Laser Photonics Announces Warrant Exchange

Rhea-AI Summary

Laser Photonics (NASDAQ:LASE) has announced a warrant exchange agreement to simplify its capital structure. The company will exchange warrants from its August 2024 PIPE financing that had a $4.34 per share exercise price and full ratchet anti-dilution provisions, previously allowing the purchase of 0.8 million shares, for 3.2 million shares of common stock.

CEO Wayne Tupuola stated that this exchange strengthens the company's position to execute strategic growth initiatives, including advancing AI-driven lasers with robotic cells, expanding anti-drone laser systems, and pursuing potential M&A opportunities.

Positive

• Removal of restrictive full ratchet anti-dilution provisions
• Simplification of capital structure
• Enhanced flexibility for strategic growth initiatives and M&A
• Elimination of warrant overhang

Negative

• Significant dilution with issuance of 3.2 million new shares
• 4x increase in share count compared to original warrant coverage

Insights

Financial Analyst

Laser Photonics streamlines capital structure by exchanging restrictive warrants for common stock, reducing dilution risk and enhancing financial flexibility.

Laser Photonics Corporation (NASDAQ: LASE) has executed a strategic financial maneuver by exchanging warrants with problematic full ratchet anti-dilution provisions for common shares. In this transaction, warrant holders are surrendering instruments that would have allowed them to purchase 0.8 million shares at $4.34 per share in exchange for 3.2 million shares of common stock issued directly.

This exchange represents a calculated decision by management to accept immediate dilution in exchange for removing potentially more harmful future dilution scenarios. The full ratchet anti-dilution provision was particularly problematic as it would have automatically reduced the warrants' exercise price if LASE issued equity at lower prices, creating a potential cascade effect on shareholder value.

By proactively addressing this overhang, LASE has gained significant financial flexibility. The simplification of the capital structure removes constraints that likely hampered financing options for growth initiatives. The exchange effectively trades a contingent liability with unpredictable future impact for a known quantity of shares, providing certainty to the market.

The 4:1 exchange ratio (3.2 million shares for warrants to purchase 0.8 million shares) may seem expensive at first glance, but eliminates the risk of potentially unlimited dilution that could have occurred under adverse circumstances with the full ratchet provision. Management clearly viewed this as a necessary cost to create a more stable foundation for executing their strategic plans.

This transaction positions LASE to pursue its growth initiatives from a cleaner financial position, particularly for capital-intensive projects like AI-driven laser systems and anti-drone technologies that may require additional financing in the future.

Transaction Provides Stronger Foundation for Execution of Strategic Growth Initiatives

Deal simplifies capital structure and removes overhang of warrants with full ratchet anti-dilution provision

ORLANDO, FLORIDA / ACCESS Newswire / September 2, 2025 / Laser Photonics Corporation (NASDAQ:LASE) ("LPC" or the "Company"), $LASE, a global leader in industrial laser systems for cleaning and other material processing applications, today announced that it has entered into definitive agreements to exchange certain outstanding warrants issued in the August 2024 PIPE financing. These warrants, which had an exercise price of $4.34 per share and included a full ratchet anti-dilution provision, entitled holders to purchase up to an aggregate of 0.8 million shares of common stock. In exchange for relinquishing these warrants, the warrant holders will receive an aggregate of 3.2 million shares of the Company's common stock.

Wayne Tupuola, Chief Executive Officer, commented:

"We believe that the warrant exchange strengthens our ability to execute on our strategic growth initiatives, including advancing AI-driven lasers with robotic cells, expanding our portfolio of anti-drone laser systems, including our LSAD platform and other anti-drone technologies, and potential M&A. By removing restrictive legacy provisions and streamlining our capital structure, we are better positioned to pursue these opportunities and deliver long-term value to our shareholders."

The shares of common stock described above were offered pursuant to an applicable exemption from the registration requirements of the Securities Act of 1933, as amended.

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 offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or jurisdiction.

About Laser Photonics Corporation

Laser Photonics is a vertically integrated manufacturer and R&D Center of Excellence for industrial laser technologies and systems. Laser Photonics seeks to disrupt the $46 billion, centuries-old sand and abrasives blasting markets, focusing on surface cleaning, rust removal, corrosion control, de-painting and other laser-based industrial applications. Laser Photonics' new generation of leading-edge laser blasting technologies and equipment also addresses the numerous health, safety, environmental and regulatory issues associated with old methods. As a result, Laser Photonics quickly gained a reputation as an industry leader in industrial laser systems with a brand that stands for quality, technology and product innovation. Currently, world-renowned and Fortune 1000 manufacturers in the aviation, aerospace, automotive, defense, energy, maritime, nuclear and space-exploration industries are using Laser Photonics' "unique-to-industry" systems. For more information, visit https://www.laserphotonics.com.

Cautionary Note Concerning Forward-Looking Statements

This press release contains forward-looking statements within the meaning of applicable securities laws. These statements are based on current expectations as of the date of this press release and involve risks and uncertainties that may cause results and uses of proceeds to differ materially from those indicated by these forward-looking statements. We encourage readers to review the "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and other periodic reports we file with Securities and Exchange Commission for a comprehensive understanding. Laser Photonics Corp. undertakes no obligation to revise or update any forward-looking statements, except as required by applicable laws or regulations, to reflect events or circumstances after the date of this press release.

Investor Relations and Media Contact:

Brian Siegel, IRC^®, M.B.A.
Senior Managing Director
Hayden IR
(346) 396-8696
brian@haydenir.com

SOURCE: Laser Photonics Corp.

View the original press release on ACCESS Newswire

FAQ

What is the warrant exchange ratio for LASE's September 2025 transaction?

Laser Photonics is exchanging warrants for 0.8 million shares with a $4.34 exercise price for 3.2 million shares of common stock.

How will the LASE warrant exchange affect shareholders?

The exchange will result in dilution through 3.2 million new shares but removes restrictive anti-dilution provisions and simplifies the capital structure for future growth.

What are Laser Photonics' strategic initiatives following the warrant exchange?

LASE plans to advance AI-driven lasers with robotic cells, expand its anti-drone laser systems including the LSAD platform, and pursue potential M&A opportunities.

When were the original LASE warrants issued?

The original warrants were issued as part of a PIPE financing in August 2024.

What was the exercise price of LASE's exchanged warrants?

The exchanged warrants had an exercise price of $4.34 per share and included full ratchet anti-dilution provisions.