KushCo Holdings, Inc. (OTCQX:KSHB) (”KushCo”), a premier provider of ancillary products and services for the legal cannabis and CBD industries, has retired its senior unsecured term debt, represented by a Senior Note originally issued in April 2019. The Company paid in aggregate $17 million to retire the full principal balance and accrued interest under the Senior Note. Repayment of the Senior Note, which was used to support the Company’s growth in sales, realigns KushCo’s capital structure and significantly reduces the amount of total debt outstanding.
The Company recently closed a $40 million registered direct offering, which was oversubscribed with commitments in excess of $125 million.
“Following nearly a year of comprehensive restructuring and right-sizing-which saw us return to growth, reduce our cost structure by more than 50%, and achieve positive adjusted EBITDA for two consecutive quarters-more high-quality institutional investors are beginning to appreciate KushCo’s investment thesis, as evidenced by our recent oversubscribed offering,” said Nick Kovacevich, KushCo’s Co-founder, Chairman, and Chief Executive Officer. “With this capital, we have not only completely retired our term debt-which was set to mature in April 2021, and which we believe has been a material ‘overhang’ on our stock-but have also paid down the balance of our existing line of credit, significantly reducing our total debt outstanding. We also have a healthy amount of capital left from the raise to support our continued growth and fund the business’ sales and financial goals for at least the remainder of fiscal 2021. Overall, we believe this is an incredible achievement for the Company, and the latest sign that we are becoming more in control of our own destiny and moving closer toward establishing ourselves as the preeminent provider of all ancillary solutions to the legal cannabis and CBD industries.”
