BrainStorm Announces Warrant Exercise Inducement

BrainStorm Cell Therapeutics Inc. (NASDAQ:BCLI), a biotechnology company specializing in biological products with a current market capitalization of $6.79 million, announced today the entry into an inducement agreement with an institutional holder to exercise existing warrants for purchasing company stock. The agreement, dated March 31, 2025, will lead to the issuance of new warrants to the holder, contingent upon the exercise of the existing warrants. According to InvestingPro data, the company faces significant financial challenges, with a concerning current ratio of 0.05 indicating potential liquidity issues.

The company’s existing warrants, which include warrants issued on July 19, 2023, and June 28, 2024, allow for the purchase of up to 1,381,383 shares of common stock. Under the new inducement agreement, the holder will receive a new warrant to purchase up to 200% of the number of shares issued upon the exercise of the existing warrants.

The new warrants are set to have an exercise price of $1.19 per share and will become exercisable following the approval from BrainStorm’s stockholders, which is required by the rules of The Nasdaq Stock Market LLC. These warrants will expire five years from the date of stockholder approval.

The company expects the closing of this agreement to take place around April 1, 2025, with anticipated gross proceeds of approximately $1.64 million before deductions for closing costs and placement agent fees. BrainStorm intends to use the net proceeds for working capital and general corporate purposes. This funding comes at a crucial time, as InvestingPro analysis shows the company reported an EBITDA of -$13.05 million in the last twelve months, highlighting the urgent need for additional capital. Investors seeking deeper insights into BrainStorm’s financial health can access comprehensive analysis through InvestingPro’s detailed research reports, available for over 1,400 US-listed companies.

The shares underlying the 2023 warrants have been registered, while those associated with the 2024 warrants are expected to be issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act. BrainStorm has committed to file a registration statement for the resale of the new warrant shares and to maintain its effectiveness until all new warrants and shares have been sold or are no longer outstanding.

Additionally, BrainStorm will pay Maxim Group LLC, the inducement agent, a cash fee of 6.0% of the gross proceeds and cover legal fees and expenses amounting to $12,500, as per the financial advisory agreement.

The issuance of the new warrants and the subsequent sale of shares will not be registered under the Securities Act, and will be conducted in compliance with the exemption from the registration requirements.

This report serves as an informative piece based on a press release statement and does not constitute an offer to sell or a solicitation of an offer to buy any securities. With the company’s next earnings report due on April 2, 2025, investors can access additional financial metrics and expert analysis through InvestingPro, which offers 13 additional key insights about BrainStorm’s current financial position and market performance.

In other recent news, Brainstorm Cell Therapeutics Inc. has been granted an extension by the Nasdaq Hearings Panel to meet the exchange’s listing requirements by June 30, 2025. This extension follows Brainstorm’s appeal against a prior delisting decision due to non-compliance with the Minimum Value of Listed Securities (MVLS) requirement. The company presented a compliance plan during a hearing on February 25, 2025, which includes achieving a minimum stockholders’ equity of $2.5 million and executing capital-raising initiatives. Brainstorm is actively pursuing these strategies to maintain its Nasdaq listing, although there are no guarantees of success. The company is also initiating a Phase 3b study of its NurOwn® therapy for ALS and exploring strategic partnerships to enhance shareholder value. Additionally, Brainstorm is investigating exosome technology for potential applications in neurodegenerative and respiratory diseases. The Nasdaq extension is contingent upon Brainstorm’s progress in its capital-raising plan and public disclosure of specific information by the deadline. The company remains committed to transparency with stakeholders and will keep the market informed of its progress.

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