Phio Pharmaceuticals Announces Exercise of Warrants for $3.1 Million Gross Proceeds
Phio Pharmaceuticals announced the exercise of certain outstanding warrants, securing approximately $3.1 million in gross proceeds. These warrants, originally priced between $324.00 and $9.72 per share, were exercised at a reduced price of $5.45 per share.
The exercise includes the issuance of new unregistered warrants for additional shares, exercisable at $5.45 per share, with varying terms of five and one-half years and eighteen months. H.C. Wainwright & Co. acted as the exclusive placement agent, and the company plans to use the net proceeds for working capital and general corporate purposes.
The offering, expected to close around July 12, 2024, is contingent on customary closing conditions. The new warrants were issued under an exemption from the registration requirements of the 1933 Act and are available only to accredited investors.
- Secured approximately $3.1 million in gross proceeds from warrant exercise.
- New unregistered warrants issued for additional shares at $5.45 per share, providing potential future capital.
- Dilution of existing shareholders due to the issuance of new shares and warrants.
- Reduced exercise price of $5.45 per share compared to original prices, potentially indicating financial strain.
Insights
Phio Pharmaceuticals' recent activity involving the exercise of warrants for
The proceeds are earmarked for working capital and other general corporate purposes, which could include advancing their clinical trials or expanding their operational capabilities. However, the exercise of warrants at a reduced price may signal that the management perceives the current stock price as undervalued. This could be interpreted both positively, as an opportunity for growth, or negatively, questioning the long-term confidence in the share price appreciation.
It’s worth noting that the issuance of new unregistered warrants as part of this exercise introduces additional future dilution risks. These new warrants come with different terms (five and one-half years and eighteen months), which might affect stock volatility depending on when these are exercised. Furthermore, the involvement of H.C. Wainwright & Co. as the exclusive placement agent underscores the importance of having reputable financial advisors in structuring such deals.
For retail investors, understanding the balance between immediate cash inflow and potential future dilution is crucial. This move provides a near-term liquidity boost but carries the long-term risk of diluting existing share value once the new warrants are exercised. Investors should weigh these factors while keeping an eye on how the company plans to utilize the additional funds to drive growth.
The exercise of warrants by Phio Pharmaceuticals also sheds light on market sentiment and investor confidence. The willingness of accredited investors to exercise these warrants at a reduced price indicates their belief in the company's potential despite the lower exercise price. For a clinical-stage company, this kind of financial support is pivotal, as it often translates to vote of confidence in its ongoing projects and future prospects.
However, the fact that the warrants were exercised at a significantly reduced price of
The new unregistered warrants issued in this private placement could lead to further stock dilution, which may impact the stock’s market performance. Investors should monitor the company’s operational milestones and any strategic announcements that could influence the share price and justify the current valuation levels.
In summary, while the immediate financial inflow is beneficial, the market’s reaction to the dilution and the company’s ability to deploy the proceeds effectively will be critical determinants of the long-term impact on the stock price.
Marlborough, Massachusetts--(Newsfile Corp. - July 12, 2024) - Phio Pharmaceuticals Corp. (NASDAQ: PHIO) (the "Company"), a clinical stage biotechnology company whose proprietary INTASYL® siRNA gene silencing technology is designed to make immune cells more effective in killing tumor cells, today announced the entry into definitive agreements to exercise certain outstanding warrants to purchase up to an aggregate of 545,286 shares of common stock of the Company originally issued in February 2020 through December 2023, having exercise prices between
H.C. Wainwright & Co. is acting as the exclusive placement agent for the offering.
In consideration for the immediate exercise of the warrants for cash and the payment of additional
The offering is expected to close on or about July 12, 2024, subject to satisfaction of customary closing conditions. The Company intends to use the net proceeds from the offering for working capital and other general corporate purposes.
The new warrants described above were offered in a private placement pursuant to an applicable exemption from the registration requirements of the 1933 Act and, along with the shares of common stock issuable upon their exercise, have not been registered under the 1933 Act, and may not be offered or sold in the United States absent registration with the SEC or an applicable exemption from such registration requirements. The securities were offered only to accredited investors. The Company has agreed to file a registration statement with the SEC covering the resale of the shares of common stock 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 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.
About Phio Pharmaceuticals Corp.
Phio Pharmaceuticals Corp. (NASDAQ: PHIO) is a clinical stage biotechnology company whose proprietary INTASYL® siRNA gene silencing technology is designed to make immune cells more effective in killing tumor cells. INTASYL is the only self-delivering RNAi technology focused on immuno-oncology therapeutics. INTASYL drugs precisely target specific proteins that reduce the body's ability to fight cancer, without the need for specialized formulations or drug delivery systems.
For additional information, visit the Company's website, www.phiopharma.com.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as "intends," "believes," "anticipates," "indicates," "plans," "expects," "suggests," "may," "would," "should," "potential," "designed to," "will," "ongoing," "estimate," "forecast," "target," "predict," "could" and similar references, although not all forward-looking statements contain these words. Forward-looking statements are neither historical facts nor assurances of future performance and include statements regarding the ability of INTASYL® siRNA gene silencing technology to make immune cells more effective in killing tumor cells, completion of the offering, the satisfaction of customary closing conditions related to the offering and the anticipated use of proceeds therefrom. These statements are based only on our current beliefs, expectations and assumptions and are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results may differ materially from those indicated in the forward-looking statements as a result of a number of important factors, including, but not limited to, those identified in our Annual Report on Form 10-K for the year ended December 31, 2023 and subsequent Quarterly Reports on Form 10-Q under the caption "Risk Factors" and in other filings we periodically makes with the SEC. Readers are urged to review these risk factors and to not act in reliance on any forward-looking statements, as actual results may differ from those contemplated by our forward-looking statements. We do not undertake to update forward-looking statements to reflect a change in our views, events or circumstances that occur after the date of this release, except as required by law.
Contact:
Phio Pharmaceuticals Corp.
ir@phiopharma.com
PR Contact:
Michael Adams
Bridge View Media
adams@bridgeviewmedia.com
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/216275
FAQ
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