Highlights;
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AYR Wellness Inc. has secured a senior secured bridge term loan agreement providing up to $50 million in funding to support ongoing operations and facilitate the restructuring of its core business under a previously announced Restructuring Support Agreement (RSA) dated July 30, 2025.
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The bridge loan was entered into by CSAC Holdings Inc. (a wholly-owned subsidiary of AYR), the lenders, Acquiom Agency Services LLC (as administrative and collateral agent), and certain AYR subsidiaries as guarantors.
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Key Use of Funds:
- Tranche A: For working capital, general corporate purposes, sale transaction expenses, and restructuring costs.
- Tranche B: To fund the court-supervised wind-down of non-core assets.
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The bridge facility is secured by all present and future assets of the borrower and guarantors, with liens ranking pari passu with AYR’s outstanding senior secured notes.
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Interest and Maturity:
- Loans bear an interest rate of 14% per annum, payable in kind (PIK) and capitalized monthly.
- Tranche A matures on the earlier of 60 days after closing, November 16, 2025, or customary acceleration events.
- Tranche B matures on the earlier of 95 days after the consummation of the sale transaction or February 19, 2026.
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The agreement includes customary covenants such as maintaining cannabis licenses, restrictions on additional indebtedness, and weekly cash-flow reporting. It also imposes a minimum liquidity covenant of $17.5 million, tested weekly.
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Events of Default include payment defaults, covenant breaches, cross-defaults, and failure to meet restructuring milestones.
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On the effective date of the sale transaction, the outstanding principal and accrued interest under the bridge facility will roll into a new senior secured “take-back” term facility issued by the purchaser entity acquiring AYR’s core business.
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The agreement includes premiums: a 10% commitment premium, 10% exit premium, and 15% backstop premium, all payable in kind and exchangeable for equity in the post-sale entity at the lenders’ discretion.
[PRESS RELEASE] – MIAMI, Aug. 29, 2025 – AYR Wellness Inc. (together with its affiliates and subsidiaries, collectively referred to as the “company”), a leading vertically integrated multistate cannabis operator, today announced that it has entered into a definitive senior secured bridge term loan agreement. This agreement provides the company with up to $50 million in committed funding to support its ongoing operations and facilitate the orderly transition of its core business in accordance with the previously announced restructuring support agreement (RSA) dated July 30, 2025.
Key Details of the Agreement:
- Parties Involved: The agreement was entered into by CSAC Holdings Inc. (the “borrower”), an indirect wholly-owned subsidiary of AYR Wellness Inc., the lenders (collectively, the “lenders”), Acquiom Agency Services LLC as administrative agent and collateral agent (the “agent”), and certain AYR subsidiaries as guarantors.
Statement from AYR’s Interim CEO:
- Scott Davido, AYR Interim CEO, remarked, “The execution of this bridge credit agreement represents a significant milestone in our restructuring efforts. It provides the necessary funding to advance our restructuring plan, ensure the continuity of operations, and preserve the value of our core assets for the benefit of all stakeholders. We appreciate the continued support of our noteholders and look forward to completing the sale transaction outlined in the RSA.”
Terms of the Bridge Credit Facility:
- Facility Details: The bridge credit agreement provides for a senior secured term loan facility with a total aggregate principal amount of up to $50 million. The facility is divided into initial term loans (Tranche A and Tranche B) and delayed draw term loans (Tranche A).
- Use of Proceeds:
- Tranche A Loans: Proceeds will be used to fund working capital, general corporate purposes, and the expenses related to the sale transaction and restructuring costs. These uses are subject to a 13-week cash-flow budget approved by the required lenders (lenders holding at least a majority of the aggregate commitments under the bridge facility).
- Tranche B Loans: Proceeds will be allocated to fund the court-supervised wind-down of the company’s non-core assets, subject to a wind-down budget similarly requiring approval by the required lenders.
- Security: The bridge facility is secured by all present and future acquired assets of the borrower and guarantors. These liens rank pari passu with the liens securing AYR’s outstanding senior secured notes, as outlined in an equal-priority intercreditor agreement entered into concurrently with the bridge loan agreement. The facility is senior to all unsecured indebtedness, though it is not convertible into equity, except as described below.
Financial Terms:
- Interest Rate: The loans bear an interest rate of 14% per annum, which is payable in kind (PIK) and capitalized on the last business day of each calendar month.
- Maturity:
- Tranche A Loans: Maturity is the earlier of (i) 60 days after the closing date, (ii) November 16, 2025, or (iii) certain accelerated maturity events related to the sale transaction or events of default.
- Tranche B Loans: Maturity is the earlier of (i) 95 days after the consummation of the credit-bid sale under Article 9 of the Uniform Commercial Code (the “sale transaction”) and (ii) February 19, 2026. All obligations under the bridge facility are subject to customary acceleration upon an event of default.
Premiums and Additional Terms:
- Commitment Premium: 10% of the aggregate commitments, payable to certain backstop parties.
- Exit Premium and Backstop Premium: 10% and 15% of the aggregate commitments, respectively, also payable to certain backstop parties. All premiums are fully earned on closing, payable in kind, and may be exchanged for equity in the post-sale entity at each lender’s discretion, in accordance with the RSA.
Covenants and Defaults:
- Covenants: The agreement includes customary affirmative and negative covenants, such as maintaining cannabis licenses, restrictions on additional indebtedness, liens, asset sales, and investments, as well as weekly cash-flow reporting, variance testing, and milestone covenants. The company must also maintain a minimum liquidity covenant of $17.5 million, tested weekly.
- Events of Default: Includes payment defaults, covenant breaches, cross-defaults, insolvency events, change of control, termination events under the RSA, and failure to meet specified restructuring milestones.
Post-Sale Transaction:
- On the effective date of the sale transaction, all outstanding principal and accrued PIK interest under the bridge facility will automatically roll into a new senior secured “take-back” term facility issued by the purchaser entity acquiring the company’s core business through the Article 9 sale process outlined in the RSA.
