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Tuesday, April 20, 2021

Stock Spotlight is CGrowth Capital Inc (OTCMKTS:CGRA)

CGrowth Capital Inc (OTCMKTS:CGRA) is making a huge move up out of sub penny land on big volume. This is an exciting story developing in sub penny land that has quickly established itself as a volume leader on the bb’s attracting a loyal shareholder base who is bidding this one up.

The move comes after CGRA announced preliminary results and net valuations on its magnesium dolomite reserve. Taking into account the physical characteristics of the site, water tables, and anticipated mining expenses, the immediate probable mineral reserve has been set at 63% of the initial survey reserve of 505m cubic yards – which calculates out at 420m tons of material – significantly exceeding initial expectations. The estimated economic benefit from the site, after accounting for royalty, reclamation, and loss, has been estimated at a net value of approximately $2.7 billion.

CGRA was trading for as low as $0.0009 in recent months but that all changed in April when the Company announced the execution of a LOI with Wildfire Cannabis Company, LLC to lease a portion of their properties in Chewelah, Washington to grow pot.

CGrowth Capital Inc (OTCMKTS:CGRA) has traditionally billed itself as a holding company for businesses and assets focused on all aspects of mining, minerals, exploration, and commercial real estate.

The Company owns approximately 47 net acres of industrial land property as well as over 1000 acres of mineral rights & leases located in Stevens County, Washington. Recently CGRA has begun to strategically leverage assets for maximum value within the legally developing cannabis industry currently underway in Washington State.

On April 23 CGRA announced the execution of a Letter of Intent (LOI) with Wildfire Cannabis Company, LLC to lease a portion of our properties in Chewelah, Washington. Wildfire Cannabis Company, LLC holds a Tier 3 Producer / Processor License in Washington State.

As a licensed Tier 3 marijuana producer and licensed processor, Wildfire Cannabis Company is currently qualified to manage between 10,000 square feet to 30,000 square feet of marijuana plant production, as well as additional processing within Washington State (the largest available license). A marijuana producer license allows the licensee to produce, harvest, trim, dry, cure, and package marijuana into lots for sale at wholesale to marijuana processor licensees and to other marijuana producer licensees.

CEO Bill Wright said at the time “We view corporations like Wildfire Cannabis Company as some of the highest value tenants currently available in the state. By restructuring the leases on our properties, and extending them to legally operating cannabis companies, we believe we can maximize lease rates, profits, and in turn shareholder value. As a newly budding industry, the Company’s vision within the cannabis market space is to position our current and future real estate holdings in such a way as to take full advantage of highest and best use of our assets within this industry, and to provide for leadership in this emerging market. The Company views this as an incredible opportunity going forward, and an exciting first step toward potentially repurposing other available assets within the Company.”

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Also in April CGRA said it had received an initial thumbs up on the Company owned site location and indicated that “(they) may proceed with (the) location.” Additionally, the Lessee has scheduled its interview with the LCB to further review the site and license on May 1, 2015. The initial information from the LCB is a positive response for the Company, knowing that the site can support the current group and additional operations. Per Washington statutes, a property can host up to three Tier 3 marijuana operations.

On May 15 CGRA shared details of the Lease Agreement with Wildfire Cannabis Company. The five year, with five year renewal, Lease Agreement calls for a turn-key operational facility provided by the Company for the production and processing of cannabis by the Tenant. The Lease Agreement anticipates gross payments in excess of $2,000,000 annually, to include base rent, tenant improvements, common area maintenance charges, ancillary rentable areas, and administration fees. The Lease Agreement provides for the Tenant to increase its base rentable space by up to 33% as future business growth dictates, in turn increasing the realized rent and revenue to the Company.

CGRA also executed an Option to Purchase Agreement with Wildfire Cannabis Company, LLC. that gives them the right to purchase WFCC for three times its net annual revenue – to be paid by half in cash and half in restricted stock of the Company – for the term of the Lease Agreement.

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Currently trading at a $2.7 million market valuation CGRA has minimal cash or revenues and rising short term debt. But this is an exciting story developing in sub penny land; the Company has a Lease Agreement with Wildfire Cannabis Company, a licensed Tier 3 marijuana producer. Also CGRA has been highly successful in attracting a loyal shareholder base who is bidding this one up. We will be updating on CGRA when more details emerge so make sure you are subscribed to Microcapdaily so you know what’s going on with CGRA.

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Disclosure: we hold no position in CGRA either long or short and we have not been compensated for this article.

Ali Raza
A journalist, with experience in web journalism and marketing. Ali holds a master degree in finance and enjoys writing about cryptocurrencies and fintech. Ali’s work has been published on a number of cryptocurrency publications.

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