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Ascend Wellness Holdings Announces US$210 Million Senior Debt Financing

Four-Year Term Bears Interest at 9.5%

Refinances Existing Debt Lowering Cost of Capital

Strengthens Balance Sheet to Support Investment Towards U.S. Growth Strategy

NEW YORK, NY (August 30, 2021) — Ascend Wellness Holdings, Inc. (“AWH” or the “Company”) (CSE: AAWH.U, OTCQX: AAWH), a leading multi-state, vertically integrated cannabis operator, today announced it has closed on a US$210 million Senior Secured Term Loan (the “Term Loan”) with Seaport Global Securities LLC as lead manager. AWH intends to use the proceeds to (i) repay substantially all of the Company’s debt excluding approximately US$12 million of outstanding acquisition payments with near zero interest rates, (ii) finance the Company’s pending investment in MedMen NY, Inc. and (iii) support the Company’s future growth and acquisition initiatives. This Term Loan further strengthens the company’s strong cash position. Prior to closing the Term Loan, at the end of Q2 2021, ending June 30, 2021, the Company had $104.2 million in cash and equivalents.

“I am thrilled to secure this non-dilutive financing which both reduces our overall cost of capital and will fuel the growth of our business as we invest in scaling our strategic footprint. We saw tremendous interest and had healthy participation in the Term Loan.  Our marketing process, lead-managed by Seaport Global Securities, introduced us to a very high-quality mix of institutional investors, family offices and hedge funds.  We are excited to include this new class of stakeholders into our capital structure via the senior debt financing and look forward to the opportunity to expand our relationship with many of these investors over time in future debt and equity financings.” said Abner Kurtin, Founder and CEO of AWH. “We are actively building one of the most robust networks of retail stores and cultivation facilities in the highest quality markets. With our strong balance sheet and successful track record, we are well positioned to implement our growth strategies to take advantage of the significant market opportunity ahead and drive strong value for our shareholders.”

The Term Loan will bear interest of 9.5% per annum, payable quarterly in arrears, with a maturity date of August 27, 2025. The Term Loan is secured by a first lien on all Company assets. Subject to certain conditions of the agreement, the Company has the ability to increase the facility by up to US$65 million if desired.

The placement was lead-managed by Seaport Global Securities LLC and co-managed by ATB Capital Markets.

About Ascend Wellness Holdings, Inc.

AWH is a vertically integrated operator with assets in Illinois, Michigan, Ohio, Massachusetts, and New Jersey. AWH owns and operates state-of-the-art cultivation facilities, growing award winning strains and producing a curated selection of products. AWH produces and distributes Ozone branded products. For more information, visit www.awholdings.com.

Forward-Looking Statements

This news release includes forward-looking information and statements, which may include, but are not limited to, information and statements regarding the plans, intentions, expectations, estimates, and beliefs of the Company. Words such as “expects”, “continue”, “will”, “anticipates” and “intends” or similar expressions are intended to identify forward-looking statements. These forward-looking statements are based on the Company’s current projections and expectations about future events and financial trends, and on certain assumptions and analysis made by the Company in light of experience and perception of historical trends, current conditions and expected future developments and other factors management believes are appropriate.

Forward-looking information and statements involve and are subject to assumptions and known and unknown risks, uncertainties, and other factors which may cause actual events, results, performance, or achievements of the Company to be materially different from future events, results, performance, and achievements expressed or implied by forward-looking information and statements herein. Such factors include, among others: the risks and uncertainties identified in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2021, and in the Company’s other reports and filings with the applicable Canadian securities regulators and the U.S. Securities and Exchange Commission. Although the Company believes that any forward-looking information and statements herein are reasonable, in light of the use of assumptions and the significant risks and uncertainties inherent in such information and statements, there can be no assurance that any such forward-looking information and statements will prove to be accurate, and accordingly readers are advised to rely on their own evaluation of such risks and uncertainties and should not place undue reliance upon such forward-looking information and statements. Any forward-looking information and statements herein are made as of the date hereof, and except as required by applicable laws, the Company assumes no obligation and disclaims any intention to update or revise any forward-looking information and statements herein or to update the reasons that actual events or results could or do differ from those projected in any forward looking information and statements herein, whether as a result of new information, future events or results, or otherwise, except as required by applicable laws.

The CSE has not reviewed, approved or disapproved the content of this news release.

Contacts

Media Contact

MATTIO Communications
Mel Trecha
(724) 513-9342
[email protected]

 Investor Contact
Rebecca Koar
(617) 453-4042 ext. 90102
[email protected]

 

 


AWH Logo

AWH ANNOUNCES Q2 2021 FINANCIAL RESULTS

Q2 2021 Net Revenue Increased 26.1% Quarter-over-Quarter to $83.4 Million

Increases 2021 Full Year Net Revenue Guidance Range to $330-$350 Million

Added Five New Dispensaries YTD, Three During Q2 2021

NEW YORK, NY, August 10, 2021 — Ascend Wellness Holdings, Inc. (“AWH” or the “Company”) (CSE: AAWH.U/ OTCQX:AAWH), a vertically integrated multi-state cannabis operator focused on bettering lives through cannabis, today reported its financial results for Q2 2021, which ended June 30, 2021. Financial results are reported in accordance with U.S. generally accepted accounting principles (“GAAP”) and all currency is in U.S. dollars.

Q2 2021 Financial Highlights

  • Gross Revenue: Total revenue of $97.5 million increased 28.5% quarter-over-quarter and 236.2% year-over-year.
  • Net Revenue: Net revenue, which excludes intercompany sale of wholesale products, increased 26.1% quarter-over-quarter to $83.4 million. Net revenue for the first six months of 2021 was $149.5 million, a 4.0% increase over the Company’s full year 2020 net revenue of $143.7 million.
  • Net Loss: Net loss of $44.9 million during the second quarter of 2021, was primarily driven by a $32.0 million non-cash interest expense related to the Company’s initial public offering (“IPO”) completed in May 2021. This non-cash interest expense was largely driven by a $27.4 million charge related to the beneficial conversion feature of the historical Real Estate Preferred Units that converted in the IPO.
  • Adjusted EBITDA[1]: Adjusted EBITDA of $20.3 million represented a 28.3% increase quarter-over-quarter. Adjusted EBITDA Margin of 24.4% represented a 43 basis point increase compared to the prior quarter.
  • Balance Sheet: As of June 30, 2021, cash and cash equivalents were $104.2 million, and net debt, which equals total debt less cash and cash equivalents was $27.4 million. The Company has engaged Seaport Global to refinance the existing debt to lower the Company’s cost of capital and provide additional cash to support investment.

Management Commentary

“Our business continues to produce impressive quarter-over-quarter revenue and adjusted EBITDA growth as we scale our wholesale and retail operations across the high-quality markets where we operate,” said Abner Kurtin, Founder and CEO of AWH.  “We remain focused on executing, disciplined in our approach to allocating capital, and excited about the trajectory of the Company,” Kurtin added. “As a result, we are pleased to announce that we are increasing our full year net revenue guidance range to $330 million – $350 million.”

Recent Business Developments

Retail Business

  • During the second quarter of 2021, AWH opened three new dispensaries in Boston, Massachusetts, Rochelle Park, New Jersey, and Chicago Ridge, Illinois, which brought the Company’s total to 18 open and operating dispensaries as of June 30, 2021.
  • Total retail revenue increased to $58.0 million for the second quarter of 2021, representing an increase of 27.5% quarter-over-quarter. The growth was driven by increases in transactions at existing stores and the opening of three stores during the quarter.
  • Total transactions increased 39.4% quarter-over-quarter to approximately 573,000. Average value per transaction declined by 8.6% compared to the prior quarter to approximately $101 primarily due to geographic and medical versus adult-use patient mix.

 Wholesale Business

  • Gross wholesale revenue increased to $39.5 million, representing an increase of 30.1% quarter-over-quarter. Net wholesale revenue, after intercompany sales, increased to $25.3 million, representing an increase of 22.9% quarter-over-quarter, which continues to be driven by increased output and pricing at the Company’s cultivation facility located in Barry, Illinois.
  • Pound equivalents sold increased 28.2% quarter-over-quarter and 285.3% year-over-year to approximately 11,040 pounds.
  • Gross revenue per pound equivalent was approximately $3,577, which is slightly up quarter-over-quarter.
  • On May 5, 2021 the Company closed on its acquisition of a cultivation license in Monroe, Ohio.

 Revenue Guidance

Based on the Company’s strong Q2 2021 performance, management is increasing the 2021 full year annual revenue guidance from a range of $320 million to $340 million to a range of $330 million to $350 million. This revised range represents growth of approximately 130% to 145% year-over-year.

(in millions) 2020

Actual

2021

Guidance

Revenue, net $144 $330 – $350

Q2 2021 Financial Overview

Total revenue in Q2 2021 was $97.5 million representing a 28.5% increase quarter-over-quarter and 236.2% year-over-year. Revenue growth was driven by increased cultivation and production activity, new store openings, and increased traffic at open stores.  The Company continues to invest in the build-out and expansion of its cultivation and manufacturing facilities in Illinois, New Jersey, Massachusetts, and Michigan. Additionally, the Company is actively building out additional dispensaries in Massachusetts, New Jersey, and Michigan.

Q2 2021 gross profit was $34.5 million, or 41.4% of revenue, as compared to $29.7 million, or 44.9% of revenue, for the prior quarter.

Q2 2021 Adjusted Gross Profit1 was $39.6 million, or 47.5% of revenue, as compared to $32.6 million, or 49.3% of revenue, for the prior quarter. Adjusted Gross Profit1 excludes depreciation and amortization included in cost of goods sold, as well as non-cash inventory adjustments. Adjusted Gross Profit1 dollars increased 21.6% quarter-over-quarter driven by wholesale production efficiency at the Company’s Barry, Illinois cultivation facility and additional retail stores coming online, partially offset by declines in pricing at the Company’s Athol, Massachusetts cultivation facility due to the bulk sale of lower testing THC product. Adjusted Gross Profit1 margin decreased 174 basis points quarter-over-quarter to 47.5%, primarily driven by realized pricing at the Company’s Athol, Massachusetts cultivation facility.

Total general and administrative expenses for Q2 2021 were $30.6 million, or 36.7% of revenue, as compared to $25.1 million, or 38.0% of revenue, for the prior quarter.

Total other expense was $36.8 million for Q2 2021. The increase was primarily driven by a $27.4 million non-cash interest expense charge related to the beneficial conversion feature of the historical Real Estate Preferred Units recognized in conjunction with the Company’s IPO, as well as $3.6 million incremental non-cash interest recognized upon conversion of the Company’s convertible notes in conjunction with the IPO.

Net loss attributable to AWH for the second quarter of 2021 was $44.9 million, or a loss of $0.30 per basic and diluted common share, primarily driven by $32.0 million of non-cash interest expense related to the IPO, as compared to a net loss of $48.2 million, or $0.45 per basic and diluted historical common unit, for the prior quarter.

Adjusted EBITDA1, which adjusts for tax, interest, depreciation, amortization, stock-based compensation, and other items deemed one-time in nature, was $20.3 million in Q2 2021. This represents a 28.3% increase quarter-over-quarter. This increase was driven by wholesale production efficiency in Barry, Illinois and retail stores coming online, partially offset by declines in wholesale revenue at Athol, Massachusetts cultivation. Adjusted EBITDA1 Margin of 24.4% represented a 43 basis point increase compared to the prior quarter.

Balance Sheet and Liquidity

As of June 30, 2021, the Company had cash and cash equivalents of $104.2 million and total debt outstanding was $131.6 million. Net debt, which equals total debt less cash and cash equivalents was $27.4 million. The Company has engaged Seaport Global to refinance the existing debt to lower the Company’s cost of capital and provide additional cash to support investment.

Non-GAAP Financial Information

This press release includes certain non-GAAP financial measures as defined by the U.S. Securities and Exchange Commission (“SEC”).  Reconciliations of these non-GAAP financial measures to the most directly comparable financial measure calculated and presented in accordance with GAAP are included in the financial schedules attached to this press release. This information should be considered as supplemental in nature and not as a substitute for, or superior to, any measure of performance prepared in accordance with GAAP.

Conference Call and Webcast

AWH will host a conference call on August 10, 2021 at 5:00 p.m. ET to discuss its financial results for the quarter ended June 30, 2021.  The conference call may be accessed by dialing (888) 390-0605 with conference ID 22159427.  A live audio webcast of the call will also be available on the Investor Relations section of AWH’s website at https://awholdings.com/investors/ and will be archived for replay.

About Ascend Wellness Holdings, Inc.

AWH is a vertically integrated operator with assets in Illinois, Michigan, Ohio, Massachusetts and New Jersey.  AWH owns and operates state-of-the-art cultivation facilities, growing award winning strains and producing a curated selection of products.  AWH produces and distributes Ozone branded products. For more information, visit www.awholdings.com.

Additional information relating to the Company’s second quarter 2021 results is available on the Investor Relations section of AWH’s website at https://awholdings.com/investors/, the SEC’s website at www.sec.gov and Canada’s System for Electronic Document Analysis and Retrieval (“SEDAR”) at www.sedar.com.

Cautionary Note Regarding Forward-Looking Information

This news release includes forward-looking information and statements, which may include, but are not limited to, the plans, intentions, expectations, estimates, and beliefs of the Company.  Words such as “expects”, “continue”, “will”, “anticipates” and “intends” or similar expressions are intended to identify forward-looking statements.  Without limiting the generality of the preceding statement, all statements in this press release relating to estimated and projected revenue, expectations regarding production capacity, anticipated capital expenditures, proceeds from sale leasebacks, expansion, profit, product demand, margins, costs, cash flows, sources of capital, growth rates and future financial and operating results are forward-looking statements. We caution investors that any such forward-looking statements are based on the Company’s current projections and expectations about future events and financial trends, the receipt of all required regulatory approvals, and on certain assumptions and analysis made by the Company in light of the experience of the Company and perception of historical trends, current conditions and expected future developments and other factors management believes are appropriate.

Forward-looking information and statements involve and are subject to assumptions and known and unknown risks, uncertainties, and other factors which may cause actual events, results, performance, or achievements of the Company to be materially different from future events, results, performance, and achievements expressed or implied by forward-looking information and statements herein.  Such factors include, among others: the risks and uncertainties identified in the Company’s Supplemented PREP Prospectus dated April 28, 2021, its Base PREP prospectus dated April 26, 2021, and in the Company’s other reports and filings with the applicable Canadian securities filed on its profile on SEDAR at www.sedar.com and with the SEC at www.sec.gov. Although the Company believes that any forward-looking information and statements herein are reasonable, in light of the use of assumptions and the significant risks and uncertainties inherent in such information and statements, there can be no assurance that any such forward-looking information and statements will prove to be accurate, and accordingly readers are advised to rely on their own evaluation of such risks and uncertainties and should not place undue reliance upon such forward-looking information and statements.  Any forward-looking information and statements herein are made as of the date hereof, and except as required by applicable laws, the Company assumes no obligation and disclaims any intention to update or revise any forward-looking information and statements herein or to update the reasons that actual events or results could or do differ from those projected in any forward looking information and statements herein, whether as a result of new information, future events or results, or otherwise, except as required by applicable laws.  The Canadian Securities Exchange has not reviewed, approved or disapproved the content of this news release.

 

Contacts

Media Contact

MATTIO Communications

Mel Trecha

(724) 513-9342

[email protected]

Investor Contact

Rebecca Koar

Vice President, Investor Relations

(617) 453-4042 ext. 90102

[email protected]

Three Months Ended June 30,
(in thousands, except per share amounts) 2021 2020
Revenue, net $

83,367

$

25,384

Cost of goods sold

(48,851)

(13,206)

Gross profit

34,516

12,178

Operating expenses
General and administrative expenses

30,612

9,975

Operating profit

3,904

2,203

Other (expense) income
Interest expense

(36,888)

(2,873)

Other, net

82

(3)

Total other expense

(36,806)

(2,876)

Loss before income taxes

(32,902)

(673)

Income tax expense

(11,995)

(3,632)

Net loss

(44,897)

(4,305)

Less: net income attributable to non-controlling interests

737

Net loss attributable to Ascend Wellness Holdings, Inc. $

(44,897)

$

(5,042)

Net loss per share attributable to Class A and Class B stockholders of Ascend Wellness Holdings, Inc. — basic and diluted(1) $

(0.30)

$

(0.06)

Weighted-average common shares outstanding — basic and diluted(1)

150,341

89,821

 

(1)     Net loss per share and weighted-average common shares outstanding have been computed on the basis of treating the historical common unit equivalents previously outstanding as shares of Class A common stock, as such historical units converted into shares of Class A common stock in the Company’s conversion to a C-Corporation prior to the initial public offering.

 

Six Months Ended June 30,
(in thousands, except per share amounts) 2021 2020
Revenue, net $

149,504

$

47,976

Cost of goods sold

(85,321)

(28,306)

Gross profit

64,183

19,670

Operating expenses
General and administrative expenses

55,758

19,624

Settlement expense

36,511

Total operating expenses

92,269

19,624

Operating (loss) profit

(28,086)

46

Other (expense) income
Interest expense

(44,225)

(5,403)

Other, net

162

3

Total other expense

(44,063)

(5,400)

Loss before income taxes

(72,149)

(5,354)

Income tax expense

(20,971)

(6,069)

Net loss

(93,120)

(11,423)

Less: net income attributable to non-controlling interests

1,097

Net loss attributable to Ascend Wellness Holdings, Inc. $

(93,120)

$

(12,520)

Net loss per share attributable to Class A and Class B stockholders of Ascend Wellness Holdings, Inc. — basic and diluted(1) $

(0.73)

$

(0.14)

Weighted-average common shares outstanding — basic and diluted(1)

128,392

89,821

 

(1)     Net loss per share and weighted-average shares outstanding have been computed on the basis of treating the historical common unit equivalents previously outstanding as shares of Class A common stock, as such historical units converted into shares of Class A common stock in the Company’s conversion to a C-Corporation prior to the initial public offering.

Three Months Ended June 30,
(in thousands) 2021 2020
Net cash used in operating activities $

(4,226)

$

(4,299)

Cash flows from investing activities
Additions to capital assets

(32,695)

(6,135)

Investments in notes receivable

(896)

(400)

Collection of notes receivable

82

Proceeds from sale of assets

26,750

Purchase of businesses, net of cash acquired

(2,456)

Net cash (used in) provided by investing activities

(35,965)

20,215

Cash flows from financing activities

Proceeds from issuance of common stock in public offerings, net

86,065

Proceeds from issuance of debt

12,708

Repayments of debt

(785)

(15,317)

Repurchase of warrants

(4,156)

Repayments under finance leases

(124)

Net cash provided by (used in) financing activities

81,124

(2,733)

Net increase in cash, cash equivalents, and restricted cash

40,933

13,183

Cash, cash equivalents, and restricted cash at beginning of period

63,279

12,713

Cash, cash equivalents, and restricted cash at end of period $

104,212

$

25,896

 

 

Six Months Ended June 30,
(in thousands) 2021 2020
Net cash used in operating activities $

(12,055)

$

(438)

Cash flows from investing activities

Additions to capital assets

(56,046)

(13,696)

Investments in notes receivable

(1,656)

(585)

Collection of notes receivable

164

Proceeds from sale of assets

26,750

Purchase of businesses, net of cash acquired

(13,630)

Net cash (used in) provided by investing activities

(71,168)

12,469

Cash flows from financing activities
Proceeds from issuance of common stock in public offerings, net

86,065

Proceeds from issuance of debt

49,500

12,833

Repayments of debt

(2,071)

(15,317)

Repurchase of warrants

(4,156)

Proceeds from finance leases

3,750

Repayments under finance leases

(206)

Net cash provided by financing activities

129,338

1,060

Net increase in cash, cash equivalents, and restricted cash

46,115

13,091

Cash, cash equivalents, and restricted cash at beginning of period

58,097

12,805

Cash, cash equivalents, and restricted cash at end of period $

104,212

$

25,896

 

 

(in thousands) June 30, 2021 December 31, 2020
Cash and cash equivalents $

104,212

$

56,547

Restricted cash

1,550

Inventory

47,099

28,997

Other current assets

38,087

47,084

Property and equipment, net

182,486

120,540

Operating lease right-of-use assets

101,731

84,642

Intangible assets, net

52,513

50,461

Goodwill

27,341

22,798

Other noncurrent assets

25,294

15,129

Total Assets $

578,763

$

427,748

Total current liabilities $

110,224

$

115,285

Long-term debt, net

104,730

152,277

Operating lease liabilities, noncurrent

174,489

156,400

Total stockholders’ equity

189,320

3,786

Total Liabilities and Stockholders’ Equity $

578,763

$

427,748

 

We define “Adjusted Gross Profit” as gross profit excluding non-cash inventory costs. We define “Adjusted Gross Margin” as Adjusted Gross Profit as a percentage of net revenue.  Our “Adjusted EBITDA” is a non-GAAP measure used by management that is not defined by U.S. GAAP and may not be comparable to similar measures presented by other companies.  We define “Adjusted EBITDA Margin” as Adjusted EBITDA as a percentage of net revenue. Management calculates Adjusted EBITDA as the reported net loss, adjusted to exclude: income tax expense; other (income) expense; interest expense, depreciation and amortization; depreciation and amortization included in cost of goods sold; non-cash inventory adjustments; equity based compensation; start-up costs; transaction-related and other non-recurring expenses; litigation settlement; and loss on sale of assets.  Accordingly, management believes that Adjusted EBITDA provides meaningful and useful financial information, as this measure demonstrates the operating performance of the business.  Non-GAAP financial measures may be considered in addition to the results prepared in accordance with U.S. GAAP, but they should not be considered a substitute for, or superior to, U.S. GAAP results.

The following table presents Adjusted Gross Profit for the three and six months ended June 30, 2021 and 2020:

Three Months Ended June 30, Six Months Ended June 30,
($ in thousands) 2021 2020 2021 2020
Gross Profit $ 34,516 $ 12,178 $ 64,183 $ 19,670
Depreciation and amortization included in cost of goods sold 2,387 627 4,549 1,696
Non-cash inventory adjustments 2,714 3,464
Adjusted Gross Profit $ 39,617 $ 12,805 $ 72,196 $ 21,366
Adjusted Gross Margin 47.5  % 50.4  % 48.3  % 44.5  %

The following table presents Adjusted EBITDA for the three and six months ended June 30, 2021 and 2020:

Three Months Ended June 30, Six Months Ended June 30,
(in thousands) 2021 2020 2021 2020
Net income (loss) $ (44,897) $ (4,305) $ (93,120) $ (11,423)
Income tax expense 11,995 3,632 20,971 6,069
Other (income) expense (82) 3 (162) (3)
Interest expense 36,888 2,873 44,225 5,403
Depreciation and amortization 2,470 1,969 4,889 3,920
Depreciation and amortization included in cost of goods sold 2,387 627 4,549 1,696
Non-cash inventory adjustments 2,714 3,464
Equity based compensation 1,711 85 4,198 270
Start-up costs(1) 1,716 1,845 3,027 3,264
Transaction-related and other non-recurring expenses(2) 5,406 164 7,584 267
Litigation settlement 36,511
Loss on sale of assets 286 286
Adjusted EBITDA $ 20,308 $ 7,179 $ 36,136 $ 9,749
Adjusted EBITDA Margin 24.4  % 28.3  % 24.2  % 20.3  %
  • One-time costs associated with acquiring real estate, obtaining licenses and permits, and other costs incurred before commencement of operations at certain locations.
  • Legal and professional fees associated with the Company’s go-public transaction and other non-recurring expenses.

[1]       Adjusted Gross Profit, Adjusted Gross Margin and Adjusted EBITDA are a non-GAAP financial measures. Please see the “Supplemental Information (Unaudited) Regarding Non-GAAP Financial Measures” at the end of this press release for a reconciliation of non-GAAP to GAAP measures.

[2]      Certificate of Operation to be issued by the Board of Pharmacy at closing.


AWH Logo

Ascend to Bring Lowell Smokes to Illinois on August 5

Just in Time for the Final Weeks of Summer

CHICAGO, Aug. 04, 2021 — Lowell Farms Inc. (CSE:LOWL; OTCQX:LOWLF), a California-born innovator in cannabis cultivation and maker of the legendary brand Lowell Smokes and multi-state, vertically-integrated cannabis operator Ascend Wellness Holdings, Inc. (“AWH”) (CSE: AAWH; OTCQX: AAWH) today announced the long-awaited debut of Lowell Smokes, in Illinois on August 5, 2021. The iconic Lowell Smokes pre-roll pack will initially be available to consumers at eight retail locations throughout Illinois:

  • Ascend by MOCA dispensaries in Logan Square and River North in Chicago;
  • Midway Dispensary locations in Chicago and Chicago Ridge; and
  • Ascend dispensaries in Springfield, Collinsville and Fairview Heights.

In April, Lowell Farms entered into a strategic licensing agreement with AWH to bring the iconic Lowell Smokes brand to Illinois. The collaboration designates AWH, a distinguished pre-roll producer, as Lowell Farms’ wholesale partner. Sold in six-packs of pre-rolls, Lowell Smokes will be available for wholesale purchase and sale at dispensaries throughout Illinois in late August 2021.

“Almost overnight, Illinois has become an incredibly vibrant and exciting cannabis market with some truly exceptional product. We are glad to be partnered with Ascend and their cultivation team to bring Lowell to life in this great state,” says Lowell Farms Inc. Chairman George Allen. “Legalization has been a long time coming in Illinois and we cannot imagine a place we would rather be this summer to celebrate all those that made it happen.”

The relationship advances AWH’s goal of bringing popular West Coast brands to its markets east of the Mississippi River. It also marks the first time Lowell Farms’ products are available outside the state of California.

“Lowell is an iconic brand that we think is an ideal fit with our capabilities in Illinois,” added Abner Kurtin, Founder and Chief Executive Officer of AWH. “We’re thrilled to expand our offering in Illinois with Lowell Smokes’ award-winning pre-rolls.”

Lowell pre-rolls will be available to Ascenders Rewards Club members on Wednesday, August 4th. Upon official launch to the public on August 5th, Illinois consumers will be able to order Lowell Smokes products online at letsascend.com. For more information on Lowell Farms Inc. brands, please visit lowellfarms.com.

ABOUT LOWELL FARMS INC.
Lowell Farms Inc. (CSE:LOWL; OTCQX:LOWLF) is a California-based vertically-integrated cannabis company with advanced production capabilities supporting every step of the supply chain, including cultivation, extraction, manufacturing, brand sales, marketing, and distribution. Lowell Farms grows artisan craft cannabis with a deep love and respect for the plant, and prides itself on using sustainable materials – from seed to sale – to produce an extensive portfolio of award-winning original and licensed brands, including Lowell Herb Co, Cypress Cannabis, MOON, and Kaizen Extracts, for licensed retailers statewide.

ABOUT ASCEND WELLNESS HOLDINGS
AWH is a vertically integrated operator with assets and partners in Illinois, Michigan, Ohio, Massachusetts, and New Jersey. AWH owns and operates state-of-the-art cultivation facilities, growing award-winning strains and producing curated selection of products with effect-based categorization. AWH produces and distributes Ozone branded products. For more information, visit www.awholdings.com.

Lowell Farms Inc. Media Contact
Renata Follmann
[email protected]

Lowell Farms Inc. Investor Relations Contact
Bill Mitoulas
416.479.9547
[email protected]

Lowell Farms Inc. Company Contact
Mark Ainsworth
[email protected]

AWH Media Contact
MATTIO Communications
Mel Trecha
(724) 513-9342
[email protected]

AWH Investor Contact
Rebecca Koar
(617) 453-4042 ext. 90102
[email protected]

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 Lowell Farms’ and AWH’s beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of Lowell Farms’ and AWH’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 ability of Lowell Farms’ and AWH’s to successfully achieve its business objectives and expectations for other economic, business, and/or competitive factors. There can be no assurance that such forward-looking information and statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such forward-looking information and statements. This forward-looking information and statements reflect Lowell Farms’ and AWH’s current beliefs and are based on information currently available to Lowell Farms and AWH and on assumptions Lowell Farms and AWH believes are reasonable.

Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Lowell Farms and AWH to be materially different from those expressed or implied by such forward-looking information. Such risks and other factors may include, but are not limited to: general business, economic, competitive, political and social uncertainties; general capital market conditions and market prices for securities; operating and development costs; competition; changes in legislation or regulations affecting Lowell Farms and AWH; the timing and availability of external financing on acceptable terms; the available funds of Lowell Farms and AWH and the anticipated use of such funds; favorable production levels and outputs; the stability of pricing of cannabis products; the level of demand for cannabis product; the availability of third-party service providers and other inputs for the Lowell Farms’ and AWH’s operations; lack of qualified, skilled labor or loss of key individuals; and risks and delays resulting from the COVID-19 pandemic. A description of additional assumptions used to develop such forward-looking information and a description of additional risk factors that may cause actual results to differ materially from forward-looking information can be found in Lowell Farms’ and AWH’s disclosure documents filed on EDGAR or SEDAR. Although Lowell Farms and AWH have attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. Readers are cautioned that the foregoing list of factors is not exhaustive. Readers are further cautioned not to place undue reliance on forward-looking information as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Forward-looking information contained in this news release is expressly qualified by this cautionary statement.

The forward-looking information contained in this news release represents the expectations of Lowell Farms or AWH as of the date of this news release and, accordingly, is subject to change after such date. However, Lowell Farms and AWH expressly disclaim any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities law.

Neither the Canadian Securities Exchange nor its Regulation Service Provider has reviewed, or accepts responsibility for the adequacy or accuracy of, the content of this news release.