Cannabis company TerrAscend Corp. has applied for a listing on the Toronto Stock Exchange, which would be the first major stock-market membership for a U.S. multistate operator.

Marijuana remains illegal under U.S. federal law, although Washington has looked the other way as many states have legalized the drug for medical or recreational use. Multistate operators, or MSOs, conduct business in several states without engaging in interstate commerce or using the federal banking system.

MSOs thus far have listed their shares over-the-counter or on smaller exchanges such as the Canadian Securities Exchange, but TerrAscend, based in Mississauga, Ontario, is trying to change that. The company will seek shareholder approval for a reorganization in an effort to meet TSX listing requirements, TerrAscend said in a statement Tuesday, with details to come next month.

“We believe that we will qualify for the listing, and the TSX is a major exchange that will bring a lot more liquidity to our listing,” TerrAscend Executive Chairman Jason Wild said in an interview. “The liquidity is sorely needed and doesn’t really exist right now for operators like us.”

TerrAscend shares are up 41 per cent so far this year but plunged 82 per cent last year, joining much of the cannabis industry in tumbling as investors lost patience with the lack of movement toward U.S. federal legalization. A legislative effort to give legal pot companies access to the federal banking system, known as the SAFE Banking Act, failed to advance in Congress late last year, which Wild called a “huge disappointment.”

Other cannabis companies are also trying to find ways around the uncertainty. Canopy Growth Corp., a Canadian company already listed on the TSX, last year tried to accelerate plans to acquire three U.S. entities, but the Nasdaq Stock Market hasn’t blessed that plan yet.

If shareholders approve TerrAscend’s reorganization, Wild said, the TSX listing process “should take months, not quarters — or not multiple quarters.”