v3.26.1
RELATED PARTY TRANSACTIONS
 6 Months Ended
Jun. 30, 2026
Related Party Transactions [Abstract]  
RELATED PARTY TRANSACTIONS

 

19. RELATED PARTY TRANSACTIONS

 

During the three and six months ended June 30, 2026 and 2025, the Company incurred the following related party transactions.

 

Transactions with related parties

 

Related parties of the Company include affiliates, entities for which investments are accounted for by the equity method, officers, and directors of the Company and members of their immediate families, and management involved in the financial statement preparation and members of their immediate families.

 

Transactions with related parties are presented in the following table:

 

                               
    Three months ended
June 30,		     Six months ended
June 30,		  
    2026     2025     2026     2025  
    $     $     $     $  
Salaries and consulting fees     364,174       312,000       722,867       595,962  
Lease payments made to CEO     52,168       68,648       104,335       137,296  
Fees paid to entity controlled by spouse of majority owner     642,442       119,229       1,200,227       196,190  
Share-based compensation expense     82,138       115,881       172,866       230,488  
Total     1,140,922       615,758       2,200,295       1,159,937  

 

As of June 30, 2026, the Company had amounts due to related parties of $32,821 (December 31, 2025: $159,413), which are included in accounts payable and accrued liabilities. The Company also has operating and finance lease liabilities due to related parties of $1,993,759 as of June 30, 2026, compared to $1,237,695 as of December 31, 2025.

 

Debt balances and movements with related parties

 

The following table sets out portions of debt pertaining to related parties which are included in consideration payable on business acquisitions and long-term debt:

 

                                       
    CEO(1)     Director(1)     GM(1)     ABCO Holdings, Inc.(2)     Total  
    $     $     $     $     $  
Balance, December 31, 2024     223,142       101,428       1,702,993       460,938       2,488,501  
Interest     10,906       4,957       416,414       68,437       500,714  
Payments     (73,259 )     (33,299 )     (431,975 )     -       (538,533 )
Balance, December 31, 2025     160,789       73,086       1,687,432       529,375       2,450,682  
Interest     4,112       1,869       324,578       33,938       364,497  
Payments     (36,629 )     (16,650 )     (304,910 )     -       (358,189 )
Balance, June 30, 2026     128,272       58,305       1,707,100       563,313       2,456,990  

 

 
(1) Amounts contained within business acquisition consideration payable.
(2) ABCO Holdings, Inc. (“ABCO Holdings”) is a related party because of its majority ownership interest in ABCO. Amounts contained within long-term debt.

 

 

As part of the agreements transacted during the year ended October 31, 2020, to acquire interest in GR Michigan and Canopy, the Company incurred consideration payable on business acquisitions of $360,000 which has a maturity date of April 1, 2028. During the three and six months ended June 30, 2026, interest payments of $191,000 and $304,910, respectively, were made against this balance (three and six months ended June 30, 2025 – $184,450 and $200,650, respectively).

 

Pursuant to the Canopy purchase agreement executed on April 24, 2024, the Company, through GR Unlimited, acquired the remaining 13% of the membership units in Canopy. As part of this transaction, the Company purchased a 5.5% membership interest in Canopy from the CEO, comprised of an upfront cash payment of $66,000 and deferred cash payments of $264,000. Additionally, the Company purchased a 2.5% membership interest in Canopy from a Director, comprised of an upfront cash payment of $30,000 and deferred cash payments of $120,000. The deferred cash payments are to be paid in 48 equal installments at a 5.21% interest rate with a maturity date of April 24, 2028.

 

During April 2024, the Company, through Canopy, acquired an additional 20% of the membership units in Golden Harvest from the GM for aggregate present value consideration of $2,342,207, comprised of deferred cash payments of $2,000,000 plus true-up amounts. Pursuant to the purchase agreement executed on April 24, 2024, the deferred cash payments are to be paid in thirteen quarterly installments beginning on January 1, 2025 with a maturity date of July 27, 2027.

 

On May 29, 2025, Canopy Management LLC was dissolved, and all existing agreements and obligations were assigned and transferred to Grown Rogue Unlimited, LLC.