C3is Inc. Announces Closing of $6.0 Million Underwritten Public Offering

Rhea-AI Summary

C3is Inc. (CISS) announces a public offering generating $6.0 million in gross proceeds. The offering includes Common Units and Pre-Funded Units with various warrants. The net proceeds will be used for capital expenditures, vessel acquisitions, working capital, and general corporate purposes. Aegis Capital Corp. exercised its over-allotment option. The offering was managed by Aegis Capital Corp. and made under an effective registration statement.

Positive

• None.

Negative

• The offering may dilute existing shareholders' ownership due to the issuance of new Common Shares and Warrants.
• The Company still has a significant remaining purchase price for the Aframax tanker acquired in July 2023, which may impact its financial position.
• The Company has not yet identified the vessels it intends to acquire with the proceeds, introducing uncertainty into its future operations.

Financial Analyst

The public offering by C3is Inc. represents a strategic move to raise capital for the company's growth and operational needs. The gross proceeds of $6.0 million, though not substantial for a large-cap company, indicate a targeted approach to funding specific capital expenditures. The company's decision to use the proceeds for payment towards the Aframax tanker and potential acquisitions suggests a focus on expanding its fleet and possibly diversifying its service offerings beyond dry bulk and tanker sectors.

The pricing of the Common Units at $0.05 and Pre-Funded Units at $0.04, below the current market price, could potentially dilute existing shareholders' value. However, it also offers an attractive entry point for new investors. The inclusion of Class C-1 and C-2 Warrants with a five-year expiration and exercise prices set at a premium to the offering price is a common incentive mechanism to encourage investment while providing the company with a potential future capital inflow if the warrants are exercised.

The over-allotment option exercised by Aegis Capital Corp. and the role of Aegis as the sole book-running manager indicate confidence in the offering's success. However, investors should consider the implications of the additional warrants on future earnings per share and the company's ability to meet its capital needs through this offering and subsequent warrant exercises.

Market Research Analyst

The maritime shipping industry is subject to cyclical trends and is influenced by global economic conditions, trade volumes and commodity prices. C3is Inc.'s offering comes at a time when the industry is recovering from disruptions caused by global events and is facing new challenges such as environmental regulations and fuel costs. By raising capital, C3is Inc. is positioning itself to navigate these challenges and potentially capitalize on emerging opportunities.

The choice to potentially diversify into other seaborne transportation sectors could be a strategic hedge against the volatility associated with dry bulk and crude oil markets. However, it also introduces risks related to entering new markets where the company may have less experience. The impact of this strategy on the company's market position and financial performance will be closely watched by investors and industry analysts.

Investors should also monitor the utilization of the net proceeds, as effective deployment in capital expenditures and vessel acquisitions can enhance C3is Inc.'s competitive edge, while any missteps could lead to underperformance relative to peers.

Legal Expert

From a legal standpoint, C3is Inc.'s offering has been conducted in accordance with regulatory requirements, as indicated by the effective registration statement on Form F-1 with the SEC. The company's compliance with securities laws and the involvement of legal counsel, Sichenzia Ross Ference Carmel LLP, for the book-running manager, provides a level of assurance to investors regarding the due diligence of the offering process.

The final prospectus filed with the SEC is a critical document that investors should review to understand the offering's terms, risks and the company's financial position. It also serves as a legal safeguard, ensuring that all material information has been disclosed and reducing the risk of future litigation related to the offering.

While the press release clearly states that the offering is not a solicitation in jurisdictions where it would be unlawful, investors should be aware of the legal implications of investing in securities and the potential for changes in regulations that could affect the company's operations and the value of these securities.

ATHENS, Greece, March 19, 2024 (GLOBE NEWSWIRE) -- C3is Inc. (Nasdaq: CISS) (the “Company”), a ship-owning company providing dry bulk and crude oil tanker seaborne transportation services, today announced the closing of a firm commitment underwritten public offering with gross proceeds to the Company of approximately $6.0 million, before deducting underwriting discounts and other estimated expenses payable by the Company. The offering consisted of 120,000,000 Common Units or Pre-Funded Units, each consisting of one share of common stock (“Common Share”) or Pre-Funded Warrant, one half of a Class C-1 Warrant to purchase one Common Share at an exercise price of $0.075 per share (or 150% of the price of each Common Unit sold in the offering) or pursuant to an alternative cashless exercise option, which warrant will expire on the five-year anniversary of the original issuance date (the "Class C-1 Warrants") and one Class C-2 Warrant to purchase one Common Share at an exercise price of $0.085 per share (or 170% of the price of each Common Unit sold in the offering) which warrant will expire on the five-year anniversary of the original issuance date (the "Class C-2 Warrants" and together with the Class C-1 Warrants, the "Warrants"). The purchase price of each Common Unit was $0.05, and the purchase price of each Pre-Funded Unit was $0.04 (which is equal to the public offering price per Common Unit minus $0.01). The Pre-Funded Warrants are immediately exercisable and may be exercised at any time until all of the Pre-Funded Warrants are exercised in full.

The Company intends to use the net proceeds from this offering for capital expenditures, including for payment towards the $38.7 million remaining purchase price for the Aframax tanker it acquired in July 2023, or acquisitions of additional vessels which it has not yet identified, which may include vessels in seaborne transportation sectors other than the dry bulk and tanker sectors, in which the Company currently operates, working capital, or for other general corporate purposes, or a combination thereof.

In addition, the Company has granted Aegis Capital Corp. (“Aegis”) a 45-day option to purchase up to 15% of the number of Common Shares and/or Pre-Funded Warrants sold in the offering, and/or additional Warrants representing up to 15% of the Warrants sold in the offering solely to cover over-allotments, if any. On March 19, 2024, Aegis exercised its over-allotment exercise with respect to 7,450,000 Class C-1 Warrants and 14,900,000 Class C-2 Warrants.

Aegis Capital Corp. acted as the sole book-running manager for the offering. Sichenzia Ross Ference Carmel LLP served as counsel to the sole book-running manager, Aegis Capital Corp., for the offering.

The offering was made pursuant to an effective registration statement on Form F-1 (No. 333-276868) previously filed with the U.S. Securities and Exchange Commission (the "SEC") on February 23, 2024, as amended, which was declared effective by the SEC on March 14, 2024. A final prospectus describing the terms of the offering has been filed with the SEC and is available on the SEC's website at www.sec.gov. Electronic copies of the final prospectus may be obtained by contacting Aegis Capital Corp., Attention: Syndicate Department, 1345 Avenue of the Americas, 27th floor, New York, NY 10105, by email at syndicate@aegiscap.com, or by telephone at +1 (212) 813-1010.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

ABOUT C3IS INC.

C3is Inc. is a ship-owning company providing dry bulk and crude oil seaborne transportation services. The Company owns three vessels, two handysize dry bulk carriers with a total capacity of 64,000 deadweight tons (dwt) and an Aframax oil tanker with a cargo carrying capacity of approximately 115,800 dwt, resulting with a fleet total capacity of 179,800 dwt. C3is Inc.’s shares of Common Stock are listed on the Nasdaq Capital Market and trade under the symbol “CISS.”

Forward-Looking Statements

Matters discussed in this release may constitute forward-looking statements. Forward-looking statements reflect our current views with respect to future events and financial performance and may include statements concerning the plans, objectives, goals, strategies, future events or performance, or impact and underlying assumptions and other statements, which are other than statements of historical facts. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management’s examination of historical operating trends, data contained in our records and other data available from third parties. Although C3IS INC. believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, C3IS INC. cannot assure you that it will achieve or accomplish these expectations, beliefs or projections. Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include risks discussed in our filings with the SEC and the following: the anticipated use of proceeds from the offering, the strength of world economies and currencies, general market conditions, including changes in charter hire rates and vessel values, charter counterparty performance, changes in demand that may affect attitudes of time charterers to scheduled and unscheduled dry-dockings, shipyard performance, changes in C3IS INC’s operating expenses, including bunker prices, dry-docking and insurance costs, ability to obtain financing and comply with covenants in our financing arrangements, or actions taken by regulatory authorities, potential liability from pending or future litigation, domestic and international political conditions, the conflict in Ukraine and related sanctions and the conflict in Gaza, potential disruption of shipping routes due to ongoing attacks by Houthis in the Red Sea and Gulf of Aden,  accidents and political events or acts by terrorists.

Company Contact:

Nina Pyndiah
Chief Financial Officer
C3is INC.
Tel: 00-30-210-6250-001
e‐mail: info@c3is.pro

FAQ

What is the ticker symbol of C3is Inc. mentioned in the press release?

The ticker symbol of C3is Inc. mentioned in the press release is CISS.

How much was the gross proceeds from the public offering announced by C3is Inc.?

The gross proceeds from the public offering announced by C3is Inc. were approximately $6.0 million.

What will the net proceeds from the offering be used for according to the press release?

The net proceeds from the offering will be used for capital expenditures, vessel acquisitions, working capital, and general corporate purposes.

Which company acted as the sole book-running manager for the offering mentioned in the press release?

Aegis Capital Corp. acted as the sole book-running manager for the offering mentioned in the press release.

What was the effective registration statement used for the offering mentioned in the press release?

The offering was made pursuant to an effective registration statement on Form F-1 (No. 333-276868) previously filed with the U.S. Securities and Exchange Commission (SEC) on February 23, 2024.