BRTL Brattle Street Investment Corp

Brattle Street Investment Corp. (the “Company”) (TSXV:BRTL) announced today that it will post its fiscal third quarter financial statements on Friday, October 30, 2020. Cash remained steady at US$6.518 million, as compared to US$6.572 million for the prior quarter. As of October 20, 2020, cash stood at US$6.526 million (see table below).

The Company also provided an update today on its acquisition pipeline and previously announced proposed concurrent financing. Advancements in negotiations with several targets in the acquisition pipeline have actually reduced the requirement for additional equity capital, which in turn, has provided an opportunity for the Company to improve its concurrent financing plans as it moves toward re-listing on the TSX Venture Exchange (the “Exchange”).

The Company announced on September 17, 2020 it will seek shareholder approval for a transformational acquisition and a change of business (the “Transaction”) to focus on the medical device market with an emphasis on acquiring and expanding already existing products in the orthopedic industry.

“It is clear that our structure, business plan and management team is very attractive to the accretive acquisition targets as well as US investors,” said Les Cross, Chairman of the Board. “As a result, the most attractive medical device targets, usually owned by institutional or sophisticated investors, prefer common shares over a cash payout, and are willing to accept structures that support a longer term investment as they look to benefit from our post acquisition growth plan. I have also been in touch with several institutions in the US as we prepare for an eventual US listing.”

The vast majority of the potential targets have expressed interest in a similar structure to the proposed Transaction, which provides for payment primarily in stock and shares that have a lock up period for 12 months or more after closing. Additionally, discussions are most advanced with targets that are cash flow positive, which will enhance the ability of the Company to borrow for additional capital needs.

As a result of the lower immediate cash needs of the Company, the Board has re-evaluated and improved the structure of the planned financing.

To improve the capital structure at listing, the Company has revised the equity financing to result in a lower initial issuance of tradeable shares, and instead provide several layers of equity issuances at differing prices with varying levels of liquidity. With this structure, unrestricted shares available for trade at re-listing are reduced significantly. The Company will also be filing with the U.S. Securities Exchange Commission an S-1 Registration Statement, which is a major prerequisite to a future listing on a United States exchange.

In the proposed concurrent financing (described in detail below), the Company will issue only up to 12 million shares (8,844,000 post-Consolidation (defined below)‎).

“In short, we are able to place stock with acquisition targets at high prices with longer lock ups reducing our need for cash and our reliance of the capital market for financing,” continued Mr. Cross. “On top of all of that, these targets generate cash flow that we may choose to leverage if we need cash. This puts us in a great position to optimize our capital structure and design a capital plan that benefits both existing shareholders, new shareholders and our incoming long term shareholders from an acquisition. Everyone wins with a tighter float and I am pleased that we are in a position to offer that to our shareholders.”

The Consolidation (as such term is defined in the Company’s September 17, 2020 News Release) and change of name to Salona Global Medical Device Corporation ‎is proposed to be completed prior to closing of the offerings.

Details of the Offerings

Up to 9,000,000 common shares (6,633,000 post-Consolidation‎) priced at $0.35 (pre-Consolidation) or $0.47 (post-Consolidation), with 20% of the shares initially free trading upon closing of the Transaction and an additional 20% becoming unrestricted each month thereafter pursuant to the policies of the Exchange. The offering will be completed by the Company by way of a non-brokered private placement of subscription receipts at a price of $0.35 per subscription receipt ($0.47 post-Consolidation), for gross proceeds of up to $3,150,000. Each subscription receipt will automatically convert into one common share of the Company on ‎the date (the “Release Date”) that is the later of (i) the satisfaction or waiver of all conditions ‎precedent to the Transaction, and (ii) the date on which ‎the United States Securities and Exchange Commission declares a Form S-1 ‎Registration Statement of the Company effective, and ‎certain other ‎‎ancillary ‎conditions without any further consideration on the part of the ‎‎subscriber‎. In connection with the offering, registered dealers will be entitled to (i) cash compensation equal to 5% of the gross proceeds of the offering (50% payable on closing of the offering and 50% payable upon ‎satisfaction of the release conditions), and (ii) non-transferable compensation options to purchase that number of common shares equal to 12.5% of the number of subscription receipts (subject to the Consolidation) issued under the offering at a price of ‎$0.35 ($0.47 post-Consolidation) per share for a period of 24 months from the closing of the offering and issuable upon ‎satisfaction of the release conditions‎.‎ The subscription receipts will be issued as ‎‎“restricted securities” (as defined in Rule 144 under the U.S. Securities ‎Act). All securities issuable under the offering will be subject to a four month hold period and are expected to be subject to seed share resale restrictions of the Exchange equal to ‎‎20% of the shares initially free trading upon closing ‎of the Transaction and an additional 20% becoming ‎unrestricted each month thereafter.

Up to 3,000,000 units (2,211,000 post-Consolidation‎) ‎priced at $0.63 (pre-Consolidation) or $0.85 (post-Consolidation), with 100% of the securities being freely tradeable upon closing of the Transaction. The offering will be completed by a British Columbia ‎incorporated company wholly-owned by the Company (“Finco”) by way of a non-brokered private placement of subscription receipts at a price of $0.63 per subscription receipt ($0.85 post-Consolidation), for gross proceeds of up to $1,890,000. Each subscription receipt will automatically convert into one unit of Finco on ‎the Release Date. ‎Each post-Consolidation unit shall consist of one common share of the Finco and one common ‎share purchase warrant, with each warrant exercisable for one common share at $0.92 ($1.25 post-Consolidation) per ‎share for 24 months from the closing of the offering, subject ‎to acceleration if, at any ‎time following the date ‎that is the later of (a) four months and one day from closing of the offering, and (b) closing of the Transaction, the volume-‎weighted average trading ‎price of the common shares of the Company is greater ‎than $1.10 ($1.49 post-Consolidation) for 20 consecutive trading days, at ‎‎which ‎time the Company may, within five business days, accelerate the expiry date of the warrants by issuing a News Release disclosing the reduced warrant term ‎whereupon the ‎warrants will expire on the 20th calendar day after the ‎date of such News Release. Each common share and warrant of Finco underlying the units will then be exchanged for ‎one common share and one warrant of the Company, as applicable, with substantially ‎the ‎same terms, in connection with the Transaction. ‎In connection with the offering, registered dealers will be entitled to (i) cash compensation equal to 5% of the gross proceeds of the offering (50% payable on closing of the offering and 50% payable upon ‎satisfaction of the release conditions), and (ii) non-transferable compensation options to purchase that number of common shares equal to 12.5% of the number of subscription receipts (subject to the Consolidation) issued under the offering at a price of ‎$‎0.63 ($0.85 post-Consolidation) per share for a period of 24 months from the closing of the offering and issuable upon ‎satisfaction of the release conditions‎.‎ As a private company, the securities issuable by Finco will be subject to an indefinite four month hold ‎period however the Transaction will be structured so that securities issuable by the Company to the ‎holders of Finco securities will be freely tradeable upon closing of the Transaction.‎

Resale restrictions are subject to final Exchange confirmation and acceptance at the time of the final approval of the Transaction.

Closing of the offerings are subject to approval of the Exchange and completion of the Transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable, disinterested shareholder approval. Where applicable, the Transaction cannot close until the required shareholder approval is obtained.

Details of Fiscal Third Quarter Financial Statements

The Company’s combined cash and marketable securities holdings at the end of Q1 and Q2 2021 as well as at October 20, 2020 were as follows:

	Total in USD	Total in CAD*
Balance at 10/20/20‎	$6,526,392‎	$8,574,373‎
Balance at 8/31/20‎	‎$6,518,496‎	‎$8,501,422‎
Balance at 5/31/20‎	‎$6,572,262‎	‎$9,061,178‎

*Based on the Bank of Canada exchange rate on such date.

Substantial changes in the exchange rate between the United States Dollar and the Canadian Dollar had an impact on the cash balance as translated into Canadian dollars in the Company’s financial statements for the period ending August 31, 2020. The Company holds all of its cash and cash equivalents in US dollars. All acquisitions are planned in US dollars and all acquisition targets operate primarily in the US in US dollars.

The Company’s financial statements for the periods ending August 31, 2020 and August 31, 2019 and accompanying Management’s Discussion & Analysis (MD&A), will be filed on SEDAR October 30th, 2020 and will be available at www.sedar.com.

For more information please contact:

Les CrossChairman of the Board and interim Chief Executive OfficerTel: 1 (800) 760-6826Email: Info@Salonaglobal.com

There can be no assurance that the Transaction will be completed as proposed or at all. The certain financial data contained herein is unaudited and may be subject to refinement or modification during the audit process. Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of the Company should be considered highly speculative.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed Transaction and has neither approved nor disapproved the contents of this news release.

The securities referred to in this news release have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons absent U.S. registration or an applicable exemption from the U.S. registration requirements. This news release does not constitute an offer for sale of securities for sale, nor a solicitation for offers to buy any securities. Any public offering of securities in the United States must be made by means of a prospectus containing detailed information about the company and management, as well as financial statements.

Unless otherwise specified, all dollar amounts in this press release are expressed in Canadian dollars.

Neither TSXV nor its Regulation Services Provider (as that term is defined in the policies of the Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward-Looking Information

Although the Company believes, in light of the experience of its officers and directors, current conditions and expected future developments and other factors that have been considered appropriate that the expectations reflected in this forward-looking information are reasonable, undue reliance should not be placed on them because the Company can give no assurance that they will prove to be correct. When used in this press release, the words “estimate”, “project”, “belief”, “anticipate”, “intend”, “expect”, “plan”, “predict”, “may” or “should” and the negative of these words or such variations thereon or comparable terminology are intended to identify forward-looking statements and information. The forward-looking statements and information in this press release include: closing of the Transaction; receipt of Exchange approval; closing of the offerings; and the Company’s acquisition pipeline and plans. Such statements and information reflect the current view of the Company. Risks and uncertainties may cause actual results to differ materially from those contemplated in those forward-looking statements and information. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following risks: (i) there is no assurance that the Company will obtain all requisite approvals for the Transaction, including the approval of the Exchange for the Transaction (which may be conditional upon amendments to the terms of the Transaction); (ii) there is no assurance that the offerings will be completed as contemplated or at all; (iii) following completion of the Transaction, the Company may require additional financing from time to time in order to continue its operations and financing may not be available when needed or on terms and conditions acceptable to the Company; (iv) new laws or regulations could adversely affect the Company’s business and results ‎of operations; and (v) the stock markets have experienced volatility that often has been unrelated to ‎the performance of companies. These fluctuations may adversely affect the price of the Company’s securities, regardless of its operating performance. There are a number of important factors that could cause the Company’s actual results to differ materially from those indicated or implied by forward-looking statements and information. Such factors include, among others: currency fluctuations; disruptions or changes in the credit or security markets; results of operation activities and development of projects; project cost overruns or unanticipated costs and expenses, and general market and industry conditions and risks related to COVID-19 including various recommendations, orders and measures of governmental authorities to try to limit the pandemic, including travel restrictions, border closures, non-essential business closures, quarantines, self-isolations, shelters-in-place and social distancing, disruptions to markets, economic activity, financing, supply chains and sales channels, and a deterioration of general economic conditions including a possible national or global recession. The terms and conditions of the Transaction may be based on the Company’s due diligence and the receipt of tax, corporate and securities law advice for both the Company. The Company undertakes no obligation to comment on analyses, expectations or statements made by third parties in respect of the Company, its securities, or its financial or operating results (as applicable). The Company cautions that the foregoing list of material factors is not exhaustive. When relying on the Company’s forward-looking statements and information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. The Company has assumed that the material factors referred to in the previous paragraph will not cause such forward-looking statements and information to differ materially from actual results or events. However, the list of these factors is not exhaustive and is subject to change and there can be no assurance that such assumptions will reflect the actual outcome of such items or factors. The forward-looking information contained in this press release represents the expectations of the Company as of the date of this press release and, accordingly, is subject to change after such date. Readers should not place undue importance on forward-looking information and should not rely upon this information as of any other date. The Company does not undertake to update this information at any particular time except as required in accordance with applicable laws.