Intuitive Machines Enters into Warrant Exercise Transaction for $11.8 Million in Gross Proceeds
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The warrant exercise agreement by Intuitive Machines, Inc. represents a strategic capital raising activity that directly infuses approximately $11.8 million of gross proceeds into the company. This is a non-dilutive financing option that allows the company to strengthen its balance sheet without immediately increasing the number of shares outstanding, which could have been dilutive to existing shareholders. The creation of new Series A and Series B Warrants as part of the transaction suggests a vote of confidence by the existing accredited investor in the company's long-term prospects.
However, the potential future dilution from the exercise of these new warrants should be monitored, as it could impact the stock's valuation. The beneficial ownership restriction is a common anti-dilution measure to prevent over-concentration of ownership. It's also noteworthy that the company has committed to filing a registration statement with the SEC, which will enhance the liquidity of the Class A common shares issuable upon exercise of the New Warrants, potentially increasing market interest in the company's stock.
The transaction described involves complex securities regulations, including the Securities Exchange Act of 1934 and the Securities Act of 1933. The issuance of unregistered warrants and the requirement for stockholder approval underscore the importance of compliance with federal securities laws. The waiting period pursuant to Section 14C of the Exchange Act indicates a mandatory process for shareholder notification and consent, which reflects corporate governance standards and shareholder rights.
The fact that the securities were offered in a private placement to an accredited investor and are subject to a future registration statement for resale highlights the regulatory framework that governs private and public offerings, as well as the resale of securities. The conditions set forth for the exercise of the New Warrants, including the beneficial ownership restrictions, are designed to comply with the regulations and protect against market manipulation.
Intuitive Machines, Inc.'s focus on space exploration, infrastructure and services positions it within a high-growth industry. The successful warrant exercise indicates a strong relationship with at least one key investor and provides the company with capital to potentially fund ongoing projects or expand operations. The space sector is highly capital-intensive, with significant upfront costs and long development timelines, making the timing and amount of capital raised critical to a company's ability to execute its business plan and maintain a competitive edge.
The transaction may also signal to the market that Intuitive Machines is progressing towards milestones that could warrant (no pun intended) increased investor confidence. It's pertinent for market researchers to analyze how this influx of capital might translate into accelerated development timelines or new partnerships, which could, in turn, have a substantial impact on the company's market position and stock performance in the long term.
HOUSTON, Jan. 11, 2024 (GLOBE NEWSWIRE) -- Intuitive Machines, Inc. (Nasdaq: LUNR) (“Intuitive Machines” or the “Company”), a leading space exploration, infrastructure, and services company, announced today that it has entered into a warrant exercise agreement with an existing accredited investor to exercise in full an outstanding Series B Common Stock Purchase Warrant to purchase up to an aggregate of 4,705,883 shares of the Company’s Class A common stock (the “Existing Series B Warrant”). In consideration for the immediate and full exercise of the Existing Series B Warrant for cash, the exercising holder received (i) a new unregistered Series A Common Stock Purchase Warrant to purchase up to an aggregate of 4,705,883 shares of the Company’s Class A common stock (the “New Series A Warrant”) and (ii) a new unregistered Series B Common Stock Purchase Warrant to purchase up to an aggregate of 4,705,883 shares of the Company’s Class A common stock (the “New Series B Warrant” and together with the New Series A Warrant, the “New Warrants”).
The New Series A Warrant will become exercisable commencing upon the Company’s receipt of final stockholder approval, including following expiration of any waiting period required pursuant to Section 14C of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The New Series A Warrant has an expiration date five and one-half years after the date of the stockholder approval. The New Series B Warrant will become exercisable commencing upon the Company’s receipt of final Stockholder Approval, including following expiration of any waiting period required pursuant to Section 14C of the Exchange Act, and has an expiration date of 18 months after the date of the Stockholder Approval. The New Warrants include beneficial ownership restrictions that prevent the holder from owning more than
The gross proceeds to the company from the exercise of the Existing Series B Warrant was approximately
Cantor Fitzgerald & Co. acted as the exclusive-warrant inducement agent for the transaction.
The New Warrants described above were offered in a private placement pursuant to an applicable exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), and, along with the Class A common shares issuable upon their exercise, have not been registered under the Securities Act, and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission (the “SEC”) or an applicable exemption from such registration requirements. The securities were offered only to an accredited investor. The Company has agreed to file a registration statement with the SEC covering the resale of Class A common shares issuable upon exercise of the New Warrants. 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 jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
About Intuitive Machines
Intuitive Machines is a diversified space company focused on space exploration. Intuitive Machines supplies space products and services to support sustained robotic and human exploration to the Moon, Mars, and beyond. Intuitive Machines’ products and services are offered through its four business units: Lunar Access Services, Orbital Services, Lunar Data Services, and Space Products and Infrastructure. For more information, please visit www.intuitivemachines.com.
Forward-Looking Statements
This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking. These forward-looking statements generally are identified by the words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “strive,” “would,” “strategy,” “outlook,” the negative of these words or other similar expressions, but the absence of these words does not mean that a statement is not forward-looking. The Company is using forward-looking statements in this press release when it discusses its expectations regarding the completion of the warrant exercise transaction, the satisfaction of customary closing conditions related to the warrant exercise transaction and the expected receipt and intended uses of the proceeds from the warrant exercise transaction. However, the conditions for the closing of the warrant exercise may not be met and the proceeds may not be received or if received may not be used as currently anticipated. Because such statements deal with future events and are based on the Company’s current expectations, they are subject to various risks and uncertainties and actual results, performance or achievements of the Company could differ materially from those described in or implied by the statements in this press release. The forward-looking statements contained or implied in this press release are subject to other risks and uncertainties, including those discussed under the section titled Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 filed with the SEC on March 31, 2023, the section titled Part I, Item 2, Management's Discussion and Analysis of Financial Condition and Results of Operations and the section titled Part II. Item 1A. “Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, and in our subsequent filings with the SEC, which are accessible on the SEC's website at www.sec.gov and the Investors section of our website at https://investors.intuitivemachines.com.
These forward-looking statements are based on information available as of the date of this press release and current expectations, forecasts, and assumptions, and involve a number of judgments, risks, and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities laws.
Contacts
For investor inquiries:
investors@intuitivemachines.com
For media inquiries:
press@intuitivemachines.com
FAQ
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