WDB Holding PA, Inc., a subsidiary of TerrAscend Corp. TRSSF TER has completed an amendment to its existing $115 million senior secured term loan in Pennsylvania.
"TerrAscend has taken significant measures recently to reduce its outstanding debt and interest expense, further strengthening our path to positive sustainable cash flow from operations," stated Jason Wild, executive chairman of TerrAscend. "The company has access to multiple additional sources of funds, many of which are non-dilutive and non-interest bearing in nature, and we intend to explore all options for continued debt reduction and balance sheet optimization," continued Wild.
The amendment will reduce company debt by $35 million and annual interest expense by $5 million. Combined with recently announced debt retirement of $125 million, company debt will be reduced by a cumulative $160 million and will result in total annual interest savings of $15 million. TerrAscend will make the $35 million payment on March 15, 2023 at the original prepayment price of 103.22% to par. The loan matures in December 2024 and originally could not be prepaid without penalty until June 2023.
Under the terms of the amendment, TerrAscend will adjust collateral to more appropriately balance its debt with its assets. Included in this rebalancing will be the inclusion of the company's Maplewood and Lodi, New Jersey dispensary assets as added collateral for the Pennsylvania loan, upon satisfaction of certain conditions. Additionally, the amendment now affords the company flexibility to enter into a sale leaseback transaction or mortgage, at its discretion, on its cultivation facility in Pennsylvania, which has an estimated value of $50 million.
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