Gage Growth Corp. to Commence Trading on the Canadian Securities Exchange on April 6th, 2021

Gage Growth Corp. (“Gage” or the “Company”), a leading high-quality craft cannabis brand and operator in Michigan, is pleased to provide the following corporate update:

Gage Growth Corp. to Commence Trading on the Canadian Securities Exchange

Gage is pleased to announce that the Company’s subordinate voting shares (the “Shares”) will commence trading on the Canadian Securities Exchange under the symbol “GAGE” on Tuesday, April 6th, 2021 (the “Listing Date”).

“We are humbled by all the support we have received from our shareholders, customers, strategic partners, and those that have cheered us on from the sidelines in anticipation of our public listing,” said Fabian Monaco, CEO of Gage. “As a publicly traded entity, this milestone will increase our visibility, allow us to attract new investors, increase our brand awareness, and open doors to exciting new business opportunities.”

As part of the Company’s disclosure obligations as a reporting issuer, ongoing financial and disclosure documents can be found on SEDAR at www.sedar.com under the Company’s profile.

Operational Update

Gage is pleased to provide the following operational update:

1.  Michigan Market

  • The Michigan market is one of the fastest growing cannabis markets and has a robust history of being a strong market due to its medical program which has been online for over a decade. In December 2019, the first month of legal adult-use sales were $7M vs. $67.4M more recently (864% increase over 14 months). In 2020, the MI market posted almost $1B in total sales (250% increase YoY) and coming into 2021, the MI market posted $108M in January 2021 which is $1.3B annualized.
  • Given the continued growth trajectory, we believe Michigan can be a top five cannabis market in the US in 2021.

2.  Exponential Cultivation Ramp

  • One of the Company’s main constraints to growth historically has been its cultivation capacity as our in-house grown products often sell out within a week, sometimes within 48-72 hours of the product launch. In response, Gage is expanding its own facilities while arranging with other growers to supply Gage/Cookies strains on a contract basis (50%+ gross margins is the arrangement).
  • Gage expects its cultivation capacity to increase substantially, from 400lbs in November 2020 to 1,250lbs in March 2021 to 3,000lbs in June 2021 to 5,000lbs/month by year end. These numbers are de-risked, as they are spread across 7 different cultivation facilities currently in production, moving to 9 facilities at the end of Q2 2021, and 13 cultivation facilities by year end.

3.  Cookies Exclusive

  • Gage is the exclusive partner for Cookies in Michigan. This means Gage has the exclusive rights to cultivate, process, and retail all Cookies branded products in addition to operating Cookies branded dispensaries in Michigan.
  • Gage currently operates two Cookies-branded provisioning centers (dispensaries). The Detroit (8 Mile) Cookies location and the Cookies dispensary in Kalamazoo, as the state’s first Cookies adult-use location and first in the Midwest, with plans to open two more adult-use Cookies stores in Q2/Q3 2021.

4.  Quick Retail Expansion

  • Gage currently operates 7 dispensaries with a plan to open an average of one store per month this year. With 12 licenses in the portfolio, in addition to acquisition opportunities in the pipeline, Gage aims to open 20 dispensaries by year end.

5.  Industry Leading Retail Metrics

  • Gage boasts some of the highest dispensary metrics in the industry. The company’s average basket size in 2020 was $164 compared to the estimated state average basket size of $85. Average basket size calculations are based on dividing the total retail sales by the total number of transactions.
  • Additionally, Gage is targeting $1M average in sales per month for each dispensary it operates. Currently, Gage’s recent average monthly sales per dispensary is in excess of $1M.

6.  Completion of Oversubscribed Reg A+ Financing

  • This past January, Gage announced the closing of its Regulation A, Tier 2, equity financing for gross proceeds of US$50 million.
  • The oversubscribed offering included demand from both institutional and retail investors, and significantly expanded the Company’s ownership base through the addition of over 1,000 new shareholders.
  • As part of this offering, funds controlled by Jason Wild and JW Asset Management invested more than US$40 million, comprising 80%+ of the financing.

Lock-up Agreements

In conjunction with the listing of the Shares, the Company’s founders, insiders, directors, and officers (the “Locked-up Holders”) have entered into a voluntary lock-up agreement (each a “Lock-up Agreement”), effective March 30, 2021. Parties that have entered into this Lock-up Agreement represent approximately 67% and 72% of the voting rights of the Company on a basic and fully diluted basis, respectively.

The voluntary Lock-up Agreements stipulate that the Locked-up Holders will not offer to sell, contract to sell or otherwise dispose of any of their currently owned securities of the Company (the “Locked-up Securities”), or enter into any transaction to such effect, directly or indirectly, in addition to other restrictions. Subject to the provisions of the Lock-up Agreement, the Locked-up Securities will be released and not be subject to the Lock-Up Agreements as follows: (a) 10% of the Locked-up Securities shall be released on the Listing Date; (b) 15% of the Locked-up Securities shall be released on the date that is three (3) months following the Listing Date; and (c) 75% of the Locked-up Securities shall be released on the date that is six (6) months following the Listing Date.

About Gage

Gage Growth Corp. is innovating and curating the highest quality cannabis experiences possible for cannabis consumers in the state of Michigan and bringing internationally renowned brands to market. Through years of progressive industry experience, the firm’s founding partners have successfully built and grown operations with federal and state licenses, including cultivation, processing and retail locations. Gage’s portfolio includes city and state approvals for 19 “Class C” cultivation licenses, three processing licenses and 12 provisioning centers (dispensaries).

For more information about Gage Growth Corp., visit www.gagecannabis.com

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