NexTech AR Corp (CSE:NTAR) (OTCQB:NEXCF) said it has closed a private placement that raised $3,208,875 as the augmented reality company plans for more growth in 2020 and beyond.
The Toronto-based company said it will use the money to grow its sales and engineering teams, pursue strategic M&A opportunities, and for general working capital purposes.
“This financing provides the company with a healthy cash and inventory position of over $7.5 million - it’s highest ever - providing a solid foundation to support the company's rapid growth plans,” said CFO Kashif Malik in a statement on Friday.
NexTech sold 1,528,036 units for $2.10 apiece, with each unit consisting of one common share and one half share purchase warrant exercisable at $3 each for a period of two years and subject to acceleration provisions.
“We are very fortunate to have supportive investors, with a long-term strategic outlook, who continue to support our growth in 2020 and beyond,” said CEO Evan Gappelberg, noting that nine institutional, family office, and high net worth investors participated in offering and most of them have taken part in prior financing rounds.
Gappelberg said NexTech’s AR-enhanced virtual events platform is gaining rapid traction with global enterprise and government customers, as the need for video conferencing increases.
"As demand is surging at an ever-faster pace we are continuing to grow our sales and engineering teams, with four new hires in the past thirty days alone, bringing our talent base to over 50 people and we don’t see this trend slowing,” he said. “We are also actively looking for strategic acquisitions which sometimes requires cash + stock, making this capital raise both timely and strategic for our shareholders.”
A finder’s fee equal to 8% cash and 8% broker warrants will be paid. The broker warrants are exercisable at $2.10 per share for a period of two years and all securities issued are subject to a four-month hold period from the date of issuance.
NexTech said it has also issued 1 million, 3-year incentive stock options to its employees priced at $2.20 each.
Contact the author: [email protected]
Follow him on Twitter @PatrickMGraham