GARDEN GROVE, Calif., Jan. 22, 2019 (GLOBE NEWSWIRE) — KushCo Holdings, Inc. (OTCQB: KSHB) (“KushCo” or the “Company”), the parent company of innovative cannabis industry leaders such as Kush Supply Co., Kush Energy, The Hybrid Creative, and Koleto Innovations, which provide a range of services and products for the regulated cannabis, CBD and other related industries, today announced it closed a registered direct offering of 6,476,190 shares of common stock and warrants to purchase 3,238,095 shares of common stock with a combined purchase price of $5.25 per share on January 18, 2019. The warrants have an exercise price of $5.75 per share, are immediately exercisable and will expire five years from the date of issuance. The gross proceeds of the offering are approximately $34,000,000 before deducting placement agent fees and other estimated offering expenses. The Company intends to use the net proceeds for general corporate purposes, including, among other things, working capital, product development, acquisitions, capital expenditures, and other business opportunities.
A.G.P./Alliance Global Partners acted as the lead placement agent in connection with the offering.
Compass Point Research & Trading, LLC acted as co-placement agent in connection with the offering. Northland Securities, Inc. acted as a financial advisor in connection with the offering.
We continue to be very pleased with our rapid revenue growth and significant customer expansion, as evidenced by our recently announced long-term supply arrangements-in-principle totaling $75.0 million. We believe this recent capital raise will continue to allow us to appropriately fund our working capital needs and fuel our continued sales trajectory and meet our growing customer demand.
KushCo’s Chief Executive Officer, Nick Kovacevich
The cash proceeds will also support our current investment in our technology platforms leading to improved supply chain efficiencies. As we progress through fiscal 2019, we remain acutely focused on building out a scalable, sustainable business, executing on our cross-selling strategy and being a first-mover in new domestic and international markets.
This offering was made pursuant to an effective shelf registration statement on Form S-3 (File No. 333-221910) previously filed with the U.S. Securities and Exchange Commission (the “SEC”), and an additional registration statement on Form S-3 filed pursuant to Rule 462(b) under the Securities Act, which became effective upon filing on January 16, 2019 (File No. 333-229264). A prospectus supplement describing the terms of the proposed offering has been filed with the SEC and is available on the SEC’s website located at http://www.sec.gov. Electronic copies of the prospectus supplement may be obtained from A.G.P./Alliance Global Partners, 590 Madison Avenue, 36th Floor, New York, NY 10022 or via telephone at 212-624-2006 or email: prospectus@allianceg.com.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
About KushCo Holdings, Inc.
KushCo Holdings, Inc. (OTCQB: KSHB) is the parent company to a strategically integrated group of business units that are transformative leaders across several industries. KushCo’s subsidiaries and brands provide exceptional customer service, product quality, compliance knowledge and a local presence in serving its diverse customer base.
KushCo’s brands include Kush Supply Co., a dynamic sales platform that is the nation’s largest and most respected distributor of packaging, supplies, and accessories to the cannabis and CBD industry, Kush Energy, which provides ultra-pure hydrocarbon gases and solvents, Hybrid Creative, a premier creative design agency for clients across several industries, and Koleto Innovations, the research and development arm driving intellectual property development and acquisitions.
Founded in 2010, KushCo has now sold more than 1 billion units and regularly sells to more than 5,000 legally operated medical and adult-use dispensaries, growers, and producers across North America, South America, and Europe. KushCo’s subsidiaries maintain facilities in the five largest U.S. cannabis markets as well as having a local sales presence in every major U.S. cannabis market.
KushCo strives to be the industry leader for responsible and compliant products and services in the legal cannabis and CBD industry. The Company has been featured in media nationwide, including CNBC, Los Angeles Times, TheStreet.com, Entrepreneur, and business magazine Inc. While KushCo provides products and solutions to customers in the cannabis and CBD industries, it has no direct involvement with the cannabis plant or any products that contain THC or CBD.
For more information, visit www.kushco.com or call (888)-920-5874.
