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Jushi Holdings Closes Acquisition Of Pennsylvania Medical Solutions

Jushi Holdings, a Florida-based cannabis and hemp operator, said it has closed its previously announced deal to acquire the entire equity of Pennsylvania Medical Solutions, LLC or PAMS, a Pennsylvania grower-processor previously owned by Vireo Health International, Inc.

Upon closing, Jushi paid Vireo $16.3 million in cash, a $3.8 million seller note, and assumed a $17 million facility associated with a long-term lease obligation. The company said no equity was issued in connection with this acquisition.

Jushi funded the cash portion of the deal with the proceeds from the debt financing, which it announced in June and July this year. The deal enables Jushi to expand its presence in Pennsylvania.

Through the acquisition, Jushi has added PAMS as well as its 90,000 square feet. cannabis cultivation and processing facility that is strategically located within minutes of Interstate 81, Interstate 84 and the Pennsylvania Turnpike.

The company noted that the facility will enable efficient wholesale distribution to the 89 dispensaries currently operating across the Commonwealth, including Jushi's eight operational Beyond/Hello dispensaries.

The facility is currently being upgraded to increase the total amount of indoor cultivation area to about 45,000 square feet. The property has the capacity to further upsize the indoor cultivation by an additional 25,000 square feet, bringing the total to 70,000 square feet.

Jushi said that the facility expansion project currently underway is expected to be completed in the third quarter of 2020. The facility produces indoor grown flower, and extracts.

Post-expansion, the facility is expected to produce between 800 to 1,000 lbs. of dried flower per month. The facility is expected to supply Jushi's subsidiaries as well as other licensed retail facilities.

"The acquisition will allow us to provide high-quality, indoor-grown dried flower and concentrates products to the Commonwealth's patients, who continue to experience constrained supply and high prices," said Jim Cacioppo, Chairman and Chief Executive Officer of Jushi.

Upon closing of the deal, Jushi received an assignable purchase option to acquire the entire equity of Pennsylvania Dispensary Solutions, LLC or PADS, a Pennsylvania medical marijuana dispensary permittee in the Commonwealth's Northeast region.

Currently, PADS operates two medical marijuana dispensaries in Scranton and Bethlehem, with the right to operate an additional dispensary in the region. The option will expire eighteen months from closing of the deal.

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