Cloud DX Inc (TSX-V:CDX, OTCQB:CDXFF) said it has closed the first tranche of a private placement of units of the corporation for aggregate gross proceeds of $2,601,884 and has received commitments for the second tranche of approximately $1.1 million.
The corporation intends to use the net proceeds of the private placement for inventory, sales, marketing (particularly in the United States), working capital and for general corporate purposes.
The company expects to close the second and final tranche of the private placement on or before March 31, 2023.
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Each unit in the placement comprises one common share in the capital of the corporation and one common share purchase warrant. Each warrant entitles the holder thereof to purchase one additional common share at a price of 21 cents per common share for a period of three years following the issuance of such warrant, subject to accelerated expiry.
If, at any time, the closing price of the corporation's common shares is greater than 42 cents per common share for 20 consecutive trading days, the corporation may provide written notice to the holders that the expiry of the warrants shall be accelerated to a date that is not less than 15 days from the date of the warrant acceleration notice.
In connection with the closing of the first tranche of the private placement, investors subscribed for 18,584,878 units at a price of 14 cents per unit for aggregate gross proceeds of $2,601,884. The common shares and warrants comprising the units will be subject to a four-month hold period.
Insiders of the corporation subscribed for 12,942,028 units for aggregate gross proceeds of $1,811,884. Their participation in the private placement constitutes a related party transaction within the meaning of Multilateral Instrument 61-101, Protection of Minority Security Holders in Special Transactions.
The corporation paid finders' fees of 8% in cash and 8% in broker warrants on a portion of the private placement to certain finders, in accordance with the policies of the TSX Venture Exchange.
The corporation issued a total of 259,597 broker warrants and paid cash commissions of $36,344 in connection with the first tranche closing of the private placement, such broker warrants being convertible into common shares.
Cloud Dx's Connected Health remote patient monitoring platform is used by healthcare enterprises and care teams across North America to virtually manage chronic disease, enable aging in place, and deliver hospital-quality postsurgical care at home.
Providers partnering with Cloud Dx achieve better health care and patient outcomes, reduce the need for hospitalization/rehospitalization, and reduce health care delivery costs through more efficient use of resources.
Contact the author at jon.hopkins@proactiveinvestors.com