Catalist-listed QT Vascular says a New York-based private alternative investment group, GEM Global Yield Fund, has agreed to provide it with up to $10 million in capital commitment over the next 30 months.
The medical technology company has also agreed to issue 35 million warrants to GEM Global, each carrying the right to subscribe for one new ordinary share its company. This will be exercisable for a period of five years from the issue date at a fixed price of 10 cents each.
The warrants are expected to be issued within 45 days from the date of the agreement.In a Tuesday filing, QT Vascular explains that the initial $10 million will allow it to drawdown, funds during the 30-month term by issuing its ordinary shares to GEM Global, subject to a share lending arrangement being in place.
At QT Vascular’s discretion, it can also opt for an additional $10 million commitment from GEM Global on the same terms identical to the agreement, with a period of six months from the date of the agreement.
The company adds that it will control the timing and maximum amount of drawdown under this facility, and has no obligation to draw on the funds on offer.
QT Vascular believes the funds will “significantly strengthen its business by enabling it to repay existing borrowings that are due and improve its gearing ratio; improve its cash flow; as well as increase production to support the increase in demand for its product, the non-drug-coated Chocolate PTA.
It also intends to use the funding for general corporate purposes, such as the advancement of its drug-coated Chocolate program, as well as the group’s strategic partnership discussions.
This agreement gives QT Vascular some strong alternatives as it secures funding for continued growth and development of the company over the next few years, comments CEO Eitan Konstantino.
It places QT Vascular in a commanding position to continue with its business and strategic partnership plans, improve the group’s cash flow and increase production to support market demand for our products, he adds.Shares of QT Vascular closed flat at 5 cents on Tuesday.
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