Netcapital (NASDAQ: NCPL) stock plunged during pre-market trading Tuesday after the company announced new terms for Series A-2 warrants originally issued in December 2023.
Netcapital (NCPL) has announced the reduction of exercise prices for certain Series A-2 warrants and the issuance of new Series A-3 and A-4 warrants.
The company has amended The Series A-2 warrants, initially issued in December 2023 with an exercise price of $0.25 per share, to a reduced exercise price of $0.155 per share. The exercise price reduction applies to warrants for up to 14,320,000 shares of common stock. Furthermore, Netcapital has adjusted all outstanding Series A-2 warrants to purchase 16,000,000 shares of common stock to the new exercise price.
Netcapital Introduces Series A-3 and A-4 Warrants
Simultaneously, Netcapital is issuing new Series A-3 and A-4 warrants for the same number of shares, both set at the exercise price of $0.155 per share. The Series A-3 warrants will become exercisable upon stockholder approval and remain valid for five years, while the Series A-4 warrants will have an eighteen-month validity period following the same approval.
The company anticipates raising approximately $2.2 million in gross proceeds from the immediate exercise of the adjusted warrants, excluding fees and estimated expenses. The offering, expected to close around May 29, 2024, is subject to customary conditions. Netcapital intends to allocate the net proceeds for general working capital purposes.
H.C. Wainwright & Co. is acting as the exclusive placement agent for this offering. The company offered the new warrants and the shares of common stock issuable upon their exercise in a private placement under an exemption from registration requirements of the Securities Act of 1933. Netcapital has committed to filing a registration statement with the SEC for the resale of the shares of common stock from the new warrants, demonstrating transparency and regulatory compliance.
Netcapital (NASDAQ: NCPL) Stock Reaction
At 09:15 a.m. (Eastern Time) on Tuesday, NCPL stock traded at $0.15, marking a 22.08% decrease compared to the previous trading session.
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