TerrAscend Corp (OTCMKTS:TRSSF) has announced an extension on the date of maturity of its $75 million credit facility that was due on December 18, 2019. The company has extended the facility managed by JW Asset Management LLC for three months.
TerrAscend to convert the outstanding amount of credit facility to a term loan
Equally, the company has indicated that it has executed a term sheet for funds that JW Asset management manages to convert any due amounts under the facility to a two-year term loan. The expected date of maturity of the term loan is March 2022. Jason Wild, who is the Chief Investment Officer and President, manages JW Asset Management. He is also the Chairman of the TerrAscend Board.
In line with the conversion of the facility to a term loan, the maturity period has been pushed to March 15, 2022, or until when the parties finalize the process of starting the conversion. The credit facility will have an interest rate of 12.5%, while the term loan, once completed, will provide for the interest of 12.5% paid twice a year. Equally, the loan origination fee will be 1.5% on the borrowed amounts as wells as other protective agreements.
The company will announce the definitive terms of the term loan once they finalize signing. Funds advised by JW Asset Management and other parties will take part in the term loan.
TerrAscend seeking expansion of operations
Jason Ackerman, the Executive Chairman of TerrAscend, indicated that the extension of the credit facility, as well as the commitment of funds for two years, will allow the company a non-dilutive financing source. This will be useful for the company at a time that anticipates regulatory, capital markets, and banking improvement. Ackerman appreciated the support from JW Asset Management and affirmed that the company is focused on enhancing its growth in New Jersey, Pennsylvania, and California.
Jason Wild indicated that when they advanced the original credit facility in 2018 to the company, it had just commenced its growth strategy with Q3 revenue of $1.8m. In the last quarter, TerrAscend’s revenue has exceeded $100m.