CHICAGO--(BUSINESS WIRE)--PRESS RELEASE--Cresco Labs, one of the largest vertically integrated multistate cannabis operators in the United States, has announced that the company served 3,145 people on New Year’s Day at its five Sunnyside* Dispensaries located in Lakeview, Elmwood Park, Champaign, Buffalo Grove and Rockford, Illinois. Sunnyside* also sold 9,258 cannabis products, including Cresco’s house of brands and items from other Illinois suppliers, with an average ticket price totaling $135.
Customers began to form lines outside Sunnyside* locations as early as 8 p.m. on New Year’s Eve, and lines wrapped around the buildings throughout the day as recreational customers showed their excitement to be part of this historic day. The dispensaries opened at 6 a.m. to immediately start serving recreational customers, with the first sale in the state of Illinois taking place shortly thereafter at Sunnyside* Lakeview. Jacqueline Ryan from Forest Park was the first customer to purchase adult-use cannabis, followed by siblings Elise and Aaron Swopes, two participants in Cresco’s Chicago incubator program, which is part of the company’s SEED (Social Equity and Educational Development) initiative, and Illinois Lt. Gov. Juliana Stratton, who played a critical role in shaping the state’s cannabis legislation.
“We’re ecstatic for our Sunnyside* dispensaries to begin serving recreational customers on such a historic day that launches a new era of cannabis and the development of an industry that will bring greater justice, social equity and business ownership opportunities throughout the state,” said Charlie Bachtell, Cresco Labs CEO and co-founder. “With 13 million residents and 100 million annual tourists, Illinois is predicted to be one of the largest recreational cannabis markets in the United States. Cresco is uniquely positioned in the supply-constrained state, with permission for the largest cultivation footprint at 630,000 square feet and ten retail dispensaries, including three in high traffic areas in the city of Chicago.”
Joe Caltabiano, Cresco Labs President and Co-Founder, added, “We’re thrilled to be part of this historic day and to witness firsthand so much excitement from people on the first day of legal cannabis sales. Our dispensaries served thousands of customers on day one by educating new cannabis consumers, making product recommendations and making sure they had a seamless shopping experience. With five newly re-concepted Sunnyside* locations and an additional five dispensaries opening soon in high profile locations such as one next to Wrigley Field and two in Chicago’s downtown Central District, we expect to serve thousands more customers in response to strong demand. Our Sunnyside* concept is designed to move traffic efficiently, so despite the fact that long lines will likely continue in the first few days of adult-use legalization, we are positioned to ensure that each of our customers gets only the best possible service and the products they are looking for. Cresco is already the leader in Illinois, and we expect to be able to maintain this leadership position as the recreational cannabis market grows, contributing solidly to our overall revenue and our profitability.”
MJardin Enters into Definitive Agreement for the Sale of Its Cheyenne Cultivation Facility
The company will use the proceeds of the transaction to reduce its debt obligations and for working capital requirements for its 2020 plan.
TORONTO and DENVER, Jan. 02, 2020 (GLOBE NEWSWIRE) -- PRESS RELEASE -- MJardin Group, Inc., a premium cannabis producer, has announced that it has entered into a definitive agreement with Harvest DCP of Nevada, Cheyenne Holdings LLC, a division of Harvest Health and Recreation Inc., to sell all of its interest in GreenMart of Nevada LLC, which possesses a Nevada Marijuana Cultivation Facility License and operates the cultivation facility at 5421 E. Cheyenne, Nevada, for a total consideration of US$35 million in cash, comprised of US$30 million on Dec. 31, 2019, plus US$5 million upon license transfer, subject to regulatory approvals.
The company will use the proceeds of the transaction to reduce its debt obligations and for working capital requirements for its 2020 plan.
“We are pleased with the return on our investment at Cheyenne. The proceeds from the transaction significantly reduce our debt while strengthening our financial position towards funding our working capital requirements in 2020,” said Pat Witcher, president and CEO of MJardin. “We are starting the new year on stronger footing with a clear view on accomplishing our profitability targets based on all of our key assets coming online.”
MJardin continues to focus on growing operations in Nevada through Cannabella, an extraction, distribution and consumer product company acquired in the spring of 2019 (license transfer pending). Cannabella’s products are already in approximately 50 of the 68 retail dispensaries in Nevada, and the company anticipates that it will be able to expand to many of the new dispensaries being opened following the recent grant of approximately 50 additional licenses.
The transaction has been unanimously approved by the Board of Directors of the company, following the unanimous recommendation of a special committee of independent directors of the company. Canaccord Genuity Corp. acted as exclusive financial advisor to MJardin. Canaccord Genuity and Cormark Securities have provided fairness opinions to the special committee of the Board of Directors of the company stating that, as of the date of such opinions, and based upon and subject to the assumptions, limitations and qualifications stated in such opinions, the consideration being received under the transaction is fair, from a financial point of view, to the Company. Foley & Lardner LLP acted as U.S. counsel and Norton Rose Fulbright Canada LLP acted as Canadian counsel to MJardin on the transaction.
Curaleaf Holdings, Inc. Announces New $275 Million Senior Secured Term Loan Facility
WAKEFIELD, Mass., Dec. 20, 2019 /PRNewswire/ -- PRESS RELEASE -- Curaleaf Holdings, Inc., a vertically integrated cannabis operator in the United States, has announced that the company has received commitments from a syndicate of lenders for a US$275 million Senior Secured Term Loan Facility bearing interest at a rate of 13.0% per annum, payable quarterly in arrears, with a maturity 48 months from closing.
Curaleaf has received commitments for the facility from existing lenders as well as other United States based institutional investors. This transaction constitutes a broadly syndicated institutional deal led by sophisticated and long-term investors that have confidence in the cannabis industry and the Curaleaf team in particular. The proceeds will be used to refinance existing debt, satisfy transaction fees and expenses from previously announced acquisitions, fund capital expenditures and for general corporate purposes. The sole placement agent for the facility is Seaport Global Securities LLC.
"This transaction is a historic milestone for Curaleaf. Our track record of continuously improving results has attracted a strong group of institutional investors who share our belief that we have established a leading credit profile in the cannabis industry," said Joseph Lusardi, Chief Executive Officer of Curaleaf. "Importantly, we have raised debt capital at attractive terms without the need to dilute our shareholders. We believe this additional capital fortifies Curaleaf's balance sheet to take advantage of the significant market opportunities that exist in this space."
Neil Davidson, Chief Financial Officer of Curaleaf, continued, "As our business continues to scale and generate positive free cash flow, this additional capital puts us in a position of strength and provides us with ample liquidity to execute on our strategy. Further, we believe our pending acquisitions, most notably Select and Grassroots will benefit from our expanded balance sheet, both of which are expected to close early next year."
The facility is subject to completion of customary closing conditions, with expected completion of conditions precedent and drawdown on or about Jan. 10, 2020.
University Research and the Cannabis Industry: Q&A with Robert Eddy
As prohibition crumbles, more research becomes available to cannabis cultivators. How can growers best implement plant science into their operations?
Cannabis’s Schedule I status has largely forced cultivators to make decisions based on industry consensus, but as prohibition crumbles, research is beginning to trickle out of major universities around the world. As more information becomes available, growers can start to use the same meticulous methodology and peer-reviewed process that has been used for flower, vegetable and agronomic crops to have a better understanding of the plant physiology responsible for higher yields and the development of cannabinoid and terpenoid profiles.
Here, Robert Eddy, director of ag projects at Core Cannabis and the former plant growth facilities manager at Purdue University, shares how a lack of scientific knowledge has impacted the cannabis industry, as well as how growers can begin to implement the science that is becoming available.
Cannabis Business Times: How has a lack of research and scientific knowledge affected the cannabis industry?
Robert Eddy: From my perspective, they’ve done an excellent job teaching themselves and learning, sharing information. I think where the limitation is, there hasn’t been a lot of research coming out of the universities. The other half of it is, when universities do research that can apply to commercial production of agriculture and horticulture products, they use the cooperative extension service to disseminate that information. That community, until recently, hasn’t been serving the cannabis growers because universities aren’t quite ready to do that yet. But the dam has broken. Thanks to Cannabis Business Times in particular, that dam has broken, and you guys are publishing articles by extension specialists like Ray Cloyd, Brian Whipker [and] Brian Jackson. If they’re disseminating information, the cannabis growers are finding that valuable, and the universities realize, “Yes, we are serving a good industry here, and we need to sustain this.”
CBT: What kind of research on plant science is starting to come out of major universities?
RE: Of course, there’s been some great stuff beginning to roll out on cannabis, but what I find intriguing is to look at the other industries that plant science is serving and realizing, “Oh, this would apply to cannabis beautifully.” For example, the vertical farming industry, where they have stacks of plants, usually in indoor warehouses with LED lights—they are trying to improve flavor profiles. The way you do that is to improve the secondary metabolite [and cannabinoid] production in the plants. So, you [can] look at what other industries do to improve flavor of their crops, or maybe they’re using some cool tricks for disease control, and you realize, “Oh, this would apply beautifully to cannabis.”
Some of the stuff that’s beginning to roll out right now is, of course, the lighting research. There’s been great work with using finishing spectrums, using light in the last week of production to improve THC and terpene profiles, using sub-canopy lighting [and] intra-canopy lighting to improve yield and terpene profiles. There’s been a lot of work on far red light being added to the spectrum that’s in these grow fixtures, and that can improve yield of crops through some really nifty new plant physiology discoveries—brand new stuff that’s been very exciting to follow and, sure enough, the cannabis industry has picked up on this really quickly.
There’s been great work in applying stresses to plants to increase the secondary metabolites. Drought stress, for example, but also light stress—those inter-cycle spectrum treatments where you expose plants to a blue light or a green light or some other specific waveband in the last week or two. That’s actually applying stress to that plant, and they’re responding by creating more cannabinoids.
Then, there’s been research—not on cannabis but on other crops—on using heat treatments or light treatments for disease control. Using environmental controls for something like disease control would really be helpful in the cannabis industry where you just don’t have access to fungicides.
Another aspect of science that’s been around a little while, but it really needs to be applied to cannabis, is the four stages of rooting. These are environmental recommendations [on] the four stages of germination if it’s a seedling or the four stages of rooting if it’s a tissue culture. It’s just a matter of dividing up that period of time where the seed or the tissue culture/clone starts the process of initiating roots, until it’s ready to go into the veg stage. You just divide that up into four periods and they’re specifically defined, and you apply different environmental setpoints during those four periods just to optimize the rooting and to get it ready for the vegetative stage, so the plant doesn’t go into some kind of shock when it gets moved in.
And one more [bit of research] is phenotyping, in this case meaning the automated assessment of plant traits. Humans have been phenotyping plants forever. They make a cross between two lines and they examine to see which ones they like and what kinds of traits they have. Now, plant science is bringing machine vision into this, and sometimes automatic conveyance where you have this chamber with sophisticated environmental controls and the plants are on conveyors and they move into imaging booths, like camera booths, and they’re imaged. Sometimes, that imagery is with normal red/green/blue spectrum, but other times, they’ll use fluorescent spectrometry, and they’ll use other wavelengths. They can look at plants and see things that the human eye couldn’t see. They can also make automatic measurements of plants, like the number of flowers, the number of branches [and] the leaf area, and all this can be automated and quantified. It’s a great tool is it’s great for breeding. If you’re breeding, then you can automate the assessment of all these new lines. It’s all being done in a quantifiable way by machines, and you’ve got data to look at, not just human assessment, which is, of course subjective.
CBT: How can cannabis cultivators start to implement this research into their operations, and how will this change the way they run their businesses?
RE: Better and better information is coming out of the universities, so they can pay attention [to] see what’s going on in the plant science community.
Also, as they hire new staff, I think they will begin to look for students who’ve been exposed to these new technologies. They’ll be hiring more students with maybe some ag engineering backgrounds, not just the horticulture.
Also, along those lines, I suspect that community colleges and technical colleges and universities [that are] already beginning to create cannabis programs of study [will] get more technical, so these graduating students who will become the new hires have some background in it.
I think it will depend on the cannabis growers’ current market and methodology. A craft grower might particularly look at some of the ways to change the cannabinoid profile and utilize those, and it probably would build from experience they already know, but this would be a way to quantify it so that it can be done not just subjectively by one or two humans on their team, but could be done in a little bit more automated fashion or in a more controlled way. As they scale up their business or open up different greenhouses or grow rooms in different parts of whatever state they’re in, they can have more uniform methods to achieve those cannabinoid profiles.
CBT: What sort of benefits will cultivators see from a more science-based approach?
RE: I think they’ll see their own knowledge and their own experience validated, and yet it will be validated in a way that can be quantified and shared objectively. So, it’ll validate what they already know, it’ll quantify what they already know, and it’ll also, at the same time, provide scientific explanations for what some of the observations are that still might be mysterious with this plant.
Also, I think they’ll see that they’ll have better control over their environments. They’ll have a better understanding of how to modify their environments for particular goals, [such as] uniformity of your crop, higher yields or maybe a particular cannabinoid profile. You might not be able to get all of those things at once, but I think they could choose and modify the environment.
I think they might find they’re able to reduce the time it takes to reap plants by following those four stages of rooting. Sometimes, [cultivators are] not having good luck in the greenhouse. Maybe the yield isn’t there, or maybe the yield is sometimes there, but it’s not uniform. I think these plant environment principles will help them grow in the greenhouse and better understand how the greenhouse works. They might find that the scalability of the greenhouse combined with these plant empowerment principles might allow them to get the uniformity that they’ve always wanted from those environments.
CBT: What do you hope attendees will bring back to their business from your session at Cannabis Conference 2020?
RE: I hope they’ll bring back an excitement and enthusiasm about what’s out there. I hope they see that there’s a lot of low-hanging fruit out there. There are a lot of things being done in other crops in greenhouses that could apply to cannabis right now. They could get a better crop or a more uniform crop from knowledge that is already known and being practiced in other parts of the agriculture industry.
Then, I’d like them to go home with a bit of an excitement about what’s coming in the future, about some of these great discoveries that have been made with these plant empowerment principles or plant phenotyping to control plant disease.
Editor’s Note: This interview has been edited for style, length and clarity.
Denis Larkin | Adobe Stock
Illinois Governor Pardons More Than 11,000 Cannabis Convictions Ahead of Adult-Use Market Launch
Gov. J.B. Pritzker announced Dec. 31 that he would clear the records of those with low-level cannabis-related convictions.
Illinois Gov. J.B. Pritzker announced Dec. 31, the eve of adult-use cannabis legalization in the state, that he was pardoning more than 11,000 low-level cannabis convictions.
“When Illinois’ first adult-use cannabis shops open their doors tomorrow, we must all remember that the purpose of this legislation is not to immediately make cannabis widely available or to maximize product on the shelves; that’s not the main purpose, that will come with time,” Pritzker said in his announcement. “But instead the defining purpose of legalization is to maximize equity for generations to come.”
The pardon means that convictions involving less than 30 grams of cannabis will be automatically expunged, and the 11,017 Pritzker pardoned Tuesday will receive notification via mail, the Chicago Tribune reported.
State officials estimate that there are hundreds of thousands of people in Illinois who could be eligible for expungement, according to the news outlet. Illinois State Police are searching criminal records to identify eligible cases and submitting them to the Prisoner Review Board, which reviews the cases and sends the names of those eligible for expungement to the governor’s office to be considered for a pardon.
While many of the cases will be automatically expunged in the next couple of years through this process, those with criminal convictions can get a copy of their record and start the process sooner, the Chicago Tribune reported.
Cases involving 30 to 500 grams of cannabis are also eligible for expungement, but the process will not be automatic; individuals must file motions to vacate the convictions, according to the news outlet.
Legislative Map
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