Jeffs’ Brands: Fort Technology Announces Closing of a CAD 5 Million Private Placement of Convertible Debenture Representing a Valuation of Approximately CAD 27 million

Rhea-AI Summary

Jeffs' Brands (NASDAQ:JFBR) announced that its 75.02%-owned subsidiary, Fort Technology (TSXV:FORT), has completed a CAD 5 million private placement of convertible debentures. The debentures, maturing in two years, carry a 10% annual interest rate payable quarterly and are convertible into units at CAD 0.185 per unit.

Each unit consists of one common share and a five-year warrant to purchase an additional share at CAD 0.185. The placement values Fort at approximately CAD 27 million. Notably, Jeffs' Brands invested CAD 2.2 million in the placement, with proceeds intended for working capital and loan extension purposes.

Positive

• Secured CAD 5 million in financing through convertible debentures
• Represents a significant valuation of CAD 27 million for Fort Technology
• Company demonstrates confidence by investing CAD 2.2 million in the placement
• Favorable 5-year warrant terms provide potential upside for investors

Negative

• 10% annual interest rate indicates relatively high cost of capital
• Potential dilution for existing shareholders upon conversion
• Related-party transaction may raise governance concerns

Insights

Financial Analyst

Fort Technology secured CAD 5M through convertible debentures at CAD 27M valuation, with Jeffs' Brands investing CAD 2.2M in its 75.02%-owned subsidiary.

Fort Technology has successfully closed a CAD 5 million private placement of convertible debentures, reflecting a valuation of approximately CAD 27 million for the company. This financing structure offers interesting terms for investors with a 10% annual interest rate payable quarterly and a two-year maturity timeline. The conversion option allows holders to transform their debt into equity units at CAD 0.185 per unit, with each unit comprising one common share and one five-year warrant at the same strike price.

What's particularly notable is Jeffs' Brands' significant participation in this fundraising round, contributing CAD 2.2 million or 44% of the total placement. This substantial investment demonstrates Jeffs' Brands' continued commitment to Fort Technology, in which it already holds a controlling 75.02% stake. The transaction structure—allowing debt conversion to equity—provides flexibility while the interest payments help manage immediate cash flow impacts.

The deal required special approval due to related-party transaction rules, given that both Jeffs' Brands and its CEO participated in the placement. Fort Technology plans to use these funds for working capital and to extend a previously disclosed loan, suggesting the company is focused on operational liquidity rather than specific growth initiatives. This financing gives Fort Technology runway to execute its business strategy while maintaining its valuation position in the market.

Tel Aviv, Israel, Aug. 22, 2025 (GLOBE NEWSWIRE) -- Jeffs' Brands Ltd (“Jeffs’ Brands” or the “Company”) (Nasdaq: JFBR, JFBRW), a data-driven e-commerce company operating on the Amazon Marketplace, today announced that Fort Technology Inc. (“Fort”) (TSXV: FORT), a TSX Venture Exchange-listed company in which Jeffs’ Brands holds 75.02%, has closed its previously announced private placement of convertible debentures (the “Convertible Debentures”) for gross proceeds of CAD 5 million (the “Private Placement”).

The Convertible Debentures will mature on the date that is two years from the date of issuance (the “Maturity Date”) and bear interest at a rate of 10% per annum, payable quarterly, with the first payment covering the period from closing of the Private Placement to September 30, 2025. At the option of the holder, the principal amount of the Convertible Debentures is convertible into units of Fort (“Units”) of Fort at any time from the date of issuance until the Maturity Date at a price equal to CAD 0.185 per Unit. Each Unit will consist of one common share of Fort (each, a “Common Share”) and one warrant (each, a “Warrant”) to purchase one Common Share (each, a “Warrant Share”) at an exercise price of CAD 0.185 per Warrant Share. Each Warrant will be exercisable for a period of five (5) years from the date of issuance of the Convertible Debentures. The Private Placement represents a valuation of approximately CAD 27 million for Fort.

The Private Placement was conducted by Fort in reliance upon certain prospectus exemptions. The Convertible Debentures, and the securities issuable upon conversion of the Convertible Debentures, will be subject to a holding period in compliance with applicable securities laws and TSX Venture Exchange rules.

Each of the Company and the Company’s Chief Executive Officer participated in the Private Placement, with the Company purchasing Convertible Debentures for CAD 2.2 million. As such, the Private Placement constitutes a related-party transaction under applicable TSX Venture Exchange policies and the Israeli Companies Law, 1999, and it was approved by each of the Company and Fort in accordance with applicable law. and procedures.

The net proceeds from the Private Placement will be used by Fort for general working capital purposes and to support the extension of a loan under a previously disclosed loan agreement.

About Jeffs’ Brands

Jeffs’ Brands aims to transform the world of e-commerce by creating and acquiring products and turning them into market leaders, tapping into vast, unrealized growth potential. Through the Company’s management team’s insight into the FBA Amazon business model, it aims to use both human capability and advanced technology to take products to the next level. For more information on Jeffs’ Brands visit https://jeffsbrands.com.

About Fort Technology

Fort Technology Inc. operates a business as an established manufacturer and seller specializing in a range of amateur and professional products for the pest control and remedial repair industry.

Forward-Looking Statement Disclaimer

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are intended to be covered by the “safe harbor” created by those sections. Forward-looking statements, which are based on certain assumptions and describe the Company’s future plans, strategies and expectations, can generally be identified by the use of forward-looking terms such as “believe,” “expect,” “may,” “should,” “could,” “seek,” “intend,” “plan,” “goal,” “estimate,” “anticipate” or other comparable terms. For example, the Company is using forward-looking statements when discussing the applicable holding period requirements for the Convertible Debentures and related securities and the anticipated use of proceeds of the Private Placement by Fort. Instead, they are based only on the Company’s current beliefs, expectations and assumptions regarding the future of the Company’s business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of the Company’s control. The Company’s actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause the Company’s actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: the Company’s ability to adapt to significant future alterations in Amazon’s policies; the Company’s ability to sell its existing products and grow the Company’s brands and product offerings; the Company’s ability to meet its expectations regarding the revenue growth and the demand for e-commerce; the overall global economic environment; the impact of competition and new e-commerce technologies; general market, political and economic conditions in the countries in which the Company operates; projected capital expenditures and liquidity; the impact of possible changes in Amazon’s policies and terms of use; the impact of the conditions in Israel; and the other risks and uncertainties described in the Company’s Annual Report on Form 20-F for the year ended December 31, 2024, filed with the U.S. Securities and Exchange Commission (“SEC”), on March 31, 2025, and the Company’s other filings with the SEC. The Company undertakes no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

Investor Relations Contact:

Michal Efraty
Adi and Michal PR- IR
Investor Relations, Israel
michal@efraty.com

FAQ

What are the terms of Jeffs' Brands (JFBR) Fort Technology convertible debenture placement?

The CAD 5 million convertible debentures have a 2-year maturity, 10% annual interest rate payable quarterly, and are convertible at CAD 0.185 per unit, with each unit including a share and a 5-year warrant.

How much did Jeffs' Brands invest in Fort Technology's private placement?

Jeffs' Brands invested CAD 2.2 million in the convertible debenture private placement of its 75.02%-owned subsidiary Fort Technology.

What is the valuation of Fort Technology based on the August 2025 private placement?

The private placement represents a valuation of approximately CAD 27 million for Fort Technology.

How will Fort Technology use the proceeds from the CAD 5 million private placement?

The net proceeds will be used for general working capital purposes and to support the extension of a loan under a previously disclosed loan agreement.

What is the conversion price and warrant terms for Fort Technology's convertible debentures?

The debentures are convertible at CAD 0.185 per unit, with each unit including one common share and a warrant exercisable at CAD 0.185 for 5 years.