Aspire Biopharma Holdings, Inc. Announces the Execution of Securities Purchase Agreement

Rhea-AI Summary

Aspire Biopharma (Nasdaq: ASBP) has entered into a Securities Purchase Agreement on February 19, 2025, issuing a senior secured convertible debenture that will generate $3.0 million in gross proceeds. The debenture is convertible only in case of default or at the company's discretion.

The transaction, expected to close on February 20, 2025, includes investor volume restrictions limiting sales to 15% of daily volume. The proceeds will support general working capital and operating expenses. Notably, the structure avoids warrants or resets typically associated with DESPAC transactions.

Dawson James Securities and RBW Capital Partners are serving as exclusive placement agents, with ArentFox Schiff LLP and Sichenzia Ross Ference Carmel LLP providing legal counsel to the placement agent and company respectively.

Positive

• Secured $3.0 million in gross proceeds to support working capital
• Investor volume restrictions limit selling to 15% of daily volume, reducing potential stock pressure
• Debenture structure avoids dilutive warrants and resets

Negative

• Additional debt burden through convertible debenture
• Potential dilution risk if default occurs or company opts for conversion

Insights

Financial Analyst

The $3 million convertible debenture financing represents a strategically structured capital raise that prioritizes existing shareholder interests while addressing immediate working capital needs. Several key aspects of this deal structure warrant attention:

The financing's protective features are particularly noteworthy:

• The conversion option is restricted to default scenarios or company discretion, providing stronger protection against dilution compared to standard convertible notes
• The absence of warrants and price resets typically seen in SPAC-related transactions suggests management's confidence in maintaining share value
• The 15% daily volume restriction on investor sales helps prevent sudden selling pressure and market disruption

The involvement of Dawson James Securities as placement agent, along with their RBW Capital Partners division, adds institutional credibility to the transaction. This type of financing structure, while modest in size, indicates management's focus on maintaining a clean capital structure while securing necessary working capital. The terms suggest a balanced approach between immediate funding needs and long-term shareholder value preservation.

However, investors should note that the $3 million raise represents a relatively modest capital injection, primarily targeted at general working capital and operating expenses rather than specific growth initiatives. This could indicate either conservative cash management or potential need for additional future financing rounds, depending on the company's burn rate and development timeline for their drug delivery technology platform.

NEW YORK CITY, NY / ACCESS Newswire / February 20, 2025 / Aspire Biopharma, Inc. ("Aspire" or the "Company"), a developer of a multi-faceted patent-protected disruptive drug delivery mechanism technology (Nasdaq:ASBP)(Nasdaq:ASBPW), today announced that it entered into a definitive Securities Purchase Agreement (the "Agreement") on February 19, 2025, pursuant to which the Company issued to the Buyers a senior secured convertible debenture (the "Debenture"). The Debenture is only convertible in the event of a default or at the Company's discretion. The closing of the transaction is expected to occur on February 20, 2025 (the "Closing Date"). The transaction will result in gross proceeds to the Company of $3.0 million. Proceeds from the transaction will support the Company's general working capital and operating expenses.

Kraig Higginson, Chief Executive Officer of Aspire, commented, "This senior secured convertible debenture was structured to avoid any inclusion of warrants or resets often associated with DESPAC transactions. In addition, the investors in the debenture transaction, have agreed to a volume restriction prohibiting each of them from selling more than 15% of the daily volume. We are pleased to have concluded this transaction which strengthens the Company's capital structure and improves its near- term liquidity position, enhancing our ability to continue the development of innovative and improved formulations of approved FDA drugs and nutraceuticals while maximizing long term shareholder value."

Dawson James Securities, Inc. and RBW Capital Partners LLC, a division of Dawson James Securities, Inc. (the "Placement Agent") are acting as exclusive placement agents for the offering.

ArentFox Schiff LLP acted as legal counsel to the Placement Agent and Sichenzia Ross Ference Carmel LLP is acted as legal counsel to the Company.

About Aspire Biopharma, Inc.

Headquartered in Humacao, Puerto Rico, Aspire Biopharma has developed a disruptive technology through a Novel Soluble Formulation which addresses emergencies, drug efficacy, dosage management, and response time. For more information, please visit www.aspirebiolabs.com.

Safe Harbor Statement

Certain statements made in this communication are "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may generally be identified by the use of words such as "estimate," "projects," "expects," "anticipates," "forecasts," "plans," "intends," "believes," "seeks," "may," "will," "would," "should," "future," "propose," "potential," "target," "goal," "objective," "outlook" and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the control of the parties, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Information concerning factors that could cause Aspire's actual results to differ materially from those contained in these forward-looking statements can be found in the Company's Annual Report on Form 10-K, subsequent quarterly reports on Form 10-Q and initial public offering prospectus. The Company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law.

Aspire Biopharma, Inc. Contact

TraDigital IR
Kevin McGrath
+1-646-418-7002
kevin@tradigitalir.com

SOURCE: Aspire Biopharma, Inc.

View the original press release on ACCESS Newswire

FAQ

How much funding did Aspire Biopharma (ASBP) raise in the February 2025 debenture offering?

Aspire Biopharma raised $3.0 million in gross proceeds through a senior secured convertible debenture offering on February 19, 2025.

What are the conversion terms for ASBP's February 2025 convertible debenture?

The debenture is only convertible in the event of a default or at the Company's discretion.

What trading restrictions apply to ASBP's February 2025 debenture investors?

Investors are restricted to selling no more than 15% of the daily trading volume.

How will Aspire Biopharma (ASBP) use the proceeds from the February 2025 debenture?

The proceeds will be used to support the Company's general working capital and operating expenses.

Who are the placement agents for ASBP's February 2025 debenture offering?

Dawson James Securities, Inc. and RBW Capital Partners (a division of Dawson James Securities) are acting as exclusive placement agents.