MedMen Provides Update on Sale of Non-Core Assets – Designated News Release

MedMen Provides Update on Sale of Assets

LOS ANGELES–(BUSINESS WIRE)–MedMen Enterprises Inc. (CSE: MMEN) (OTCQX: MMNFF) (“MedMen” or the “Company”), a leading cannabis retailer with operations across the U.S., today announced the execution of term sheets for non-core asset sales (“Non-Core Asset Sales”), as well as the execution of definitive subscription agreements for its previously-announced equity placement (the “Equity Placement”). In total, the Non-Core Asset Sales and Equity Placement are expected to generate aggregate gross cash proceeds of approximately US$74 million.

Non-Core Asset Sales:

On November 15, 2019, the Company announced its intention to raise non-dilutive financing through the sale of certain non-core assets. As of today, the Company has executed a non-binding term sheet for the sale of its Arizona licenses, which include three vertically-integrated licenses, and a binding term sheet for the sale of a cultivation and manufacturing license in Illinois. The Company expects to generate US$54 million in aggregate gross cash proceeds through the divestiture of the non-core licenses. The completion of the sale of Arizona licenses is subject to due diligence, the execution of definitive documentation and customary regulatory approvals. The completion of the sale of the Illinois license is subject to the execution of definitive documentation and customary regulatory approvals.

The Company will continue to explore the sale of other non-core assets and will focus on deepening its retail market share in California, Nevada, Florida, Illinois, Massachusetts and New York.

Equity Placement:

On December 11, 2019, the Company announced the execution of a term sheet for its offering of Class B subordinate voting shares for aggregate gross proceeds of US$27 million at a price per share of US$0.43. Given the acceleration of the timeline for Non-Core Asset Sales, the Company modified the size of the Equity Placement from US$27 million to approximately US$20 million to limit dilution to the Company’s shareholders. As such, the Company has now signed definitive documentation for the offering of 46,962,648 Class B subordinate voting shares, at a price of US$0.43 per share. Certain of the shares to be issued pursuant to the Equity Placement will be subject to a hold period of four months from the closing date. Closing of the Equity Placement is expected to occur in one or more tranches in the coming days.

Proceeds raised from the Equity Placement are contemplated to be used to finance working capital requirements and to execute on the Company’s retail footprint expansion plans in its core geographic markets.

General Disclosure:

This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the United States Securities Act of 1933, as amended, and applicable state securities laws.

The terms of the Non-Core Asset Sales described in this news release are set out in term sheets, and not within definitive documentation. As a result, completion of any such transaction is 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 such transactions are subject to change as the parties negotiate such definitive documentation. The completion of such transactions will be subject to certain conditions being satisfied, including but not limited to, the receipt of all necessary approvals, including regulatory approvals. There can be no assurance that the parties will enter into definitive documentation to complete such transactions, or that if definitive documentation is entered into, that the terms of such transactions will be as stated above or that the transactions contemplated therein will be completed.

About MedMen:

Founded in 2010, MedMen is North America’s premium cannabis retailer. Founders Adam Bierman and Andrew Modlin have defined the next generation discovery platform for cannabis and all its benefits. A robust selection of high-quality products, including MedMen-owned brands [statemade], LuxLyte and MedMen Red, coupled with a team of cannabis-educated associates cement the Company’s commitment to providing an unparalleled experience. MedMen’s industry-leading technology enables a fully compliant, owned-and-operated delivery service and MedMen Buds, a nationwide loyalty program. MedMen believes that a world where cannabis is legal and regulated is safer, healthier and happier. Learn more at www.medmen.com

Source: MedMen Enterprises

Cautionary Note Regarding Forward-Looking Information and Statements:

This news release contains certain “forward-looking information” within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only MedMen’s beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of MedMen’s control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or may contain statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “will continue”, “will occur” or “will be achieved”. The forward-looking information and forward-looking statements contained herein may include, but are not limited to, the anticipated timing for completion of the Equity Placement, the use of proceeds from the Equity Placement, the anticipated terms and anticipated execution of definitive documentation in respect of the Non-Core Asset Sales and related matters.

By identifying such information and statements in this manner, MedMen is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of MedMen to be materially different from those expressed or implied by such information and statements. In addition, in connection with the forward-looking information and forward-looking statements contained in this news release, MedMen has made certain assumptions. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking information and statements are the following: inability to satisfy the conditions precedent to the completion of the Equity Placement; inability of the applicable parties to negotiate mutually acceptable definitive documentation in respect of the Non-Core Asset Sales; inability of MedMen and other applicable parties to satisfy the conditions precedent to the completion of such transactions, including inability to receive the requisite regulatory approvals; changes in general economic, business and political conditions, including changes in the financial markets; changes in applicable laws and compliance with extensive government regulation. Should one or more of these risks, uncertainties or other factors materialize, or should assumptions underlying the forward-looking information or statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected.

Although MedMen believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. The forward-looking information and forward-looking statements contained in this news release are made as of the date of this news release, and MedMen does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws. All subsequent written and oral forward-looking information and statements attributable to MedMen or persons acting on its behalf is expressly qualified in its entirety by this notice.

No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.