MedMen Enterprises Inc. (CSE: MMEN) (OTCQX: MMNFF) waiting until the market closed on Wednesday before telling shareholders it picked up another $20 million from lenders and institutional investors. The deal for MedMen includes 10 million in gross proceeds under a new unsecured convertible facility, plus $5.7 million under its senior secured term loan led by Stable Road Capital and $5 million under its senior secured convertible facility led by Gotham Green Partners.

Just what will this cost? It’s not too far from getting an extremely big credit card. The principal amount of the Incremental Notes will carry an interest rate of 18.0% per annum, to be paid as follows: (a) 12.0% shall be paid in cash monthly in arrears; and (b) 6.0% shall accrue monthly to the outstanding principal as payment-in-kind.

“We are pleased with the continued support from our existing capital partners as we continue our recent track record of execution,” said MedMen Executive Chairman, Ben Rose. “The financing package is a significant milestone for the company and is a reflection of the commitment the Company has made to strengthen the balance sheet, accelerate its path to profitability and sustainability, and focus on its core retail business. We look forward to continuing to expand the MedMen brand.”

On September 16, 2020, MedMen closed on an initial $1 million, and has the right to call additional tranches, totaling a million each, no later than 20 trading days from receiving each tranche. Participating lenders will receive a $468,564 fee with a conversion price of $0.20 per share, consistent with the terms of the Facility. MedMen shares were recently selling at $0.17 per share on the OTC marketplace. MedMen has said it will announce its earnings on September 28 after the market closes.

Company Update

While MedMen has struggled over its leadership problems and mountain of debt, it continues to press forward. The company recently noted that it is has 25 retail stores that are in operation across California, Nevada, Illinois, Florida, New York, and Arizona. On August 3, 2020, the City Council of West Hollywood adopted an urgency ordinance to create a new “Legacy Cannabis Business License” which will permanently allow for both medical and adult-use sales of cannabis by MedMen West Hollywood and the three other pre-existing medical operators, bringing the collaborative efforts between the City of West Hollywood and other related parties to a final resolution.

On August 6, 2020, the Massachusetts Cannabis Control Commission voted in favor of granting MedMen Boston, LLC, a subsidiary of the Company, a provisional adult-used license for its proposed flagship retail location near Fenway Park. A final license for this location is subject to meeting various conditions prior to opening, which is expected to occur in 2021.

“The positive licensing developments in West Hollywood and Boston are a result of the Company’s commitment to meaningful engagement with local regulators and the communities we are privileged to serve,” said MedMen Executive Chairman Ben Rose. “We continue forward momentum as we execute on our turnaround plan, strengthen our retail footprint and improve four-wall economics. Through our focus on retail, we have made significant progress in optimizing our business model and improving our presence as partners and neighbors in our locations as we expand the MedMen brand in existing and new markets across the U.S.”