Lichen China Limited Announces $2.70 Million Registered Direct Offering

Rhea-AI Summary

Lichen China (LICN) has announced a registered direct offering of 15,000,000 Class A ordinary shares at $0.18 per share, aiming to raise approximately $2.70 million in gross proceeds. The offering includes pre-funded warrants with an exercise price of $0.001 per share. The transaction is expected to close around December 13, 2024, with Univest Securities, serving as the sole placement agent. The offering is being conducted under a shelf registration statement on Form F-3 previously declared effective by the SEC on March 1, 2024.

Positive

• Secured $2.70 million in additional funding through share offering

Negative

• Significant share dilution with 15,000,000 new shares being issued
• Low offering price of $0.18 per share indicates weak market conditions

Insights

Financial Analyst

The $2.70 million registered direct offering by Lichen China at $0.18 per share represents a significant dilution for existing shareholders, as the offering price is substantially below the current market price. With 15 million new shares being issued, this will considerably increase the company's outstanding shares and dilute earnings per share. The timing and pricing of this offering raises concerns about the company's ability to secure more favorable financing terms. While the capital raise provides immediate liquidity, the steep discount and use of pre-funded warrants suggests challenging market conditions for the company. This financing structure, combined with the relatively small size of the offering compared to the company's market cap, indicates potential cash flow pressures that warrant careful monitoring.

XIAMEN, China, Dec. 12, 2024 /PRNewswire/ -- Lichen China Limited (Nasdaq: LICN) ("Lichen China" or the "Company"), a dedicated financial and taxation service provider in China today announced that it has entered into a definitive agreement with several investors for the purchase and sale of an aggregate of 15,000,000 of the Company's Class A ordinary share, par value $0.00004 per share (the "Shares") (or pre-funded warrants in lieu thereof) at a purchase price of $0.18 per share in a registered direct offering. The purchase price for the pre-funded warrants is identical to the purchase price for Shares, less the exercise price of $0.001 per share.

The aggregate gross proceeds to the Company of this offering are expected to be approximately $2.70 million. The transaction is expected to close on or about December 13, 2024, subject to the satisfaction of customary closing conditions.

Univest Securities, LLC is acting as the sole placement agent.

The registered direct offering is being made pursuant to a shelf registration statement on Form F-3 (File No. 333-277230) previously filed by the Company and declared effective by the U.S. Securities and Exchange Commission ("SEC") on March 1, 2024. A final prospectus supplement and accompanying prospectus describing the terms of the proposed offering will be filed with the SEC and will be available on the SEC's website located at http://www.sec.gov. Electronic copies of the final prospectus supplement and the accompanying prospectus may be obtained, when available, by contacting Univest Securities, LLC at info@univest.us, or by calling +1 (212) 343-8888.

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 such 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. Copies of the prospectus supplement relating to the registered direct offering, together with the accompanying base prospectus will be filed by the Company and, upon filing, can be obtained at the SEC's website at www.sec.gov.

About Lichen China Limited

Lichen China Limited focuses on providing financial and taxation solution services, education support services, and software and maintenance services under its "Lichen" brand. In recognition of the Company's expertise and experience in the financial and taxation solution services industry for over 18 years, the Company has built up its reputation as a dedicated financial and taxation solution services provider of professional and high-quality services in China. For more information, please visit the Company's website: https://ir.lichenzx.com/.

Forward-Looking Statements

Certain statements in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations and projections about future events and financial trends that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can identify these forward-looking statements by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to" or other similar expressions. The Company undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results in the Company's registration statement and in its other filings with the U.S. Securities and Exchange Commission.

For more information, please contact:

Tian Sun
Phone: +86-0592-5586999
Email: ir@lichenzx.com

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SOURCE Lichen China Limited

FAQ

What is the size and price of Lichen China's (LICN) December 2024 offering?

Lichen China's offering consists of 15,000,000 Class A ordinary shares priced at $0.18 per share, totaling approximately $2.70 million in gross proceeds.

When is LICN's 2024 registered direct offering expected to close?

The offering is expected to close on or about December 13, 2024, subject to customary closing conditions.

What is the exercise price of LICN's pre-funded warrants in the December 2024 offering?

The pre-funded warrants have an exercise price of $0.001 per share, with a purchase price equal to the share price minus the exercise price.

Who is the placement agent for LICN's December 2024 registered direct offering?

Univest Securities, is acting as the sole placement agent for the offering.