KELOWNA, BC - Lexaria Bioscience Corp. (NASDAQ:LEXX)(NASDAQ:LEXXW), a leader in drug delivery platforms, has announced the successful exercise of warrants by an accredited investor, leading to gross proceeds of approximately $4.7 million.
This financial move involves the full exercise of existing warrants for 2,917,032 shares of common stock, with 1,618,330 warrants at $0.97 per share and 1,298,702 at $2.185 per share, leaving no warrants remaining at $0.97 and 259,741 at $2.185 unexercised.
In return for the early exercise of the warrants, Lexaria is issuing 2,917,032 new warrants at an exercise price of $4.75 per share, which are immediately exercisable and set to expire on February 16, 2029.
The company's CEO, Chris Bunka, expressed that the capital raised will extend the company's operational runway into 2025 and support aggressive execution of their plans for 2024. He also noted the exercise price of the new warrants as a sign of investor confidence in Lexaria's future.
The new warrants are part of a private placement under specific sections of the Securities Act of 1933 and are not registered under the Act or any state securities laws. Consequently, they may not be sold in the U.S. without registration or an exemption from registration requirements. Lexaria has committed to file a registration statement for the resale of the common stock underlying the new warrants.
As part of the agreement, Lexaria is obligated to provide H.C. Wainwright with 6% of the cash proceeds from the warrant exercises and issuance, and to issue 102,097 additional warrants with similar terms at an exercise price of $5.9375 per share.
The net proceeds from this transaction are intended for working capital and general corporate purposes. This press release does not constitute an offer to sell or a solicitation of an offer to buy these securities and is based on a press release statement.
Lexaria's patented DehydraTECH technology improves the delivery of active pharmaceutical ingredients (APIs) into the bloodstream and potentially across the blood-brain barrier. The company has a substantial intellectual property portfolio and continues to explore the capabilities of its technology in various formats.
InvestingPro Insights
Lexaria Bioscience Corp. is navigating a dynamic financial landscape, as evidenced by its recent warrant exercise transaction. To provide a clearer picture of the company's financial health and market performance, here are some key metrics and insights from InvestingPro:
- The company boasts a healthy liquidity position, with liquid assets exceeding short-term obligations and holding more cash than debt on its balance sheet.
- Despite a challenging environment, analysts have a positive outlook for Lexaria, anticipating sales growth in the current year.
- Market performance shows a significant return over the last week of 9.82%, coupled with a strong return over the last three months of 65.1%.
InvestingPro Tips indicate that while Lexaria is quickly burning through cash, it has been able to generate a large price uptick over the last six months. Still, analysts do not expect the company to be profitable this year, and the stock has fared poorly over the last month with a -32.23% return.
These tips, along with many more, are available on InvestingPro, which offers a comprehensive analysis of companies like Lexaria. For those interested in a deeper dive, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription. There are 11 additional InvestingPro Tips listed on the platform, providing valuable insights for investors considering Lexaria.
With a market capitalization of $38.91 million and a negative P/E ratio, Lexaria's financials reflect its current growth phase and the speculative nature of its market success. The company's revenue for the last twelve months as of Q2 2024 stands at $0.4 million, with a notable revenue growth of 23.16%. It's important for investors to consider these figures when evaluating the company's potential and the risks involved.
As Lexaria continues to advance its DehydraTECH technology and expand its intellectual property portfolio, keeping an eye on these financial metrics and expert analyses will be crucial for stakeholders and potential investors.
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