Protech Home Medical Announces Closing of $31.8 Million Short Form Prospectus Offering (Including Full Exercise of the Over-Allotment Option) and Concurrent Private Placements
NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES AND DOES NOT CONSTITUTE AN OFFER OF THE SECURITIES DESCRIBED HEREIN.
CINCINNATI, June 29, 2020 -- Protech Home Medical Corp. (the “Company”) (TSXV: PTQ) (OTCQX: PTQQF), a U.S.-based leader in the home medical equipment industry, focused on end-to-end respiratory care, is pleased to announce that it has closed its previously announced bought deal prospectus offering of 25,001,000 units (“Units”) at a price of $1.15 per Unit (the “Issue Price”) for aggregate gross proceeds of $28,751,150 (the “Public Offering”), which includes the exercise in full of the 15% over-allotment option. The syndicate of underwriters (the “Underwriters”) for the Public Offering was co-led by Beacon Securities Limited (“Beacon”), as sole bookrunner, and Canaccord Genuity Corp. (“Canaccord”). The Units under the Public Offering were offered and sold by way of a short form prospectus filed in British Columbia, Alberta and Ontario.
The Company is also pleased to announce that, concurrent with the Public Offering, it has closed: (i) its previously announced brokered private placement of 1,750,000 Units at the Issue Price for additional gross proceeds of $2,012,500 (the “Brokered Private Placement”), which was conducted by a syndicate of agents (the “Agents”) co-led by Beacon, as sole bookrunner, and Canaccord; and (ii) its previously announced non-brokered private placement of 927,825 Units at the Issue Price for additional gross proceeds of $1,067,000 (the “Non-Brokered Private Placement”, and together with the Brokered Private Placement, the “Private Placements” and, together with the Public Offering, the “Offerings”), with Gregory Crawford, Chairman and CEO of the Company, and Mark Greenberg, a director of the Company. The securities issued under the Private Placements are subject to resale restrictions, including, a Canadian and, in the case of the Non-Brokered Private Placement, an Exchange four-month hold period.
Each Unit is comprised of one common share of the Company (a “Common Share”) and one-half of one common share purchase warrant (each whole common share purchase warrant, a “Warrant”). Each Warrant is exercisable to acquire one Common Share at an exercise price of $1.60 per share, subject to adjustment in certain events, until June 29, 2021.
The Company intends to use the net proceeds of the Offering to increase the Company’s cash position and may be used to complete strategic acquisitions.
“We are thrilled to announce the closing of this oversubscribed financing, as it represents an important milestone in Protech’s evolution” commented Greg Crawford, CEO, and Chairman. “We want to thank our existing shareholders for their extraordinary support, and welcome new shareholders. We are excited to further execute on our growth strategy and this injection of capital will allow for an aggressive acceleration of our plan. We look forward to updating shareholders on our continued progress in the weeks to come.”
In consideration for the services provided by the Underwriters in connection with the Public Offering, the Company paid the Underwriters a commission equal to 5.5% of the gross proceeds raised under the Public Offering and issued to the Underwriters an aggregate of 1,375,055 non-transferable compensation options (the “Compensation Options”), which represents 5.5% of the total number of Units sold under the Public Offering. Each Compensation Option is exercisable into one Common Share at a price per Common Share that is equal to the Issue Price, subject to adjustments in certain events, until June 29, 2022.
In consideration for the services provided by the Agents in connection with the Brokered Private Placement, the Company paid the Agents a commission equal to 5.5% of the gross proceeds raised under the Brokered Private Placement and issued to the Agents an aggregate of 96,250 non-transferable broker warrants (the “Broker Warrants”), which represents 5.5% of the total number of Units sold under the Brokered Private Placement. Each Broker Warrant is exercisable into one common share in the capital of the Company (a “Common Share”) at a price per Common Share that is equal to the Issue Price, subject to adjustments in certain events, until June 29, 2022.
The Offering is subject to final acceptance of the TSX Venture Exchange (“TSXV”). The TSXV has conditionally accepted the Offering.
By virtue of the participation of Gregory Crawford and Mark Greenberg, each an insider of the Company, the Non-Brokered Private Placement constitutes a "related party transaction", as defined under Multilateral Instrument 61-101 (“MI 61-101”). The Non-Brokered Private Placement is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 as neither the fair market value of any securities issued to nor the consideration paid by such insiders would exceed 25% of the Company’s market capitalization.
The securities referred to in this news release have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons absent U.S. registration or an applicable exemption from the U.S. registration requirements. This press release does not constitute an offer for sale of securities, nor a solicitation for offers to buy any securities in the United States, nor in any other jurisdiction in which such offer, solicitation or sale would be unlawful. Any public offering of securities in the United States must be made by means of a prospectus containing detailed information about the company and management, as well as financial statements.