Castellum Announces Pricing of $5.0 Million Public Offering of Common Stock and Warrants

Rhea-AI Summary

Castellum (NYSE-American: CTM), a cybersecurity and federal government services company, has announced pricing for its $5.0 million public offering. The company is offering 4,166,667 Units at $1.20 per Unit, with each unit comprising one common stock share and one warrant. The warrants will be exercisable immediately at $1.22 per share with a 60-day expiration period. Maxim Group LLC serves as the sole placement agent for the offering, which is expected to close around June 13, 2025. The net proceeds will be used for working capital and general corporate purposes. The offering is conducted under a previously filed shelf registration statement that became effective on January 24, 2025.

Positive

• The offering provides $5.0 million in additional capital for working capital and corporate purposes
• Warrants are immediately exercisable, providing quick potential for additional capital

Negative

• The offering will cause immediate dilution for existing shareholders
• Short 60-day warrant exercise period may create selling pressure
• The offering price of $1.20 per unit may represent a discount to market price

Insights

Financial Analyst

Castellum raising $5M through dilutive offering with unusually short-term warrants suggests immediate capital needs despite generic use declaration.

Castellum has priced a $5.0 million public offering consisting of 4,166,667 units at $1.20 per unit. Each unit contains one common share and one warrant exercisable at $1.22 with an extremely short 60-day expiration window. This structure reveals several important insights for investors.

The unit pricing mechanism is notable here - with the exercise price just 1.7% above the unit price, there's minimal premium being captured if warrants are exercised. This suggests limited pricing power during negotiations with Maxim Group, the placement agent working on a "reasonable best-efforts" basis rather than a firm commitment underwriting.

The unusually abbreviated 60-day warrant expiration is particularly significant. Most public company warrants have terms measured in years, not days. This compressed timeframe creates urgency for warrant holders to make decisions quickly and suggests Castellum is seeking to potentially secure additional capital beyond the initial $5M in the near term.

The vague designation of proceeds for "working capital and general corporate purposes" provides limited transparency into specific capital allocation plans. For a company in the competitive federal cybersecurity and electronic warfare space, this generic language doesn't signal specific growth initiatives or strategic investments.

If all warrants are exercised, Castellum would issue a total of 8,333,334 new shares. Without knowing the current outstanding share count, investors should recognize this potentially represents significant dilution that could impact earnings per share and ownership percentages of existing shareholders.

VIENNA, Va., June 12, 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 pricing of its public offering of 4,166,667 Units at a public offering price of $1.20 per Unit. Each unit consists of one share of common stock and one warrant to purchase one share of common stock. The warrants will be immediately exercisable at $1.22 per share and will expire 60 days from the date of issuance. The shares of common stock and warrants are immediately separable and will be issued separately.

Gross proceeds from the offering are expected to be approximately $5.0 million before deducting placement agent fees and estimated offering expenses. Castellum intends to use the net proceeds of the offering for working capital and general corporate purposes.

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

The closing of the offering is expected to occur on or about June 13, 2025, subject to satisfaction of customary closing conditions.

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 are being 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 will be filed with the SEC and will be available on the SEC’s website at www.sec.gov. When available, 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. Before you invest, you should read the preliminary prospectus supplement and accompanying prospectus, together with the information incorporated by reference therein, for more complete information about the Company and the proposed offering. The final terms of the offering will be disclosed in a final prospectus supplement to be filed with the SEC.

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. (NYSE-American: CTM):

Castellum, Inc. (NYSE-American: CTM) is a cybersecurity, electronic warfare, and software engineering services company focused on the federal government - https://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, operating under a prolonged continuing resolution, government shutdown, or breach of the debt ceiling, as well as the imposition by the U.S. government of sequestration in the absence of an approved budget; the ability of the U.S. federal government to unilaterally cancel a contract with or without cause, and more specifically, the potential impact of the U.S. DOGE Service Temporary Organization on government spending and terminating contracts for convenience. 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
https://castellumus.com

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/16bcd0fd-ec04-4e10-8493-96c88cbc83a3

FAQ

What is the size and price of Castellum's (CTM) public offering?

Castellum is offering 4,166,667 Units at $1.20 per Unit, totaling approximately $5.0 million in gross proceeds.

What are the terms of CTM's warrants in the June 2025 offering?

Each warrant is immediately exercisable at $1.22 per share and will expire 60 days from issuance.

How does Castellum plan to use the proceeds from its 2025 offering?

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

Who is the placement agent for Castellum's 2025 public offering?

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

When is the expected closing date for CTM's public offering?

The offering is expected to close on or about June 13, 2025, subject to customary closing conditions.