MedMen Enterprises Inc. announced that it has signed a binding term sheet in respect of certain amendments to the definitive agreements for the up to $250,000,000 senior secured convertible credit facility led by Gotham Green Partners, an investor in the global cannabis industry. Concurrent to the amendments, Gotham Green Partners, with participation from Wicklow Capital, has agreed to an additional $30,000,000 equity commitment, bringing the total financing commitment to $280,000,000. To date, Gotham Green Partners has funded $100,000,000 of the total commitment.

Both Gotham Green and Wicklow have shown continued confidence in our strategy and recognize the potential ahead.

In addition to funding general working capital, the increased financing commitment will primarily be used to:

• operationalize the balance of the Company’s retail licenses; the Company is licensed for up to 86 retail stores across the U.S., of which 37 are operational today (including the footprint to be acquired through pending acquisitions, subject to customary regulatory approvals);
• focus on strategic markets, such as Illinois, where the Company anticipates 10 stores after the state transitions from a medical to adult use market in 2020 and pending regulatory approvals associated with the PharmaCann acquisition;
• continue expanding the retail presence in Florida, where the Company expects to open 11 additional stores in 2019;
• remain opportunistic with respect to selective growth initiatives such as expanding the Company’s retail footprint and investing in its delivery and loyalty platforms and
• strengthen the Company’s balance sheet.

It is expected that receipt of the initial portion of Tranche 2, in the aggregate principal amount of $25,000,000, will be completed in the coming days. Notes in connection with this portion of Tranche 2 will have a conversion price per share determined in accordance with the amended method noted above.

As a Facility amendment fee, 15% of the outstanding principal amount of the Facility will be added to the balance of the Facility on the effective date of the Facility amendments (such outstanding principal amount is anticipated to be US$125,000,000, given the anticipated completion of the initial portion of Tranche 2 noted above). This amendment fee will be cancelled in the event that either (i) the Facility balance excluding the amendment fee is paid in full (inclusive of any other required fees or premiums), or (ii) a lender under the Facility elects to convert any portion of the Facility and the trading price of the Subordinate Voting Shares at the time of conversion is above US$2.95.

In addition, Gotham Green Partners and Wicklow Capital have committed to a US$30,000,000 non-brokered financing of Subordinate Voting Shares (the “Equity Placement”) at a price equal to US$2.37 per share. The Equity Placement is conditional upon the satisfaction of customary conditions, including but not limited to the receipt of all necessary approvals.