Aptevo Therapeutics Announces Exercise of Warrants for $6.2 Million Gross Proceeds

Rhea-AI Summary

Aptevo Therapeutics (NASDAQ:APVO) has secured agreements for the immediate exercise of existing warrants to purchase 823,544 shares of common stock at a reduced exercise price of $7.50 per share. The warrants were originally issued between August 2023 and September 2024. This exercise will generate approximately $6.2 million in gross proceeds.

In exchange, Aptevo will issue new unregistered warrants for up to 1,647,088 shares at $9.53 per share, exercisable immediately with a five-year term. The transaction, expected to close around December 13, 2024, is being facilitated by Roth Capital Partners. The company plans to use the net proceeds for working capital and general corporate purposes.

Positive

• Immediate cash injection of $6.2 million through warrant exercise
• New warrants issued at higher exercise price ($9.53 vs $7.50)
• Five-year term on new warrants provides long-term funding potential

Negative

• Potential dilution from exercise of 823,544 shares of common stock
• Additional dilution risk from new warrants covering 1,647,088 shares
• Reduced warrant exercise price indicates possible discount to market value

Insights

Financial Analyst

This warrant exercise represents a significant capital injection for Aptevo, bringing in $6.2 million in gross proceeds at a $7.50 per share exercise price. The deal structure is particularly interesting - existing warrant holders are incentivized to exercise immediately in exchange for new warrants at $9.53 per share with a 5-year term. While this provides immediate cash, the new warrants create potential future dilution with 1.64 million additional shares. Given Aptevo's micro-cap status and focus on capital-intensive immune-oncology therapeutics, this financing strengthens their working capital position but comes at the cost of increased warrant overhang. The 27% premium on the new warrants versus the exercise price suggests some optimism about future value creation.

Biotech Research Analyst

The successful warrant exercise demonstrates investor confidence in Aptevo's ADAPTIR and ADAPTIR-FLEX platforms for immune-oncology therapeutics. The immediate capital infusion will support ongoing clinical development programs, which is important for a development-stage biotech company. The fact that multiple warrant holders from different issuances (August 2023 through September 2024) participated suggests sustained interest in the company's therapeutic approach. However, the reduced exercise price indicates some pressure to secure funding, typical for clinical-stage biotechs in the current market environment.

SEATTLE, WASHINGTON / ACCESSWIRE / December 12, 2024 / Aptevo Therapeutics Inc. (NASDAQ:APVO) ("Aptevo" or the "Company"), a clinical-stage biotechnology company focused on developing novel immune-oncology therapeutics based on its proprietary ADAPTIR^® and ADAPTIR-FLEX^® platform technologies, today announced it has entered into agreements with certain holders of its existing warrants for the immediate exercise of certain outstanding warrants to purchase up to an aggregate of 823,544 shares of common stock of the Company originally issued in August 2023, in November 2023, in April 2024, in July 2024 and September 2024, all at a reduced exercise price of $7.50 per share. The shares of common stock issuable upon exercise of the outstanding warrants are registered pursuant to effective registration statements on Form S-1 (File No. 333-273067), on Form S-3 (File No. 333-275710), on Form S-1 (File No. 333-278103), on Form S-1 (File No. 333-280226) and on Form S-1 (File No. 333-281892). The aggregate gross proceeds from the exercise of the existing warrants is expected to total approximately $6.2 million, before deducting financial advisory fees.

Roth Capital Partners is acting as the Company's financial advisor for this transaction.

In consideration for the immediate exercise of the warrants for cash, the Company will issue new unregistered warrants to purchase shares of common stock. The new warrants will be exercisable for an aggregate of up to 1,647,088 shares of common stock, at an exercise price of $9.53 per share and will be immediately exercisable upon issuance and for a term of five years from the issuance date.

The offering is expected to close on or about December 13, 2024, subject to satisfaction of customary closing conditions. The Company intends to use the net proceeds from the offering for working capital and general corporate purposes.

The new warrants described above were offered in a private placement pursuant to an applicable exemption from the registration requirements of the Securities Act of 1933, as amended (the "1933 Act") and, along with the shares of common stock issuable upon their exercise, have not been registered under the 1933 Act, and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission ("SEC") or an applicable exemption from such registration requirements. The Company has agreed to file a registration statement with the SEC covering the resale of the shares of common stock issuable upon exercise of the new warrants.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or exemption under the securities laws of any such state or jurisdiction.

About Aptevo Therapeutics

Aptevo Therapeutics Inc. (Nasdaq: APVO) is a clinical-stage biotechnology company focused on developing novel bispecific immunotherapies for the treatment of cancer. The company has two clinical candidates. Mipletamig is currently being evaluated in RAINIER, a Phase 1b/2 trial for the treatment of frontline acute myeloid leukemia in combination with standard of care venetoclax + azacitidine. Mipletamig has orphan status for AML according to the Orphan Drug Act. ALG.APV-527, a bispecific conditional 4-1BB agonist that is only active upon simultaneous binding to 4-1BB and 5T4, is being co-developed with Alligator Bioscience and is being evaluated in a Phase 1 clinical trial for the treatment of multiple solid tumor types likely to express 5T4. Aptevo has three pre-clinical candidates with different mechanisms of action designed to target a range of solid tumors. All pipeline candidates were created from two proprietary platforms, ADAPTIR^® and ADAPTIR-FLEX^®. The Aptevo mission is to improve treatment outcomes and transform the lives of cancer patients. For more information, please visit www.aptevotherapeutics.com.

Forward-Looking Statement

This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, including, without limitation, statements regarding the closing of the private placement, the satisfaction of the closing conditions of the private placement, the use of net proceeds from the private placement, and any other statements containing the words "may," "continue to," "believes," "knows," "expects," "optimism," "potential," "designed," "promising," "plans," "will" and similar expressions are intended to identify forward-looking statements. These forward-looking statements are based on Aptevo's current intentions, beliefs, and expectations regarding future events. Aptevo cannot guarantee that any forward-looking statement will be accurate. Investors should realize that if underlying assumptions prove inaccurate or unknown risks or uncertainties materialize, actual results could differ materially from Aptevo's expectations. Investors are, therefore, cautioned not to place undue reliance on any forward-looking statement.

There are several important factors that could cause Aptevo's actual results to differ materially from those indicated by such forward-looking statements, including a deterioration in Aptevo's business or prospects; further assessment of preliminary or interim data or different results from later clinical trials; adverse events and unanticipated problems, adverse developments in clinical development, including unexpected safety issues observed during a clinical trial; and changes in regulatory, social, macroeconomic and political conditions. For instance, actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including but not limited to, the uncertainties inherent in the results of preliminary or interim data and preclinical studies being predictive of the results of later-stage clinical trials, initiation, enrollment and maintenance of patients, and the completion of clinical trials, the availability and timing of data from ongoing clinical trials, expectations for the timing and steps required in the regulatory review process, expectations for regulatory approvals, the impact of competitive products, our ability to enter into agreements with strategic partners or raise funds on acceptable terms or at all and other matters that could affect the availability or commercial potential of Aptevo's product candidates, business or economic disruptions due to catastrophes or other events, including natural disasters or public health crises such as the coronavirus (referred to as COVID-19), geopolitical risks, including the current war between Russia and Ukraine, war between Israel and Hamas, and macroeconomic conditions such as economic uncertainty, rising inflation and interest rates, continued market volatility and decreased consumer confidence. These risks are not exhaustive, Aptevo faces known and unknown risks. Additional risks and factors that may affect results are set forth in Aptevo's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the fiscal year ended December 31, 2023, and its subsequent reports on Form 10-Q and current reports on Form 8-K. The foregoing sets forth many, but not all, of the factors that could cause actual results to differ from Aptevo's expectations in any forward-looking statement. Any forward-looking statement speaks only as of the date of this press release, and, except as required by law, Aptevo does not assume any obligation to update any forward-looking statement to reflect new information, events, or circumstances.

Contact Information

Miriam Miller
Head, IR and Corporate Communications
millerm@apvo.com
206-859-6628

SOURCE: Aptevo Therapeutics

View the original press release on accesswire.com

FAQ

How much money will Aptevo (APVO) raise from the warrant exercise in December 2024?

Aptevo will raise approximately $6.2 million in gross proceeds from the warrant exercise before deducting financial advisory fees.

What is the exercise price of APVO's new warrants issued in December 2024?

The new warrants have an exercise price of $9.53 per share.

How many new warrants will Aptevo (APVO) issue in the December 2024 transaction?

Aptevo will issue new warrants for up to 1,647,088 shares of common stock.

What is the term length of APVO's new warrants issued in December 2024?

The new warrants will have a term of five years from the issuance date.

How does Aptevo (APVO) plan to use the proceeds from the warrant exercise?

Aptevo intends to use the net proceeds for working capital and general corporate purposes.