This news release constitutes a "designated news release" for the purposes of Canopy Growth's prospectus supplement dated

news release constitutes a "designated news release" for the purposes of Canopy Growth's prospectus supplement dated

August 29, 2025 to its short form base shelf prospectus dated June 5, 2024

Growth Announces Strategic Recapitalization Transactions

Strengthening Balance Sheet to Support Growth Strategy

Term Loan due 2027 and Exchanges Convertible Debentures due 2029, Extending Maturities of All Outstanding Indebtedness to Earliest January

2031 While Enhancing Liquidity Profile

SMITHS FALLS, ON. January 8, 2026

-- Canopy Growth Corporation ("Canopy Growth" or the "Company") (TSX: WEED)

(Nasdaq: CGC), a world-leading cannabis company dedicated to unleashing the power of cannabis to improve lives, announced today that the

Company has entered into a series of transactions to recapitalize its balance sheet and extend the maturity dates of all outstanding indebtedness

to January 2031 at the earliest. At the conclusion of these Transactions (as defined below), Canopy Growth is expected to have cash on

hand of approximately C$425 million, providing additional flexibility to support the Company's long-term priorities.

Canopy Growth moves forward from a position of strength, supported by a robust balance sheet, enhanced liquidity, extended debt maturities,

and a clear strategic direction," said Tom Stewart, Chief Financial Officer of Canopy Growth. "We have created a financial

runway through 2031, giving us the ability to seize opportunities for growth, building on the momentum of our previously announced acquisition

of MTL Cannabis Corp."

continue to execute our strategy focused on disciplined growth, operational excellence and financial stewardship, these Transactions enable

the strategic scaling necessary to reinforce Canopy Growth's leadership position, support growing demand in the European medical

market, and advance our path to sustained Adjusted EBITDA profitability," said Luc Mongeau, Chief Executive Officer of Canopy Growth.

Term Loan Transaction

with the terms of a term loan agreement (the "Loan Agreement"), the Company will receive net proceeds of US$150 million (the

"Term Loan") in connection with the Loan Agreement (the "Loan Transaction") from a group of lenders led by JGB

Management Inc. (the "Lenders"), with the Term Loan maturing in January 2031. Canopy Growth intends to use the net proceeds

from the Term Loan to (i) repay its existing senior secured debt in the principal amount of approximately US$101 million due September

2027; (ii) for working capital and general corporate purposes; and (iii) to fund any potential future acquisitions.

will bear interest at an annual rate equal to the applicable Term SOFR rate (subject to a minimum floor of 3.25%) plus 6.25%, representing

a decrease in the Company's cash interest rate compared with its current existing senior secured debt.

Convertible Debenture Exchange

with the execution of the Loan Agreement, Canopy Growth also entered into an exchange agreement (the "Exchange Agreement")

with a single institutional investor (the "Investor") pursuant to which Canopy Growth will exchange approximately C$96.4 million

of existing convertible debentures due May 2029 (the "Existing Debentures") for approximately C$80 million (the "Exchange

Transaction" and together with the Loan Transaction, the "Transactions") comprising: (a) C$55 million of new convertible

debentures (the "Debentures") due July 2031; (b) C$10.5 million in cash; (c) 9,493,670 common shares of the Company (the "Common

Shares"); and (d) 12,731,481 Common Share purchase warrants of the Company (the "Investor Warrants"). The Debentures

will bear interest at a rate of 7.50% per annum, payable semi-annually in cash, and will be convertible into Common Shares at the option

of the holder at a conversion price equal to C$1.83 per Common Share.

are expected to close on or around January 8, 2026 (the "Closing Date"), subject to customary closing conditions.

Additional Transaction Details

principal amount of the Term Loan is approximately US$162 million reflecting an original issue discount. Interest on the Term Loan will

be paid monthly in arrears in cash. Following the first anniversary of the first interest payment date, each Lender will have the option

to require the borrowers to repay such Lender its pro rata share of up to US$3 million of principal per calendar month on each

payment date thereafter. Prepayment and repayment of the Term Loan will be subject to (i) an interest make-whole equal to 12 monthly interest

payments less any payments made by the borrowers on account of interest prior to the date of such prepayment for any prepayments or repayments

made during the first year of the Term Loan and (ii) an exit fee equal to approximately US$6.5 million, provided that, with respect to

any partial payment of the Term Loan, only the pro rata portion of such exit fee will be payable at the time of each such partial

payment. The Term Loan and obligations under the Loan Agreement and other related loan documents will be secured by substantially all

of the assets of the Company and each of its material subsidiaries.

also includes certain prepayment fees, a minimum cash requirement of the lesser of US$90 million, or the principal amount of the term

loan, and various other representations, warranties, covenants and events of default customary for a financing of this nature.

with the Loan Agreement, on the Closing Date, the Company will issue 18,705,577 common share purchase warrants of the Company (the "Loan

Warrants") to the Lenders. Each Loan Warrant will entitle the holder to acquire one Common Share at an exercise price equal to US$1.30

per Common Share for a period of five years from the Closing Date. Pursuant to the Exchange Transaction, each Investor Warrant will entitle

the holder to acquire one Common Share at an exercise price equal to C$2.16 per Common Share for a period of five years from the Closing

Date, the Company will enter into registration rights agreements with the Investor and the Lenders, as applicable, pursuant to which the

Company will agree to file registration statements with the U.S. Securities and Exchange Commission (the "SEC") covering the

resale of the Common Shares issued to the Investor in the Exchange Transaction and the Common Shares underlying the Debentures and the

Investor Warrants as well as the Loan Warrants, as applicable.

This news release shall not constitute an offer

to sell or a solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or other jurisdiction

in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any

such state or other jurisdiction.

Canaccord Genuity Corp. acted as exclusive financial

advisor and Cassels Brock & Blackwell LLP acted as Canadian counsel to Canopy Growth in connection with the Transactions. Goodwin

Procter LLP and Paul Hastings LLP acted as US counsel to Canopy Growth in connection with the Loan Transaction and the Exchange Transaction,

respectively. Haynes and Boone, LLP and Stikeman Elliott LLP acted as counsel to JGB Management Inc. in connection with the Loan Transaction.

Sr. Director, Communications

Director, Investor Relations

Canopy Growth is a world leading cannabis company

dedicated to unleashing the power of cannabis to improve lives.

Through an unwavering commitment to consumers,

Canopy Growth delivers innovative products from owned and licensed brands including Tweed, 7ACRES, DOJA, Deep Space and Claybourne, as

well as category defining vaporization devices by Storz & Bickel. In addition, Canopy Growth serves medical cannabis patients globally

with principal operations in Canada, Europe and Australia.

Canopy Growth has also established a comprehensive

ecosystem to realize the opportunities presented by the U.S. THC market through an unconsolidated, non-controlling interest in Canopy

USA, LLC ("Canopy USA"). Canopy USA's portfolio includes ownership of Acreage Holdings, Inc., a vertically integrated

multi-state cannabis operator with operations throughout the U.S. Northeast and Midwest, as well as ownership of Wana Wellness, LLC, The

Cima Group, LLC, and Mountain High Products, LLC, a leading North American edibles brand, and majority ownership of Lemurian Inc., a California-based

producer of high-quality cannabis extracts and clean vape technology.

we're shaping a future where cannabis is embraced for its potential to enhance well-being and improve lives. With high-quality products,

a commitment to responsible use, and a focus on enhancing the communities where we live and work, we're paving the way for a better

understanding of all that cannabis can offer.

For more information

visit www.canopygrowth.com.

Forward-Looking Statements

This news release contains "forward-looking

statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and "forward-looking

information" within the meaning of applicable Canadian securities legislation. Often, but not always, forward-looking statements

and information can be identified by the use of words such as "plans", "expects" or "does not expect",

"is expected", "estimates", "intends", "anticipates" or "does not anticipate",

or "believes", or variations of such words and phrases or state that certain actions, events or results "may",

"could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements

or information involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements

of the Company or its subsidiaries to be materially different from any future results, performance or achievements expressed or implied

by the forward-looking statements or information contained in this news release. Examples of such statements and uncertainties include

statements with respect to the Company's debt extinguishment; expectations regarding cash on hand following the closings of the

Transactions; the expected benefits of the Transactions, including the Company's strengthened financial position, opportunities

for growth and strategic scaling; the ability to advance to sustained Adjusted EBITDA profitability; the expected closing date of the