MariMed Finds $35 Million in New Funds

The company said it has already borrowed $30 million at close.

MariMed, Inc. (CSE: MRMD) (OTCQX: MRMD) has closed on a $35 million secured credit facility, with Chicago Atlantic as the lead lender.

“I am delighted to announce the closing of this transformative credit facility,” MariMed president and interim CEO Jon Levine said in a statement. “MariMed is known for its operational and financial discipline, resulting in one of the strongest balance sheets in the cannabis industry, enabling us to secure this funding.

“While we are capable of funding our current growth plans with cash flow from operations, the time is right to raise capital and accelerate these plans, which we believe will result in meaningful returns to our shareholders.”

The credit line has a three-year maturity, which the company can extend to five years under certain conditions. MariMed said it has already borrowed $30 million at close and can draw down up to an additional $5 million over the next six months.

The company said that the funds will be used to:

  • Finish the build-out of a new cultivation and processing facility in Illinois and a new processing kitchen in Missouri.
  • Expand existing cultivation and processing facilities in Massachusetts and Maryland.
  • Repay in full the Kind Therapeutics seller notes from the Maryland acquisition in April 2022.
  • Fund other capital expenditures.

The remaining balance will be steered toward acquisition deals. The company has the ability to repay the principal loan balance without penalty after the first 20 months.

The loan bears interest at a floating rate based on bank prime rate plus 5.75% and includes 30% warrant coverage priced at a 20% premium. The company’s Debt/EBITDA ratio — based on the midpoint of the company’s 2022 annual EBITDA guidance — is now 1.5X.

“This credit facility allows us to significantly accelerate the completion of our expansion projects, which we believe will drive meaningful Revenue and EBITDA growth in 2023 and beyond,” said Susan Villare, MariMed’s Chief Financial Officer.

The blended interest rate is calculated as the weighted average rate of all interest-bearing loans, mortgages, and the first draw of the $35 million credit facility, and excludes the Kind Therapeutics seller notes, which will be settled with funds from the initial $30 million draw of the $35 million credit facility.

“Our blended interest rate of 10.5% and Debt/EBITDA ratio of 1.5X remain among the lowest in the cannabis industry and speaks to the strength of our balance sheet and our ability to generate significant positive cash flow from operations,” Villare added.

Chicago Atlantic Advisors led the funding effort with Silver Spike Investment Corp. Chicago Atlantic is also the administrative agent for the loan. Echelon Capital Markets acted as the financial advisor to MariMed.

“We are excited to support the growth of MariMed,” said John Mazarakis, chairman and co-founder of Chicago Atlantic. “The team has consistently demonstrated its ability to profitably expand across an attractive six-state footprint for the benefit of its patients and adult-use customers. We look forward to significantly growing our investment with them in the future.”

Adam Jackson

Adam Jackson covers the cannabis industry for The Green Market Report. He previously covered the Missouri statehouse for The Columbia Missourian and has written for The Missouri Independent. He most recently covered retail, restaurants, and other consumer companies for Bloomberg Business News. You can find him on Twitter @adam_sjackson and email him at adam.jackson@crain.com.


Leave a Reply

Your email address will not be published. Required fields are marked *

Choose Your News

Subscribe to the Green Market Report newsletter that gives you original content delivered straight to your inbox.

 Subscribe

By continuing I agree to your Privacy Policy and consent to receive relevant newsletters and other email communications on events, editorial features, and special partner offers from Green Market Report. I can unsubscribe or change my email preferences at any time.


About Us

The Green Market Report focuses on the financial news of the rapidly growing cannabis industry. Our target approach filters out the daily noise and does a deep dive into the financial, business and economic side of the cannabis industry. Our team is cultivating the industry’s critical news into one source and providing open source insights and data analysis


READ MORE



Recent Tweets

@GreenMarketRpt – 2 mins

New York’s Cannabis Market Faces Uphill Climb as Adult-Use Sales Begin

@GreenMarketRpt – 2 mins

Your Take: NY’s Cannabis Market Isn’t Moving Too Slowly — It’s on a Mission

@GreenMarketRpt – 6 mins

Opinión: La industria legal del cannabis en Nueva York debe ser accesible para la comunidad latina

Back to Top

Choose Your News

Subscribe to the Green Market Report newsletter that gives you original content delivered straight to your inbox.

 Subscribe

By continuing I agree to your Privacy Policy and consent to receive relevant newsletters and other email communications on events, editorial features, and special partner offers from Green Market Report. I can unsubscribe or change my email preferences at any time.