Marijuana MSO TerrAscend seeks to raise $15 million in private placements

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TerrAscend Corp., a North American marijuana multistate operator, plans to raise $15 million in two private placements.

The proceeds will be used to qualify the company to uplist to the Toronto Stock Exchange, the acquisition of medical cannabis dispensaries in Maryland and for “general corporate purposes,” according to a news release.

One private placement will be an equity offering of 5 million units priced at $1.50 per unit, for a total value of approximately $7.5 million.

According to the release:

  • Each unit consists of one common share of the company and half of one common share purchase warrant.
  • The price is equal to a 7.4% discount to the closing price of the common shares on the Canadian Securities Exchange on June 14.
  • Each warrant will allow the holder to acquire one common share at a price of $1.95 per common share for 24 months after the close of the offering.

The other private placement will be a non-brokered offering of senior unsecured convertible debentures priced at $1,000 per debenture, for a total value of roughly $7.5 million.

According to the release:

  • The outstanding principal and accrued, unpaid interest on debentures will be due 36 months after the closing of the offering unless it was repaid or converted earlier.
  • Each debenture has an interest rate of 9.9% per year from its issue date, calculated and compounded semiannually and payable on the maturity date.
  • Holders can choose to receive up to 4.95% per year of interest payable in cash on a semiannual basis.
  • Debentures can be converted into common shares before the maturity date for $2.01, which is a 25% premium to the three-day volume weighted average trading price of the common shares on the Canadian Securities Exchange on June 14.
  • Those who convert their debentures will receive accrued and unpaid interest for the period from the date of the last interest payment date to the conversion date.

TerrAscend, which has operations in Canada, California, Maryland, Michigan, New Jersey and Pennsylvania, recently sold its head office in Mississauga, Ontario.