Pulse Biosciences, Inc. Announces Commencement of Rights Offering

Rhea-AI Summary

Pulse Biosciences has commenced a rights offering of up to $60 million in units. Each unit comprises one share of common stock and two warrants to purchase additional shares. The subscription rights, distributed to holders as of May 31, 2024, expire on June 26, 2024. The units are priced at the lesser of $10 per unit or the volume-weighted average price over ten trading days up to the expiration date. The warrants are exercisable immediately and valid for five years. The rights offering includes an over-subscription option, allowing shareholders to buy extra units if available. This offering adheres to the company's SEC registration currently in effect.

Positive

• Pulse Biosciences is raising up to $60 million through a rights offering.
• Shareholders have the opportunity to purchase additional shares at potentially favorable terms.
• The rights offering includes an over-subscription option.
• Warrants are exercisable immediately and valid for five years.
• Units are priced competitively, potentially lower than $10 per unit, based on volume-weighted average price.

Negative

• The subscription rights will expire worthless if not exercised by June 26, 2024.
• The offering might lead to shareholder dilution.
• Companies’ reliance on the successful execution of the rights offering to raise funds.
• The redemption of warrants may only occur after achieving specific stock price targets, which may not be guaranteed.
• Investors might face challenges in promptly paying the exercise price.

Insights

Financial Analyst

Pulse Biosciences has announced a rights offering, aiming to raise up to $60 million. This move indicates a need for capital, likely to fund ongoing development and commercialization of their CellFX technology. For retail investors, there are a few key takeaways. First, the rights offering is non-transferable, meaning if you don't use your rights, you lose them. Second, the pricing mechanism – with a floor price of $10 per unit and a potential adjustment based on market conditions – introduces volatility and uncertainty.

The inclusion of warrants is an added sweetener, providing long-term leverage on the company’s stock. However, it's worth noting that the exercise price of the warrants is set at 110% of the subscription price, which means the stock needs to appreciate significantly for these warrants to be valuable. Additionally, the warrants are subject to redemption if the stock hits certain thresholds for consecutive trading days, potentially limiting upside if the stock performs well.

For short-term investors, dilution is a concern as the issuance of new shares and warrants could depress stock prices. For long-term investors, the additional capital could support growth and value creation, assuming it’s effectively deployed. Carefully examine the company's future prospects, financial health and strategic plan before participating.

Medical Research Analyst

Pulse Biosciences is leveraging its proprietary CellFX® Nanosecond Pulsed Field Ablation™ (nsPFA™) technology, which is innovative in the medical device sector. This technology’s advancement is important for the company’s success. The proceeds from the rights offering are likely to be funneled into further R&D and possibly regulatory clearance processes, which are resource-intensive but critical for market penetration.

Investors should consider the clinical pipeline and the potential applicability of this technology across different medical conditions. The success of this offering hinges on the perceived value and effectiveness of CellFX technology and its ability to meet clinical endpoints and gain regulatory approval. If successful, it could disrupt current treatment modalities and offer a new revenue stream. However, clinical trials and regulatory approvals are inherently uncertain and time-consuming.

HAYWARD, Calif.--(BUSINESS WIRE)-- Pulse Biosciences, Inc. (Nasdaq: PLSE) (the “Company” or “Pulse Biosciences”), a company leveraging its novel and proprietary CellFX® Nanosecond Pulsed Field Ablation™ (nsPFA™) technology, today announced that it has commenced its previously announced rights offering of up to $60,000,000 of units (the “Units,” and each, a “Unit”) at the Initial Price (as defined below). The subscription rights will expire and have no value if they are not exercised prior to 5:00 p.m., Eastern Time, on June 26, 2024 (the “Expiration Date”).

Pursuant to the rights offering, Pulse Biosciences has distributed non-transferable subscription rights to purchase the Units to each holder of the Company’s common stock, par value $0.001 per share (“Common Stock”), as of May 31, 2024. The Company distributed to all holders of Common Stock as of the Record Date non-transferable subscription rights to purchase up to an aggregate of 6,000,000 units (“Units”) at a price per Unit equal to the lesser of: (i) $10 (the “Initial Price”) and (ii) the volume weighted average price of the Common Stock for the ten trading day period through and including the expiration date of the Rights Offering, now contemplated to be Wednesday, June 26, 2024 (the “Alternate Price”). The subscription price will determine the final number of Units issuable, and subsequently the pro rata number of Units to which stockholders can subscribe. To the extent that the Alternate Price is lower than the Initial Price, the Company will sell additional Units, but will not sell fractional Units.

Each Unit consists of one share of Common Stock and two warrants, each being a warrant to purchase one-half of one share of Common Stock at an exercise price per whole share that shall be equal to 110% of the per-Unit subscription price (provided, that, the aggregate number of shares of Common Stock that shall be issuable upon the exercise of each set of warrants included in a given subscription for Units shall be rounded up to the nearest whole share). Each warrant will be exercisable immediately upon completion of the Rights Offering and will expire on the fifth anniversary of the completion of the Rights Offering. The respective warrants will be subject to redemption by the Company for $0.01 per underlying share of Common Stock, on not less than thirty (30) days’ written notice, if the volume weighted average price of our Common Stock equals or exceeds: (i) in respect of one such warrant, 150% of the exercise price for the warrants, subject to adjustment, per whole share, for twenty (20) consecutive trading days, and (ii) in respect of the other such warrant, 200% of the exercise price for the warrants, subject to adjustment, per whole share, for twenty (20) consecutive trading days, provided that, in each case, the Company may not redeem the warrants prior to the date that is three months after the issuance date.

The Rights Offering includes an over-subscription right to permit each rights holder that exercises its basic subscription rights in full to purchase additional Units that remain unsubscribed at the expiration of the offering, but the Company will not sell fractional Units. The availability of this over-subscription right will be subject to certain terms and conditions to be set forth in the offering documents.

Stockholders wishing to exercise subscription rights must timely pay the exercise price for the number of Units they wish to acquire. If the Alternate Price is lower than the Initial Price on the Expiration Date, any excess subscription amounts paid by a subscribing holder will be applied towards the purchase of additional Units in the rights offering. Stockholders who fully exercise their basic subscription rights will be entitled to subscribe for additional Units that are not purchased by other stockholders, on a pro rata basis and subject to availability.

The rights offering is being made pursuant to the Company’s registration statement on Form S-3, as modified by the post-effective amendment filed with the Securities and Exchange Commission (“SEC”) on May 28, 2024, which was deemed effective by the SEC on May 31, 2024, including the prospectus contained therein, as further modified by the prospectus to be filed pursuant to Rule 424(b)(2) of the Securities Act of 1933, which contains the detailed terms of the rights offering and will be filed with the SEC on June 4, 2024. Copies of the foregoing documents may be obtained at the SEC’s website at www.SEC.gov. Questions about the rights offering and requests for copies of the prospectus relating to the rights offering may be directed to Broadridge Corporate Issuer Solutions, LLC, the Company’s information, subscription and warrant agent for the rights offering, at the address and phone number provided at the end of this release.

This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities, nor will there be any sale of securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Pulse Biosciences®

Pulse Biosciences is a novel bioelectric medicine company committed to health innovation that has the potential to improve the quality of life for patients. The Company’s proprietary CellFX® nsPFA™ technology delivers nanosecond pulses of electrical energy to non-thermally clear cells while sparing adjacent noncellular tissue. The Company is actively pursuing the development of its CellFX nsPFA technology for use in the treatment of atrial fibrillation and in a select few other markets where it could have a profound positive impact on healthcare for both patients and providers.

Pulse Biosciences, CellFX, Nano-Pulse Stimulation, NPS, nsPFA, CellFX nsPFA and the stylized logos are among the trademarks and/or registered trademarks of Pulse Biosciences, Inc. in the United States and other countries.

Forward-Looking Statements

All statements in this press release that are not historical are forward-looking statements, including, among other things, statements relating to the effectiveness of the Company’s CellFX nsPFA technology and CellFX System to non-thermally clear cells while sparing adjacent non-cellular tissue, statements concerning the Company’s future fundraising efforts and whether those efforts will be successful or allow the Company to continue current operations as planned, and statements concerning the expected duration and completion of the Company’s 2024 rights offering, and other future events. These statements are not historical facts but rather are based on Pulse Biosciences’ current expectations, estimates, and projections regarding Pulse Biosciences’ business, operations and other similar or related factors. Words such as “may,” “will,” “could,” “would,” “should,” “anticipate,” “predict,” “potential,” “continue,” “expects,” “intends,” “plans,” “projects,” “believes,” “estimates,” and other similar or related expressions are used to identify these forward-looking statements, although not all forward-looking statements contain these words. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties, and assumptions that are difficult or impossible to predict and, in some cases, beyond Pulse Biosciences’ control. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described in Pulse Biosciences’ filings with the Securities and Exchange Commission. Pulse Biosciences undertakes no obligation to revise or update information in this release to reflect events or circumstances in the future, even if new information becomes available.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240604387169/en/

Investors:

Pulse Biosciences, Inc.

Burke T. Barrett, President and CEO

IR@pulsebiosciences.com

Or

Gilmartin Group

Philip Trip Taylor

415.937.5406

philip@gilmartinir.com

Rights Offering Information, Subscription and Warrant Agent:

Broadridge Corporate Issuer Solutions, LLC

Attn: BCIS Re-Organization Dept.

P.O. Box 1317

Brentwood, NY 11717-0718

888.789.8409

shareholder@broadridge.com

Source: Pulse Biosciences, Inc.

FAQ

What is the ticker symbol for Pulse Biosciences?

The ticker symbol for Pulse Biosciences is PLSE.

When do the subscription rights for PLSE expire?

The subscription rights for PLSE expire on June 26, 2024.

What is included in each unit of the PLSE rights offering?

Each unit includes one share of common stock and two warrants to purchase additional shares.

How much is Pulse Biosciences aiming to raise with the rights offering?

Pulse Biosciences aims to raise up to $60 million with the rights offering.

What is the price per unit in the PLSE rights offering?

The price per unit is the lesser of $10 or the volume-weighted average price over the ten trading days up to the expiration date.

What happens if the subscription rights for PLSE are not exercised?

If the subscription rights are not exercised, they will expire and have no value.

Can shareholders buy more units than their initial allocation in the PLSE rights offering?

Yes, shareholders who fully exercise their rights can oversubscribe to buy additional units, subject to availability.

When are the warrants from the PLSE rights offering exercisable?

The warrants are exercisable immediately upon the completion of the rights offering.

For how long are the warrants from the PLSE rights offering valid?

The warrants are valid for five years from the completion of the rights offering.