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VANCOUVER, Sept. 24, 2018 /CNW/ - Koios Beverage Corp. (CSE: KBEV)(OTC: KBEVF) (the "Company" or "Koios") is pleased to announce the Company has entered into an agreement (the "Agreement") for a draw-down equity facility of up to $28,000,000. The Agreement provides for equity private placement offerings (each, an "Offering"), to be conducted between the Company and Alumina Partners (Ontario) Ltd. ("Alumina Partners"), a subsidiary of Alumina Partners LLC, a New York based private equity firm that has made significant investments in the cannabis sector, in draw-down amounts of up to $2,000,000.
Pursuant to the terms of the Agreement, Alumina Partners committed to purchasing up to $28,000,000 worth of units of the Company (each, a "Unit"), consisting of one common share (each, a "Share") and one half of one common share purchase warrant (each whole warrant, a "Warrant"), with each Unit being purchased at a discount of between 15 to 20% of the then current market price of the Shares, or such lesser discount as dictated by Section 2.1 of Policy 6 of the Canadian Securities Exchange or as mutually agreed by the parties, with each Offering occurring at the sole option of the Company, throughout the 24 month term of the Agreement. The exercise price of the Warrants will be at a 50 per cent premium over the then current market price of the Shares. Each whole Warrant will entitle the holder to purchase one additional share for a period of 24 months from the closing of the applicable Offering. Closing of each Offering is subject to a number of conditions, including receipt of any necessary corporate and regulatory approvals.
The equity facility has been structured to best suit the Company's rapid growth strategies while maintaining shareholder value. Each draw-down will be drawn upon at the sole discretion of Koios, allowing for the flexibility to access funds only when necessary. This strategy allows Koios to protect shareholder value while growing consumer awareness and meeting production demands for new and existing territories.
"In our minds, Alumina offers the ideal type of financing for a younger company like ours that faces rapid expansion, but also does not want to dilute their shareholders by taking on too much equity investment at lower valuations," explained Koios CEO Chris Miller. This Agreement will allow us to comfortably fuel our expansion and help the Company execute its transition into profitable growth."
"The most rapidly expanding and evolving markets – along with the highest gross margins – in the regulated cannabis space are presently in cannabinoid beverages," said Adi Nahmani, Managing Member of Alumina Partners LLC. "We are pleased to stand behind Koios as they work to extend their commanding lead in this market and move to aggressively add new markets to their growing portfolio."
All securities issued in connection with an Offering will be subject to a statutory hold period of four months and one day from the date of issuance in accordance with applicable securities legislation.
None of the securities issued in an Offering will be registered under the United States Securities Act of 1933, as amended (the "1933 Act"), and none of them may be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the 1933 Act. This news release shall not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of the securities in any state where such offer, solicitation, or sale would be unlawful.
On behalf of the Board of Directors of the Company.
KOIOS BEVERAGE CORP.
Chris Miller, CEO and Director
About Koios Beverage Corp.
The Company is an emerging functional beverage company which has an available distribution network of more than 2,000 retail locations across the United States in which to sell its products. Koios has relationships with some of the largest and most reputable distributors in the United States, including Europa Sports, Muscle Foods USA, Western Functional Beverages, KeHE and Wishing-U-Well. Koios is also the sole owner of Cannavated Beverage Corp., a subsidiary that develops beverage products and formulas for the growing cannabis market. Through its agreement with Keef Brands, the largest producer of cannabis beverages in North America, Cannavated enjoys distribution throughout the state of Colorado and is preparing for distribution in additional U.S. states where cannabis use is legal.
This news release contains forward-looking statements. All statements, other than statements of historical fact that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future are forward-looking statements. Forward-looking statements in this news release include statements regarding (i) the proceeds to be raised pursuant to the equity facility; (ii) resale restrictions relating to the securities to be issued; (iii) the equity facility fueling the Company's expansion and enabling the Company to grow profitably; and (iv) the Company's strategy and business plan. The forward-looking statements reflect management's current expectations based on information currently available and are subject to a number of risks and uncertainties that may cause outcomes to differ materially from those discussed in the forward-looking statements including: (i) adverse market conditions; (ii) the inability of the Company to complete any Offering at all or on the terms announced; or (iii) the Company not receiving all necessary regulatory approvals. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and, accordingly, undue reliance should not be put on such statements due to their inherent uncertainty. Factors that could cause actual results or events to differ materially from current expectations include general market conditions and other factors beyond the control of the Company. The Company expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law.
SOURCE Koios Beverage Corp.
For further information: Paula Arab, Media and Investor Relations Strategist, [email protected], 403-889-9128