FREMONT, Calif. - Actelis Networks, Inc. (NASDAQ:ASNS), a provider of networking solutions for IoT applications, has entered into a definitive agreement to exercise Series A-2 warrants for approximately 999,670 shares of common stock at $2.00 per share. The transaction is expected to generate gross proceeds of around $2.25 million before deducting fees and estimated offering expenses, with H.C. Wainwright & Co. serving as the exclusive placement agent.
The exercised warrants were originally issued in June 2024 and are part of a registered offering. In addition to the exercise of these warrants, Actelis will issue new unregistered warrants for the purchase of up to 1,999,340 shares at an exercise price of $1.75 per share. These warrants will be immediately exercisable and valid for twenty-four months from the date of issuance.
The company anticipates closing the offering on or about July 2, 2024, subject to customary closing conditions. The proceeds from this exercise are intended for general corporate purposes, including working capital.
The new warrants were offered in a private placement under an exemption from the registration requirements of the Securities Act of 1933. The shares issuable upon their exercise have not been registered under the Act and cannot be sold in the U.S. without registration with the SEC or an applicable exemption from such requirements.
Actelis Networks specializes in cyber-hardened, rapid-deployment networking solutions for a variety of applications, including government, transportation, military, utility, telecom, and campus networks. The company's portfolio includes hybrid fiber, hardened aggregation switches, Ethernet devices, management software, and cybersecurity capabilities.
In other recent news, Actelis Networks, renowned for its cyber-hardened networking solutions, has been making significant strides in its operations. The company has secured an order for a smart city network project in a significant German city, marking its continued expansion into smart city infrastructure. Actelis Networks has also secured a $300k order for an Italian transport project, further expanding its global footprint and success in the transportation sector.
The company has announced a partnership with Carahsoft Technology Corp. for public sector distribution in the United States and Canada, enabling Actelis to distribute its hybrid-fiber connectivity solutions to federal, state, local, and educational agencies.
Additionally, Actelis Networks has initiated an immediate exercise of outstanding warrants, projected to generate approximately $3 million in gross proceeds for general corporate purposes.
Actelis Networks has also received orders for its cyber-hardened technology to be implemented at three U.S. military bases, following recent cybersecurity certifications. This marks a significant advancement in the company's growth within the military network ecosystem.
Lastly, Actelis Networks plans to acquire a majority stake in Quality Industrial Corporation, a Dubai-based company specializing in industrial and energy solutions. This merger is anticipated to create a combined entity with a proforma revenue of $17 million in 2023.
InvestingPro Insights
As Actelis Networks, Inc. (NASDAQ:ASNS) moves forward with its strategic financial maneuvers, the recent performance and financial health of the company come into focus. According to InvestingPro data, Actelis Networks has a market capitalization of $11.57 million and has experienced significant volatility with a price uptick of 106.25% over the last six months, which may attract investors looking for high-growth opportunities.
The InvestingPro Tips highlight that despite the company's strong return over the last three months, with a 124.27% increase, it is quickly burning through cash and its short-term obligations exceed its liquid assets. This could raise concerns about the company's liquidity and its ability to sustain operations without further financing. Additionally, the company's valuation implies a poor free cash flow yield, and it has not been profitable over the last twelve months, which may warrant caution among potential investors.
It's also worth noting that Actelis Networks does not pay a dividend to shareholders, which could influence the investment decisions of those seeking regular income streams. With the company's next earnings date slated for August 9, 2024, investors will be keenly watching for signs of improvement in financial performance.
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