• Avant 50% joint venture executes binding offer to purchase Flowr Okanagan, including Flowr's Kelowna facility, for $3.88 million
• Provides Avant with combined facilities of approximately 185,000 square ft
• Expected to increase Avant's production capabilities by 60%
• Would result in Avant being one of the largest indoor, ultra-premium producers in Canada

KELOWNA, BC / ACCESSWIRE / November 1, 2022 / Avant Brands Inc. (TSX:AVNT)(OTCQX:AVTBF)(FRA:1BU0) ("Avant" or the "Company"), a leading producer of innovative, premium handcrafted cannabis products, is pleased to announce that 1000343100 Ontario Inc. (the "Purchaser"), an entity of which Avant owns 50% of the issued and outstanding shares, has entered into a stalking horse purchase agreement (the "Stalking Horse Purchase Agreement") to acquire all of the issued and outstanding shares (the "Purchased Shares") in the capital of The Flowr Group (Okanagan) Inc. ("Flowr Okanagan"), a subsidiary of The Flowr Corporation (FLWR; FLWPF) ("Flowr"), in connection with the Flowr Group's (as defined below) proceedings under the Companies' Creditors Arrangement Act and its related sales and investment solicitation process ("SISP"). The authorization by Flowr Okanagan and The Flowr Canada Holdings ULC ("Flowr ULC") to enter into the Stalking Horse Purchase Agreement and its acceptance as the Stalking Horse Bid (as defined in the SISP) is subject to approval by the Ontario Superior Court of Justice (Commercial List) (the "Court"). It is also anticipated that the Purchaser will change its name to Avant Brands K1 Inc. prior to closing.

"Continuing on from a strong record third quarter, we anticipate that the overall global demand for Avant's products exceeds our current output" said Norton Singhavon, Founder and Chief Executive Officer of Avant. "As a result, Avant has entered into the Stalking Horse Purchase Agreement in order to satisfy this demand. Flowr has developed an 85,000 square foot facility built to GMP standards, which is conveniently located in Kelowna, British Columbia, making this a natural fit for the Avant portfolio."

The Stalking Horse Purchase Agreement was entered into between the Purchaser, Flowr Okanagan and Flowr ULC. The purchase price payable by the Purchaser for the Purchased Shares pursuant to the Stalking Horse Purchase Agreement shall be equal to $3,888,888.88 plus an amount reasonably necessary to fund the cash requirements of the Flowr Group (in excess of the amounts available under the DIP Loan, defined below) to close the transactions (the "Closing DIP Amount"), if any, and the assumption of certain liabilities (the "Assumed Liabilities") set out in the Stalking Horse Purchase Agreement, as may be adjusted in accordance with its terms (collectively, the "Purchase Price").

The Purchase Price will be satisfied through: (a) a credit bid of the DIP Loan (as defined below) in a principal amount of $2,000,000, plus the Closing DIP Amount, if any, and any accrued and unpaid interest, expenses, fees and other amounts thereon (the "Credit Bid"), (b) a cash amount equal to the Purchase Price less the Credit Bid in cash, a portion of which may be payable in non-cash consideration in certain circumstances, and (c) the assumption of the Assumed Liabilities. Excluded assets and excluded liabilities of Flowr Okanagan will be discharged from Flowr Okanagan pursuant to an Approval and Vesting Order to be sought in accordance with the terms of the Stalking Horse Purchase Agreement.

If the transaction contemplated by the Stalking House Purchase Agreement closes, the Flowr Okanagan facility would increase Avant's overall square footage of cultivation facilities to approximately 185,000 square feet, and thereby increasing Avant's annual production capacity by approximately 60%[1]. It is anticipated that Avant will be one of the largest indoor producers in Canada of indoor grown, ultra-premium cannabis[2].

The consummation of the transactions contemplated under the Stalking Horse Purchase Agreement are subject to satisfaction or waiver of a number of conditions set forth in the Stalking Horse Transaction Agreement, including, among other things, receipt of regulatory approval, the Stalking Horse Purchase Agreement being determined to be the successful bid in the SISP and the Court granting both an order approving the Stalking Horse Purchase Agreement and an Approval and Vesting Order. If other bids superior to the Stalking Horse Purchase Agreement are submitted in the SISP, an auction will be held, and the Purchaser may elect to increase the Purchase Price or otherwise vary the terms of the Stalking Horse Purchase Agreement.

In the event the Purchaser is not the winning bidder under any such auction, the Stalking Horse Purchase Agreement will be terminated, and the Purchaser will be entitled to payment of a break-up fee in the amount of $185,000, following closing of the winning bid.

The Company previously announced that the Purchaser had executed a term sheet with Flowr and its subsidiaries, Flowr Okanagan, Flowr ULC and Terrace Global Inc. ("Terrace" and collectively with Flowr, Flowr Okanagan and Flowr ULC, the "Flowr Group"), pursuant to which the Purchaser has made available debtor-in-possession loan (the "DIP Loan") in a principal amount of up to $2,000,000 in connection with the Flowr Group's filing for protection from the Court under the Companies' Creditors Arrangement Act.

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1. This estimate is based on the assumption that the output at Flowr's facility will be consistent with the production output at Avant's existing facilities.

2. This estimate is based on publicly available information on other Licensed Producers, with products for sale on OCS.ca, that are priced in-line with Avant's flagship brand, BLK MKT or higher.

About Avant Brands Inc.

Avant is an innovative, market-leading premium cannabis company. Avant has multiple operational production facilities across Canada, which produce high-quality, handcrafted cannabis products, based on unique and exceptional cultivars. Avant's products are distributed via three complementary sales channels: recreational, medical and export. Avant's recreational consumer brands include: BLK MKT™, Tenzo™, Cognōscente™ and Treehugger™, which are sold in British Columbia, Saskatchewan, Manitoba, Ontario, Atlantic Canada and the territories. The Company's medical cannabis brand, GreenTec™, is distributed nationwide, directly to qualified patients through its GreenTec Medical portal and through various medical cannabis partners.

Avant is a publicly traded corporation listed on the Toronto Stock Exchange (TSX: AVNT), and cross-trades on the OTCQX Best Market (OTCQX: AVTBF) and Frankfurt Stock Exchange (FRA: 1BU0). The Company is headquartered in Kelowna, British Columbia and has operations in British Columbia, Alberta and Ontario.

To learn more about Avant, access the investor presentation, or learn more about its consumer brands, please visit www.avantbrands.ca.

For additional information, please contact:

Investor Relations at Avant Brands Inc.
1-800-351-6358
ir@avantbrands.ca

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION:

This news release includes certain "forward-looking information" as defined under applicable Canadian securities legislation, including statements regarding the plans, intentions, beliefs and current expectations of the Company with respect to future business activities and operating performance. Forward-looking information is often identified by the words "may", "would", "could", "should", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" or similar expressions and includes information regarding: the consummation of the transaction set out in the Stalking-Horse Purchase Agreement; advances pursuant to the DIP Loan; the Company's expectations that the overall global demand for Avant's products will exceed current output; the use of the Stalking Horse Purchase Agreement to satisfy the anticipated increase in demand; the expected increase to Avant's overall square footage of cultivation facilities and increase in annual production capabilities; the Company's expectation that they will become one of the largest indoor producers of premium cannabis products in Canada; and expectations for other economic, business, and/or competitive factors. Forward-looking information is necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking information. Examples include statements that the Company will operate in a fiscally disciplined manner; that the Company will build long-term shareholder value and reduce operational expenses; or that the Company will increase its revenue and gross margins.

Investors are cautioned that forward-looking information is not based on historical fact but instead reflects management's expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. Although the Company believes that the expectations reflected in such forward-looking information are reasonable, such information involves risks and uncertainties, and undue reliance should not be placed on such information, as unknown or unpredictable factors could have material adverse effects on future results, performance or achievements of the Company. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking information are the following: the ability of the Company to receive, in a timely manner and on satisfactory terms, the necessary regulatory and court approvals; the ability of the parties to satisfy, in a timely manner, the other conditions set forth in the Stalking Horse Purchase Agreement; the prompt and effective integration of Flowr's operations with the Company's; the ability to achieve the anticipated synergies; inherent uncertainty associated with projections; diversion of management time on transaction related issues; expectations regarding future growth and expansion; regulatory and licensing risks; changes in consumer demand and preferences; changes in general economic, business and political conditions, including changes in the financial markets and inflation-related risks; the global regulatory landscape and enforcement related to cannabis, including political risks and risks relating to regulatory change; compliance with extensive government regulation; public opinion and perception of the cannabis industry; and the risk factors set out in the Company's annual information form dated February 28, 2022, filed with Canadian securities regulators and available on the Company's profile on SEDAR at www.sedar.com.

Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties and factors that could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward-looking information, which speak only as of the date of this news release. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

SOURCE: Avant Brands, Inc.