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Longeveron Raises $4.4 Million in Gross Proceeds from Warrant Exercise Transaction

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Longeveron has raised $4.4 million in gross proceeds from the exercise of existing warrants to purchase 1,697,891 shares of its Class A common stock at $2.35 per share, originally issued in April 2024. The exercise was facilitated by H.C. Wainwright & Co. as the exclusive placement agent. In return, Longeveron has issued new unregistered warrants for 3,395,782 shares, exercisable at $2.50 per share for 24 months. The company plans to use the net proceeds to fund the clinical and regulatory development of Lomecel-B™ for conditions like HLHS and Alzheimer’s, as well as for general corporate purposes. The new warrants were issued in a private placement and are not registered under the Securities Act.

Positive
  • Raised $4.4 million in gross proceeds.
  • Facilitated by H.C. Wainwright & Co., indicating reputable placement agent involvement.
  • New unregistered warrants give potential for future capital at $2.50 per share.
  • Funds to be used for key clinical projects, regulatory approvals, and general corporate purposes.
Negative
  • New warrants issued may cause shareholder dilution.
  • New warrants not registered under the Securities Act, limiting immediate liquidity.

The warrant exercise transaction resulting in $4.4 million in gross proceeds is noteworthy as it directly impacts Longeveron’s liquidity and ability to fund ongoing operations. The issuance of new warrants at an exercise price of $2.50 per share, higher than the previous $2.35, suggests confidence in the stock's potential appreciation. However, the dilution effect on existing shareholders should be considered. With 3,395,782 new shares potentially entering the market, existing shares may experience a downward pressure.

Short-term, the proceeds provide much-needed capital for clinical trials and regulatory efforts, notably for Lomecel-B's development. Long-term, successful deployment of these funds could significantly enhance shareholder value if Lomecel-B demonstrates efficacy in treating conditions such as HLHS and Alzheimer’s.

Investors should also be aware of the private placement's regulatory nuances, which can affect the share’s liquidity and trading conditions. The new warrants, being unregistered, may limit immediate marketability and introduce an element of risk regarding future compliance with the Securities Act.

The injection of capital from warrant exercises highlights investor confidence and strong backing from H.C. Wainwright & Co. This placement agent's involvement is a positive indicator of institutional support, which could bolster market sentiment. The proactive registration of new shares for future resale underlines Longeveron’s strategic planning to manage liquidity and investor accessibility.

Market-wise, the company's focus on diseases with significant unmet needs like HLHS and Alzheimer’s positions it within high-impact and potentially lucrative sectors. However, market acceptance will heavily depend on clinical trial results and forthcoming regulatory milestones.

The immediate exercisability of the new warrants at a higher price point reflects an optimistic forward-looking stance. Nevertheless, the biotech market's inherent volatility and the long timelines for clinical and regulatory processes should temper investor expectations.

MIAMI, June 18, 2024 (GLOBE NEWSWIRE) -- Longeveron Inc. (NASDAQ: LGVN) (“Longeveron” or the “Company”), a clinical stage regenerative medicine biotechnology company developing cellular therapies for rare, life-threatening and chronic aging-related conditions, today announced the closing of its previously announced exercise of certain existing warrants to purchase an aggregate of 1,697,891 shares of its Class A common stock having an exercise price of $2.35 per share, originally issued in April 2024. The resale of the shares of Class A common stock issuable upon exercise of the existing warrants is registered pursuant to an effective registration statement on Form S-1 (File No. 333-278995). The gross proceeds to the Company from the exercise of the existing warrants were approximately $4.4 million, prior to deducting placement agent fees and estimated offering expenses payable by the Company.

H.C. Wainwright & Co. acted as the exclusive placement agent for the offering.

In consideration for the immediate exercise of the existing warrants for cash and the payment of $0.125 per new warrant, the Company issued new unregistered warrants to purchase up to an aggregate of 3,395,782 shares of Class A common stock. The new warrants are immediately exercisable at an exercise price of $2.50 per share and have a term of twenty-four months from the date of issuance.

The Company intends to use the net proceeds from the transaction for its ongoing clinical and regulatory development of Lomecel-B™ for the treatment of several disease states and indications, including HLHS and Alzheimer’s disease, obtaining regulatory approvals, capital expenditures, working capital and other general corporate purposes.

The new warrants described above were offered in a private placement under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and Regulation D promulgated thereunder and, along with the shares of Class A common stock issuable upon exercise of the new warrants, have not been registered under the Securities Act, or applicable state securities laws. Accordingly, the new warrants issued in the private placement and the shares of Class A common stock underlying the new warrants may not be offered or sold in the United States except pursuant to an effective registration statement or an applicable exemption from the registration requirements of the Securities Act and such applicable state securities laws. The Company has agreed to file a registration statement with the Securities and Exchange Commission covering the resale of the shares of Class A common stock issuable upon the exercise of the new warrants.

This press release does 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 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 Longeveron Inc.

Longeveron is a clinical stage biotechnology company developing regenerative medicines to address unmet medical needs. The Company’s lead investigational product is Lomecel-B™, an allogeneic medicinal signaling cell (MSC) therapy product isolated from the bone marrow of young, healthy adult donors. Lomecel-B™ has multiple potential mechanisms of action encompassing pro-vascular, pro-regenerative, anti-inflammatory, and tissue repair and healing effects with broad potential applications across a spectrum of disease areas. Longeveron is currently pursuing three pipeline indications: hypoplastic left heart syndrome (HLHS), Alzheimer’s disease, and Aging-related Frailty. For more information, visit www.longeveron.com or follow Longeveron on LinkedIn, X, and Instagram.

Forward-Looking Statements

Certain statements in this press release that are not historical facts are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, which reflect management’s current expectations, assumptions, and estimates of future operations, performance and economic conditions, and involve risks and uncertainties that could cause actual results to differ materially from those anticipated by the statements made herein. Forward-looking statements are generally identifiable by the use of forward-looking terminology such as “believe,” “expects,” “may,” “looks to,” “will,” “should,” “plan,” “intend,” “on condition,” “target,” “see,” “potential,” “estimates,” “preliminary,” or “anticipates” or the negative thereof or comparable terminology, or by discussion of strategy or goals or other future events, circumstances, or effects and include, but are not limited to, the potential for Lomecel-B™ to be a beneficial treatment for patients with HLHS and include, but are not limited to, the anticipated use of proceeds from the private placement. Factors that could cause actual results to differ materially from those expressed or implied in any forward-looking statements in this release include, but are not limited to, market and other conditions, adverse global conditions, including macroeconomic uncertainty; inability to raise additional capital necessary to continue as a going concern; our history of losses and inability to achieve profitability going forward; the absence of FDA-approved allogenic, cell-based therapies for HLHS or other cardiac-related indications; ethical and other concerns surrounding the use of stem cell therapy or human tissue; our exposure to product liability claims arising from the use of our product candidates or future products in individuals, for which we may not be able to obtain adequate product liability insurance; the adequacy of our trade secret and patent position to protect our product candidates and their uses: others could compete against us more directly, which could harm our business and have a material adverse effect on our business, financial condition, and results of operations; if certain license agreements are terminated, our ability to continue clinical trials and commercially market products could be adversely affected; the inability to protect the confidentiality of our proprietary information, trade secrets, and know-how; third-party claims of intellectual property infringement may prevent or delay our product development efforts; the inability to successfully develop and commercialize our product candidates and obtain the necessary regulatory approvals; we cannot market and sell our product candidates in the U.S. or in other countries if we fail to obtain the necessary regulatory approvals; final marketing approval of our product candidates by the FDA or other regulatory authorities for commercial use may be delayed, limited, or denied, any of which could adversely affect our ability to generate operating revenues; we may not be able to secure and maintain research institutions to conduct our clinical trials; ongoing healthcare legislative and regulatory reform measures may have a material adverse effect on our business and results of operations; if we receive regulatory approval of Lomecel-B™ or any of our other product candidates, we will be subject to ongoing regulatory requirements and continued regulatory review, which may result in significant additional expense; being subject to penalties if we fail to comply with regulatory requirements or experience unanticipated problems with our therapeutic candidates; reliance on third parties to conduct certain aspects of our preclinical studies and clinical trials; interim, “topline” and preliminary data from our clinical trials that we announce or publish from time to time may change as more data become available and are subject to audit and verification procedures that could result in material changes in the final data; provisions in our certificate of incorporation and bylaws and Delaware law might discourage, delay or prevent a change in control of our company or changes in our management and, therefore, depress the market price of our Class A common stock; we have never commercialized a product candidate before and may lack the necessary expertise, personnel and resources to successfully commercialize any products on our own or together with suitable collaborators; and in order to successfully implement our plans and strategies, we will need to grow our organization, and we may experience difficulties in managing this growth. Further information relating to factors that may impact the Company’s results and forward-looking statements are disclosed in the Company’s filings with the Securities and Exchange Commission, including Longeveron’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission on February 27, 2024, as amended by the Annual Report on Form 10-K/A filed March 11, 2024, its Quarterly Reports on Form 10-Q, and its Current Reports on Form 8-K. The forward-looking statements contained in this press release are made as of the date of this press release, and the Company disclaims any intention or obligation, other than imposed by law, to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

Investor Contact
Derek Cole
Investor Relations Advisory Solutions
derek.cole@iradvisory.com


FAQ

How much did Longeveron raise from the warrant exercise transaction?

Longeveron raised $4.4 million in gross proceeds from the warrant exercise transaction.

What is the exercise price for the new warrants issued by Longeveron?

The new warrants issued by Longeveron have an exercise price of $2.50 per share.

What will Longeveron use the proceeds from the warrant exercise for?

Longeveron plans to use the proceeds for the clinical and regulatory development of Lomecel-B™, regulatory approvals, capital expenditures, working capital, and other general corporate purposes.

When were the original warrants that Longeveron exercised issued?

The original warrants were issued in April 2024.

What is the term duration for the new warrants issued by Longeveron?

The new warrants issued by Longeveron have a term of twenty-four months from the date of issuance.

Longeveron Inc.

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