Usually a cut-out or a punch-hole on an item means that the item for some reason was rejected during pressing, due to manufacturing defects (for example sleeve coloring, vinyl final weight, labelling etc) or other deviations from the manufacturing plant's processes and procedures. In some cases, a company decides not to destroy/recycle these items but to give them as "promos" to radio stations etc, in order to "save" good copies of the product and release them to the market (usually this happens with limited pressings).
It all depends on the manufacturing plant's or the record company's SOP's.
According to a friend of mine who used to work in a record company, sometimes a cut out or a punch-hole does in fact indicate an item (without defects) that was given in order to promote a release, but this doesn't come from the record company itself (otherwise it would have a promo sticker). Certain managers get an amount of copies to give to friends, radio dj's, journalists etc. and they make cut-outs/punch-holes in order to prevent others from selling the item as "new". Again, this also depends on the company's SOP's
"Columbia" and all affiliated companies (for example "Chrysalis") used to make cut-outs/punch-holes on vinyls during the 80's and 90's. And this was a policy that was followed with vinyl releases not only from the US, but also from Germany (or West Germany) and Greece.
By the way, cut-out or not, the Mad Season LP rocks!!!

According to MoV a re-issue is on the way. Maybe in time for Record Store day?