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TerrAscend proposes US $15 million private placements

(Globe Newswire) Toronto — TerrAscend Corp., a leading North American cannabis operator, today announced its intention to complete two concurrent private placements for total gross proceeds of approximately US $15 million.

The company has received indicative orders of approximately US $15 million. The private placements consist of an offering of units of the company of approximately US $7.5 million and a non-brokered offering of senior unsecured convertible debentures of approximately US $7.5 million. The net proceeds from the private placements will be used to qualify for the company’s proposed TSX listing, to fund Maryland dispensary acquisitions, and for working capital and general corporate purposes. The first closing is expected to occur on June 22, 2023.

Equity Offering

An aggregate of 5 million units are being issued in the proposed equity offering at a price of US $1.50 (CAD $2.00) per unit for aggregate gross proceeds of approximately US $7.5 million (CAD $10 million). Each unit is comprised of one common share of the company and one-half of one common share purchase warrant (each whole common share purchase warrant). The issue price is equal to a 7.4 per cent discount to the closing price of the common shares on the Canadian Securities Exchange (CSE) on June 14, 2023. Each warrant will entitle the holder to acquire one common share from the company at a price of US $1.95 per common share (CAD $2.60) for a period of 24 months following the closing of the equity offering.

Debenture Offering

The company is offering approximately US $7.5 million of debentures in the principal amount of US$1,000 per debenture. Unless earlier repaid or converted, the outstanding principal and accrued and unpaid interest on the debentures will be due and payable 36 months following the closing of the debenture offering. Each debenture will bear interest at a rate of 9.9 per cent per annum from the date of issuance, calculated and compounded semi-annually, and payable on the maturity date. Each holder may, at the option of the holder upon signing of the subscription agreement, elect to receive up to 4.95 per cent per annum of such interest payable in cash on a semi-annual basis. Each debenture will be convertible into common shares, at the option of the holder, at any time or times prior to the close of business on the last business day immediately preceding the maturity date, at a conversion price of US $2.01 (CAD $2.68), representing a 25 per cent premium to the three-day volume weighted average trading price of the common shares on the CSE on June 14, 2023. Holders converting their debentures will receive accrued and unpaid interest for the period from and including the date of the last interest payment date, to and including, the date of conversion.

The securities offered pursuant to the private placements have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the 1933 Act), or under any state securities laws, and may not be offered or sold, directly or indirectly, or delivered within the United States absent registration or an applicable exemption from the registration requirements. This news release does not constitute an offer to sell or a solicitation to buy such securities, and shall not constitute an offer, solicitation or sale in any state or jurisdiction in which an offer, solicitation or sale would be unlawful. This news release is being issued pursuant to and in accordance with Rule 135c under the Securities Act of 1933.