Sidus Space Announces Closing of $14 Million Private Placement

Rhea-AI Summary

Sidus Space (NASDAQ: SIDU) has closed a private placement offering, raising approximately $14.1 million from accredited and institutional investors. The offering consisted of units priced at $2.07 each, comprising 6,819,892 shares of Class A common stock (or pre-funded warrants) and warrants to purchase 3,409,946 common shares.

The common warrants have an exercise price of $2.25 per share and are exercisable for five and a half years. Pre-funded warrants can be exercised at $0.0001 per share. ThinkEquity served as the exclusive placement agent. The company plans to use the proceeds for working capital and general corporate purposes.

Positive

• Secured $14.1 million in gross proceeds from private placement
• 5.5-year warrant duration provides long-term funding potential

Negative

• Potential dilution from 6.8M new shares and 3.4M warrant shares
• Warrants priced at $2.25 could pressure stock price

Insights

Financial Analyst

This $14.1 million private placement represents a substantial capital injection for Sidus Space, significantly bolstering their balance sheet. The pricing structure at $2.07 per unit, including warrants exercisable at $2.25, indicates moderate investor confidence despite current market conditions. The warrant coverage ratio of 0.5x is relatively standard for similar deals in the space sector.

The inclusion of pre-funded warrants with a nominal exercise price of $0.0001 is a strategic move that provides immediate access to capital while offering flexibility to institutional investors who may have ownership limitations. The 5.5-year warrant duration provides a lengthy window for potential upside participation.

For a company with a market cap of approximately $41 million, this financing represents about 34% of their current market value. While dilutive to existing shareholders, the capital infusion strengthens their operational runway and ability to execute on their space mission enablement strategy. The involvement of ThinkEquity as placement agent lends credibility to the transaction.

Legal Expert

The private placement's structure under Section 4(a)(2) and/or Regulation D of the Securities Act demonstrates careful consideration of securities law compliance. The commitment to file a resale registration statement provides future liquidity for investors while maintaining the initial private placement exemption integrity.

The careful disclosure language regarding unregistered securities and the explicit limitations on resale reflect proper securities law risk management. The warrant terms, including the extended 5.5-year exercise period, are structured to provide maximum flexibility while remaining within regulatory bounds. The immediate exercisability of the warrants, combined with the registration rights, creates a balanced approach to investor interests and regulatory compliance.

CAPE CANAVERAL, Fla.--(BUSINESS WIRE)-- Sidus Space, Inc. (NASDAQ: SIDU) (the "Company" or "Sidus"), an innovative, agile space mission enabler, today announced the closing of its brokered private placement offering with accredited and institutional investors for the issuance and sale of units consisting of shares of Class A common stock (each a “Common Share”) (or pre-funded warrants (each a “Pre-funded Warrant”) in lieu thereof) together with warrants (each a "Common Warrant") to purchase one-half of the number of Common Shares (or Pre-funded Warrants) of the Company at a price of $2.07 per unit, for aggregate gross proceeds of approximately $14.1 million, before deducting fees and offering expenses.

As part of the offering, the Company issued a combination of 6,819,892 shares of Class A common stock (or Pre-funded Warrants in lieu thereof), and Common Warrants to purchase 3,409,946 Common Shares. Each Pre-funded Warrant entitles the holder to acquire one share of Class A common stock at an exercise price of $0.0001 per share, and each Common Warrant will be immediately exercisable and entitles the holder to acquire one share of Class A common stock at an exercise price of $2.25 per share, for a period of five and one-half years following the closing of the Offering.

The Company intends to use the proceeds from the offering for working capital and general corporate purposes.

ThinkEquity acted as the exclusive placement agent for the Offering.

The securities offered and sold by the Company in the private placement have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or state securities laws and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission (the "SEC") or an applicable exemption from such registration requirements. The Company has agreed to file a registration statement with the SEC covering the resale of the shares of Class A common stock and shares underlying the Pre-funded Warrants and Common Warrants to be issued in the private placement. Any resale of the Company’s shares under such resale registration statement will be made only by means of a prospectus.

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. The securities will not be registered under the Securities Act or any state securities laws when issued at the closing of the private placement, and unless so registered, may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act and applicable state laws.

About Sidus Space, Inc.

Sidus Space (NASDAQ: SIDU) is a space mission enabler providing flexible, cost-effective solutions including custom satellite design, payload hosting, mission management, space manufacturing and AI enhanced space-based sensor data-as-a-service. With its mission of Space Access Reimagined™, Sidus Space is committed to rapid innovation, adaptable and cost-effective solutions, and the optimization of space system and data collection performance. With demonstrated space heritage including manufacturing and operating its own satellite and sensor system, LizzieSat™, Sidus Space serves government, defense, intelligence and commercial companies around the globe. Strategically headquartered on Florida’s Space Coast, Sidus Space operates a 35,000-square-foot space manufacturing, assembly, integration and testing facility and provides easy access to nearby launch facilities.

Forward-Looking Statements

Statements in this press release about future expectations, plans and prospects, as well as any other statements regarding matters that are not historical facts, may constitute ‘forward-looking statements’ within the meaning of The Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, statements relating to the expected trading commencement and closing dates. The words ‘anticipate,’ ‘believe,’ ‘continue,’ ‘could,’ ‘estimate,’ ‘expect,’ ‘intend,’ ‘may,’ ‘plan,’ ‘potential,’ ‘predict,’ ‘project,’ ‘should,’ ‘target,’ ‘will,’ ‘would’ and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: the uncertainties related to market conditions and other factors described more fully in the section entitled ‘Risk Factors’ in Sidus Space’s prospectus and Annual Report on Form 10-K for the year ended December 31, 2023, and other periodic reports filed with the Securities and Exchange Commission. Any forward-looking statements contained in this press release speak only as of the date hereof, and Sidus Space, Inc. specifically disclaims any obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241219826362/en/

Investor Relations

investorrelations@sidusspace.com



Media

press@sidusspace.com

Source: Sidus Space, Inc.

FAQ

How much did Sidus Space (SIDU) raise in their latest private placement?

Sidus Space raised approximately $14.1 million in gross proceeds through their private placement offering.

What is the exercise price of SIDU's common warrants from the 2024 private placement?

The common warrants have an exercise price of $2.25 per share.

How many new shares did SIDU issue in their private placement?

Sidus Space issued 6,819,892 shares of Class A common stock (or pre-funded warrants) and warrants to purchase 3,409,946 additional shares.

What was the unit price for SIDU's private placement offering?

The units in Sidus Space's private placement were priced at $2.07 per unit.

How long are SIDU's common warrants exercisable for?

The common warrants are exercisable for a period of five and one-half years following the closing of the offering.