VitalHub Corp. (TSX-V: VHI) is pleased to announce that it has completed a non-brokered private placement of units with the former founders and management team of Aastra Technologies Limited. The Offering was completed at a price $0.16 per Unit for gross proceeds of $3.3 million and a total of 20,625,000 Units issued.

The Investors are comprised of Aastra Technologies Limited founder, former Chairman and co-CEO Francis Shen; Aastra former President, co-CEO and COO Tony Shen; former Aastra CFO and current CFO of The Descartes Systems Group Inc., Allan Brett; and former Aastra General Counsel and current VP – M&A and General Counsel of Sangoma Technologies Corp., John Tobia. Francis Shen and Tony Shen invested by way of holding companies, Connection 25 Inc. and TMWE Inc., respectively (together, the “Principal Investors”).

Aastra was established in 1983 by Francis Shen and a partner, and was joined by Francis’s brother Tony Shen in the late 1980’s. Aastra initially serviced the aerospace and defense market, and quickly transitioned in the early 1990s to the rapidly growing telecom industry. Together, the Shen brothers quickly expanded Aastra through new product innovation, and later successfully employed an aggressive M&A consolidation strategy and global market expansion. They quickly grew the company to over 2,000 employees and more than $700 million in annual revenue. Aastra was listed on the Toronto Stock Exchange from 2000 until 2014, when it was acquired by Mitel Networks Corporation in a transaction that returned over $500 million to its shareholders. In addition, in prior years, Aastra returned over $200 million in dividends and stock buybacks.

Francis Shen will be joining the Company’s Board of Directors, and Tony Shen will serve as a Board Observer. The Company will also constitute a new committee of the Board to consider M&A strategy and initiatives, which Francis Shen will be chairing. The M&A committee will work with a non-Board advisory group that will include the Investors, VitalHub CEO Dan Matlow, and VitalHub CFO Brian Goffenberg. The Company has also agreed to an additional board nominee for Francis Shen should all of the Two-Year Warrants be exercised in full.

Use of proceeds from the Offering will be for acquisition purposes only, to advance the Company’s M&A strategy.

“M&A is an integral part of our growth and business plan,” said Dan Matlow, CEO of VitalHub. “It is very exciting to have a group of experienced technology executives invest in and endorse our vision and team. We are looking forward to working closely with them as we continue to execute on our strategy.”

“We have had the opportunity to examine and review VitalHub’s business, and we strongly believe in their approach and the opportunity that exists to bring the Company to scale,” said Francis Shen, founder, and former Chairman and co-CEO of Aastra Technologies Limited. “We believe we can assist and add value in growing the Company to become something special for all shareholders.”

Each Unit consists of one common share of the Company, one half of one common share purchase warrant with each such Two-Year Warrant being exercisable for one Common Share of the Company at an exercise price of $0.29, for a period of 24 months from the date of issuance, and one half of one common share purchase warrant with each such Three-Year Warrant being exercisable for one Common Share of the Company at an exercise price of $0.39 for a period of 36 months from the date of issuance.

Pursuant to the Offering, the Company issued a total of 20,625,000 Common Shares, 10,312,500 Two-Year Warrants and 10,312,500 Three-Year Warrants. Connection 25 Inc. and TMWE Inc. purchased, 12,812,500 and 6,250,000 Units respectively. Connection 25 Inc. now holds 8.27% of the total Common Shares of the Company (undiluted), and 15.28% of the Company (fully-diluted). TMWE Inc. now holds 4.03% of the total Common Shares of the Company (undiluted), and 7.76% of the Company (fully-diluted). Because of this, the Principal Investors and the Company have agreed to treat the Principal Investors as acting jointly and have added terms to the subscription agreements and Warrants held thereby which prevent the Principal Investors from exercising that number of Warrants such that their aggregate total Common Shares held would be equal to or greater than 20% of the total issued and outstanding Common Shares of the Company. In addition, the Company has agreed that 367,907 Warrants, being that number of Warrants which, if exercised, would result in the Principal Shareholders holding greater than 19.99% of the total issued and outstanding Common Shares of the Company, shall be subject to cashless exercise provisions in the event that the Principal Investors wish to exercise such Warrants but are otherwise unable, the Company will exchange the Warrants for cash payment equal to the difference of the closing price of the Company’s Common Shares on the date prior to the notice of exercise delivered to the Company by the Principal Investor and the exercise price of the subject Warrant.

All securities issued in connection with the Offering are subject to a four month hold period expiring May 20, 2019.

About VitalHub:

VitalHub develops and supports mission-critical information systems in the Social Service, Mental Health (Child, Youth and Adult), Long Term Care, Community Health Service, Home Health and Hospital sectors. VitalHub technologies include Blockchain, Mobile, and Web-Based Assessment, Client Management and Electronic Health Record solutions.

The Company has a robust two-pronged growth strategy, targeting organic growth opportunities within its product suite, and pursuing an aggressive M&A plan. Currently, VitalHub serves 200+ clients across North America. VitalHub is based in Toronto, Canada, with an offshore innovation hub in Sri Lanka.