Kaival Brands Innovations Group, Inc., (NASDAQ: KAVL) (“Kaival
Brands”, the “Company”), the exclusive U.S. distributor of all
products manufactured by Bidi Vapor, LLC ("Bidi Vapor"), today
announced the pricing of a public offering of 3,921,500 units at a
public offering price of $1.53 per unit (the “Offering”). Each unit
consists of one share of common stock (or one pre-funded warrant to
purchase one share of common stock in lieu thereof) and one and
one-half common warrants to purchase one and one-half shares of
common stock. The common warrants will have an exercise price of
$1.53 per share, are exercisable immediately and will expire five
years following the date of issuance. Gross proceeds from the
Offering, before deducting the placement agent's fees and other
offering expenses, are expected to be approximately $6.0 million.
Maxim Group LLC is acting as sole placement
agent in connection with the Offering.
The Company intends to use the net proceeds from
the Offering for general corporate and working capital purposes and
to fund ongoing operations and expansion of its business. The
closing of the Offering is expected to occur on or about June 24,
2024, subject to the satisfaction of customary closing
conditions.
A registration statement on Form S-1 (File No.
333-279045) relating to the sale of these securities, as amended,
was declared effective by the Securities and Exchange Commission
(the "SEC") on June 21, 2024 and the Company’s registration
statement on Form S-1MEF filed with the SEC on June 21, 2024 became
effective upon filing. This offering is being made only by means of
a prospectus. A final prospectus relating to the offering will be
filed with the SEC and will be available on the SEC's website at
http://www.sec.gov. Electronic copies of the prospectus may be
obtained, when available, by contacting Maxim Group LLC, at 300
Park Avenue, 16th Floor, New York, NY 10022, Attention: Syndicate
Department, by telephone at (212) 895-3745 or by email at
syndicate@maximgrp.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 Kaival Brands
Based in Grant-Valkaria, Florida, Kaival Brands
is a company focused on incubating and commercializing innovative
products into mature and dominant brands, with a current focus on
the distribution of electronic nicotine delivery systems (ENDS)
also known as “e-cigarettes” for use by customers 21 years and
older. Our business plan is to seek to diversify into distributing
other nicotine and non-nicotine delivery system products (including
those related to hemp-derived cannabidiol (known as CBD) products).
Kaival Brands and Philip Morris Products S.A. (via sublicense from
Kaival Brands) are the exclusive global distributors of all
products manufactured by Bidi Vapor LLC. Based in Melbourne,
Florida, Bidi Vapor maintains a commitment to responsible,
adult-focused marketing, supporting age-verification standards and
sustainability through its BIDI® Cares recycling program. Bidi
Vapor's premier device, the BIDI® Stick, which is distributed
exclusively by Kaival Brands, is a premium product made with
high-quality components, a UL-certified battery and technology
designed to deliver a consistent vaping experience for adult
smokers 21 and over. Nirajkumar Patel, the Company’s Chief
Executive Officer and director, owns and controls Bidi Vapor. As a
result, Bidi Vapor is considered a related party of the
Company.
Learn more about Kaival Brands at
https://ir.kaivalbrands.com/overview/default.aspx.
Cautionary Note Regarding Forward-Looking
Statements
This press release and the statements of the
Company’s management and partners included herein and related to
the subject matter herein includes statements that constitute
“forward-looking statements” (as defined in Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended), which are statements
other than historical facts. You can identify forward-looking
statements by words such as “anticipate,” “believe,” “continue,”
“could,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,”
“position,” “should,” “strategy,” “target,” “will,” and similar
words. All forward-looking statements speak only as of the date of
this press release. Although we believe that the plans, intentions,
and expectations reflected in or suggested by the forward-looking
statements are reasonable, there is no assurance that these plans,
intentions, or expectations will be achieved. Therefore, actual
outcomes and results could materially and adversely differ from
what is expressed, implied, or forecasted in such statements. Our
business may be influenced by many factors that are difficult to
predict, involve uncertainties that may materially affect results,
and are often beyond our control. Factors that could cause or
contribute to such differences include, but are not limited to: (i)
actions taken by Bidi Vapor and the courts in response to the FDA’s
January 2024 MDO on its Classic Bidi Stick, (ii) future actions by
the FDA relating to the PMTAs for Bidi Vapor’s 10 other flavors
that could adversely impact our business and prospects, including
the outcome of FDA’s scientific review of Bidi Vapor’s pending
PMTAs, (iii) the results of international marketing and sales
efforts by Philip Morris International, the Company’s international
distribution partner, (iv) how quickly domestic and international
markets adopt our products, (v) the scope of future FDA enforcement
of regulations in the ENDS industry, (vi) the FDA’s approach to the
regulation of synthetic nicotine and its impact on our business,
(vii) potential federal and state flavor bans and other
restrictions on ENDS products, (viii) general economic uncertainty
in key global markets and a worsening of geopolitical and economic
conditions, including low levels of economic growth, (ix) the
effects of steps that we are taking to raise capital, reduce
operating costs and diversity our product offerings, (x) our
inability to generate and sustain profitable sales growth,
including sales growth in U.S. and international markets, (xi)
circumstances or developments that may make us unable to implement
or realize anticipated benefits, or that may increase the costs, of
our current and planned business initiatives, (xii) significant
changes in our relationships with our distributors or
sub-distributors and (xiii) other factors detailed by us in our
public filings with the Securities and Exchange Commission,
including the disclosures under the heading “Risk Factors” in our
Annual Report on Form 10-K for the fiscal year ended October 31,
2023, filed with the Securities and Exchange Commission on February
14, 2024 and our subsequent Quarterly Reports on Form 10-Q and
accessible at www.sec.gov. All forward-looking statements included
in this press release are expressly qualified in their entirety by
such cautionary statements. Except as required under the federal
securities laws and the Securities and Exchange Commission’s rules
and regulations, we do not have any intention or obligation to
update any forward-looking statements publicly, whether as a result
of new information, future events, or otherwise.
Contact: Brett Maas, Managing
PartnerHayden IR(646) 536-7331brett@haydenir.com
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