Cloud DX Inc. Announces Update to Brokered Private Placement

Rhea-AI Summary

Cloud DX Inc. has updated the terms of its private placement of Convertible Debenture Units, aiming to raise up to $3.45 million. The offering involves 3,000 units priced at $1,000 each, with a potential additional 450 units. Each unit consists of a $1,000 principal amount unsecured convertible debenture and 1,430 warrants. The debentures will mature in 36 months at a 10% interest rate. Proceeds will fund sales, marketing, R&D, and general operations, pending approval by the TSX Venture Exchange.

Positive

• Updated offering could raise up to $3.45 million, enhancing financial position.
• Convertible debentures and warrants provide potential for future equity conversion.

Negative

• The offering may lead to shareholder dilution if convertible debentures are exercised.

KITCHENER, ON / ACCESSWIRE / January 13, 2022 / Cloud DX Inc. ("Cloud DX" or the "Company") (TSXV:CDX) announces that it has updated the terms of its private placement previously announced on January 4, 2022 of Convertible Debenture Units (the "Updated Offering") with Echelon Wealth Partners Inc. as lead agent and sole book runner (the "Agent"). The Company expects the initial closing of the Updated Offering will be on or about January 25, 2022.

In connection with the Updated Offering the Agent will offer for sale up to 3,000 convertible debenture units of the Company (the "Convertible Debenture Units") at a price of $1,000 per Convertible Debenture Unit for aggregate gross proceeds of up to $3,000,000. The Agent has been granted an option to sell up to 450 additional Convertible Debenture Units for maximum aggregate gross proceeds under the Updated Offering of $3,450,000. Pursuant to the Updated Offering, each Convertible Debenture Unit will be comprised of $1,000 principal amount unsecured convertible debenture (each, a "Debenture") and 1,430 common share purchase warrants of the Company (each, a "Warrant"). The Debentures will mature on the date that is 36 months from the date of issuance (the "Maturity Date") and shall bear interest at a simple rate of 10% per annum. Interest will be payable quarterly on the last business day of each quarter, commencing on March 31, 2022. The principal amount of the Debentures, or any portion thereof, may be converted at the election of the holder thereof into common shares in the capital of the Company ("Common Shares") at a conversion price of $0.35 per Common Share (the "Conversion Price") at any time prior to the Maturity Date. Each Warrant will entitle the holder thereof to acquire one Common Share at a price of $0.50 per Common Share for a period of 24 months from the closing date of the Updated Offering.

The Company has agreed to: (i) pay the Agent a cash fee equal to 8% of the gross proceeds raised from the Updated Offering (reduced to 3% for subscribers identified on the Company's president's list); and (ii) issue to the Agent such number of non-transferable Common Share purchase warrants (the "Agent's Warrants") as is equal to 8% of the gross proceeds raised from the Updated Offering (reduced to 3% for subscribers identified on the Company's president's list) divided by the Conversion Price. Each Agent's Warrant will entitle the holder thereof to acquire one Common Share at an exercise price of $0.35 per Common Share for a period of 24 months from the closing date of the Updated Offering.

The Company intends to use the net proceeds of the Updated Offering for sales, marketing, research and development, and for general working capital purposes.

The Convertible Debenture Units, Debentures, Warrants, and any securities issuable upon conversion or exercise thereof, will be subject to a statutory hold period of four months and one day from the date of issuance of the Convertible Debenture Units. The Updated Offering is subject to final approval by the TSX Venture Exchange.

The Convertible Debenture Units will be offered and sold by private placement in Canada pursuant to exemptions from the prospectus requirements under National Instrument 45-106 - Prospectus Exemptions, and in certain other jurisdictions on a basis which does not require the qualification or registration of the Convertible Debenture Units, Debentures, Warrants, or any underlying securities.

About Cloud DX

Accelerating virtual healthcare, Cloud DX is on a mission to make healthcare better for everyone. Our 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 post-surgical care in the home. Our partners achieve better healthcare and patient outcomes, reduce the need for hospitalization or re-admission, and reduce healthcare delivery costs through more efficient use of resources. Cloud DX is the co-winner of the Qualcomm Tricorder XPRIZE, a 2021 Edison Award winner, a Fast Company "World Changing Idea" finalist, and one of "Canada's Ten Most Prominent Telehealth Providers." In 2021, Cloud DX became an exclusive partner of Medtronic Canada.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. The TSX Venture Exchange has in no way passed upon the merits of the Updated Offering and has neither approved nor disapproved the content of this press release.

Social Links

Twitter: https://twitter.com/CloudDX
Facebook https://www.facebook.com/clouddxinc/
LinkedIn https://www.linkedin.com/company/cloud-dx/
Instagram https://www.instagram.com/cloud.dx/

For media inquiries please contact:

Janine Scott
Marketing Lead
888-543-0944
janine.scott@CloudDX.com

For investor inquiries please contact:

Jay Bedard
Cloud DX Investor Relations
647-881-8418
jay.bedard@CloudDX.com

SOURCE: Cloud DX Inc.

View source version on accesswire.com:
https://www.accesswire.com/683479/Cloud-DX-Inc-Announces-Update-to-Brokered-Private-Placement

FAQ

What is the purpose of Cloud DX's updated private placement?

The updated private placement aims to raise funds for sales, marketing, research and development, and general working capital.

When is the expected closing date for the updated offering by Cloud DX?

The expected initial closing date for the updated offering is on or about January 25, 2022.

What are the terms of the convertible debenture units offered by Cloud DX?

The convertible debenture units are priced at $1,000 each, with a maturity of 36 months and a 10% interest rate, convertible into common shares at $0.35.

How much can Cloud DX raise through the updated offering?

Cloud DX can raise up to $3.45 million through the updated offering.

What are the key features of the warrants associated with Cloud DX's offering?

Each warrant allows the holder to acquire one common share at $0.50 for a period of 24 months from the closing date.