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8 April 2019

POET announces bridge financing exceeding needs till DenseLight sale

POET Technologies Inc of Toronto, Canada and San Jose, CA, USA — a designer and manufacturer of optoelectronic devices, including light sources, passive waveguides and photonic integrated circuits (PIC) for the sensing and datacom markets — has arranged over C$10m of financing, representing the minimum funding needed to bridge the firm to the anticipated sale of its Singapore-based DenseLight subsidiary for C$34.2-39.5m (announced in February, and due for completion in September, subject to certain conditions including shareholder and other approvals).

Acquired by POET in May 2016 for US$10.5m in common stock, DenseLight has been engaged primarily in developing new sensing and datacom products, including active devices for POET’s Optical Interposer platform.

The first component of the financing comprises the issue of up to C$14m of 12% convertible unsecured debentures, to be sold in multiple tranches over upcoming months (as needed) on a brokered private placement basis through financial advisors IBK Capital. Closing of the first tranche, for gross proceeds of about C$1.9m, occurred on 3 April (with IBK Capital paid a cash commission of 5% of the gross proceeds raised). Insiders of the firm (including all of its board of directors and senior management team) and IBK Capital subscribed for over 47% of the first tranche.

Further indications of interest amounting to C$1.6m from parties who could not participate in the first tranche are expected to be included in subsequent tranches over the next few months (each subject to approval by the TSX Venture Exchange).

The second component of the financing consists of a credit facility to be provided by Espresso Capital Ltd. POET has signed a term sheet for the bridge loan that (subject to execution of definitive loan documents and the approval of the TSX Venture Exchange) will give the firm access of up to C$6.6m (US$5m). The loan’s initial advance of C$2.6m (US$2m) is expected soon.

“The significant investment made by management and the board clearly demonstrates our strong confidence in the long-term success of POET,” says executive VP & chief financial officer Thomas Mika. “Additionally, as indicated when we announced the proposed sale of DenseLight, we upheld our commitment to finance the company without pursuing a highly dilutive equity raise,” he adds. “The combination of the two forms of financing, when completed should comfortably exceed our needs over the next several months, giving us maximum flexibility. The continued offering of convertible debentures is intended to allow our stockholders and new prospective investors to participate in the future growth of POET Technologies.”

The proceeds of the financing are expected to be used to advance the firm’s Optical Interposer Platform and for working capital and general corporate purposes.

See related items:

POET provides update on above-average trading activity

POET receives US$26–30m offer for DenseLight subsidiary

POET’s revenue grows over 20% in Q3/2018

POET introduces Optical Interposer Platform for co-packaging of electronic and optical components

POET completes acquisition of DenseLight

Tags: POET

Visit:  www.denselight.com

Visit:  www.poet-technologies.com

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