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SAN DIEGO - Modular Medical, Inc. (NASDAQ:MODD), specializing in insulin delivery technology, has secured approximately $12 million in a private placement with institutional and accredited investors. The transaction involves selling units at $1.92 each, composed of two shares of common stock and a warrant to purchase an additional share. This fundraising effort is expected to close on March 25, 2025, given that standard closing conditions are met. The funding comes at a crucial time for the company, whose stock has declined nearly 59% over the past six months, according to InvestingPro data, which also indicates the company is currently trading below its Fair Value.
The proceeds from this private placement are earmarked for supply-chain enhancements and margin improvements for the company’s MODD1 product, which is gearing up for broad commercial release. Additionally, funds will support the development of a tubeless version of the MODD1 product, planned for submission to the FDA in the third quarter of 2025, and efforts to secure the CE mark for entry into overseas markets. InvestingPro analysis reveals the company has been rapidly burning through cash, with an EBITDA of -$17.51M in the last twelve months, though it maintains a strong current ratio of 5.3, indicating solid short-term liquidity.
In the private placement, Modular Medical will issue 12,495,312 shares of common stock and warrants to purchase 6,247,656 shares. These warrants, exercisable immediately at $1.12 per share, will remain valid for four years post-closing. Notably, company officers and directors have committed to purchasing 374,478 units under identical terms as other investors.
Newbridge Securities Corporation served as the sole placement agent, while Titan Partners Group provided financial advisory services to Modular Medical. The securities offered have not been registered under the Securities Act of 1933 and are subject to registration or exemption requirements for future sale in the U.S.
Concurrently, the company is also conducting a direct private placement to potentially raise an additional $500,000. This Concurrent Direct Placement mirrors the terms of the initial private placement and targets qualified institutional buyers under Regulation S of the Securities Act.
Modular Medical, founded by medical device professional Paul DiPerna, aims to simplify and reduce the cost of top-quality insulin delivery. The company’s mission is to extend advanced glycemic control beyond specialized users, making it accessible to a broader population. With a beta of -3.97, the stock typically moves contrary to market trends, making it an interesting consideration for portfolio diversification. InvestingPro subscribers can access 8 additional key insights about MODD’s financial health and market position, along with detailed valuation metrics and growth projections.
This article is based on a press release statement and contains forward-looking statements subject to various factors and uncertainties, as detailed in Modular Medical’s filings with the SEC.
In other recent news, Modular Medical, Inc. held its annual shareholder meeting where several key proposals were approved. Shareholders elected all seven director nominees, including Duane DeSisto, Paul DiPerna, and others, to serve until the next annual meeting. An important development was the approval of an amendment to the company’s 2017 Equity Incentive Plan, which increases the share reserve by 3,000,000 shares. This move is seen as a step to potentially attract and retain talent. Additionally, the ratification of Farber Hass Hurley LLP as the company’s independent registered public accounting firm for the fiscal year ending March 31, 2025, was confirmed with significant support. These decisions reflect the confidence of shareholders in the current leadership and strategic direction of Modular Medical. The company’s recent governance decisions are based on factual information from the shareholder meeting.
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