ToughBuilt Industries Announces Closing of $3.5 Million Public Offering
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Insights
The completion of ToughBuilt Industries, Inc.'s public offering and the associated amendment of existing warrants represent a strategic move to bolster the company's financial position. The capital raised, approximately $3.5 million, is earmarked for general corporate purposes, including working capital, which indicates a focus on sustaining operations and potentially funding growth initiatives.
From a financial perspective, the pricing of the offering at $4.53 per share, with an exercise price of the warrants at $4.405, is a critical metric. It suggests that the company is seeking to incentivize investment at a price point that is appealing to new investors while also considering the interests of current shareholders. The reduction in exercise price of the previously issued warrants from over $18 to $4.405 could potentially dilute existing shareholders but may also align with the current market valuation, making it easier for warrant holders to exercise their rights and invest more capital into the company.
Investors should note the implications of this offering on ToughBuilt's market capitalization and earnings per share, as the introduction of new shares could lead to dilution. However, if the capital is deployed effectively to stimulate growth or improve the company's financial health, the long-term benefits might outweigh the short-term dilution effects.
Examining the broader market implications, ToughBuilt's public offering and warrant amendments can be seen as a response to market conditions and capital needs. The construction and building tools sector, where ToughBuilt operates, is highly competitive and capital-intensive. Therefore, the ability to raise capital through equity offerings is a significant aspect of a company's strategic financial management.
It is also essential to consider investor sentiment and market reception to such offerings. The exercise price of the warrants being close to the offering price suggests that the company and its placement agent, H.C. Wainwright & Co., have calibrated the offering to market expectations. The market's response to this offering will be an indicator of investor confidence in ToughBuilt's future prospects and management's ability to deploy the raised funds effectively.
Furthermore, the timing of the offering and the amendment of existing warrants should be evaluated in the context of the company's recent performance and future outlook. If ToughBuilt can demonstrate a clear roadmap for utilizing the proceeds to drive value, it may positively influence the stock's performance in the medium to long term.
The legal intricacies of ToughBuilt's public offering are underscored by the filing of a registration statement on Form S-1 with the SEC, which was declared effective prior to the offering. This legal compliance ensures that all material information is available to potential investors, adhering to transparency and disclosure regulations.
Additionally, the amendment of the exercise prices of previously issued warrants is a significant legal move. It requires careful navigation of securities laws and regulations to ensure fairness to all stakeholders. The reduction in exercise prices could be seen as a measure to maintain the attractiveness of the company's warrants in a fluctuating market, which could also reflect adjustments in the company's valuation since the initial warrant issuance.
Prospective and current investors should pay attention to the final prospectus filed with the SEC to understand the terms, risks and potential benefits associated with the offering and the amended warrants. Such documents are vital for making informed investment decisions and assessing the legal standing of the offering.
IRVINE, Calif., Feb. 16, 2024 (GLOBE NEWSWIRE) -- ToughBuilt Industries, Inc. (“ToughBuilt” or the “Company”) (NASDAQ: TBLT; TBLTW), today announced the closing of its previously announced public offering of 772,628 shares of its common stock (or pre-funded warrants in lieu thereof), together with warrants to purchase up to 772,628 shares of its common stock at an offering price to the public of
H.C. Wainwright & Co. acted as the exclusive placement agent for the offering.
The gross proceeds to the Company from the offering were approximately
A registration statement on Form S-1 (File No. 333-276008) relating to these securities has been filed with the Securities and Exchange Commission, or the SEC, and was declared effective by the SEC on February 13, 2024. The offering was made only by means of a prospectus, which is part of the effective registration statement. A final prospectus relating to the offering has been filed with the SEC. Electronic copies of the final prospectus may be obtained for free on the SEC’s website located at http://www.sec.gov and may also be obtained by contacting H.C. Wainwright & Co., LLC at 430 Park Avenue, 3rd Floor, New York, NY 10022, by phone at (212) 856-5711 or e-mail at placements@hcwco.com.
The Company also amended certain existing warrants to purchase up to an aggregate of 279,278 shares of the Company’s common stock that were previously issued in June 2023 and August 2023 and had exercise prices of
This press release does not constitute an offer to sell or the solicitation of an offer to buy any of the securities described herein, nor shall there be any sale of these securities in any state or other 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 other jurisdiction.
ABOUT TOUGHBUILT INDUSTRIES, INC.
ToughBuilt is an innovative advanced product developer, manufacturer, and distributor with emphasis on innovative products, currently focused on tools and other accessories for the professional and do-it-yourself construction industries. We market and distribute various home improvement and construction product lines for both the do-it-yourself and professional markets under the TOUGHBUILT brand name, within the global multibillion dollar per year tool market industry. All our products are designed by our in-house design team. Since launching product sales in 2013, we have experienced significant annual sales growth. Our current product line includes three major categories, with several additional categories in various stages of development, consisting of Hand tools, Storage and Job Site support equipment. Our mission is to provide products to the building and home improvement communities that are innovative, of superior quality derived in part from enlightened creativity for our end users while enhancing performance, improving well-being, and building high brand loyalty. Additional information about the Company is available at: https://www.toughbuilt.com/.
FORWARD-LOOKING STATEMENTS
This press release contains “forward-looking statements.” Such statements include, but are not limited to, statements regarding the intended use of proceeds from the offering and may be preceded by the words “intends,” “may,” “will,” “plans,” “expects,” “anticipates,” “projects,” “predicts,” “estimates,” “aims,” “believes,” “hopes,” “potential” or similar words. Forward-looking statements are not guarantees of future performance, are based on certain assumptions, and subject to various known and unknown risks and uncertainties, many of which are beyond the Company’s control, and cannot be predicted or quantified and consequently, actual results may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include, without limitation, risks and uncertainties associated with, (i) supply chain disruptions, (ii) market acceptance of our existing and new products, including the Company’s StackTech® mobile stacking toolbox system (iii) delays in bringing products to key markets, (iv) an inability to secure regulatory approvals for the ability to sell our products in certain markets, (v) intense competition in the industry from much larger, multinational companies, (vi) product liability claims, (vii) product malfunctions, (viii) our limited manufacturing capabilities and reliance on subcontractors for assistance, (ix) our efforts to successfully obtain and maintain intellectual property protection covering our products, which may not be successful, (x) our reliance on single suppliers for certain product components, (xi) the fact that we will need to raise additional capital to meet our business requirements in the future and that such capital raising may be costly, dilutive or difficult to obtain, (xii) the fact that we conduct business in multiple foreign jurisdictions, exposing us to foreign currency exchange rate fluctuations, logistical and communications challenges, burdens and costs of compliance with foreign laws and political and economic instability in each jurisdiction, and (xiii) market and other conditions. More detailed information about the Company and the risk factors that may affect the realization of forward looking statements is set forth in the Company’s filings with the Securities and Exchange Commission (SEC), including the Company’s Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q. Investors and security holders are urged to read these documents free of charge on the SEC’s web site at http://www.sec.gov. The Company assumes no obligation to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise, except as required by law.
Investor Relations Contact:
KCSA Strategic Communications
David Hanover
ToughBuilt@KCSA.com
FAQ
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