MGO Global Announces Pricing of Upsized $6.0 Million Public Offering

Rhea-AI Summary

MGO Global Inc. (Nasdaq: MGOL) has announced the pricing of an upsized public offering of 6,315,000 units at $0.95 per unit, aiming to raise $6.0 million in gross proceeds. Each unit includes one share of common stock (or pre-funded warrant) and one warrant to purchase one share of common stock. The warrants will be exercisable at $1.425 per share after stockholder approval and will expire in five years or upon MGO's business combination with Heidmar, Inc. The offering, managed by Maxim Group as sole placement agent, is expected to close on December 24, 2024.

Positive

• Secured $6.0 million in gross proceeds through public offering
• Warrants include potential upside with $1.425 exercise price, representing 50% premium to offering price
• Alternative cashless exercise option allows warrant holders to exchange for two shares

Negative

• Significant dilution to existing shareholders through issuance of 6,315,000 new units
• Offering price of $0.95 per unit indicates potential discount to market price
• Additional dilution possible through warrant exercises
• Warrant exercise contingent on stockholder approval, adding uncertainty

Insights

Financial Analyst

This $6.0 million public offering by MGO Global represents a significant capital raise for a micro-cap company with a market capitalization of just $4.07 million. The pricing at $0.95 per unit reflects a complex offering structure combining common stock with warrants. The warrant terms, particularly the $1.425 exercise price and alternative cashless exercise option for two shares, indicate potential significant dilution for existing shareholders.

The timing of this offering, coinciding with the pending Heidmar business combination, suggests this capital raise may be related to transaction costs or working capital needs. The warrant expiration tied to the Heidmar deal creates urgency for exercise. The upsized nature of the offering to $6.0 million from its original size implies decent investor interest, though the unit pricing below $1.00 reflects current market conditions for micro-cap stocks.

For simple understanding: Imagine a company worth $4 million selling new pieces of ownership worth $6 million. This will significantly change who owns how much of the company and current owners will end up owning a smaller piece of a potentially larger pie.

Legal Expert

The offering's complex structure requires careful regulatory compliance, evidenced by the dual registration statements (Form S-1) and Rule 462(b) filing. The warrant exercise conditions, particularly requiring stockholder approval, provide important investor protections while satisfying SEC requirements. The clear disclosure about warrant terms, especially the reset provisions and floor price mechanisms, demonstrates proper securities law compliance.

Simplified explanation: The company is following strict legal rules to sell new shares and special rights to buy more shares later. They're being careful to get all necessary approvals and tell investors exactly what they're buying, which is important to protect both the company and investors.

MIAMI, FL and LONDON, UK / ACCESSWIRE / December 23, 2024 / MGO Global Inc. (Nasdaq:MGOL), a digitally-native, lifestyle brand portfolio company, ("MGO," "MGO Global" or the "Company"), today announced the pricing of its public offering of 6,315,000 units at a public offering price of $0.95 per unit. Each unit consists of one share of common stock (or pre-funded warrant in lieu thereof) and one warrant to purchase one share of common stock.

The warrants, which are not exercisable unless and until approved by MGO stockholders, will be initially exercisable at a price of $1.425 per share, subject to standard adjustments for dividends, splits and similar events and also subject to adjustment upon reset on the Reset Date (as described in the warrants), subject to a floor price described therein. The warrants may also be exercised on an alternative cashless basis pursuant to which the holder may exchange each warrant for two shares of common stock. The warrants will become exercisable after notice is provided regarding stockholder approval and will expire on the earlier of (x) five years from the initial exercise date and (y) the closing date of MGO's publicly announced business combination with Heidmar, Inc. The shares of common stock (or pre-funded warrants) and accompanying warrants can only be purchased together in this public offering but will be issued separately and will be immediately separable upon issuance. Gross proceeds to the Company, before deducting placement agent's fees and other offering expenses, are expected to be $6.0 million. The offering is expected to close on December 24, 2024, subject to the satisfaction of customary closing conditions.

Maxim Group LLC is acting as sole placement agent in connection with the offering.

A registration statement on Form S-1 (File No. 333-282517) was filed with the U.S. Securities and Exchange Commission ("SEC") and was declared effective by the SEC on December 20, 2024 and a registration statement on Form S-1 (File No. 333-284001) filed pursuant to Rule 462(b) of the Securities Act of 1933, as amended, was filed with the SEC and became effective on December 20, 2024. A final prospectus relating to the offering will be filed with the SEC and will be available on the SEC's website at http://www.sec.gov. The offering is being made only by means of a prospectus forming part of the effective registration statements. Electronic copies of the prospectus relating to this offering, when available, may also be obtained from Maxim Group LLC, 300 Park Avenue, 16th Floor, New York, New York 10022, Attention: Syndicate Department, by telephone at (212) 895-3745 or by email at syndicate@maximgrp.com.

This press release shall not constitute an offer to sell or a 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 other jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or other jurisdiction.

About MGO Global Inc.

MGO Global is actively engaged in building a portfolio of independent, digitally native, lifestyle brands, which are unique and differentiated, yet all defined by distinctive, high-quality products and a shared commitment to delivering high-touch customer experiences across its ecommerce and wholesale channels. MGO is currently comprised of two business units: Americana Liberty, which markets a growing, high-end line of thoughtfully curated home and outdoor products, including Stand Flagpoles; and MGO Digital, which leverages data analytics, advanced technology-enabled marketing and our leadership's industry relationships and expertise to identify, incubate and introduce to market new, authentic lifestyle brand concepts. For more information on MGO, please visit www.mgoglobalinc.com.

Cautionary Note Regarding Forward-Looking Statements

This press release may contain forward-looking statements that are subject to various risks and uncertainties. Such statements include statements regarding the Company's ability to complete the proposed business combination with Heidmar, Inc., grow its businesses, statements regarding the consummation of the offering, the satisfaction of closing conditions and the use of proceeds from the offering and other statements that are not historical facts, including statements which may be accompanied by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential" or similar words. Actual results could differ materially from those described in these forward-looking statements due to certain factors, including without limitation, the Company's ability to achieve profitable operations, customer acceptance of new products, and future measures taken by authorities in the countries wherein the Company has supply chain partners, the demand for the Company's products and the Company's customers' economic condition, the impact of competitive products and pricing, general economic conditions and other risk factors detailed in the Company's filings with the United States Securities and Exchange Commission, including but not limited to the Company's Annual Report on Form 10-K for 2023 fiscal year. The forward-looking statements contained in this press release are made as of the date of this press release, and the Company does not undertake any responsibility to update the forward-looking statements in this release, except in accordance with applicable law.

CONTACT INFORMATION:

MGO Global Inc.

Dodi Handy, Director of Communications
Telephone: 407-960-4636
Email: ir@mgoteam.com

SOURCE: MGO Global

View the original press release on accesswire.com

FAQ

What are the terms of MGO Global's (MGOL) December 2024 public offering?

MGO Global's public offering consists of 6,315,000 units priced at $0.95 per unit, with each unit containing one share of common stock (or pre-funded warrant) and one warrant exercisable at $1.425 per share.

How much money did MGOL raise in its December 2024 public offering?

MGO Global raised $6.0 million in gross proceeds before deducting placement agent's fees and other offering expenses.

When will the warrants from MGOL's December 2024 offering become exercisable?

The warrants will become exercisable only after stockholder approval and notice is provided, with an exercise price of $1.425 per share.

What is the expiration timeline for MGOL's December 2024 offering warrants?

The warrants will expire either five years from the initial exercise date or upon the closing of MGO's business combination with Heidmar, Inc., whichever comes first.

What are the cashless exercise terms for MGOL's December 2024 warrants?

Warrant holders can exercise on an alternative cashless basis, exchanging each warrant for two shares of common stock.