By Stephanie N. Rotondo
Seattle, Aug. 23 – Precipio Inc. sold $6 million of units containing one series B convertible preferred stock share and one warrant exercisable for common stock, the company said in a press release on Wednesday.
Aegis Capital Corp. is the bookrunner.
There is a 15% over-allotment option.
The units will be sold at $1,000 apiece.
The $1,000-par series B convertible preferreds are convertible into 400 common shares at any time. The conversion price is $2.50 a share, a 178% discount compared to Tuesday’s closing share price of $4.47.
Dividends are payable to the extent dividends are paid on the underlying stock. Precipio does not currently intend to pay dividends on its common stock.
The warrants are exercisable for 400 common shares for five years at a strike price of $3.00 a share.
Additionally, the company issued underwriter warrants equal to 2.5% of the shares issuable upon conversion of the preferreds, according to an 8-K filed with the Securities and Exchange Commission. The strike price for those warrants is $3.125 a share.
In connection with the offering, holders of the company’s series A convertible preferred stock have orally agreed to convert their holdings on a one-for-one basis. Those holders will also receive additional warrants equal to one-half share of common stock.
The exercise price is $10.00 a share.
Once the deal closes, approximately $800,000 of the company’s convertible promissory notes will convert into series A convertible preferreds at a conversion price of $3.736329 a share. Once converted, those holders have also agreed to convert their new preferreds into common stock on a one-for-one basis.
The strike price is $3.00 a share.
The New Haven, Conn.-based cancer diagnostics reference laboratory plans to use proceeds to grow the company’s sales force, for the progression of product development and for working capital and other general corporate purposes.
| Issuer: | Precipio Inc.
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| Securities: | Units holding one series B convertible preferred share and one warrant
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| Amount: | $6 million
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| Bookrunner: | Aegis Capital Corp.
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| Price: | $1,000 per unit
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| Series B convertible preferred stock
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| Conversion price: | $2.50 a share
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| Conversion rate: | 400 shares
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| Conversion discount: | 178%
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| Warrants
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| Maturity: | 5 years
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| Strike price: | $3.00
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| Exercise rate: | 400 shares per unit
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| Pricing date: | Aug. 23
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| Settlement date: | Aug. 28
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| Stock symbol: | Nasdaq: PRPO
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| Stock price: | $4.47 as of Aug. 22 close
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| Market capitalization: | $15.86 million
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