Enter Wall Street with StreetInsider Premium. Claim your one week free trial here.





Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Report date (date of first reported event): October 12, 2022

TerrAscend Corp.

(Exact name of the holder as specified in his charter)



Not applicable

(State or other jurisdiction
of incorporation)

(commission file number)

(IRS Employer
ID number.)

3610 Mavis Road

Mississauga, Ontario, Canada

L5C 1W2

(Address of main executive offices)

(Postal code)

Holder’s telephone number, including area code: 855 837-7295

(Former name or address, if changed since last report)

Check the appropriate box below if the filing of Form 8-K is intended to concurrently satisfy the filer’s filing obligation under any of the following provisions:

Written communications pursuant to Rule 425 of the Securities Act (17 CFR 230.425)

Solicit material in accordance with Rule 14a-12 of the Exchange Act (17 CFR 240.14a-12)

Pre-opening communications pursuant to Rule 14d-2(b) of the Exchange Act (17 CFR 240.14d-2(b))

Pre-opening communications pursuant to Rule 13e-4(c) of the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class


Name of each exchange listed on

N / A


N / A

Indicate with a check mark whether the registrant is an emerging growth company within the meaning of Rule 405 of the Securities Act of 1933 (§ 230.405 of this Chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b- 2 of this chapter).

Growing emerging company

If the company is an emerging growth company, indicate with a check mark whether the registrant has elected not to use the extended transition period to comply with new or revised financial accounting standards under the section 13(a) of the Exchange Act.

Section 1.01 Entering into a Material Definitive Agreement.

On October 11, 2022, subsidiaries of TerrAscend Corp., an Ontario corporation (“TerrAscend”), TerrAscend NJ LLC, a New Jersey limited liability company (“TerrAscend NJ”), HMS Processing LLC, a Maryland, HMS Hagerstown, LLC, a Delaware limited liability company, and HMS Health, LLC, a Maryland limited liability company (collectively, the “Borrower”), have entered into a loan agreement (the ” Loan”) with Pelorus Fund REIT, LLC (the “Lender”). Capitalized terms used in this Current Report on Form 8-K but not otherwise defined herein shall have the meanings ascribed to them in the Loan Agreement.

The Loan Agreement provides for a one-time senior secured term loan (the “Loan”) in the aggregate principal amount of $45,478,000. The loan proceeds may be used to pay for certain construction works, for the general purposes of TerrAscend and its subsidiaries and for the payment of fees and expenses required under the loan agreement. The loan is guaranteed by TerrAscend, TerrAscend USA Inc., a Delaware corporation, Well and Good, Inc., a Delaware corporation (“Well and Good”), and WBD Holding MD, Inc., a Maryland corporation (“ WDB Holding”).

In accordance with the loan agreement, the maturity date of the loan is October 11, 2027. Interest accrues on the loan at the rate of one-month SOFR (subject to a floor of 2.5%) plus 9. 5% and are payable monthly. Amortization payments are payable monthly beginning on the thirty-sixth monthly interest payment.

Security securing payment and performance of obligations under the Loan consists of a first ranking security interest in each Borrower’s assets, including real estate located in Boonton, New Jersey, Phillipsburg, New Jersey and Hagerstown, Maryland, including improvements and personal property therein. Well and Good and WDB Holding also pledge their respective interests in the Borrower.

The Loan Agreement includes representations and covenants customary for financing transactions of this nature, including, among others, restrictions on indebtedness, grant of encumbrances, fundamental changes and disclosure covenants. The Loan Agreement also contains a covenant to meet a debt service coverage ratio of 1.75:1.00 and failure to meet this triggers an obligation to sweep certain amounts into an escrow account, not a case of default.

An Event of Default under the Loan Agreement includes, but is not limited to, default in payment, breach of certain covenants, insolvency, failure to pay property taxes and maintain insurance, material adverse effect , change of control and cross default and judgments, in each case subject to customary exceptions and thresholds.

In connection with its entering into the Loan Agreement, on October 11, 2022, TerrAscend entered into a promissory note (the “Promissory Note”) with TerrAscend NJ and BWH NJ LLC, a New Jersey Limited Liability Company and Blue Marble Ventures LLC, a New Jersey Limited Liability Company (BWH NJ LLC and Blue Marble Ventures LLC, collectively, the “Minority Members”), pursuant to which TerrAscend NJ has agreed to pay Minority Members the principal sum of $25,000,000 $ in the event that the lender under the loan agreement accelerates the loan or takes any affirmative action to exercise its rights under the mortgage granted by TerrAscend NJ in favor of the lender with respect to real estate located in Boonton , New Jersey and Phillipsburg, New Jersey (the “Triggering Event”). Should the Triggering Event occur and TerrAscend NJ fails to pay all amounts due and payable under the Promissory Note within 90 days, TerrAscend agrees to issue Minority Members Common Shares with a value equal to the amount (if any) unpaid by TerrAscend NJ to minority members pursuant to the promissory note (the “TerrAscend Share Issue”), calculated in accordance with an average of the five trading day closing prices immediately following the event trigger. Assuming the formula was applied using the five trading days preceding the signing of the loan agreement, the maximum number of shares that could be issued under the TerrAscend share issue would be 16,425,540 shares.

The foregoing descriptions of the Loan Agreement and Promissory Note are qualified in their entirety by reference to the full text of the Loan Agreement and Promissory Note, copies of which will be filed as exhibits to the Annual Report of company on Form 10-K for the year ended December 31, 2022.

Item 2.03 Creation of a Direct Financial Obligation or Obligation Under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth in Section 1.01 under the subheading “Loan Agreement” above is incorporated by reference into this Section 2.03.

Item 3.02 Unrecorded Sales of Equity Securities.

The information set out in 1.01 regarding the above promissory note is incorporated by reference into this 3.02.

All securities issued to minority members in connection with the issue of shares of TerrAscend will be issued on the basis of the exemption from registration requirements provided for in section 4 (a) (2) of the Securities Act Securities Act 1933, as amended (the “Securities Act”) and/or Rule 506 of Regulation D promulgated under the Securities Act. These securities may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.


Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be executed on its behalf by the duly authorized undersigned.

TerrAscend Corp.


October 12, 2022


/s/ Keith Stauffer

Keith Stauffer
Financial director





IDEA: R1.htm

IDEA: trssf-20221012_htm.xml

IDEA: Financial_Report.xlsx

IDEA: FilingSummary.xml

IDEA: MetaLinks.json