REDMOND, Ore. - Expion360 Inc. (NASDAQ: XPON), known for its lithium-ion battery power storage solutions, has finalized agreements with institutional investors for a registered direct offering and concurrent private placement. The combined transactions are expected to yield approximately $2.6 million in gross proceeds. According to InvestingPro data, the company, currently valued at $5.01M, has been rapidly burning through cash while maintaining negative EBITDA of -$7.56M in the last twelve months.
The company disclosed the sale of 1,048,386 shares of common stock and pre-funded warrants to purchase common stock, each accompanied by a warrant to acquire one common stock share at $2.36 per share. The offering price per share stands at $2.48, while each pre-funded warrant is priced at $2.479, reflecting the share price minus the warrant’s nominal exercise price.
The pre-funded warrants, immediately exercisable, can be exercised anytime until fully utilized. The sale of each pre-funded warrant will correspondingly reduce the number of shares offered. The transactions are scheduled to close around January 3, 2025, contingent upon customary closing conditions.
Expion360 anticipates using the net proceeds, in conjunction with its current cash reserves, for general corporate purposes and working capital. Aegis Capital Corp. is the exclusive placement agent for the offerings, and legal counsel is provided by Stradling Yocca Carlson & Rauth LLP for Expion360 and Kaufman & Canoles, P.C. for Aegis Capital Corp.
The direct offering operates under an effective shelf registration statement previously filed and declared effective by the SEC on July 10, 2023. Details of the offering will be outlined in a final prospectus supplement and accompanying prospectus, accessible on the SEC’s website.
The private placement portion is not registered under the Securities Act of 1933 and is limited to accredited investors. In accordance with a registration rights agreement, Expion360 will file registration statements for the resale of shares issued upon warrant exercise.
This announcement follows Expion360’s entry into the home energy storage market on December 19, 2023, introducing two premium battery storage systems designed for residential and small business use. Expion360’s lithium-ion batteries are reputed for their lightweight, high power, and longevity, surpassing standard lead-acid batteries. InvestingPro’s Fair Value analysis suggests the stock is currently undervalued, despite facing significant operational challenges with 11 additional key insights available to subscribers.
The information in this article is based on a press release statement from Expion360 Inc.
In other recent news, Expion360 Inc. anticipates a significant revenue growth of approximately $5 million in 2025 due to new partnerships within its OEM and distribution network. These partnerships are also expected to contribute an estimated $1.4 million increase in gross profits for the same period. The company has also implemented a 1-for-100 reverse stock split, approved by the Board of Directors and stockholders, to comply with Nasdaq’s minimum bid price requirement.
In addition to these financial maneuvers, Expion360 terminated a major commercial lease agreement early, a move projected to save the company approximately $40,000 per month over the next 51 months. The company also priced its public offering with the aim of raising roughly $10 million, intended to repay outstanding debt and provide working capital for general corporate purposes.
On the product front, Expion360 has introduced its innovative Edge battery, featuring advanced internal heating technology known as Vertical Heat Conduction™, and real-time monitoring capabilities facilitated by Integrated SmartTalk™ Bluetooth and CAN Bus communication. Preorders for the Edge battery are now open, with shipping expected to start in the third quarter of 2024. These are recent developments from Expion360 Inc.
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