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Akari Therapeutics Plc (NASDAQ:AKTX), a micro-cap biotech company with a market capitalization of approximately $33 million, reported Thursday that it has completed a private placement of unsecured promissory notes with an aggregate principal amount of $2,826,250 and a purchase price of $2,261,000. According to InvestingPro data, the company’s shares have declined over 73% in the past year, reflecting ongoing financial challenges. The notes were issued to certain investors, including company directors, in closings that took place on August 15 and August 18.
The notes carry a 20% original issuance discount and mature 12 months from their respective closing dates, when the principal is due. As part of the transaction, Akari Therapeutics agreed to extend by 48 months the expiration date of certain Series A Warrants held by the note investors. InvestingPro analysis reveals that the company’s current ratio stands at 0.19, indicating that short-term obligations exceed liquid assets, which helps explain the need for this financing. These warrants allow the purchase of a total of 1,973,211 American Depositary Shares, each representing 2,000 ordinary shares of the company.
Included in the transaction, Dr. Hoyoung Huh, Akari’s chairman, purchased a note with a principal amount of $1,250,000 for a purchase price of $1,000,000. The purchase price was satisfied through $162,567 in cash and the cancellation of $837,433 in outstanding principal and accrued interest under a prior promissory note issued to Dr. Huh by the company’s subsidiary, Peak Bio Inc., in January 2024. The company and Dr. Huh entered into a loan cancellation and exchange agreement on August 7 to extinguish the previous note as part of this transaction.
Akari Therapeutics also agreed to pay a 5% advisory fee in cash on gross cash proceeds of approximately $1.4 million to Paulson Investment Company in connection with the notes issued and sold on the closing dates.
This information is based on a press release statement and the company’s filing with the Securities and Exchange Commission.
In other recent news, Akari Therapeutics has made significant advancements in its cancer-fighting technology. The company continues to research its novel PH1 payload, which has shown potential in preclinical studies to inhibit key cancer tumor drivers and activate the immune system against tumors. Additionally, Akari Therapeutics has secured a patent in India for its PH1 payload technology, which includes spliceosome inhibitor payloads and proprietary linkers for cancer treatment applications.
Shareholders of Akari Therapeutics recently approved an increase in the number of shares available under the company’s 2023 Equity Incentive Plan, expanding it to 19,806,000,000 ordinary shares. This approval also allows for additional shares to be added if previously granted awards are forfeited or expire unexercised. On the analyst front, Maxim Group has initiated coverage on Akari Therapeutics with a Buy rating and a $5.00 price target, citing the potential benefits of Akari’s ADCs that utilize the PH1 payload. These developments reflect the company’s ongoing efforts to enhance its cancer treatment technologies and strategic growth plans.
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