Castellum Announces Closing of $4.5 Million Public Offering of Common Stock and Warrants

Rhea-AI Summary

Castellum (NYSE-American: CTM) has completed its previously announced public offering, raising $4.5 million through the sale of 4,500,000 Units at $1.00 per Unit. Each unit comprises one common stock share and one warrant, with warrants exercisable at $1.08 per share within 60 days of issuance.

The offering, conducted under a shelf registration statement on Form S-3, was managed by Maxim Group as the sole placement agent. The company plans to utilize the net proceeds for working capital and general corporate purposes. The securities were offered through a prospectus, with documentation available on the SEC's website.

Positive

• Successful completion of $4.5M capital raise
• Warrants provide potential additional capital if exercised at $1.08 per share

Negative

• Potential dilution from 4.5M new shares issued
• Additional dilution possible if warrants are exercised
• Short 60-day warrant exercise window suggests urgent capital needs

Insights

Financial Analyst

Castellum's $4.5 million public offering represents a strategic financing event that deserves careful analysis regarding its structure and implications. The company sold 4,500,000 Units at $1.00 per Unit, with each unit containing one common share and one warrant exercisable at $1.08 with a 60-day expiration window.

The offering pricing at $1.00 represents approximately an 11.5% discount to the current trading price of $1.13, which is significant. This will result in immediate dilution for existing shareholders as the share count increases. Additionally, the company faces potential further dilution if the warrants are exercised within their short 60-day window.

Given Castellum's market capitalization of approximately $89.2 million, this offering represents roughly 5% of the company's market value. The company stated it intends to use proceeds for "working capital and general corporate purposes" without specifying particular strategic initiatives or investments.

The transaction structure is also noteworthy - Maxim Group served as placement agent on a "reasonable best-efforts" basis rather than through a firm commitment underwriting. This distinction indicates the offering was conducted without the underwriter purchasing the securities outright.

While the capital infusion strengthens Castellum's immediate financial position, the dilutive nature of the offering at a discounted price creates a modestly negative impact for existing shareholders in the near term. The value this additional capital will generate for the company depends entirely on management's allocation decisions, which remain unspecified in the announcement.

VIENNA, Va., March 19, 2025 (GLOBE NEWSWIRE) -- Castellum, Inc. (the “Company” and “Castellum”) (NYSE-American: CTM), a cybersecurity, electronic warfare, and software services company focused on the federal government, today announced the closing of its previously announced public offering of 4,500,000 Units at a public offering price of $1.00 per Unit. Each unit consisted of one share of common stock and one warrant to purchase one share of common stock. The warrants are immediately exercisable at $1.08 per share and will expire 60 days from the date of issuance. The shares of common stock and warrants are immediately separable and were issued separately.

Gross proceeds from the offering were approximately $4.5 million before deducting placement agent fees and offering expenses. Castellum intends to use the net proceeds of the offering for working capital and general corporate purposes.

Maxim Group LLC acted as the sole placement agent, on a reasonable best-efforts basis for the offering.

A shelf registration statement on Form S-3 (File No. 333-284205) relating to the securities being offered was previously filed with the U.S. Securities and Exchange Commission (the “SEC”) and became effective on January 24, 2025. The shares of common stock and shares underlying the warrants were offered only by means of a prospectus. A preliminary prospectus supplement and the accompanying prospectus relating to and describing the terms of the public offering have been filed with the SEC. A final prospectus supplement and an accompanying prospectus relating to the offering has been filed with the SEC and is available on the SEC’s website at www.sec.gov. Copies of the final prospectus supplement and accompanying prospectus relating to the public offering may be obtained by contacting Maxim Group LLC, at 300 Park Avenue, 16th Floor, New York, NY 10022, Attention: Prospectus Department, or by telephone at (212) 895-3745 or by email at syndicate@maximgrp.com.

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

About Castellum, Inc.

Castellum, Inc. (NYSE-American: CTM) is a defense-oriented technology company that is executing strategic acquisitions in the cybersecurity, MBSE, and information warfare areas - http://castellumus.com/.

Forward-Looking Statements:

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All forward-looking statements are inherently uncertain, based on current expectations and assumptions concerning future events or future performance of the company. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. Words such as “will,” “would,” “believe,” and “expects,” and similar language or phrasing are indicative of forward-looking statements. These forward-looking statements are subject to risks, uncertainties, and other factors, many of which are outside of the Company’s control, that could cause actual results to differ (sometimes materially) from the results expressed or implied in the forward-looking statements, including, among others: the Company’s ability to close the described equity financing; its ability to effectively integrate and grow its acquired companies; its ability to identify additional acquisition targets and close additional acquisitions; the impact on the Company’s revenue due to a delay in the U.S. Congress approving a federal budget; and the Company’s ability to maintain the listing of its common stock on the NYSE American LLC. In evaluating such statements, prospective investors should review carefully various risks and uncertainties identified in Item 1A. “Risk Factors” section of the Company’s recently filed Form 10-Q, Item 1A. "Risk Factors” in the Company’s most recent Form 10-K, and other filings with the Securities and Exchange Commission which can be viewed at www.sec.gov. These risks and uncertainties, or not closing the described potential equity financing in this press release, could cause the Company's actual results to differ materially from those indicated in the forward-looking statements. Except to the extent required by law, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, a change in events, conditions, circumstances or assumptions underlying such statements, or otherwise.

Contact:

Glen Ives
President and Chief Executive Officer
Phone: (703) 752-6157
Info@castellumus.com

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/a0792b57-251a-4b24-8adf-09fcf21736c1

FAQ

What are the key terms of Castellum's (CTM) March 2025 public offering?

Castellum offered 4.5M Units at $1.00 each, with each unit containing one common stock share and one warrant exercisable at $1.08, expiring in 60 days.

How much capital did Castellum (CTM) raise in its March 2025 offering?

Castellum raised $4.5 million in gross proceeds before deducting placement agent fees and offering expenses.

What is the exercise price and expiration of CTM's warrants from the March 2025 offering?

The warrants are exercisable at $1.08 per share and expire 60 days from the March 19, 2025 issuance date.

How will Castellum (CTM) use the proceeds from its March 2025 offering?

Castellum intends to use the net proceeds for working capital and general corporate purposes.