MyFiziq targets end of year NASDAQ listing via funding agreement
MyFiziq Limited (ASX: MYQ) has executed a formal funding agreement for US$1.5 million with Asia Cornerstone Asset Management (ACAM) by way of an unsecured convertible note with the capital being raised assisting the company with its US expansion, including the process of seeking a dual listing of its securities on the main index of the NASDAQ Capital Market.
In late 2019, MyFiziq commenced discussions with US advisors and bankers on the potential to dual list the company on the US-based NASDAQ exchange.
MyFiziq held several meetings with New York-based bankers and advisors interested in participating in the opportunity.
The outcome of these meetings saw several offers presented to MyFiziq from well-established firms seeking to be engaged as the company’s exclusive underwriting advisor in relation to a NASDAQ listing.
ACAM played a significant role in the introduction to these advisors, US law firms and bankers through its extensive network in the US.
The funds management group is very supportive of this initiative and has therefore extended further funding to the company with the primary goal of advancing the NASDAQ listing.
By way of background, MyFiziq is a globally patented technology developed with a proprietary image capturing system within a smartphone that has the ability to create a representation of an individual’s structure in the form of a 3D avatar with accurate circumference measurements.
Organisations embed the technology into their new or existing applications and then customise the experience to meet their brand and functional requirements.
Accessing US capital for US expansion
Underlining the benefits of a NASDAQ listing in terms of MyFiziq’s US expansion initiatives, chief executive, Vlado Bosanac said, “I believe opening up the company to the US exchange will assist MyFiziq with its US-domiciled partners.
‘’It is often a concern to these organisations that we are not US-based when they are looking to integrate our technology into their own ecosystem and customer engagement.
‘’This move will also bring both fresh investors and support to the company.
‘’MyFiziq is at a turning point with the release of Evolt and multiple other applications under development for release in the coming months.
‘’The US investment banks we met with over the last months have showed very strong interest in our technology and the pathway we outlined to generate revenue.
‘’We had built momentum in the US prior to the COVID-19 shutdowns, which caused an initial stall in our ambitions.
‘’In the past weeks, this interest has re-ignited and with this we accepted the initial funding from ACAM to execute on our plans.”
The sheer population of the US gives MyFiziq access to thousands of companies that could benefit from using its technology, health, gyms, insurers and apparel companies.
ACAM to be issued shares on NASDAQ listing
Funding will occur in four tranches with a mandatory conversion upon a successful NASDAQ listing.
On conversion, ACAM will be issued shares in the NASDAQ listed company at the greater of US$1.00 and a 25% discount to the price at which the company issues shares in conjunction with the listing.
ACAM will accrue interest on the funds advanced to the company at a rate of 10% per annum, with interest being capitalised and also converted at the time of listing on the NASDAQ.
In the event MyFiziq is not successful in attaining a listing on the NASDAQ on or prior to 30 June 2021, the company will have an additional 6 months to repay the capital.
The company can access US$225,000 within the next fortnight.
Within 30 days of an approved audit, MyFiziq will have access to US$450,000 in funds, accounting for the first two tranches.
Within 14 days of filing a registration statement with the US Securities and Exchange Commission in relation to the NASDAQ listing, MyFiziq will be able to access US$450,000.
The remaining US$375,000 will become available after the company engages an underwriter or an investment bank to provide services in connection with the NASDAQ listing.
MyFiziq able to apply for NASDAQ Capital Market tier
The US NASDAQ exchange has 3 tiers available to organisations wishing to apply for quotation.
Under the guidance issued by NASDAQ, MyFiziq will be applying for quotation on the NASDAQ Capital Market tier.
The proposed dual listing is subject to, amongst other things, the relevant filings with the US Securities and Exchange Commission (SEC) and meeting the requirements to list on NASDAQ, of which there is no guarantee.
MyFiziq, in conjunction with the US advisors who are seeking to be appointed, is targeting the dual listing process and commencement of trading of the company’s shares on the NASDAQ to be completed between the December quarter of 2020 and the March quarter of 2021.