written or oral.

 

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“Control” means:

 

  (a)

in relation to a corporation, the direct or indirect beneficial ownership at the
relevant time of shares of such corporation carrying more than 50% of the voting
rights ordinarily exercisable at meetings of shareholders of the Company where
such voting rights are sufficient to elect a majority of the directors of the
Company;

 

  (b)

in relation to a Person that is a partnership, limited liability company or
joint venture, the direct or indirect beneficial ownership at the relevant time
of more than 50% of the ownership interests of the partnership, limited
liability company or joint venture in circumstances where it can reasonably be
expected that the Person can direct the affairs of the partnership, limited
liability company or joint venture; and

 

  (c)

in relation to a trust, the direct or indirect beneficial ownership at the
relevant time of more than 50% of the property settled under the trust;

and the words “Controlled by”, “Controlling” and similar words have
corresponding meanings; the Person who directly or indirectly Controls a
Controlled Person or entity shall be deemed to Control a corporation,
partnership, limited liability company, joint venture or trust which is
Controlled by the Controlled Person or entity, and so on.

“Court” means the Supreme Court of British Columbia.

“Depositary” has the meaning ascribed to such term in the Arrangement Agreement.

“Effective Date” has the meaning ascribed to such term in the Arrangement
Agreement.

“Fairness Opinion” means the opinion of Greenhill & Co. Canada Ltd., the
financial advisor to the Company, to the effect that as of the date of such
opinion, subject to the assumptions and limitations to be set out in the written
opinion related thereto, the transactions contemplated by this Agreement are
fair, from a financial point of view, to the Company.

“Frontrunner” means Acreage Holdings, Inc., a corporation existing under the
laws of the Province of British Columbia.

“GCILP” means Greenstar Canada Investment Limited Partnership, a limited
partnership existing under the laws of the Province of British Columbia.

“Governmental Authority” means:

 

  (a)

any domestic or foreign government, whether national, federal, provincial,
state, territorial, municipal or local (whether administrative, legislative,
executive or otherwise);

 

  (b)

any domestic or foreign agency, authority, ministry, department, regulatory
authority, court, central bank, bureau, board or other instrumentality having
legislative, judicial, taxing, regulatory, prosecutorial or administrative
powers or functions of, or pertaining to, government, including: (i) Health
Canada and other applicable regulatory authorities with oversight of the
Cannabis industry and any business or operations within the Cannabis industry
generally; (ii) the United States Alcohol and Tobacco Tax and Trade Bureau; and
(iii) the United States Department of Justice;

 

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  (c)

any court, commission, individual, arbitrator, arbitration panel or other body
having adjudicative, regulatory, judicial, quasi-judicial, administrative or
similar functions; and/or

 

  (d)

the TSX, the NYSE and any other stock or securities exchange, marketplace or
trading market upon which the Company has sought and obtained listing of its
securities.

“Initial Warrants” means the Common Share purchase warrants issued by the
Company to GCILP in connection with the private placement transactions completed
on November 2, 2017, with each Initial Warrant entitling GCILP to acquire one
Common Share for the exercise price set forth therein.

“Material Adverse Effect” means any change (including a decision to implement
such a change made by the Board or by senior management who believe that
confirmation of the decision of the Board is probable), event, violation,
inaccuracy, circumstance, development or effect that is, individually or in the
aggregate, or would reasonably be expected to be, individually or in the
aggregate, materially adverse to the business, assets (including intangible
assets), capitalization, liabilities (contingent or otherwise), condition
(financial or otherwise), prospects or results of operations of the Company,
taken as a whole, whether or not arising in the ordinary course of business.

“MI 61-101” means Multilateral Instrument 61-101 – Protection of Minority
Security Holders in Special Transactions of the Canadian Securities
Administrators.

“Misrepresentation” has the meaning ascribed to such term under Securities Laws.

“NYSE” means the New York Stock Exchange.

“Order” means any order, directive, judgment, decree, injunction, decision,
ruling, award or writ of any Governmental Authority.

“Outside Date” means August 31, 2019 or such later date as may be agreed to by
the Parties in writing.

“Parties” means CBG and the Company, and a “Party” means either of them.

“Person” means any individual, corporation, partnership, firm, joint venture,
association, joint-stock company, trust, unincorporated organization,
Governmental Authority or other entity.

“Plan of Arrangement” means the plan of arrangement attached as Schedule A to
the Arrangement Agreement, subject to any amendments or variations made in
accordance with the terms of the Arrangement Agreement or the Plan of
Arrangement.

“Purchaser Call Option” has the meaning ascribed to such term in the Plan of
Arrangement.

 

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“Purchaser Call Option Exercise Notice” has the meaning ascribed to such term in
the Plan of Arrangement.

“Project Frontrunner” has the meaning ascribed to such term in the Preamble.

“Qualifying Provinces” means, collectively, all of the provinces of Canada
except Québec.

“Regulatory Approval” means (i) approval of the TSX of the transactions
contemplated by this Agreement, including amendment of the Tranche A Warrants
and Tranche B Warrants and the exercise price for the Amended Warrants and the
listing on the TSX of all Common Shares referred to hereunder; (ii) supplemental
listing approval of the NYSE for the issuance and listing on the NYSE of the
Common Shares referred to hereunder; and (iii) any other approval which may be
required to give effect to the consummation of the transactions contemplated by
this Agreement in accordance with Applicable Law, or by or from any Governmental
Authority, as determined by CBG, acting reasonably.

“Repurchase Period” has the meaning ascribed to such term in Section 2.3(a).

“Second Amended and Restated Investor Rights Agreement” means the second amended
and restated investor rights agreement between CBG, GCILP and the Company dated
the date of this Agreement.

“Securities Laws” means, collectively, the applicable securities laws of each of
the provinces and territories of Canada and the respective regulations,
instruments and rules made under those securities laws, together with all
applicable published policy statements, notices, blanket orders and rulings of
the securities commissions or securities regulatory authorities of Canada and of
each of the provinces and territories of Canada and applicable U.S. securities
laws.

“Share Issuance Proposal” means the ordinary resolution of Company Shareholders
approving the issuance of Common Shares pursuant to the Plan of Arrangement and
in connection with the Arrangement.

“Shareholder Approval” means the requisite approval of the Approval Resolution
by a simple majority of the votes cast on the Approval Resolution by the Company
Shareholders present in person or represented by proxy at the Company Meeting
(excluding the votes cast by CBG, GCILP and any other Company Shareholders that
are required to be excluded in accordance with the requirements of the TSX, NYSE
and MI 61-101).

“Top-Up Resolution” means the issuance by the Company of Common Shares that CBG
and/or GCILP has the right to subscribe for under the Investor Rights Agreement
based on the Common Shares issuable under the Arrangement.

“Trademark and Technology License” has the meaning ascribed to that term in the
Arrangement Agreement.

“Tranche A Amended Warrants” means the Amended Warrants to be issued pursuant to
Section 2.2 to be designated as “Tranche A common share purchase warrants”.

“Tranche A Warrants” means the Warrants designated as “Tranche A common share
purchase warrants”.

 

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“Tranche B Amended Warrants” means the Amended Warrants to be issued pursuant to
Section 2.2 to be designated as “Tranche B common share purchase warrants”.

“Tranche B Warrants” means the Warrants designated as “Tranche B common share
purchase warrants”.

“Tranche C Amended Warrants” means the Amended Warrants to be issued pursuant to
Section 2.2 to be designated as “Tranche C common share purchase warrants”.

“Transaction Agreements” means this Agreement, the Second Amended and Restated
Investor Rights Agreement and the Amended Warrants.

“Triggering Event Date” has the meaning ascribed to such term in the Plan of
Arrangement.

“TSX” means the Toronto Stock Exchange.

“Underlying Shares” means Common Shares for which, as applicable, the Warrants
and/or the Amended Warrants are exercisable.

“Violation” has the meaning ascribed to such term in Section 2.5.

“Warrant” means a Tranche A Warrant and/or a Tranche B Warrant, in each case,
issued by the Company to CBG on November 1, 2018, and entitling CBG to acquire
one Common Share per Warrant for the applicable exercise price set forth
therein.

 

1.2

Schedules and Exhibits

The following schedules and exhibits form an integral part of this Agreement:

 

Schedule A    –    Purchaser Representations and Warranties Schedule B    –   
Company’s Representations and Warranties Exhibit A    –    Forms of Warrant
Certificates       - Amended and Restated Tranche A Warrant Certificate       -
Amended and Restated Tranche B Warrant Certificate       - Tranche C Warrant
Certificate Exhibit B    –    Approval Resolution Exhibit C    –    Form of
Voting Support Agreement

ARTICLE 2

CONSENT AND OTHER TRANSACTIONS

 

2.1

Consent to Project Frontrunner

CBG hereby grants its consent to the entering into of the Arrangement Agreement
and the completion of Project Frontrunner, subject to the terms and conditions
set forth in, and the Closing of the transactions contemplated by, this
Agreement.

 

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2.2

Amendment and Restatement of Warrants

 

  (a)

On the Effective Date, the Company will issue the Amended Warrants to CBG in
exchange for the certificates representing the Warrants.

 

  (b)

The Amended Warrants shall be in the forms attached as Exhibit A.

 

2.3

Repurchase of Common Shares

 

  (a)

At any time and from time to time during the period commencing on the date
hereof and ending on the date that is 24 months after the date that all of the
Tranche A Warrants have been exercised by CBG (the “Repurchase Period”), the
Company shall purchase for cancellation, whether by way of normal course issuer
bid, substantial issuer bid, self tender offer, or otherwise, the lesser of:

 

  (i)

27,378,866 Common Shares (subject to customary adjustments for share splits,
consolidations or other changes to the outstanding share capital of a similar
nature); and

 

  (ii)

that number of Common Shares that can be purchased during the Repurchase Period
in consideration for an aggregate purchase price of $1,582,995,262.

 

  (b)

The Company shall provide a report to CBG on a quarterly basis confirming the
aggregate number of Common Shares purchased for cancellation and the average
purchase price therefor.

 

  (c)

If, for any reason, the Company has not within the Repurchase Period, purchased
for cancellation Common Shares required to be purchased pursuant to
Section 2.3(a), the Company hereby agrees and acknowledges that CBG will be
credited an amount (the “Credit Amount”) that will reduce the aggregate exercise
price otherwise payable by CBG upon each exercise of either: (i) prior to the
Effective Date, the Tranche B Warrants; or (ii) on or following the Effective
Date, the Tranche B Amended Warrants and/or Tranche C Amended Warrants, as the
case may be, equal to the difference between:

 

  (i)

$1,582,995,262; and

 

  (ii)

the actual purchase price paid by the Company in purchasing Common Shares
pursuant to Section 2.3(a).

 

  (d)

Each of the Parties acknowledges that the agreements contained in Section 2.3(c)
are an integral part of the transactions contemplated in this Agreement and that
without these agreements, the other Party would not enter into this Agreement.
If CBG exercises its Tranche B Warrants, Tranche B Amended Warrants and/or
Tranche C Amended Warrants and receives the full amount of the credit owing
pursuant to Section 2.3(c), the Credit Amount shall be deemed to be liquidated
damages which are a genuine pre-estimate of the losses or damages which CBG will
have suffered or incurred as a result of a failure of the Company to satisfy its
purchase obligations in Section 2.3(a), and are not penalties. The Company
irrevocably waives any right it may have to raise as a defence that any such
liquidated damages are excessive or punitive.

 

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  (e)

Notwithstanding any other provision of this Agreement, if the Effective Date
shall have occurred, this Section 2.3 shall indefinitely survive any termination
of this Agreement.

 

2.4

Company Covenants Regarding Project Frontrunner

The Company covenants and agrees that without the prior written consent of CBG,
such consent not to be unreasonably withheld, and notwithstanding anything to
the contrary contained in the Arrangement Agreement:

 

  (a)

the Company will not exercise the Purchaser Call Option prior to the Triggering
Event Date;

 

  (b)

the Company will not deliver the Purchaser Call Option Exercise Notice to the
Depositary prior to the Triggering Event Date;

 

  (c)

the Company will not amend, modify, supplement or restate the Arrangement
Agreement (including the Plan of Arrangement); and

 

  (d)

the Company will not waive any terms, covenants or conditions set forth in the
Arrangement Agreement (including the Plan of Arrangement).

 

2.5

Trademark and Technology License

The Company agrees that if at any time:

 

  (a)

the CBG Group has received any notification or communication (whether orally or
in writing) from a Governmental Authority of any violation or contravention of
Applicable Law or any liability to the CBG Group under Applicable Law;

 

  (b)

the CBG Group has received any notification or communication (whether orally or
in writing) from a Governmental Authority, which the CBG Group has determined,
in its sole discretion, would be expected to result in a violation or
contravention of Applicable Law or any actual liability to the CBG Group under
Applicable Law; or

 

  (c)

there has been a change in Applicable Law, or the interpretation or application
of Applicable Law by any Governmental Authority, which the CBG Group has
determined, in its sole discretion, would be expected to result in a violation
or contravention of Applicable Law or any actual liability to the CBG Group
under Applicable Law,

(each, a “Violation”) in each case, as a result of the Trademark and Technology
License, CBG will have the right to direct and cause the Company to terminate
the Trademark and Technology License by delivering written notice to the
Company. In the event CBG exercises such right, the Company will use its
commercially reasonably efforts to cure the Violation, including by

 

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negotiating and effecting amendments to the Trademark and Technology License.
CBG agrees that it will take all commercially reasonable efforts to assist the
Company following reasonable request by the Company to address such Violation.
If the Violation has not been cured to the satisfaction of CBG within 30 days
from the delivery by CBG of its written notice to the Company in accordance with
this Section 2.5, the Company shall promptly and, in any event, within two
Business Days thereafter, terminate the Trademark and Technology License and
provide CBG with evidence of the actions taken to effect, and the effectiveness
of, the termination of the Trademark and Technology License. Notwithstanding the
foregoing, if at any time within the 30 day cure period, CBG has determined in
its sole discretion that (i) the Violation is not reasonably capable of being
cured within such 30 day period, or (ii) failure to immediately terminate the
Trademark and Technology License would have an adverse effect on the CBG Group
or result in an actual and immediate violation of Applicable Law, the Company
shall immediately terminate the Trademark and Technology License and provide CBG
with evidence of such termination. For purposes of this Section 2.5, any
reference to Applicable Law shall include, for certainty, any Laws applicable to
the United States and the rules of the NYSE so long as the rules of the NYSE
remain applicable to the CBG Group.

 

2.6

Voting Support Agreements

The Company covenants and agrees that within three Business Days following the
date of this Agreement, the Company shall deliver voting support agreements in
favour of CBG in the form attached hereto as Exhibit C executed and delivered by
each executive officer and director of the Company (other than CBG’s designated
directors).

ARTICLE 3

REPRESENTATION AND WARRANTIES

 

3.1

Representations and Warranties of the Company

The Company represents and warrants to CBG each of the matters contained in
Schedule B to this Agreement as of the date hereof and as of the Effective Date,
and acknowledges that CBG is relying on such representations and warranties in
connection with entering into this Agreement and the transactions contemplated
herein.

 

3.2

Representations and Warranties of CBG

CBG represents and warrants to the Company each of the matters contained in
Schedule A to this Agreement as of the date hereof and as of the Effective Date,
and acknowledges that the Company is relying on such representations and
warranties in connection with entering into this Agreement and the transactions
contemplated herein.

ARTICLE 4

CONDITIONS PRECEDENT

 

4.1

Company’s Conditions Precedent for the Closing

The Company’s obligation to complete the transactions contemplated by this
Agreement on the Effective Date shall be subject to the satisfaction or waiver
(at the Company’s sole discretion), as applicable, of the following conditions:

 

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  (a)

all of the representations and warranties of CBG made in or pursuant to this
Agreement shall be true and correct in all respects as of the Effective Date and
with the same effect as if made at and as of the Effective Date and the Company
shall have received a certificate from a senior officer of each of CBG and (on
their behalf and without personal liability), in form and substance satisfactory
to the Company, acting reasonably, confirming same;

 

  (b)

Shareholder Approval shall have been obtained;

 

  (c)

all Regulatory Approvals shall have been obtained; and

 

  (d)

there shall be no Applicable Law or issued or pending Order, injunction,
proceeding, judgment or ruling filed or imposed by any Governmental Authority
for the purpose of enjoining, restricting or preventing the consummation of the
transactions contemplated in this Agreement.

If any of the foregoing conditions in this Section 4.1 have not been satisfied
by the Outside Date, the Company may elect not to complete the transactions
contemplated by this Agreement by notice in writing to CBG, provided that, for
certainty, if the Company does so elect, the consent of CBG under this Agreement
shall be null and void. For greater certainty, if any of the foregoing
conditions has not been satisfied or waived, the Company will not be permitted
to, and will not, complete Project Frontrunner.

 

4.2

CBG Conditions Precedent for Closing

The consent provided by CBG in Article 2 and the completion of the transactions
contemplated by this Agreement on the Effective Date shall be subject to the
satisfaction or waiver (at CBG’s sole discretion), as applicable, of the
following conditions:

 

  (a)

all of the representations and warranties of the Company made in or pursuant to
this Agreement shall be true and correct in all respects as of the Effective
Date and with the same effect as if made at and as of the Effective Date and CBG
shall have received a certificate from a senior officer of the Company (on the
Company’s behalf and without personal liability), in form and substance
satisfactory to CBG, acting reasonably, confirming same;

 

  (b)

the Company shall have performed or complied with, in all respects, all of its
obligations, covenants and agreements under this Agreement required to be
performed or complied with prior to the Closing and CBG shall have received a
certificate from a senior officer of the Company (on the Company’s behalf and
without personal liability), in form and substance satisfactory to CBG, acting
reasonably, confirming same;

 

  (c)

Shareholder Approval shall have been obtained;

 

  (d)

all Regulatory Approvals shall have been obtained;

 

  (e)

there shall be no Applicable Law or issued or pending Order, injunction,
proceeding, judgment or ruling filed or imposed by any Governmental Authority
for the purpose of enjoining, restricting or preventing the consummation of the
transactions contemplated in this Agreement;

 

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  (f)

the Common Shares shall continue to be listed for trading on the TSX and the
NYSE as at the Effective Date;

 

  (g)

the Company shall have executed and delivered each of the Amended Warrants.

If any of the foregoing conditions in this Section 4.2 have not been satisfied
or waived, or if this Agreement has been terminated in accordance with
Section 6.1, the conditional consent granted by CBG in Article 2 shall be deemed
to be null and void and of no force or effect, and the Company shall not have,
and be deemed to not have obtained, CBG’s consent to consummate Project
Frontrunner.

ARTICLE 5

COVENANTS

 

5.1

Actions to Satisfy Closing Conditions

Each of the Parties shall take commercially reasonable efforts to ensure
satisfaction of each of the conditions set forth in Article 4.

 

5.2

Consents, Approvals and Authorizations

 

  (a)

The Company covenants that it shall prepare, file and diligently pursue until
received all necessary consents, approvals and authorizations of any Person and
make such necessary filings, as are required to be obtained under Applicable Law
with respect to this Agreement and the transactions contemplated hereby
(excluding, for greater certainty, the preparation or filing of a prospectus,
offering memorandum, registration statement or similar document in any
jurisdiction).

 

  (b)

The Company shall keep CBG fully informed regarding the status of such consents,
approvals and authorizations, and CBG, its representatives and counsel shall
have the right to participate in any substantive discussions with the TSX, the
NYSE and any other applicable regulatory authority in connection with the
transactions contemplated by this Agreement and provide input into any
applications for approval and related correspondence, which will be incorporated
by the Company, acting reasonably. The Company will provide notice to CBG (and
its counsel) of any proposed substantive discussions with the TSX and the NYSE
in connection with the transactions contemplated by this Agreement. On the date
all such consents, approvals and authorizations have been obtained by the
Company and all such filings have been made by the Company, the Company shall
notify CBG of same.

 

  (c)

Without limiting the generality of the foregoing, the Company shall promptly
make all filings required by the TSX and the NYSE to obtain applicable
Regulatory Approvals. If the approval of the TSX is “conditional approval”
subject to the making of customary deliveries to the TSX after an applicable
Effective Date, the Company shall ensure that such filings are made as promptly
as practicable after such closing date and in any event within the time frame
contemplated in the conditional approval letter from the TSX.

 

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  (d)

The Company shall, promptly after the date hereof, seek, and continue to use
commercially reasonable efforts to seek until obtained, the consent of each
Person which is required in connection with the transactions contemplated
hereby, but excluding, for greater certainty, the preparation or filing of a
prospectus, offering memorandum, registration statement or similar document in
any jurisdiction.

 

  (e)

The Company shall, promptly after the date hereof, seek, and continue to use
commercially reasonable efforts to seek until obtained, the, waiver of any
rights of a third party that could be reasonably expected to be exercisable or
triggered by operation of any “change of control” or similar provision under any
Contract in connection with or as a result of the transactions contemplated
herein.

 

5.3

Company Approval

The Company represents and warrants to CBG, acknowledging that CBG is relying
upon such representations and warranties in entering into this Agreement, that
the Board has received the Fairness Opinion and, after consultation with its
financial advisor and legal counsel, has unanimously determined that (i) the
transactions contemplated by this Agreement are in the best interests of the
Company and fair to the Company Shareholders (other than CBG and its affiliates)
and (ii) the Company will recommend that Company Shareholders vote in favour of
the Approval Resolution.

 

5.4

Company Circular

 

  (a)

The Company shall in accordance with the terms of the Arrangement Agreement: (i)
prepare the Company Circular together with any and all other documents required
by, and in compliance in all material respects with, all applicable Laws on the
date of the mailing thereof; (ii) file the Company Circular with all Canadian
Securities Regulators in all jurisdictions where the same is required to be
filed and with the TSX; and (iii) send the Company Circular to the Company
Shareholders as required under all applicable Laws.

 

  (b)

On the date of mailing thereof, the Company shall ensure that the Company
Circular shall be complete and correct in all material respects, shall not
contain any Misrepresentation and shall contain sufficient detail to permit the
Company Shareholders to form a reasoned judgment concerning the matters to be
placed before them at the Company Meeting (except that the Company shall not be
responsible for any information relating to CBG and its Affiliates that was
provided by CBG expressly for inclusion in the Company Circular nor any
information relating to Frontrunner and its Affiliates that was provided by
Frontrunner expressly for inclusion in the Company Circular).

 

  (c)

The Company Circular shall (i) include a written copy of the Fairness Opinion
(and the Company shall provide an advance copy thereof to CBG for its review and
consideration); and (ii) state that the Board (other than directors, if any, who
abstained from voting on the transactions contemplated by this Agreement) has

 

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  received the Fairness Opinion and unanimously determined, after receiving
legal and financial advice, that the transactions contemplated by this Agreement
are in the best interests of the Company and fair to the Company Shareholders
(other than CBG and its affiliates) and recommend that the Company Shareholders
vote in favour of the Approval Resolution (the “Company Board Recommendation”);
and (iii) include statements that each of the Company Shareholders signing
voting support agreements have agreed to vote their Common Shares in favour of
the Approval Resolution.

 

  (d)

CBG shall provide to the Company all information regarding CBG and its
Affiliates as reasonably requested by the Company or as required by applicable
Laws for inclusion in the Company Circular. CBG shall ensure that any such
information will not include any Misrepresentation including concerning CBG and
its Affiliates.

 

  (e)

CBG and its legal counsel shall be given a reasonable opportunity to review and
comment on the Company Circular and other related documents prior to the Company
Circular and other related documents being printed and filed with the
Governmental Authorities, and reasonable consideration shall be given to any
comments made by CBG and its legal counsel; provided that all information
relating solely to CBG, the Parent and their affiliates included in the Company
Circular shall be in form and substance satisfactory to CBG, acting reasonably.
The Company shall provide CBG with final copies of the Company Circular prior to
its mailing to the Company Shareholders.

 

  (f)

CBG and the Company shall each promptly notify each other if at any time before
the Effective Date either becomes aware that the Company Circular contains a
Misrepresentation, or that the Company Circular otherwise requires an amendment
or supplement and the Parties shall co-operate in the preparation of any
amendment or supplement to the Company Circular as required or appropriate, and
the Company shall promptly mail or otherwise publicly disseminate any amendment
or supplement to the Company Circular to the Company Shareholders and, if
required by the Court or applicable Laws, file the same with the Governmental
Authorities and as otherwise required.

 

  (g)

The Company Circular shall disclose to the Company Shareholders as follows:

 

  (i)

if Project Frontrunner is approved by the shareholders of Frontrunner and the
Court in accordance with the terms of the Arrangement Agreement, but the
Approval Resolution is not approved by the Company Shareholders, then the
Company will not complete Project Frontrunner and the Arrangement Agreement will
be terminated; and

 

  (ii)

if Project Frontrunner is not approved by the shareholders of Frontrunner and
the Court in accordance with the terms of the Arrangement Agreement, the Company
will not issue the Amended Warrants.

 

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5.5

Company Meeting

 

  (a)

The Company agrees to convene and conduct the Company Meeting in accordance with
the Company’s articles and by-laws and applicable Law in accordance with the
terms of the Arrangement Agreement.

 

  (b)

Unless otherwise agreed to in writing by CBG or this Agreement is terminated in
accordance with its terms or except as required by applicable Law or by a
Governmental Authority, the Company shall take all steps reasonably necessary to
hold the Company Meeting and to cause the Approval Resolution to be voted on and
approved at such meeting.

 

  (c)

The Company shall solicit proxies of the Company Shareholders in favour of the
transactions contemplated by this Agreement and all matters to be approved by
the Company Shareholders as set out in the Approval Resolution, and take all
other actions reasonably requested by CBG to obtain the approval of the Approval
Resolution by the Company Shareholders, if so requested, including using the
services of investment dealers and proxy solicitation agents, and cooperating
with any Persons engaged by CBG, to solicit proxies in favour of the approval of
the Approval Resolution, and take all other actions reasonably requested by CBG
to obtain the Shareholder Approval and such other matters as may be necessary to
be approved in connection with the transactions contemplated by this Agreement.

 

  (d)

The Company shall give notice to CBG of the Company Meeting and allow CBG’s
representatives and legal counsel to attend the Company Meeting.

 

  (e)

The Company shall advise CBG as reasonably requested, and on a daily basis on
each of the last seven Business Days prior to the Company Meeting, as to the
aggregate tally of the proxies and votes received in respect of such meeting and
all matters to be considered at such meeting.

 

  (f)

The Company shall advise CBG of any written communication from any Company
Shareholder in opposition to the transactions contemplated by this Agreement.

 

  (g)

The Company shall not change the record date for the Company Shareholders
entitled to vote at the Company Meeting, including in connection with any
adjournment or postponement of the Company Meeting, unless required by Law or
with the prior written consent of CBG.

 

  (h)

The Company shall not waive the deadline for the submission of proxies by
Company Shareholders for the Company Meeting without the prior written consent
of CBG.

 

  (i)

In the event any of CBG or its Affiliates is legally entitled to vote as a
Company Shareholder in respect of the Approval Resolution, and provided that the
Company is not then in breach of this Agreement, CBG shall vote and shall cause
its Affiliates to vote all Common Shares held by them in favour of the Approval
Resolution.

 

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5.6

Interim Period Covenants

The Company hereby covenants and agrees as follows:

 

  (a)

the Company shall not complete Project Frontrunner unless and until the
transactions contemplated by this Agreement are completed on the terms and
conditions of this Agreement;

 

  (b)

neither the Company nor the Company Board will fail to unanimously recommend or
withdraw, amend, modify or qualifies, or publicly propose or state an intention
to withdraw, amend, modify or qualify, the Company Board Recommendation.

 

5.7

CBG Acquisitions

Notwithstanding Section 5.2(a) of the Second Amended and Restated Investor
Rights Agreement, CBG agrees that it will not acquire additional Common Shares
(a) on the TSX, the NYSE or any other stock exchange, marketplace or trading
market on which the Common Shares are then listed; or (b) through private
agreement transactions with existing holders of Common Shares, unless and until
the Effective Date has occurred or all of the Warrants have been exercised by
CBG. Notwithstanding any other provision of this Agreement, this Section 5.7,
shall indefinitely survive any termination of this Agreement.

ARTICLE 6

TERMINATION

 

6.1

Termination

This Agreement shall terminate upon the earliest of:

 

  (a)

the date on which this Agreement is terminated by the mutual consent of the
Parties;

 

  (b)

written notice by the Company to CBG in the event the Closing has not occurred
on or prior to the Outside Date;

 

  (c)

written notice by either Party to the other if the Company Meeting is duly
convened and held and the Shareholder Approval shall not have been obtained;
provided that the Company may not terminate this Agreement pursuant to this
Section 6.1(b) if the failure to obtain the Shareholder Approval has been caused
by, or is a result of, a breach by the Company of any of its representations or
warranties or the failure of the Company to perform any of its covenants or
agreements under this Agreement; or

 

  (d)

written notice by either Party to the other if the Effective Date shall not have
occurred on or prior to December 31, 2019; provided that either Party will have
the right to request the other Party’s consent to an extension beyond
December 31, 2019 on no more than two occasions by a period of up to six months
per occasion, such consent not to be unreasonably withheld as long the Company
and Frontrunner are continuing to diligently cause the occurrence of the
Effective

 

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  Date, including the continuing performance of their covenants under the
Arrangement Agreement; provided, further, that, if the Effective Date shall not
have occurred, in no event shall this Agreement be extended beyond December 31,
2020 on which date, if the Effective Date shall not have occurred, this
Agreement shall automatically terminate.

ARTICLE 7

GENERAL PROVISIONS

 

7.1

Governing Law

This Agreement shall be governed by and construed and interpreted in accordance
with the Laws of the Province of Ontario and the federal Laws of Canada
applicable therein irrespective of the choice of Laws principles.

 

7.2

Notices

All notices, requests, claims, demands and other communications under this
Agreement shall be in writing and shall be given or made (and shall be deemed to
have been duly given or made upon receipt) by delivery in person, by overnight
courier service or by registered or certified mail (postage prepaid, return
receipt requested) to the respective Parties at the following addresses (or at
such other address for a Party as shall be specified in a notice given in
accordance with this Section 7.2):

if to the Company:

1 Hershey Drive,

Smiths Falls, Ontario K7A 0A8

Attention: Chief Executive Officer

with a copy (which shall not constitute notice) to:

Cassels Brock & Blackwell LLP

40 King Street West, Suite 2100

Toronto, Ontario M5H 3C2

Attention: Jonathan Sherman

if to CBG:

c/o Constellation Brands, Inc.

207 High Point Drive, Bldg. 100

Victor, New York 14564

Attention: General Counsel

 

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--------------------------------------------------------------------------------

and with a copy (which shall not constitute notice) to:

Osler, Hoskin & Harcourt LLP

100 King Street West, Suite 6200

Toronto, Ontario M5X 1B8

Attention: Emmanuel Pressman and James R. Brown

 

7.3

Expenses

Except as otherwise specifically provided in this Agreement: (a) each Party
shall bear any costs and expenses incurred in connection with exercising its
rights and performing its obligations under this Agreement; and (b) CBG and the
Company shall be jointly responsible for any filing fees payable for or in
respect of any application, notification or other filing made in respect of any
Regulatory Approval process in respect of the transactions contemplated by the
transactions contemplated by this Agreement.

 

7.4

Severability

If any term or other provision of this Agreement is invalid, illegal or
incapable of being enforced under any Applicable Law or as a matter of public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the Parties shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the Parties as closely as possible in a mutually acceptable manner in
order that the transactions contemplated by this Agreement be consummated as
originally contemplated to the greatest extent possible.

 

7.5

Entire Agreement

This Agreement (including the Schedules and Exhibits hereto), together with the
Second Amended and Restated Investor Rights Agreement and the Amended Warrants,
constitute the entire agreement of the Parties with respect to the subject
matter of this Agreement and supersede all prior agreements and undertakings,
both written and oral, between or on behalf of the Parties with respect to the
subject matter of this Agreement.

 

7.6

Assignment; No Third-Party Beneficiaries

 

  (a)

This Agreement shall not be assigned by any Party hereto without the prior
written consent of the other Party.

 

  (b)

This Agreement is for the sole benefit of the Parties and their permitted
successors and assigns and nothing in this Agreement, express or implied, is
intended to or shall confer upon any other Person any legal or equitable right,
benefit or remedy of any nature whatsoever under or by reason of this Agreement.

 

7.7

Amendment; Waiver

No provision of this Agreement may be amended or modified except by a written
instrument signed by both Parties. No waiver by any Party of any provision
hereof shall be effective unless explicitly set forth in writing and executed by
the Party so waiving. The waiver by either Party hereto of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
other subsequent breach.

 

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7.8

Injunctive Relief

The Parties agree that irreparable harm would occur for which money damages
would not be an adequate remedy at Law in the event that any of the provisions
of this Agreement were not performed in accordance with their specific terms or
were otherwise breached. Accordingly, the Parties agree that, in the event of
any breach or threatened breach of this Agreement by a Party, the non-breaching
Party will be entitled, without the requirement of posting a bond or other
security, to equitable relief, including injunctive relief and specific
performance, and the Parties shall not object to the granting of injunctive or
other equitable relief on the basis that there exists an adequate remedy at Law.
Such remedies will not be the exclusive remedies for any breach of this
Agreement but will be in addition to all other remedies available at Law or
equity to each of the Parties.

 

7.9

Rules of Construction

Interpretation of this Agreement shall be governed by the following rules of
construction: (a) words in the singular shall be held to include the plural and
vice versa, and words of one gender shall be held to include the other gender as
the context requires; (b) references to the terms Article, Section, paragraph,
and Schedule are references to the Articles, Sections, paragraphs, and Schedules
to this Agreement unless otherwise specified; (c) the word “including” and words
of similar import shall mean “including, without limitation,”; (d) provisions
shall apply, when appropriate, to successive events and transactions; (e) the
headings contained herein are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement; (f) a reference to a
statute includes all regulations and rules made pursuant to the statute and,
unless otherwise specified, the provisions of any statute, regulation or rule
which amends, supplements or supersedes any such statute, regulation or rule;
and (g) this Agreement shall be construed without regard to any presumption or
rule requiring construction or interpretation against the party drafting or
causing any instrument to be drafted.

 

7.10

Currency

All references in this Agreement to “dollars” or “$” are expressed in Canadian
currency, unless otherwise specifically indicated.

 

7.11

Further Assurances

Each of the Parties shall promptly do, make, execute, deliver, or cause to be
done, made, executed or delivered, all such further acts, documents and things
as the other Parties may reasonably require from time to time for the purpose of
giving effect to the Transaction Agreements and shall use reasonable efforts and
take all such steps as may be reasonably within its power to implement to their
full extent the provisions of the Transaction Agreements.

 

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7.12

Public Notices/Press Releases

CBG and the Company shall each publicly announce the transactions contemplated
hereby promptly following the execution of this Agreement by CBG and the
Company, and the content, text and timing of each Party’s announcement shall be
approved by the other Party in advance, acting reasonably. CBG and the Company
agree to co-operate in the preparation of presentations, if any, to CBG’s
shareholders or the Company’s shareholders regarding the transactions
contemplated by this Agreement. No Party shall issue any press release or
otherwise make public announcements with respect to this Agreement without the
consent of the other Party (which consent shall not be unreasonably withheld or
delayed); provided that, except as required by Applicable Law, in no
circumstance shall any such disclosure by, or regulatory filing of, the Company
or any of its Affiliates include the name of any member of CBG Group without
CBG’s prior written consent, in its sole discretion.

 

7.13

Public Disclosure

During the period from the date hereof to the Closing, except as may be required
by Applicable Law or with the prior written consent of CBG, the Company shall
not make any public disclosures or public announcements, or undertake or give
effect to any corporate actions, in each case that could reasonably be expected
to hinder, delay or materially interfere with the consummation of the
transactions contemplated under this Agreement.

 

7.14

Counterparts

This Agreement may be executed in one or more counterparts, each of which when
executed shall be deemed to be an original but all of which taken together shall
constitute one and the same agreement. Delivery of an executed counterpart of a
signature page to this Agreement by facsimile or electronic transmission shall
be as effective as delivery of a manually executed counterpart of this
Agreement.

[Signature page follows]

 

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed on the
date first written above.

 

CBG HOLDINGS LLC By:   /s/ Garth Hankinson   Name: Garth Hankinson   Title:
  President CANOPY GROWTH CORPORATION By:   /s/ Bruce Linton   Name: Bruce
Linton   Title:   Chairman and Co-Chief Executive Officer

Consent Agreement

--------------------------------------------------------------------------------

SCHEDULE A

REPRESENTATIONS AND WARRANTIES OF CBG

CBG represents and warrants to and in favour of the Company and acknowledges
that the Company is relying on such representations and warranties in connection
with this Agreement and the transactions contemplated therein:

 

  (a)

this Agreement has been duly authorized, executed and delivered by CBG and
constitutes a legal, valid and binding obligation of CBG enforceable against CBG
in accordance with its terms, subject to bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or similar Laws affecting creditors’
rights generally, and will not violate or conflict with the constating documents
of CBG or the terms of any restriction, agreement or undertaking to which CBG is
subject;

 

  (b)

CBG is a valid and subsisting limited liability company existing under the Laws
of its jurisdiction of organization and no steps or proceedings have been taken
by any Person, voluntary or otherwise, requiring or authorizing the dissolution
or winding up of CBG;

 

  (c)

CBG has the necessary corporate power and authority to execute and deliver the
Transaction Agreements to which it is a party and to observe and perform its
covenants and obligations hereunder and thereunder and has taken all necessary
action in respect thereof;

 

  (d)

all information about the CBG Group provided by CBG to the Company for inclusion
in the Company Circular will be true and accurate and will not include any
Misrepresentation including concerning the CBG Group.

 

Schedule A-1

--------------------------------------------------------------------------------

SCHEDULE B

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

The Company represents and warrants to and in favour of CBG and acknowledges
that CBG is relying on such representations and warranties in connection with
this Agreement and the transactions contemplated therein:

 

  (a)

this Agreement has been duly authorized, executed and delivered by the Company
and constitutes a legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or similar Laws
affecting creditors’ rights generally, and will not violate or conflict with the
constating documents of the Company or the terms of any restriction, agreement
or undertaking to which the Company is subject;

 

  (b)

the Company has been duly incorporated and is validly existing as a corporation
under the Laws of the jurisdiction in which it was incorporated and no steps or
proceedings have been taken by any Person, voluntary or otherwise, requiring or
authorizing the dissolution or winding up of the Company;

 

  (c)

the Company has the necessary corporate power and authority to execute and
deliver the Transaction Agreements and to observe and perform its covenants and
obligations hereunder and thereunder and has taken all necessary action in
respect thereof;

 

  (d)

the Amended Warrants described in this Agreement have been duly authorized and
created and the Underlying Shares to be issued have been duly authorized and
reserved for issuance and, when issued, delivered and paid for in full, will be
validly issued and fully paid shares in the capital of the Company;

 

  (e)

subject to the receipt of the Regulatory Approvals, each of the execution and
delivery of this Agreement, the performance by the Company of its obligations
hereunder, the amendments to the Warrants and the consummation of the
transactions contemplated in this Agreement and the other Transaction
Agreements: (i) does not and will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default under
(whether after notice or lapse of time or both), (A) any Law applicable to the
Company; (B) the articles, by-laws or resolutions of the directors or
shareholders of the Company; (C) any Contract to which the Company is a party or
by which the Company is bound except where such conflict, breach, violation or
default would not result in a Material Adverse Effect; or (D) any judgment,
decree or Order binding the Company or the property or assets thereof; and
(ii) does not affect the rights, duties and obligations of any parties to a
Contract, nor give a party the right to terminate the Contract, by virtue of the
application of terms, provisions or conditions in the Contract, except where
those rights, duties or obligations, or rights to terminate, are affected in a
manner that would not result in a Material Adverse Effect; and

 

Schedule B-1

--------------------------------------------------------------------------------

  (f)

no consent, approval, authorization, Order, filing, registration or
qualification of or with any court, Governmental Authority or any other Person
is required for the execution, delivery and performance by the Company of the
Transaction Agreements or for the consummation of the transactions contemplated
by the Transaction Agreements, except (i) such as have been obtained;
(ii) Regulatory Approval, which will be obtained by the Effective Date; and
(iii) any conditions precedent required to be satisfied under the Arrangement
Agreement in connection with Project Frontrunner.

 

Schedule B-2

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EXHIBIT A

FORMS OF AMENDED WARRANT CERTIFICATE

Form of Tranche A Amended Warrant Certificate

(see attached)

--------------------------------------------------------------------------------

TRANCHE A

AMENDED AND RESTATED

COMMON SHARE PURCHASE WARRANT

THE SECURITIES REPRESENTED HEREBY AND THE SECURITIES ISSUABLE UPON EXERCISE
HEREOF HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR U.S. STATE
SECURITIES LAWS. THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE
HEREOF MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED, DIRECTLY OR
INDIRECTLY, ONLY (A) TO CANOPY GROWTH CORPORATION (THE “CORPORATION”), (B)
OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE
U.S. SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE LOCAL LAWS AND
REGULATIONS, (C) IN COMPLIANCE WITH THE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS UNDER THE U.S. SECURITIES ACT PROVIDED BY (I) RULE 144 THEREUNDER
IF AVAILABLE OR (II) RULE 144A THEREUNDER, IF AVAILABLE, AND IN EACH CASE IN
ACCORDANCE WITH APPLICABLE U.S. STATE SECURITIES LAWS, (D) IN ANOTHER
TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE U.S. SECURITIES ACT OR
ANY APPLICABLE STATE SECURITIES LAWS, OR (E) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE U.S. SECURITIES ACT, PROVIDED THAT, IN THE CASE
OF TRANSFERS PURSUANT TO (C)(I) OR (D) ABOVE, THE HOLDER HAS, PRIOR TO SUCH
TRANSFER, FURNISHED TO THE CORPORATION AN OPINION OF COUNSEL OR OTHER EVIDENCE
OF EXEMPTION, IN EITHER CASE REASONABLY SATISFACTORY TO THE CORPORATION.
DELIVERY OF THIS CERTIFICATE MAY NOT CONSTITUTE “GOOD DELIVERY” IN SETTLEMENT OF
TRANSACTIONS ON STOCK EXCHANGES IN CANADA.”

THIS WARRANT MAY NOT BE EXERCISED IN THE UNITED STATES OR BY OR ON BEHALF OF A
U.S. PERSON OR PERSON IN THE UNITED STATES UNLESS THIS WARRANT AND SHARES
ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT AND THE APPLICABLE SECURITIES LEGISLATION OF ANY SUCH STATE OR
EXEMPTIONS FROM SUCH REGISTRATION REQUIREMENTS ARE AVAILABLE. “UNITED STATES”
AND “U.S. PERSON” ARE AS DEFINED BY REGULATION S UNDER THE U.S. SECURITIES ACT.

WARRANTS TO PURCHASE COMMON SHARES OF

CANOPY GROWTH CORPORATION

 

Warrant Certificate Number:

     Number of Warrants:

2018 – A-1

     88,472,861      Date:      ●, 2019

Effective as of the date hereof, this Warrant Certificate amends, re-evidences,
restates, replaces and supersedes 88,472,861 common share purchase warrants
issued by the Company to the Holder (as each such term is defined below)
pursuant to the tranche A common share purchase warrant dated November 1, 2018
(the “Original Warrant Certificate”).

--------------------------------------------------------------------------------

THIS CERTIFIES THAT, for value received, CBG Holdings LLC (the “Holder”) is
entitled, at any time prior to the Expiry Time, to purchase, at the Exercise
Price, one fully paid, validly issued and non-assessable Common Share for each
Warrant vested and exercisable under this Warrant Certificate, by surrendering
to the Company, at its principal office at 1 Hershey Drive, Smith Falls,
Ontario, K7A 0A8, this Warrant Certificate, together with a Subscription Form,
duly completed and executed, and immediately available funds by wire transfer of
lawful money of Canada payable to or to the order of the Company for an amount
equal to the Exercise Price multiplied by the number of Common Shares subscribed
for, on and subject to the terms and conditions set forth below.

Nothing contained herein shall confer any right upon the Holder to subscribe for
or purchase any Common Shares at any time after the Expiry Time, and from and
after the Expiry Time, this Warrant Certificate and all rights hereunder shall
be void and of no value.

 

1.

Defined Terms

Capitalized terms used in this Warrant Certificate, including the preamble,
shall have the following meanings:

“Adjustment Period” means the period commencing on the date hereof and ending at
the Expiry Time.

“Affiliate” means, with respect to any Person, any Person now or hereafter
existing, directly or indirectly, Controlled by, Controlling, or under common
Control with, such Person, whether on or after the date hereof.

“Business Day” means a day other than a Saturday, Sunday or other day on which
commercial banks in Smiths Falls, Ontario are authorized or required by law to
close. Any event the scheduled occurrence of which would fall on a day that is
not a Business Day shall be deferred until the next succeeding Business Day.

“Capital Reorganization” has the meaning ascribed to such term in
Section 8(a)(iv).

“Common Share” means a common share in the capital of the Company or such other
shares or other securities into which such common share is converted, exchanged,
reclassified or otherwise changed, as the case may be, from time to time.

“Company” means Canopy Growth Corporation, a corporation existing under the
federal laws of Canada, and its successors and assigns.

“Control” means:

 

  (a)

in relation to a corporation, the direct or indirect beneficial ownership at the
relevant time of shares of such corporation carrying more than 50% of the voting
rights ordinarily exercisable at meetings of shareholders of the Company where
such voting rights are sufficient to elect a majority of the directors of the
Company;

 

  (b)

in relation to a Person that is a partnership, limited liability company or
joint venture, the direct or indirect beneficial ownership at the relevant time
of more than 50% of the ownership interests of the partnership, limited
liability company or joint venture in circumstances where it can reasonably be
expected that the Person can direct the affairs of the partnership, limited
liability company or joint venture; and

 

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  (c)

in relation to a trust, the direct or indirect beneficial ownership at the
relevant time of more than 50% of the property settled under the trust;

and the words “ Controlled by”, “Controlling” and similar words have
corresponding meanings; the Person who directly or indirectly Controls a
Controlled Person or entity shall be deemed to Control a corporation,
partnership, limited liability company, joint venture or trust which is
Controlled by the Controlled Person or entity, and so on.

“Current Market Price” means, at the relevant time of reference, the price per
share equal to the volume-weighted average trading price of the Common Shares on
the TSX for the five Trading Days immediately preceding the relevant record
date.

“Exercise Price” means $50.40.

“Expiry Time” means 5:00 p.m. (Toronto time) on November 1, 2023.

“NYSE” means the New York Stock Exchange.

“Person” means an individual, corporation, partnership, unincorporated
syndicate, unincorporated organization, trust, trustee, executor, administrator,
or other legal representative, or any group or combination thereof.

“Rights Offering” has the meaning ascribed to such term in Section 8(a)(ii).

“Rights Period” has the meaning ascribed to such term in Section 8(a)(ii).

“Special Distribution” has the meaning ascribed to such term in
Section 8(a)(iii).

“Subscription Form” means the form of subscription annexed hereto as Schedule
“A”.

“Trading Day” means a day on which the TSX is open for business.

“TSX” means the Toronto Stock Exchange.

“United States” means the United States of America, its territories and
possessions, any state of the United States and the District of Columbia.

“U.S. Person” means “U.S. person” as defined in Rule 902(k) of Regulation S
under the U.S. Securities Act.

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

“Warrants” means the tranche A Common Share purchase warrants represented by
this Warrant Certificate.

 

2.

Vesting of Warrants

The Warrants represented by this Warrant Certificate are fully vested and are
immediately exercisable by the Holder at any time and from time to time,
commencing on the date hereof and prior to the Expiry Time.

 

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3.

Exercise of Warrants

 

  (a)

Subject to Section 2, the rights represented by this Warrant Certificate may be
exercised by the Holder, in whole or in part, by the surrender of this Warrant
Certificate, with the attached Subscription Form duly executed, at the principal
office of the Company at 1 Hershey Drive, Smiths Falls, Ontario K7A 0A8 (or such
other office of the Company as it may designate by notice in writing to the
Holder at the address of such Holder appearing on the books of the Company at
any time and from time to time during the period within which the rights
represented by this Warrant Certificate may be exercised) and upon payment to or
to the order of the Company of immediately available funds by wire transfer of
lawful money of Canada in an amount equal to the Exercise Price per Common Share
multiplied by the aggregate number of Common Shares to be issued on such
exercise of this Warrant. In the event that the Holder subscribes for and
purchases any such lesser number of Common Shares prior to the Expiry Time, the
Holder shall be entitled to receive a replacement Warrant Certificate, without
charge, representing the unexercised balance of the Warrants as soon as
practicable, and in any event within five Business Days, after the Warrants
represented by this Warrant Certificate shall have been so exercised.

 

  (b)

The Company agrees that the Common Shares so purchased shall be and be deemed to
be issued to the Holder as the registered owner of such Common Shares as of the
close of business on the date on which both this Warrant Certificate shall have
been surrendered and payment made for such Common Shares as aforesaid.
Certificates for the Common Shares so purchased shall be delivered to the Holder
as soon as practicable, and in any event within five Business Days, after the
Warrants represented by this Warrant Certificate shall have been so exercised.

 

4.

Ability to Exercise

Subject to Section 2, the Warrants may be exercised in whole or in part at any
time and from time to time prior to the Expiry Time. After the Expiry Time, all
rights under any outstanding Warrants evidenced hereby, in respect of which the
rights of subscription and purchase herein provided for shall not have been
exercised, shall wholly cease and terminate and such Warrants shall be void and
of no value or effect.

 

5.

No Fractional Common Shares

No fractional Common Shares will be issuable upon any exercise of the Warrants
and the Holder will not be entitled to any cash payment or compensation in lieu
of a fractional Common Share.

 

6.

Not a Shareholder

The holding of the Warrants shall not constitute the Holder a shareholder of the
Company nor entitle the Holder to any right or interest in respect thereof,
except as expressly provided in this Warrant Certificate.

 

7.

Covenants and Representations of the Company The Company covenants and agrees as
follows:

 

  (a)

this Warrant Certificate is a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms;

 

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  (b)

all Common Shares which may be issued upon the exercise of the rights
represented by the Warrants will, upon issuance, be validly issued, fully paid
and non-assessable, free from all taxes, liens and charges with respect to the
issue thereof, except with respect to any applicable withholding taxes; and

 

  (c)

during the period within which the rights represented by this Warrant
Certificate may be exercised, the Company will at all times have authorized and
reserved a sufficient number of its Common Shares to provide for the exercise of
the rights represented by this Warrant Certificate.

 

8.

Anti-Dilution Protection

 

  (a)

The Exercise Price and the number of Common Shares issuable to the Holder upon
the exercise of the Warrants shall be subject to adjustment from time to time in
the events and in the manner provided as follows:

 

  (i)

If at any time during the Adjustment Period the Company shall:

 

  (A)

fix a record date for the issue of, or issue, Common Shares to the holders of
all or substantially all of the outstanding Common Shares by way of a share
dividend;

 

  (B)

fix a record date for the distribution to, or make a distribution to, the
holders of all or substantially all of the outstanding Common Shares payable in
Common Shares or securities exchangeable for or convertible into Common Shares;

 

  (C)

subdivide the outstanding Common Shares into a greater number of Common Shares;
or

 

  (D)

consolidate the outstanding Common Shares into a smaller number of Common
Shares,

(any of such events in subsections (A), (B), (C) and (D) above being called a
“Common Share Reorganization”), the Exercise Price shall be adjusted on the
earlier of the record date on which holders of Common Shares are determined for
the purposes of the Common Share Reorganization and the effective date of the
Common Share Reorganization to the amount determined by multiplying the Exercise
Price in effect immediately prior to such record date or effective date, as the
case may be, by a fraction:

 

  (A)

the numerator of which shall be the number of Common Shares outstanding on such
record date or effective date, as the case may be, before giving effect to such
Common Share Reorganization; and

 

  (B)

the denominator of which shall be the number of Common Shares which will be
outstanding immediately after giving effect to such Common Share Reorganization
(including, in the case of a distribution of securities exchangeable for or
convertible into Common Shares, the number of Common Shares that would have been
outstanding had such securities been exchanged for or converted into Common
Shares on such record date or effective date, as the case may be).

 

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To the extent that any adjustment in the Exercise Price occurs pursuant to this
Section 8(a)(i) as a result of the fixing by the Company of a record date for
the distribution of securities exchangeable for or convertible into Common
Shares, the Exercise Price shall be readjusted immediately after the expiry of
any relevant exchange or conversion right to the Exercise Price which would then
be in effect based upon the number of Common Shares actually issued and
remaining issuable after such expiry and shall be further readjusted in such
manner upon the expiry of any further such right.

 

  (ii)

If at any time during the Adjustment Period the Company shall fix a record date
for the issue or distribution to the holders of all or substantially all of the
outstanding Common Shares of rights, options or warrants pursuant to which such
holders are entitled, during a period expiring not more than 45 days after the
record date for such issue (such period being the “Rights Period”), to subscribe
for or purchase Common Shares or securities exchangeable for or convertible into
Common Shares at a price per share to the holder (or in the case of securities
exchangeable for or convertible into Common Shares, at an exchange or conversion
price per share) at the date of issue of such securities of less than the
Current Market Price of the Common Shares on such record date (any of such
events being called a “Rights Offering”), the Exercise Price shall be adjusted
effective immediately after the record date for such Rights Offering to the
amount determined by multiplying the Exercise Price in effect on such record
date by a fraction:

 

  (A)

the numerator of which shall be the aggregate of:

 

  (1)

the number of Common Shares outstanding on the record date for the Rights
Offering, and

 

  (2)

the quotient determined by dividing

 

  I.

either (a) the product of the number of Common Shares offered during the Rights
Period pursuant to the Rights Offering and the price at which such Common Shares
are offered, or (b) the product of the exchange or conversion price of the
securities so offered and the number of Common Shares for or into which the
securities offered pursuant to the Rights Offering may be exchanged or
converted, as the case may be, by

 

  II.

the Current Market Price of the Common Shares as of the record date for the
Rights Offering; and

 

  (B)

the denominator of which shall be the aggregate of the number of Common Shares
outstanding on such record date and the number of Common Shares offered pursuant
to the Rights Offering (including in the case of the issue or distribution of
securities exchangeable for or convertible into Common Shares the number of
Common Shares for or into which such securities may be exchanged or converted).

 

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If by the terms of the rights, options, or warrants referred to in this
Section 8(a)(ii), there is more than one purchase, conversion or exchange price
per Common Share, the aggregate price of the total number of additional Common
Shares offered for subscription or purchase, or the aggregate conversion or
exchange price of the convertible or exchangeable securities so offered, shall
be calculated for purposes of the adjustment on the basis of the lowest
purchase, conversion or exchange price per Common Share, as the case may be. Any
Common Shares owned by or held for the account of the Company shall be deemed
not to be outstanding for the purpose of any such calculation. To the extent
that any adjustment in the Exercise Price occurs pursuant to this
Section 8(a)(ii) as a result of the fixing by the Company of a record date for
the issue or distribution of rights, options or warrants referred to in this
Section 8(a)(ii), the Exercise Price shall be readjusted immediately after the
expiry of any relevant exchange, conversion or exercise right to the Exercise
Price which would then be in effect based upon the number of Common Shares
actually issued and remaining issuable after such expiry and shall be further
readjusted in such manner upon the expiry of any further such right.

 

  (iii)

If at any time during the Adjustment Period the Company shall fix a record date
for the issue or distribution to the holders of all or substantially all of the
outstanding Common Shares of:

 

  (A)

shares of the Company of any class other than Common Shares;

 

  (B)

rights, options or warrants to acquire Common Shares or securities exchangeable
for or convertible into Common Shares (other than rights, options or warrants
pursuant to which holders of Common Shares are entitled, during a period
expiring not more than 45 days after the record date for such issue, to
subscribe for or purchase Common Shares or securities exchangeable for or
convertible into Common Shares at a price per share (or in the case of
securities exchangeable for or convertible into Common Shares at an exchange or
conversion price per share) at the date of issue of such securities to the
holder of at least the Current Market Price of the Common Shares on such record
date);

 

  (C)

evidences of indebtedness of the Company; or

 

  (D)

any property or assets of the Company;

and if such issue or distribution does not constitute a Common Share
Reorganization or a Rights Offering (any of such non-excluded events being
called a “Special Distribution”), the Exercise Price shall be adjusted effective
immediately after the record date for the Special Distribution to the amount
determined by multiplying the Exercise Price in effect on the record date for
the Special Distribution by a fraction:

 

  (1)

the numerator of which shall be the difference between:

 

  I.

the product of the number of Common Shares outstanding on such record date and
the Current Market Price of the Common Shares on such record date, and

 

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  II.

the fair value, as determined in good faith by the directors of the Company, to
the holders of Common Shares of the shares, rights, options, warrants, evidences
of indebtedness or property or assets to be issued or distributed in the Special
Distribution; and

 

  (2)

the denominator of which shall be the product obtained by multiplying the number
of Common Shares outstanding on such record date by the Current Market Price of
the Common Shares on such record date.

Any Common Shares owned by or held for the account of the Company shall be
deemed not to be outstanding for the purpose of such calculation. To the extent
that any adjustment in the Exercise Price occurs pursuant to this
Section 8(a)(iii) as a result of the fixing by the Company of a record date for
the issue or distribution of rights, options or warrants to acquire Common
Shares or securities exchangeable for or convertible into Common Shares referred
to in this Section 8(a)(iii), the Exercise Price shall be readjusted immediately
after the expiry of any relevant exercise, exchange or conversion right to the
amount which would then be in effect based upon the number of Common Shares
issued and remaining issuable after such expiry and shall be further readjusted
in such manner upon the expiry of any further such right.

 

  (iv)

If at any time during the Adjustment Period there shall occur:

 

  (A)

a reclassification or redesignation of the Common Shares, any change of the
Common Shares into other shares or securities or any other capital
reorganization involving the Common Shares other than a Common Share
Reorganization;

 

  (B)

a consolidation, amalgamation, arrangement or merger of the Company with or into
another body corporate which results in a reclassification or redesignation of
the Common Shares or a change of the Common Shares into other shares or
securities;

 

  (C)

the transfer of the undertaking or assets of the Company as an entirety or
substantially as an entirety to another company or entity;

(any of such events being called a “Capital Reorganization”), after the
effective date of the Capital Reorganization the Holder shall be entitled to
receive, and shall accept, for the same aggregate consideration, upon exercise
of the Warrants, in lieu of the number of Common Shares to which the Holder was
theretofore entitled upon the exercise of the Warrants, the kind and aggregate
number of shares and other securities or property resulting from the Capital
Reorganization which the Holder would have been entitled to receive as a result
of the Capital Reorganization if, on the effective date thereof, the Holder had
been the registered holder of the number of Common Shares which the Holder was
theretofore entitled to purchase or receive upon the exercise of the Warrants.
If necessary, as a result of any such Capital Reorganization, appropriate
adjustments shall be made in the application of the provisions of this Warrant
Certificate with respect to the rights and interests thereafter of the Holder to
the end that the provisions shall thereafter correspondingly be made applicable
as nearly as may reasonably be possible in relation to any shares or other
securities or property thereafter deliverable upon the exercise of the Warrants.

 

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  (v)

If at any time during the Adjustment Period any adjustment or readjustment in
the Exercise Price shall occur pursuant to the provisions of Sections 8(a)(i) or
8(a)(iii) of this Warrant Certificate, then the number of Common Shares
purchasable upon the subsequent exercise of the Warrants shall be simultaneously
adjusted or readjusted, as the case may be, by multiplying the number of Common
Shares purchasable upon the exercise of the Warrants immediately prior to such
adjustment or readjustment by a fraction which shall be the reciprocal of the
fraction used in the adjustment or readjustment of the Exercise Price.

 

  (b)

The following rules and procedures shall be applicable to adjustments made
pursuant to Section 8(a) of this Warrant Certificate:

 

  (i)

subject to the following sections of this Section 8(b), any adjustment made
pursuant to Section 8(a) of this Warrant Certificate shall be made successively
whenever an event referred to therein shall occur;

 

  (ii)

no adjustment in the Exercise Price shall be required unless such adjustment
would result in a change of at least one percent in the then Exercise Price and
no adjustment shall be made in the number of Common Shares purchasable or
issuable on the exercise of the Warrants unless it would result in a change of
at least one one-hundredth of a Common Share; provided, however, that any
adjustments which except for the provision of this Section 8(b)(ii) would
otherwise have been required to be made shall be carried forward and taken into
account in any subsequent adjustment. Notwithstanding any other provision of
Section 8(a) of this Warrant Certificate, no adjustment of the Exercise Price
shall be made which would result in an increase in the Exercise Price or a
decrease in the number of Common Shares issuable upon the exercise of the
Warrants (except in respect of a consolidation of the outstanding Common
Shares);

 

  (iii)

if at any time during the Adjustment Period the Company shall take any action
affecting the Common Shares, other than an action or event described in
Section 8(a) of this Warrant Certificate, which in the opinion of the directors
of the Company would have an adverse effect upon the rights of the Holder, the
Exercise Price and/or the number of Common Shares purchasable under the Warrants
shall, subject to any necessary regulatory approval, be adjusted in such manner
and at such time as the directors of the Company may determine to be equitable
in the circumstances, provided that no such action shall be taken unless and
until the Holder has been provided with notice of such proposed action and the
consequences thereof;

 

  (iv)

if the Company sets a record date to determine holders of Common Shares for the
purpose of entitling such holders to receive any dividend or distribution or any
subscription or purchase rights and shall thereafter and before the distribution
to such holders of any such dividend, distribution or subscription or purchase
rights legally abandon its plan to pay or deliver such dividend, distribution or
subscription or purchase rights, then no adjustment in the Exercise Price or the
number of Common Shares purchasable under the Warrants shall be required by
reason of the setting of such record date;

 

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  (v)

no adjustment in the Exercise Price or in the number or kind of securities
purchasable on the exercise of the Warrants shall be made in respect of any
event described in Section 8 of this Warrant Certificate if (subject to TSX and
NYSE approval) the Holder is entitled to participate in such event on the same
terms mutatis mutandis as if the Holder had exercised the Warrants prior to or
on the record date or effective date, as the case may be, of such event. Any
such participation by the Holder is subject to regulatory approval; and

 

  (vi)

in any case in which this Warrant Certificate shall require that an adjustment
shall become effective immediately after a record date for an event referred to
in Section 8(a) hereof, the Company may defer, until the occurrence of such
event:

 

  (A)

issuing to the Holder, to the extent that the Warrants are exercised after such
record date and before the occurrence of such event, the additional Common
Shares issuable upon such exercise by reason of the adjustment required by such
event; and

 

  (B)

delivering to the Holder any distribution declared with respect to such
additional Common Shares after such record date and before such event;

provided, however, that the Company shall deliver to the Holder an appropriate
instrument evidencing the right of the Holder upon the occurrence of the event
requiring the adjustment, to an adjustment in the Exercise Price or the number
of Common Shares purchasable upon the exercise of the Warrants and to such
distribution declared with respect to any such additional Common Shares issuable
on the exercise of the Warrants.

 

  (c)

At least 10 days prior to the earlier of the record date or effective date of
any event which requires or might require an adjustment in any of the rights of
the Holder under this Warrant Certificate, including the Exercise Price or the
number of Common Shares which may be purchased under this Warrant Certificate,
the Company shall deliver to the Holder a certificate of the Company specifying
the particulars of such event and, if determinable, the required adjustment and
the calculation of such adjustment. In case any adjustment for which a notice in
this Section 8(c) has been given is not then determinable, the Company shall
promptly after such adjustment is determinable deliver to the Holder a
certificate providing the calculation of such adjustment. The Company hereby
covenants and agrees that the Company will not take any action which might
deprive the Holder of the opportunity of exercising the rights of subscription
contained in this Warrant Certificate, during such 10 day period.

 

  (d)

In connection with any: (i) reclassification or redesignation of the Common
Shares, any change of the Common Shares into other shares or securities or any
other capital reorganization involving the Common Shares other than as set forth
in this Section 8; (ii) consolidation, amalgamation, arrangement or merger of
the Company with or into another body corporate which results in a
reclassification or redesignation of the Common Shares or a change of the Common
Shares into other shares or securities (including, without limitation, pursuant
to a “take-over bid”, “tender offer” or other acquisition of all or
substantially all of the outstanding Common Shares); or (iii) sale, transfer or
lease to another corporation of all or substantially all the property or assets
of the Company, the Holder shall have the right thereafter, upon payment of the
Exercise Price in effect immediately prior to such action, to purchase upon
exercise of each Warrant the kind and amount of shares and other securities and
property which it would have owned or have been entitled to receive after the
happening of such reclassification,

 

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  redesignation, consolidation, amalgamation, arrangement, merger, sale,
transfer or lease had such Warrant been exercised immediately prior to such
action, and the Holder shall be bound to accept such shares and other securities
and property in lieu of the Common Shares to which it was previously entitled;
provided, however, that no adjustment in respect of dividends, interest or other
income on or from such shares or other securities and property shall be made
during the term of a Warrant or upon the exercise of a Warrant. If necessary, as
a result of any actions contemplated by this paragraph, appropriate adjustments
shall be made in the application of the provisions of this Warrant Certificate
with respect to the rights and interests thereafter of the Holder to the end
that the provisions shall thereafter correspondingly be made applicable as
nearly as may reasonably be possible in relation to any shares or other
securities or property thereafter deliverable upon the exercise of the Warrants.
The provisions of this paragraph shall similarly apply to successive
consolidations, mergers, amalgamation, sales, transfers or leases.

 

9.

U.S. Registration

This Warrant and the Common Shares issuable upon exercise of this Warrant have
not been and will not be registered under the U.S. Securities Act or under state
securities laws of any state in the United States. Accordingly, this Warrant may
not be transferred or exercised in the United States or by or on behalf of a
U.S. Person or a person in the United States unless an exemption is available
from the registration requirements of the U.S. Securities Act and applicable
state securities laws and, if required by the Company, the holder of this
Warrant has furnished an opinion of counsel of recognized standing in form and
substance reasonably satisfactory to the Company to such effect, as applicable.

 

10.

Authorized Shares

As a condition precedent to the taking of any action which would require an
adjustment pursuant to Section 8 of this Warrant Certificate, the Company shall
take any action which may be necessary in order that the Company has issued and
reserved in its authorized capital, and may validly and legally issue as fully
paid and non-assessable, all of the Common Shares (or other shares and
securities, if applicable) which the Holder of the Warrants is entitled to
receive on the exercise hereof.

 

11.

Mutilated or Missing Warrant Certificate

Upon receipt of evidence satisfactory to the Company of the loss, theft,
destruction or mutilation of this Warrant Certificate and, in the case of any
such loss, theft or destruction, upon delivery of a bond or indemnity
satisfactory to the Company, or, in the case of any such mutilation, upon
surrender or cancellation of this Warrant Certificate, the Company will issue to
the Holder a new warrant certificate of like tenor, in lieu of this Warrant
Certificate, representing the right to subscribe for and purchase the number of
Common Shares which may be subscribed for and purchased hereunder.

 

12.

Merger and Successors

 

  (a)

Nothing herein contained shall prevent any consolidation, amalgamation or merger
of the Company with or into any other Person or Persons, or a conveyance or
transfer of all or substantially all of the properties and estates of the
Company as an entirety to any Person lawfully entitled to acquire and operate
same, provided, however, that the Person formed by such consolidation,
amalgamation, arrangement or merger or which acquires by conveyance or transfer
all or substantially all of the properties and estates of the Company as an
entirety shall, simultaneously with such amalgamation, arrangement, merger,
conveyance or transfer, assume the due and punctual performance and observance
of all the covenants and conditions hereof to be performed or observed by the
Company.

 

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  (b)

In case the Company, pursuant to Section 12(a), shall be consolidated,
amalgamated or merged with or into any other Person or Persons or shall convey
or transfer all or substantially all of its properties and estates as an
entirety to any other Person, the successor Person formed by such consolidation,
amalgamation or arrangement, or into which the Company shall have been
consolidated, amalgamated or merged or which shall have received a conveyance or
transfer as aforesaid, shall succeed to and be substituted for the Company
hereunder and such changes in phraseology and form (but not in substance) may be
made in this Warrant Certificate as may be appropriate in view of such
amalgamation, arrangement, merger or transfer.

 

13.

Amendment

This Warrant Certificate may only be amended with the prior written consent of
the Company and the Holder.

 

14.

Severability

If any term or other provision of this Warrant Certificate is invalid, illegal
or incapable of being enforced under any applicable law or as a matter of public
policy, all other conditions and provisions of this Warrant Certificate shall
nevertheless remain in full force and effect. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
Company and the Holder shall negotiate in good faith to modify this Warrant
Certificate so as to effect the original intent of the Company and the Holder as
closely as possible in a mutually acceptable manner in order that the provisions
of this Warrant Certificate be consummated as originally contemplated to the
greatest extent possible.

 

15.

Governing Law

This Warrant Certificate shall be governed by and construed and interpreted in
accordance with the laws of the Province of Ontario and the federal laws of
Canada applicable therein irrespective of the choice of laws principles.

 

16.

Transferability

Subject only to applicable securities laws, the Warrants represented by this
Warrant Certificate are transferable by the Holder to any of its Affiliates and
the term “Holder” shall mean and include any successor, transferee or assignee
of the current or any future Holder. The Warrants represented by this Warrant
Certificate may be transferred by the Holder completing and delivering to the
Company the transfer form attached hereto as Schedule “B”. For greater
certainty, the Warrants represented by this Warrant Certificate are not
transferrable except as described in this Section 16 or with the prior written
consent of the Company.

 

17.

Enurement

This Warrant Certificate and all of its provisions shall enure to the benefit of
the Holder and its permitted assigns and successors and shall be binding upon
the Company and its successors and permitted assigns.

 

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18.

Notice

All notices, requests, claims, demands and other communications under this
Warrant Certificate shall be in writing and shall be given or made (and shall be
deemed to have been duly given or made upon receipt) by delivery in person, by
overnight courier service or by registered or certified mail (postage prepaid,
return receipt requested) to the Holder and the Company at the following
addresses (or at such other address as shall be specified in a notice given in
accordance with this Section 18):

 

  (a)

if to the Holder at:

c/o Constellation Brands, Inc.

207 High Point Drive, Bldg. 100

Victor, New York 14564

Attention: General Counsel

and with a copy (which shall not constitute notice) to:

Osler, Hoskin & Harcourt LLP

100 King Street West, Suite 6200

Toronto, Ontario M5X 1B8

Attention: Emmanuel Pressman and James R. Brown

 

  (b)

if to the Company at:

1 Hershey Drive,

Smiths Falls, ON K7A 0A8

Attention: Chief Executive Officer

with a copy (which shall not constitute notice) to:

Cassels Brock & Blackwell LLP

40 King Street West, Suite 2100

Toronto, Ontario M5H 3C2

Attention: Jonathan Sherman

 

19.

Further Assurances

The Company shall promptly do, make, execute, deliver, or cause to be done,
made, executed or delivered, all such further acts, documents and things as the
Holder may reasonably require from time to time for the purpose of giving effect
to this Warrant Certificate and shall use reasonable efforts and take all such
steps as may be reasonably within its power to implement to their full extent
the provisions of this Warrant Certificate.

 

20.

Currency

All dollar amounts referred to in this Warrant Certificate are in Canadian
dollars.

[Signature page follows]

 

-13-

--------------------------------------------------------------------------------

IN WITNESS WHEREOF the Company has caused this Warrant Certificate to be
executed by a duly authorized signatory effective as of the date first written
above.

 

CANOPY GROWTH CORPORATION By:       Name:   Title:

ACKNOWLEDGEMENT

IN WITNESS WHEREOF, the Holder hereby acknowledges, confirms and consents to the
amendment and restatement of the Original Warrant Certificate as set out in this
Amended and Restated Warrant Certificate.

 

CBG HOLDINGS LLC By:       Name:   Title:

--------------------------------------------------------------------------------

SCHEDULE “A”

SUBSCRIPTION FORM

 

TO:

CANOPY GROWTH CORPORATION

Terms which are not otherwise defined herein shall have the meanings ascribed to
such terms in the Warrant Certificate held by the undersigned and issued by
Canopy Growth Corporation (the “Company”).

The undersigned hereby exercises the right to acquire
                                 Common Shares of the Company in accordance with
and subject to the provisions of such Warrant Certificate and herewith makes
payment of the Exercise Price in full for the said number of Common Shares.

(Please check the ONE box applicable):

 

☐    A    The undersigned holder (i) at the time of exercise of the Warrant is
not in the United States; (ii) is not a U.S. Person (iii) is not exercising the
Warrant on behalf of a U.S. Person or a person in the United States; and
(iv) did not execute or deliver this exercise form in the United States. ☐    B.
   The undersigned holder (i) purchased the Warrants for its own account or the
account of another “accredited investor” as defined in Rule 501(a) of Regulation
D under the U.S. Securities Act (“Accredited Investor”); (ii) is exercising the
Warrants solely for its own account or for the account of such other Accredited
Investor; (iii) each of it and such other person, if any, was an Accredited
Investor on the date the Warrants were acquired and is an Accredited Investor on
the date of exercise of the Warrants; and (iv) the representations and
warranties made by the holder or any beneficial purchaser, as the case may be,
to the Company in connection with the acquisition of the Warrants remain true
and correct on the date hereof. ☐    C.    The undersigned holder has delivered
to the Company an opinion of counsel (which will not be sufficient unless it is
from counsel of recognized standing and in form and substance reasonably
satisfactory to the Company) to the effect that an exemption from the
registration requirements of the U.S. Securities Act and applicable state
securities laws is available.

The Common Shares are to be issued, registered and delivered as follows:

 

Name:   

 

Address in full:   

 

  

 

Note: If further nominees are intended, please attach (and initial) a schedule
giving these particulars.

DATED this              day of                                 , 20        .

 

 

             

 

Signature Guaranteed      (Signature of Warrantholder)

(if required)

 

    

 

 

--------------------------------------------------------------------------------

 

Print full name

 

 

Print full address

Note:

The undersigned holder understands that unless Box A above is checked, the
certificate representing the Common Shares issuable upon exercise of the
Warrants will bear a legend restricting transfer without registration under the
U.S. Securities Act and applicable state securities laws unless an exemption
from registration is available. Certificates representing such Common Shares
will not be registered or delivered to an address in the United States unless
Box B or Box C above is checked. If Box C is checked, any opinion tendered must
be in form and substance reasonably satisfactory to the Company. Holders
planning to deliver an opinion of counsel in connection with the exercise of the
Warrant should contact the Company in advance to determine whether any opinions
to be tendered will be acceptable to the Company.

If Box B or Box C is checked, any certificate representing the Common Shares
issued upon exercise of this Warrant will bear an applicable United States
restrictive legend.

Instructions:

The registered holder may exercise its right to receive Common Shares by
completing this form and surrendering this form and the Warrant Certificate
representing the Warrants being exercised to the Company.

The signature on this Subscription Form must correspond in every particular with
the name shown on the face of the Warrant Certificate without alteration or any
change whatsoever or this Subscription Form must be signed by a duly authorized
signing officer of the Holder. If this Subscription Form is signed by a duly
authorized signing officer of the Holder, the Warrant Certificate must be
accompanied by evidence of authority to sign.

If the Subscription Form indicates that Common Shares are to be issued to a
Person or Persons other than the registered holder of the Warrant Certificate or
an affiliate of such registered holder, the endorsement must be signature
guaranteed, in either case, by a Canadian chartered bank, or a member of a
recognized Securities Transfer Agents Medallion Program (STAMP). The stamp
affixed thereon by the guarantor must bear the actual words “Signature
Guarantee”, or “Signature Medallion Guaranteed” or in accordance with industry
standards.

The certificates will be mailed by registered mail to the Holder(s) at the
address(es) appearing in this Subscription Form.

If any Warrants represented by this certificate are not being exercised, a new
Warrant Certificate will be issued and delivered to the Holder with the Common
Share certificates in accordance with the provisions of the Warrant Certificate.

--------------------------------------------------------------------------------

SCHEDULE “B”

TRANSFER FORM

 

TO:

CANOPY GROWTH CORPORATION

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
                                         
                                                                            
(include name and address of the transferee)                                 
(include number) Warrants exercisable for common shares of Canopy Growth
Corporation (the “Company”) registered in the name of the undersigned on the
register of the Company maintained therefor, and hereby irrevocably appoints
                                         
                                                 the attorney of the undersigned
to transfer the said securities on the books maintained by the Company with full
power of substitution.

THE UNDERSIGNED TRANSFEROR HEREBY CERTIFIES AND DECLARES that the Warrants are
not being offered, sold or transferred to, or for the account or benefit of, a
“U.S. person” (as defined in Rule 902(k) of Regulation S under the United States
Securities Act of 1933, as amended (the “U.S. Securities Act”)) or a person
within the United States unless the Warrants are registered under the U.S.
Securities Act and any applicable state securities laws or unless an exemption
from such registration is available.

DATED this                      day of                                     ,
20            .

 

 

    

 

Signature Guaranteed      (Signature of Warrantholder)     

 

              Print full name     

 

    

 

     Print full address

Instructions:

The signature on this Transfer Form must correspond in every particular with the
name shown on the face of the Warrant Certificate without alteration or any
change whatsoever or this Subscription Form must be signed by a duly authorized
signing officer of the Holder. If this Subscription Form is signed by a duly
authorized signing officer of the Holder, the Warrant Certificate must be
accompanied by evidence of authority to sign.

The endorsement must be signature guaranteed, in either case, by a Canadian
chartered bank, or a member of a recognized Securities Transfer Agents Medallion
Program (STAMP). The stamp affixed thereon by the guarantor must bear the actual
words “Signature Guarantee”, or “Signature Medallion Guaranteed” or in
accordance with industry standards.

If any Warrants represented by this certificate are not being transferred, a new
Warrant Certificate will be issued and delivered to the Holder.

--------------------------------------------------------------------------------

Form of Tranche B Amended Warrant Certificate

(see attached)

Exhibit A-3

--------------------------------------------------------------------------------

TRANCHE B

AMENDED AND RESTATED

COMMON SHARE PURCHASE WARRANT

THE SECURITIES REPRESENTED HEREBY AND THE SECURITIES ISSUABLE UPON EXERCISE
HEREOF HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR U.S. STATE
SECURITIES LAWS. THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE
HEREOF MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED, DIRECTLY OR
INDIRECTLY, ONLY (A) TO CANOPY GROWTH CORPORATION (THE “CORPORATION”), (B)
OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE
U.S. SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE LOCAL LAWS AND
REGULATIONS, (C) IN COMPLIANCE WITH THE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS UNDER THE U.S. SECURITIES ACT PROVIDED BY (I) RULE 144 THEREUNDER
IF AVAILABLE OR (II) RULE 144A THEREUNDER, IF AVAILABLE, AND IN EACH CASE IN
ACCORDANCE WITH APPLICABLE U.S. STATE SECURITIES LAWS, (D) IN ANOTHER
TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE U.S. SECURITIES ACT OR
ANY APPLICABLE STATE SECURITIES LAWS, OR (E) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE U.S. SECURITIES ACT, PROVIDED THAT, IN THE CASE
OF TRANSFERS PURSUANT TO (C)(I) OR (D) ABOVE, THE HOLDER HAS, PRIOR TO SUCH
TRANSFER, FURNISHED TO THE CORPORATION AN OPINION OF COUNSEL OR OTHER EVIDENCE
OF EXEMPTION, IN EITHER CASE REASONABLY SATISFACTORY TO THE CORPORATION.
DELIVERY OF THIS CERTIFICATE MAY NOT CONSTITUTE “GOOD DELIVERY” IN SETTLEMENT OF
TRANSACTIONS ON STOCK EXCHANGES IN CANADA.”

THIS WARRANT MAY NOT BE EXERCISED IN THE UNITED STATES OR BY OR ON BEHALF OF A
U.S. PERSON OR PERSON IN THE UNITED STATES UNLESS THIS WARRANT AND SHARES
ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT AND THE APPLICABLE SECURITIES LEGISLATION OF ANY SUCH STATE OR
EXEMPTIONS FROM SUCH REGISTRATION REQUIREMENTS ARE AVAILABLE. “UNITED STATES”
AND “U.S. PERSON” ARE AS DEFINED BY REGULATION S UNDER THE U.S. SECURITIES ACT.

WARRANTS TO PURCHASE COMMON SHARES OF

CANOPY GROWTH CORPORATION

 

Warrant Certificate Number:    Number of Warrants: 2018 – B-1    38,454,444   
Date:    ●, 2019

Effective as of the date hereof, this Warrant Certificate amends, re-evidences,
restates, replaces and supersedes 38,454,444 common share purchase warrants
issued by the Company to the Holder (as each such term is defined below)
pursuant to the tranche B common share purchase warrant dated November 1, 2018
(the “Original Warrant Certificate”).

--------------------------------------------------------------------------------

THIS CERTIFIES THAT, for value received, CBG Holdings LLC (the “Holder”) is
entitled, at any time prior to the Expiry Time, to purchase, at the Exercise
Price, one fully paid, validly issued and non-assessable Common Share for each
Warrant vested and exercisable under this Warrant Certificate, by surrendering
to the Company, at its principal office at 1 Hershey Drive, Smith Falls,
Ontario, K7A 0A8, this Warrant Certificate, together with a Subscription Form,
duly completed and executed, and immediately available funds by wire transfer of
lawful money of Canada payable to or to the order of the Company for an amount
equal to the Exercise Price multiplied by the number of Common Shares subscribed
for, on and subject to the terms and conditions set forth below.

Nothing contained herein shall confer any right upon the Holder to subscribe for
or purchase any Common Shares at any time after the Expiry Time, and from and
after the Expiry Time, this Warrant Certificate and all rights hereunder shall
be void and of no value.

 

1.

Defined Terms

Capitalized terms used in this Warrant Certificate, including the preamble,
shall have the following meanings:

“Adjustment Period” means the period commencing on the date hereof and ending at
the Expiry Time.

“Affiliate” means, with respect to any Person, any Person now or hereafter
existing, directly or indirectly, Controlled by, Controlling, or under common
Control with, such Person, whether on or after the date hereof.

“Business Day” means a day other than a Saturday, Sunday or other day on which
commercial banks in Smiths Falls, Ontario are authorized or required by law to
close. Any event the scheduled occurrence of which would fall on a day that is
not a Business Day shall be deferred until the next succeeding Business Day.

“Capital Reorganization” has the meaning ascribed to such term in
Section 10(a)(iv).

“Common Share” means a common share in the capital of the Company or such other
shares or other securities into which such common share is converted, exchanged,
reclassified or otherwise changed, as the case may be, from time to time.

“Company” means Canopy Growth Corporation, a corporation existing under the
federal laws of Canada, and its successors and assigns.

“Consent Agreement” means the consent agreement between the Holder and the
Company dated April 18, 2019.

“Control” means:

 

  (a)

in relation to a corporation, the direct or indirect beneficial ownership at the
relevant time of shares of such corporation carrying more than 50% of the voting
rights ordinarily exercisable at meetings of shareholders of the Company where
such voting rights are sufficient to elect a majority of the directors of the
Company;

 

  (b)

in relation to a Person that is a partnership, limited liability company or
joint venture, the direct or indirect beneficial ownership at the relevant time
of more than 50% of the ownership interests of the partnership, limited
liability company or joint venture in circumstances where it can reasonably be
expected that the Person can direct the affairs of the partnership, limited
liability company or joint venture; and

 

-2-

--------------------------------------------------------------------------------

  (c)

in relation to a trust, the direct or indirect beneficial ownership at the
relevant time of more than 50% of the property settled under the trust;

and the words “ Controlled by”, “Controlling” and similar words have
corresponding meanings; the Person who directly or indirectly Controls a
Controlled Person or entity shall be deemed to Control a corporation,
partnership, limited liability company, joint venture or trust which is
Controlled by the Controlled Person or entity, and so on.

“Current Market Price” means, at the relevant time of reference, the price per
share equal to the volume-weighted average trading price of the Common Shares on
the TSX for the five Trading Days immediately preceding the relevant record
date.

“Exercise Price” means $76.68, as may be adjusted in accordance with this
Warrant Certificate.

“Expiry Time” means 5:00 p.m. (Toronto time) on November 1, 2026.

“NYSE” means the New York Stock Exchange.

“Person” means an individual, corporation, partnership, unincorporated
syndicate, unincorporated organization, trust, trustee, executor, administrator,
or other legal representative, or any group or combination thereof.

“Repurchase Period” means the period commencing on April 18, 2019 and ending on
the date that is 24 months after the date that all of the Tranche A Warrants
have been exercised by the Holder.

“Rights Offering” has the meaning ascribed to such term in Section 10(a)(ii).

“Rights Period” has the meaning ascribed to such term in Section 10(a)(ii).

“Special Distribution” has the meaning ascribed to such term in
Section 10(a)(iii).

“Subscription Form” means the form of subscription annexed hereto as Schedule
“A”.

“Trading Day” means a day on which the TSX is open for business.

“Tranche A Warrants ” means the 88,472,861 Common Share purchase warrants
represented by the tranche A amended and restated warrant certificate issued by
the Company to the Holder on the date hereof.

“Tranche C Warrants” means the 12,818,148 Common Share purchase warrants
represented by the tranche C warrant certificate issued by the Company to the
Holder on the date hereof.

“Tranche C Warrant Certificate” means the warrant certificate representing the
Tranche C Warrants.

“TSX” means the Toronto Stock Exchange.

“United States” means the United States of America, its territories and
possessions, any state of the United States and the District of Columbia.

 

-3-

--------------------------------------------------------------------------------

“U.S. Person” means “U.S. person” as defined in Rule 902(k) of Regulation S
under the U.S. Securities Act.

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

“Warrants” means the tranche B Common Share purchase warrants represented by
this Warrant Certificate.

 

2.

Vesting of Warrants

The Warrants represented by this Warrant Certificate shall vest and become
immediately exercisable once all Tranche A Warrants have been exercised in
accordance with their terms, and shall remain exercisable by the Holder, in
whole or in part at any time, and from time to time, thereafter and prior to the
Expiry Time.

 

3.

Exercise of Warrants

 

  (a)

Subject to Section 2, the rights represented by this Warrant Certificate may be
exercised by the Holder, in whole or in part, by the surrender of this Warrant
Certificate, with the attached Subscription Form duly executed, at the principal
office of the Company at 1 Hershey Drive, Smiths Falls, Ontario K7A 0A8 (or such
other office of the Company as it may designate by notice in writing to the
Holder at the address of such Holder appearing on the books of the Company at
any time and from time to time during the period within which the rights
represented by this Warrant Certificate may be exercised) and upon payment to or
to the order of the Company of immediately available funds by wire transfer of
lawful money of Canada in an amount equal to the Exercise Price per Common Share
multiplied by the aggregate number of Common Shares to be issued on such
exercise of this Warrant (as such amount may be adjusted in accordance with
Section 5). In the event that the Holder subscribes for and purchases any such
lesser number of Common Shares prior to the Expiry Time, the Holder shall be
entitled to receive a replacement Warrant Certificate, without charge,
representing the unexercised balance of the Warrants as soon as practicable, and
in any event within five Business Days, after the Warrants represented by this
Warrant Certificate shall have been so exercised.

 

  (b)

The Company agrees that the Common Shares so purchased shall be and be deemed to
be issued to the Holder as the registered owner of such Common Shares as of the
close of business on the date on which both this Warrant Certificate shall have
been surrendered and payment made for such Common Shares as aforesaid.
Certificates for the Common Shares so purchased shall be delivered to the Holder
as soon as practicable, and in any event within five Business Days, after the
Warrants represented by this Warrant Certificate shall have been so exercised.

 

4.

Ability to Exercise

Subject to Section 2, the Warrants may be exercised in whole or in part at any
time and from time to time prior to the Expiry Time. After the Expiry Time, all
rights under any outstanding Warrants evidenced hereby, in respect of which the
rights of subscription and purchase herein provided for shall not have been
exercised, shall wholly cease and terminate and such Warrants shall be void and
of no value or effect.

 

-4-

--------------------------------------------------------------------------------

5.

Exercise Price Credit

If, for any reason, the Company has not within the Repurchase Period, purchased
for cancellation Common Shares required to be purchased pursuant to section 2.3
of the Consent Agreement, the Company hereby agrees and acknowledges that the
Holder will be credited an amount (the “Credit Amount”) that will reduce the
aggregate exercise price otherwise payable by the Holder upon each exercise of
the Warrants represented by this Warrant Certificate equal to the difference
between:

 

  (a)

$1,582,995,262; and

 

  (b)

the actual purchase price paid by the Company in purchasing Common Shares
pursuant to section 2.3 of the Consent Agreement.

 

6.

No Fractional Common Shares

No fractional Common Shares will be issuable upon any exercise of the Warrants
and the Holder will not be entitled to any cash payment or compensation in lieu
of a fractional Common Share.

 

7.

Not a Shareholder

The holding of the Warrants shall not constitute the Holder a shareholder of the
Company nor entitle the Holder to any right or interest in respect thereof,
except as expressly provided in this Warrant Certificate.

 

8.

Covenants and Representations of the Company The Company covenants and agrees as
follows:

 

  (a)

this Warrant Certificate is a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms;

 

  (b)

all Common Shares which may be issued upon the exercise of the rights
represented by the Warrants will, upon issuance, be validly issued, fully paid
and non-assessable, free from all taxes, liens and charges with respect to the
issue thereof, except with respect to any applicable withholding taxes; and

 

  (c)

during the period within which the rights represented by this Warrant
Certificate may be exercised, the Company will at all times have authorized and
reserved a sufficient number of its Common Shares to provide for the exercise of
the rights represented by this Warrant Certificate.

 

9.

Covenant of the Holder

 

  (a)

The Holder covenants and agrees that in respect of each Common Share purchased
by the Holder or any affiliate of the Holder, including Greenstar Canada
Investment Limited Partnership and Constellation Brands, Inc. and its
Subsidiaries (as defined in National Instrument 45-106 – Prospectus Exemptions),
(i) on the TSX, the NYSE or any other stock exchange, marketplace or trading
market on which the Common Shares are then listed; or (ii) through private
agreement transactions with existing holders of Common Shares, the number of
Warrants represented by this Warrant Certificate shall be reduced by the number
of Common Shares so acquired (up to an aggregate maximum reduction of 20,000,000
Common Shares less the number of Common Shares, if any, by which the Tranche C
Warrants have been reduced pursuant to section 9(a) of the Tranche C Warrant
Certificate).

 

-5-

--------------------------------------------------------------------------------

  (b)

At the time of exercise of the Warrants, the Holder shall confirm the number of
Common Shares purchased as contemplated by Section 9(a).

 

  (c)

For certainty, the aggregate reduction in the number of Warrants represented by
this Warrant Certificate pursuant to Section 9(a) hereof and in the number of
Tranche C Warrants represented by the Tranche C Warrant Certificate pursuant to
section 9(a) thereof shall not exceed 20,000,000 Warrants.

 

  (d)

The Holder shall have the right, but not the obligation, to surrender this
Warrant Certificate at the principal office of the Company at 1 Hershey Drive,
Smiths Falls, Ontario K7A 0A8 (or such other office of the Company as it may
designate by notice in writing to the Holder at the address of such Holder
appearing on the books of the Company at any time and from time to time during
the period within which the rights represented by this Warrant Certificate may
be exercised) and, if the Holder exercises such right, the Holder shall
thereafter be entitled to receive a replacement Warrant Certificate, without
charge, representing the reduced balance of the Warrants as soon as practicable,
and in any event within five Business Days, after the Warrants represented by
this Warrant Certificate shall have been so surrendered and cancelled. If the
Holder does not exercise such right, this Warrant Certificate shall continue to
evidence in full the Warrants and the number of Warrants indicated on the cover
page of this Warrant Certificate shall be deemed to be reduced by the number of
Warrants contemplated by Section 9(a) hereof.

 

10.

Anti-Dilution Protection

 

  (a)

The Exercise Price and the number of Common Shares issuable to the Holder upon
the exercise of the Warrants shall be subject to adjustment from time to time in
the events and in the manner provided as follows:

 

  (i)

If at any time during the Adjustment Period the Company shall:

 

  (A)

fix a record date for the issue of, or issue, Common Shares to the holders of
all or substantially all of the outstanding Common Shares by way of a share
dividend;

 

  (B)

fix a record date for the distribution to, or make a distribution to, the
holders of all or substantially all of the outstanding Common Shares payable in
Common Shares or securities exchangeable for or convertible into Common Shares;

 

  (C)

subdivide the outstanding Common Shares into a greater number of Common Shares;
or

 

  (D)

consolidate the outstanding Common Shares into a smaller number of Common
Shares,

(any of such events in subsections (A), (B) (C) and (D) above being called a
“Common Share Reorganization”), the Exercise Price shall be adjusted on the
earlier of the record date on which holders of Common Shares are determined for
the purposes of the Common Share Reorganization and the effective date of the
Common Share Reorganization to the amount determined by multiplying the Exercise
Price in effect immediately prior to such record date or effective date, as the
case may be, by a fraction:

 

-6-

--------------------------------------------------------------------------------

  (A)

the numerator of which shall be the number of Common Shares outstanding on such
record date or effective date, as the case may be, before giving effect to such
Common Share Reorganization; and

 

  (B)

the denominator of which shall be the number of Common Shares which will be
outstanding immediately after giving effect to such Common Share Reorganization
(including, in the case of a distribution of securities exchangeable for or
convertible into Common Shares, the number of Common Shares that would have been
outstanding had such securities been exchanged for or converted into Common
Shares on such record date or effective date, as the case may be).

To the extent that any adjustment in the Exercise Price occurs pursuant to this
Section 10(a)(i) as a result of the fixing by the Company of a record date for
the distribution of securities exchangeable for or convertible into Common
Shares, the Exercise Price shall be readjusted immediately after the expiry of
any relevant exchange or conversion right to the Exercise Price which would then
be in effect based upon the number of Common Shares actually issued and
remaining issuable after such expiry and shall be further readjusted in such
manner upon the expiry of any further such right.

 

  (ii)

If at any time during the Adjustment Period the Company shall fix a record date
for the issue or distribution to the holders of all or substantially all of the
outstanding Common Shares of rights, options or warrants pursuant to which such
holders are entitled, during a period expiring not more than 45 days after the
record date for such issue (such period being the “Rights Period”), to subscribe
for or purchase Common Shares or securities exchangeable for or convertible into
Common Shares at a price per share to the holder (or in the case of securities
exchangeable for or convertible into Common Shares, at an exchange or conversion
price per share) at the date of issue of such securities of less than the
Current Market Price of the Common Shares on such record date (any of such
events being called a “Rights Offering”), the Exercise Price shall be adjusted
effective immediately after the record date for such Rights Offering to the
amount determined by multiplying the Exercise Price in effect on such record
date by a fraction:

 

  (A)

the numerator of which shall be the aggregate of:

 

  (1)

the number of Common Shares outstanding on the record date for the Rights
Offering, and

 

  (2)

the quotient determined by dividing

 

  I.

either (a) the product of the number of Common Shares offered during the Rights
Period pursuant to the Rights Offering and the price at which such Common Shares
are offered, or (b) the product of the exchange or conversion price of the
securities so offered and the number of Common Shares for or into which the
securities offered pursuant to the Rights Offering may be exchanged or
converted, as the case may be, by

 

-7-

--------------------------------------------------------------------------------

  II.

the Current Market Price of the Common Shares as of the record date for the
Rights Offering; and

 

  (B)

the denominator of which shall be the aggregate of the number of Common Shares
outstanding on such record date and the number of Common Shares offered pursuant
to the Rights Offering (including in the case of the issue or distribution of
securities exchangeable for or convertible into Common Shares the number of
Common Shares for or into which such securities may be exchanged or converted).

If by the terms of the rights, options, or warrants referred to in this
Section 10(a)(ii), there is more than one purchase, conversion or exchange price
per Common Share, the aggregate price of the total number of additional Common
Shares offered for subscription or purchase, or the aggregate conversion or
exchange price of the convertible or exchangeable securities so offered, shall
be calculated for purposes of the adjustment on the basis of the lowest
purchase, conversion or exchange price per Common Share, as the case may be. Any
Common Shares owned by or held for the account of the Company shall be deemed
not to be outstanding for the purpose of any such calculation. To the extent
that any adjustment in the Exercise Price occurs pursuant to this
Section 10(a)(ii) as a result of the fixing by the Company of a record date for
the issue or distribution of rights, options or warrants referred to in this
Section 10(a)(ii), the Exercise Price shall be readjusted immediately after the
expiry of any relevant exchange, conversion or exercise right to the Exercise
Price which would then be in effect based upon the number of Common Shares
actually issued and remaining issuable after such expiry and shall be further
readjusted in such manner upon the expiry of any further such right.

 

  (iii)

If at any time during the Adjustment Period the Company shall fix a record date
for the issue or distribution to the holders of all or substantially all of the
outstanding Common Shares of:

 

  (A)

shares of the Company of any class other than Common Shares;

 

  (B)

rights, options or warrants to acquire Common Shares or securities exchangeable
for or convertible into Common Shares (other than rights, options or warrants
pursuant to which holders of Common Shares are entitled, during a period
expiring not more than 45 days after the record date for such issue, to
subscribe for or purchase Common Shares or securities exchangeable for or
convertible into Common Shares at a price per share (or in the case of
securities exchangeable for or convertible into Common Shares at an exchange or
conversion price per share) at the date of issue of such securities to the
holder of at least the Current Market Price of the Common Shares on such record
date);

 

  (C)

evidences of indebtedness of the Company; or

 

  (D)

any property or assets of the Company;

and if such issue or distribution does not constitute a Common Share
Reorganization or a Rights Offering (any of such non-excluded events being
called a “Special Distribution”), the Exercise Price shall be adjusted effective
immediately after the record date for the Special Distribution to the amount
determined by multiplying the Exercise Price in effect on the record date for
the Special Distribution by a fraction:

 

-8-

--------------------------------------------------------------------------------

  (1)

the numerator of which shall be the difference between:

 

  I.

the product of the number of Common Shares outstanding on such record date and
the Current Market Price of the Common Shares on such record date, and

 

  II.

the fair value, as determined in good faith by the directors of the Company, to
the holders of Common Shares of the shares, rights, options, warrants, evidences
of indebtedness or property or assets to be issued or distributed in the Special
Distribution; and

 

  (2)

the denominator of which shall be the product obtained by multiplying the number
of Common Shares outstanding on such record date by the Current Market Price of
the Common Shares on such record date.

Any Common Shares owned by or held for the account of the Company shall be
deemed not to be outstanding for the purpose of such calculation. To the extent
that any adjustment in the Exercise Price occurs pursuant to this
Section 10(a)(iii) as a result of the fixing by the Company of a record date for
the issue or distribution of rights, options or warrants to acquire Common
Shares or securities exchangeable for or convertible into Common Shares referred
to in this Section 10(a)(iii), the Exercise Price shall be readjusted
immediately after the expiry of any relevant exercise, exchange or conversion
right to the amount which would then be in effect based upon the number of
Common Shares issued and remaining issuable after such expiry and shall be
further readjusted in such manner upon the expiry of any further such right.

 

  (iv)

If at any time during the Adjustment Period there shall occur:

 

  (A)

a reclassification or redesignation of the Common Shares, any change of the
Common Shares into other shares or securities or any other capital
reorganization involving the Common Shares other than a Common Share
Reorganization;

 

  (B)

a consolidation, amalgamation, arrangement or merger of the Company with or into
another body corporate which results in a reclassification or redesignation of
the Common Shares or a change of the Common Shares into other shares or
securities;

 

  (C)

the transfer of the undertaking or assets of the Company as an entirety or
substantially as an entirety to another company or entity;

(any of such events being called a “Capital Reorganization”), after the
effective date of the Capital Reorganization the Holder shall be entitled to
receive, and shall accept, for the same aggregate consideration, upon exercise
of the Warrants, in lieu of the number of Common Shares to

 

-9-

--------------------------------------------------------------------------------

which the Holder was theretofore entitled upon the exercise of the Warrants, the
kind and aggregate number of shares and other securities or property resulting
from the Capital Reorganization which the Holder would have been entitled to
receive as a result of the Capital Reorganization if, on the effective date
thereof, the Holder had been the registered holder of the number of Common
Shares which the Holder was theretofore entitled to purchase or receive upon the
exercise of the Warrants. If necessary, as a result of any such Capital
Reorganization, appropriate adjustments shall be made in the application of the
provisions of this Warrant Certificate with respect to the rights and interests
thereafter of the Holder to the end that the provisions shall thereafter
correspondingly be made applicable as nearly as may reasonably be possible in
relation to any shares or other securities or property thereafter deliverable
upon the exercise of the Warrants.

 

  (v)

If at any time during the Adjustment Period any adjustment or readjustment in
the Exercise Price shall occur pursuant to the provisions of Sections 10(a)(i)
or (a)(iii) of this Warrant Certificate, then the number of Common Shares
purchasable upon the subsequent exercise of the Warrants shall be simultaneously
adjusted or readjusted, as the case may be, by multiplying the number of Common
Shares purchasable upon the exercise of the Warrants immediately prior to such
adjustment or readjustment by a fraction which shall be the reciprocal of the
fraction used in the adjustment or readjustment of the Exercise Price.

 

  (b)

The following rules and procedures shall be applicable to adjustments made
pursuant to Section 10(a) of this Warrant Certificate:

 

  (i)

subject to the following sections of this Section 10(b), any adjustment made
pursuant to Section 10(a) of this Warrant Certificate shall be made successively
whenever an event referred to therein shall occur;

 

  (ii)

no adjustment in the Exercise Price shall be required unless such adjustment
would result in a change of at least one percent in the then Exercise Price and
no adjustment shall be made in the number of Common Shares purchasable or
issuable on the exercise of the Warrants unless it would result in a change of
at least one one-hundredth of a Common Share; provided, however, that any
adjustments which except for the provision of this Section 10(b)(ii) would
otherwise have been required to be made shall be carried forward and taken into
account in any subsequent adjustment. Notwithstanding any other provision of
Section 10(a) of this Warrant Certificate, no adjustment of the Exercise Price
shall be made which would result in an increase in the Exercise Price or a
decrease in the number of Common Shares issuable upon the exercise of the
Warrants (except in respect of a consolidation of the outstanding Common
Shares);

 

  (iii)

if at any time during the Adjustment Period the Company shall take any action
affecting the Common Shares, other than an action or event described in
Section 10(a) of this Warrant Certificate, which in the opinion of the directors
of the Company would have an adverse effect upon the rights of the Holder, the
Exercise Price and/or the number of Common Shares purchasable under the Warrants
shall, subject to any necessary regulatory approval, be adjusted in such manner
and at such time as the directors of the Company may determine to be equitable
in the circumstances, provided that no such action shall be taken unless and
until the Holder has been provided with notice of such proposed action and the
consequences thereof;

 

-10-

--------------------------------------------------------------------------------

  (iv)

if the Company sets a record date to determine holders of Common Shares for the
purpose of entitling such holders to receive any dividend or distribution or any
subscription or purchase rights and shall thereafter and before the distribution
to such holders of any such dividend, distribution or subscription or purchase
rights legally abandon its plan to pay or deliver such dividend, distribution or
subscription or purchase rights, then no adjustment in the Exercise Price or the
number of Common Shares purchasable under the Warrants shall be required by
reason of the setting of such record date;

 

  (v)

no adjustment in the Exercise Price or in the number or kind of securities
purchasable on the exercise of the Warrants shall be made in respect of any
event described in Section 10 of this Warrant Certificate if (subject to TSX and
NYSE approval) the Holder is entitled to participate in such event on the same
terms mutatis mutandis as if the Holder had exercised the Warrants prior to or
on the record date or effective date, as the case may be, of such event. Any
such participation by the Holder is subject to regulatory approval; and

 

  (vi)

in any case in which this Warrant Certificate shall require that an adjustment
shall become effective immediately after a record date for an event referred to
in Section 10(a) hereof, the Company may defer, until the occurrence of such
event:

 

  (A)

issuing to the Holder, to the extent that the Warrants are exercised after such
record date and before the occurrence of such event, the additional Common
Shares issuable upon such exercise by reason of the adjustment required by such
event; and

 

  (B)

delivering to the Holder any distribution declared with respect to such
additional Common Shares after such record date and before such event;

provided, however, that the Company shall deliver to the Holder an appropriate
instrument evidencing the right of the Holder upon the occurrence of the event
requiring the adjustment, to an adjustment in the Exercise Price or the number
of Common Shares purchasable upon the exercise of the Warrants and to such
distribution declared with respect to any such additional Common Shares issuable
on the exercise of the Warrants.

 

  (c)

At least 10 days prior to the earlier of the record date or effective date of
any event which requires or might require an adjustment in any of the rights of
the Holder under this Warrant Certificate, including the Exercise Price or the
number of Common Shares which may be purchased under this Warrant Certificate,
the Company shall deliver to the Holder a certificate of the Company specifying
the particulars of such event and, if determinable, the required adjustment and
the calculation of such adjustment. In case any adjustment for which a notice in
this Section 10(c) has been given is not then determinable, the Company shall
promptly after such adjustment is determinable deliver to the Holder a
certificate providing the calculation of such adjustment. The Company hereby
covenants and agrees that the Company will not take any action which might
deprive the Holder of the opportunity of exercising the rights of subscription
contained in this Warrant Certificate, during such 10 day period.

 

-11-

--------------------------------------------------------------------------------

  (d)

In connection with any: (i) reclassification or redesignation of the Common
Shares, any change of the Common Shares into other shares or securities or any
other capital reorganization involving the Common Shares other than as set forth
in this Section 10; (ii) consolidation, amalgamation, arrangement or merger of
the Company with or into another body corporate which results in a
reclassification or redesignation of the Common Shares or a change of the Common
Shares into other shares or securities (including, without limitation, pursuant
to a “take-over bid”, “tender offer” or other acquisition of all or
substantially all of the outstanding Common Shares); or (iii) sale, transfer or
lease to another corporation of all or substantially all the property or assets
of the Company, the Holder shall have the right thereafter, upon payment of the
Exercise Price in effect immediately prior to such action, to purchase upon
exercise of each Warrant the kind and amount of shares and other securities and
property which it would have owned or have been entitled to receive after the
happening of such reclassification, redesignation, consolidation, amalgamation,
arrangement, merger, sale, transfer or lease had such Warrant been exercised
immediately prior to such action, and the Holder shall be bound to accept such
shares and other securities and property in lieu of the Common Shares to which
it was previously entitled; provided, however, that no adjustment in respect of
dividends, interest or other income on or from such shares or other securities
and property shall be made during the term of a Warrant or upon the exercise of
a Warrant. If necessary, as a result of any actions contemplated by this
paragraph, appropriate adjustments shall be made in the application of the
provisions of this Warrant Certificate with respect to the rights and interests
thereafter of the Holder to the end that the provisions shall thereafter
correspondingly be made applicable as nearly as may reasonably be possible in
relation to any shares or other securities or property thereafter deliverable
upon the exercise of the Warrants. The provisions of this paragraph shall
similarly apply to successive consolidations, mergers, amalgamation, sales,
transfers or leases.

 

11.

U.S. Registration

This Warrant and the Common Shares issuable upon exercise of this Warrant have
not been and will not be registered under the U.S. Securities Act or under state
securities laws of any state in the United States. Accordingly, this Warrant may
not be transferred or exercised in the United States or by or on behalf of a
U.S. Person or a person in the United States unless an exemption is available
from the registration requirements of the U.S. Securities Act and applicable
state securities laws and, if required by the Company, the holder of this
Warrant has furnished an opinion of counsel of recognized standing in form and
substance reasonably satisfactory to the Company to such effect, as applicable.

 

12.

Authorized Shares

As a condition precedent to the taking of any action which would require an
adjustment pursuant to Section 10 of this Warrant Certificate, the Company shall
take any action which may be necessary in order that the Company has issued and
reserved in its authorized capital, and may validly and legally issue as fully
paid and non-assessable, all of the Common Shares (or other shares and
securities, if applicable) which the Holder of the Warrants is entitled to
receive on the exercise hereof.

 

13.

Mutilated or Missing Warrant Certificate

Upon receipt of evidence satisfactory to the Company of the loss, theft,
destruction or mutilation of this Warrant Certificate and, in the case of any
such loss, theft or destruction, upon delivery of a bond or indemnity
satisfactory to the Company, or, in the case of any such mutilation, upon
surrender or cancellation of this Warrant Certificate, the Company will issue to
the Holder a new warrant certificate of like tenor, in lieu of this Warrant
Certificate, representing the right to subscribe for and purchase the number of
Common Shares which may be subscribed for and purchased hereunder.

 

-12-

--------------------------------------------------------------------------------

14.

Merger and Successors

 

  (a)

Nothing herein contained shall prevent any consolidation, amalgamation or merger
of the Company with or into any other Person or Persons, or a conveyance or
transfer of all or substantially all of the properties and estates of the
Company as an entirety to any Person lawfully entitled to acquire and operate
same, provided, however, that the Person formed by such consolidation,
amalgamation, arrangement or merger or which acquires by conveyance or transfer
all or substantially all of the properties and estates of the Company as an
entirety shall, simultaneously with such amalgamation, arrangement, merger,
conveyance or transfer, assume the due and punctual performance and observance
of all the covenants and conditions hereof to be performed or observed by the
Company.

 

  (b)

In case the Company, pursuant to Section 14(a), shall be consolidated,
amalgamated or merged with or into any other Person or Persons or shall convey
or transfer all or substantially all of its properties and estates as an
entirety to any other Person, the successor Person formed by such consolidation,
amalgamation or arrangement, or into which the Company shall have been
consolidated, amalgamated or merged or which shall have received a conveyance or
transfer as aforesaid, shall succeed to and be substituted for the Company
hereunder and such changes in phraseology and form (but not in substance) may be
made in this Warrant Certificate as may be appropriate in view of such
amalgamation, arrangement, merger or transfer.

 

15.

Amendment

This Warrant Certificate may only be amended with the prior written consent of
the Company and the Holder.

 

16.

Severability

If any term or other provision of this Warrant Certificate is invalid, illegal
or incapable of being enforced under any applicable law or as a matter of public
policy, all other conditions and provisions of this Warrant Certificate shall
nevertheless remain in full force and effect. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
Company and the Holder shall negotiate in good faith to modify this Warrant
Certificate so as to effect the original intent of the Company and the Holder as
closely as possible in a mutually acceptable manner in order that the provisions
of this Warrant Certificate be consummated as originally contemplated to the
greatest extent possible.

 

17.

Governing Law

This Warrant Certificate shall be governed by and construed and interpreted in
accordance with the laws of the Province of Ontario and the federal laws of
Canada applicable therein irrespective of the choice of laws principles.

 

-13-

--------------------------------------------------------------------------------

18.

Transferability

Subject only to applicable securities laws, the Warrants represented by this
Warrant Certificate are transferable by the Holder to any of its Affiliates and
the term “Holder” shall mean and include any successor, transferee or assignee
of the current or any future Holder. The Warrants represented by this Warrant
Certificate may be transferred by the Holder completing and delivering to the
Company the transfer form attached hereto as Schedule “B”. For greater
certainty, the Warrants represented by this Warrant Certificate are not
transferrable except as described in this Section 18 or with the prior written
consent of the Company.

 

19.

Enurement

This Warrant Certificate and all of its provisions shall enure to the benefit of
the Holder and its permitted assigns and successors and shall be binding upon
the Company and its successors and permitted assigns.

 

20.

Notice

All notices, requests, claims, demands and other communications under this
Warrant Certificate shall be in writing and shall be given or made (and shall be
deemed to have been duly given or made upon receipt) by delivery in person, by
overnight courier service or by registered or certified mail (postage prepaid,
return receipt requested) to the Holder and the Company at the following
addresses (or at such other address as shall be specified in a notice given in
accordance with this Section 20):

 

  (a)

if to the Holder at:

c/o Constellation Brands, Inc.

207 High Point Drive, Bldg. 100

Victor, New York 14564

Attention: General Counsel

and with a copy (which shall not constitute notice) to:

Osler, Hoskin & Harcourt LLP

100 King Street West, Suite 6200

Toronto, Ontario M5X 1B8

Attention: Emmanuel Pressman and James R. Brown

 

  (b)

if to the Company at:

1 Hershey Drive,

Smiths Falls, ON K7A 0A8

Attention: Chief Executive Officer

with a copy (which shall not constitute notice) to:

Cassels Brock & Blackwell LLP

40 King Street West, Suite 2100

Toronto, Ontario M5H 3C2

Attention: Jonathan Sherman

 

-14-

--------------------------------------------------------------------------------

21.

Further Assurances

The Company shall promptly do, make, execute, deliver, or cause to be done,
made, executed or delivered, all such further acts, documents and things as the
Holder may reasonably require from time to time for the purpose of giving effect
to this Warrant Certificate and shall use reasonable efforts and take all such
steps as may be reasonably within its power to implement to their full extent
the provisions of this Warrant Certificate.

 

22.

Currency

All dollar amounts referred to in this Warrant Certificate are in Canadian
dollars.

[Signature page follows]

 

-15-

--------------------------------------------------------------------------------

IN WITNESS WHEREOF the Company has caused this Warrant Certificate to be
executed by a duly authorized signatory effective as of the date first written
above.

 

CANOPY GROWTH CORPORATION By:       Name:   Title:

ACKNOWLEDGEMENT

IN WITNESS WHEREOF, the Holder hereby acknowledges, confirms and consents to the
amendment and restatement of the Original Warrant Certificate as set out in this
Amended and Restated Warrant Certificate.

 

CBG HOLDINGS LLC By:       Name:   Title:

--------------------------------------------------------------------------------

SCHEDULE “A”

SUBSCRIPTION FORM

 

TO:

CANOPY GROWTH CORPORATION

Terms which are not otherwise defined herein shall have the meanings ascribed to
such terms in the Warrant Certificate held by the undersigned and issued by
Canopy Growth Corporation (the “Company”).

The undersigned hereby exercises the right to acquire
                                     Common Shares of the Company in accordance
with and subject to the provisions of such Warrant Certificate and herewith
makes payment of the Exercise Price in full for the said number of Common
Shares.

The undersigned hereby confirms that an aggregate of
                                     Common Shares have been purchased as
contemplated by Section 9(a) of the Warrant Certificate.

(Please check the ONE box applicable):

 

☐    A    The undersigned holder (i) at the time of exercise of the Warrant is
not in the United States; (ii) is not a U.S. Person (iii) is not exercising the
Warrant on behalf of a U.S. Person or a person in the United States; and
(iv) did not execute or deliver this exercise form in the United States. ☐    B.
   The undersigned holder (i) purchased the Warrants for its own account or the
account of another “accredited investor” as defined in Rule 501(a) of Regulation
D under the U.S. Securities Act (“Accredited Investor”); (ii) is exercising the
Warrants solely for its own account or for the account of such other Accredited
Investor; (iii) each of it and such other person, if any, was an Accredited
Investor on the date the Warrants were acquired and is an Accredited Investor on
the date of exercise of the Warrants; and (iv) the representations and
warranties made by the holder or any beneficial purchaser, as the case may be,
to the Company in connection with the acquisition of the Warrants remain true
and correct on the date hereof. ☐    C.    The undersigned holder has delivered
to the Company an opinion of counsel (which will not be sufficient unless it is
from counsel of recognized standing and in form and substance reasonably
satisfactory to the Company) to the effect that an exemption from the
registration requirements of the U.S. Securities Act and applicable state
securities laws is available.

The Common Shares are to be issued, registered and delivered as follows:

 

Name:   

 

Address in full:   

 

  

 

Note: If further nominees are intended, please attach (and initial) a schedule
giving these particulars.

DATED this                  day of                                     ,
20        .

--------------------------------------------------------------------------------

 

  

 

  Signature Guaranteed      (Signature of Warrantholder)   (if required)      

 

     Print full name   

 

  

 

     Print full address

Note:

The undersigned holder understands that unless Box A above is checked, the
certificate representing the Common Shares issuable upon exercise of the
Warrants will bear a legend restricting transfer without registration under the
U.S. Securities Act and applicable state securities laws unless an exemption
from registration is available. Certificates representing such Common Shares
will not be registered or delivered to an address in the United States unless
Box B or Box C above is checked. If Box C is checked, any opinion tendered must
be in form and substance reasonably satisfactory to the Company. Holders
planning to deliver an opinion of counsel in connection with the exercise of the
Warrant should contact the Company in advance to determine whether any opinions
to be tendered will be acceptable to the Company.

If Box B or Box C is checked, any certificate representing the Common Shares
issued upon exercise of this Warrant will bear an applicable United States
restrictive legend.

Instructions:

The registered holder may exercise its right to receive Common Shares by
completing this form and surrendering this form and the Warrant Certificate
representing the Warrants being exercised to the Company.

The signature on this Subscription Form must correspond in every particular with
the name shown on the face of the Warrant Certificate without alteration or any
change whatsoever or this Subscription Form must be signed by a duly authorized
signing officer of the Holder. If this Subscription Form is signed by a duly
authorized signing officer of the Holder, the Warrant Certificate must be
accompanied by evidence of authority to sign.

If the Subscription Form indicates that Common Shares are to be issued to a
Person or Persons other than the registered holder of the Warrant Certificate or
an affiliate of such registered holder, the endorsement must be signature
guaranteed, in either case, by a Canadian chartered bank, or a member of a
recognized Securities Transfer Agents Medallion Program (STAMP). The stamp
affixed thereon by the guarantor must bear the actual words “Signature
Guarantee”, or “Signature Medallion Guaranteed” or in accordance with industry
standards.

The certificates will be mailed by registered mail to the Holder(s) at the
address(es) appearing in this Subscription Form.

If any Warrants represented by this certificate are not being exercised, a new
Warrant Certificate will be issued and delivered to the Holder with the Common
Share certificates in accordance with the provisions of the Warrant Certificate.

--------------------------------------------------------------------------------

SCHEDULE “B”

TRANSFER FORM

 

TO:

CANOPY GROWTH CORPORATION

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
                                         
                                                                     (include
name and address of the transferee)                                  (include
number) Warrants exercisable for common shares of Canopy Growth Corporation (the
“Company”) registered in the name of the undersigned on the register of the
Company maintained therefor, and hereby irrevocably appoints
                                                                          the
attorney of the undersigned to transfer the said securities on the books
maintained by the Company with full power of substitution.

THE UNDERSIGNED TRANSFEROR HEREBY CERTIFIES AND DECLARES that the Warrants are
not being offered, sold or transferred to, or for the account or benefit of, a
“U.S. person” (as defined in Rule 902(k) of Regulation S under the United States
Securities Act of 1933, as amended (the “U.S. Securities Act”)) or a person
within the United States unless the Warrants are registered under the U.S.
Securities Act and any applicable state securities laws or unless an exemption
from such registration is available.

DATED this                  day of                                     ,
20        .

 

 

  

 

  Signature Guaranteed      (Signature of Warrantholder)      

 

     Print full name   

 

  

 

     Print full address

Instructions:

The signature on this Transfer Form must correspond in every particular with the
name shown on the face of the Warrant Certificate without alteration or any
change whatsoever or this Subscription Form must be signed by a duly authorized
signing officer of the Holder. If this Subscription Form is signed by a duly
authorized signing officer of the Holder, the Warrant Certificate must be
accompanied by evidence of authority to sign.

The endorsement must be signature guaranteed, in either case, by a Canadian
chartered bank, or a member of a recognized Securities Transfer Agents Medallion
Program (STAMP). The stamp affixed thereon by the guarantor must bear the actual
words “Signature Guarantee”, or “Signature Medallion Guaranteed” or in
accordance with industry standards.

If any Warrants represented by this certificate are not being transferred, a new
Warrant Certificate will be issued and delivered to the Holder.

--------------------------------------------------------------------------------

Form of Tranche C Amended Warrant Certificate

(see attached)

 

Exhibit A-3

--------------------------------------------------------------------------------

TRANCHE C

COMMON SHARE PURCHASE WARRANT

THE SECURITIES REPRESENTED HEREBY AND THE SECURITIES ISSUABLE UPON EXERCISE
HEREOF HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR U.S. STATE
SECURITIES LAWS. THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE
HEREOF MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED, DIRECTLY OR
INDIRECTLY, ONLY (A) TO CANOPY GROWTH CORPORATION (THE “CORPORATION”), (B)
OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE
U.S. SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE LOCAL LAWS AND
REGULATIONS, (C) IN COMPLIANCE WITH THE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS UNDER THE U.S. SECURITIES ACT PROVIDED BY (I) RULE 144 THEREUNDER
IF AVAILABLE OR (II) RULE 144A THEREUNDER, IF AVAILABLE, AND IN EACH CASE IN
ACCORDANCE WITH APPLICABLE U.S. STATE SECURITIES LAWS, (D) IN ANOTHER
TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE U.S. SECURITIES ACT OR
ANY APPLICABLE STATE SECURITIES LAWS, OR (E) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE U.S. SECURITIES ACT, PROVIDED THAT, IN THE CASE
OF TRANSFERS PURSUANT TO (C)(I) OR (D) ABOVE, THE HOLDER HAS, PRIOR TO SUCH
TRANSFER, FURNISHED TO THE CORPORATION AN OPINION OF COUNSEL OR OTHER EVIDENCE
OF EXEMPTION, IN EITHER CASE REASONABLY SATISFACTORY TO THE CORPORATION.
DELIVERY OF THIS CERTIFICATE MAY NOT CONSTITUTE “GOOD DELIVERY” IN SETTLEMENT OF
TRANSACTIONS ON STOCK EXCHANGES IN CANADA.”

THIS WARRANT MAY NOT BE EXERCISED IN THE UNITED STATES OR BY OR ON BEHALF OF A
U.S. PERSON OR PERSON IN THE UNITED STATES UNLESS THIS WARRANT AND SHARES
ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT AND THE APPLICABLE SECURITIES LEGISLATION OF ANY SUCH STATE OR
EXEMPTIONS FROM SUCH REGISTRATION REQUIREMENTS ARE AVAILABLE. “UNITED STATES”
AND “U.S. PERSON” ARE AS DEFINED BY REGULATION S UNDER THE U.S. SECURITIES ACT.

WARRANTS TO PURCHASE COMMON SHARES OF

CANOPY GROWTH CORPORATION

 

Warrant Certificate Number:       Number of Warrants: 2018 – C-1      
12,818,148       Date:       ●, 2019

Effective as of the date hereof, this Warrant Certificate amends, re-evidences,
restates, replaces and supersedes 12,818,148 common share purchase warrants
issued by the Company to the Holder (as each such term is defined below)
pursuant to the tranche B common share purchase warrant dated November 1, 2018
(the “Original Warrant Certificate”).

--------------------------------------------------------------------------------

THIS CERTIFIES THAT, for value received, CBG Holdings LLC (the “Holder”) is
entitled, at any time prior to the Expiry Time, to purchase, at the Exercise
Price, one fully paid, validly issued and non-assessable Common Share for each
Warrant vested and exercisable under this Warrant Certificate, by surrendering
to the Company, at its principal office at 1 Hershey Drive, Smith Falls,
Ontario, K7A 0A8, this Warrant Certificate, together with a Subscription Form,
duly completed and executed, and immediately available funds by wire transfer of
lawful money of Canada payable to or to the order of the Company for an amount
equal to the Exercise Price multiplied by the number of Common Shares subscribed
for, on and subject to the terms and conditions set forth below.

Nothing contained herein shall confer any right upon the Holder to subscribe for
or purchase any Common Shares at any time after the Expiry Time, and from and
after the Expiry Time, this Warrant Certificate and all rights hereunder shall
be void and of no value.

 

1.

Defined Terms

Capitalized terms used in this Warrant Certificate, including the preamble,
shall have the following meanings:

“Adjustment Period” means the period commencing on the date hereof and ending at
the Expiry Time.

“Affiliate” means, with respect to any Person, any Person now or hereafter
existing, directly or indirectly, Controlled by, Controlling, or under common
Control with, such Person, whether on or after the date hereof.

“Business Day” means a day other than a Saturday, Sunday or other day on which
commercial banks in Smiths Falls, Ontario are authorized or required by law to
close. Any event the scheduled occurrence of which would fall on a day that is
not a Business Day shall be deferred until the next succeeding Business Day.

“Capital Reorganization” has the meaning ascribed to such term in
Section 10(a)(iv).

“Common Share” means a common share in the capital of the Company or such other
shares or other securities into which such common share is converted, exchanged,
reclassified or otherwise changed, as the case may be, from time to time.

“Company” means Canopy Growth Corporation, a corporation existing under the
federal laws of Canada, and its successors and assigns.

“Consent Agreement” means the consent agreement between the Holder and the
Company dated April 18, 2019.

“Control” means:

 

  (a)

in relation to a corporation, the direct or indirect beneficial ownership at the
relevant time of shares of such corporation carrying more than 50% of the voting
rights ordinarily exercisable at meetings of shareholders of the Company where
such voting rights are sufficient to elect a majority of the directors of the
Company;

 

  (b)

in relation to a Person that is a partnership, limited liability company or
joint venture, the direct or indirect beneficial ownership at the relevant time
of more than 50% of the ownership interests of the partnership, limited
liability company or joint venture in circumstances where it can reasonably be
expected that the Person can direct the affairs of the partnership, limited
liability company or joint venture; and

 

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  (c)

in relation to a trust, the direct or indirect beneficial ownership at the
relevant time of more than 50% of the property settled under the trust;

and the words “ Controlled by”, “Controlling” and similar words have
corresponding meanings; the Person who directly or indirectly Controls a
Controlled Person or entity shall be deemed to Control a corporation,
partnership, limited liability company, joint venture or trust which is
Controlled by the Controlled Person or entity, and so on.

“Current Market Price” means, at the relevant time of reference, the price per
share equal to the volume-weighted average trading price of the Common Shares on
the TSX for the five Trading Days immediately preceding the relevant record
date.

“Exercise Price ” means, at the time of exercise, the Current Market Price, as
may be adjusted in accordance with Section 5.

“Expiry Time” means 5:00 p.m. (Toronto time) on November 1, 2026.

“NYSE” means the New York Stock Exchange.

“Person” means an individual, corporation, partnership, unincorporated
syndicate, unincorporated organization, trust, trustee, executor, administrator,
or other legal representative, or any group or combination thereof.

“Repurchase Period” means the period commencing on April 18, 2019 and ending on
the date that is 24 months after the date that all of the Tranche A Warrants
have been exercised by the Holder.

“Rights Offering” has the meaning ascribed to such term in Section 10(a)(ii).

“Rights Period” has the meaning ascribed to such term in Section 10(a)(ii).

“Special Distribution” has the meaning ascribed to such term in
Section 10(a)(iii).

“Subscription Form” means the form of subscription annexed hereto as Schedule
“A”.

“Trading Day” means a day on which the TSX is open for business.

“Tranche A Warrants ” means the 88,472,861 Common Share purchase warrants
represented by the tranche A amended and restated warrant certificate issued by
the Company to the Holder on the date hereof.

“Tranche B Warrants” means the 38,454,444 Common Share purchase warrants
represented by the tranche B amended and restated warrant certificate issued by
the Company to the Holder on the date hereof.

“Tranche B Warrant Certificate” means the warrant certificate representing the
Tranche B Warrants.

“TSX” means the Toronto Stock Exchange.

 

-3-

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“United States” means the United States of America, its territories and
possessions, any state of the United States and the District of Columbia.

“U.S. Person” means “U.S. person” as defined in Rule 902(k) of Regulation S
under the U.S. Securities Act.

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

“Warrants” means the tranche C Common Share purchase warrants represented by
this Warrant Certificate.

 

2.

Vesting of Warrants

The Warrants represented by this Warrant Certificate shall vest and become
immediately exercisable once all Tranche A Warrants have been exercised in
accordance with their terms, and shall remain exercisable by the Holder, in
whole or in part at any time, and from time to time, thereafter and prior to the
Expiry Time.

 

3.

Exercise of Warrants

 

  (a)

Subject to Section 2, the rights represented by this Warrant Certificate may be
exercised by the Holder, in whole or in part, by the surrender of this Warrant
Certificate, with the attached Subscription Form duly executed, at the principal
office of the Company at 1 Hershey Drive, Smiths Falls, Ontario K7A 0A8 (or such
other office of the Company as it may designate by notice in writing to the
Holder at the address of such Holder appearing on the books of the Company at
any time and from time to time during the period within which the rights
represented by this Warrant Certificate may be exercised) and upon payment to or
to the order of the Company of immediately available funds by wire transfer of
lawful money of Canada in an amount equal to the Exercise Price per Common Share
multiplied by the aggregate number of Common Shares to be issued on such
exercise of this Warrant (as such amount may be adjusted in accordance with
Section 5). In the event that the Holder subscribes for and purchases any such
lesser number of Common Shares prior to the Expiry Time, the Holder shall be
entitled to receive a replacement Warrant Certificate, without charge,
representing the unexercised balance of the Warrants as soon as practicable, and
in any event within five Business Days, after the Warrants represented by this
Warrant Certificate shall have been so exercised.

 

  (b)

The Company agrees that the Common Shares so purchased shall be and be deemed to
be issued to the Holder as the registered owner of such Common Shares as of the
close of business on the date on which both this Warrant Certificate shall have
been surrendered and payment made for such Common Shares as aforesaid.
Certificates for the Common Shares so purchased shall be delivered to the Holder
as soon as practicable, and in any event within five Business Days, after the
Warrants represented by this Warrant Certificate shall have been so exercised.

 

4.

Ability to Exercise

Subject to Section 2, the Warrants may be exercised in whole or in part at any
time and from time to time prior to the Expiry Time. After the Expiry Time, all
rights under any outstanding Warrants evidenced hereby, in respect of which the
rights of subscription and purchase herein provided for shall not have been
exercised, shall wholly cease and terminate and such Warrants shall be void and
of no value or effect.

 

-4-

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5.

Exercise Price Credit

If, for any reason, the Company has not within the Repurchase Period, purchased
for cancellation Common Shares required to be purchased pursuant to section 2.3
of the Consent Agreement, the Company hereby agrees and acknowledges that the
Holder will be credited an amount (the “Credit Amount”) that will reduce the
aggregate exercise price otherwise payable by the Holder upon each exercise of
the Warrants represented by this Warrant Certificate equal to the difference
between:

 

  (a)

$1,582,995,262; and

 

  (b)

the actual purchase price paid by the Company in purchasing Common Shares
pursuant to section 2.3 of the Consent Agreement.

 

6.

No Fractional Common Shares

No fractional Common Shares will be issuable upon any exercise of the Warrants
and the Holder will not be entitled to any cash payment or compensation in lieu
of a fractional Common Share.

 

7.

Not a Shareholder

The holding of the Warrants shall not constitute the Holder a shareholder of the
Company nor entitle the Holder to any right or interest in respect thereof,
except as expressly provided in this Warrant Certificate.

 

8.

Covenants and Representations of the Company The Company covenants and agrees as
follows:

 

  (a)

this Warrant Certificate is a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms;

 

  (b)

all Common Shares which may be issued upon the exercise of the rights
represented by the Warrants will, upon issuance, be validly issued, fully paid
and non-assessable, free from all taxes, liens and charges with respect to the
issue thereof, except with respect to any applicable withholding taxes; and

 

  (c)

during the period within which the rights represented by this Warrant
Certificate may be exercised, the Company will at all times have authorized and
reserved a sufficient number of its Common Shares to provide for the exercise of
the rights represented by this Warrant Certificate.

 

9.

Covenant of the Holder

 

  (a)

The Holder covenants and agrees that in respect of each Common Share purchased
by the Holder or any affiliate of the Holder, including Greenstar Canada
Investment Limited Partnership and Constellation Brands, Inc. and its
Subsidiaries (as defined in National Instrument 45-106 – Prospectus Exemptions),
(i) on the TSX, the NYSE or any other stock exchange, marketplace or trading
market on which the Common Shares are then listed; or (ii) through private
agreement transactions with existing holders of Common Shares, the number of
Warrants represented by this Warrant Certificate shall be reduced by the number
of Common Shares so acquired (up to an aggregate maximum reduction of 12,818,148
Common Shares less the number of Common Shares, if any, by which the Tranche B
Warrants have been reduced pursuant to section 9(a) of the Tranche B Warrant
Certificate).

 

-5-

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  (b)

At the time of exercise of the Warrants, the Holder shall confirm the number of
Common Shares purchased as contemplated by Section 9(a).

 

  (c)

For certainty, the aggregate reduction in the number of Warrants represented by
this Warrant Certificate pursuant to Section 9(a) hereof and in the number of
Tranche B Warrants represented by the Tranche B Warrant Certificate pursuant to
section 9(a) thereof shall not exceed 20,000,000 Warrants.

 

  (d)

The Holder shall have the right, but not the obligation, to surrender this
Warrant Certificate at the principal office of the Company at 1 Hershey Drive,
Smiths Falls, Ontario K7A 0A8 (or such other office of the Company as it may
designate by notice in writing to the Holder at the address of such Holder
appearing on the books of the Company at any time and from time to time during
the period within which the rights represented by this Warrant Certificate may
be exercised) and, if the Holder exercises such right, the Holder shall
thereafter be entitled to receive a replacement Warrant Certificate, without
charge, representing the reduced balance of the Warrants as soon as practicable,
and in any event within five Business Days, after the Warrants represented by
this Warrant Certificate shall have been so surrendered and cancelled. If the
Holder does not exercise such right, this Warrant Certificate shall continue to
evidence in full the Warrants and the number of Warrants indicated on the cover
page of this Warrant Certificate shall be deemed to be reduced by the number of
Warrants contemplated by Section 9(a) hereof.

 

10.

Anti-Dilution Protection

 

  (a)

The Exercise Price and the number of Common Shares issuable to the Holder upon
the exercise of the Warrants shall be subject to adjustment from time to time in
the events and in the manner provided as follows:

 

  (i)

If at any time during the Adjustment Period the Company shall:

 

  (A)

fix a record date for the issue of, or issue, Common Shares to the holders of
all or substantially all of the outstanding Common Shares by way of a share
dividend;

 

  (B)

fix a record date for the distribution to, or make a distribution to, the
holders of all or substantially all of the outstanding Common Shares payable in
Common Shares or securities exchangeable for or convertible into Common Shares;

 

  (C)

subdivide the outstanding Common Shares into a greater number of Common Shares;
or

 

  (D)

consolidate the outstanding Common Shares into a smaller number of Common
Shares,

(any of such events in subsections (A), (B), (C) and (D) above being called a
“Common Share Reorganization”), the Exercise Price shall be adjusted on the
earlier of the record date on which holders of Common Shares are determined for
the purposes of the Common Share Reorganization and the effective date of the
Common Share Reorganization to the amount determined by multiplying the Exercise
Price in effect immediately prior to such record date or effective date, as the
case may be, by a fraction:

 

-6-

--------------------------------------------------------------------------------

  (A)

the numerator of which shall be the number of Common Shares outstanding on such
record date or effective date, as the case may be, before giving effect to such
Common Share Reorganization; and

 

  (B)

the denominator of which shall be the number of Common Shares which will be
outstanding immediately after giving effect to such Common Share Reorganization
(including, in the case of a distribution of securities exchangeable for or
convertible into Common Shares, the number of Common Shares that would have been
outstanding had such securities been exchanged for or converted into Common
Shares on such record date or effective date, as the case may be).

To the extent that any adjustment in the Exercise Price occurs pursuant to this
Section 10(a)(i) as a result of the fixing by the Company of a record date for
the distribution of securities exchangeable for or convertible into Common
Shares, the Exercise Price shall be readjusted immediately after the expiry of
any relevant exchange or conversion right to the Exercise Price which would then
be in effect based upon the number of Common Shares actually issued and
remaining issuable after such expiry and shall be further readjusted in such
manner upon the expiry of any further such right.

 

  (ii)

If at any time during the Adjustment Period the Company shall fix a record date
for the issue or distribution to the holders of all or substantially all of the
outstanding Common Shares of rights, options or warrants pursuant to which such
holders are entitled, during a period expiring not more than 45 days after the
record date for such issue (such period being the “Rights Period”), to subscribe
for or purchase Common Shares or securities exchangeable for or convertible into
Common Shares at a price per share to the holder (or in the case of securities
exchangeable for or convertible into Common Shares, at an exchange or conversion
price per share) at the date of issue of such securities of less than the
Current Market Price of the Common Shares on such record date (any of such
events being called a “Rights Offering”), the Exercise Price shall be adjusted
effective immediately after the record date for such Rights Offering to the
amount determined by multiplying the Exercise Price in effect on such record
date by a fraction:

 

  (A)

the numerator of which shall be the aggregate of:

 

  (1)

the number of Common Shares outstanding on the record date for the Rights
Offering, and

 

  (2)

the quotient determined by dividing

 

  I.

either (a) the product of the number of Common Shares offered during the Rights
Period pursuant to the Rights Offering and the price at which such Common Shares
are offered, or (b) the product of the exchange or conversion price of the
securities so offered and the number of Common Shares for or into which the
securities offered pursuant to the Rights Offering may be exchanged or
converted, as the case may be, by

 

-7-

--------------------------------------------------------------------------------

  II.

the Current Market Price of the Common Shares as of the record date for the
Rights Offering; and

 

  (B)

the denominator of which shall be the aggregate of the number of Common Shares
outstanding on such record date and the number of Common Shares offered pursuant
to the Rights Offering (including in the case of the issue or distribution of
securities exchangeable for or convertible into Common Shares the number of
Common Shares for or into which such securities may be exchanged or converted).

If by the terms of the rights, options, or warrants referred to in this
Section 10(a)(ii), there is more than one purchase, conversion or exchange price
per Common Share, the aggregate price of the total number of additional Common
Shares offered for subscription or purchase, or the aggregate conversion or
exchange price of the convertible or exchangeable securities so offered, shall
be calculated for purposes of the adjustment on the basis of the lowest
purchase, conversion or exchange price per Common Share, as the case may be. Any
Common Shares owned by or held for the account of the Company shall be deemed
not to be outstanding for the purpose of any such calculation. To the extent
that any adjustment in the Exercise Price occurs pursuant to this
Section 10(a)(ii) as a result of the fixing by the Company of a record date for
the issue or distribution of rights, options or warrants referred to in this
Section 10(a)(ii), the Exercise Price shall be readjusted immediately after the
expiry of any relevant exchange, conversion or exercise right to the Exercise
Price which would then be in effect based upon the number of Common Shares
actually issued and remaining issuable after such expiry and shall be further
readjusted in such manner upon the expiry of any further such right.

 

  (iii)

If at any time during the Adjustment Period the Company shall fix a record date
for the issue or distribution to the holders of all or substantially all of the
outstanding Common Shares of:

 

  (A)

shares of the Company of any class other than Common Shares;

 

  (B)

rights, options or warrants to acquire Common Shares or securities exchangeable
for or convertible into Common Shares (other than rights, options or warrants
pursuant to which holders of Common Shares are entitled, during a period
expiring not more than 45 days after the record date for such issue, to
subscribe for or purchase Common Shares or securities exchangeable for or
convertible into Common Shares at a price per share (or in the case of
securities exchangeable for or convertible into Common Shares at an exchange or
conversion price per share) at the date of issue of such securities to the
holder of at least the Current Market Price of the Common Shares on such record
date);

 

  (C)

evidences of indebtedness of the Company; or

 

  (D)

any property or assets of the Company;

 

-8-

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and if such issue or distribution does not constitute a Common Share
Reorganization or a Rights Offering (any of such non-excluded events being
called a “Special Distribution”), the Exercise Price shall be adjusted effective
immediately after the record date for the Special Distribution to the amount
determined by multiplying the Exercise Price in effect on the record date for
the Special Distribution by a fraction:

 

  (1)

the numerator of which shall be the difference between:

 

  I.

the product of the number of Common Shares outstanding on such record date and
the Current Market Price of the Common Shares on such record date, and

 

  II.

the fair value, as determined in good faith by the directors of the Company, to
the holders of Common Shares of the shares, rights, options, warrants, evidences
of indebtedness or property or assets to be issued or distributed in the Special
Distribution; and

 

  (2)

the denominator of which shall be the product obtained by multiplying the number
of Common Shares outstanding on such record date by the Current Market Price of
the Common Shares on such record date.

Any Common Shares owned by or held for the account of the Company shall be
deemed not to be outstanding for the purpose of such calculation. To the extent
that any adjustment in the Exercise Price occurs pursuant to this
Section 10(a)(iii) as a result of the fixing by the Company of a record date for
the issue or distribution of rights, options or warrants to acquire Common
Shares or securities exchangeable for or convertible into Common Shares referred
to in this Section 10(a)(iii), the Exercise Price shall be readjusted
immediately after the expiry of any relevant exercise, exchange or conversion
right to the amount which would then be in effect based upon the number of
Common Shares issued and remaining issuable after such expiry and shall be
further readjusted in such manner upon the expiry of any further such right.

 

  (iv)

If at any time during the Adjustment Period there shall occur:

 

  (A)

a reclassification or redesignation of the Common Shares, any change of the
Common Shares into other shares or securities or any other capital
reorganization involving the Common Shares other than a Common Share
Reorganization;

 

  (B)

a consolidation, amalgamation, arrangement or merger of the Company with or into
another body corporate which results in a reclassification or redesignation of
the Common Shares or a change of the Common Shares into other shares or
securities;

 

  (C)

the transfer of the undertaking or assets of the Company as an entirety or
substantially as an entirety to another company or entity;

 

-9-

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  (any of such events being called a “Capital Reorganization”), after the
effective date of the Capital Reorganization the Holder shall be entitled to
receive, and shall accept, for the same aggregate consideration, upon exercise
of the Warrants, in lieu of the number of Common Shares to which the Holder was
theretofore entitled upon the exercise of the Warrants, the kind and aggregate
number of shares and other securities or property resulting from the Capital
Reorganization which the Holder would have been entitled to receive as a result
of the Capital Reorganization if, on the effective date thereof, the Holder had
been the registered holder of the number of Common Shares which the Holder was
theretofore entitled to purchase or receive upon the exercise of the Warrants.
If necessary, as a result of any such Capital Reorganization, appropriate
adjustments shall be made in the application of the provisions of this Warrant
Certificate with respect to the rights and interests thereafter of the Holder to
the end that the provisions shall thereafter correspondingly be made applicable
as nearly as may reasonably be possible in relation to any shares or other
securities or property thereafter deliverable upon the exercise of the Warrants.

 

  (v)

If at any time during the Adjustment Period any adjustment or readjustment in
the Exercise Price shall occur pursuant to the provisions of Sections 10(a)(i)
or 10(a)(iii) of this Warrant Certificate, then the number of Common Shares
purchasable upon the subsequent exercise of the Warrants shall be simultaneously
adjusted or readjusted, as the case may be, by multiplying the number of Common
Shares purchasable upon the exercise of the Warrants immediately prior to such
adjustment or readjustment by a fraction which shall be the reciprocal of the
fraction used in the adjustment or readjustment of the Exercise Price.

 

  (b)

The following rules and procedures shall be applicable to adjustments made
pursuant to Section 10(a) of this Warrant Certificate:

 

  (i)

subject to the following sections of this Section 10(b), any adjustment made
pursuant to Section 10(a) of this Warrant Certificate shall be made successively
whenever an event referred to therein shall occur;

 

  (ii)

no adjustment in the Exercise Price shall be required unless such adjustment
would result in a change of at least one percent in the then Exercise Price and
no adjustment shall be made in the number of Common Shares purchasable or
issuable on the exercise of the Warrants unless it would result in a change of
at least one one-hundredth of a Common Share; provided, however, that any
adjustments which except for the provision of this Section 10(b)(ii) would
otherwise have been required to be made shall be carried forward and taken into
account in any subsequent adjustment. Notwithstanding any other provision of
Section 10(a) of this Warrant Certificate, no adjustment of the Exercise Price
shall be made which would result in an increase in the Exercise Price or a
decrease in the number of Common Shares issuable upon the exercise of the
Warrants (except in respect of a consolidation of the outstanding Common
Shares);

 

-10-

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  (iii)

if at any time during the Adjustment Period the Company shall take any action
affecting the Common Shares, other than an action or event described in
Section 10(a) of this Warrant Certificate, which in the opinion of the directors
of the Company would have an adverse effect upon the rights of the Holder, the
Exercise Price and/or the number of Common Shares purchasable under the Warrants
shall, subject to any necessary regulatory approval, be adjusted in such manner
and at such time as the directors of the Company may determine to be equitable
in the circumstances, provided that no such action shall be taken unless and
until the Holder has been provided with notice of such proposed action and the
consequences thereof;

 

  (iv)

if the Company sets a record date to determine holders of Common Shares for the
purpose of entitling such holders to receive any dividend or distribution or any
subscription or purchase rights and shall thereafter and before the distribution
to such holders of any such dividend, distribution or subscription or purchase
rights legally abandon its plan to pay or deliver such dividend, distribution or
subscription or purchase rights, then no adjustment in the Exercise Price or the
number of Common Shares purchasable under the Warrants shall be required by
reason of the setting of such record date;

 

  (v)

no adjustment in the Exercise Price or in the number or kind of securities
purchasable on the exercise of the Warrants shall be made in respect of any
event described in Section 10 of this Warrant Certificate if (subject to TSX and
NYSE approval) the Holder is entitled to participate in such event on the same
terms mutatis mutandis as if the Holder had exercised the Warrants prior to or
on the record date or effective date, as the case may be, of such event. Any
such participation by the Holder is subject to regulatory approval; and

 

  (vi)

in any case in which this Warrant Certificate shall require that an adjustment
shall become effective immediately after a record date for an event referred to
in Section 10(a) hereof, the Company may defer, until the occurrence of such
event:

 

  (A)

issuing to the Holder, to the extent that the Warrants are exercised after such
record date and before the occurrence of such event, the additional Common
Shares issuable upon such exercise by reason of the adjustment required by such
event; and

 

  (B)

delivering to the Holder any distribution declared with respect to such
additional Common Shares after such record date and before such event;

provided, however, that the Company shall deliver to the Holder an appropriate
instrument evidencing the right of the Holder upon the occurrence of the event
requiring the adjustment, to an adjustment in the Exercise Price or the number
of Common Shares purchasable upon the exercise of the Warrants and to such
distribution declared with respect to any such additional Common Shares issuable
on the exercise of the Warrants.

 

  (c)

At least 10 days prior to the earlier of the record date or effective date of
any event which requires or might require an adjustment in any of the rights of
the Holder under this Warrant Certificate, including the Exercise Price or the
number of Common Shares which may be purchased under this Warrant Certificate,
the Company shall deliver to the Holder a certificate of the Company specifying
the particulars of such event and, if determinable, the required adjustment and
the calculation of such adjustment. In case any adjustment for which a notice in
this Section 10(c) has been given is not then determinable, the Company shall
promptly after such adjustment is determinable deliver to the Holder a
certificate providing the calculation of such adjustment. The Company hereby
covenants and agrees that the Company will not take any action which might
deprive the Holder of the opportunity of exercising the rights of subscription
contained in this Warrant Certificate, during such 10 day period.

 

- 11 -

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  (d)

In connection with any: (i) reclassification or redesignation of the Common
Shares, any change of the Common Shares into other shares or securities or any
other capital reorganization involving the Common Shares other than as set forth
in this Section 10; (ii) consolidation, amalgamation, arrangement or merger of
the Company with or into another body corporate which results in a
reclassification or redesignation of the Common Shares or a change of the Common
Shares into other shares or securities (including, without limitation, pursuant
to a “take-over bid”, “tender offer” or other acquisition of all or
substantially all of the outstanding Common Shares); or (iii) sale, transfer or
lease to another corporation of all or substantially all the property or assets
of the Company, the Holder shall have the right thereafter, upon payment of the
Exercise Price in effect immediately prior to such action, to purchase upon
exercise of each Warrant the kind and amount of shares and other securities and
property which it would have owned or have been entitled to receive after the
happening of such reclassification, redesignation, consolidation, amalgamation,
arrangement, merger, sale, transfer or lease had such Warrant been exercised
immediately prior to such action, and the Holder shall be bound to accept such
shares and other securities and property in lieu of the Common Shares to which
it was previously entitled; provided, however, that no adjustment in respect of
dividends, interest or other income on or from such shares or other securities
and property shall be made during the term of a Warrant or upon the exercise of
a Warrant. If necessary, as a result of any actions contemplated by this
paragraph, appropriate adjustments shall be made in the application of the
provisions of this Warrant Certificate with respect to the rights and interests
thereafter of the Holder to the end that the provisions shall thereafter
correspondingly be made applicable as nearly as may reasonably be possible in
relation to any shares or other securities or property thereafter deliverable
upon the exercise of the Warrants. The provisions of this paragraph shall
similarly apply to successive consolidations, mergers, amalgamation, sales,
transfers or leases.

 

11.

U.S. Registration

This Warrant and the Common Shares issuable upon exercise of this Warrant have
not been and will not be registered under the U.S. Securities Act or under state
securities laws of any state in the United States. Accordingly, this Warrant may
not be transferred or exercised in the United States or by or on behalf of a
U.S. Person or a person in the United States unless an exemption is available
from the registration requirements of the U.S. Securities Act and applicable
state securities laws and, if required by the Company, the holder of this
Warrant has furnished an opinion of counsel of recognized standing in form and
substance reasonably satisfactory to the Company to such effect, as applicable.

 

12.

Authorized Shares

As a condition precedent to the taking of any action which would require an
adjustment pursuant to Section 10 of this Warrant Certificate, the Company shall
take any action which may be necessary in order that the Company has issued and
reserved in its authorized capital, and may validly and legally issue as fully
paid and non-assessable, all of the Common Shares (or other shares and
securities, if applicable) which the Holder of the Warrants is entitled to
receive on the exercise hereof.

 

-12-

--------------------------------------------------------------------------------

13.

Mutilated or Missing Warrant Certificate

Upon receipt of evidence satisfactory to the Company of the loss, theft,
destruction or mutilation of this Warrant Certificate and, in the case of any
such loss, theft or destruction, upon delivery of a bond or indemnity
satisfactory to the Company, or, in the case of any such mutilation, upon
surrender or cancellation of this Warrant Certificate, the Company will issue to
the Holder a new warrant certificate of like tenor, in lieu of this Warrant
Certificate, representing the right to subscribe for and purchase the number of
Common Shares which may be subscribed for and purchased hereunder.

 

14.

Merger and Successors

 

  (a)

Nothing herein contained shall prevent any consolidation, amalgamation or merger
of the Company with or into any other Person or Persons, or a conveyance or
transfer of all or substantially all of the properties and estates of the
Company as an entirety to any Person lawfully entitled to acquire and operate
same, provided, however, that the Person formed by such consolidation,
amalgamation, arrangement or merger or which acquires by conveyance or transfer
all or substantially all of the properties and estates of the Company as an
entirety shall, simultaneously with such amalgamation, arrangement, merger,
conveyance or transfer, assume the due and punctual performance and observance
of all the covenants and conditions hereof to be performed or observed by the
Company.

 

  (b)

In case the Company, pursuant to Section 14(a), shall be consolidated,
amalgamated or merged with or into any other Person or Persons or shall convey
or transfer all or substantially all of its properties and estates as an
entirety to any other Person, the successor Person formed by such consolidation,
amalgamation or arrangement, or into which the Company shall have been
consolidated, amalgamated or merged or which shall have received a conveyance or
transfer as aforesaid, shall succeed to and be substituted for the Company
hereunder and such changes in phraseology and form (but not in substance) may be
made in this Warrant Certificate as may be appropriate in view of such
amalgamation, arrangement, merger or transfer.

 

15.

Amendment

This Warrant Certificate may only be amended with the prior written consent of
the Company and the Holder.

 

16.

Severability

If any term or other provision of this Warrant Certificate is invalid, illegal
or incapable of being enforced under any applicable law or as a matter of public
policy, all other conditions and provisions of this Warrant Certificate shall
nevertheless remain in full force and effect. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
Company and the Holder shall negotiate in good faith to modify this Warrant
Certificate so as to effect the original intent of the Company and the Holder as
closely as possible in a mutually acceptable manner in order that the provisions
of this Warrant Certificate be consummated as originally contemplated to the
greatest extent possible.

 

17.

Governing Law

This Warrant Certificate shall be governed by and construed and interpreted in
accordance with the laws of the Province of Ontario and the federal laws of
Canada applicable therein irrespective of the choice of laws principles.

 

-13-

--------------------------------------------------------------------------------

18.

Transferability

Subject only to applicable securities laws, the Warrants represented by this
Warrant Certificate are transferable by the Holder to any of its Affiliates and
the term “Holder” shall mean and include any successor, transferee or assignee
of the current or any future Holder. The Warrants represented by this Warrant
Certificate may be transferred by the Holder completing and delivering to the
Company the transfer form attached hereto as Schedule “B”. For greater
certainty, the Warrants represented by this Warrant Certificate are not
transferrable except as described in this Section 18 or with the prior written
consent of the Company.

 

19.

Enurement

This Warrant Certificate and all of its provisions shall enure to the benefit of
the Holder and its permitted assigns and successors and shall be binding upon
the Company and its successors and permitted assigns.

 

20.

Notice

All notices, requests, claims, demands and other communications under this
Warrant Certificate shall be in writing and shall be given or made (and shall be
deemed to have been duly given or made upon receipt) by delivery in person, by
overnight courier service or by registered or certified mail (postage prepaid,
return receipt requested) to the Holder and the Company at the following
addresses (or at such other address as shall be specified in a notice given in
accordance with this Section 20):

 

  (a)

if to the Holder at:

c/o Constellation Brands, Inc.

207 High Point Drive, Bldg. 100

Victor, New York 14564

Attention: General Counsel

and with a copy (which shall not constitute notice) to:

Osler, Hoskin & Harcourt LLP

100 King Street West, Suite 6200

Toronto, Ontario M5X 1B8

Attention: Emmanuel Pressman and James R. Brown

 

  (b)

if to the Company at:

1 Hershey Drive,

Smiths Falls, ON K7A 0A8

Attention: Chief Executive Officer

with a copy (which shall not constitute notice) to:

Cassels Brock & Blackwell LLP

40 King Street West, Suite 2100

Toronto, Ontario M5H 3C2

Attention: Jonathan Sherman

 

-14-

--------------------------------------------------------------------------------

21.

Further Assurances

The Company shall promptly do, make, execute, deliver, or cause to be done,
made, executed or delivered, all such further acts, documents and things as the
Holder may reasonably require from time to time for the purpose of giving effect
to this Warrant Certificate and shall use reasonable efforts and take all such
steps as may be reasonably within its power to implement to their full extent
the provisions of this Warrant Certificate.

 

22.

Currency

All dollar amounts referred to in this Warrant Certificate are in Canadian
dollars.

[Signature page follows]

 

-15-

--------------------------------------------------------------------------------

IN WITNESS WHEREOF the Company has caused this Warrant Certificate to be
executed by a duly authorized signatory effective as of the date first written
above.

 

CANOPY GROWTH CORPORATION By:       Name:   Title:

ACKNOWLEDGEMENT

IN WITNESS WHEREOF, the Holder hereby acknowledges, confirms and consents to the
amendment and restatement of the Original Warrant Certificate as set out in this
Amended and Restated Warrant Certificate.

 

CBG HOLDINGS LLC By:       Name:   Title:

--------------------------------------------------------------------------------

SCHEDULE “A”

SUBSCRIPTION FORM

TO:    CANOPY GROWTH CORPORATION

Terms which are not otherwise defined herein shall have the meanings ascribed to
such terms in the Warrant Certificate held by the undersigned and issued by
Canopy Growth Corporation (the “Company”).

The undersigned hereby exercises the right to acquire                         
Common Shares of the Company in accordance with and subject to the provisions of
such Warrant Certificate and herewith makes payment of the Exercise Price in
full for the said number of Common Shares.

The undersigned hereby confirms that an aggregate of                         
Common Shares have been purchased as contemplated by Section 9(a) of the Warrant
Certificate.

(Please check the ONE box applicable):

 

  A

The undersigned holder (i) at the time of exercise of the Warrant is not in the
United States; (ii) is not a U.S. Person (iii) is not exercising the Warrant on
behalf of a U.S. Person or a person in the United States; and (iv) did not
execute or deliver this exercise form in the United States.

 

  B.

The undersigned holder (i) purchased the Warrants for its own account or the
account of another “accredited investor” as defined in Rule 501(a) of Regulation
D under the U.S. Securities Act (“Accredited Investor”); (ii) is exercising the
Warrants solely for its own account or for the account of such other Accredited
Investor; (iii) each of it and such other person, if any, was an Accredited
Investor on the date the Warrants were acquired and is an Accredited Investor on
the date of exercise of the Warrants; and (iv) the representations and
warranties made by the holder or any beneficial purchaser, as the case may be,
to the Company in connection with the acquisition of the Warrants remain true
and correct on the date hereof.

 

  C.

The undersigned holder has delivered to the Company an opinion of counsel (which
will not be sufficient unless it is from counsel of recognized standing and in
form and substance reasonably satisfactory to the Company) to the effect that an
exemption from the registration requirements of the U.S. Securities Act and
applicable state securities laws is available.

The Common Shares are to be issued, registered and delivered as follows:

 

Name:   

 

Address in full:   

 

  

 

Note: If further nominees are intended, please attach (and initial) a schedule
giving these particulars.

DATED this                  day of                                 , 20        .

--------------------------------------------------------------------------------

 

    

 

Signature Guaranteed      (Signature of Warrantholder) (if required)           
  

 

     Print full name     

 

    

 

     Print full address

Note:

The undersigned holder understands that unless Box A above is checked, the
certificate representing the Common Shares issuable upon exercise of the
Warrants will bear a legend restricting transfer without registration under the
U.S. Securities Act and applicable state securities laws unless an exemption
from registration is available. Certificates representing such Common Shares
will not be registered or delivered to an address in the United States unless
Box B or Box C above is checked. If Box C is checked, any opinion tendered must
be in form and substance reasonably satisfactory to the Company. Holders
planning to deliver an opinion of counsel in connection with the exercise of the
Warrant should contact the Company in advance to determine whether any opinions
to be tendered will be acceptable to the Company.

If Box B or Box C is checked, any certificate representing the Common Shares
issued upon exercise of this Warrant will bear an applicable United States
restrictive legend.

Instructions:

The registered holder may exercise its right to receive Common Shares by
completing this form and surrendering this form and the Warrant Certificate
representing the Warrants being exercised to the Company.

The signature on this Subscription Form must correspond in every particular with
the name shown on the face of the Warrant Certificate without alteration or any
change whatsoever or this Subscription Form must be signed by a duly authorized
signing officer of the Holder. If this Subscription Form is signed by a duly
authorized signing officer of the Holder, the Warrant Certificate must be
accompanied by evidence of authority to sign.

If the Subscription Form indicates that Common Shares are to be issued to a
Person or Persons other than the registered holder of the Warrant Certificate or
an affiliate of such registered holder, the endorsement must be signature
guaranteed, in either case, by a Canadian chartered bank, or a member of a
recognized Securities Transfer Agents Medallion Program (STAMP). The stamp
affixed thereon by the guarantor must bear the actual words “Signature
Guarantee”, or “Signature Medallion Guaranteed” or in accordance with industry
standards.

The certificates will be mailed by registered mail to the Holder(s) at the
address(es) appearing in this Subscription Form.

If any Warrants represented by this certificate are not being exercised, a new
Warrant Certificate will be issued and delivered to the Holder with the Common
Share certificates in accordance with the provisions of the Warrant Certificate.

--------------------------------------------------------------------------------

SCHEDULE “B”

TRANSFER FORM

 

TO:

CANOPY GROWTH CORPORATION

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
(include name and address of the transferee)                                 
(include number) Warrants exercisable for common shares of Canopy Growth
Corporation (the “Company”) registered in the name of the undersigned on the
register of the Company maintained therefor, and hereby irrevocably appoints
                                         
                                        the attorney of the undersigned to
transfer the said securities on the books maintained by the Company with full
power of substitution.

THE UNDERSIGNED TRANSFEROR HEREBY CERTIFIES AND DECLARES that the Warrants are
not being offered, sold or transferred to, or for the account or benefit of, a
“U.S. person” (as defined in Rule 902(k) of Regulation S under the United States
Securities Act of 1933, as amended (the “U.S. Securities Act”)) or a person
within the United States unless the Warrants are registered under the U.S.
Securities Act and any applicable state securities laws or unless an exemption
from such registration is available.

DATED this                  day of                                 , 20        .

 

  

 

Signature Guaranteed    (Signature of Warrantholder)   

 

   Print full name   

 

  

 

   Print full address

Instructions:

The signature on this Transfer Form must correspond in every particular with the
name shown on the face of the Warrant Certificate without alteration or any
change whatsoever or this Subscription Form must be signed by a duly authorized
signing officer of the Holder. If this Subscription Form is signed by a duly
authorized signing officer of the Holder, the Warrant Certificate must be
accompanied by evidence of authority to sign.

The endorsement must be signature guaranteed, in either case, by a Canadian
chartered bank, or a member of a recognized Securities Transfer Agents Medallion
Program (STAMP). The stamp affixed thereon by the guarantor must bear the actual
words “Signature Guarantee”, or “Signature Medallion Guaranteed” or in
accordance with industry standards.

If any Warrants represented by this certificate are not being transferred, a new
Warrant Certificate will be issued and delivered to the Holder.

--------------------------------------------------------------------------------

EXHIBIT B

FORM OF APPROVAL RESOLUTION

BE IT RESOLVED AS AN ORDINARY RESOLUTION THAT:

 

(1)

Canopy Growth Corporation (the “Company”) is hereby authorized to issue such
number of common shares in the capital of the Company (the “Common Shares”) as
is necessary to allow the Company to acquire 100% of the issued and outstanding
subordinate voting shares, assuming conversion of the issued and outstanding
proportionate voting shares and multiple voting shares of Acreage Holdings, Inc.
(“Acreage”) pursuant to a plan of arrangement (the “Arrangement”) in accordance
with an arrangement agreement between the Company and Acreage (the “Arrangement
Agreement”), as more particularly described in the management information
circular of the Company (the “Company Circular”) (as the Arrangement may be, or
may have been, modified or amended in accordance with its terms), including, but
not limited to, the issuance of Common Shares upon the exercise of convertible
securities of Acreage and the issuance of Common Shares for any other matters
contemplated by or related to the Arrangement;

 

(2)

the Company is hereby authorized to issue up to such number of Common Shares to
CBG Holdings LLC (“CBG”) and/or Greenstar Canada Investment Limited Partnership
(“GCILP”) as is necessary to satisfy the top-up right held by CBG and GCILP
pursuant to the terms of the second amended and restated investor rights
agreement dated as of April 18, 2019 between CBG, GCILP and the Company, as more
particularly described in the Company Circular;

 

(3)

the Company is hereby authorized to amend the terms of the 88,472,861 issued and
outstanding Tranche A warrants and the 51,272,592 issued and outstanding Tranche
B warrants of the Company held by CBG, collectively exercisable to acquire up to
an aggregate of 139,745,453 Common Shares, in accordance with the terms and
conditions of the certificates evidencing such warrants and pursuant to the
terms and conditions of the consent agreement dated as of April 18, 2019 between
CBG and the Company, as more particularly described in the Company Circular; and

 

(4)

notwithstanding that this resolution has been duly passed by the holders of the
common shares of the Company, the directors of the Company are hereby authorized
and empowered, if they decide not to proceed with the aforementioned resolution,
to revoke this resolution at any time prior to the closing date of the
Arrangement, without further notice to or approval of the shareholders of the
Company;

 

(5)

any one or more directors or officers of the Company is hereby authorized, for
and on behalf and in the name of the Company, to execute and deliver, whether
under corporate seal of the Company or otherwise, all such agreements, forms,
waivers, notices, certificates, confirmations and other documents and
instruments, and to do or cause to be done all such other acts and things, as in
the opinion of such director or officer may be necessary, desirable or useful
for the purpose of giving effect to the foregoing resolutions and the matters
authorized thereby, such determination to be conclusively evidenced by the
execution and delivery of such document, agreement or instrument or the doing of
any such act or thing.

--------------------------------------------------------------------------------

EXHIBIT C

FORM OF VOTING SUPPORT AGREEMENT

(see attached)

--------------------------------------------------------------------------------

SUPPORT AGREEMENT

April ●, 2019

To the Undersigned Securityholder of Canopy Growth Corporation:

Reference is made to the Consent Agreement (the “Consent Agreement”) dated as of
the date of this letter agreement between CBG Holdings LLC (“CBG”) and Canopy
Growth Corporation (“Canopy”) and to the Arrangement Agreement dated as of the
date of this letter agreement between Canopy and Acreage Holdings Inc. Unless
otherwise defined herein, all capitalized terms referred to herein shall have
the meanings attributed thereto in the Consent Agreement.

We understand that you (the “Locked-Up Securityholder”) beneficially own, or
exercise control or direction over, directly or indirectly, the number of Canopy
Shares (as defined below) set forth in Schedule A attached hereto.

The Locked-Up Securityholder agrees to vote in favour of the Approval Resolution
(and in favour of any actions required in furtherance of the actions
contemplated thereby) at any meeting of the securityholders of Canopy, however
called, for the purpose of approving the Approval Resolution (the “Meeting”):
(i) all of the Common Shares beneficially owned by the Locked-Up Securityholder,
or over which the Locked-Up Securityholder exercises direction and control,
directly or indirectly, in his or her personal capacity (the “Canopy Shares”),
which are set forth and described in Schedule A attached hereto and forming part
hereof and (ii) any and all other Common Shares hereafter acquired or controlled
by the Locked-Up Securityholder in his or her personal capacity either directly
or indirectly before the record date in respect of the Meeting including, for
the avoidance of doubt, all Common Shares issued upon the exercise or surrender
of the outstanding securities convertible into, or exchangeable for, Common
Shares; ((i) and (ii) are collectively referred to as the “Locked- Up
Securityholder’s Canopy Securities”), and to otherwise support the transactions
contemplated by the Consent Agreement (the “Transactions”), subject to the terms
and conditions of this letter agreement.

 

1.

Covenants of the Locked-Up Securityholder

For good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, and subject to the terms and conditions hereof, from the
date hereof until the termination of this letter agreement in accordance with
Section 3, the Locked-Up Securityholder hereby covenants and agrees as follows:

 

  (a)

to vote (or cause to be voted), all of the Locked-Up Securityholder’s Canopy
Securities in favour of the Approval Resolution and any actions required in
furtherance of the actions contemplated thereby at the Meeting;

 

  (b)

to vote (or to cause to be voted), all of the Locked-Up Securityholder’s Canopy
Securities at any meeting of securityholders of Canopy against any resolution or
transaction which would in any manner, frustrate, prevent, impede, delay or
nullify any of the Transactions, which for greater certainty shall not preclude
the Locked-Up Securityholder from voting in its sole discretion in relation to
matters undertaken at the Meeting or any subsequent Canopy annual, special or
annual and special meeting that do not affect the Transactions;

 

  (c)

not to grant or agree to grant any proxy or other right to vote any of the
Locked-Up Securityholder’s Canopy Securities (other than as permitted under
subsections 1(a) and 1(b) hereof), or enter into any voting trust, vote pooling
or other agreement with respect to the right to vote, call meetings of
shareholders or give consents or approval of any kind as to any of the Locked-Up
Securityholder’s Canopy Securities;

 

- 2 -

--------------------------------------------------------------------------------

  (d)

not to sell, transfer, assign, convey or otherwise dispose of, or enter into any
agreement or understanding relating to the sale, transfer, assignment,
conveyance or other disposition of, any of the Locked-Up Securityholder’s Canopy
Securities prior to the record date in respect of the Meeting to any person
other than to: (i) CBG or any of its subsidiaries (as such term is defined in
the Securities Act (Ontario)); (ii) an affiliate or associate (as such terms are
defined in the Securities Act (Ontario)) of such Locked-Up Securityholder
provided that such affiliate or associate first agrees with CBG to be bound by
the terms hereof; (iii) a self-directed registered retirement savings account in
which the Locked-Up Securityholder is the beneficiary; or (iv) any person with
the prior written consent of CBG, acting in its sole discretion; and

 

  (e)

except to the extent permitted hereunder, not to take any action, directly or
indirectly, which may reasonably be expected to adversely affect, delay, hinder,
upset or challenge the successful completion of the Transactions.

 

2.

Representations and Warranties

The Locked-Up Securityholder represents and warrants to CBG that:

 

  (a)

the Locked-Up Securityholder is authorized and has the authority to execute and
deliver this letter agreement and carry out the transactions contemplated hereby
and this letter agreement is a valid and binding agreement enforceable against
the Locked-Up Securityholder in accordance with its terms;

 

  (b)

the Locked-Up Securityholder is the beneficial owner of, or exercises control
and direction over, the number of Canopy Shares set forth in Schedule A hereto,
and the Canopy Shares are the only securities in the capital of Canopy
conferring voting rights at the Meeting beneficially owned by the Locked-Up
Securityholder or over which he, she or it exercises control or direction;

 

  (c)

the Locked-Up Securityholder’s Canopy Securities are not subject to any
shareholders’ agreements, voting trust or similar agreements or any right or
privilege (whether by law, pre-emptive or contractual) capable of becoming a
shareholders’ agreement, voting trust or other agreement affecting such
Locked-Up Securityholder’s Canopy Securities or any interest therein or right
thereto, including, without limitation, the voting of any such shares, other
than pursuant to this letter agreement; and

 

  (d)

other than pursuant to this letter agreement, the Locked-Up Securityholder has
not previously granted or agreed to grant any proxy or any other right to vote
any of the Locked-Up Securityholder’s Canopy Securities in respect of any
meeting of securityholders of Canopy that is currently in force, and has not
entered into a voting trust, vote pooling or other agreement with respect to
his, her or its right to vote, call meetings of securityholders of Canopy or
give consents or approvals of any kind as to the Locked-Up Securityholder’s
Canopy Securities.

 

3.

Termination

The respective rights and obligations hereunder of CBG and the Locked-Up
Securityholder shall cease and this letter agreement shall terminate on the
earlier of: (a) the Closing; (b) the date on which this letter agreement is
terminated by the mutual written agreement of the parties hereto; and (c) the
date the Consent Agreement is terminated in accordance with its terms.

 

4.

Fiduciary Obligations

Notwithstanding any other provision of this Agreement, CBG hereby agrees and
acknowledges that the Locked-Up Securityholder is bound hereunder solely in his
capacity as a shareholder of the Company and that the provisions hereof shall
not be deemed or interpreted to bind the Locked-Up Securityholder in his
capacity as a director or officer of the Corporation. Nothing in this Agreement
shall: (a) limit or affect any actions or omissions taken by the Locked-Up
Securityholder in his capacity as a director or officer of the Corporation, and
no such actions or omissions shall be deemed a breach of this Agreement or
(b) be construed to prohibit, limit or restrict the Shareholder from fulfilling
his fiduciary duties as a director or officer of the Corporation.

 

- 3 -

--------------------------------------------------------------------------------

5.

Notices

All notices to be given to a party hereunder shall be in writing and delivered
personally or by overnight courier, addressed, in the case of the Locked-Up
Securityholder, to the address set forth in the signature page of the Locked-Up
Securityholder set forth in this letter agreement, and in the case of CBG, at
the following address:

c/o Constellation Brands, Inc.

207 High Point Drive, Bldg. 100,

Victor, New York 14564

Attention:            General Counsel

and to:

Osler, Hoskin & Harcourt LLP

1 First Canadian Place, Suite 6200

Toronto, Ontario M5X 1B8

Attention:            Emmanuel Pressman and James R. Brown

 

6.

Further Assurances

The Locked-Up Securityholder shall from time to time and at all times hereafter
at the request of CBG but without further consideration, do and perform all such
further acts, matters and things and execute and deliver all such further
documents, deeds, assignments, agreements, notices and writings and give such
further assurances as shall be reasonably required for the purpose of giving
effect to this letter agreement.

 

7.

Enurement

This letter agreement will be binding upon and enure to the benefit of CBG, the
Locked-Up Securityholder and their respective executors, administrators,
successors and permitted assigns.

 

8.

Applicable Law

This letter agreement shall be governed and construed in accordance with the
laws of the Province of Ontario and the federal laws of Canada applicable
therein and each of the parties hereto irrevocably attorns to the jurisdiction
of the courts of the Province of Ontario.

 

9.

Severability

If any provision of this letter agreement is determined to be void or
unenforceable, in whole or in part, it shall be severable from all other
provisions hereof and shall be deemed not to affect or impair the validity of
any other provision hereof and each such provision is deemed to be separate and
distinct.

 

10.

Enforcement

The parties agree that irreparable damage would occur in the event that any of
the provisions of this letter agreement were not performed in accordance with
their specific terms or were otherwise breached. It is accordingly agreed that
the parties shall be entitled to an injunction or injunctions to prevent
breaches of this letter agreement and to enforce specifically the terms and
provisions hereof in any court of the Province of Ontario in addition to any
other remedy to which such party is entitled at law or in equity.

 

11.

Entire Agreement

This letter agreement supersedes all prior agreements between the parties hereto
with respect to the subject matter hereof and contains the entire agreement
among the parties with respect to the subject matter hereof. This letter
agreement may not be modified or waived, except expressly by an instrument in
writing signed by all the parties hereto. No waiver of any provision hereof by
any party shall be deemed a waiver by any other party nor shall any such waiver
be deemed a continuing waiver of any matter by such party.

 

- 4 -

--------------------------------------------------------------------------------

12.

Counterparts

This letter agreement may be signed in counterparts which together shall be
deemed to constitute one valid and binding agreement and delivery of such
counterparts may be effected by means of facsimile or e-mail or electronic
transmission.

[The next page is the signature page.]

 

- 5 -

--------------------------------------------------------------------------------

This letter agreement shall be effective and enforceable in accordance with its
terms effective as of the date that the Consent Agreement is executed by the
parties thereto.

 

Yours truly, CBG HOLDINGS LLC Per:       Name:   Title:

[Voting Support Agreement]

--------------------------------------------------------------------------------

ACCEPTANCE

For good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Locked-Up Securityholder hereby irrevocably accepts the
foregoing as of the          day of April, 2019.

 

 

         

 

WITNESS      SECURITYHOLDER

 

    

 

Witness Name (please print)      Name of Locked-Up Securityholder (please print)

 

ADDRESS OF LOCKED-UP SECURITYHOLDER:   

 

  

 

  

 

  

 

  

 

   Facsimile Number:       E-mail:   

 

     

 

   With a copy of notices to:                            Canopy Growth
Corporation                            1 Hershey Drive,   
                        Smiths Falls, Ontario K7A 0A8   
                        Attention:   

Phil Shaer, Chief Legal Officer

                           Email:   

phil.shaer@canopygrowth.com

  

[Voting Support Agreement]

--------------------------------------------------------------------------------

SCHEDULE A

 

Common Shares