Ayr Wellness Secures Debt Reprieve of $69 Million Through Strategic Agreements Amid Acquisitions

MIAMI – Ayr Wellness, a multistate cannabis company, has successfully negotiated agreements to defer principal and amortization payments on debt obligations totaling approximately $69 million by two years. These deferrals were achieved through amendments to vendor notes and promissory notes related to a series of acquisitions. With these latest amendments, Ayr has now extended the payment terms on a cumulative total of $96.9 million of obligations, including previously announced adjustments to vendor notes, promissory notes, and earn-out payments, according to a press release issued on Monday.

The debt agreements affected by the recent amendments pertain to various acquisitions made by Ayr, including the purchase of Pennsylvania-based medical cannabis dispensary operator PA Naturals, the acquisition of New Jersey’s medical marijuana company GSD NJ, and the purchase of Pennsylvania cannabis company CannTech PA. Additionally, promissory notes assumed by certain Ayr subsidiaries, in connection with the GSD and CannTech acquisitions, were amended to favor former minority interest holders. The debt agreements also include Ayr’s acquisition of Illinois-based Herbal Remedies Dispensaries and Pennsylvania cultivator and processor DocHouse.

To secure these amendments, Ayr agreed to interest rate adjustments that will result in a modest increase of approximately 0.5% across the $69 million aggregate principal amount. Furthermore, the company will be paying amendment fees totaling $400,000. Ayr emphasized that the effectiveness of the maturity and amortization deferrals is subject to an amendment to the company’s 12.5% senior notes, extending the maturity date to December 10, 2026, or a later date, or alternatively, an exchange of those notes for new ones.

Earlier this year, Ayr Wellness made headlines when it canceled its planned acquisition of Chicago-based cannabis retail operator Dispensary 33. In February, the company announced layoffs impacting 180 employees and sold assets in Arizona while revealing its intention to acquire assets in Ohio. Currently, Ayr operates in eight states, solidifying its position as a significant player in the rapidly expanding cannabis industry.

The successful negotiations to defer debt payments underscore Ayr Wellness’ proactive approach to managing its financial obligations amid its expansion efforts. These strategic moves allow the company to navigate the evolving regulatory landscape and position itself for long-term success in the cannabis market.