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“We have to do it in a certain order and it is subject to approval from the AGCO. So we are going to do our Sudbury one first,” said Nick Kuzyk, chief strategy officer at High Tide. The two other locations — in Hamilton and Toronto — are currently owned by sole proprietors, who would have to first incorporate into a numbered company in order to simplify the transaction.

Kuzyk declined to speculate on the value of the three stores which have been in operation since the summer of 2019, but company filings state that High Tide’s deal with the Sudbury-based lottery winner included an agreement to fund the “initial phase of development by the lottery winner to a maximum of $1 million, for a period of 10 years.”

“Our deals with the winners were pre-negotiated and approved by the AGCO,” said Kuzyk.

Legally speaking, a cannabis retail licence in Ontario cannot be transferred. An entity looking to take control of an existing cannabis business, will have to pay the appropriate fees and apply for a new licence to run a store already in operation, while the existing licence holder will have to apply to the AGCO to have their licence cancelled.

A bulletin distributed by the AGCO to the first 25 lottery winners also states that the original licence holder “must not process any transactions or movements of cannabis inventories or be open to the public” during the period in which the change of control occurs.

“It’s a fairly complicated process, as the counting of the store’s inventory has to be done in a very specific way, and the OCS is involved with that,” said Harrison Jordan, a cannabis lawyer and consultant who is working with a lottery-winning client in the process of transferring from a sole proprietorship to a corporation.