Cipherloc Announces Final Close of $10.0 Million Offering of Common Stock

Rhea-AI Summary

Cipherloc Corporation (OTCQB:CLOK) announced the completion of its second and final closing of a Securities Purchase Agreement, raising a total of approximately $10.0 million before expenses. This funding will support the commercialization of its advanced quantum-resistant encryption technology, specifically the FIPS-140-2 certified Polymorphic Encryption Core. The offering consisted of around 55.5 million shares and warrants sold at $0.18 each, representing 80% of the stock's closing price on March 30, 2021. Officers and directors have agreed to a 180-day lock-up on their shares.

Positive

• Total gross proceeds increased to $10.0 million, strengthening the company's balance sheet.
• The funding supports commercialization of quantum-resistant encryption technology, targeting future tech needs.

Negative

• Issuance of approximately 55.5 million shares may dilute existing shareholder value.

AUSTIN, TX / ACCESSWIRE / April 21, 2021 / Cipherloc Corporation (OTCQB:CLOK) ("CipherLoc"), a developer of advanced encryption technology, today announced completion of a second and final closing of its Securities Purchase Agreement announced on April 7, 2021. The second closing increases total gross proceeds to the Company to approximately $10.0 million before deducting offering expenses payable by the Company.

Said David Chasteen, Chief Executive Officer, "This second closing brings total proceeds to $10.0 million before expenses, providing for a strengthened balance sheet as we drive commercialization of our quantum resistant technology with multiple partners. We believe that the shift to post-quantum encryption is only now beginning, and will be one of the top technology needs over the next several years. Our FIPS-140-2 certified Polymorphic Encryption Core (PEC) is fully ready for commercial applications with our partners and customers."

The offering equates to approximately 55.5 million Shares of common stock and Warrants to purchase 55.5 million shares of common stock in the Company in aggregate.

The Shares and Warrants were sold at a price of $0.18 per combined Share and Warrant, which was equal to 80% of the closing sales price of the Company's common stock on March 30, 2021, which was the last trading day prior to the entry into the Purchase Agreement. The Warrants are good for a term of five years and have an exercise price of $0.36 per Share.

Paulson Investment Company, LLC (the "Placement Agent"), acted as the exclusive placement agent in connection with this Offering.

In connection with the Offering, each of Cipherloc's officers and directors entered into Lock-Up Agreements whereby they agreed not to sell, offer, or transfer, any of their securities which they hold for 180 days after the end of the Offering, subject to customary exceptions.

Financial terms and additional information regarding the funding transactions are available in Cipherloc's Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission on April 8, 2021, a Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission on April 20, 2021, and available at www.sec.gov.

This press release does not constitute an offer to sell any securities or a solicitation of an offer to buy any securities, nor shall there be any sale of any securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Cipherloc Corporation (OTCQB:CLOK)
Cipherloc Corporation provides advanced technology and expertise to secure your data Cipherloc Corporation provides advanced technology and expertise to secure your data and safeguard your privacy with the speed you need today and the agility you'll need tomorrow. Our patented Polymorphic Encryption technology provides a layer of security that is stronger, adaptable, and scalable across a variety of applications and systems. Learn more at www.cipherloc.net.

Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning of, and within the safe harbor provided by the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements give our current expectations, opinions, belief or forecasts of future events and performance. A statement identified by the use of forward-looking words including "will," "may," "expects," "projects," "anticipates," "plans," "believes," "estimate," "should," and certain of the other foregoing statements may be deemed forward-looking statements. Although Cipherloc believes that the expectations reflected in such forward-looking statements are reasonable, these statements involve risks and uncertainties that may cause actual future activities and results to be materially different from those suggested or described in this news release. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. In evaluating such statements, prospective investors should review carefully various risks and uncertainties identified in this release and matters set forth in the Company's SEC filings. These risks and uncertainties could cause the Company's actual results to differ materially from those indicated in the forward-looking statements. The Company takes no obligation to update or correct its own forward-looking statements, except as required by law, or those prepared by third parties that are not paid for by the Company. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.

Investor Contact:
Matt Kreps
Darrow Associates Investor Relations
214-597-8200
mkreps@darrowir.com

SOURCE: CipherLoc Corporation

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FAQ

What is the total amount raised in Cipherloc's latest offering (CLOK)?

Cipherloc raised approximately $10.0 million in its latest offering.

How many shares and warrants were issued in the offering by Cipherloc (CLOK)?

The offering included approximately 55.5 million shares and warrants.

What was the price per share and warrant in Cipherloc's offering (CLOK)?

The shares and warrants were sold at a price of $0.18 each.

What is the intended use of the funds raised by Cipherloc (CLOK)?

The funds are intended to support the commercialization of their quantum-resistant encryption technology.

What lock-up period have Cipherloc's officers and directors agreed to (CLOK)?

They agreed to a 180-day lock-up period on their securities following the offering.