The cannabis and hemp company has found a source of funds to feed expansion projects
Agrify, the highly innovative and vertically integrated provider of premium cultivation and extraction solutions for both the hemp and cannabis industries, announced yesterday that it has entered into securities purchase agreements with several accredited investors, including an institutional investor, in a private placement transaction. As a result, the cannabis major is reported to have been able to raise a total of $27 million.
Based on the agreements, Agrify is tasked with issuing and selling 4,020,994 shares of common stock or, in lieu thereof, pre-funded warrants, and the attached warrants exercisable six months after closing to purchase up to 3,015,745 shares of common stock for a period of five years at an exercise price of $7.48 per share. It has been indicated that $6.80 would be the combined purchase price of the warrants and common shares.
Various board members and management members, such as Raymond Chang, the company’s president and CEO, participated in the offering on the same terms as set forth for investors, except that the combined purchase price was $0.10 more. Agrify expects to raise gross proceeds from the offering of approximately $27.3 million before deducting placement agent fees and estimated offering expenses.
A resale registration statement relating to the common stock and common stock issuable upon exercise of the Pre-Funded Warrants and the Warrants will be filed with the Securities and Exchange Commission (SEC) within the next 30 days. The exclusive placement agent for this offering will be Craig-Hallum Capital Group LLC. It is expected that January 28th will be the date on which the offering will close, subject to the satisfaction of customary closing conditions.
Through the net proceeds of the offering, the company intends to enhance various general corporate purposes, such as product development, acquisitions, capital expenditures, working capital, and various business opportunities.