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

Rhea-AI Summary

Protagenic Therapeutics (NASDAQ:PTIX) has closed a private placement raising $1.275 million in gross proceeds. The offering included 1,948,295 shares of common stock and two series of warrants. Each series includes 1,948,295 warrants with an exercise price of $0.64 per share. Series A warrants have an 18-month term, while Series B warrants extend for 5 years. The purchase price was set at $0.64 per share ($0.89 for insiders). The company plans to use the proceeds for working capital purposes. Brookline Capital Markets acted as the sole placement agent.

Positive

• Secured immediate working capital through $1.275 million financing
• Insider participation at premium price ($0.89 vs $0.64)
• Long-term warrant structure provides potential for additional future funding

Negative

• Significant dilution through issuance of 1,948,295 new shares
• Additional potential dilution from 3,896,590 warrant shares
• Low offering price indicates weak market position

Insights

Financial Analyst

This $1.275 million private placement, while providing necessary working capital, comes with significant dilutive implications. The deal structure includes common stock and two series of warrants at $0.64 per share, representing potential future dilution of up to 5.8 million shares if all warrants are exercised. The insider pricing premium of $0.89 shows management confidence, but the warrant exercise price suggests upside expectations. For a micro-cap company with $2.7 million market cap, this financing, while necessary for operations, represents substantial dilution risk. The 18-month and 5-year warrant terms create long-term overhang concerns. Critical to watch will be the burn rate and utilization of these funds for meaningful operational progress.

NEW YORK, NY / ACCESSWIRE / November 5, 2024 / Protagenic Therapeutics, Inc. (NASDAQ:PTIX) ("Protagenic Therapeutics" or the "Company"), a leader in biopharmaceutical innovation, announced today that on November 4, 2024 it closed its previously announced private placement pursuant to a purchase agreement (the "Purchase Agreement") for the purchase and sale of an aggregate of 1,948,295 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, 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 was $0.64 ($0.89 in the case of insiders).

The gross proceeds from the offering were 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, acted 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 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

How much did Protagenic Therapeutics (PTIX) raise in its November 2024 private placement?

Protagenic Therapeutics raised gross proceeds of $1.275 million through its private placement closed on November 4, 2024.

What was the share price in PTIX's 2024 private placement?

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

How many warrants were issued in PTIX's November 2024 private placement?

The placement included two series of warrants, each consisting of 1,948,295 warrants, for a total of 3,896,590 warrants.

What is the exercise price of PTIX's 2024 private placement warrants?

Both Series A and Series B warrants have an exercise price of $0.64 per share.