Ascend Wellness Holdings Signs Definitive Agreements to Issue $235 Million of Senior Secured Notes

NEW YORK, July 15, 2024 – PRESS RELEASE – Ascend Wellness Holdings Inc., a multistate, vertically integrated cannabis operator, announced it has received commitments for a private placement of $235 million of its 12.75% senior secured notes due 2029. The notes are expected to be issued at a price of 94.75% of face value (the "offering").

The company intends to use the net proceeds of the notes, together with cash on hand, to prepay $215 million of principal amounts outstanding under its existing term loan. The partial refinancing of the term loan through the issuance of new senior secured notes is a strategic move expected to enhance the company's financial flexibility and strengthen its balance sheet. The offering is expected to close on or about July 16, 2024, subject to customary closing conditions.

"We are thrilled to refinance $215 million of our existing term loan 13 months before its maturity,” Ascend CEO John Hartmann said. “This refinancing marks a significant milestone for Ascend. The five-year notes financing reflects the confidence our lenders have in our business and growth prospects, while enhancing our financial stability and flexibility.

“The support from a majority of our existing term loan lenders, including all of our four largest lenders, highlights their trust in our strategic vision. The diversification of the new institutional noteholders reflects the significant progress Ascend has made in broadening its investor base and in expanding the prospective audience of future stakeholders. We remain committed to driving value for our shareholders and expanding our footprint."

In connection with the offering, on June 28, 2024, the company entered into an amendment agreement with the required lenders under its term loan, pursuant to which certain terms of the term loan were amended to, among other things, permit the issuance of the notes. The $60 million of principal remaining outstanding under the term loan may be carried through to the existing maturity at 9.5% interest.

The notes will be senior secured obligations of the company and will bear interest at a rate of 12.75% per annum, payable semiannually in arrears until their maturity date, unless earlier redeemed or repurchased in accordance with their terms. The notes will mature on July 16, 2029.

At any time and from time to time after the closing of the offering, the company may redeem all or a part of the notes at certain specified redemption prices, including for the first two years at par. The notes will be irrevocably and unconditionally guaranteed, jointly and severally, on a senior secured basis, by certain of the company's subsidiaries (the "guarantees"). The notes and the guarantees will be secured, on a first lien basis, by substantially all assets of the company and certain of its subsidiaries, subject to certain carveouts. The notes and the guarantees will be issued under and governed by an indenture to be entered into on closing of the offering.

This offering and related partial refinancing comes on the heels of the company's fifth consecutive quarter of generating cash from operations, which the company announced in their Q1 2024 results. For more information about Ascend, visit www.awholdings.com.

The notes are being offered on a private placement basis in certain provinces and territories of Canada pursuant to applicable exemptions from the prospectus requirements of Canadian securities laws. The notes may also be sold in the United States to or for the account or benefit of "U.S. persons" (as defined in the United States Securities Act of 1933, as amended (the "U.S. Securities Act")), on a private placement basis to "qualified institutional buyers" and "accredited investors" pursuant to an exemption from the registration requirements of the U.S. Securities Act, and in such jurisdictions outside of Canada and the United States as may be agreed upon by the agent and the company, in each case in accordance with applicable laws. The notes to be issued will be subject to a customary four-month hold period under Canadian securities laws.

The notes have not been and will not be registered under the U.S. Securities Act or any state securities laws. Accordingly, the notes may not be offered or sold within the United States or to or for the account or benefit of "U.S. persons" unless registered under the U.S. Securities Act and applicable state securities laws or pursuant to exemptions from the registration requirements of the U.S. Securities Act and applicable state securities laws.

Seaport Global Securities LLC (the "agent") acted as lead financial adviser and sole placement agent for the notes.