Actelis Announces Exercise of Warrants for $3 Million Gross Proceeds
Actelis Networks (NASDAQ:ASNS) has entered a definitive agreement for the immediate exercise of certain outstanding warrants, generating approximately $3 million in gross proceeds. These warrants, initially issued in May and September 2023, have an exercise price of $2.75 per share. H.C. Wainwright & Co. is acting as the exclusive placement agent for this offering, which is expected to close around June 6, 2024, subject to customary conditions. The proceeds will be used for general corporate purposes. Additionally, the company will issue new Series A-1 and A-2 unregistered warrants, each allowing the purchase of up to 999,670 shares at $2.00 per share, with terms of five and one-half years and twenty-four months, respectively.
- Actelis will raise approximately $3 million in gross proceeds from the exercise of warrants.
- The funds will be used for working capital and general corporate purposes, potentially enhancing operational flexibility.
- Issuance of new Series A-1 and A-2 warrants at a lower exercise price of $2.00 per share might attract further investment.
- The issuance of new warrants could lead to potential shareholder dilution.
- Placement agent fees and offering expenses will reduce the net proceeds from the exercise of warrants.
- The market may react negatively to the issuance of unregistered warrants and the necessity for further SEC registration.
Insights
The immediate exercise of warrants resulting in
Short-term Implications: This exercise is beneficial as it provides immediate working capital without resorting to more dilutive equity raises or debt financing. On the flip side, there will be placement agent fees and offering expenses that will reduce the net proceeds available for the company.
Long-term Implications: While the infusion strengthens the balance sheet temporarily, the issuance of new warrants means future dilution is on the horizon, especially if the stock price appreciates and the warrants are exercised. This creates a potential overhang on the stock's price appreciation in the future.
The strategic issuance of new warrants, structured as Series A-1 and Series A-2, with varying terms and immediate exercisability, indicates an effort to provide flexible options to different investor profiles. The Series A-1 warrants have a longer term of five and a half years, while Series A-2 warrants have a shorter term of twenty-four months, catering to both long-term and short-term investment strategies. This differentiated structure might help attract a broader range of investors, potentially stabilizing the company's stock price by providing a perceived support level at
However, one should note the potential market perception of a
Overall, these moves can be viewed as a double-edged sword: while it ensures immediate capital inflow, it also sets a cap on future stock price appreciation due to potential dilution.
FREMONT, Calif., June 05, 2024 (GLOBE NEWSWIRE) -- Actelis Networks, Inc. (NASDAQ:ASNS) (“Actelis” or the “Company”), a market leader in cyber-hardened, rapid deployment networking solutions for IoT applications, today announced the entry into a definitive agreement for the immediate exercise of certain outstanding warrants to purchase up to an aggregate of 999,670 shares of common stock of the Company originally issued in May 2023 and September 2023 having an exercise price of
H.C. Wainwright & Co. is acting as the exclusive placement agent for the offering.
In consideration for the immediate exercise of the warrants for cash and the payment of additional
The offering is expected to close on or about June 6, 2024, subject to satisfaction of customary closing conditions. The Company intends to use the net proceeds from the offering as working capital for 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 qualification under the securities laws of any such state or jurisdiction.
About Actelis Networks, Inc.
Actelis Networks, Inc. (NASDAQ: ASNS) is a market leader in cyber-hardened, rapid-deployment networking solutions for wide-area IoT applications including federal, state and local government, ITS, military, utility, rail, telecom and campus applications. Actelis’ unique portfolio of hybrid fiber, environmentally hardened aggregation switches, high density Ethernet devices, advanced management software and cyber-protection capabilities, unlocks the hidden value of essential networks, delivering safer connectivity for rapid, cost-effective deployment. For more information, please visit www.actelis.com.
Forward-Looking Statements
This press release contains certain forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are identified by the use of the words "could," "believe," "anticipate," "intend," "estimate," "expect," "may," "continue," "predict," "potential," "project" and similar expressions that are intended to identify forward-looking statements, and include statements regarding the completion of the offering, satisfaction of the closing conditions and use of proceeds therefrom. All forward-looking statements speak only as of the date of this press release. You should not place undue reliance on these forward-looking statements. Although we believe that our plans, objectives, expectations and intentions reflected in or suggested by the forward-looking statements are reasonable, we can give no assurance that these plans, objectives, expectations or intentions will be achieved. Forward-looking statements involve significant risks and uncertainties (some of which are beyond our control), including, but not limited to, market and other conditions, and assumptions that could cause actual results to differ materially from historical experience and present expectations or projections. Actual results could differ materially from those in the forward-looking statements and the trading price for our common stock may fluctuate significantly. Forward-looking statements also are affected by the risk factors described in the Company's filings with the U.S. Securities and Exchange Commission. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.
Media Contact:
Sean Renn
Global VP Marketing & Communications
srenn@actelis.com
Investor Relations Contact:
Kirin Smith
PCG Advisory, Inc.
Ksmith@pcgadvisory.com
FAQ
What is the gross amount Actelis Networks expects to raise from the warrant exercise?
When is the closing date for the Actelis warrant exercise agreement?
What will Actelis Networks use the proceeds from the warrant exercise for?
What exercise price is set for the new Series A-1 and A-2 warrants issued by Actelis?
Who is the placement agent for Actelis Networks' warrant exercise offering?
How many shares can be purchased with the new Series A-1 and A-2 warrants?
