Decoy Therapeutics, Inc. Announces a Warrant Inducement Transaction for $3.85 Million in Gross Proceeds Priced At-The-Market under Nasdaq Rules

Decoy Therapeutics secures new capital from warrant exercises while issuing additional investor warrants that may add future share overhang.

Rhea-AI Summary

Decoy Therapeutics (DCOY) entered into a warrant inducement agreement expected to generate approximately $3.85 million in gross proceeds.

An existing institutional investor will immediately exercise 1,184,434 Series B Milestone Warrants issued June 29, 2026 at a reduced exercise price of $3.25 per share. In connection with this, the exercise price of Decoy’s outstanding Series A and Series C Milestone Warrants will also be reduced from $5.91 to $3.25 per share. The company plans to use net proceeds for working capital and general corporate purposes.

In consideration for the full exercise, the investor will receive in a private placement New Warrants to purchase up to 2,368,868 shares at $3.25 per share, exercisable after stockholder approval and expiring five years from initial exercise. Closing is expected on or about September 23, 2026, subject to customary conditions.

Positive

• Gross cash proceeds of approximately $3.85 million from immediate warrant exercises
• Exercise of 1,184,434 Series B Milestone Warrants provides near-term funding
• Net proceeds earmarked for working capital and general corporate purposes

Negative

• Issuance of New Warrants for up to 2,368,868 shares creates potential future dilution
• Exercise prices of Series A and C Milestone Warrants cut from $5.91 to $3.25, lowering future capital per share

News Explained

The transaction creates immediate potential dilution from warrant exercise and further contingent dilution if the new warrants become exercisable.

The company has announced an agreement that is not yet closed: the Existing Warrants are to be exercised for 1,184,434 shares, while New Warrants could permit up to 2,368,868 additional shares.

Issuing additional shares increases total share count and reduces an existing holder’s percentage ownership absent offsetting changes; the New Warrants’ ownership effect remains conditional on stockholder approval and exercise.

The New Warrants are being offered in a private placement to a selected investor, and the company has agreed to file a registration statement covering resale of the shares issuable on exercise.

The $3.85 million gross proceeds equal 132.1 days of the last reported quarterly operating cash use, while $8,289,108 of cash and equivalents at June 30, 2026 equal 284.4 days at that same rate.

Sources and calculations

• Decoy Therapeutics warrant inducement transaction release (2026-09-22)
• Dilution definition (2026-07-17)
• Private placement / PIPE definition (2026-07-17)
• Decoy Therapeutics second-quarter 2026 fundamentals (2026Q2)

• Offering gross against the last reported quarterly operating outflow, in days at that rate $3,850,000 / ($2,652,019 / 91) = 132.1 days
• Available liquidity against the last reported quarterly operating outflow, in days at that rate $8,289,108 / ($2,652,019 / 91) = 284.4 days

Argus 15 min delay

+34.57% vs previous close $3.44 last price 2865.0x rel. volume Open Argus

Details

Market reaction after warrant inducement transaction: DCOY +34.57%

+1.4% Peak in 5 min

$2.76 $7.46 Day Range

$2.26M Market Cap

Following this news, DCOY has gained 34.57%, reflecting a significant positive market reaction. Argus tracked a peak move of +1.4% during the session. Our momentum scanner has triggered 125 alerts so far, indicating very high trading interest and price volatility. The stock is currently trading at $3.44. Trading volume is exceptionally heavy at 2865.0x the average, suggesting very strong buying interest.

Data tracked by StockTitan Argus (15 min delayed). Upgrade to Gold for real-time data.

Market Context

The $3.85 million exercise proceeds extended the June 26 private placement, which disclosed up to $2...

Analysis

The $3.85 million exercise proceeds extended the June 26 private placement, which disclosed up to $21 million in potential gross proceeds and milestone warrants; the current transaction reduced exercise prices and issued additional warrants.

Key Figures

Gross proceeds: $3.85 million Existing warrants: 1,184,434 warrants Reduced exercise price: $3.25 per share +5 more

Gross proceeds

$3.85 million

Warrant exercise proceeds before fees and transaction expenses

Existing warrants

1,184,434 warrants

Series B Milestone Warrants exercised immediately

Reduced exercise price

$3.25 per share

Series A, B and C Milestone Warrants

Prior exercise price

$5.91 per share

Series A and C Milestone Warrants before reduction

New warrants

2,368,868 warrants

Private placement warrants issued to the institutional investor

New warrant exercise price

$3.25

New Warrants

New warrant term

Five years

From the initial exercise date

Expected closing

September 23, 2026

Subject to customary closing conditions

Historical Context

1 past event · Latest: Jun 26

1 event

1. Jun 26

   Private placement financing

   24h Move

   +73.8%

   Up to $21 million financing included milestone warrants tied to clinical milestones

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

warrant inducement transaction, private placement, section 4(a)(2), accredited investors

4 terms

warrant inducement transaction financial

"announced its entry into a warrant inducement agreement"

A warrant inducement transaction is when a company issues warrants—options to buy shares at a set price—as a sweetener to persuade investors or creditors to approve a deal, restructuring, or other corporate action. Think of it like giving coupons to convince people to agree to a plan; it can speed approvals but may dilute existing shareholders and change potential future share value, so investors watch these carefully.

private placement financial

"will receive, in a private placement, new unregistered warrants"

A private placement is a sale of securities directly to a selected group of investors, typically institutions or accredited investors, instead of through a public offering. It lets a company raise money faster and with fewer regulatory steps; for existing shareholders it matters because the newly issued shares, often sold at a discount, increase the share count and can dilute their ownership.

section 4(a)(2) regulatory

"pursuant to Section 4(a)(2) of the Securities Act"

Section 4(a)(2) is a part of U.S. securities laws that allows companies to sell their stock directly to certain investors without registering the sale with regulators. This process is often used for private placements, making it easier and faster for companies to raise money from knowledgeable or institutional investors. It matters to investors because it provides an alternative way to buy shares, often with fewer disclosures and lower costs.

accredited investors regulatory

"The securities were offered only to accredited investors"

Accredited investors are individuals or entities considered to have enough financial knowledge and resources to understand and handle more complex and risky investments. They are often allowed to participate in private investment opportunities that are not available to the general public, similar to how experienced players might access exclusive clubs or events. This status helps ensure that investors can manage potential risks and rewards appropriately.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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HOUSTON, Sept. 22, 2026 /PRNewswire/ -- Decoy Therapeutics, Inc. (NASDAQ: DCOY) ("the Company" or "Decoy"), a biotechnology company pioneering Designable Multi-Antivirals (D-MAVs™), a new category of antivirals engineered to target shared viral mechanisms conserved across virus families, today announced its entry into a warrant inducement agreement with an existing institutional investor of the Company for the immediate exercise of the Series B Milestone Warrants to purchase shares of the Company's common stock, for a total of 1,184,434 warrants (the "Existing Warrants"). The Existing Warrants were issued on June 29, 2026 and will be exercised at a reduced exercise price of $3.25 per share. In connection with the transaction, the exercise price of the Company's outstanding Series A Milestone Warrants and Series C Milestone Warrants will also be reduced from $5.91 per share to $3.25 per share. The exercise of the Existing Warrants will result in gross cash proceeds of approximately $3.85 million, before deducting placement agent fees and other transaction expenses. The Company intends to use the net proceeds from the offering for working capital and other general corporate purposes.

In consideration for the immediate exercise in full of the Existing Warrants, the investor will receive, in a private placement, new unregistered warrants to purchase up to 2,368,868 shares of the Company's common stock (the "New Warrants"). The New Warrants will have an exercise price of $3.25 and will be initially exercisable on the date that stockholder approval of the exercise of the New Warrants is obtained. The New Warrants will expire five years from the initial exercise date. The closing of the warrant inducement transaction is expected to occur on or about September 23, 2026, subject to satisfaction of customary closing conditions.

Curvature Securities LLC is acting as the sole placement agent in connection with this warrant inducement transaction.

The New Warrants described above were offered in a private placement pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the "Securities Act") and, along with the common stock issuable upon their exercise, have not been registered under the Securities Act, and may not be offered or sold in the United States absent registration with the SEC or an applicable exemption from such registration requirements. The securities were offered only to accredited investors. The Company has agreed to file a registration statement with the SEC covering the resale of common stock issuable upon exercise of the New Warrants.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy these securities, 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 Decoy Therapeutics
Decoy Therapeutics is a biotechnology company pioneering Designable Multi-Antivirals (D-MAVs), a new category of antivirals engineered to target shared viral mechanisms, enabling a single, adaptable drug to work across multiple viruses. Built on the proprietary IMP³ACT™ platform, which combines AI-assisted design and rapid synthesis, Decoy develops peptide antivirals designed to move faster into the clinic and expand what is possible in viral prevention and treatment. The company's lead candidates target multiple respiratory viruses, addressing the health and societal burden of viral disease.

Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact, including statements regarding Decoy's strategy, preclinical development, regulatory approval pathways (including the FDA Animal Rule), non-dilutive funding, and potential dosing regimens, are forward-looking statements. These statements are based on current management expectations and are subject to risks and uncertainties that could cause actual results to differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.  Actual results could differ materially from those contained in any forward-looking statement as a result of various factors, including, without limitation: the risk that the Company will not obtain sufficient financing to execute on their business plans and risks related to Decoy's products and development plans, including unanticipated issues with any IND application process and the potential of the IMP³ACT™ platform. Readers are urged to carefully review and consider the various disclosures made by the Company in its reports filed with the SEC, including its Annual Report on Form 10-K for the fiscal year ended December 31, 2025, as revised or supplemented by its Quarterly Reports on Form 10-Q and other documents filed with the SEC. If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, Decoy's actual results may vary materially from those expected or projected.

Contacts

Investor Relations
Mark Rosenblun, CFO
mrosenblum@decoytx.com
214-385-0062

Media Relations
Tara Mulloy, TMC Studio
tara@tmc-studio.com
978-855-5219

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SOURCE Decoy Therapeutics, Inc.

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What are the key terms of the New Warrants issued to the institutional investor?

The New Warrants allow the investor to purchase up to 2,368,868 shares of Decoy common stock at an exercise price of $3.25 per share. They will become initially exercisable on the date stockholder approval of their exercise is obtained and will expire five years from that initial exercise date.

When is the warrant inducement transaction expected to close?

The closing of the warrant inducement transaction is expected to occur on or about September 23, 2026, subject to satisfaction of customary closing conditions.

How will the exercise prices of Decoy’s existing milestone warrants change?

The exercise price of the outstanding Series A Milestone Warrants and Series C Milestone Warrants will be reduced from $5.91 per share to $3.25 per share. The 1,184,434 Series B Milestone Warrants being exercised will also use the reduced $3.25 per share exercise price.

Are the New Warrants and underlying shares registered with the SEC?

The New Warrants and the common stock issuable upon their exercise are being offered in a private placement under Section 4(a)(2) of the Securities Act and are not registered. They may not be offered or sold in the United States without registration or an applicable exemption. The company has agreed to file a registration statement with the SEC covering the resale of the common stock issuable upon exercise of the New Warrants.

Who is acting as placement agent for this warrant inducement transaction?

Curvature Securities LLC is acting as the sole placement agent in connection with the warrant inducement transaction.