Grown Rogue Terminates Agreement with Blue Zebra Focus on Muskegon, MI Assets
Momentum Public Relations
Press Release: August 2nd, 2019
Grown Rogue International Inc. (CSE:GRIN | OTC:GRUSF) (“Grown Rogue” or the “Company“), a vertically-integrated, multi-state cannabis company with licenses and assets in Oregon, California, and now entering Michigan, announced today the termination of its agreement with Blue Zebra Community LLC (“Blue Zebra“), previously announced on February 25, 2019, relating to the acquisition of certain cannabis assets. The Company elected to terminate the agreement in order to proceed with an alternative operator which will be materially less resource intensive as the Company initially enters the new Michiganmarket.
Grown Rogue will focus energy and resources relating to expansion into Michigan on the recently announced proposed acquisition of Inferno Gardens, Inc. (“Inferno Gardens“), a cannabis operator in Muskegon, Michigan, announced on July 2, 2019. The proposed acquisition of Inferno Gardens will provide Grown Rogue with an expedient and cost effective entry into the Michigancannabis market.
“After careful consideration of the very exciting Michiganmarket, we chose a direction that gives us the opportunity to produce our first harvest in late 2019 and be fully vertically Integrated by 2nd quarter 2020,” said Obie Strickler, CEO and Co-Founder of Grown Rogue.
“We understand the value and timing of the Michiganmarket. Our management team has the experience to expeditiously enter the market with the Muskegon assets and the timing made all the difference in electing to not exercise options with Blue Zebra and instead focus on the Inferno Gardens partnership,” added Mr. Strickler.
In connection with the termination agreement signed with Blue Zebra (the “Termination Agreement“), Grown Rogue has issued to Blue Zebra 2,148,117 common share purchase warrants with an exercise price of $0.44 per share (the “Warrants“). The Warrants expire on June 28, 2023. Grown Rogue will have the right to accelerate the expiry date of 25% of the Warrants during the term if the shares of Grown Rogue close at or above $1.00 per share for a period of twenty (20) consecutive days. An additional 25% of the Warrants will accelerate if the shares of Grown Rogue close at or above $1.50 per share for a period of twenty (20) consecutive days, and the remainder of the Warrants will accelerate if the shares of the Grown Rogue close at or above $2.00 per share for a period of twenty (20) consecutive days. Further, Grown Rogue has granted to Blue Zebra a pre-emptive right to maintain ownership of up to 5% of Grown Rogue’s common shares. The Warrants vest 40% on the issuance date with the remaining Warrants vesting upon certain events relating to the activities of Helios Holdings, LLC in the Michigan cannabis industry.
About Grown Rogue
Grown Rogue International (CSE: GRIN | OTC: GRUSF) is a vertically-integrated, multi-state Cannabis family of brands on a mission to inspire consumers to “enhance experiences” through cannabis. We have combined an expert management team, award winning grow team, state of the art indoor and outdoor manufacturing facilities, and consumer insight based product categorization, to create innovative products thoughtfully curated from “seed to experience.” The Grown Rogue family of products include sungrown, light dep and indoor premium flower, live rosin jars and terp diamonds, infused, indoor and sungrown pre-rolls, live resin and rosin carts, along with chocolate edibles created in partnership with a world-renowned Chocolatier.
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- Published in Cannabis, CBD, Grown Rogue, Marijuana, News Home
Grown Rogue Issued Patent for Nitrogen Sealed Pre-Rolls
Momentum Public Relations
Press Release: July 22, 2019
Grown Rogue International Inc. (CSE:GRIN | OTC:GRUSF) (“Grown Rogue” or the “Company“), a vertically-integrated, multi-state cannabis company with licenses and assets in Oregon, California, and now entering Michigan, announced today the US Patent and Trademark Office awarded Grown Rogue full patent for its innovative “Certified Fresh” Nitrogen Sealed Pre-rolls. The Nitrogen Sealing Process eliminates oxygen through nitrogen injection which preserves the freshness of the flower. The process also vacuum seals the product to lock in freshness.
“There are dozens of premium pre-rolls in the cannabis market, but there is only one innovation that seals with nitrogen and ensures freshness,” said Obie Strickler, CEO and Co-Founder of Grown Rogue.
Several cannabis companies have used nitrogen to seal cannabis in various applications but Grown Rogue is the first to develop a solution to seal a glass tube with nitrogen. “Customers can see the quality of product through the glass and with the nitrogen infusion will know that they can enjoy a truly fresh cannabis experience,” added Mr. Strickler.
Grown Rogue first introduced the “Certified Fresh” Nitrogen Sealed Pre-rolls in January 2018 which drove sales and brand awareness in the Oregon market. Since then, the Nitrogen Sealed Pre-Rolls have become a symbol of the companies’ commitment to Innovation in a competitive marketplace. The company has developed nitrogen sealed 3.5 gram glass flower jars which is also an industry first, but is not currently seeking a patent for that innovation. The detailed overview along with a video showcasing the patented “woosh” sound is available online.
“Customers have a lot of choices when it comes to pre-rolls and cannabis products in general and our innovative “Certified Fresh” Nitrogen Sealed products speak to our unique differentiation in product development and our commitment to empowering consumers to enhance life experiences through cannabis,” added Rob Rigg, EVP Marketing at Grown Rogue.
Several companies have approached Grown Rogue to license the Nitrogen Pre-Rolls in other markets across the United States. “Our plan is to license the technology and process to partners in areas where we do not have near term expansion plans,” said Mr. Strickler. “Like Tesla or Apple, we want to launch technologies across the world that positively impact the consumer experience,” added Mr. Strickler.
About Grown Rogue
Grown Rogue International (CSE: GRIN | OTC: GRUSF) is a vertically-integrated, multi-state Cannabis family of brands on a mission to inspire consumers to “enhance experiences” through cannabis. We have combined an expert management team, award winning grow team, state of the art indoor and outdoor manufacturing facilities, and consumer insight based product categorization, to create innovative products thoughtfully curated from “seed to experience.” The Grown Rogue family of products include sungrown, light dep and indoor premium flower, live rosin jars and terp diamonds, infused, indoor and sungrown pre-rolls, live resin and rosin carts, along with chocolate edibles created in partnership with a world-renowned Chocolatier.
Subscribe to Grown Rogue investor news alerts.
- Published in Cannabis, CBD, Grown Rogue, Marijuana, News Home
This Is Why Grown Rogue International Inc. (CNSX: GRIN) Appears Undervalued
Grown Rogue International Inc. (CNSX: GRIN) share price is yet to paint an accurate picture of the company’s tremendous potential amidst improving fundamentals. Investor sentiments in the stock did take a hit if price action in the first half of the year is anything to go by. Wild price swings saw the stock rally by more than 50% before tumbling to all-time lows.
The plunge came as a surprise as it came at a time when the broader cannabis sector was flying high. In addition, the company has been on an impressive run on the execution of its core business affirming growth metrics and the need for a higher valuation in the market.
Sales Growth
Grown Rogue is enjoying its best run when it comes to sales growth. The company reported a record-breaking quarter depicted by 388% YoYo growth in sales that came in at $834,309. At the end of the quarter, the company projected continued growth throughout the year, relying on expansion plans to key cannabis markets of California, Oregon, and Michigan.
The Company did meet its promise of robust growth on reporting a 125% quarter over quarter increase in sales in Q2 that came in at $1.9 million. Sales growth is indicative of brand strength as well as distribution reach, as the company continues to expand its wings into new markets. The company has since grown from controlling just three cannabis licenses to 22 licenses further affirming its multi-state operations.
“To have gained this brand recognition and sales traction, in what is arguably the world’s most competitive legalized cannabis market, bodes very well for our expansion into California and particularly the newly legalized market in Michigan,” said CEO Obie Strickler.
Sales growth looks set to be the order of the day as the company has expanded its footprint into Michigan as part of its growth strategy. Michigan becomes the third state from which the company will operate in addition to Oregon and California.
The expansion should reduce the company’s reliance on one market for growth. It should also shield it from the effects of a downturn in one market.
Gross margins have also shown signs of improvement helped by robust growth in revenues. Gross margin in the recent quarter improved to $0.4 million, a 20% increase. Margins are likely to continue improving as cannabis prices in Oregon show signs of edging higher as demand continues to outpace supply.
Organic Growth
Grown Rogue has also underscored its push for growth at all cost. The acquisition of Decibel Farms affirms push for inorganic growth even as the company continues to refine its internal operations to accelerate organic growth.
The acquisition of Decibel Farms marks an important milestone in the company’s growth strategy. With the acquisition, the company gains access to a valuable asset poised to strengthen its cannabis cultivation and production capacity further.
According to the Chief Executive Officer, Decibel Farms will bolster Grown Rogue manufacturing capacity in Oregon where demand for cannabis products is on the rise. Production capacity could reach highs of 5,400kg by the end of the year with the scaling of cultivation operations.
“We believe that licenses, assets, and operations are of little value without an experienced team that knows how to cultivate quality cannabis products at scale and build meaningful brands. Our team has been building these core competencies for the past 3 years,” added Jacques Habra, Chief Strategy Officer.
Demand for branded products continues to exceed internal production; one of the reasons the company is turning to acquisition to ramp up capacity.
Grown Rogue Price Analysis
While Grown Rogue has lost a significant amount of market value over the past six months, price action activity indicates potential to bounce back from all-time lows. The C$0.20 mark has since emerged as a crucial support level from where bulls appear to be jostling for positions consequently fuelling a bullish momentum.
Given the descending long-term bear trend and the fact that bears appear to be in control, the stock might have to rally and take out the C$0.24 resistance level, for the short-term momentum to turn bullish. A rally followed by a close above the C$0.24 mark could arouse buying pressure from buyers who have been on the fence.
https://ca.finance.yahoo.com/news/grown-rogue-reports-388-growth-111100202.html
https://ca.finance.yahoo.com/news/grown-rogue-announces-proposed-acquisition-124100831.html
https://ca.finance.yahoo.com/news/grown-rogue-second-quarter-revenue-123800178.html
- Published in Cannabis, CBD, Grown Rogue, Marijuana
Grown Rogue Second Quarter Revenue Increases Sixfold Year-over-Year and 125% Quarter-over-Quarter to $1.9M
Momentum Public Relations
Press Release: July 3, 2019
Grown Rogue International Inc. (CSE:GRIN | OTC: GRUSF) (“Grown Rogue” or the “Company“), a vertically-integrated, multi-state cannabis company, with licenses and operations in Oregon, California, and now entering Michigan, has released its financial and operating results for its fiscal second quarter ended April 30, 2019. The Company’s financial statements and management’s discussion and analysis for the period are available on the Company’s SEDAR profile at www.sedar.com or through the Company’s website at www.grownrogue.com. All amounts are expressed in United States Dollars unless otherwise indicated. Certain metrics, including those expressed on an adjusted basis, are non-IFRS measures.
Financial Highlights
- Second quarter 2019 revenues increased more than six-fold year-over-year, from $0.3 million to $1.9 million. Quarter-over-quarter revenues increased 125%, from $0.8 million in Q1.
- Adjusted Gross Margin2 was ($0.02) million for the quarter and $0.2 million for the year-to-date. Adjusted Gross Margin was $0.4 million for the second quarter (20%) and $0.8 million for the year-to-date (28%)
- Adjusted EBITDA3 was ($1.0) million for the second quarter.
Management Commentary
“Our second quarter revenue results are indicative of the brand strength and distribution reach we have achieved in Oregon and we are taking the same platform to California and Michigan,” said Obie Strickler, CEO of Grown Rogue. “The proposed acquisition of Decibel Farms announced in April is expected to increase our manufacturing capacity in Oregon where we continue to enjoy record demand for our products. Our California distribution license went into effect during the second quarter with revenues expected to commence this month.”
Grown Rogue expects to increase its combined annual flower production capacity in Oregon and Michiganfrom approximately 5,000 lbs (2,300 kgs) currently, to approximately 12,000 lbs (5,400 kgs) by the end of fiscal year 2019 following the anticipated incorporation of Decibel Farms and scaling of its cultivation operations in Michigan. The increased capacity is inclusive of the 40,000 square feet of greenhouse production capacity in Oregon in the proposed Decibel Farm transaction announced in April 2019. Grown Rogue’s anticipated acquisition of the Decibel brand includes Decibel’s “Loud” branded pre-roll which features a unique “painted on” rosin. Grown Rogue plans to introduce this innovative product in the California market in the third calendar quarter of 2019.
Qualitative Performance Factors
“We believe that licenses, assets, and operations are of little value without an experienced team that knows how to cultivate quality cannabis products at scale and build meaningful brands. Our team has been building these core competencies for the past 3 years,” added Jacques Habra, Chief Strategy Officer.
Grown Rogue has received recognition at regional cannabis competitions for “Highest Percentage THC”, “Highest Percentage Terpenes”, as previously announced in a press release on January 8, 2019. This recognition for cultivation excellence are the foundation of the Grown Rogue products that the company intends to bring to California and Michigan.
Grown Rogue current multi-state presence
Well-established in Oregon, Grown Rogue has expanded into California and its third state, the highly populated, limited-license state of Michigan through a partnership agreement
Oregon Operations
- Cultivating 130,000 sq. ft. of canopy in Oregon (including Decibel Farms) including three outdoor and greenhouse farms and a state-of-the-art indoor facility
- Increased outdoor yield from 2018 to 2019 by over 50%
- Increasing market penetration and sales revenue
California Operations
- Expanded into California with a 16,000-square-foot microbusiness facility in Eureka with retail, processing and distribution licensing partnership spanning San Francisco to Los Angeles.
- Secured state and local approval for distribution license and type 6 manufacturing (non-volatile), and local approval for type 7 manufacturing (volatile).
Michigan Operations
- Subsequent to the close of the second quarter a binding LOI was signed to acquire Michiganoperator “Inferno Gardens Inc.” which includes one retail dispensary (referred to as provisional centers in Michigan), a 24,000 sq ft indoor cultivation facility, and a processing/manufacturing center. First sales are anticipated to begin in early 2020.
- As a result of this new agreement with Inferno Gardens originally disclosed in a press release on July 2, 2019, Grown Rogue has elected not to move forward with a previously announced option to acquire alternative Michigan operations as previously announced in a press release on February 25, 2019.
Selected Financial Information (Complete financial tables have been filed on www.sedar.com)
Three Months |
||
Period Ended April 30, |
2019 |
2018 |
(in $000s except per share amounts) |
||
Revenue |
1,885 |
291 |
Adjusted Gross Margin2 |
376 |
(42) |
Adjusted EBITDA3 |
(969) |
(631) |
Net loss |
(1,648) |
(1,097) |
Net loss per share |
(0.02) |
(0.29) |
Cash |
323 |
497 |
Weighted Common Shares Outstanding |
71,891 |
3,774 |
Second Quarter 2019 Financial Overview
Grown Rogue revenue grew to $1.9 million, a 548% increase from revenue of $0.3 million in its second fiscal quarter ended April 30, 2018, and a 125% increase on a consecutive quarterly basis from $0.8 million in Grown Rogue’s first quarter of fiscal 2019. Organic sales growth are driven through the internal sales force, third party distribution, and strengthening of the Grown Rogue brand.
F2019 Q2 Adjusted Gross Margin2 was $0.4 million, or 20% of revenues, a substantial improvement from Adjusted Gross Margin of ($0.04) million for the same period last year. Adjusted Gross Margin improved as a result of the efforts of the Company over the past year to refine its cultivation processes to be more efficient, resulting in lower cost of sales, while also increasing revenue.
General and administrative expenses were $1.3 million for the second quarter of fiscal 2019, compared to similar expenses of $0.6 million for the second quarter of fiscal 2018. The increase in expenses was primarily related to the expanded scope of operations and associated sales, general and administrative support. Grown Rogue’s Adjusted EBITDA3 amounted to ($1.0) million for the three months ended April 30 2019, compared to ($0.6) million for the three months ended April 30, 2018. The increased loss was primarily attributable to infrastructure investments required to support the company’s growth plans.
The Company’s cash and cash equivalents position was $0.3 million as at April 30, 2019. Subsequent the second quarter the Company completed a CAD $1.5 million debenture financing.
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About Grown Rogue
Grown Rogue International (CSE: GRIN | OTC: GRUSF) is a vertically-integrated, multi-state Cannabis family of brands on a mission to inspire consumers to “enhance experiences” through cannabis. We have combined an expert management team, award winning grow team, state of the art indoor and outdoor manufacturing facilities, and consumer insight based product categorization, to create innovative products thoughtfully curated from “seed to experience.” The Grown Rogue family of products include sungrown, light dep and indoor premium flower, live rosin jars and terp diamonds, infused, indoor and sungrown pre-rolls, live resin and rosin carts, along with chocolate edibles created in partnership with a world-renowned Chocolatier.
NOTES:
1. |
|
The Company’s “Cost of sales, less effects of fair value adjustment of biological assets converted to inventory” is a non-IFRS measure that does not have any prescribed meaning by IFRS and that may not be comparable to similar measures presented by other companies. As the Company’s biological assets are developed towards a state where they can be harvested and processed into saleable inventory, the carrying value of these biological assets are adjusted to fair value as at each financial reporting date. Once the biological assets are transferred to inventory based on this value, these fair value adjustments form a component of the value of the inventory, which is subsequently recorded as cost of sales upon final sale. The Company’s cost of sales, less effects of fair value adjustment of biological assets converted to inventory measure attempts to remove these fair value adjustments from cost of sales. The Company believes that this is a useful metric to evaluate its operating performance. |
2. |
|
“Adjusted Gross Margin” is the result of deducting “Cost of sales, less effects of fair value adjustments of biological assets converted to inventory” from revenue for the period. |
Three months ended |
||
April 30, 2019 |
April 30, 2018 |
|
$ |
$ |
|
Revenue |
1,885,115 |
291,026 |
Cost of sales, less effects of fair value adjustments |
(1,509,462) |
(333,472) |
Adjusted Gross Margin |
375,653 |
(42,446) |
3. |
|
Adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”) is not a recognized performance measure under IFRS. The Company defines Adjusted EBITDA as the Company’s net income (loss) for a period, as reported, before interest, taxes, depreciation and amortization, and is further adjusted to remove transaction costs, stock-based compensation expense, accretion expense, gain (loss) on derecognition of derivative liabilities and the effects of fair-value accounting for biological assets and inventory. The Company believes that this is a useful metric to evaluate its operating performance. The following is a reconciliation of the Company’s net income (loss) to Adjusted EBITDA. |
Adjusted EBITDA Reconciliation |
Three months ended |
||||
April 30, 2019 |
April 30, 2018 |
||||
$ |
$ |
||||
Net loss, as reported |
(1,648,446) |
(1,097,275) |
|||
Add back costs of goods sold, net of the unrealized gain on |
1,902,389 |
376,997 |
|||
Less cost of sales, less effects of fair value adjustments of |
(1,509,462) |
(333,472) |
|||
(1,255,519) |
(1,053,750) |
||||
Add back accretion expense, as reported |
12,886 |
30,066 |
|||
Add back amortization of intangible assets, as reported |
8,821 |
4,295 |
|||
Add back amortization of property and equipment, as |
163,801 |
132,922 |
|||
Add back stock-based compensation expense, as reported |
112,080 |
– |
|||
Add back interest expense (recovery), as reported |
(10,772) |
255,109 |
|||
Add back transaction costs |
– |
– |
|||
Less gain on derecognition of derivative liability, as reported |
– |
– |
|||
Adjusted EBITDA |
(968,703) |
(631,358) |
|||
FORWARD LOOKING STATEMENTS
This press release contains statements which constitute “forward‐looking information” within the meaning of applicable securities laws, including statements regarding the plans, intentions, beliefs and current expectations of the Company with respect to future business activities. Forward‐ looking information is often identified by the words “may,” “would,” “could,” “should,” “will,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “expect” or similar expressions and include information regarding: (i) statements regarding the future direction of the Company (ii) the ability of the Company to successfully achieve its business and financial objectives, (iii) plans for expansion of the Company into Michigan and securing applicable regulatory approvals, and (iv) expectations for other economic, business, and/or competitive factors. Investors are cautioned that forward‐looking information is not based on historical facts but instead reflect the Company’s management’s expectations, estimates or projections concerning the business of the Company’s future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. Although the Company believes that the expectations reflected in such forward‐looking information are reasonable, such information involves risks and uncertainties, and undue reliance should not be placed on such information, as unknown or unpredictable factors could have material adverse effects on future results, performance or achievements of the combined company. Among the key factors that could cause actual results to differ materially from those projected in the forward‐looking information are the following: changes in general economic, business and political conditions, including changes in the financial markets; and in particular in the ability of the Company to raise debt and equity capital in the amounts and at the costs that it expects; adverse changes in the public perception of cannabis; decreases in the prevailing prices for cannabis and cannabis products in the markets that the Company operates in; adverse changes in applicable laws; or adverse changes in the application or enforcement of current laws; compliance with extensive government regulation and related costs, and other risks described in the Company’s public disclosure documents filed on www.sedar.com.
Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward‐looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. The Company does not intend, and does not assume any obligation, to update this forward‐looking information except as otherwise required by applicable law.
Safe Harbor Statement:
This press release may contain forward-looking information within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including all statements that are not statements of historical fact regarding the intent, belief or current expectations of the Company, its directors or its officers with respect to, among other things: (i) the Company’s financing plans; (ii) trends affecting the Company’s financial condition or results of operations; (iii) the Company’s growth strategy and operating strategy; and (iv) the declaration and payment of dividends. The words “may,” “would,” “will,” “expect,” “estimate,” “anticipate,” “believe,” “intend” and similar expressions and variations thereof are intended to identify forward-looking statements. Also, forward-looking statements represent our management’s beliefs and assumptions only as of the date hereof. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the Company’s ability to control, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors including the risk disclosed in the Company’s Form 20-F and 6-K filings with the Securities and Exchange Commission.
The Company is indirectly involved in the manufacture, possession, use, sale and distribution of cannabis in the recreational cannabis marketplace in the United States through its indirect operating subsidiaries. Local state laws where its subsidiaries operate permit such activities however, these activities are currently illegal under United States federal law. Additional information regarding this and other risks and uncertainties relating to the Company’s business are disclosed in the Company’s Listing Statement filed on its issuer profile on SEDAR at www.sedar.com. Should one or more of these risks, uncertainties or other factors materialize, or should assumptions underlying the forward-looking information or forward-looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected.
No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.
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Contact:
For further information on Grown Rogue International please visit www.grownrogue.com or contact: Obie Strickler, Chief Executive Officer, obie@grownrogue.com; Jacques Habra, Chief Strategy Officer, jacques@grownrogue.com; Investor Relations Desk, Inquiries, invest@grownrogue.com
- Published in Cannabis, Grown Rogue, Medical Marijuana, News Home
Grown Rogue Reaches Binding Agreement for Michigan Cultivation, Processing, and Dispensary on West Side
Momentum Public Relations
Press Release: July 2, 2019
Grown Rogue International Inc. (CSE:GRIN | OTC:GRUSF) (“Grown Rogue” or the “Company“), a vertically-integrated, multi-state cannabis company with licenses and assets in Oregon, California, and now entering Michigan, announced today a binding agreement (“Agreement”) to expand further into Michigan through a new strategic acquisition and partnership with experienced cannabis operators in Muskegon. The partnership is with Inferno Gardens, Inc (“Inferno Gardens”), whose assets include the local approval for one retail dispensary (referred to as provisional centers in Michigan) and a 24,000 sq ft indoor manufacturing facility that will include both cultivation and processing when fully constructed. State licensing is in progress and expected to be completed in the coming months. The facility is approximately 40% constructed and expected to be fully operational within 120 days. Final acquisition and partnership is subject to Michigan regulatory approval and full licensing of Grown Rogue at the state level.
The terms of the Agreement include the following provisions:
- Grown Rogue obtains the option to acquire a 51% ownership of Inferno Gardens, subject to state regulatory approval, for a one-time payment of $250,000 due upon the signing of the definitive agreement with a deposit of $50,000 submitted in conjunction with the execution of the Agreement;
- Grown Rogue will provide up to $2MM in financing as a loan for development and operational build-out of the cultivation, processing, and dispensary centers of which Grown Rogue will be paid back under an established schedule;
- Grown Rogue will have the right to purchase the remaining 49% of Inferno Gardens for either stock or cash or a combination of both at the earlier of Grown Rogue stock reaching $1.00 / share on the Canadian Securities Exchange for a period of 10 consecutive days or 24 months from signing the Definitive Agreement. Unless Inferno Gardens permits, Grown Rogue may not exercise this option for a period of 12 months following the signing of the definitive agreement.
- Grown Rogue will also issue 900,000 common shares to Inferno Gardens based on milestones including signing of definitive agreement, production of 500 lbs of dried cannabis flower and achieving $3,000,000.00 in top line revenue.
“The cultivation facility, pending all regulatory approval, is targeted to be fully operational by the end of the fourth quarter of this year with first revenue anticipated in early first quarter of 2020,” explained Obie Strickler, Grown Rogue CEO. “Given that current Michigan market rates for quality cannabis flower fetches around $3000/lb, this new revenue source bodes well for our company’s revenue targets. We are excited to partner with Jesse and the rest of his team at Inferno Gardens and bring our proven business model and brand to the Michigan market. “
The binding Agreement also considers the appointment of Inferno Gardens leadership to a management role for oversight of the development and operation of the Michigan facilities. Plans for the dispensary and processing facility are slated for launching in early 2020.
The Company believes the Muskegon location is ideal with the facilities positioned on a popular corridor that see millions of locals and visitors passing through each year en route to Lake Michigan.
“Our positive relationship with the City of Muskegon and local community has been very helpful in advancing our licensing and development initiatives,” shared Mr. Jesse Sproat, CEO of Inferno Gardens. “The partnership with Grown Rogue adds tremendous credibility and allows us to accelerate our go to market plans.” According to the Detroit Free Press, A significant portion of Muskegon County as well as several neighboring Counties have opted out of the cannabis program in Michigan. (1) “Since Muskegon is such a popular destination for locals and tourists, our vertically integrated operation will soon be online to cater to the growing consumer base enjoying Michigan State Parks,” added Mr. Sproat.
Michigan is the 2nd largest medical cannabis population in the United States with the highest per capita medical patient registrations. The State passed the recreational vote in November 2018, and expects a minimum of two years to fully convert the regulations to be in compliance for recreational adult use.(2)
“Our facility in Muskegon will have the capacity to produce approximately 4,000 lbs (~1814 kg) yearly of premium cannabis. This translates to $13-14 million in yearly revenue using today’s average market prices in Michigan,” stated Jacques Habra, Chief Strategy Officer of Grown Rogue. “We expect demand for high quality cannabis products in Michigan to continue to oustrip supply for many years.”
About Grown Rogue
Grown Rogue International (CSE: GRIN | OTC: GRUSF) is a vertically-integrated, multi-state Cannabis family of brands on a mission to inspire consumers to “enhance experiences” through cannabis. We have combined an expert management team, award winning grow team, state of the art indoor and outdoor manufacturing facilities, and consumer insight based product categorization, to create innovative products thoughtfully curated from “seed to experience.” The Grown Rogue family of products include sungrown, light dep and indoor premium flower, live rosin jars and terp diamonds, infused, indoor and sungrown pre-rolls, live resin and rosin carts, along with chocolate edibles created in partnership with a world-renowned Chocolatier.
- Published in Cannabis, Grown Rogue, Marijuana, News Home
Grown Rogue Announces Ticker Symbol GRUSF on OTC Exchange
Momentum Public Relations
Press Release: May 14, 2019
Grown Rogue International Inc. (CSE: GRIN | OTC: GRUSF) (the “Company” or “Grown Rogue“) reports that the Financial Industry Regulatory Authority (FINRA) has accepted Grown Rogue’s request for a ticker symbol change on the Over the Counter Bulletin Board (OTCBB) from “NVSIF” to “GRUSF”. The Company’s symbol on the Canadian Securities Exchange (CSE) remains unchanged as “GRIN” for Grown Rogue International, Inc. There is no action required by current shareholders in connection with this change.
“An increasing number of United States based investors are looking for investment opportunities in the cannabis sector such as Grown Rogue and our symbol name change on the OTC to GRUSF (Grown Rogue United States) provides improved clarity for US investors looking to buy shares of Grown Rogue which are listed on the CSE,” said Obie Strickler CEO and Co-Founder of Grown Rogue. “In addition to the CSE we are now quoted in US dollars on the OTC for US investors under our new symbol “GRUSF”.
Grown Rogue is now operating or managing assets in three States: Oregon, California, and Michigan. The symbol name change follows the Company’s reverse takeover in November, 2018. The Company indicated no immediate plans to establish the stock for trading on additional exchanges, though the Company anticipates that a Frankfurt listing could soon be in the works.
“Most of our investors are US-based, and increasingly more retail US-based investors have been reaching out through our website and social media channels asking about how they can participate in our growth,” said Jacques Habra, Chief Strategy Officer of Grown Rogue.
Mr. Habra continued, “We have a dedicated office to investor relations that is based in Santa Barbara, California. We expect to hold investor conference calls and eventually an investor only conference as we continue to scale the company across the Country.”
Grown Rogue recently announced the intent to acquire Decibel Farms, owners of the Loud Cannabis Brand, and also announced record monthly revenue of just over $1.01 MM for April, 2019.
“Our vision is that our brand and ticker symbol will be synonymous with a responsible cannabis company focused on value creation,” added Mr. Strickler.
About Grown Rogue
Grown Rogue International Inc. (CSE: GRIN | OTC: GRUSF) is a vertically‐integrated, multi‐state cannabis company curating innovative products to provide consumers with the right cannabis experience. Each of Grown Rogue’s products and strains are categorized and marketed based on unique effects and designed for the full range of a consumer’s lifestyle. Grown Rogue is scaling the vertically integrated model into multiple states by incorporating best‐in‐class manufacturing facilities and a proprietary distribution platform based on Microsoft technology. Grown Rogue’s diverse cannabis product suite includes premium flower, patent‐pending nitrogen sealed pre‐ rolls, oil and concentrates, and edibles featuring a partnership with world‐renowned chocolatier, Jeff Shepherd.
- Published in Cannabis, Grown Rogue, Marijuana, News Home
Grown Rogue Talks Growth Strategy in Exclusive Interview — CFN Media
Momentum Public Relations
Interview: May 13, 2019
CFN Media Group (“CFN Media”), the leading agency and financial media network dedicated to the North American cannabis industry announces publication of an article and video interviewdiscussing Grown Rogue International Inc. (CSE: GRIN) (OTC Pink: GRUSF). CFN recently caught up with Jacques Habra, CSO of Grown Rogue, to discuss what sets the company apart from the competition.
Multi-state operators, or MSOs, have become increasingly common across the United States given their economies of scale. With the industry’s relatively easy access to capital, many of these MSOs have bought up assets at all costs to rapidly build a footprint. Investors may want to avoid some of these companies and seek out those that have pursued thoughtful expansion that’s more focused on return on investment and longevity.
Cannot view this video? Visit:
https://www.youtube.com/watch?v=gfpHqdAApCs
Let’s take a closer look at some of the key points in the video and why investors may want to take a closer look at the stock over the coming quarters.
‘Thoughtful Expansion’
There is no shortage of multi-state operators for investors to choose from, but many are focused on ‘growth at all costs’. While this approach may work out for a handful of companies, it could leave many shareholders extremely diluted or companies saddled with debt. The best MSO opportunities are companies that take a more thoughtful approach to the market with a focus on shareholder return on investment and high-quality portfolio companies.
Grown Rogue is a multi-state operator that’s currently in Oregon, California and Michigan. In each state, the company began by analyzing the regulatory framework to determine the optimal time to build a presence and where to focus. The team then looked for operators and partners that were already established a strong asset portfolio, as well as deal terms that provided its shareholders with a compelling return on investment.
These values have been with the company since its inception. Rather than raising millions of dollars and going on an acquisition spree, the company began as a husband-and-wife team that raised a family-and-friends round that was followed by a small seed round. The company proved its business model in Oregon and has since been sought out by experienced operators in other states looking for advice and capital to grow.
‘Cultivation to Experience’
Cultivators and distributors operate under a business-to-business model, but at the end of the day, it all comes down to the consumers. Consumer preferences and demand creates a pull for certain high-quality products and brands through the entire supply chain. This means that it’s very important for all cannabis companies-even B2B companies-to focus on cannabis consumers and maximizing their experiences.
To this end, Grown Rogue coined the term C2E, or cultivation to experience, which is a play off of the traditional seed-to-sale business model. Rather than focusing on a sale, the company focuses on the consumer’s experience of the product. The goal is to create products that elicit the right experience for consumers every time, whether it’s a better hike, less anxiety, better sleep, or less pain following a workout.
The company has focused on improving by keeping a tight feedback loop. Using direct to consumer surveys, the company has matched up its products to the right experiences and ensured made it easier for retailers to make recommendations. Interviews with intake managers and budtenders has also uncovered customer objections and helped improve product development over time.
Please follow the link to read the full article and see the full video on CFN: http://bit.ly/2JBwIWX
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For Visitors and Viewers
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CFN Media is a leading agency and financial media network dedicated to the cannabis industry. We help private, pre-public and public cannabis companies in the US and Canada attract capital, investors and media attention.
Our powerful digital media and distribution platform conveys a company’s message and value proposition directly to accredited and retail investors and national media active in the North American cannabis markets.
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Disclaimer
The above article is sponsored content. Emerging Growth LLC, which owns CannabisFN.com and CFN Media, has been hired to create awareness. Please follow the link below to view our full disclosure outlining our compensation: http://www.cannabisfn.com/legal-disclaimer/
Grown Rogue Contact
Jacques Habra
Chief Strategy Officer
Mobile: 805.570.6777
Email: jacques@grownrogue.com
Website: www.grownrogue.com
- Published in Cannabis, Grown Rogue, Marijuana, News Home
Grown Rogue International Inc. Delivers Record Sales in April Boosted by Bulk Orders
Momentum Public Relations
Press Release: May 9, 2019
Grown Rogue International Inc. (CSE: GRIN | OTC: GRUSF) (the “Company“) reports record sales of approximately US$1.0m in April, more than three times the average monthly revenue achieved during the Company’s fiscal first quarter ended January 31, 2019. Sales were boosted by new bulk wholesale orders during its fiscal second quarter ended April 30, 2019.
“Grown Rogue continues to gain recognition in the hyper-competitive Oregon market at the retail dispensary level, and recently at the bulk wholesale level as well,” explained Obie Strickler, CEO of Grown Rogue. “Bulk wholesale transactions helped boost our April sales as market demand for quality product is beginning to outstrip supply in some regions. We are hearing from our accounts that sourcing product is becoming the challenge in Oregon, not finding demand for it. Our recent LOI for the acquisition of Decibel Farms was part of our solution to increase our production to meet this growing demand for our products. We believe that the previously over-supplied Oregon market – widely considered the most competitive in North America – is reaching an equilibrium which could drive prices up.”
The Company continues to explore bulk sales opportunities as it can drive large revenue gains with sound margin, but budgeting conservatively as the nature of the bulk business can be inconsistent.
Through a dual strategy of organic and acquisitive growth the Company has been expanding operations in each of the multiple States where its operations or assets exist including Oregon, California and Michigan. Organic growth in Oregon is being complemented with attractively priced acquisition targets such as the recently announced intent to acquire of Decibel Farms.
Grown Rogue’s Michigan priorities are focused on establishing a presence in the adult-use marketplace with current agreements with operational partners that include two retail dispensaries in highly coveted and limited areas (Detroit, Hazel Park) as well as a 19,000 sq ft cultivation center in a Detroit Suburb.
The Company’s California operations are anticipated to come online with Grown Rogue products available this summer. Grown Rogue’s operations in California include distribution teams in northern and southern California and a 16,000 square foot multi-use (cultivation, retail, processing) center in Eureka, California.
“Our team knows how to navigate challenging cannabis market conditions because the early days of legalization in Oregon forced us to rapidly update strategy and tactics to ensure success,” said Jacques Habra, Chief Strategy Officer for Grown Rogue. “As cannabis becomes legal in new states, operators face similar challenges which is where a proven leader like Grown Rogue can excel. This is one of the prime opportunities for our moves into new states. The timing between medical and recreational legalization, which we are now seeing in Michigan and other states we are exploring, requires tactical and effective management.”
About Grown Rogue
Grown Rogue International Inc. (CSE: GRIN | OTC: GRUSF) is a vertically‐integrated, multi‐state cannabis company curating innovative products to provide consumers with the right cannabis experience. Each of Grown Rogue’s products and strains are categorized and marketed based on unique effects and designed for the full range of a consumer’s lifestyle. Grown Rogue is scaling the vertically integrated model into multiple states by incorporating best‐in‐class manufacturing facilities and a proprietary distribution platform based on Microsoft technology. Grown Rogue’s diverse cannabis product suite includes premium flower, patent‐pending nitrogen sealed pre‐ rolls, oil and concentrates, and edibles featuring a partnership with world‐renowned chocolatier, Jeff Shepherd.
- Published in Cannabis, CBD, Grown Rogue, Marijuana, News Home
Grown Rogue International Inc. Announces Closing of Convertible Debenture Private Placement to Accelerate Expansion
Momentum Public Relations
Press Release: May 7, 2019
Grown Rogue International Inc. (CSE: GRIN | OTC: NVSIF) (the “Company“) is pleased to announce the closing of a non-brokered private placement (the “Offering“) of secured convertible debentures with an aggregate principal amount of $1,500,000 (the “Convertible Debentures“). The Convertible Debentures bear an interest at a rate of 2% per calendar quarter and mature on August 10, 2020. The lead investor in the Offering is an experienced private equity cannabis investment fund.
The principal use of funds will be continued expansion investment in the Michigan assets, namely one cultivation center, and two retail dispensaries – including a midtown Detroit location. Additional funds will be dedicated to go-to-market strategies in California featuring Grown Rogue branded products and wholesale products.
The Convertible Debentures are convertible into common shares of the Company (the “Common Shares“) at a conversion price that is the lesser of: (i) $0.44 per Common Share, or (ii) the lowest price for which securities of the Company are issued while such Convertible Debentures remain outstanding (the “Conversion Price“). If, within 90 days of the issuance of the Convertible Debentures, the Company fails to complete an offering of securities for gross proceeds of at least $1,000,000, then the Conversion Price shall be reduced to $0.30 per Common Share.
“Our growth has been ahead of schedule on several fronts. This financing allows us to continue expansion while fulfilling all of our current obligations,” added Obie Strickler, Co-Founder and CEO of Grown Rogue International.
On closing, the Company issued to the purchasers of the Convertible Debentures 3,409,091 common share purchase warrants (the “Warrants“). The Warrants are exercisable for a period of two (2) years from issuance into Common Shares at an exercise price equal to the lesser of (i) $0.55 per Common Share; or (ii) the lowest price for which warrants of the Company are issued while such Warrants remain outstanding. If, during the term of the Warrants, the Company issues warrants with an exercise price below $0.55 per Common Share (the “Other Warrants“), the Company will issue to the purchasers, on the same terms and conditions of the Other Warrants, additional warrants to equal the number of Warrants that would have been issued if the reduced offering price was used to calculate the number of Warrants issued.
“Creating shareholder value is our primary concern when putting investment to work and these funds will pay for immediate operations to advance our operational launch date in Michigan and our product launch date in California,” said Jacques Habra, Chief Strategy Officer of Grown Rogue International. “Building a responsible cannabis brand requires strategic investment,” continued Mr. Habra.
The Convertible Debentures and Warrants issued pursuant to this Offering are subject to a statutory hold period of four months and one day from the closing date of the Offering.
About Grown Rogue
Grown Rogue International Inc. (CSE: GRIN | OTC: NVSIF) is a vertically integrated, multi‐state cannabis company curating innovative products to provide consumers with the right cannabis experience. Each of Grown Rogue’s products and strains are categorized and marketed based on unique effects and designed for the full range of a consumers’ lifestyle. Grown Rogue is scaling the vertically integrated model into multiple states by incorporating best‐in‐class manufacturing facilities and a proprietary distribution platform based on Microsoft technology. Grown Rogue’s diverse cannabis product suite includes premium flower, patent‐pending nitrogen sealed pre‐ rolls, oil and concentrates, and edibles featuring a partnership with world‐renowned chocolatier, Jeff Shepherd.
- Published in Cannabis, Grown Rogue, Marijuana, News Home
Grown Rogue Announces Proposed Acquisition of Decibel Farms, Inc.
Momentum Public Relations
Press Release: April 24, 2019
Grown Rogue International Inc. (CSE:GRIN | OTC: NVSIF) (“Grown Rogue” or the “Company”), a vertically-integrated, multi-state cannabis company, and Decibel Farms, Inc. (“Decibel”), a fully organic and sustainable producer and processor of fine cannabis products in southern Oregon, have executed a binding letter of intent (the “LOI“) which sets out the general terms and conditions pursuant to which Grown Rogue will acquire the assets, including real estate, intellectual property and other assets of Decibel for aggregate consideration of USD$3,000,000, subject to adjustment as described below (the “Transaction”).
Decibel is a family owned and operated, 5-acre sungrown and greenhouse farm located in the Applegate Valley in the heart of Southern Oregon with a 2,500 square foot processing center in Medford, Oregon. Decibel owners Shawn Bishop and Buddy Wilson are veterans of cannabis cultivation. Over the past 3 years, Decibel has built a truly sustainable cultivation facility that utilizes biological cultivation practices and has garnered several prestigious quality awards including:
- 1st place sungrown flower Oregon Growers Cup 2017
- 2nd place Infused Pre-roll Dope Cup 2018
- 3rd Place Sungrown Flower 2018 Oregon Growers Cup
- 2nd Place Solventless Extract 2018 Oregon Growers Cup
In addition to award winning flower, Decibel also distributes award winning infused pre-rolls called “Decibel Louds” and award winning solventless extracts called “Decibel Dabs”. All Decibel products are inline with the company’s primary ethos of clean and responsible cannabis which is in alignment with Grown Rogue’s high standards for sustainable cultivation and environmentally responsible packaging.
Obie Strickler, CEO of Grown Rogue, explained the value of the acquisition stating, “Grown Rogue is continuing to see significant month over month sales growth, such that demand for our award winning products is surpassing our current capacity to deliver in Oregon. This acquisition addresses this demand by immediately adding Decibel’s inventory valued at more than US$1 million wholesale to Grown Rogue’s supply. The acquisition also adds another well respected brand into the Grown Rogue portfolio of brands, enabling us to continue growing our market share. Decibel will expedite our ability to ramp up product supply by adding Decibel’s 40,000 sq ft cultivation and manufacturing capacity, as well as a very experienced management to the Grown Rogue leadership team.”
Upon closing of the Transaction Shawn Bishop will be appointed Vice President of Manufacturing for Grown Rogue and Buddy Wilson will lead Grown Rogue’s sales team as Vice President of Sales.
“Merging operations with Grown Rogue is an incredible opportunity for both companies,” said Shawn Bishop, founder and CEO of Decibel. “We’re very excited to be joining such a skillful and like-minded team with the ability to scale our collective efforts into many other states and markets. The thoughtful approach to strategic expansion demonstrated by Obie and his team inspires great confidence.”
Mr. Strickler added, “There are very good synergies between our teams. Together we are much more capable to extend the proven, vertically integrated platform into additional regions.”
Terms of the Transaction
The Transaction will be structured as a tax-free merger, pursuant to which Decibel will merge with and into Grown Rogue Gardens, LLC, a wholly-owned indirect subsidiary of the Company pending final due diligence and a definitive merger agreement (the “Definitive Agreement“). The real estate property of Decibel will be acquired by GRU Properties, LLC, a wholly-owned indirect subsidiary of the Company, pursuant to a customary commercial real estate acquisition agreement.
The consideration to be paid to the shareholders of Decibel shall consist of: (i) USD$2,000,000 of common shares of the Company, to be issued twelve months from the signing of the Definitive Agreement with respect to the Transaction, with the number of shares to be issued to be determined based on the volume weighted average price of the Company’s common shares as reported by the Canadian Securities Exchange (the “CSE“) for the ten trading days immediately prior to the date that is twelve months from the closing date, up to a maximum of C$1.25 per share; and (ii) up to an additional USD$1,000,000 of common shares on the same terms based on the completion of certain business and operational milestones achieved by the Company. The issuance of the Company’s common shares under the Transaction is subject to compliance with applicable securities laws and the policies of the CSE.
“The terms of this all stock purchase, with share price to be set 12 months out, limits current dilution to our existing shareholders while increasing capacity for product growth and revenue generation. These mandates have been fundamental to our company’s vision to develop strong investor relationships that provide measurable returns,” added Mr. Strickler.
The closing of the Transaction will be subject to, among other things, satisfactory completion of due diligence by the Company, regulatory approvals, and delivery of a definitive merger agreement and other related transaction documents by June 30, 2019.
About Grown Rogue
Grown Rogue International (CSE: GRIN | OTC: NVSIF) is a vertically-integrated, multi-state cannabis company curating innovative products to provide consumers with the right cannabis experience. Each of Grown Rogue’s products and strains are categorized and marketed based on unique effects and designed for the full range of a consumer’s lifestyle. Grown Rogue is scaling the vertically integrated model into multiple states by incorporating best-in-class manufacturing facilities and a proprietary distribution platform based on Microsoft technology. Grown Rogue’s diverse cannabis product suite includes premium flower, patent-pending nitrogen sealed pre-rolls, oil and concentrates, and edibles featuring a partnership with world-renowned chocolatier, Jeff Shepherd.
- Published in Cannabis, Grown Rogue, Marijuana, News Home
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