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The Flowr Corporation seeks creditor protection from Canadian court

The Flowr Corporation and its subsidiaries, The Flowr Group, The Flowr Canada Holdings, and Terrace Global, will make an application for an order for creditor protection from the Ontario Superior Court of Justice under the Companies Creditors Arrangement Act. The company will be making its application to Court for the Initial Order on October 20, 2022.

After careful consideration of all available alternatives following thorough consultation with legal and financial advisors, the directors of the company have determined that it is in the best interests of the Flowr Group to file an application for creditor protection under the CCAA.

The Initial Order being sought would include, among other things: (i) a stay of proceedings in favor of the Flowr Group; (ii) approval of the DIP Loan (as described below); and (iii) the appointment of Ernst & Young Inc. as a monitor of the Flowr Group (in such capacity, the “Monitor”). The Flowr Group is seeking creditor protection under the CCAA in order to receive a stay of proceedings that will allow the Flowr Group to conduct a sale and investment solicitation process (“SISP”) and facilitate a transaction that sees the company emerge from CCAA protection as a going concern.

If the Initial Order is granted, the company intends to operate in the ordinary course throughout the CCAA proceedings and while conducting the SISP. Management of the Company would remain responsible for the day-to-day operations of the company under the general oversight of the monitor.

In order to fund the CCAA proceedings, the SISP, and other short-term working capital requirements, the Flowr Group has executed a term sheet with 1000343100 Ontario Inc. (the “DIP Lender”), pursuant to which the DIP Lender will advance a debtor-in-possession loan in the amount of $2,000,000 (the “DIP Loan”). The DIP Loan is conditional on, among other things, the issuance of the Initial Order.

The company’s common shares will be transferred to the NEX Board of TSX Venture Exchange (the “TSXV”), where trading will be suspended. If the Initial Order is granted, the company will be authorized by the Court to incur no further expenses in relation to the filing of continuous disclosure documents, including press releases.

For more information:
Flowr
www.flowr.ca  


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