Urban‑gro, Inc. (UGRO) completed a private placement of a secured, convertible promissory note with a nominal value of $2.775 million, of which $2.525 million was received as gross proceeds after a $250,000 original‑issue discount. The note carries a 12% annual interest rate, matures 12 months after issuance, and is convertible at the lesser of $36.00 per share or 80% of the 10‑day average lowest traded price. The placement, executed through Thunder Rock Capital LLC, also includes warrants that give holders the right to purchase additional shares at a specified price. The note is junior to a prior $2 million loan from Grow Hill, LLC, and is secured by UGRO’s assets.
UGRO has been operating under significant financial strain, reporting a $9.5 million revenue and a $4.0 million net loss for Q1 2025, a decline from $15.4 million and a $2.6 million loss a year earlier. The company’s balance sheet shows a $120.6 million accumulated deficit and a $40.9 million stockholders’ deficit, with negative working capital and liabilities exceeding assets. In March 2026, UGRO regained full compliance with Nasdaq listing standards after a reverse stock split and timely filing of delayed reports, placing the company under a one‑year Nasdaq discretionary panel monitor.
The financing supports UGRO’s strategic transition from a controlled‑environment agriculture business to a speculative cricket‑media platform. Management has positioned the company to expand its sports, media, and experiential offerings, with a particular focus on the Lanka Premier League (LPL) and broader cricket markets. The pivot aims to leverage the growing sponsorship and media valuation of the LPL, which reached approximately $176.5 million in Season 5, and to pursue potential acquisitions, league operations, and licensing opportunities that could generate new revenue streams.
Net proceeds from the note will be used to fund the expansion of UGRO’s sports and media platforms, support ongoing league operations, and finance potential acquisitions and licensing deals. The liquidity injection is intended to sustain day‑to‑day operations while the company continues to develop its cricket‑centric business model, thereby reducing reliance on its legacy agriculture operations and addressing immediate cash‑flow needs.
The transaction represents a critical lifeline for a company that has faced severe financial distress and a negative equity position. While the convertible note provides necessary working capital and supports the company’s speculative pivot, the success of the new business model remains uncertain. Investors will monitor how effectively UGRO can translate its focus on the LPL and related media opportunities into profitable revenue streams, given the high risk associated with entering a competitive sports‑media market and the company’s ongoing liquidity challenges.
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