Leading Independent Proxy Advisory Firm ISS Recommends HEXO Shareholders Vote FOR the Arrangement Agreement with Tilray Brands

HEXO Corp. (TSX: HEXO; NASDAQ: HEXO) (“HEXO” or the “Company”) is pleased to announce that Institutional Shareholder Services Inc. ("ISS"), a leading independent proxy advisory firm, has issued a report recommending that HEXO Shareholders vote FOR the arrangement agreement (the "Arrangement") between HEXO and Tilray Brands, Inc. (“Tilray”).

In reaching its conclusion, ISS noted¹:

• “The transaction makes strategic sense as the combination will provide shareholders with the opportunity to continue to hold their investment in the assets of the company as well as participate as shareholders of the purchaser and as shareholders of a larger and more diversified company."
• “The all-share consideration conveys a value transfer per HEXO share of C$1.52 [USD$1.25] which represents a 10.1 percent discount to the unaffected share price, and although potential governance concerns have been raised pertaining to the lack of public disclosure relating to any strategic review process, elevated change of control payments and termination fee arrangements, and reasonable concerns may exist that the offer could fail to capture the value of the company which would be discovered in a competitive bidding process, the risks and benefits of the transaction appear to have been appropriately weighed against the company's only likely alternative, being the status quo.”
• “On balance, and in light of the reasonable strategic rationale, company's financial going concern issues, liquidity concerns, and non-approval risk associated with the arrangement, shareholder approval of this resolution is warranted.”

Arrangement Agreement with Tilray

Under the terms of the Arrangement Agreement, Tilray will acquire all of the issued and outstanding common shares of the Company (the “Company Shares”). HEXO Shareholders will receive 0.4352 of a share of Tilray common stock (“Tilray Shares”) in exchange for each whole Company Share held.

YOUR VOTE IS IMPORTANT REGARDLESS OF THE NUMBER OF SHARES YOU OWN

Shareholders are encouraged to vote in advance of the proxy cut-off time of 4:00 p.m. (EDT) on June 12, 2023, in accordance with the instructions accompanying the form of proxy or voting instruction form mailed to Shareholders together with the Circular. Further details and voting instructions can be found in the Circular or at www.HEXOVOTE.com.