Cellebrite Announces Results of Completed Redemption of All Outstanding Warrants

Rhea-AI Summary

Cellebrite DI (Nasdaq: CLBT) has announced the results of its completed redemption of all outstanding warrants. Key points include:

- 99.4% of outstanding Public Warrants were exercised, with 4,645 exercised for cash and 19,878,580 exercised cashlessly.

- 116,224 unexercised Public Warrants were redeemed for $11,622.40.

- All 9,666,667 Private Placement Warrants were exercised cashlessly.

- Public Warrants have stopped trading on Nasdaq and been delisted.

- The redemption does not affect the trading of Cellebrite's Ordinary Shares (CLBT).

Positive

• High warrant exercise rate of 99.4% for Public Warrants
• All Private Placement Warrants exercised
• Simplified capital structure with no more outstanding Public Warrants
• Potential cash inflow from cash exercises of warrants

Negative

• Dilution of existing shareholders due to new shares issued from warrant exercises
• Delayed issuance of shares for Private Placement Warrants pending tax exemption

Financial Analyst

Cellebrite's warrant redemption marks a significant financial restructuring, simplifying the company's capital structure. The high redemption rate of 99.4% for public warrants indicates strong investor confidence. This move will reduce potential dilution and simplify the company's balance sheet. The cashless exercise of private placement warrants, resulting in 3,306,000 new ordinary shares, will impact earnings per share calculations. However, the delayed issuance due to tax considerations adds a layer of complexity. Overall, this action streamlines Cellebrite's equity structure, potentially making it more attractive to institutional investors who prefer simpler capital structures.

Legal Expert

The warrant redemption process demonstrates Cellebrite's meticulous adherence to securities regulations. The company's proactive approach in obtaining a ruling from the Israeli Tax Authority for public warrant holders showcases its commitment to shareholder interests. The extension granted to private placement warrant holders until February 2025 for tax exemption reflects a balanced approach to stakeholder management. This legal maneuver mitigates potential tax liabilities for warrant holders while ensuring compliance with both U.S. and Israeli regulations. The delisting of warrants from Nasdaq, without affecting ordinary share trading, further streamlines Cellebrite's securities profile, potentially reducing regulatory complexities moving forward.

TYSONS CORNER, Va. and PETAH TIKVA, Israel, Sept. 18, 2024 (GLOBE NEWSWIRE) -- Cellebrite DI Ltd. (Nasdaq: CLBT) (“Cellebrite,” the “Company” or “we”), a global leader in premier Digital Investigative solutions for the public and private sectors, announced today the results of the completed redemption (the “Redemption”) of its Warrants (as defined below) to purchase ordinary shares of the Company (the “Ordinary Shares”).

On August 15, 2024, the Company announced that it will redeem all of its Warrants that remain outstanding at 5:00 p.m. New York City time on September 16, 2024 (the “Redemption Date”) for a redemption price of $0.10 per Warrant.

The Warrants include (i) the outstanding public warrants to purchase Ordinary Shares (the “Public Warrants”) issued pursuant to that certain Assignment, Assumption and Amended and Restated Warrant Agreement, dated on August 30, 2021 (the “Warrant Agreement”), between the Company and Equiniti Trust Company, LLC (as successor to American Stock Transfer & Trust Company, LLC), which were originally issued by TWC Tech Holdings II Corp. (“TWC”) in connection with its initial public offering and subsequently assumed by the Company and converted into warrants to purchase Ordinary Shares of the Company as a result of the Company’s business combination with TWC which was consummated on August 30, 2021 (the “Business Combination”), and (ii) the outstanding private placement warrants to purchase Ordinary Shares (the “Private Placement Warrants” and, together with the Public Warrants, the “Warrants”) originally issued by TWC in a private placement transaction under the Private Placement Warrants Purchase Agreement, dated as of September 10, 2020, by and between TWC and TWC Tech Holdings II, LLC, and converted into warrants to purchase Ordinary Shares of the Company as a result of the Business Combination, on the same terms as the outstanding Public Warrants.

Of the 19,999,449 Public Warrants that were outstanding as of August 15, 2024, 4,645 Public Warrants were exercised for cash at an exercise price of $11.50 per Ordinary Share in exchange for an aggregate of 4,645 Ordinary Shares and 19,878,580 Public Warrants were exercised on a cashless basis in exchange for an aggregate of 6,798,440 Ordinary Shares. The Public Warrants that were exercised represented 99.4% of the outstanding Public Warrants in the aggregate. A total of 116,224 Public Warrants remained unexercised as of the Redemption Date, and the Company redeemed those Public Warrants for an aggregate redemption price of $11,622.40. Following the Redemption Date, the Company had no Public Warrants outstanding.

Of the 9,666,667 Private Placement Warrants that were outstanding as of August 15, 2024, the Company received a notice of exercise with respect to all of the Private Placement Warrants, to be exercised on a cashless basis in exchange for an aggregate of 3,306,000 Ordinary Shares. The holder of the Private Placement Warrants did not benefit from the ruling obtained by the Company from the Israeli Tax Authority (“ITA”) with respect to cashless exercises by holders of Public Warrants as described in the Company’s previously issued notice of redemption and, therefore, the Company has granted such holder until February 25, 2025 (the “Outside Date”) to obtain an exemption from withholding tax from the ITA. The number of Ordinary Shares issuable upon exercise of the Private Placement Warrants is not subject to change or adjustment. The Ordinary Shares will not be issued until the earlier of such exemption being obtained and the Outside Date.

In connection with the Redemption, the Public Warrants stopped trading on the Nasdaq Global Select Market (“Nasdaq”) and have been delisted. The Redemption had no effect on the trading of the Company’s Ordinary Shares, which continue to trade on Nasdaq under the ticker symbol “CLBT.”

This press release does not and will not constitute an offer to sell, or the solicitation of an offer to buy, the Warrants, the Ordinary Shares, or any other securities, nor will there be any sale of the Warrants, the Ordinary Shares or any such other securities, in any state or other jurisdiction in which such offer, sale or solicitation would be unlawful.

About Cellebrite

Cellebrite’s (Nasdaq: CLBT) mission is to enable its customers to protect and save lives, accelerate justice, and preserve privacy in communities around the world. We are a global leader in Digital Investigative solutions for the public and private sectors, empowering organizations in mastering the complexities of legally sanctioned digital investigations by streamlining intelligence processes. Trusted by thousands of leading agencies and companies worldwide, Cellebrite’s Digital Investigative platform and solutions transform how customers collect, review, analyze and manage data in legally sanctioned investigations. To learn more visit us at www.cellebrite.com, https://investors.cellebrite.com, or follow us on X at @Cellebrite.

References to Websites and Social Media Platforms

References to information included on, or accessible through, websites and social media platforms do not constitute incorporation by reference of the information contained at or available through such websites or social media platforms, and you should not consider such information to be part of this press release.

Media 

Victor Cooper 
Sr. Director of Corporate Communications + Content Operations 
Victor.cooper@cellebrite.com 
+1 404.804.5910 

Investor Relations 

Andrew Kramer 
Vice President, Investor Relations 
investors@cellebrite.com 
+1 973.206.7760

FAQ

What was the redemption price for Cellebrite's (CLBT) warrants?

Cellebrite (CLBT) redeemed its warrants at a price of $0.10 per warrant on September 16, 2024.

How many Cellebrite (CLBT) Public Warrants were exercised before the redemption date?

19,883,225 Cellebrite (CLBT) Public Warrants were exercised before the redemption date, representing 99.4% of outstanding Public Warrants.

What happened to Cellebrite's (CLBT) unexercised Public Warrants?

116,224 unexercised Cellebrite (CLBT) Public Warrants were redeemed for a total of $11,622.40 on the redemption date.

How were Cellebrite's (CLBT) Private Placement Warrants handled in the redemption?

All 9,666,667 Cellebrite (CLBT) Private Placement Warrants were exercised cashlessly, with shares to be issued by February 25, 2025, pending tax exemption.