GrowBLOX Sciences, Inc. CEO Updates Shareholders on Key Developments

LAS VEGAS, July 21, 2014 /PRNewswire/ -- 

To Our Shareholders,

Introduction: Much has been happening at GrowBLOX Sciences, Inc. (OTCQB: GBLX) over the past three months, and I wanted to take a moment to update you on our progress.  On March 12, 2014, we entered into an asset acquisition agreement that took us to the forefront of the emerging legal cannabis industry.  The March agreement gave us intellectual property, equipment, business plans, and other assets that we think will allow us to revolutionize our industry by turning cannabis cultivation from an art into a science.

From Art to Science: Current cannabis cultivation is typically performed without standard methods, scientific scrutiny, or rigorous testing – you might call it a dark art.  The invention of our GrowBLOX^TM growing chamber seeks to change all this by controlling, standardizing, monitoring, and testing every aspect of cannabis cultivation.  We've invested millions of dollars and hired some of the best engineers and botanists to develop this chamber.  The chamber is a sealed, sterile environment where computers measure and control everything from temperature, to lighting, to water, to oxygen, to CO₂.  The result is something like a cannabis factory, where, because you control all the variables, you get consistent, pure, toxin-free strains of cannabis in predictable volumes.  You can see a video demo of the chamber on our website, gbsciences.com.  To our knowledge, no other company can claim to cultivate high volumes of cannabis with the predictable, standardized outputs that we will achieve.

The GrowBLOX Solution: Not only have we developed our proprietary GrowBLOX^TM growing chamber, but also a complete solution to the challenges facing the medical marijuana industry. The full GrowBLOX Solution contains: 1) the GrowBLOX^TM tissue propagation chamber for preparing clonally-derived plants; 2) the original GrowBLOX^TM growing chamber; 3) the GrowBLOX^TM curing chamber to cure and dry each Cannabis harvest; 4) the GrowBLOX^TM extraction chamber to create our proprietary oils; 5) GrowBLOX^TM branded, childproof packaging for each of the GrowBLOX strains and cannabis-oil based products; and 6) GrowBLOX research supporting the medical efficacy of our products. We don't sell the GrowBLOX Solution to the public or even to the medical marijuana industry. Instead, we will enter strategic partnerships in each state as we rapidly expand.

Turning It into a Business: On the strength of our GrowBLOX Solution, our subsidiaries were awarded two permits in Clark County, Nevada: one to grow cannabis in our industrial grow facility and a second to open a retail dispensary in the Fort Apache area.  Securing these permits in a highly competitive process was a huge victory for our company and in our view, the hardest part of the entire process.  We still need to receive State approval before we can open these two facilities.  We cannot guarantee the result or the timing of the State's process, but it is our current expectation that we will be fully licensed for both the grow facility and the dispensary in the fourth quarter of 2014.  Allowing some time for construction, we should be on pace to be generating revenues from both the cultivation and sale of legal medical cannabis in the second half of 2015. 

Just the Beginning: As exciting as the opening of our Nevada sites will be, it is just the beginning for our company.  Our industry is an emerging one, and we view the current environment as a land grab.  Accordingly, we are in the process of attempting to secure cultivation and dispensary licenses throughout the country through our strategic partnerships.  Each state has its own rules and requires working with the right local partners.  We are currently in various stages of permit applications in several states, including Florida, New York, Illinois, as well as the territory of Puerto Rico which is taking an aggressive approach to launch a cannabis industry.  We will continue to develop other territories as aggressively as we can.  It is impossible to predict the timing of the award of the permits, but we are optimistic that we will have others to announce in coming quarters. 

The permitting process is always competitive, rigorous, and thoughtful as states and cities seek to make the right choices for their communities.  Our secret sauce is our GrowBLOX^TM Solution which alleviates overseers' fears about the lack of sterility, the use of pesticides and toxic chemicals, and the inconsistent levels of active compounds in plants when grown using traditional methods.

The Cash Solution: We also have a second ingredient in our secret sauce: a banking solution. Today, the medical cannabis industry is challenged by something very mundane – cash management.  Traditional banks are almost never willing to accept a dispensary as a client.  The high volumes of cash transactions in a dispensary also pose a security risk.  Our relationship with First Security Bank of Nevada gives us a partner to manage the currency and banking flow of our retail operations.  We were able to sign a letter of intent with First Security because of our pioneering cashless dispensary solution.  Through the use of ticket kiosks and enterprise software, no employee of ours will ever touch cash in a dispensary.  It will go straight from the customer to the kiosk to the bank, with the cash secured and auditable every step of the way.  This solution addresses a host of the industry's concerns, from money laundering to theft.  

We Are Really a Biotech Company:  The roll out of our nationwide dispensaries and grow facilities will position us to be the world's premier supplier of standardized, medical grade cannabis.  Research at leading universities has shown that various compounds in the cannabis plant may be beneficial in treating a wide range of medical conditions, everything from glaucoma to epilepsy to cancer.  GrowBLOX is embracing the science, and actively supporting the research of, cannabinoid-based therapeutics as effective medicine for multiple health conditions. 

In the second half of the year, we expect to begin establishing clinical trials for the treatment of serious medical conditions using medicinal marijuana-derived therapies, each addressing a large unmet clinical need.  For each successive condition, we will be filing for patents on: 1) distinct strands of cannabis that we grow in our proprietary manner, 2) process patents to protect our proprietary extraction methodologies, and 3) specific pharmaceutical formulations.  Our vision is to be selling our own medical-grade marijuana; as well as plant-derived neutraceutical and biopharmaceutical products over time. In addition, we are poised to become a supplier of standardized, medical grade cannabis-derived compounds to the pharmaceutical industry.  That's why, as much as we view ourselves as a leader in the cannabis industry, we also think of ourselves as a real contender in the emerging cannabinoid-based biopharmaceutical industry.

Financing: How will we fund all our growth?  Yes we have large ambitions, but are taking a methodical and calculated approach to growth.  Earlier this month, we announced the closing of a $5 million private placement with institutional and accredited investors.  The financing included warrants which, when fully exercised, amount to a $30 million financing.  By next year, we expect to see significant monthly revenues from our grow facility and dispensary in Nevada.  As we add new dispensaries, our cashflow will continue to grow.  I am the largest shareholder of this company, so I am very sensitive to dilution and I strive to keep expenses low.

Summary: As you can see, so much has happened in the past three months.  We've gotten two key permits, solved the industry's banking problem, developed a robust pipeline of new dispensary and grow facilities, raised significant financing, gotten to the point where we are months away from revenue, and positioned ourselves to be the leading supplier of standardized, pharmaceutical-grade cannabis.  Along with my colleagues at GrowBLOX, I feel that we are at the forefront of a revolution and I couldn't be more excited about the future. 

Sincerely,

Craig Ellins
Chairman and CEO
GrowBLOX Sciences, Inc.

About GrowBLOX Sciences, Inc.

GrowBLOX Sciences, Inc., is a research and biotechnical company that has developed proprietary indoor growing chambers specifically designed for medical cannabis cultivation.  The GrowBLOX^TM chamber allows for completely controlled growing conditions, ensuring the manufacture of a consistent, toxin-free, natural and medicinal-grade product.  The Company believes that the advantages of a controlled environment over traditional outdoor or greenhouse growing, will empower the public, physicians and pharmaceutical industries to embrace cannabis as an effective treatment for a myriad of serious medical conditions.  http://www.gbsciences.com

Forward-Looking Statements

Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements are inherently unreliable and actual results may differ materially.  Examples of forward-looking statements in this news release include statements regarding the payment of dividends, marketing and distribution plans, development activities and anticipated operating results.  Factors which could cause actual results to differ materially from these forward-looking statements include such factors as the Company's ability to accomplish its business initiatives, significant fluctuations in marketing expenses and ability to achieve and expand significant levels of revenues, or recognize net income, from the sale of its products and services, as well as the introduction of competing products, or management's ability to attract and maintain qualified personnel necessary for the development and commercialization of its planned products, and other information that may be detailed from time to time in the Company's filings with the United States Securities and Exchange Commission.  The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact:
Jonathan Barkman
Riverview Capital Enterprises
+1-866-845-0105

SOURCE GrowBLOX Sciences, Inc.