American Virtual Cloud Technologies announced that it has filed a resale registration statement on Form S-3 as part of several initiatives to raise growth capital and improve liquidity through an increased share float. Pursuant to its recent S-3 filing, AVCtechnologies has completed the registration of 37,916,668 shares which underlie warrants that were previously issued in accordance with previously announced financing transactions. These financings are a critical step in the company’s fundraising plan and will enable it to execute on its strategic growth initiatives such as the recently announced partnerships with Braidio and Etisalat.
If all the warrants issued in the previously announced financing transactions are exercised, AVCtechnologies would receive approximately $41 million in incremental cash on its balance sheet, based on the warrant exercise prices, which currently range from $1.50 to $2.00 per share. To date, the Company has already raised approximately $35 million from the previously announced financing transactions. Full exercise of these warrants would also increase the public float of AVCtechnologies stock by nearly 19 million shares, as only half of the registered shares will actually be issued absent any adjustments to the terms of the warrants. The resale registration statements filed in connection with the financing transactions have registered 200% of the number of shares currently issuable upon exercise of the warrants, to comply with obligations under the transaction documents to “over-register” shares to provide for potential repricing of warrant strike prices without the need for additional registration statement filings. No dilution will occur from any non-issued registered shares.
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Larry Mock, Chairman of the Board of AVCtechnologies, said, “With the latest S-3 filing, Phase I of our funding plan is complete and the Company will benefit from increased liquidity in the marketplace to the extent the remaining warrants are exercised. We are now in position to execute on Phase 2 of our funding strategy, the planned divestiture of Computex Technology Group, the proceeds from which, coupled with the Phase 1 proceeds, are expected to completely eliminate the Company’s debt and fully fund our plan.”
Darrell J. Mays, CEO of AVCtechnologies, said, “Any additional capital received from the sale of these securities will be beneficial as we continue to expand our product offerings and accelerate our existing growth strategies with large enterprise customers.” AVCtechnologies previously announced that revenues of its Kandy Business Unit are projected to grow from $14.3 million in 2020 to approximately $18.8 million in 2021 and to more than $37 million in 2022.
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