Protagenic Therapeutics Announces Pricing of Private Placement for Aggregate Gross Proceeds of $1.275 Million

Rhea-AI Summary

Protagenic Therapeutics (Nasdaq:PTIX) has announced a private placement offering with expected gross proceeds of $1.275 million. The company will issue 1,948,295 shares of common stock (or pre-funded warrants), along with series A and B warrants to purchase additional shares. The purchase price is set at $0.64 per share ($0.89 for insiders). Series A warrants have an 18-month term while Series B warrants extend to 5 years, both with a $0.64 exercise price. The offering, expected to close by November 4, 2024, will be used for working capital purposes. Brookline Capital Markets is serving as the sole placement agent.

Positive

• Secured $1.275 million in additional funding through private placement
• Insider participation at premium price ($0.89 vs $0.64)

Negative

• Potential dilution from issuance of 1,948,295 shares plus additional shares from warrants
• Further dilution possible if warrants are exercised

Insights

Financial Analyst

This private placement reflects challenging market conditions for small-cap biotech companies. The $1.275 million raise comes at a significant discount, with warrants attached at $0.64 per share, indicating potential dilution concerns. The insider pricing at $0.89 shows management commitment but also highlights the difficulty in attracting external capital at more favorable terms.

The warrant structure, including both 18-month Series A and 5-year Series B warrants, provides additional potential dilution of approximately 3.9 million shares if fully exercised. While the financing provides needed working capital, the terms suggest negotiating leverage and market confidence. The involvement of Brookline Capital Markets as placement agent indicates institutional support, though the small size limits strategic options.

NEW YORK, NY / ACCESSWIRE / October 29, 2024 / Protagenic Therapeutics, Inc. (Nasdaq:PTIX) ("Protagenic Therapeutics" or the "Company"), a leader in biopharmaceutical innovation, announced today it has entered into a purchase agreement (the "Purchase Agreement") for the purchase and sale of an aggregate of 1,948,295 shares of common stock (or pre-funded warrants in lieu of shares of common stock), series A common stock purchase warrants to purchase an aggregate of 1,948,295 shares of common stock, with an exercise price of $0.64 per share, which are exercisable on the trading day immediately following the Stockholder Approval Date (as defined in the Purchase Agreement) for a term of eighteen (18) months from the Stockholder Approval Date (as defined in the Purchase Agreement), and series B common stock purchase warrants to purchase an aggregate of 1,948,295 shares of Common Stock with an exercise price of $0.64 per share, which are exercisable on the trading day immediately following the Stockholder Approval Date for a term of five (5) years from the Stockholder Approval Date. The purchase price of each share of common stock and associated common stock purchase warrants will be $0.64 ($0.89 in the case of insiders).

The closing of the offering is expected to occur on or before November 4, 2024, subject to the satisfaction of customary closing conditions. The gross proceeds from the offering are expected to be approximately $1.275 million, excluding any proceeds that may be received upon exercise of the warrants and before deducting fees and other offering expenses payable by the Company. The Company intends to use the net proceeds from the sale of the securities for working capital purposes.

Brookline Capital Markets, a division of Arcadia Securities, LLC, is acting as sole placement agent for the private placement.

The shares of common stock, the pre-funded warrants and the shares of common stock underlying the pre-funded warrants, the series A common stock warrants and series B common stock warrants to be issued in the private placement and the shares issuable upon exercise of such series A and series B common stock warrants were offered pursuant to an exemption from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act") under Section 4(a)(2) thereof and Regulation D promulgated thereunder and have not been registered under the Securities Act or applicable state securities laws. This press release shall not constitute an offer to sell or the 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 offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Protagenic Therapeutics, Inc.:

Protagenic Therapeutics, Inc. (Nasdaq:PTIX) is committed to pioneering neuro-active peptides into therapeutics to mitigate stress-related disorders. For more information, visit www.protagenic.com.

About PT00114:

PT00114, a 41-amino-acid synthetic peptide, holds promise in treating various neuro-psychiatric conditions, including depression, anxiety, and PTSD. It operates with a novel mechanism, mirroring the active part of the natural brain hormone TCAP, thereby reducing circulating cortisol levels.

Forward-Looking Statements: Statements in this release about future expectations are "forward-looking" and subject to risks and uncertainties. Investors are cautioned against placing undue reliance on such statements.

Company Contact: Alexander K. Arrow, MD, CFA, Chief Financial Officer, Protagenic Therapeutics, Inc. 149 Fifth Ave, Suite 500, New York, NY 10010. Tel: 213-260-4342 Email: alex.arrow@protagenic.com

SOURCE: Protagenic Therapeutics, Inc.

View the original press release on accesswire.com

FAQ

What is the size of Protagenic Therapeutics' (PTIX) October 2024 private placement?

Protagenic Therapeutics announced a private placement with expected gross proceeds of $1.275 million.

What is the purchase price per share in PTIX's 2024 private placement?

The purchase price is $0.64 per share for regular investors and $0.89 per share for insiders.

When will PTIX's private placement close?

The private placement is expected to close on or before November 4, 2024.

What are the terms of the warrants in PTIX's private placement?

Series A warrants have an 18-month term and Series B warrants have a 5-year term, both with an exercise price of $0.64 per share.