TerrAscend : January 2023 Investor Presentation

INVESTOR

PRESENTATION

January 2023

terrascend.com

(CSE: TER | OTCQX: TRSSF)

(CSE: TER | OTCQX: TRSSF)

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Disclaimer

Investors and prospective investors should rely only on the information contained in the disclosure filings (the "Filings") of TerrAscend Corp. (the "Company" or "TerrAscend"). This presentation is qualified in its entirety by reference to, and must be read in conjunction with, the information contained in Filings. An investor or prospective investor is not entitled to rely on parts of the information contained in this presentation to the exclusion of others, and no person is authorized to provide different or additional information for or on behalf of the Company.

An investment in the securities discussed in this presentation is speculative and subject to a number of risks that should be considered by an investor or prospective investor. Investors and prospective investors should carefully consider the risks described in the Filings. This presentation does not constitute an offering of securities and the information contained herein is subject to the information contained in the Filings. Unless otherwise specified, all monetary amounts in this presentation are in Canadian dollars.

Forward-Looking Information

This presentation contains forward-looking information or statements within the meaning of applicable securities laws. Forward-looking information may relate to the Company's future outlook and anticipated events, plans or results, and may include information regarding the Company's objectives, goals, strategies, future revenue or performance and capital expenditures, and other information that is not historical information. Particularly, information regarding the Company's expectations of performance, achievements, prospects or opportunities, or the markets in which the Company operates, is forward-looking information. Forward-looking information can often be identified by the use of terminology such as "believe," "anticipate," "plan," "expect," "pending," "in process," "intend,"

"estimate," "project," "may," "will," "should," "would," "could," "can," the negatives thereof, variations thereon and similar expressions. In addition, any statements that refer to expectations, intentions, projections or other characterizations of future events or circumstances contain forward-looking information. Forward-looking information contained in this presentation is based on the Company's opinions, estimates and assumptions in light of management's experience and perception of historical trends, current conditions and expected future developments, as well as other factors that management currently believes are appropriate and reasonable in the circumstances. Forward-looking statements in this presentation include, but are not limited to: statements with respect to the anticipated completion of the Transaction and the timing for its completion; the timing for the holding of the TerrAscend Meeting and the Gage Growth Corp. ("Gage") Meeting; the satisfaction of closing conditions which include, without limitation (i) required Gage and TerrAscend shareholder approvals, (ii) certain termination rights available to the parties under the Arrangement Agreement, (iii) obtaining the necessary approvals from the CSE for the listing of TerrAscend's common shares in connection with the Transaction, (iv) anticipated timing for the opening of additional Gage dispensaries, and (v) other approvals and closing conditions contained in the Arrangement Agreement; statements with respect to the anticipated effects of the Transaction on TerrAscend and its strategy going forward and statements with respect to the anticipated benefits associated with the acquisition of Gage. Actual results and developments may differ materially from those contemplated by these statements.

The forward-looking information contained in this presentation represents the Company's expectations as of the date of this presentation or the date indicated, regardless of the time of delivery of the presentation. All of the forward-looking information contained in this presentation is expressly qualified by the foregoing cautionary statements. Potential investors should consult their own professional advisors to ascertain and assess the income tax, legal, risk factors and other aspects of their potential investment in the Company. Risk factors that could cause actual results to differ materially from forward-looking information in this presentation include: the Company's exposure to legal and regulatory risk; the effect of the legalization of adult-use cannabis in jurisdictions where the Company operates on the medical cannabis industry is unknown and may significantly and negatively affect the Company's medical cannabis business; that the medical benefits, viability, safety, efficacy, dosing and social acceptance of cannabis are not as currently expected; that adverse changes or developments affecting the Company's main or planned facilities may have an adverse effect on the Company; that the medical cannabis industry and market may not continue to exist or develop as anticipated or the Company may not be able to succeed in this market; risks related to market competition; risks related to the proposed adult-use and medical cannabis industries and markets including the Company's ability to enter into or compete in such markets; that the Company has a limited operating history and a history of net losses and that it may not achieve or maintain profitability in the future; risks related to the Company's current or proposed international operations; risks related to future third party strategic alliances or the expansion of currently existing relationships with third parties; that the Company may not be able to successfully identify and execute future acquisitions or dispositions or successfully manage the impacts of such transactions on its operations; risks inherent to the operation of an agricultural business; that the Company may be unable to attract, develop and retain key personnel; risks resulting from significant interruptions to the Company's access to certain key inputs such as raw materials, electricity, water and other utilities; that the Company may be unable to transport its cannabis products to patients in a safe and efficient manner; risks related to recalls of the Company's cannabis products or product liability or regulatory claims or actions involving the Company's cannabis products; risks related to the Company's reliance on pharmaceutical distributors, suppliers and skilled labor; that the Company, or the cannabis industry more generally, may receive unfavourable publicity or become subject to negative consumer or investor perception; that certain events or developments in the cannabis industry more generally may impact the Company's reputation or its relationships with customers or suppliers; risks related to insurance; that the Company may become subject to liability arising from fraudulent or illegal activity by its employees, contractors, consultants and others; that the Company may experience breaches of security at its facilities or losses as a result of the theft of its products; risks related to the Company's information technology systems; that the Company may be unable to sustain its revenue growth and development; that the Company may be unable to expand its operations quickly enough to meet demand or manage its operations beyond their current scale; that the Company may be unable to secure adequate or reliable sources of necessary funding; risk related to the available funds of the Company and the use of such funds; risks related to, or associated with, the Company's exposure to reporting requirements; risks related to conflicts of interest; risks related to the reliance on the expertise and judgment of senior management of the Company, and ability to retain such senior management; risks related to the management of growth; risk of litigation; risks related to energy costs; risks related to fluctuations in foreign currency exchange rates; risks related to the Company's potential exposure to greater-than-anticipated tax liabilities; risks related to the protection and enforcement of the Company's intellectual property rights, or the intellectual property that it licenses from others; that the Company may become subject to allegations that it or its licensors are in violation of the intellectual property rights of third parties; that the Company may not realize the full benefit of the clinical trials or studies that it participates in; that the Company may not realize the full benefit of its licenses if the licensed material has less market appeal than expected and the licenses may not be profitable; and any other risks that may be included in the Filings.

Although management has attempted to identify important risk factors that could cause actual results to differ materially from those contained in the forward-looking information in this presentation, there may be other risk factors not presently known to the Company or that the Company presently believes are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking information in this presentation. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers and viewers should not place undue reliance on forward-looking information, which speaks only as of the date made. The forward-looking information contained in this presentation represents the Company's expectations as of the date of this presentation or the date indicated, regardless of the time of delivery of the presentation. The Company disclaims any intention, obligation or undertaking to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required under applicable securities laws.

All of the forward-looking information contained in this presentation is expressly qualified by the foregoing cautionary statements. Investors and potential investors should consult their own professional advisors to ascertain and assess the income tax, legal, risk factors and other aspects of their investment or potential investment in the Company and should carefully consider the risks described in the Filings.

Non-IFRS Measures, Reconciliation and Discussion

Certain financial measures in this presentation are non-IFRS measures, including, Adjusted Gross Profit and Adjusted EBITDA. These terms are not defined by IFRS and, therefore, may not be comparable to similar measures provided by other companies. These metrics have no direct comparable IFRS financial measure. Such information is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. For more information, please see "Non-IFRS Financial Measures" in the Company's Interim MD&A available on www.sedar.com.

Adjusted Gross Profit and the associated margin are non-IFRS measures which management uses to evaluate the performance of the Company's business as it reflects its ongoing profitability. The Company believes that certain investors and analysts use this measure to evaluate a company's ability to service debt and to meet other payment obligations or as a common measurement to value companies in certain industries. The Company measures Adjusted Gross Profit as Gross Profit / (loss) less the cost of a one-time inventory impairments. The associated margin is Adjusted Gross Profit as a percentage of Net Sales.

Adjusted EBITDA and the associated margin are non-IFRS measures which management uses to evaluate the performance of the Company's business as it reflects its ongoing profitability. The Company believes that certain investors and analysts use this measure to evaluate a company's ability to service debt and to meet other payment obligations or as a common measurement to value companies in certain industries. The Company measures Adjusted EBITDA as EBITDA less unrealized gain on changes in fair value of biological assets and other income plus fair value changes in biological assets included in inventory sold, impairments, restructuring costs, purchase accounting adjustments, transaction costs, share based compensation, revaluation of warrants and derivatives liabilities, unrealized loss on investments or foreign exchange, settlement costs related to contractual disputes, and other one-timenon-recurring items. The associated margin is Adjusted EBITDA as a percentage of Net Sales.

Third Party Information

The information contained in this presentation, including information provided by third parties, has not been independently verified and no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness, correctness or timeliness of the information or opinions expressed herein.

(CSE: TER | OTCQX: TRSSF)

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Company

Overview

CSE: TER | OTCQX: TRSSF)

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Company Journey

CA

	Acquired
Initial investment in	Pivoted operations
TerrAscend of $52.5M	to the US Market

Canopy Growth financing $60M

Opened 2nd and 3rd PA dispensaries

Opened 4th California dispensary in Berkeley

Dec. 2020: Closed $140M of debt financing

Jan. 2021:

Raised $175M in non- brokered private placement

2021

Q4

Announced 2021 results:

$210.4M Revenue, $65.6M Adj. EBITDA (31.2% margin), $79.6M cash on

April-

July

2022

NJ begins adult- use sales on April 21, 2022

Aug- Oct

2022

Completed Pinnacle Acquisition for 5 operating dispensaries in Michigan

Introduced Gage and Cookies brands in Pennsylvania

2017	2018	2019
December	October	June

2020 2020/21

March - July Dec/January

balance sheet

Opened 3rd New Jersey dispensary in Lodi in July

Closed $45.5M non-brokered senior secured term loan

2017	2018	2019
Founded	December	September
Incorporated Q1	Awarded NJ Vertically	Acquired
Publicly Listed	Integrated License
May 2017 (CSE: TER)

2020

Q4

First of 3 Apothecarium dispensaries opened in NJ along with processing and cultivation facility

2021

April/May

Opened 2nd NJ Apothecarium in Maplewood

Acquired KCR PA (3

March

2022

Completed

Acquisition of Gage

Cannabis

Dec

2022

Entered into arrangement with Canopy USA, converting CAD$125.5M in debt to equity at ~100% premium to prevailing

Launched as Canadian LP

NJ

(CSE: TER | OTCQX: TRSSF)

PA

Opened 5th California dispensary in Capitola

operating dispensaries)

Acquired HMS Grower / Processor in Maryland

MD

Launched The Apothecarium Mobile App on the Apple App Store

price

Completed amendment to Pennsylvania Loan, bringing cumulative debt reduction to $160M with

total annual interest savings of $15Mp.4

Our Business

Creating a leading, vertically-integrated, North American Operator

2017

Year Founded

~1,200

Total employees

5

U.S. States

10

Canadian Provinces

32

Operating Dispensaries

10

Premium Brands

Broad Wholesale

Distribution

7

U.S. Cultivation & Production Facilities

$67 M

Q3 2022 Net Revenue

36.4%

YoY Quarterly Revenue Growth

46.1%

Q3 2022 Adj. Gross Margin

16.9%

Q3 2022 Adjusted

EBITDA Margin

(CSE: TER | OTCQX: TRSSF)

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