Grassroots Cannabis Announces Closing of US $90M Capital Raise

CHICAGO, March 19, 2019 /PRNewswire/ -- Grassroots Cannabis ("Grassroots" or the "Company"), a cannabis company that grows, processes and sells cannabis through its multi-state, vertically integrated business model announces the successful completion of its first capital raise of $90,000,000 at the GR Companies Inc. (holdco) level.

The Company launched its convertible note financing round on December 3, 2018, with the intent to raise at least $40,000,000 in proceeds. Due to strong demand from both existing shareholders and new investors—including high-net-worth individuals, family offices, cannabis private equity funds and institutions—the financing round was ultimately increased to accommodate $90,000,000 of subscriptions. In completing this financing with strong support from both Beacon Securities, Ltd. and Stoic Advisory, Inc., in its capacity as a strategic advisor to management, Grassroots expanded the geographic dispersion of its investors considerably, with investors domiciled in the U.S., Canada, Europe, Israel and China participating.

By successfully completing this round of funding, Grassroots has solidified its already strong financial position, which includes $165,000,000 of total equity and equity-linked securities raised to date.

"We believe this capital raise now makes Grassroots the largest privately held cannabis company in the U.S.," said Mitch Kahn, CEO and Co-Founder. "Our growth is a testament to our team's collective strategic vision and execution of building an integrated business model that enhances the communities which we serve."

The planned use of the proceeds from the convertible note raise will support the build-out of Grassroots existing 11 state platform, as well as M&A and growth initiatives, including:

• Expansion of the Company's cultivation facilities in Illinois, Maryland and Pennsylvania in tandem with strong growth the company is experiencing in these markets.
• Build-out of new dispensary licenses won by the Company in December and January.
• Funding associated with Grassroots recent strategic partnership with Phyto Science Management Group in Vermont to expand its cultivation and lab capacity, as well as expansion in its CBD derived from hemp business.
• Additional M&A opportunities targeting both new markets and expansion in existing markets.

"This is a very exciting time for Grassroots given that we have expanded our footprint in the last three months from seven states to now encompass 11 states and growing," said Brian Schinderle, Executive Vice President of Finance. "We would like to thank the strong support we saw from both existing and new investors and look forward to continuing to earn their allegiance by both executing on our existing plans and looking to prudently continue to expand our platform."

Grassroots is a cannabis company born in Illinois and committed to growing from the ground up, working locally—state by state—to create jobs and opportunity while serving, advancing and respecting the cannabis movement. Grassroots began 2014 with two employees and currently has more than 400 employees. Recently Grassroots has brought on Lisa Hurwitz, Chief Marketing and Innovation Officer, to further Grassroots portfolio of products and Brian Schinderle, Executive Vice President of Finance, to focus on strategy, M&A and capital markets activities. The company will continue to build its human infrastructure in key areas to support its rapid expansion.

About Grassroots Cannabis
GR Companies Inc. (dba Grassroots Cannabis) is a cannabis company dedicated to serving, advancing and respecting the cannabis movement. Through its unique, vertically integrated business model, Grassroots grows, processes and sells trusted cannabis products that enhance life's moments for people from all backgrounds. Its retail brand, Herbology, offers a unique, wellness and education-focused dispensary experience.

Grassroots Cannabis has built its portfolio at an unprecedented pace, with facilities in highly competitive markets, including Illinois, Nevada, Pennsylvania, Michigan, Maryland, Oklahoma, Ohio, Vermont, North Dakota, Arkansas and Connecticut. The company is pursuing acquisitions in additional markets. The executive management team is composed of a group of highly skilled business leaders united by a common belief: Cannabis inspires us to live deeply. For more information, visit grassrootscannabis.com.

SOURCE Grassroots Cannabis

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