ENDRA Life Sciences Announces Pricing of $8.0 Million Public Offering
ENDRA Life Sciences (Nasdaq: NDRA) announced the pricing of an $8.0 million public offering. The offering includes 61,538,461 shares of common stock or pre-funded warrants, each paired with Series A and B Warrants. The Series A Warrants have an exercise price of $0.22 per share, while Series B Warrants offer an alternative cashless exercise option. The closing date is expected around June 5, 2024, pending customary conditions. Net proceeds will be used for working capital and general corporate purposes. Craig-Hallum is the sole placement agent. This offering follows an SEC-approved registration statement on Form S-1.
- Gross proceeds of $8.0 million from the public offering.
- Offering includes flexibility with pre-funded warrants and alternative exercise options for Series B Warrants.
- Craig-Hallum acting as sole placement agent adds credibility to the offering.
- Net proceeds intended for working capital and general corporate purposes, indicating growth plans.
- Potential shareholder dilution with the issuance of 61,538,461 shares or pre-funded warrants.
- Series A and B Warrants require shareholder approval and an amendment to the certificate of incorporation, adding procedural uncertainty.
- Best-efforts offering with no minimum sale amount, raising concerns about the final amount raised.
- Series A Warrants expire in five years, and Series B Warrants expire in two and a half years, potentially pressuring stock performance.
Insights
The pricing of ENDRA Life Sciences' $8.0 million public offering indicates a strategic move to secure additional capital for working capital and general corporate purposes. The offering's structure, involving shares of common stock along with Series A and Series B Warrants, provides potential investors with different avenues for future gains and flexibility regarding their investment. The purchase price of $0.13 per share is relatively low, suggesting a possible effort to attract a broad range of investors.
The issuance of Series A and Series B Warrants, which have differing expiry dates, adds complexity to this offering. Series A Warrants expire five years from the initial exercise date, while Series B Warrants expire two and a half years from the initial exercise date. The alternative cashless exercise option for Series B Warrants at a nominal price could entice investors by offering significant upside potential.
However, this move represents a form of dilution, potentially impacting current shareholders unfavorably in the short term. Nonetheless, if the company effectively uses the capital to advance its Thermo Acoustic Enhanced UltraSound (TAEUS®) technology, it might lead to long-term gains. Retail investors should consider both the dilution risk and the company's ability to leverage the new funds effectively.
From a market perspective, ENDRA Life Sciences is leveraging its NASDAQ listing to raise funds, a common strategy for companies seeking to fuel growth without immediate revenue streams. The structure of this offering, especially the inclusion of pre-funded warrants and Series B Warrants' cashless exercise option, suggests an attempt to balance immediate fundraising needs with longer-term investor engagement strategies.
The Thermo Acoustic Enhanced UltraSound (TAEUS®) technology is an innovative product that could disrupt current ultrasound markets, but it requires significant investment to achieve market penetration. The company's decision to allocate proceeds to working capital and general corporate purposes indicates a focus on maintaining operational stability and possibly accelerating product development and market entry.
Retail investors should note the competitive landscape of medical imaging and the significant R&D expenditures associated with such technologies. The potential success of TAEUS® in the market could hinge on regulatory approvals, clinical adoption and the ability to demonstrate clear advantages over existing technologies.
The offering is comprised of 61,538,461 shares of the Company’s common stock (or pre-funded warrants in lieu of shares of common stock). Each share of common stock or pre-funded warrant will be sold with one Series A Warrant to purchase one share of common stock at an exercise price of
The purchase price of each share of common stock and accompanying Warrants is
The Company intends to use the net proceeds from this offering for working capital and general corporate purposes. This offering is expected to close on or about June 5, 2024, subject to satisfaction of customary closing conditions.
Craig-Hallum is acting as sole placement agent for the offering.
The securities described above are being offered by the Company pursuant to a registration statement on Form S-1 (File No. 333-278842) previously filed and declared effective by the Securities and Exchange Commission (the “SEC”). This press release shall not constitute an offer to sell or the solicitation of an offer to buy, 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 the registration or qualification under the securities laws of any such state or jurisdiction. The offering is being made only by means of a written preliminary prospectus and final prospectus that will form a part of the registration statement. A final prospectus relating to the offering will be filed with the SEC and will be available on the SEC’s website at www.sec.gov. Alternatively, when available, copies of the final prospectus relating to this offering may be obtained from Craig-Hallum Capital Group LLC, Attention: Equity Capital Markets, 222 South Ninth Street, Suite 350,
About ENDRA Life Sciences Inc.
ENDRA Life Sciences is the pioneer of Thermo Acoustic Enhanced UltraSound (TAEUS®), a ground-breaking technology that characterizes tissue similar to an MRI, but at 1/40th the cost and at the point of patient care. TAEUS® is designed to work in concert with the more than 700,000 ultrasound systems in use globally today. TAEUS ® is initially focused on the non-invasive assessment of fatty tissue in the liver. Steatotic liver disease (SLD, formerly known as NAFLD-NASH) is a chronic liver disease spectrum that affects over two billion people globally, and for which there are no practical diagnostic tools. Beyond the liver, ENDRA is exploring several other clinical applications of TAEUS®, including non-invasive visualization of tissue temperature during energy-based surgical procedures. For more information, please visit www.endrainc.com.
Forward-Looking Statements
All statements in this press release that are not based on historical fact are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, can generally be identified by the use of terms such as “approximate,” “anticipate,” “attempt,” “believe,” “could,” “estimate,” “expect,” “forecast,” “future,” “goal,” “hope,” “intend,” “may,” “plan,” “possible,” “potential,” “project,” “seek,” “should,” “will,” “would,” or other comparable terms (including the negative of any of the foregoing), although some forward-looking statements are expressed differently. Examples of forward-looking statements for ENDRA include, among others: statements regarding the expected closing of the public offering, the amount of proceeds from the public offering and the intended use of proceeds from the offering; estimates of the timing of future events and anticipated results of our development efforts, including the timing of submission for and receipt of required regulatory approvals and product launches; statements relating to future financial position and projected costs and revenue; expectations concerning ENDRA’s business strategy; and statements regarding ENDRA’s ability to find and maintain development partners. Forward-looking statements involve inherent risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements as a result of various factors including, among others: market and other general economic conditions, which may impact whether we consummate the public offering; whether we will be able to satisfy the conditions required to close any sale of securities in the proposed offering; the fact our management will have broad discretion in the use of the proceeds from any sale of the securities in the proposed offering; the ability to raise additional capital in order to continue as a going concern; the ability to obtain regulatory approvals necessary to sell ENDRA medical devices in certain markets in a timely manner, or at all; the ability to develop a commercially feasible technology and its dependence on third parties to design and manufacture its products; ENDRA’s ability to maintain compliance with Nasdaq listing standards; ENDRA’s dependence on its senior management team; the ability to find and maintain development partners; market acceptance of ENDRA’s technology and the amount and nature of competition in its industry; ENDRA’s ability to protect its intellectual property; and the other risks and uncertainties described in the Risk Factors and Management’s Discussion and Analysis of Financial Condition and Results of Operations sections of the Company’s most recent Annual Report on Form 10-K and in subsequent Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission and the Risk Factors sections of the preliminary prospectus describing the terms of the proposed offering filed with the SEC. You should not rely upon forward-looking statements as predictions of future events. The forward-looking statements made in this press release speak only as of the date of issuance, and ENDRA assumes no obligation to update any such forward-looking statements to reflect actual results or changes in expectations, except as otherwise required by law.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240603362895/en/
Company:
Irina Pestrikova
Senior Director, Finance
investors@endrainc.com
www.endrainc.com
Investor Relations:
Yvonne Briggs
LHA Investor Relations
(310) 691-7100
ybriggs@lhai.com
Source: ENDRA Life Sciences Inc.
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