bioAffinity Technologies Announces Closing of Warrant Inducement Transaction for Aggregate Gross Proceeds of $1.4 Million

Rhea-AI Summary

bioAffinity Technologies (NASDAQ: BIAF) has closed warrant exercise agreements with four accredited investors, generating gross proceeds of $1.4 million. The transaction involves the exercise of existing warrants to purchase 2,438,473 common shares at a reduced exercise price of $0.58 per share (down from $1.50).

In exchange, investors will receive new unregistered warrants to purchase up to 2,926,166 shares (120% of exercised shares) at $0.85 per share. These new warrants will become exercisable upon stockholder approval and expire five years after approval. WallachBeth Capital serves as the sole placement agent for this warrant inducement transaction.

Positive

• Immediate cash injection of $1.4M gross proceeds
• Successfully closed warrant exercise agreement with four investors

Negative

• Significant warrant exercise price reduction from $1.50 to $0.58 (-61%)
• Additional dilution potential from 2.9M new warrants
• New warrants subject to stockholder approval

Insights

Financial Analyst

bioAffinity Technologies has secured $1.4 million through a strategic warrant inducement transaction with four existing investors, representing a significant capital infusion equivalent to approximately 11.5% of the company's $12.2 million market capitalization.

The transaction involves two key components: (1) existing investors exercised warrants to purchase 2.44 million shares at a substantially reduced price of $0.58 per share (down from $1.50, a 61% discount); and (2) in exchange, these investors received new warrants to purchase an additional 2.93 million shares at $0.85 per share, executable after stockholder approval.

The structure of this deal reveals several critical insights. The steep warrant price reduction suggests urgency in securing immediate capital, while the 46% premium on the new warrants ($0.85 vs. current $0.58) indicates some investor confidence in future value creation. For a microcap biotech company, this transaction represents a double-edged sword: it provides essential operating capital without debt obligations, but at the cost of significant dilution to existing shareholders.

The requirement for stockholder approval for the new warrants adds an important governance element and potential uncertainty to the second phase of this financing. Should these new warrants eventually be exercised, they would provide an additional $2.49 million in future funding ($0.85 × 2.93M), potentially extending the company's runway further.

This financing approach is characteristic of cash-constrained microcap biotechs facing challenging capital markets, prioritizing near-term survival and operational continuity over minimizing dilution. Investors should monitor how bioAffinity deploys this capital and whether it enables meaningful progress toward value-creating milestones.

SAN ANTONIO--(BUSINESS WIRE)-- bioAffinity Technologies, Inc. (NASDAQ: BIAF and BIAFW) announced today it has closed its previously announced warrant exercise agreements with four existing accredited investors to exercise certain outstanding warrants to purchase an aggregate of 2,438,473 of the Company’s shares of common stock (the “Existing Warrants”). In consideration for the immediate exercise in full of the Existing Warrants for gross cash proceeds of approximately $1.4 million, the exercising holders will receive in a private placement new unregistered warrants (the “New Warrants”) to purchase up to an aggregate of 2,926,166 shares of common stock (equal to 120% of the shares of common stock issued in connection with the exercise of the Existing Warrants) with an exercise price of $0.85 per share. The New Warrants are initially exercisable on the date that stockholder approval of the exercise of the New Warrants is obtained and will expire five years from the date of such approval. In connection with the exercise of the Existing Warrants, the Company agreed to reduce the exercise price of the Existing Warrants from $1.50 to $0.58 per share.

The gross proceeds from the warrant inducement are expected to be approximately $1.4 million, excluding any proceeds that may be received upon the exercise of the New Warrants and before deducting placement agent fees and other offering expenses payable by the Company.

WallachBeth Capital is acting as sole placement agent for the warrant inducement transaction.

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

About CyPath® Lung

CyPath® Lung uses advanced flow cytometry and artificial intelligence (AI) to identify cell populations in patient sputum that indicate malignancy. Automated data analysis helps determine if cancer is present or if the patient is cancer-free. CyPath® Lung incorporates a fluorescent porphyrin, TCPP, that is preferentially taken up by cancer and cancer-related cells. Clinical study results demonstrated that CyPath® Lung had 92% sensitivity, 87% specificity and 88% accuracy in detecting lung cancer in patients at high risk for the disease who had small lung nodules less than 20 millimeters. Diagnosing and treating early-stage cancer can improve outcomes and increase patient survival.

About bioAffinity Technologies, Inc.

bioAffinity Technologies, Inc. addresses the need for noninvasive diagnosis of early-stage cancer and diseases of the lung and broad-spectrum cancer treatments. The Company’s first product, CyPath® Lung, is a noninvasive test that has shown high sensitivity, specificity and accuracy for the detection of early-stage lung cancer. CyPath® Lung is marketed as a Laboratory Developed Test (LDT) by Precision Pathology Laboratory Services, a subsidiary of bioAffinity Technologies. For more information, visit www.bioaffinitytech.com and follow us on LinkedIn, Facebook and X.

Forward-Looking Statements

This press release contains forward-looking statements, including statements regarding the anticipated exercise of warrants, the anticipated gross proceeds from the Company’s offering of securities and the expected closing of the offering. Forward-looking statements can be identified by words such as “believes,” “expects,” “estimates,” “intends,” “may,” “plans,” “will” and similar expressions, or the negative of these words. Such forward-looking statements are based on facts and conditions as they exist at the time such statements are made and predictions as to future facts and conditions. Readers of this press release are cautioned not to place undue reliance on any forward-looking statements. 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. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to the Company’s ability to close the offering and risks and uncertainties included under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other reports filed with the SEC from time to time. The Company does not undertake any obligation to update any forward-looking statement relating to matters discussed in this press release, except as may be required by applicable securities laws.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250226562316/en/

Contacts

bioAffinity Technologies

Julie Anne Overton

Director of Communications

jao@bioaffinitytech.com

Investor Relations

Dave Gentry

RedChip Companies Inc.

1-800-RED-CHIP (733-2447) or 407-491-4498

BIAF@redchip.com

Source: bioAffinity Technologies, Inc.

FAQ

How much did bioAffinity Technologies (BIAF) raise in the warrant inducement transaction?

BIAF raised approximately $1.4 million in gross proceeds from the warrant exercise transaction.

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

The new warrants have an exercise price of $0.85 per share.

How many new warrants did BIAF issue in the inducement transaction?

BIAF issued new warrants to purchase up to 2,926,166 shares, representing 120% of the exercised existing warrants.

What was the price reduction for BIAF's existing warrants in this transaction?

The exercise price of existing warrants was reduced from $1.50 to $0.58 per share.