MTech Acquisition Corp. and MJ Freeway LLC Provide Private Placement Update

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NEW YORK, June 12, 2019 (GLOBE NEWSWIRE) -- MTech Acquisition Corp. (NASDAQ: MTEC, MTECU, MTECW) (“MTech”), the first US-listed Special Purpose Acquisition Company (SPAC) focused on acquiring a business ancillary to the cannabis industry, and MJ Freeway LLC (“MJ Freeway”), a leading seed-to-sale, regulatory compliance technology provider and developer of the cannabis industry’s first enterprise resource planning (ERP) platform, announced today that MTech has agreed to issue and sell an additional 215,475 shares of Class A common stock at $10.21 per share as part of its previously announced private placement. 

Overall, MTech will issue and sell an aggregate of 901,074 shares of Class A common stock for aggregate gross proceeds of approximately $9.2 million. The Company does not expect to issue any additional shares in the private placement. The closing of the private placement is conditioned on the closing of the business combination immediately thereafter.

In connection with the proposed business combination of MTech and MJ Freeway, as previously announced, the two companies will be combined under a new holding company, MTech Acquisition Holdings Inc. (“Pubco”), which will be renamed Akerna Corp. following the closing of the business combination. The shares of Class A Common Stock issued in the private placement will convert into shares of Pubco common stock on a one-for-one basis upon the closing the business combination.

Cresco Capital Partners II, LLC (CCP II), an existing investor in MJ Freeway, joins previously reported Khitan Capital, LLC (Khitan) and The London Fund in the private placement.

“As an existing MJ Freeway investor, making this investment in Akerna was an easy choice considering the trend of global legalization we are seeing, especially in Asian markets. We believe Akerna is well-positioned to capitalize on this growth through their robust ERP offerings and tracking & compliance technology,” stated MJ Freeway Board Member and Khitan’s Emery Huang. "Further, we believe the value proposition with the pending merger and Nasdaq listing enhances Akerna's financial position and opens the door to acquisition opportunities, which should drive further shareholder value.”

Matt Hawkins, Managing Principal at CCP II, currently invested in MJ Freeway, said, “We have high confidence in the growth of the technology sector in cannabis, the strategic direction of Akerna, and the leadership at MJ Freeway. This additional stake in Akerna reflects that confidence.”

The London Fund’s founder Ashesh C. Shah, who is expected to serve as a technology advisor to the Akerna Board of Directors, explained, “We are excited about this investment in Akerna and we believe my role as technology advisor will help accelerate organic and inorganic growth in the company.”

“The significant investments of financing, expertise, and confidence from our private placement participants will be invaluable as we move into this monumental new chapter. I look forward to expanding our relationships with Mr. Huang and Mr. Shah, leveraging additional global market and tech insights for strategic growth, and I thank Mr. Hawkins for his continued support,” stated Jessica Billingsley, Co-Founder and Chief Executive Officer (CEO) of MJ Freeway.

Scott Sozio, CEO of MTech, commented, “MJ Freeway has an established history of delivering technological innovation to the cannabis industry. Securing this investment provides additional capital to grow our proprietary ERP platform and further establish Akerna as a dominant force in cannabis technology.”

Concurrently with the closing of the private placement, the investors in the private placement will also receive from MTech Sponsor LLC, the sponsor of MTech, an aggregate of 100,119 shares of previously-issued shares of Class B Common Stock, which shares will remain in escrow and continue to be subject to restrictions on transfer following the consummation of the business combination. For additional information, please see MTech’s Current Report on Form 8-K that was filed with the Securities and Exchange Commission (SEC) on June 6, 2019, and MTech’s Current Report on Form 8-K to be filed with the SEC today.

More news and information about MJ Freeway

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Globe Newswire: 13:00 GMT Wednesday 12th June 2019

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