Laser Photonics Corporation Announces Pricing of $3.0 Million Private Placement

Rhea-AI Summary

Laser Photonics (NASDAQ: LASE), a leading industrial laser systems developer, has announced a $3.0 million private placement with institutional investors. The company will issue 1,500,000 units and pre-funded units, each consisting of one share of common stock (or pre-funded warrant) and one common warrant. The common warrants will be exercisable at $4.34 per share and will expire 5.5 years from issuance. Aegis Capital Corp is acting as the Exclusive Placement Agent. The closing is expected around August 19, 2024. LPC plans to use the net proceeds for working capital and general corporate purposes. The securities are being sold in a private placement exempt from SEC registration requirements.

Positive

• Secured $3.0 million in funding through private placement
• Potential for additional capital through warrant exercises at $4.34 per share
• Strengthened working capital position for operations and growth

Negative

• Potential dilution of existing shareholders' equity
• Securities issued at a discount to market price, indicating possible unfavorable terms
• Reliance on private placement suggests potential difficulties in accessing public markets

Insights

Financial Analyst

Laser Photonics 's $3.0 million private placement is a double-edged sword for investors. While it provides much-needed working capital, it also signals potential cash flow issues. The issuance of 1,500,000 units, combining shares and warrants, will lead to significant dilution for existing shareholders. The $4.34 warrant exercise price, substantially higher than the current stock price, suggests management's optimism about future growth. However, the use of pre-funded warrants indicates a complex financial structure, potentially to navigate around Nasdaq's minimum price requirements. This financing, while addressing immediate capital needs, raises questions about the company's long-term financial health and ability to generate sustainable revenue.

Tech Expert

LPC's focus on industrial laser systems for cleaning and material processing positions it in a growing market. The additional capital could accelerate R&D efforts, potentially leading to innovative products. However, the company's need for external financing suggests it hasn't yet achieved significant market traction. The industrial laser sector is highly competitive, with established players like IPG Photonics and Coherent dominating. LPC must demonstrate a clear technological edge or cost advantage to justify its valuation. The success of this capital raise will ultimately depend on how effectively management deploys the funds to enhance their product offerings and expand market share in the face of stiff competition.

Market Research Analyst

This private placement reflects broader trends in the small-cap tech sector, where companies often struggle to secure traditional financing. The timing is crucial, as the industrial automation market is projected to grow significantly in the coming years. However, LPC's reliance on private placements may indicate challenges in attracting institutional investors or securing more favorable terms. The 5.5-year warrant expiration suggests a long-term commitment from the new investors, but also ties up potential upside for existing shareholders. LPC's ability to convert this capital into tangible market share gains will be critical for its future valuation and investor sentiment.

ORLANDO, Fla.--(BUSINESS WIRE)-- Laser Photonics Corporation (LPC) (NASDAQ: LASE), a leading global developer of industrial laser systems for cleaning and other material processing applications, today announced that it has entered into a securities purchase agreement with institutional investors for aggregate gross cash proceeds of $3.0 million, before deducting fees to the placement agent and other offering expenses payable by the Company. The Company intends to use the net proceeds from the private placement for working capital and general corporate purposes.

In connection with the private placement, the Company will issue an aggregate of 1,500,000 units and pre-funded units. The pre-funded units will be sold at the same purchase price as the units, less the pre-funded warrant exercise price of $0.001. Each unit and pre-funded unit will consist of one share of common stock (or one pre-funded warrant) and one common warrant, each exercisable for one share of common stock at an exercise price of $4.34 per share. The common warrant will be exercisable on the earlier of six months after issuance or shareholder approval and will expire 5.5 years from issuance.

The closing of the private placement is expected to occur on or about August 19, 2024, subject to the satisfaction of customary closing conditions.

Aegis Capital Corp. is acting as the Exclusive Placement Agent for the private placement. CM Law PLLC is serving as counsel to the Company for the private placement. Kaufman & Canoles, P.C. is serving as counsel to Aegis Capital Corp. for the private placement.

The securities described above are being sold in a private placement exempt from the registration requirements of the Securities Act of 1933, as amended (the “Act”), and have not been registered under the Act, or applicable state securities laws. Accordingly, the securities may not be offered or sold in the United States except pursuant to an effective registration statement or an applicable exemption from the registration requirements of the Act and such applicable state securities laws. Pursuant to a registration rights agreement with the investor, the Company has agreed to file one or more registration statements with the Securities and Exchange Commission (the “SEC”) covering the resale of the shares of common stock sold in the private placement and the shares of common stock issuable upon exercise of the pre-funded warrants and the warrants sold in the private placement.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities described herein, 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 registration or qualification under the securities laws of any such state or jurisdiction.

About Laser Photonics Corporation

Laser Photonics is a vertically integrated manufacturer and R&D Center of Excellence for industrial laser technologies and systems. Laser Photonics seeks to disrupt the $46 billion, centuries-old sand and abrasives blasting markets, focusing on surface cleaning, rust removal, corrosion control, de-painting and other laser-based industrial applications. Laser Photonics’ new generation of leading-edge laser blasting technologies and equipment also addresses the numerous health, safety, environmental and regulatory issues associated with old methods. As a result, Laser Photonics has quickly gained a reputation as an industry leader in industrial laser systems with a brand that stands for quality, technology and product innovation. Currently, world-renowned and Fortune 1000 manufacturers in the aerospace, automotive, defense, energy, industrial, maritime, space exploration and shipbuilding industries are using Laser Photonics’ "unique-to-industry" systems. For more information, visit https://www.laserphotonics.com.

Cautionary Note Concerning Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 concerning Greenlane and other matters. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements. In some cases, you can identify forward-looking statements by terms such as "may," "will," "should," "expects," "plans," "anticipates," "could," "intends," "targets," "projects," "contemplates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of these terms or other similar expressions. The forward-looking statements in this press release are only predictions. Laser Photonics Corporation has based these forward-looking statements largely on its current expectations and projections about future events and financial trends that it believes may affect its business, financial condition and results of operations. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. You should carefully consider the risks and uncertainties that affect our business, including those described in our filings with the Securities and Exchange Commission ("SEC"), including under the caption "Risk Factors" in Laser Photonics Corporation's Annual Report on Form 10-K filed for the year ended December 31, 2023 and the Company's other filings with the SEC, which can be obtained on the SEC website at www.sec.gov. These forward-looking statements speak only as of the date of this communication. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements, whether as a result of any new information, future events or otherwise. You are advised, however, to consult any further disclosures we make on related subjects in our public announcements and filings with the SEC.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240816097724/en/

Investor Relations Contact:

laser@haydenir.com

Media Contact:

Karla Kizzort

Marketing Specialist

Laser Photonics Corporation

kkizzort@laserphotonics.com

Source: Laser Photonics Corporation

FAQ

What is the total amount raised by Laser Photonics (LASE) in the private placement?

Laser Photonics (NASDAQ: LASE) raised $3.0 million in gross proceeds through the private placement with institutional investors.

How many units and pre-funded units will LASE issue in the private placement?

Laser Photonics will issue an aggregate of 1,500,000 units and pre-funded units in connection with the private placement.

What is the exercise price of the common warrants issued by LASE in the private placement?

The common warrants issued by Laser Photonics (LASE) in the private placement have an exercise price of $4.34 per share.

When is the expected closing date for LASE's private placement?

The closing of Laser Photonics 's (LASE) private placement is expected to occur on or about August 19, 2024, subject to customary closing conditions.

How does LASE plan to use the proceeds from the private placement?

Laser Photonics (LASE) intends to use the net proceeds from the private placement for working capital and general corporate purposes.