Actelis Networks Announces Closing of $1.5 Million Private Placement Priced At-The-Market Under Nasdaq Rules
- None.
- None.
Insights
The completion of Actelis Networks' private placement represents a strategic move to bolster the company's financial position. The capital injection of approximately $1.5 million, through the sale of over 1.2 million shares and corresponding warrants, is aimed at enhancing the company's working capital and supporting general corporate functions. This decision reflects a proactive approach to financial management, particularly for a company operating in the competitive IoT networking solutions space.
From an investment perspective, the pricing of the shares and warrants at $1.18, which aligns with Nasdaq's at-the-market rules, is a critical point of analysis. It indicates a potential dilution effect for existing shareholders, as the issuance of new shares typically results in the reduction of earnings per share. However, the additional capital can also pave the way for growth and operational stability, which may, in the long run, offset the dilutive impact.
The warrants' five-and-a-half-year expiration term and the condition that they can only be exercised upon shareholder approval suggest a long-term strategic plan by Actelis. Investors should note that the exercise of the warrants is contingent upon future market conditions and the company's performance, with no guarantee that they will be converted into shares.
Furthermore, the amendment of previously issued warrants to a lower exercise price of $1.18 per share from $2.75 per share is a significant development. This move could be interpreted as an adjustment to market realities and a potential incentive for warrant holders to invest additional capital into the company if they perceive future growth prospects to be strong.
It is also essential to recognize the role of H.C. Wainwright & Co. as the exclusive placement agent, which typically involves the selection of investors and negotiation of terms, reflecting confidence in the company's value proposition by a reputable financial firm.
The private placement's success and subsequent registration of securities for resale under the SEC guidelines will be an important milestone for Actelis Networks. It will enhance liquidity options for investors and could potentially increase the attractiveness of the company's stock in the public markets.
The offering of securities through a private placement under Section 4(a)(2) of the Securities Act and Regulation D is a common strategy for companies seeking to raise capital without the public scrutiny and regulatory requirements of a public offering. Actelis Networks' decision to utilize this exemption indicates a targeted approach to fundraising, likely aiming to involve select investors who are familiar with the company's market and growth potential.
The agreement to file an initial registration statement with the SEC for the resale of the securities within a specified timeframe underscores the company's commitment to regulatory compliance and transparency. This action facilitates the eventual transition of these privately placed securities to the public market, expanding the potential investor base.
Investors should be aware that the securities sold in this private placement are currently restricted and cannot be sold in the United States without registration or an applicable exemption. The company's pledge to file for registration not only adheres to legal obligations but also signals to the market its intention to ensure that these securities can be traded more freely in the future.
The amendment of existing warrants as part of the offering process is a noteworthy legal maneuver. It requires shareholder approval, which reflects corporate governance practices that respect the rights and interests of existing shareholders. The reduced exercise price aligns the terms with the current private placement, potentially harmonizing the company's capital structure and incentive mechanisms for investors.
Actelis Networks operates within the burgeoning Internet of Things (IoT) sector, where cyber-hardened, rapid deployment networking solutions are increasingly vital. The capital raised from this private placement is likely earmarked for strategic initiatives that could enhance the company's competitive edge in this sector, such as research and development, market expansion, or infrastructure improvements.
The IoT industry is characterized by rapid innovation and a constant need for capital to keep pace with technological advancements. Actelis Networks' move to secure additional funds through a private placement is consistent with industry norms where companies must be agile and financially robust to seize market opportunities.
However, the relatively modest amount raised, approximately $1.5 million, suggests a conservative approach or a targeted strategy rather than a large-scale expansion. This level of funding could indicate a focus on specific, immediate operational needs or small-scale strategic projects. Stakeholders should monitor how effectively the company deploys these funds to drive growth within its niche in the IoT market.
The potential for additional proceeds if the warrants are exercised could provide a future financial buffer. However, investors must consider the inherent uncertainty in whether these warrants will be exercised, as this depends on the company's future performance and market conditions.
Overall, Actelis Networks' private placement should be evaluated within the broader context of the IoT industry's growth potential and the company's strategic positioning. The additional capital may provide the necessary resources to capitalize on emerging opportunities in the IoT landscape, but its impact will be measured by the company's execution of its business objectives.
FREMONT, Calif., Dec. 20, 2023 (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 closing of its previously announced private placement, priced at-the-market under Nasdaq rules, of 1,271,187 shares of its common stock (or common stock equivalents) and warrants to purchase up to 1,271,187 shares of its common stock at a purchase price of
Actelis expects to use the gross proceeds from the private placement of approximately
H.C. Wainwright & Co. acted as the exclusive placement agent for the offering.
The securities described above were offered in a private placement under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”) and Regulation D promulgated thereunder and, along with the shares of common stock underlying the warrants, have not been registered under the Securities Act or applicable state securities laws. Accordingly, the securities 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. Under an agreement with the investors, the Company agreed to file an initial registration statement with the SEC covering the resale of the securities described above no later than 20 days following the date of the agreement and to use commercially reasonable efforts to have the registration statement declared effective as promptly as practical thereafter, and in any event no later than 75 days following the date of the agreement in the event of a “full review” by the SEC.
In connection with the offering, the Company also has agreed to amend certain existing warrants to purchase up to an aggregate of 999,670 shares of the Company's common stock that were previously issued in May 2023 (and amended in November 2023) at an exercise price of
This press release shall not constitute an offer to sell or a solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or other 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 other 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-copper, 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 use of proceeds from the private placement and obtaining shareholder approval. 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 to 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 did Actelis Networks announce?
How many shares were included in the private placement?
What is the purchase price of the shares in the private placement?
What are the expected gross proceeds from the private placement?
Who acted as the exclusive placement agent for the offering?
