Hawthorne Canada Limited entered into an agreement to acquire KRS Facility in Kelowna from The Flowr Corporation (TSXV:FLWR) for CAD 16 million on February 16, 2022. The consideration will be paid as follows: 1) an initial cash payment of CAD 3.0 million; 2) full extinguishment of the principal amount outstanding under the existing loan agreement between Flowr and Hawthorne for the construction of the KRS Facility on closing, currently at approximately CAD 12 million; and 3) the balance of the purchase price paid in cash upon closing. The KRS Sale is expected to close in Q2 2022 and is subject to certain closing conditions, including receipt of all necessary regulatory and third-party approvals.

The Flowr Corporation (TSXV:FLWR) completed the acquisition of KRS Facility in Kelowna on July 27, 2022. The Company is using the proceeds from the sale of this non-core asset to reduce the outstanding principal debt under its ATB led credit facility to CAD 1 million.