Terrace Global Inc. has entered into an equity line and profit-sharing agreement with The Flowr Corporation for the purpose of jointly developing an outdoor medical cannabis project in Portugal (the “Project”). Under the terms of the Agreement, Terrace Global will fund certain operations and certain capital expenditures relating to the Project in exchange for the issuance of: common shares of Flowr at the volume weighted average trading price of the shares on the day prior to such subscription less the maximum applicable discount available under the TSX Venture Exchange (“TSXV”) subject to a minimum price of $0.52 per share; and (2) warrants at an exercise price equal to the greater of $0.76 and the minimum exercise price permitted under the TSXV rules. In addition, the parties have agreed to divide the net proceeds from the Project on a 75% basis for Flowr and 25% basis for the Company, with an adjustment to 20% for the Company in certain circumstances.

As part of the Agreement, a Technical Committee comprised of two representatives from the Company and two representatives from Flowr will oversee the Project. The Company also has a renewal option to cultivate at the Aljustrel site during the 2021 season at its sole discretion in exchange for a 50% split of net proceeds from the sale of any medical cannabis derived from that season's operations.