High Tide Inc. — M&A Activity 2021

Jan 15, 2021

Form 51-102F4

Business Acquisition Report

Item 1 Identity of Company

1.1 Name and Address of Company

High Tide Inc. (“ High Tide ” or the “ Corporatio n”) Unit 112, 11127 - 15 Street N.E. Calgary, Alberta T3K 2M4

1.2 Executive Officer

Raj Grover Chief Executive Officer and Director Unit 112, 11127 - 15 Street N.E. Calgary, Alberta T3K 2M4 Phone: 403 703-4272

Item 2 Details of Acquisition 2.1 Nature of Business Acquired

On November 18, 2020, High Tide and Meta Growth Corp. (“ Meta ”) completed a plan of arrangement (the " Arrangement ") under Section 193 of the Business Corporations Act (Alberta). Pursuant to the Arrangement, High Tide acquired all the issued and outstanding common shares of Meta (the " Meta Shares "). Pursuant to the Arrangement, holders of Meta Shares received 0.824 (the " Exchange Ratio ") of a common share of High Tide for each Meta Share held at the time of closing. Meta is now a wholly owned subsidiary of High Tide.

The Arrangement was completed pursuant to an arrangement agreement between High Tide and Meta dated August 20, 2020. The Arrangement was approved by the shareholders of Meta at a special meeting of shareholders held on October 27, and the Court of Queen's Bench of Alberta issued a final order approving the Arrangement on October 28, 2020.

Further information about the Arrangement can be found in the management information circular of Meta dated September 23, 2020, which can be accessed under Meta's issuer profile on SEDAR at www.sedar.com.

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Meta operates legal recreational retail cannabis stores to sell cannabis and cannabis related products through its Canada-wide network of Meta Cannabis Co.™, Meta Cannabis Supply Co.™ and NewLeaf Cannabis™.

2.2 Acquisition Date

November 18, 2020.

2.3 Consideration

Pursuant to the Arrangement, holders of Meta Shares received 0.824 of a common share of High Tide for each Meta Share held at the time of closing.

In accordance with the terms set out in the respective warrant certificates or warrant indentures representing common share purchase warrants of Meta, each holder of a common share purchase warrant of Meta became entitled to receive upon the exercise of such holder’s common share purchase warrants of Meta, for the same aggregate consideration, such number of common shares of High Tide which the holder would have been entitled to receive as a result of the Arrangement if, immediately prior to the time of closing, such holder had been the registered holder of the number of Meta Shares to which such holder would have been entitled if such holder had exercised such holder’s common share purchase warrants of Meta immediately prior to the time of closing.

In accordance with the terms set out in the stock option plan of Meta, each holder of a stock option of Meta became entitled to receive upon the exercise of such holder’s stock option of Meta, for the same aggregate consideration, such number of common shares of High Tide which the holder would have been entitled to receive as a result of the Arrangement if, immediately prior to the time of closing, such holder had been the registered holder of the number of Meta Shares to which such holder would have been entitled if such holder had exercised such holder’s stock options of Meta immediately prior to the time of closing.

In accordance with the terms set out in the respective debenture certificates and the debenture indenture of Meta, each holder of a convertible debenture of Meta became entitled to receive upon conversion, for the same aggregate consideration, such number of common share of High Tide which the holder would have been entitled to receive as a result of the Arrangement if, immediately prior to the time of closing, such holder had been the registered holder of the number of Meta Shares to which such holder would have been entitled if such holder had converted such debenture of Meta immediately prior to the time of closing. Each convertible debenture of Meta continues to be governed by and be subject to the terms of the existing debenture certificates or debenture indenture.

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In accordance with the terms set out in the restricted share unit plan of Meta, each holder of a restricted share unit of Meta will receive upon the vesting of such holder’s restricted share unit, such number of common shares of High Tide which the holder would have been entitled to receive as a result of the Arrangement if, immediately prior to the time of closing, such holder had been the registered holder of the number of Meta Shares to which such holder would have been entitled if such restricted share units vested immediately prior to the time of closing.

2.4 Effect on Financial Position

Except as otherwise publicly disclosed and in the ordinary course of High Tide’s business, High Tide presently has no plans or proposals for material changes in High Tide’s business affairs or the affairs of Meta that may have a significant effect on the results of operations and financial position of High Tide.

2.5 Prior Valuations

No valuation opinion was obtained in the last 12 months by High Tide or Meta, as no such valuation opinion was required by securities legislation or a Canadian exchange or market to support the Consideration under the Arrangement. However, Meta obtained a fairness opinion from Echelon Wealth Partners Inc., dated August 20, 2020, attesting to the fairness of the Arrangement to Meta and Meta shareholders, from a financial point of view.

2.6 Parties to Transaction

The Arrangement was not with an “informed person” (as such term is defined in Section 1.1 of National Instrument 51-102 – Continuous Disclosure Obligations ), associate or affiliate of High Tide.

2.7 Date of Report

January 15, 2021

Item 3 Financial Statements and Other Information

Audited consolidated annual financial statements of Meta and related notes thereto as of and for the years ended August 31, 2020 and 2019 (the “ Meta Annual Financial Statements ”) are attached hereto as Schedule “A”.

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SCHEDULE “A”

META FINANCIAL STATEMENTS

(See attached)

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META GROWTH CORP.

Consolidated Financial Statements

For the Years Ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

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 

   

   





      

 

•     

•   

•  

•        

•   

•    

  

  

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META GROWTH CORP. Consolidated Statements of Financial Position As at August 31, 2020 and 2019 (Expressed in Canadian Dollars)

		August 31		August 31
	Notes	2020		2019
Assets
Current
Cash and cash equivalents	Note 4	$ 11,151,223	$	7,528,849
Restricted cash		-		501,965
Trade and other receivables	Note 5	2,277,982		762,019
Inventory	Note 6	3,129,646		6,349,322
Prepaid expenses	Note 7	3,163,889		3,201,252
		$ 19,722,740	$	18,343,407
Non-current
Derivative asset	Note 9	$ 43,016		-
Investment	Note 9	696,205		-
Note receivable	Note 8	312,082		-
Property and equipment	Note 10	6,015,792	$	10,621,620
Assets in process	Note 11	1,778,084		3,567,649
Right of use assets	Note 12	7,743,955		-
Prepaid expenses	Note 7	-		911,209
Loan receivable	Note 13	1,710,924		-
Intangible Assets	Note 14	8,863,792		21,160,173
Goodwill	Note 14	1,948,143		6,904,394
Total Assets		$ 48,834,733	$	61,508,452
Liabilities
Current
Trade and other payables		$ 3,478,524	$	3,637,227
Debt financing	Note 15	-		9,000,000
Due to shareholders	Note 8	-		410,000
Lease inducements		-		95,519
Lease obligation	Note 12	2,376,458		-
		$ 5,854,982	$	13,142,746
Non-current
Lease inducements		$ -	$	290,305
Term loans	Note 15	13,592,156		-
Convertible debenture	Note 16	18,555,918		16,880,647
Deferred tax liability	Note 26	2,095,241		3,529,008
Lease obligation	Note 12	7,928,345		-
Total Liabilities		$48,026,642	$	33,842,706
Shareholders’ Equity
Share capital		$ 72,423,579	$	67,016,838
Warrants		7,735,962		3,066,865
Contributed surplus		5,438,431		4,841,684
Accumulated other comprehensive loss		(428,571)		(428,571)
Accumulated deficit		(84,188,440)		(46,735,892)
Equity attributable to Meta Growth Corp.		980,961		27,760,924
Non-controllinginterest	Note 19	(172,870)		(95,178)
Total Equity		$808,091	$	27,665,746
Total Liabilities and Equity		$ 48,834,733	$	61,508,452

Nature of operations (Note 1) Subsequent events (Note 29)

These financial statements were authorized for issue by the Board of Directors on December 17, 2020. They are signed on the Company’s behalf by:

Director Director

The accompanying notes are an integral part of these Consolidated Financial Statements

META GROWTH CORP. Consolidated Statements of Net Loss and Comprehensive Loss For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

	2020	2019
Revenues(Note 32)	$ 55,822,934	$ 52,861,598
Cost of Goods Sold	37,602,744	36,240,391
Gross Profit	$18,220,190	$16,621,207
Expenses
Advertising and marketing	346,345	589,512
Depreciation of property and equipment (Note 10)	2,781,873	1,552,165
Depreciation of right of use assets (Note 12)	2,848,585	-
Amortization of intangible assets	-	1,676,532
Share based compensation (Note 20)	596,747	963,891
Finance and other costs (Note 22)	7,352,042	5,307,584
General and administrative expenses(Note 33)	20,892,101	27,824,830
	$34,817,693	$37,914,514
Loss from operations	(16,597,503)	(21,293,307)
Other expenses (income)
Government grants (Note 32)	(1,026,934)	-
Loss / (Gain) on disposal of assets	(4,910)	84,418
Gain on investment (Note 9)	(1,122,544)	(597,864)
Gain on bargain purchase (Note 17)	(520,947)	-
Loss on revaluation of financial asset (Note 9)	247,595	-
Share of loss on equity investment	-	97,797
Impairment loss(Note 14)	23,421,506	3,827,011
Loss before income tax recovery	$ (37,591,269)	$ (24,704,669)
Income tax (recovery) (Note 26)	(1,466,787)	(2,824,630)
Net loss and comprehensive loss for theyear from continuingoperations	$ (36,124,482)	$ (21,880,039)
Net loss and comprehensive loss for the year from discontinued	(1,405,758)	(10,196,563)
operations(Note 8)
Net loss and comprehensive loss for theyear	$ (37,530,240)	$ (32,076,602)
Net loss and comprehensive loss attributable to:
Shareholders of Meta Growth Corp.	(37,452,548)	(26,758,676)
Non-controllinginterest(Note 19)	(77,692)	(5,317,926)
	$ (37,530,240)	$ (32,076,602)
Net loss per share(Note 23)
Net loss per share from continuing operations	(0.17)	(0.12)
Net lossper share from discontinued operations	-	(0.03)
Net lossper share	(0.17)	(0.15)

The accompanying notes are an integral part of these Consolidated Financial Statements.

META GROWTH CORP.

Consolidated Statements of Changes in Equity For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

	Share	Capital	Warrants		Accumulated		Non-
	Number of			Contributed	Other		Controlling
	Shares	Amount	Amount	Surplus	Comprehensive Loss	Deficit	Interest	Total
Balance, September 1, 2018	135,700,158	$ 25,794,995	$ 2,952,235	$ 1,245,455	$ (428,571)	$ (18,428,990)	$ 4,956,331	$ 16,091,455
Options exercised	3,225,000	1,269,493	-	(785,743)	-	-	-	483,750
Warrants exercised	135,462	237,077	(202,059)	-	-	-	-	35,018
Private Placement	21,978,020	20,000,000	-	-	-	-	-	20,000,000
Acquisition – The Green Company Ltd.	23,582,000	17,152,642	-	-	-	-	-	17,152,642
Acquisition – NAC Northern Alberta LP	2,173,913	1,500,000	-	-	-	(1,548,226)	266,417	218,191
Acquisition – New Leaf Emporium Inc.	649,880	526,403	-	-	-	-	-	526,403
Shares issued for contract settlement	90,000	72,900	-	-	-	-	-	72,900
Investment in Sicamous Trading Company	377,358	200,000	-	-	-	-	-	200,000
Warrants issued	-	-	316,689	-	-	-	-	316,689
Convertible debentures	1,290,150	881,504	-	3,418,081	-	-	-	4,299,585
Shares returned to Treasury	(109,000)	-	-	-	-	-	-	-
Share based compensation	-	-	-	963,891	-	-	-	963,891
Share issuance costs	-	(618,176)	-	-	-	-	-	(618,176)
Non-controlling interest	-	-	-	-	-	-	(5,317,926)	(5,317,926)
Net loss and comprehensive loss for the year	-	-	-	-	-	(26,758,676)	-	(26,758,676)
Balance, August 31, 2019	189,092,941	$ 67,016,838	$ 3,066,865	$ 4,841,684	$ (428,571)	$ (46,735,892)	$ (95,178)	$27,665,746
Acquisition – The Green Company Ltd. (Note 18)	(2,007,860)	-	-	-	-	-	-	-
Convertible debentures (Note 16)	4,140,005	846,000	-	-	-	-	-	846,000
Bought deal financing (Note 18)	45,454,600	5,636,370	4,363,642	-	-	-	-	10,000,012
Share based compensation (Note 20)	-	-	-	596,747	-	-	-	596,747
Share issuance costs	-	(1,075,629)	305,455	-	-	-	-	(770,174)
Non-controlling interest	-	-	-	-	-	-	(77,692)	(77,692)
Net loss and comprehensive loss for the year	-	-	-	-	-	(37,452,548)	-	(37,452,548)
Balance, August 31, 2020	236,679,686	$ 72,423,579	$ 7,735,962	$ 5,438,431	$ (428,571)	$ (84,188,440)	$ (172,870)	$808,091

The accompanying notes are an integral part of these Consolidated Financial Statements

META GROWTH CORP. Consolidated Statements of Cash Flows For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

META GROWTH CORP. Consolidated Statements of Cash Flows For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)
	2020	2019
Operating Activities
Net loss and comprehensive loss	$ (37,530,240)	$ (32,076,602)
Adjustments for items not effecting cash and cash equivalents
Accretion expense	1,675,271	1,727,964
Depreciation of property and equipment	2,781,873	1,552,165
Amortization of intangible assets	-	1,676,532
Depreciation of right of use assets	2,848,585	-
Amortization of lease inducement	-	38,511
Accretion of lease liability	1,734,100	-
Loss on lease termination	481,480	-
Interest expense paid by shares	846,000	881,504
Issuance of warrants	305,455	129,955
Issuance of shares for contract settlement	-	72,900
Share-based compensation	596,747	963,891
Loss on disposal of assets	(4,910)	84,418
Term loan restructuring loss	547,553	-
Term loan – non-cash interest adjustment	44,782	-
Gain on investment	(1,122,544)	(597,864)
Gain on bargain purchase	(520,947)	-
Loss on revaluation of financial asset	247,595	-
Share of loss on equity investment	-	97,797
Impairment Loss	23,421,506	3,827,011
Income tax recovery	(1,466,787)	(2,824,630)
Cash flows from discontinued operations	554,022	9,096,397
	(4,560,459)	(15,350,051)
Changes in non-cash working capital related to operations
Trade and other receivables	(1,371,996)	135,883
Inventory	3,685,122	(6,085,355)
Prepaid expenses	306,452	(2,619,641)
Trade and otherpayables	(305,741)	1,876,775
Cash flows used in operatingactivities	(2,246,622)	(22,042,389)
Investing Activities
Investments	-	(78,068)
Proceeds from sale of equity investment	100,871	-
Proceeds from sale of 11522302 Canada Inc.	1,235,000	-
Acquisition of 11522302 Canada Inc., net of cash acquired	(385,802)	-
Acquisition of Bud & Sally, net of cash acquired	(1,132,882)	-
Acquisition of New Leaf Emporium, net of cash acquired	-	(1,197,888)
Acquisition of The Green Company Ltd - cash returned from escrow	501,965	(4,958,771)
Loan receivable	(1,710,924)	-
Acquisition of assets in process	(580,760)	(2,887,352)
Acquisition ofpropertyand equipment	(429,586)	(9,128,337)
Cash flows used in investingactivities	(2,402,118)	(18,250,416)
Financing Activities
Issuance of debt financing	4,000,000	9,000,000
Repayment of debt financing	-	(25,000,000)
Issuance of share capital	10,000,012	20,000,000
Issuance of convertible debentures	-	21,150,000
Issuance costs – convertible debentures	-	(905,170)
Lease liability payments	(3,976,056)	-
Lease termination fees	(469,495)	-
Exercise of warrants	-	35,018
Exercise of options	-	483,750
Share issuance costs	(1,283,347)	(618,176)
Shareholder Loans	-	180,000
Cash flowsprovided byfinancingactivities	8,271,114	24,325,422
Net increase (decrease) in cash and cash equivalents	3,622,374	(15,967,383)
Cash and cash equivalents,beginningofperiod	7,528,849	23,496,232
Cash and cash equivalents, end ofperiod	$ 11,151,223	$ 7,528,849

The accompanying notes are an integral part of these Consolidated Financial Statements.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

1. NATURE OF OPERATIONS

At the Company’s annual and special meeting of shareholders held on February 19, 2020 (the “Meeting”), a special resolution was passed to change the name of the Company from National Access Cannabis Corp. to Meta Growth Corp. Subsequent to the Meeting, all filings and approvals were obtained, and the Company’s name was officially changed to Meta Growth Corp. (“META” or the “Company”). The Company, formerly Brassneck Capital Corp., was incorporated under the name Brassneck Capital Corp. pursuant to the provisions of the Business Corporations Act (Alberta) on June 18, 2015. The head office of the Company is located at Suite 200, 56 Aberfoyle Crescent, Toronto, Ontario M8X 2W4. The registered office of the Company is located at 1900, 520 3rd Avenue SW, Calgary, Alberta, Canada T2P 0R3.

The Company’s common shares are listed on the TSX Venture Exchange (“TSXV”), under the trading symbol “META”.

The Company and its subsidiaries are in the business of operating retail locations to sell and distribute cannabis and cannabis related products, effective October 2018 with the Cannabis Act coming into force.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The consolidated financial statements for the year ended August 31, 2020 do not reflect adjustments that would be necessary if the going concern basis was not appropriate. Consequently, adjustments would then be necessary to the carrying values of assets and liabilities, the reported revenues and expenses and the balance sheet classifications used. Such adjustments, if required, could be material.

2.1 Statement of Compliance

The Company's consolidated financial statements have been prepared in accordance with and using accounting policies in compliance with International Financial Reporting Standards ("IFRS") issued by the International Accounting Standards Board ("IASB") and interpretations of the International Financial Reporting Interpretations Committee ("IFRIC") and in effect at the closing date of August 31, 2020.

The accounting policies applied in the preparation of the consolidated financial statements for the years ended August 31, 2020 and 2019 are set out below.

These consolidated financial statements were approved and authorized for issue by the Board of Directors on December 17, 2020.

2.2 Basis of measurement

The consolidated financial statements, presented in Canadian dollars, have been prepared on a historical cost basis, except for cash, derivate assets and investments. Stock options and warrants are initially measured at fair value and subsequently carried at historical cost.

The accounting policies set out below have been applied consistently by the Company and its wholly owned subsidiaries for the periods presented.

2.3 Basis of consolidation

The consolidated financial statements include the financial results of the Company and its subsidiaries. Subsidiaries include entities which are wholly-owned as well as entities the Company has the authority or ability to exert power over the investee's financial and operating decisions, which in turn may affect the Company's exposure or rights to variable returns from the investee. The consolidated financial statements

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

include the operating results of acquired entities from the date control commences until the day control ceases. Non-controlling interest in the equity of the Company's subsidiaries are shown separately in equity in the consolidated statements of financial position. All intercompany balances and transactions are eliminated upon consolidation.

The functional currency of the parent and all subsidiaries is the Canadian dollar, which is the presentation currency of the consolidated financial statements.

The operating subsidiaries the Company has control over are as follows:

Subsidiaries	Percentage Ownership
National Access Canada Corporation	100%
NAC Southern Alberta Ltd.	100%
META West Coast Ltd.	100%
NAC Ontario Ltd.	100%
The Green Company Limited	100%
National Access Cannabis Management Corp	100%
NAC Northern Alberta Limited Partnership	100%
National Access Cannabis Medical Inc.	51%
NAC Bio Inc.	57.1%
NAC Thompson North Limited Partnership	49%
NAC Long Plain Limited Partnership	49%
NAC OCN Limited Partnership	49%
NAC Arrowhead Limited Partnership	49%
2713865 Ontario Ltd.	100%
2208292 Alberta Ltd.	100%

2.4 Investments accounted for using the equity method

Investments accounted for using the equity method include investments in joint arrangements representing joint ventures. A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the joint arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require unanimous consent of the parties sharing control. The Company accounts for its investments in joint ventures using the equity method of accounting. Under the equity method, investments in joint ventures are initially recognized in the consolidated statements of financial position at cost, and subsequently adjusted for the Company’s share of the net income (loss). The carrying value is assessed for impairment at each statement of financial position date.

The Company’s investment in Tetra Pty Ltd. is accounted for as a joint venture, which was disposed of on May 29, 2020. As at August 31, 2020 there are no other joint ventures.

2.5 Cash and cash equivalents

Cash and cash equivalents include cash on hand, cash balances with banks, all highly liquid short-term deposits with original terms to maturity at the date of acquisition of 90 days or less.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

2.6 Inventory

Inventory is valued at the lower of cost and net realizable value. Cost of inventories is measured at weighted average cost. Cost includes the acquisition cost at the date of purchase and costs directly attributable to bringing the inventory to the location and condition necessary for distribution to customers. Net realizable value is the estimated selling price, in the ordinary course of business, less appropriate selling and distribution expenses. When inventory is sold, the carrying amount of the inventory is recognized as an expense in cost of goods sold in the period in which the related revenue is recognized.

2.7 Property and equipment

Property and equipment are carried at historical cost less any accumulated depreciation and impairment losses. Historical cost includes the acquisition cost or production cost as well as the costs directly attributable to bringing the asset to the location and condition necessary for its use in operations. When property and equipment include significant components with different useful lives, they are recorded and depreciated separately. Estimated useful lives are reviewed at the end of each reporting period.

The Company recognizes in the carrying amount of an item of property and equipment the cost of replacing part of such an item when that cost is incurred if it is probable that the future economic benefits embodied with the item will flow to the Company and the cost of the item can be measured reliably. All other costs are recognized in the statement of net loss and comprehensive loss as an expense as incurred. Depreciation is not recorded on property and equipment that is not yet available for use.

Depreciation is provided at rates calculated to write off the cost of property and equipment less their estimated residual values using the straight-line method, over the estimated useful lives, as follows.

Furniture and equipment	5 years
Electronic equipment	3 years
Signs	5 years
Leasehold improvements	Lesser of the term of the lease and useful life
Right of use assets	Term of the lease

Borrowing costs that are directly attributable to the acquisition or construction of a qualifying asset are capitalized. The rate for calculating the capitalized financing cost is based on the Company’s weighted average cost of borrowing experienced during the reporting period.

2.8 Intangible assets

Intangible assets with finite useful lives are reported at cost less accumulated amortization and accumulated impairment losses. Amortization is recognized on a straight-line basis over their estimated useful lives. The estimated useful life and amortization method are reviewed at the end of each annual reporting period, with the effect of any changes in estimate being accounted for on a prospective basis.

Intangible assets with indefinite useful lives are comprised of acquired service contracts and retail cannabis licenses which are carried at cost less accumulated impairment losses. These intangible assets are tested for impairment on an annual basis or more frequently if there are indicators that intangible assets may be impaired.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

2.9 Goodwill

Goodwill arising in a business combination is recognized as an asset at the date control is acquired (acquisition date). Goodwill is measured as the excess of the cost of the acquisition over the Company’s interests in the net fair value of the identifiable assets, liabilities, and contingent liabilities of the acquiree recognized at the date of acquisition.

For the purposes of assessing impairment, goodwill is allocated to cash-generating units or groups of cashgenerating units that are expected to benefit from the synergies of the combination. Each cash-generating unit to which goodwill is allocated represents the lowest level at which cash flows are largely independent from cash flows of other assets or groups of assets. The impairment of non-financial assets in Note 2.10 describes how goodwill is tested for impairment.

2.10 Impairment

The Company assesses at each date of the statement of financial position whether a non-financial asset is impaired.

Property and equipment, and definite life intangibles are reviewed for impairment at the end of each financial reporting period or whenever events or changes in circumstances indicate that the carrying amount of the asset or related cash generating unit ("CGU") may not be recoverable. If any such indication exists, then the asset’s or CGU's recoverable amount is estimated.

Goodwill and indefinite life intangible assets are tested annually for impairment by comparing the carrying value of each CGU containing the assets to its recoverable amount. The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. In assessing the value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate. The discount factors are determined individually for each CGU and reflect their respective risk profiles as assessed by management. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets.

An impairment loss is recognized if the carrying amount of an asset or CGU exceeds the estimated recoverable amount. Impairment losses are recognized in the statement of net loss and comprehensive loss. Impairment losses recognized in respect of CGUs are allocated to reduce the carrying amounts of assets in the CGU on a pro-rata basis. Impairment losses may be reversed in a subsequent period where the impairment no longer exists or has decreased. An impairment loss for goodwill is never reversed. The carrying amount after a reversal must not exceed the carrying amount (net of depreciation or amortization) that would have been determined had no impairment loss been recognized. A reversal of impairment loss is recognized in the statement of net loss and comprehensive loss.

An impairment loss in respect of a financial asset measured at amortized cost is recognized where any expected future credit losses are provided for, irrespective of whether a loss event has occurred as at the reporting date.

2.11 Business combinations

Business combinations are accounted for using the acquisition method under IFRS 3, Business Combinations (IFRS 3). The consideration transferred by the Company to obtain control of an entity is calculated as the sum of the acquisition-date fair values of assets transferred, liabilities incurred and the

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

equity interests issued by the Company, which includes the fair value of any asset or liability arising from a contingent consideration arrangement. Acquisition costs are expensed as incurred.

The Company recognizes identifiable assets acquired and liabilities assumed, including contingent liabilities, in a business combination regardless of whether they have been previously recognized in the acquiree's financial statements prior to the acquisition. Assets acquired and liabilities assumed are generally measured at the acquisition-date fair values. Goodwill is stated after separate recognition of identifiable assets. It is calculated as the excess of the sum of (a) fair value of consideration transferred, (b) the recognized amount of any non-controlling interest in the acquiree and (c) acquisition-date fair value of any existing equity interest that the Company has in the acquiree, over the acquisition-date fair values of identifiable net assets. If the fair value of identifiable net assets exceeds the sum calculated above, the excess amount (i.e. gain on a bargain purchase) is recognized in the statement of net loss and comprehensive loss immediately.

2.12 Comprehensive income (loss)

Comprehensive income (loss) is the change in the Company’s net assets that results from transactions, events, and circumstances from sources other than the Company’s shareholders and includes items that are not included in net profit such as unrealized gains or losses on available for sale investments and gains or losses on certain derivative instruments.

2.13 Share based payments

Share based payment transactions

Employees (including directors and senior executives) of the Company receive a portion of their remuneration in the form of share-based payment transactions, whereby they render services as consideration for equity instruments (“equity-settled transactions”).

In situations where equity instruments are issued to non-employees and some or all of the goods or services received by the Company as consideration cannot be specifically measured, they are measured at fair value of the share-based payment. The fair value of the share-based payments is recognized together with a corresponding increase in equity over a period that services are provided or goods are received.

Equity settled transactions

The costs of equity settled transactions with employees are measured by reference to the fair value at the date on which they are granted using the Black-Scholes option pricing model.

The costs of equity settled transactions are recognized, together with a corresponding increase in equity, over the period in which the performance and/or service conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award (“the vesting date”). The cumulative cost is recognized for equity-settled transactions at each reporting date until the vesting date reflects the Company’s best estimate of the number of equity instruments that will ultimately vest. The profit or loss charge or credit for a period represents the movement in cumulative expense recognized as at the beginning and end of that period and the corresponding amount is represented in contributed surplus.

No expense is recognized for awards that do not ultimately vest.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

2.14 Loss per share

The Company presents basic and diluted loss per share data for its common shares, calculated by dividing the loss attributable to common shareholders of the Company by the weighted average number of common shares outstanding during the period. Diluted loss per share is determined by adjusting the loss attributable to common shareholders and the weighted average number of common shares outstanding for the effects of all options and warrants outstanding that may add to the total number of common shares.

2.15 Income taxes

Income tax expense consists of current and deferred tax expense. Current and deferred tax expense are recognized in the statement of net loss and comprehensive loss except to the extent that they relate to items recognized directly in equity or other comprehensive income (loss).

Current tax is recognized and measured at the amount expected to be recovered from or payable to the taxation authorities based on the income tax rates enacted at the end of the reporting period and includes any adjustment to taxes payable in respect of previous years.

Deferred tax is recognized on any temporary differences between the carrying amounts of assets and liabilities in the consolidated financial statements and the corresponding tax basis used in the computation of taxable earnings (loss). Deferred tax assets and liabilities are measured using enacted or substantively enacted tax rates that are expected to apply in the period when the asset is realized or the liability is settled. The effect of a change in the enacted or substantively enacted tax rates is recognized in net loss, comprehensive income (loss) or in equity depending on the item to which the adjustment relates. Deferred tax assets are recognized to the extent future recovery is probable. At each reporting period end, deferred tax assets are reduced to the extent that it is no longer probable that sufficient taxable earnings will be available to allow all or part of the asset to be recovered.

2.16 Equity

Share capital

Share capital represents the amount received on the issuance of common shares. Transaction costs directly attributable to the issuance of common shares are recognized as a reduction of share capital. If shares are issued when options or warrants are exercised, the share capital account also comprises the compensation costs previously recorded as contributed surplus or warrants. In addition, if common shares are issued as consideration for the acquisition of non-monetary assets, they are measured at the fair value of the assets or services received unless that fair value cannot be estimated reliably. If the Company cannot estimate reliably the fair value of the assets or services received, the common shares are measured at the fair value of the shares issued.

Warrants

Warrants include charges related to the issuance of warrants until such equity instruments are exercised.

In the event that the Company reacquires its own warrants, they are held by the Company until the time they are transferred or cancelled.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Contributed surplus

Contributed surplus includes charges related to stock-based compensation until such equity instruments are exercised, as well as expired or forfeited warrants.

2.17 Revenue Recognition

Revenue recognition is based on a 5-step approach which includes identifying the contract with the customer, identifying the performance obligations, determining the individual transaction price, allocating the transaction price to the performance obligations in the contract and recognizing revenue when the relevant performance obligations are satisfied. Revenue is recognized when the entity satisfies the performance obligation upon delivery and acceptance by the customer.

Revenue in the Financial Statements is disaggregated into retail revenue, retail management services and other revenue.

Revenue from cannabis, merchandise and accessory sales are recognized at point of sale when the customer takes control of the goods in an amount that reflects the consideration the Company expects to receive in exchange for the goods. The Company considers its performance obligation to be satisfied at the point of sale.

Cannabis retail sales in the province of Manitoba are subject to a social responsibility fee, equal to 6% of recreational cannabis sales effective January 1, 2019. These fees are levied on the Company and are a transaction cost that is directly attributable to revenue earned and are recorded in cost of sales.

2.18 Leases

At the lease possession date, the Company recognizes a lease liability reflecting its obligation for future lease payments and a right of use asset representing its right to use the underlying asset.

Right of use assets and lease liabilities are presented in the consolidated statement of financial position and are measured at the present value of future lease payments discounted at the Company’s incremental borrowing rate. Lease payments included in the measurement of the lease liability are made up of fixed payments and variable lease payments that are based on an index or rate.

Right of use assets are amortized on a straight-line basis over the lease term and accretion expense is recognized on lease liabilities using the effective interest method. The Company also assesses the right of use asset for impairment when such indicators exist.

2.19 Financial Instruments

Classification and measurement

The classification and measurement of financial assets is based on the Company’s assessment of its business model for holding financial assets and the contractual terms of the cash flows. All financial assets and financial liabilities, including derivatives, are recognized at fair value on the consolidated statements of financial position when the Company becomes party to the contractual provisions of the contract.

Financial assets are classified and measured at either amortized cost, at fair value through profit or loss (“FVTPL”), or fair value through other comprehensive income (“FVTOCI”). Financial assets are derecognized when the contractual rights to the cash flows from the financial asset expire or when the contractual rights to those assets are transferred.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Impairment of financial assets

At each reporting date, the Company assesses whether a financial asset or group of financial assets is impaired under the expected credit loss model. The expected credit loss model requires an entity to account for expected credit losses and changes in those expected credit losses at each reporting date to reflect changes in credit risk since initial recognition. For trade receivables, the Company has applied the simplified approach under IFRS 9 and has calculated expected credit losses based on lifetime expected credit losses taking into considerations historical credit loss experience and financial factors specific to the debtors and general economic conditions

2.20 Critical accounting estimates and judgments

The Company's consolidated financial statements are prepared in accordance with IFRS recognition and measurement principles that often require Management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts presented and disclosed in the consolidated financial statements. Management reviews these estimates and assumptions on an ongoing basis based on historical experience, changes in business conditions and other relevant factors as it believes to be reasonable under the circumstances. Changes in facts and circumstances may result in revised estimates, and actual results could differ from those estimates. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.

Estimates

Useful lives of depreciable assets

The useful lives of depreciable assets have been determined based on management’s estimated utility of the assets. Uncertainties in these estimates relate to technological obsolescence that may change the utility of certain electronic equipment.

Useful lives of intangible assets

The useful lives of intangible assets have been determined based on management’s estimated attrition rates related to the associated asset. Any subsequent change in these estimates would affect the amount of amortization recorded over future periods.

Fair value of investments

Investments are measured at fair value. In estimating fair value, the Company uses market-observable data to the extent it is available. The Company uses a fair value hierarchy in order to classify the fair value measurements and disclosures related to the Company’s financial assets and financial liabilities. The fair value hierarchy has the following levels:

Level 1 – Quoted market prices in active markets for identical assets or liabilities. Level 2 – Inputs other than quoted market prices included in Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices); and Level 3 – Unobservable inputs such as inputs for the asset or liability that are not based on observable market data.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

The level in the fair value hierarchy within which the fair value measurement is categorized in its entirety is determined on the basis of the lowest level input that is significant to the fair value measurement in its entirety. For financial assets and liabilities that are valued at other than fair value on its balance sheets (i.e., deposits in GIC which are presented in cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities), fair value approximates their carrying value at each balance sheet date due to their short-term maturities.

Share-based compensation and warrants

The estimation of share-based compensation and warrants requires the selection of an appropriate valuation model and consideration as to the inputs necessary for the valuation model chosen. The Company has made estimates as to the volatility of its own shares, the expected life of share options and warrants granted and the time of exercise of those options and warrants. The model used by the Company is the Black-Scholes valuation model.

Income taxes

Provisions for taxes are made using the best estimate of the amount expected to be paid based on a qualitative assessment of all relevant factors. The Company reviews the adequacy of these provisions at the end of the reporting period. However, it is possible that at some future date an additional liability could result from audits by taxing authorities. Where the final outcome of these tax  related matters is different from the amounts that were initially recorded, such differences will affect the tax provisions in the period in which such determination is made.

Inventory

Inventory is carried at the lower of cost and net realizable value. In estimating net realizable value, the Company considers the impact of obsolescence, price fluctuations and fluctuations in inventory levels and demand.

Expected credit losses

Accounts receivable are typically short-term in nature and the Company applies the simplified model in assessing and recognizing an amount equal to the lifetime expected credit losses. The Company recognizes a loss allowance based on lifetime expected credit losses at each reporting date from the date of the trade receivable.

Judgments

Assessing the probability of utilizing deferred tax assets

Deferred tax assets are recognized for unused tax losses and credits to the extent that it is probable that taxable income will be available against which the losses can be utilized. These estimates are reviewed at every reporting date. Information about assumptions and estimation based upon the likely timing and the level of the reversal of existing timing differences, future taxable income and future tax planning strategies, is included in Note 26. The tax rules in the numerous jurisdictions in which the Company operates are also taken into consideration.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Goodwill impairment

The Company performs an annual test for impairment for each of the cash generating units (CGUs with goodwill allocated), and whenever events or circumstances make it more likely than not that an impairment may have occurred, such as a significant adverse change in the business climate or a decision to sell or dispose of all or a portion of a reporting unit. Determining whether an impairment has occurred requires valuation of the respective CGU, which is estimated using a discounted cash flow method. When available and as appropriate, comparative market multiples are used to corroborate discounted cash flow results. In applying this methodology, a number of factors are relied upon, including actual operating results, future business plans, economic projections and market data.

Cash-generating units

Assets are grouped into CGUs at the lowest level of separately identified cash flows. The determination of a CGU is based on management’s judgment and is an assessment of the smallest group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets. The Company’s CGUs are the individual retail locations.

Business combinations

In a business combination, all identifiable assets, liabilities, and contingent liabilities acquired are recorded at their fair values. One of the most significant estimates relates to the determination of the fair value of these assets and liabilities. For any intangible asset identified, depending on the type of intangible asset and the complexity of determining its fair value, an independent valuation expert or management may develop the fair value, using approximate valuation techniques, which are generally based on a forecast of the total expected future cash flows. The evaluations are linked closely to the assumptions made by management regarding the future performance of the assets concerned and any changes in the discount rate applied. Certain fair values may be estimated at the acquisition date pending confirmation or completion of the valuation process. When provisional values are used in accounting for a business combination, they may be adjusted retrospectively in subsequent periods. However, the measurement period will last for up to one year from the acquisition date.

COVID-19

The Company’s business could be significantly adversely affected by the effects of the recent outbreak of novel coronavirus (“COVID-19”). Several significant measures have been implemented in Canada and the rest of the world in response to the increased impact from COVID-19. The Company cannot accurately predict the impact COVID-19 will have on third parties’ ability to meet their obligations with the Company, including due to uncertainties relating to the ultimate geographic spread of the virus, the severity of the disease, the duration of the outbreak, and the length of travel and quarantine restrictions imposed by governments of affected countries. In particular, the continued spread of COVID-19 globally could materially and adversely impact the Company’s business including without limitation, employee health, workplace productivity, and other factors that will depend on future developments beyond the Company’s control. In addition, a significant outbreak of contagious diseases in the human population could result in a widespread health crisis that could adversely affect the economies and financial markets of many countries resulting in an economic downturn that could negatively impact the Company’s financial position, financial performance, cash flows, and its ability to raise capital. Since the initial outset of the pandemic, the Company did not experience a significant decline in sales for most of the retail operating stores. For those

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

stores that did experience a decline in sales, the Company applied for the Canada Emergency Wage Subsidy, which has been recognized in other income in the consolidated statements of net loss. The effects of COVID-19 are changing rapidly, and the consequences cannot be reasonably estimated at this time but could have material adverse effects on the Company’s operations.

2.21 Segmented information

As of August 31, 2020, the Company’s retail cannabis stores constituted the only remaining reportable segment that is included in the results of continuing operations due to the divestiture of the medical cannabis education segment.

Subsequent to the disposal of the medical cannabis education segment during the year ended August 31, 2020, management reviewed its current continuing operations using the criteria stated in IFRS 8 – Operating Segments and determined that the Company has one reportable segment based on the operating results of business activities with discrete financial information that is regularly reviewed by the Company’s chief operating decision maker for the purpose of resource allocation and assessing performance. The results of the medical cannabis education segment are presented in discontinued operations and are presented in Note 8.

2.22 Discontinued operations

Non-current assets and disposal groups are classified and presented as discontinued operations if the assets or disposal groups are disposed of or classified as held for sale and the assets or disposal groups are a major line of business or geographical area of operations.

The results of discontinued operations are shown separately in the consolidated statements of net loss and comprehensive loss and comparative figures are reclassified in order to conform with the current year’s basis of presentation.

3. ADOPTION OF NEW STANDARDS

(i) IFRS 16, Leases

On September 1, 2019, the Company adopted IFRS 16 – Leases. The new standard has significant changes to the lessee accounting by removing the distinction between operating and finance leases and requires lessees to recognize a lease liability reflecting its obligation for future lease payments and a right of use asset representing its right to use the underlying asset.

The Company has applied IFRS 16 using the modified retrospective approach. Under this approach comparative information has not been restated and continues to be reported under IAS 17. The Company has elected to use the following practical expedients in transitioning to IFRS 16:

• The Company has applied a single discount rate to a portfolio of leases with reasonably similar characteristics.

• The Company has elected to not include the initial direct costs associated with the lease in calculating the opening right of use asset.

• The Company has elected not to account for leases for which the lease term ends within 12 months as short-term leases.

• The Company has elected to record the right of use asset at an amount equal to the lease liability adjusted for prepaid or accrued lease payments.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

3. ADOPTION OF NEW STANDARDS (continued)

Under IFRS 16, the Company has applied the following treatment to all leases:

• Right of use assets and lease liabilities are presented in the consolidated statement of financial position and are measured at the present value of future lease payments discounted at the Company’s incremental borrowing rate at the date of adoption.

• Right of use assets are amortized on a straight-line basis over the lease term and accretion expense is recognized on the lease liabilities using the effective interest method. Amortization of right of use assets and accretion expense are recognized in the consolidated statement of net loss and comprehensive loss.

• Total amount of cash paid, including both the principal and interest are presented in financing activities in the consolidated statement of cash flows.

The Company’s weighted average incremental borrowing rate at the date of transition on September 1, 2019 was approximately 14.79%. At the date of transition, the Company recognized right of use assets of $12,599,918 and lease liabilities of $12,216,478. The Company capitalized prepaid lease deposits and lease inducements amounting to $383,440 to right of use assets on September 1, 2019 in accordance with IFRS 16.

A reconciliation of lease commitments as at September 1, 2019, outlining the impact of the transition to IFRS 16 is outlined below.

Operating lease commitments at August 31, 2019 Variable lease payments not recognized Present value adjustment at September 1, 2019 Lease liability recognized at September 1, 2019	19,940,698 (1,235,949) (6,488,271) 12,216,478

4. CASH AND CASH EQUIVALENTS

The Company’s cash and cash equivalents consist of the following:

Operating Cash Guaranteed Investment Certificates	August 31 2020 August 31 2019
	10,206,223 6,678,849 945,000 850,000
	11,151,223 7,528,849

5. TRADE AND OTHER RECEIVABLES

The Company’s trade and other receivables consist of the following:

Trade and other receivables Accrued consideration – Tetra disposition (Note 9) Accrued consideration – 11522302 Canada Inc. (Note 17) Sales taxes recoverable	August 31 2020 August 31 2019
	901,646 211,263 34,858 - 1,035,000 - 306,478 550,756
	2,277,982 762,019

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

6. INVENTORY

Inventory consists of cannabis inventory and merchandise and accessories at retail locations which have been granted licenses.

Cannabis inventory Merchandise and accessories	August 31 2020 August 31 2019
	2,412,594 717,052 5,939,276 410,046
	3,129,646 6,349,322

During the year ended August 31, 2020, $37,602,744 of inventory was recognized as an expense ($36,240,391 for the year ended August 31, 2019). The Company recognized an inventory impairment of $301,100 for the year ended August 31, 2020 (August 31, 2019 - $Nil).

7. PREPAID EXPENSES

The Company’s prepaid expenses consist of the following:

Prepaid inventory Prepaid lease deposits Other deposits	August 31 2020 August 31 2019
	694,304 178,468 1,396,245 1,032,579 2,291,117 1,683,637
	3,163,889 4,112,461
Presented as:	3,163,889 3,201,252 - 911,209
Current prepaid expenses
Long-term lease deposits
	3,163,889 4,112,461

The significant decrease is due to the reclassification of prepaid lease deposits to the right of use assets in accordance with IFRS 16.

8. DISCONTINUED OPERATIONS AND DISPOSALS

a) National Access Cannabis Medical Inc.

On March 6, 2020, National Access Cannabis Medical Inc. (“NACM”) entered into an Asset Purchase Agreement to sell certain assets of its pharmacy business to The Clinic Network Canada Inc. (“TCNC”) for total proceeds of up to $1,200,000.

The total proceeds are payable to NACM as per the following terms: i) At the closing date, TCNC issued a note payable in the amount of $200,000 to NACM which shall be converted into TCNC common shares at the conversion price upon the occurrence of a liquidity event. The conversion price is the lower of $10,856 or the market value, on a per TCNC common share basis. If no such event occurs within 18 months of the closing date, the note shall be paid in cash, and ii) On each of the first three anniversaries of the closing date, if the gross revenue received in connection with the sale of cannabis under the NACM’s contracts during each of such twelve month periods exceeds $5,400,000, NACM will receive 5% of gross revenue received in that year, payable in TCNC common shares (“bonus payment”). The maximum aggregate bonus payment over the 3 subsequent years shall be $1,000,000.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

8. DISCONTINUED OPERATIONS AND DISPOSALS (continued)

In connection with the sale of assets, the shareholders of 2627639 Ontario Inc. and 2627786 Ontario Inc. that collectively have a 49% equity interest in NACM entered into a Release Agreement whereby the shareholders agreed to waive any right or entitlement to the sale proceeds and have discharged NACM from all debts which the entities had against the Company. As a result, the Company recognized a $410,000 gain on debt forgiveness for the year ended August 31, 2020.

The total fair value of the base consideration received amounted to $162,082, representing the amount of cash or share consideration the Company will receive within 18 months following the closing date, using a 15 percent discount rate. As the variable component of the transaction price cannot be determined at the inception of the contract due to the uncertainty, no amounts have been recognized and management will reassess the transaction price at each reporting period. For the year ended August 31, 2020, the Company recognized a gain on sale of assets amounting to $162,082. The total carrying value of all assets disposed of was $Nil at the date of disposition.

b) Medical Clinic Operations

On June 15, 2020, the Company entered into an asset purchase agreement to sell the medical clinics assets from National Access Canada Corporation to TCNC for total gross proceeds of up to $800,000. The total proceeds are payable as per the following terms: i) Cash paid on the closing date amounting to $500,000, and ii) A performance component totaling a maximum of $300,000 based on $42 per patient that renews his or her annual medical document within 12 months after closing. The fair value of the performance component amounts to $150,000 based on management’s assessment of the likelihood of achieving the milestones at the date of disposition. The amounts are payable in shares of the purchaser if the shares are listed on a public exchange within 12 months of closing. Otherwise, the performance component shall be paid in cash. An impairment loss of $833,498 on the carrying amount of goodwill was recorded during the period ending May 31, 2020 as a result of measuring the assets held for sale at the lower of cost and fair value less costs to sell. The impairment loss was recognized in discontinued operations during the period. For the year ended August 31, 2020, there was no gain or loss recognized on disposition as a result of the impairment loss.

c) Discontinued Operations

For the year ended August 31, 2020, the Company’s Medical Cannabis Education operating segment met the criteria for presentation as discontinued operations, as a result of asset purchase agreements for NACM and the medical clinic business. As such, the comparative consolidated statements of net loss and comprehensive loss for the years ended August 31, 2020 and August 31, 2019 have been presented to show the discontinued operations separate from the continuing operations of the Company. The results of discontinued operations are presented below:

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

8. DISCONTINUED OPERATIONS AND DISPOSALS (continued)

	Year Ended	August 31
	2020	2019
Revenues	$ 592,317	$ 1,240,062
Cost of Goods Sold	109,533	205,500
Gross Profit	$ 482,784	$ 1,034,562
Expenses
Advertising and marketing	1,571	103,615
Depreciation of property and equipment (Note 10)	111,120	159,549
Depreciation of right of use assets (Note 12)	117,477	-
Finance and other costs (Note 22)	3,888	-
Impairment loss	833,498	13,000,784
Loss on disposal of assets	60,122	16,064
Recovery of contingent liability	-	(4,080,000)
General and administrative expenses	1,332,948	2,031,114
	$2,460,624	$11,231,125
Loss from discontinued operations	(1,977,840)	(10,196,563)
(Gain) on disposal of discontinued operations
Gain on disposal of assets	(162,082)	-
Gain on debt forgiveness	(410,000)	-
	(572,082)	-
Net loss for theperiod from discontinued operations	(1,405,758)	(10,196,563)

9. INVESTMENTS

On May 29, 2020, the Company sold its common shares in Tetra Pty Ltd. to THC Global Group Limited (“THC”). Upon closing of the transaction, the Company received AU$75,000 in cash, 1,350,000 THC shares, and 1,500,000 stock options in THC exercisable at AU$0.40 expiring two years after issue. Both the shares and stock options are subject to a 12 month hold period from the date of issue. THC is a publicly traded entity listed on the Australian Securities Exchange under the symbol THC. The closing price of THC’s shares on May 29, 2020 was AU$0.39.

The Company received further proceeds in two additional tranches as follows:

• i) Three months after closing date: AU$37,500 in cash, and AU$225,000 in THC shares, with the issue price calculated as the lower of 105% of the 10-trading day VWAP prior to issue date or AU$0.35.

• ii) Six months after closing date: AU$37,500 in cash, and AU$187,500 in THC shares, with the issue price calculated as the lower of 105% of the 10-trading day VWAP prior to issue date or AU$0.40.

Upon initial recognition, the fair value of the consideration received amounted to $1,122,544, as follows: i) $66,255 in cash consideration received upon closing, ii) $65,215 in future cash consideration, iii) $841,735 in THC shares, and iv) $149,339 in THC stock options. The carrying value of the Company’s investment in Tetra Pty Ltd. at the date of disposition amounted to $Nil, resulting in a gain on disposal of investment of $1,122,544 for the year ended August 31, 2020. The fair value of the THC shares amounting to $841,735 has been recognized as a financial asset using Level 1 inputs, based on the trading price of THC’s shares. The future share consideration has been discounted back using a rate of 15%. The stock options received

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

9. INVESTMENTS (continued)

were recorded at a fair value of $149,339 based on a Black-Scholes option pricing model, with an exercise price of AU$0.40, an expected life of two years, volatility of 51.75%, and a risk-free rate of 0.28%.

As at August 31, 2020, the financial assets have been remeasured at fair value through profit and loss as follows: i) $34,858 in future cash consideration, ii) $696,205 in THC shares, and iii) $43,016 in THC stock options. The stock options received were remeasured based on a Black-Scholes option pricing model, with an exercise price of AU$0.235, an expected life of two years, volatility of 51.75%, and a risk-free rate of 0.28%. As a result, the Company has recognized a $247,595 loss on revaluation of financial assets in the statement of net loss and comprehensive loss.

10. PROPERTY AND EQUIPMENT

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Furniture
And Electronic Information Leasehold
Equipment Equipment panels Signs Improvements Total
Cost:
----- End of picture text -----

At August 31, 2018 Additions Additions from business combination Transferred from assets in process Disposals At August 31, 2019 Additions Additions from business combination (Note 17) Transferred from assets in process Disposals Impairment (Note 14) At August 31, 2020 Accumulated Depreciation At August 31, 2018 Depreciation – continuing Depreciation - discontinued Disposals At August 31, 2019 Depreciation – continuing Depreciation - discontinued Disposals At August 31, 2020 Net carrying amounts: At August 31, 2019 At August 31, 2020	168,832 193,232 14,233 64,368 636,743 1,077,408 786,103 2,378,063 - 164,319 5,799,852 9,128,337 26,494 547,113 - 30,741 1,471,488 2,075,836 3,917 53,565 - - 709,994 767,476 (20,755) (7,884) - (18,103) (12,646) (59,388)
	964,591 3,164,089 14,233 241,325 8,605,431 12,989,669
	103,062 122,328 - 22,726 181,470 429,586 122,264 89,732 - 19,494 720,772 952,262 29,594 269,568 - 44,808 824,544 1,168,514 (171,818) (276,806) (14,233) (60,125) (974,493) (1,497,475) (181,109) (763,284) - (91,618) (2,625,477) (3,661,488)
	866,584 2,605,627 - 176,610 6,732,247 10,381,068
	57,955 59,450 14,233 26,768 528,623 687,029 116,669 526,690 - 24,245 884,561 1,552,165 20,684 59,121 - 10,830 68,914 159,549 (12,492) (7,359) - (10,303) (540) (30,694)
	182,816 637,902 14,233 51,540 1,481,558 2,368,049
	179,679 1,018,254 - 47,086 1,536,854 2,781,873 13,487 49,209 - 6,099 42,325 111,120 (69,872) (129,558) (14,233) (30,836) (651,267) (895,766)
	306,110 1,575,807 - 73,889 2,409,470 4,365,276
	781,775 2,526,187 - 189,785 7,123,873 10,621,620
	560,474 1,029,820 - 102,721 4,322,777 6,015,792

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

11. ASSETS IN PROCESS

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Furniture
And Electronic Leasehold
Equipment Equipment Signs Improvement Total
Cost:
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At August 31, 2018 Additions Additions from business combination Transferred between categories Transferred to property and equipment Disposals At August 31, 2019 Additions Transferred between categories Transferred to property and equipment Disposals Impairment (Note 14) At August 31, 2020 Carrying amounts: At August 31, 2019 At August 31, 2020	3,917 53,565 - 1,283,595 1,341,077 95,625 696,889 89,955 2,004,883 2,887,352 - 53,841 7,481 117,162 178,484 3,072 - - (3,072) - (3,917) (53,565) - (709,994) (767,476) (1,129) (1,862) (1,660) (67,137) (71,788)
	97,568 748,868 95,776 2,625,437 3,567,649
	12,782 35,688 - 532,290 580,760 - 11,500 - (11,500) - (29,594) (269,568) (44,808) (824,544) (1,168,514) (9,083) (89,416) (4,374) (387,396) (490,269) (26,515) (215,257) (7,873) (461,897) (711,542)
	45,158 221,815 38,721 1,472,390 1,778,084
	97,568 748,868 95,776 2,625,437 3,567,649
	45,158 221,815 38,721 1,472,390 1,778,084

During the year ended August 31, 2020, there were additions of $580,760 (2019 - $2,887,352) of assets in process, largely related to build out costs for recreational retail locations not yet in operation.

12. RIGHT OF USE ASSETS AND LEASE OBLIGATIONS

The Company has entered into various lease agreements to operate cannabis retail locations.

The following is a summary of the Company’s right of use assets for the year ended August 31, 2020:

Right of use assets	12,599,918 3,583,506 (3,063,623) (2,848,585) (117,477) (2,409,784) 7,743,955
Balance at September 1, 2019 Net additions Termination Depreciation expense - continuing Depreciation expense - discontinued Impairment Balance at August 31, 2020

The following is a summary of the Company’s lease obligations for the year ended August 31, 2020:

Lease obligations	12,216,478 3,345,388 (3,021,288) (3,976,056) 1,734,100 6,181 10,304,803
Balance at September 1, 2019 Net additions Termination Lease liability payments Accretion expense - continuing Accretion expense - discontinued Balance at August 31, 2020

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

12. RIGHT OF USE ASSETS AND LEASE OBLIGATIONS (continued)

Presented as: Current lease obligation Long-term lease obligation	2,376,458 7,928,345 10,304,803

For the year ended August 31, 2020, variable lease payments amounted to $1,809,039.

The following is a summary of the contractual undiscounted cash outflows for lease obligations as of August 31, 2020:

1, 2020:
Less than one year One to three years Three to five years Five years onwards Total undiscounted lease obligations	4,121,419
	7,889,847
	2,678,820
	915,029
	15,605,115

13. LOAN RECEIVABLE

During the year ended August 31, 2020 the Company advanced $1,634,107 to one of the winners of the Ontario cannabis store lottery to fund the build out and start-up operations of several retail locations in Ontario. Pursuant to the terms of the agreements, the loans have an interest rate of 3% per annum. As at August 31, 2020 the total interest owing amounts to $25,067. The principal balance is due and payable on the fifth anniversary date of the loans. As at August 31, 2020 a total of $1,147,688 was advanced for the Kitchener retail location that the Company acquired on September 17, 2020. As at September 17, 2020, the loan balance for the Kitchener retail location amounted to $788,951.

On January 27, 2020, the Company advanced $50,000 to Sicamous Trading Company. Pursuant to the terms of the agreement, the loan has an interest rate of 6% per annum. As at August 31, 2020 the total interest owing amounts to $1,750. The principal balance is due and payable on January 31, 2021.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

14. INTANGIBLE ASSETS AND GOODWILL

Cost:	Total Goodwill	Service Contracts (i) Strategic Alliance (ii) Cannabis Licenses (iii) Trademark	Total Intangible Assets
At August 31, 2018	1,413,939	13,000,784 2,654,500 - -	15,655,284
Additions Impairment At August 31, 2019 Additions (Note 17) Disposals (Note 8) Impairment – Medical (Note 8) Impairment - Retail (i) At August 31, 2020 Accumulated Amortization At August 31, 2018 Amortization At August 31, 2019 At August 31, 2020 Net carrying amounts: At August 31, 2019 At August 31, 2020	7,632,227 (2,141,772)	- - 22,536,000 30,000 (13,000,784) (279,413) (1,405,827) -	22,566,000 (14,686,024)
	6,904,394	- 2,375,087 21,130,173 30,000	23,535,260
	- (580,442) (833,498) (3,542,311)	- - 800,000 - - - - - - - - - - - (13,096,381) -	800,000 - - (13,096,381)
	1,948,143	- 2,375,087 8,833,792 30,000	11,238,879
	- -	- 698,555 - - - 1,676,532 - -	698,555 1,676,532
	-	- 2,375,087 - -	2,375,087
	-	- 2,375,087 - -	2,375,087
	6,904,394	- - 21,130,173 30,000	21,160,173
	1,948,143	- - 8,833,792 30,000	8,863,792

(i) Impairment loss

During the year ended August 31, 2020, management assessed whether indicators of impairment existed at its retail locations and concluded that indicators of impairment existed at several cannabis retail locations due to certain store closures and the underperformance of several retail locations due to a significant increase in competition, primarily in the Alberta market. The Company performed an impairment test for all retail locations (each retail location being a separate cash generating unit “CGU”) where indicators of impairment existed by comparing the carrying value of the retail locations to its recoverable amount. As a result of the impairment test, management concluded that indicators of impairment existed on 18 Alberta retail locations, 2 Manitoba retail locations, and 1 Saskatchewan retail location.

The total carrying amount of goodwill and intangibles before impairment for these CGUs is as follows: (i) $5,490,462 in goodwill, and (ii) $21,130,173 in intangibles. The carrying amount of goodwill and intangibles for the Alberta retail locations is allocated across multiple retail locations as follows: (i) $277,089 in goodwill, and (ii) 844,720 in intangibles for each retail location.

The recoverable amount of each CGU was determined based on value-in-use calculations being higher than fair value less costs of disposal, covering a detailed five-year forecast based on the past financial results and management’s assessment of the future performance of each CGU. The following are the key assumptions on which management has based its cash flow projections:

• The present value of the expected cash flows for each CGU was determined by applying an 18 percent discount rate reflecting current market assessments of the time value of money and risks specific to each CGU. The same discount rate was applied for the impairment test for the year ended August 31, 2019.

• Retail store profit margins to remain consistent over the five-year forecast based on historical results to date.

• Revenues and operating expenses estimated to increase by 2 percent year over year.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

14. INTANGIBLE ASSETS AND GOODWILL (continued)

As a result of the identified impairments, the Company recorded the following impairment losses during the period ending August 31, 2020: i) $3,542,311 for goodwill and for $13,096,381 intangible impairment charge allocated to the retail cannabis licenses, ii) $3,661,488 impairment charge to property and equipment, iii) $711,542 impairment charge to assets in process and iv) $2,409,784 impairment charge to right of use assets. The total impairment loss amounts to $23,421,506 for the year ended August 31, 2020 which has been recognized through the statement of net loss and comprehensive loss.

15. TERM LOANS

On December 14, 2018, the Company entered into a $9,000,000 loan agreement with Opaskwayak Cree Nation (“OCN”). The loan had a six-month term and carried an interest rate of 8% per annum payable monthly in arrears. In connection with the advance of the loan, the Company issued 900,000 warrants to OCN. Each warrant is redeemable for one Common Share in the capital of the Company at a price of $1.08 per Common Share for a period of three years from the date of the loan agreement. The warrants issued were valued at $186,732 using the Black-Scholes option pricing model and the following assumptions: fair value of common shares of $1.08; expected life of 3 years; $Nil dividends, 74% volatility, and risk-free interest rate of 2.2%.

On May 30, 2019, the Company converted its $9,000,000 term loan with OCN, having a maturity date of June 14th, 2019 into an open line of credit. The line of credit carried an interest rate of 10% per annum with a December 14, 2019 maturity date. On November 18, 2019, the Company entered into an Amended Loan Agreement with OCN to extend the maturity date of the loan until December 31, 2022, at an annual interest rate of 10% and an annual administration fee of $225,000 payable annually in arrears. As a result of the debt restructuring, the Company recognized a $547,553 debt restructuring loss in the statement of net loss and comprehensive loss for the year ended August 31, 2020. The carrying value of the loan balance as at August 31, 2020 amounts to $9,592,156.

On December 18, 2019, the Company entered into a Loan Agreement with OCN in respect of an unsecured loan, pursuant to which OCN will lend up to $11,000,000 to the Company. The Loan has a 5- year term and any funds drawn down carry an interest rate of 10% per annum and incur an annual administration fee of 2.5% on the weighted average balance of the Loan advanced to the applicable date, paid annually to OCN each December 31. As at August 31, 2020 the Company has drawn a total of $4,000,000.

16. CONVERTIBLE DEBENTURE

On November 23, 2018, the Company completed a private placement offering of special warrants that entitle the holders to receive 8% senior secured convertible debentures of the Company upon exercise of the special warrants (“Convertible Debentures”). 21,150 special warrants were issued at a price of $1,000 per special warrant for aggregate gross proceeds to the Company of $21,150,000. In consideration of the services provided by the agents under the offering, the Company paid the agents a cash commission and other costs and expenses totaling $905,170. On January 7, 2019 the Company received a receipt from the Ontario Securities Commission for the final short form prospectus. In accordance with the terms of the special warrant indenture governing the special warrants, all unexercised special warrants were deemed to be exercised, without further action on the part of the holder, on January 10, 2019, being the third business day following the date of the Receipt.

The Convertible Debentures bear interest at a rate of 8.00% per annum, payable semi-annually in arrears on May 31 and November 30 of each year, commencing May 31, 2019. The Convertible Debentures will be convertible at any time at the option of the holders thereof into common shares of the Company at a conversion price of $1.08 per Common Share, subject to customary adjustment. The Convertible Debentures will mature on November 30, 2021.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

16. CONVERTIBLE DEBENTURE (continued)

The Company used the residual value method to allocate the principal amount of the Convertible Debentures between the liability and equity components. The Company valued the debt component of the Convertible Debentures by calculating the present value of the principal and interest payments, discounted at a rate of 18.5%, being management’s best estimate of the rate that a non-convertible debenture with similar terms would earn. The Company has allocated the proceeds from issuance between the estimated fair value of equity and debt components using an effective interest rate for the debt component of 18.5%. Based on this calculation, the liability component is $18,555,918 and the residual equity component is $3,418,081. For the year ended August 31, 2020, the accreted interest on the Convertible Debentures was $1,675,271 (August 31, 2019 - $1,089,478) and interest expense amounted to $1,692,000 (August 31, 2019 - $1,304,504).

On November 11, 2019, the Company provided notice to the registered holders of the Convertible Debentures that, pursuant to the terms of the convertible debenture indenture governing the terms of the Convertible Debentures dated November 23, 2018, between the Company and TSX Trust Company, the Company had elected to satisfy the entirety of the current interest obligation by the delivery of common shares in the capital of the Company. In accordance with the Convertible Debentures, interest in the amount of $846,000 was due and payable to Convertible Debentures holders on November 30, 2019. The Common Shares issued in satisfaction of the Current Interest Obligation were issued at a price per Common Share of $0.204 which equals the volume weighted average price for the ten consecutive trading days ending on November 27, 2019. As such, 4,140,005 common shares were issued to satisfy the interest obligation.

17. ACQUISITIONS AND DISPOSALS

(i) 11522302 Canada Inc.

On June 30, 2020, the Company completed the acquisition of all of the issued and outstanding shares of 11522302 Canada Inc. 11522302 Canada Inc. operates a retail cannabis location in Toronto, Ontario. Under the terms of the share purchase agreement, the total purchase price payable for the 11522302 Canada Inc. shares amounted to $687,576, subject to working capital adjustments amounting to $36,104. The total consideration paid amounted to $723,680, with the entire purchase price paid in cash.

Since the date of acquisition, 11522302 Canada Inc. has earned revenue of $359,055 and a net loss of $246,057 for the year ended August 31, 2020. The Company has accounted for this transaction as a business combination under IFRS 3 as the group of assets acquired met the definition of a business.

The following table summarizes the fair value of the net assets acquired.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

17. ACQUISITIONS AND DISPOSALS (continued)

Cash consideration	723,680
Net identifiable assets acquired
Cash and cash equivalents	337,878
Trade and other receivables	66,998
Inventory	142,574
Prepaid expenses	20,024
Property and equipment	491,621
Right of use assets	1,644,023
Trade and other payables	(104,697)
Lease obligation	(1,506,823)
Deferred tax recovery	(25,883)
Total net identifiable assets acquired	1,065,715
Gain on bargain purchase	(342,035)
Total consideration	723,680

The Company has recognized a gain on bargain purchase amounting to $342,035 in the statement of net loss and comprehensive loss as the fair value of the identifiable net assets exceeds the fair value of the consideration transferred.

On August 31, 2020, the Company disposed of all of the issued and outstanding shares of 11522302 Canada Inc. Under the terms of the agreement, the total consideration for the sale of the shares amounted to $1,235,000, subject to working capital adjustments.

Cash consideration received	1,235,000
Total consideration received	1,235,000
Carrying value of net assets disposed:
Cash and cash equivalents	207,624
Trade and other receivables	81,234
Inventory	109,347
Prepaid expenses	14,658
Property and equipment	472,027
Trade and other payables	(11,830)
Total carrying value of net assets	873,060
Gain on disposal of assets	361,940

The gain on disposal of assets is included in the statement of net loss and comprehensive loss for the year ended August 31, 2020.

(ii) 2208292 Alberta Ltd.

On August 26, 2020, the Company completed the acquisition of all of the issued and outstanding shares of 2208292 Alberta Ltd. (o/a “Bud & Sally”). Bud & Sally operates a retail cannabis location in Waterloo, Ontario. Under the terms of the share purchase agreement, the total purchase price payable for the Bud & Sally shares amounted to $1,150,001, subject to working capital adjustments amounting to $18,479. The total consideration paid amounted to $1,168,480, with the entire purchase price paid in cash.

Since the date of acquisition, Bud & Sally has earned revenue of $135,434 and net income of $34,113 for the year ended August 31, 2020. The Company has accounted for this transaction as a business

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

17. ACQUISITIONS AND DISPOSALS (continued)

combination under IFRS 3 as the group of assets acquired met the definition of a business. The following table summarized the fair value of the net assets acquired.

Cash consideration	1,168,480
Net identifiable assets acquired include:
Bank indebtedness	(35,598)
Trade and other receivables	42,111
Inventory	322,871
Prepaid expenses	6,963
Property and equipment	460,641
Right of use assets	443,134
Cannabis license	800,000
Trade and other payables	(68,067)
Deferred tax liability	(231,529)
Lease obligation	(393,134)
Total net identifiable assets acquired	1,347,392
Gain on bargain purchase	(178,912)
Totalconsideration	1,168,480

The Company has recognized a gain on bargain purchase amounting to $178,912 in the statement of net loss and comprehensive loss as the fair value of the identifiable net assets exceeds the fair value of the consideration transferred.

18. EQUITY INSTRUMENTS

(a) Share Capital

(i) On October 24, 2019, 2,007,860 surplus common shares held in escrow were cancelled and returned to treasury and $501,965 in cash held in escrow was also returned to the Company, in accordance with the Escrow Agreement relating to the acquisition of The Green Company Ltd.

(ii) On January 23, 2020, the Company entered into an agreement with Echelon Wealth Partners Inc. (“Echelon”), pursuant to which Echelon agreed to purchase, on a bought deal basis, 45,454,600 units of the Company at a price of $0.22 per unit. On February 6, 2020, the Company closed the offering for total gross proceeds of $10,000,012. Each unit consists of one common share of the Company and one common share purchase warrant. Each warrant will entitle the holder to acquire one common share at a price of $0.29 for a period of 36 months from the closing date of the offering. The warrants were attributed a fair value of $4,363,642 using the Black-Scholes option pricing model with the following assumptions: fair value of common shares of $0.22; exercise price of options of $0.29; expected life of three years; 77.5% volatility; and a risk-free interest rate of 1.30%. The underwriters received a cash commission fee of 7% of gross proceeds as a result of conducting the bought deal financing. The Company issued warrants to the underwriters equal to 7% of the units sold in the offering, for a total of 3,181,822 warrants. The broker warrants entitle the holder to acquire one common share at an exercise price of $0.29 up to the date that is 36 months from the closing date. The warrants were attributed a fair value of $305,455 using the BlackScholes option pricing model with the following assumptions: fair value of common shares of $0.22; exercise price of options of $0.29; expected life of three years; 77.5% volatility; and a risk-free interest rate of 1.30%.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

18. EQUITY INSTRUMENTS (continued)

(b) Warrants

Outstanding, beginning of the year Expired during the year Issued during the year Exercised during the year	August 31, 2020 August 31, 2019
	Number of Warrants Weighted Average Exercise Price $ Number of Warrants Weighted Average Exercise Price $
	11,520,475 0.92 10,755,937 0.90 (5,620,475) 0.90 (960,000) 0.70 48,636,422 0.29 1,860,000 0.88 - - (135,462) 0.26
Outstanding, end of the year	54,536,422 0.36 11,520,475 0.92

The following table summarizes the warrants that remain outstanding as at August 31, 2020. All warrants outstanding as at August 31, 2020 are exercisable.

			Weighted average
			remaining contractual
Exercise Price $	Warrants #	Expiry Date	life (years)
0.29	48,636,422	February 6, 2023	2.4
0.91	5,000,000	April 11, 2023	2.6
1.08	900,000	December 21, 2021	1.3
0.36	54,536,422		2.4

19. NON-CONTROLLING INTERESTS

The net changes in the non-controlling interests is as follows:

	NAC Bio Inc. National Access Cannabis Medical Inc. NAC Northern Alberta Limited Partnership NAC Arrowhead Limited Partnership NAC Long Plain Limited Partnership NAC OCN Limited Partnership NAC Thompson North Limited Partnership Total
September 1, 2018 Acquisition Impairment loss Recovery of contingent liability Net Income / (Loss) August 31, 2019 Net Income / (Loss) August 31, 2020	381,876 4,785,232 (210,777) - - - - 4,956,331 - - 266,417 - - - - 266,417 - (6,370,384) - - - - - (6,370,384) - 1,999,200 - - - - - 1,999,200 (363,113) (408,800) (55,640) (88,949) (52,122) (26,614) 48,496 (946,742)
	18,763 5,248 - (88,949) (52,122) (26,614) 48,496 (95,178)
	(42,000) 23,057 - (257,952) 110,347 37,331 51,525 (77,692)
	(23,237) 28,305 - (346,901) 58,225 10,717 100,021 (172,870)

20. SHARE-BASED COMPENSATION

(a) Stock option plan

The Company’s stock option plan is applicable to directors, officers, employees and consultants of the Company. The options are granted at the Company's current fair market value of the common shares under terms and conditions determined by the Board of Directors of the Company. Under the terms of the plan, the options generally vest immediately or throughout a set time period and expire at various dates from the date of the grant. The Board of Directors has the right to modify vesting periods at the time of option grant. There were nil options issued for the year ended August 31, 2020 (August 31, 2019 – 2,810,000). The

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

20. SHARE-BASED COMPENSATION (continued)

employee compensation expense related to options vested for the year ended August 31, 2020 is $457,951 (August 31, 2019 - $963,891). The Company may issue up to 10% of the issued and outstanding common shares under its stock option plan.

A summary of the status of the Company's issued and outstanding stock options as of August 31, 2020 and August 31, 2019, and changes during the years ended on those dates, is presented below:

Outstanding, beginning of year Granted Exercised Forfeited Outstanding, end of year	August 31, 2020 August 31, 2019
	Number of options Weighted average exercise price Number of options Weighted average exercise price
	5,611,892 0.66 8,151,892 0.37 - - 2,810,000 0.75 - - (3,225,000) 0.14 (1,000,000) 0.79 (2,125,000) 0.52
	4,611,892 0.63 5,611,892 0.66

The following table summarizes information about stock options as at August 31, 2020:

		Weighted		Weighted
		average	Number	average
	Number	remaining	exercisable at	remaining
	outstanding at	contractual	August 31,	contractual life
Exercise price $	August 31, 2020	life (years)	2020	(years)
0.083	66,892	5.5	66,892	5.5
0.25	1,090,000	2.3	1,090,000	2.3
0.51	250,000	2.3	250,000	2.3
0.55	160,000	2.4	160,000	2.4
0.60	120,000	3.3	90,000	3.3
0.61	195,000	3.3	165,000	3.3
0.67	75,000	2.8	75,000	2.8
0.70	945,000	2.5	945,000	2.5
0.85	560,000	2.5	560,000	2.5
0.86	300,000	2.7	300,000	2.7
0.91	350,000	3.5	350,000	3.5
0.92	500,000	2.6	400,000	2.6
0.63	4,611,892	2.6	4,451,892	2.6

(b) Restricted Share Units (“RSUs”) plan

The Company’s RSU plan is applicable to directors, officers, and employees of the Company. The number of RSUs granted, and any applicable vesting conditions are determined by the board of directors of the Company. The RSUs are equity-settled and each RSU can be settled for one common share for no consideration. There were 4,264,599 RSUs issued during the year ended August 31, 2020 compared to nil for the year ended August 31, 2019. During the year ended August 31, 2020, 296,584 RSUs were forfeited. The employee compensation expense related to RSUs for the year ended August 31, 2020 amounted to $138,796, compared to the year ended August 31, 2019 of $Nil. The fair value of RSUs is based on the grant date share price.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

20. SHARE-BASED COMPENSATION (continued)

The number of RSUs outstanding at August 31, 2020 amounts to 3,968,015. The maximum number of shares that may be issuable under the RSU plan shall not exceed in aggregate, when combined with all of the Company’s other security based compensation arrangements, that amount of shares which is equal to 10% of the issued and outstanding shares of the Company.

21. SEGMENTED INFORMATION

As of August 31, 2020, the Company’s retail cannabis stores constituted the only remaining reportable segment that is included in the results of continuing operations due to the divestiture of the medical cannabis education segment.

Management reviewed its current continuing operations using the criteria stated in IFRS 8 – Operating Segments and determined that the Company has one reportable segment based on the operating results of business activities with discrete financial information that is reviewed by the Company’s chief operating decision maker for the purpose of resource allocation and assessing performance. The results of discontinued operations are presented in Note 8.

22. FINANCE AND OTHER COSTS

Accretion expense Accretion expense on lease liabilities Interest on convertible debenture Interest on term loans Loss on restructuring of term loan Loss on lease termination Commitment fee	August 31, 2020 August 31, 2019
	1,675,271 1,727,964 1,734,100 - 1,692,000 1,304,504 1,221,638 632,259 547,553 - 481,480 - - 1,642,857
Total Finance and other costs	7,352,042 5,307,584

The following finance and other costs are included in net loss from discontinued operations:

Accretion expense on lease liabilities Gain on lease termination	August 31, 2020 August 31, 2019
	6,181 - (2,293) -
Total Finance and other costs	3,888 -

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META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

23. LOSS PER SHARE

The calculation of basic and diluted loss per share for the relevant periods is based on the following information:

Basic loss per share Total net loss attributable to shareholders of Meta Growth Corp. Weighted average number of common shares outstanding Total net loss per common share, basic Diluted loss per share Total net loss attributable to shareholders of Meta Growth Corp. Weighted average number of common shares outstanding Weighted average number of common shares outstanding assuming dilution Total net loss per common share, diluted	August 31, 2020 August 31, 2019
	(37,452,548) (26,758,676) 216,211,223 180,934,590
	(0.17) (0.15)
	(37,452,548) (26,758,676) 216,211,223 180,934,590 216,211,223 180,934,590
	(0.17) (0.15)

The treasury stock method is used to calculate loss per share and under this method stock options and warrants that are anti-dilutive are excluded from the calculation of diluted loss per share. For the years ended August 31, 2020 and August 31, 2019, all outstanding options and warrants were considered antidilutive because the Company recorded a loss over those periods. The outstanding stock options and warrants that could dilute basic net loss per share in future periods but were not included in determining diluted net loss per share for the year ended August 31, 2020 and August 31, 2019 because they are antidilutive are as follows:

Stock options Warrants	2020 2019
	4,611,892 5,611,892 54,536,422 11,520,475
	59,148,314 17,132,367

24. KEY MANAGEMENT PERSONNEL COMPENSATION

Compensation for key management personnel, including the Company's Officers and Board of Directors, was as follows:

Salaries Share-based compensation Total Key Management Compensation	August 31, 2020 August 31, 2019
	1,601,523 1,585,463 488,732 883,665
	2,090,255 2,469,128

Salaries include cash payments for base salaries and bonuses. Share-based compensation includes the compensation expense recognized during the period for key management personnel.

25. RELATED PARTY TRANSACTIONS

Related parties include the Company’s key management personnel, independent directors and shareholders. Transactions with related parties were conducted in the normal course of operations and are measured at the exchange amount, which is the amount of consideration established and approved by the related parties.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

25. RELATED PARTY TRANSACTIONS (continued)

A former director of the Company was engaged to provide consulting services to the Company. During the year ended August 31, 2020, the Company’s expenses included $20,000 (August 31, 2019 - $120,000) related to these services. Effective October 31, 2019, the consulting agreement was terminated.

A director of the Company is Chief of the Opaskwayak Cree Nation (“OCN”). On November 18, 2019, the Company entered into an Amended Loan Agreement with OCN to extend the maturity date of the loan until December 31, 2022, at an annual interest rate of 10% and an annual administration fee of $225,000. The terms of the loan are disclosed in Note 15.

On December 18, 2019, the Company entered into a Loan Agreement with OCN in respect of an unsecured loan, pursuant to which OCN will lend up to $11,000,000 to the Company. The Loan has a 5-year term and any funds drawn down carry an interest rate of 10% per annum and incur an annual administration fee of 2.5% on the weighted average balance of the Loan advanced to the applicable date, paid annually to OCN each December 31. The terms of the loan are disclosed in Note 15.

26. INCOME TAXES

i) Income Taxes

Income tax recovery recognized in net loss consists of the following components:

Current tax expense Deferred tax recovery Income tax recovery	August 31 2020 August 31 2019
	16,674 - (1,483,461) (2,824,630)
	(1,466,787) (2,824,630)

Deferred tax recovery recognized in net loss consists of the following components:

Origination and reversal of temporary differences Difference between tax rates Change in tax benefits not recognized Deferred tax recovery	August 31 2020 August 31 2019
	(8,172,083) (3,606,796) (22,017) (58,869) 6,710,638 841,035
	(1,483,461) (2,824,630)

Income tax recovery varies from the amount that would be computed by applying the basic federal and provincial tax rates to loss from operations before incomes taxes, shown as follows:

Expected tax rate Expected tax benefit resulting from loss Permanent differences Effect of temporary differences not recognized Minority interest Impact of a change in rates Income tax recovery	August 31 2020 August 31 2019
	25.33% 27.00%
	(9,521,869) (6,670,261) 723,184 3,467,347 7,215,945 334,480 17,133 35,352 98,819 8,452
	(1,466,787) (2,824,630)

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

26. INCOME TAXES (continued)

Deferred income taxes reflect the impact of loss carry forwards and of temporary differences between amounts of assets and liabilities for financial reporting purposes and such amounts as measured by tax laws. The following deferred tax assets and liabilities have been recognized for accounting purposes:

Property and equipment Intangible assets Loss carry forwards Other Deferred tax liability	August 31 2020 August 31 2019
	(57,660) - (2,066,672) (4,996,532) 310,654 2,354,100 (281,563) (886,576)
	(2,095,241) (3,529,008)

The effect of temporary differences and loss carry forwards that give rise to significant portions of the deferred tax assets and liabilities, which have been recognized during the year, are as follows:

Deferred tax asset Loss carry forwards Share issuance costs Deferred tax liability Fixed assets Intangible assets Other Net deferred tax asset/(liability) Deferred tax asset Loss carry forwards Share issuance costs Deferred tax liability Fixed assets Intangible assets Other Net deferred tax asset/(liability)		August 31 2019 Recognized on acquisition Recognized in profit and loss Recognized in equity August 31 2020
		2,354,100 15,231 (2,058,677) - 310,654 - - (207,718) 207,718 -
		2,354,100 15,231 (2,266,395) 207,718 310,654 - (60,643) 2,984 - (57,659) (4,996,532) (212,000) 3,141,860 - (2,066,672) (886,576) - 605,013 - (281,563)
		(5,883,108) (272,643) 3,749,857 - (2,405,894)
		(3,529,008) (257,412) 1,483,461 207,718 (2,095,241)
		August 31 2018 Recognized on acquisition Recognized in profit and loss Recognized in equity August 31 2019
		26,779 627,294 1,700,026 - 2,354,100 - - (166,908) 166,908 -
		26,779 627,294 1,533,118 166,908 2,354,100 (26,779) 63,269 (36,490) - - - (6,092,820) 1,096,288 - (4,996,532) - 84,200 231,713 (1,202,488) (886,576)
		(26,779) (5,945,351) 1,291,511 (1,202,488) (5,883,108)
		- (5,318,057) 2,824,629 (1,035,580) (3,529,008)

The gross effects of temporary differences and loss carry forwards that give rise to significant portions of the deferred tax asset, which have not been recognized, are as follows:

Property and equipment Share issuance costs & deferred financing fees Non-capital losses Other Total	August 31 2020 August 31 2019
	8,986,965 3,124,532 1,527,076 1,341,149 40,150,710 21,518,454 4,011,123 -
	54,675,874 25,984,135

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

26. INCOME TAXES (continued)

The Company has the following non-capital losses (recognized and unrecognized) available to reduce future years federal and provincial taxable income, which expire as follows:

2033 2034 2035 2036 2037 2038 2039 2040	4,492 592,545 559,107 1,411,790 4,329,945 7,640,894 13,496,553 13,251,420 41,286,747

27. FINANCIAL INSTRUMENTS

The table below summarizes the carrying values of the Company's financial assets and financial liabilities:

Financial assets: FVTPL Cash and cash equivalents Restricted cash Derivative asset Investment Amortized cost Trade receivables Note receivable Loan receivables	As at August 31, 2020 As at August 31, 2019
	11,151,223 7,528,849 - 501,965 43,016 - 696,205 - 901,646 312,082 1,710,924 211,263 - -
Total financial assets Financial liabilities: Amortized cost Trade and other payables Term loan Due to shareholders Convertible debenture Lease obligation	14,815,096 8,242,077 3,478,524 3,637,227 13,592,156 9,000,000 - 410,000 18,555,918 16,880,647 10,304,803 -
Total financial liabilities	45,931,401 29,927,874

Financial Risk Management Objectives and Policies

The Company manages its exposure to a number of different financial risks arising from its operations as well as its use of financial instruments including market risk, credit risk and liquidity risk through its risk management strategy. The objective of the strategy is to support the delivery of the Company's financial targets while protecting its future financial security and flexibility. Financial risks are primarily managed and monitored through operating and financing activities. The financial risks are evaluated regularly with due consideration to changes in the key economic indicators and up-to-date market information.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

27. FINANCIAL INSTRUMENTS (continued)

A summary of the Company's risk exposures as it relates to financial instruments is reflected below:

Market risk

a) Currency risk

The Company does not operate outside of Canada and therefore there is no inherent Currency risk.

b) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company's financial debt have fixed rates of interest and therefore expose the Company to fair value risk as the fixed rates limit or eliminate the cash flow risk from financial liabilities.

c) Price risk

Price risk is the risk of variability in fair value due to movements in equity or market prices. The Company holds investments and is exposed to price fair value risk.

Liquidity Risk

Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities. The Company manages liquidity risk by continuously monitoring forecasts and actual cash flows and taking the necessary actions to maintain enough liquidity for operations and for growth objectives.

As at August 31, 2020 the Company had $11,151,223 in cash and cash equivalents (2019 - $7,528,849). The Company is obligated to pay financial liabilities with total carrying amounts and contractual cash flows amounting to $7,599,943 in the next 12 months (2019 - $4,047,227).

As at August 31, 2020, the Company’s financial liabilities have contractual maturities as summarized below:

Trade and other payables Term loan Convertible debenture Lease obligation Total Trade and other payables Debt financing Due to shareholders Convertible debenture Total	Due within August 31 2020
	12 months 1-3 years 3 years onwards Total
	3,478,524 - - 3,478,524 - 9,000,000 4,000,000 13,000,000 - 21,150,000 - 21,150,000 4,121,419 7,889,847 3,593,849 15,605,115
	7,599,943 38,039,847 7,593,849 53,233,639
	Due within August 31 2019
	12 months 1-3 years 3 years onwards Total
	3,637,227 - - 3,637,227 - 410,000 - - 9,000,000 - 9,000,000 410,000 - 21,150,000 - 21,150,000
	4,047,227 21,150,000 9,000,000 34,197,227

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

27. FINANCIAL INSTRUMENTS (continued)

Credit Risk

Credit risk arises from cash held with banks and trade receivables. The Company does not have a significant concentration of risk with any customer and its maximum risk exposure is equal to the carrying value of the financial assets. The objective of managing credit risk is to prevent loss on financial assets. The Company minimizes credit risk as cash is held by reputable financial institutions. The Company is not aware of any material collection issues. The Company applies the IFRS 9 simplified model of recognizing lifetime expected credit losses for all trade receivables as these items do not have a significant financing component. Trade receivables are written off when there is no reasonable expectation of recovery. The following table summarizes the Company’s aging of trade receivables and expected credit losses as at August 31, 2020:

	As at August 31, 2020
	Trade Receivables Expected credit losses
0 – 30 days 31 – 60 days 61 – 90 days Over 90 days Total	67,800 1,132 (7,098) (122) 67,576 2,870 22,609 1,922
	150,887 5,802

28. CAPITAL MANAGEMENT

The capital structure of the Company consists of debt financing and equity attributable to common shareholders, comprised of issued capital, treasury shares, equity-settled employee benefits reserve, deficit, and accumulated other comprehensive loss. The Company’s objectives when managing capital are to: (i) preserve capital, (ii) obtain the best available net return, and (iii) maintain liquidity.

The Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust the capital structure, the Company may attempt to issue new shares.

The Company is not subject to externally imposed capital requirements and there has been no change with respect to the capital management strategy during the year ended August 31, 2020.

29. SUBSEQUENT EVENTS

On September 17, 2020, the Company completed an asset purchase agreement to acquire a recreational cannabis store in Kitchener, Ontario. Per the terms of the asset purchase agreement, the purchased assets include all contracts including leases, property and equipment, cannabis and accessory inventory, and goodwill. The total consideration amounted to $938,951, comprised of $150,000 in cash and $788,951 in related party debt.

On October 1, 2020, 60,000 shares held in escrow were cancelled and returned to treasury based on a settlement agreement with a third party.

On October 31, 2020, the Company terminated the conditional share purchase agreement to acquire 19.9% of Sicamous Trading Company Incorporated. As a result, 377,358 shares held in escrow were cancelled and returned to treasury.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

29. SUBSEQUENT EVENTS (continued)

On November 12, 2020, a shareholder of the Company exercised 66,892 options at an exercise price of $0.083.

On November 17, 2020, High Tide Inc. (“High Tide”) and the Company announced that, further to the arrangement agreement entered into between High Tide and META on August 20, 2020, pursuant to which High Tide agreed to acquire all of the issued and outstanding common shares of META by way of a plan of arrangement under the provisions of the Business Corporations Act, the TSX Venture Exchange (“TSXV”) granted final approval for the listing of (i) 436,153,806 of High Tide’s common shares, (ii) 40,076,412 warrants, each exercisable for one common share of High Tide at a price of $0.35 per share until February 6, 2023, and (iii) $21,150,000 in secured convertible debentures of META, which are

convertible into common shares of High Tide at a price of $0.22 per share until November 30, 2022 and bear interest at a rate of 8% per annum. The acquisition closed on November 18, 2020. Subsequent to the closing, High Tide was listed for trading on the TSXV as a Tier 2 Issuer and the securities of META were delisted from the TSXV as of November 19, 2020. On December 11, 2020 the Company received approval from the TSXV to be classified as a non-reporting issuer.

Subsequent to year end, 202,541 RSUs vested and were issued to employees of the Company. In addition, the Company’s officers received a total of 1,429,513 RSUs which vested upon closing of the High Tide acquisition.

As a result of the High Tide acquisition that occurred on November 18, 2020, several of the Company’s officers and board of directors were terminated upon closing of the transaction. In accordance with the termination agreements, the Company’s officers earned $1,573,592 in gross severance pay, and the Board of Directors received a total cash payout in lieu of RSU’s forfeited amounting to $145,354.

30 . CONTINGENCIES

A legal claim was filed by a former employee amounting to approximately $215,000. The Company has calculated a provision based on the full amount and the probability of the claim being fully settled. The provision has been recorded in trade and other payables.

In the normal course of business, the Company is party to other litigation, the ultimate outcome of which cannot be reasonably estimated at this time. However, management’s opinion is that the likelihood of any cash outflow as a result of these matters is remote, therefore, no amounts have been provided for this in these consolidated financial statements aside from the claim identified above.

31. COMPARATIVE FIGURES

Certain comparative figures have been reclassified to conform to the methods of presentation adopted in the current year.

META GROWTH CORP. Notes to the Consolidated Financial Statements For the years ended August 31, 2020 and 2019 (Expressed in Canadian Dollars)

32. REVENUES AND OTHER INCOME

	August 31 2020	August 31 2019
Revenues
Retail revenue	54,807,525	52,706,897
Retail management services	471,744	-
Other revenue	543,665	154,701
	55,822,934	52,861,598

Revenues associated with the Medical Cannabis Education segment have been included in net loss from discontinued operations.

The Company has recognized $1,026,934 in government grants for the year ended August 31, 2020 for the Canada Emergency Wage Subsidy (“CEWS”). The amounts were received in connection with a federal program aimed at assisting companies impacted by COVID-19. The Company has recognized the CEWS in Other Income in accordance with IAS 20 – Accounting for Government Grants and Disclosure of Government Assistance.

33. GENERAL AND ADMINISTRATIVE EXPENSES

	August 31 2020	August 31 2019
General and administrative expenses
Bad debt expense	-	17,584
Business taxes and licenses	51,853	119,905
Computer and technology expenses	984,480	793,193
Insurance	411,817	277,905
Interest and service charges	568,547	503,271
Office and store supplies	420,297	688,623
Professional fees	2,672,540	3,192,304
Consulting fees	542,735	2,139,718
Rental	1,790,397	6,629,927
Repairs and maintenance	77,108	76,519
Salaries and benefits	12,358,446	11,806,340
Security	354,300	279,290
Travel and entertainment	191,307	699,302
Utilities	468,274	600,949
	20,892,101	27,824,830

The General and Administrative expenses associated with the Medical Cannabis Education segment has been included in net loss from discontinued operations.