Ms. Allison McLarty reports

MEDMEN ANNOUNCES INCREASED COMMITMENT FROM GOTHAM GREEN PARTNERS

Medmen Enterprises Inc. has signed a binding term sheet in respect of certain amendments to the definitive agreements for the up to $250-million (U.S.) senior secured convertible credit facility led by Gotham Green Partners, an investor in the global cannabis industry. Concurrent to the amendments, Gotham Green Partners, with participation from Wicklow Capital, has agreed to an additional $30-million (U.S.) equity commitment, bringing the total financing commitment to $280-million (U.S.). To date, Gotham Green Partners has financed $100-million (U.S.) of the total commitment.

"Both Gotham Green and Wicklow have shown continued confidence in our strategy and recognize the potential ahead," said Adam Bierman, Medmen co-founder and chief executive officer.

In addition to financing general working capital, the increased financing commitment will primarily be used to:

• Operationalize the balance of the company's retail licences; the company is licensed for up to 86 retail stores across the United States, of which 37 are operational today (including the footprint to be acquired through pending acquisitions, subject to customary regulatory approvals);
• Focus on strategic markets, such as Illinois, where the company anticipates 10 stores after the state transitions from a medical to adult-use market in 2020 and pending regulatory approvals associated with the PharmaCann acquisition;
• Continue expanding the retail presence in Florida, where the company expects to open 11 additional stores in 2019;
• Remain opportunistic with respect to selective growth initiatives such as expanding the company's retail footprint and investing in its delivery and loyalty platforms;
• Strengthen the company's balance sheet.

"Medmen's strategy, brand and performance makes them the clear leader of cannabis retail in the U.S. and we are supportive of management's vision and plan for growth and profitability," said Jason Adler, managing member of Gotham Green Partners. "As their primary capital partner, we will continue to support the company as they bring their iconic brand to new markets."

Among other amendments, it is contemplated that the terms and conditions of the facility will be amended such that:

• The trading price thresholds in respect of the Class B subordinate voting shares of the company in order to access tranche 2 and tranche 3 of the facility will be eliminated, giving the company full access to the $250-million (U.S.) facility.
• The conversion price per share of the senior secured convertible notes in the aggregate principal amount of $100-million (U.S.) co-issued by the company and MM CAN USA Inc., a subsidiary of the company, pursuant to tranche 1 of the facility, will be changed from $3.29 (U.S.) to $2.55 (U.S.), which represents a 12-per-cent premium over the company's 20-trading-day volume-weighted average price as of July 8, 2019.
• The method for calculating the conversion price per share of the notes issuable pursuant to tranches 2 and 3 of the facility (which are each in the principal amount of $75-million (U.S.) and which have not yet been issued), will be changed from being equal to:
  • The lesser of (i) 115 per cent of the 20-trading-day volume-weighted average trading price (VWAP) of the subordinate voting shares as of the trading day immediately preceding the date of issue of the applicable tranche, and (ii) $7 (U.S.);
  • The lesser of (i) the 20-trading-day VWAP of the subordinate voting shares as of the trading day immediately preceding the date the applicable tranche is called by the company, (ii) the 20-trading-day VWAP of the subordinate voting shares as of the trading day immediately preceding the date of issue of the applicable tranche, and (iii) $2.55 (U.S.).
• The company will be able to force the conversion of up to 75 per cent of the then outstanding notes under the facility if the VWAP of the subordinate voting shares is at least $6.20 (U.S.) for any 20-consecutive-trading-day period, at a conversion price per share equal to $6.20 (U.S.), with both the forced conversion share price threshold and the conversion price per share being reduced from $8 (U.S.).

It is expected that receipt of the initial portion of tranche 2, in the aggregate principal amount of $25-million (U.S.), will be completed in the coming days. Notes in connection with this portion of tranche 2 will have a conversion price per share determined in accordance with the amended method noted above.

As a facility amendment fee, 15 per cent of the outstanding principal amount of the facility will be added to the balance of the facility on the effective date of the facility amendments (such outstanding principal amount is anticipated to be $125-million (U.S.), given the anticipated completion of the initial portion of tranche 2 noted above). This amendment fee will be cancelled in the event that either (i) the facility balance excluding the amendment fee is paid in full (inclusive of any other required fees or premiums), or (ii) a lender under the facility elects to convert any portion of the facility and the trading price of the subordinate voting shares at the time of conversion is above $2.95 (U.S.).

In addition, Gotham Green Partners and Wicklow Capital have committed to a $30-million (U.S.) non-brokered financing of subordinate voting shares at a price equal to $2.37 (U.S.) per share. The equity placement is conditional upon the satisfaction of customary conditions, including but not limited to the receipt of all necessary approvals.

Please refer to the company's news releases dated April 23, 2019, and May 23, 2019, and to other documents available on the company's profile for additional details as to the facility.

The terms of the facility amendments and of the equity placement described in this new release are set out in a binding term sheet and not within definitive documentation. As a result, completion of any such amendments and of the equity placement are subject to further terms and conditions, including representations, warranties, covenants and conditions, and other agreements being entered into by the applicable parties. The terms of the facility amendments and of the equity placement are subject to change as the parties negotiate such definitive documentation. The completion of the facility amendments and of the equity placement will be subject to certain conditions being satisfied including but not limited to the receipt of all necessary approvals. The parties are currently anticipating amending the facility and completing the equity placement in July or August. There can be no assurance that the parties will enter into definitive documentation such that the facility will be amended or the equity placement will be completed as described herein, or if definitive documentation is entered into, that the terms of the facility amendments and the equity placement will be as stated above.

About Medmen Enterprises Inc.

Medmen is a cannabis retailer with operations across the U.S. and flagship stores in Los Angeles, Las Vegas and New York. Medmen's mission is to provide an unparalleled experience that invites the world to discover the remarkable benefits of cannabis because a world where cannabis is legal and regulated is a safer, healthier and happier world.

We seek Safe Harbor.