Bhang Inc. (CSE: BHNG) (OTC: BHNGF) said Monday that it has obtained a commitment from its long-term investor Cannabis Growth Opportunity Corporation (CSE: CGOC) to invest up to CA$1.5 million ($1.13 million) in a private placement offering of units.
Each unit consists of one subordinate voting share in the capital of the company and one share purchase warrant exercisable into one share, according to the press release.
Bhang can quicken the expiry of the warrants to 30 days upon notifying the holder if the shares have a closing price of CA$0.25 per share or higher for 10 consecutive trading days on the Canadian Securities Exchange.
The company said it plans to utilize the proceeds to support its direct-to-consumer growth in California, its expansion across three states and the launch of its new beverage line Red Ace Organics.
Bhang said it has signed subscription agreements with Cannabis Growth Opportunity Corporation to swap each other’s shares worth around CA$2 million.
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“The CGOC investment is a vote of confidence for Bhang’s business plan, positioning the company for sustainable, long-term growth,” Jamie Pearson, Bhang’s president and CEO, said in a statement. “We look forward to providing updates throughout 2020 and putting this capital infusion to work to achieve significant milestones.”
Sean Conacher, CGOC’s CEO, said the firm has been watching Bhang closely.
„Their plan is solid and we look forward to helping use both our capital and our portfolio resources to help Bhang continue to build a great business.”
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