Safe & Green Holdings Corp. Announces Pricing of Approximately $8.0 Million Private Placement

Rhea-AI Summary

Safe & Green Holdings (NASDAQ: SGBX) has announced the pricing of a private placement offering expected to raise approximately $8.0 million in gross proceeds. The offering comprises 20,408,160 Common Units priced at $0.392 per unit (or $0.3919 for Pre-Funded Units).

Each unit consists of one share of Common Stock (or Pre-Funded Warrant), one Series A Warrant exercisable at $0.784 with a 60-month term, and one Series B Warrant exercisable at $0.98 with a 30-month term. Both warrant series will become exercisable following stockholder approval.

The company plans to use the net proceeds for working capital, general corporate purposes, and equipment for expansion. D. Boral Capital is serving as the Exclusive Placement Agent, with the transaction expected to close around April 14, 2025.

Positive

• Secured $8.0 million in additional funding for operations and expansion
• Structured offering provides flexibility with both common stock and warrant options

Negative

• Significant potential dilution with over 20.4 million new units being offered
• Offering price of $0.392 per unit indicates a substantial discount to market
• Additional dilution possible through warrant exercises

Insights

Financial Analyst

Safe & Green Holdings' $8 million private placement represents a significant capital injection for a company with just a $2.2 million market capitalization, effectively quadrupling its capital base. The transaction structure reveals important insights about both the company's current position and future prospects.

The units priced at $0.392 mirror the current share price, indicating the company wasn't forced to offer a discount despite its micro-cap status. However, the issuance of 20.4 million units creates substantial dilution for existing shareholders, dramatically expanding the share count. The warrant structure with exercise prices at $0.784 and $0.98 requires share price appreciation of 100% and 150% respectively to become valuable, suggesting investor optimism about potential upside.

This financing appears necessary for SGBX's operational continuity and growth initiatives, with proceeds earmarked for working capital and equipment expansion. For modular construction companies, capital equipment represents a critical path to increased production capacity and improved margins. The successful raise demonstrates investor confidence in management's ability to deploy this capital productively.

For existing shareholders, while the dilution is substantial, the alternative of inadequate working capital would likely prove more detrimental. The warrant exercise prices establish clear targets for management to deliver value, creating alignment between new investors and corporate performance goals. The transaction strikes a reasonable balance between addressing immediate capital needs and setting performance benchmarks for long-term value creation.

MIAMI, April 14, 2025 (GLOBE NEWSWIRE) -- Safe & Green Holdings Corp. (NASDAQ: SGBX) ("Safe & Green Holdings" or the "Company"), a leading developer, designer, and fabricator of modular structures, today announced the pricing of a Private Placement with gross proceeds to the Company expected to be approximately $8.0 million.

The offering consists of 20,408,160 Common Units (or Pre-Funded Units), each consisting of (i) one (1) share of Common Stock or one (1) Pre-Funded Warrant, (ii) one (1) Series A Registered Common Warrant to purchase one (1) share of Common Stock per warrant at an exercise price of $0.784 (the “Series A Warrants”) and (iii) one (1) Series B Registered Common Warrant to purchase one (1) share of Common Stock per warrant at an exercise price of $0.98 (the “Series B Warrants” and together with the Series A Warrants, the “Warrants”). The public offering price per Common Unit is $0.392 (or $0.3919 for each Pre-Funded Unit, which is equal to the public offering price per Common Unit to be sold in the offering minus an exercise price of $0.0001 per Pre-Funded Warrant). The Pre-Funded Warrants will be immediately exercisable and may be exercised at any time until exercised in full. For each Pre-Funded Unit sold in the offering, the number of Common Units in the offering will be decreased on a one-for-one basis. The initial exercise price of each Series A Warrant is $0.784 per share of Common Stock. The Series A Warrants are exercisable following stockholder approval and expire sixty (60) months thereafter. The number of securities issuable under the Series A Warrants is subject to adjustment as described in more detail in the report on the Company’s Current Report on Form 8-K to be filed with the SEC in connection with the offering (the “8-K”). The initial exercise price of each Series B Warrant is $0.98 per share of Common Stock or pursuant to an alternative cashless exercise option. The Series B Common Warrants are exercisable following stockholder approval and expire thirty (30) months thereafter. The number of securities issuable under the Series B Warrants is subject to adjustment as described in more detail in the 8-K.

The aggregate gross proceeds to the Company are expected to be approximately $8.0 million, before deducting placement agent discounts and expenses. The transaction is expected to close on or about April 14, 2025, subject to the satisfaction of customary closing conditions. The Company expects to use the net proceeds from the offering, together with its existing cash, for working capital, general corporate purposes and equipment for expansion.

D. Boral Capital is acting as the Exclusive Placement Agent for the Offering. Sichenzia Ross Ference Carmel LLP is acting as counsel to the Company. Lucosky Brookman LLP is acting as counsel to D. Boral Capital.

The securities described above are being sold in a private placement transaction not involving a public offering and have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or applicable state securities laws. Accordingly, the securities may not be reoffered or resold in the United States except pursuant to an effective registration statement or an applicable exemption from the registration requirements of the Securities Act and such applicable state securities laws. The securities were offered only to accredited investors. Pursuant to a registration rights agreement with the investors, the Company has agreed to file one or more registration statements with the SEC covering the resale of the Common Stock and the Shares issuable upon exercise of the Pre-Funded Warrants and Warrants.

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 registration or qualification under the securities laws of any such state or jurisdiction.

About Safe & Green Holdings Corp.

Safe & Green Holdings Corp., a leading modular solutions company, operates under core capabilities which include the development, design, and fabrication of modular structures, meeting the demand for safe and green solutions across various industries. The firm supports third-party and in-house developers, architects, builders, and owners in achieving faster execution, greener construction, and buildings of higher value. For more information, visit https://www.safeandgreenholdings.com/ and follow us at @SGHcorp on Twitter.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains statements that may be deemed “forward-looking statements” within the meaning of U.S. securities laws, including statements regarding clinical trials, expected operations and upcoming developments. All statements in this press release other than statements of historical fact are forward-looking statements. These forward-looking statements may be identified by future verbs, as well as terms such as “expect” “potential,” “anticipating,” “planning” and similar expressions or the negatives thereof. Such statements are based upon certain assumptions and assessments made by management in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate.

Investor Relations:

CORE IR
516 222 2560
investors@safeandgreenholdings.com

FAQ

How much is Safe & Green Holdings (SGBX) raising in their latest private placement?

SGBX is raising approximately $8.0 million in gross proceeds through a private placement of Common Units and Pre-Funded Units.

What is the pricing structure of SGBX's April 2025 private placement?

Common Units are priced at $0.392 per unit, while Pre-Funded Units are priced at $0.3919, with Series A Warrants at $0.784 and Series B Warrants at $0.98.

How will SGBX use the proceeds from the April 2025 private placement?

The proceeds will be used for working capital, general corporate purposes, and equipment for expansion.

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

Series A Warrants expire after 60 months with a $0.784 exercise price, while Series B Warrants expire after 30 months with a $0.98 exercise price.