The Compensation Committee’s review and determination of the applicable peer group appropriately balanced the following four relevant spectrums:
| 1. | Industry: Focus was given to companies in the cannabis industry as this best represents the main customer, labor and capital markets in which Tilray competes; however, given Tilray is larger than other cannabis companies, it was important to assess other industries as well. |
| • | Broader biotechnology / pharmaceuticals companies were included because they are similar to Tilray’s medical cannabis business in many respects. |
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| • | Companies in the consumer-packaged goods industry were also considered due to Tilray’s consumer-product based business model, and Tilray’s expansion of products and services in the brewery and distillery industry. |
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| • | Because the Company’s operations span multiple industries, the Committee also believes that a consistent approach across the breadth of the Company’s operations with respect to features of our overall executive compensation structure is best achieved by reference to a group of general industry peers that is broader than the cannabis, biotechnology, and consumer-packaged goods industry peers. |
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| 2. | Size: Company size is a strong indicator of organizational complexity and drives scope of accountability. |
| • | Given the anticipated growth of Tilray following the Business Combination and the cannabis sector overall, a wider financial lens was applied by Korn Ferry, and revenue was the primary indicator of size. Total assets and market capitalization were used as secondary reference points. |
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| 3. | Operations: As Tilray is an established international operator in the cannabis industry, focus was given to companies that are based in North America and have international operations. |
| 4. | Location: The regions or countries where Tilray competes for talent. Our approach proposes to focus the executive compensation analysis primarily to Canadian and U.S.-based companies. |
| • | Since Tilray is U.S.-based with Canadian and U.S.-sourced executives, the Canadian and U.S. markets are both relevant sources of data. Should other markets become relevant in the future, consideration will be given to including companies from those geographies in Tilray’s peer group. |
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It was important to the Compensation Committee that the peer group reflect high revenue growth companies.
In March 2021, the ultimate outcome of this peer group review was the creation of the following 18-company peer group for Fiscal Year 2022 and subsequent years, for purposes of determining the compensation arrangements for Tilray’s senior executive officers:
| Cannabis Companies Canopy Growth CorporationCuraleaf Holdings, Inc. | Cresco Labs, Inc.Green Thumb Industries, Inc. | GW Pharmaceuticals plcTrulieve Cannabis Corp. |
| Biotechnology/Pharmaceutical/Technology CompaniesCatalent, Inc.DocuSign, Inc. | Etsy, Inc.Incyte Corporation | Neurocrine Biosciences, Inc. Unity Software Inc. |
| Consumer Packaged Goods/Alcohol Companies Beyond MeatConstellation Brands, Inc. | Monster BeverageNational Beverage | The Boston Beer Company, Inc.The Simply Good Food Co. |
Based on Korn Ferry’s guidance, no changes were made to this peer group for purposes of Fiscal Year 2025 compensation. As the cannabis industry and our business evolves and diversifies, the Compensation Committee will continue to evaluate the appropriateness of each peer annually and make any necessary changes for Fiscal Year 2026.
