ToughBuilt Industries Announces Pricing of $3.5 Million Public Offering
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Insights
The announcement by ToughBuilt Industries regarding the public offering of shares and associated warrants is a significant event that is likely to influence the company's stock liquidity and capital structure. The pricing at $4.53 per share, with warrants exercisable at $4.405, suggests a strategic move to attract investors by offering a potential discount on future share purchases through the warrants. This could indicate an aggressive capital raising strategy to fund expansion or to strengthen the company's balance sheet.
Investors should note the dilutive effect of such an offering, as the increase in the number of shares could lead to a decrease in existing shareholders' equity. The timing and size of this offering can also reflect the company's confidence in its current valuation and future prospects. It's also essential to assess the company's use of the proceeds from this offering, as it may impact future growth and profitability.
The exercise price of the warrants being slightly below the public offering price is a typical incentive used in equity financing. It is important to evaluate the market's reception of this offering, as it could serve as a barometer for investor confidence in ToughBuilt's market position and growth trajectory. Additionally, the five-year expiry on the warrants provides a long-term perspective, which could appeal to investors who believe in the company's long-term value proposition.
Furthermore, the industry context in which ToughBuilt operates should be considered. As a company in the manufacturing sector, it faces competition and market forces that can significantly impact its performance. The capital raised through this offering could be pivotal in maintaining a competitive edge through research and development, marketing initiatives, or strategic acquisitions.
From a legal standpoint, the structuring of the offering with both common stock and pre-funded warrants is a maneuver that provides flexibility for investors and the company. Pre-funded warrants are often used as an alternative for investors who may not want to purchase common stock immediately but are interested in maintaining the option to do so in the future. The legal framework for such offerings is governed by securities law, which mandates full disclosure of terms to potential investors.
It is crucial for investors to understand the terms of the warrants, including the exercise price, exercisability and expiration date, as they can significantly affect the potential return on investment. The closing of the offering is contingent on standard regulatory approvals and customary closing conditions, which must be closely monitored for any potential delays or complications that could affect investor sentiment and the company's financial strategy.
IRVINE, Calif., Feb. 14, 2024 (GLOBE NEWSWIRE) -- ToughBuilt Industries, Inc. (“ToughBuilt” or the “Company”) (NASDAQ: TBLT; TBLTW), today announced the pricing of a 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. is acting as the exclusive placement agent for the offering.
The gross proceeds to the Company from the offering are expected to be 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 will be made only by means of a prospectus, which is part of the effective registration statement. A preliminary prospectus relating to the offering has been filed with the SEC. When available, 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 has agreed to amend 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 have 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 statements concerning the anticipated closing and closing date of 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, (xiii) the consummation of the offering, (xiv) our satisfaction of the closing conditions in this offering and our use of the net proceeds in this offering, and (xv) 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
FAQ
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