v3.26.1
RIGHT OF USE ASSET AND LEASE LIABILITY
12 Months Ended
Dec. 31, 2025
Right Of Use Asset And Lease Liability  
RIGHT OF USE ASSET AND LEASE LIABILITY

 

11. RIGHT OF USE ASSET AND LEASE LIABILITY

 

The Company’s leases consist of land and buildings and equipment used in the cultivation, processing, and warehousing of its products. The leases were classified as either operating leases or finance leases in accordance with ASC 842, Leases.

 

The lease term includes available extension options where the Company anticipates execution of such option.

 

A summary of the Company’s weighted average discount rate and weighted average remaining lease term as of December 31, 2025 is as follows:

 

               
    December 31,
2025
   

December 31,

2024

 
Operating lease                
Weighted average discount rate     12.01 %     9.63 %
Weighted average remaining lease term (years)     10.46       7.01  
Finance lease                
Weighted average discount rate     16.00 %     - %
Weighted average remaining lease term (years)     1.57       -  

 

On December 5, 2025, GR Unlimited entered into a sublease for the Minnesota property. The sublease will remain in effect until the facility receives operational approval. Rental income earned under the sublease is due one-year from the date that GR Unlimited receives operational approval.

 

A summary of the maturity of contractual undiscounted liabilities associated with the Company’s operating leases and finance leases as of December 31, 2025 is as follows:

 

               
Year ended December 31,   Operating leases     Finance leases  
    $     $  
2026     2,468,059       180,000  
2027     2,458,020       73,874  
2028     2,540,283       -  
2029     2,625,535       -  
2030     2,227,864       -  
Thereafter     15,265,790       -  
Total lease payments     27,585,551       253,874  
Less: Unamortized interest     (13,730,325 )     (33,387 )
Total lease liability     13,855,226       220,487  

 

For the year ended December 31, 2025, the Company incurred operating lease costs in continuing operations of $1,953,327 (year ended December 31, 2024 - $1,819,206). Of this amount, $1,953,327 (year ended December 31, 2024 - $1,819,206) was allocated to inventory.