CINCINNATI – Onconetix, Inc. (NASDAQ:ONCO), a biotechnology company, has announced the immediate exercise of certain outstanding warrants to purchase common stock at a reduced price. Originally issued in August of two years ago with prices between $1.09 and $2.546, these warrants can now be exercised at $0.15 per share.
The transaction is set to close tomorrow, subject to customary closing conditions, with HC Wainwright & Co. acting as exclusive placement agent. Onconetix expects to raise approximately $1.11 million in gross earnings before fees and expenses, which will be allocated for working capital and general corporate purposes.
Common shares issuable upon exercise of existing warrants registered pursuant to the Registration Statement on Form S-1, effective as of July 1, 2024. In addition, Onconetix plans to issue new unregistered warrants of up to 22,375,926 shares of common stock at an equal discount. price of $0.15 in private placement, subject to shareholder approval.
These new warrants will be exercised after shareholder approval, with one third valid for five years and two thirds for twenty four months from the date of approval.
The company has committed to hold a shareholder meeting within 90 days of closing to seek the necessary approvals. The new warrants and the convertible shares of common stock are not registered under the Securities Act of 1933 and, as such, may not be offered or sold in the U.S. without registration or an applicable exemption.
Onconetix, formerly known as Blue Water Biotech, Inc., focuses on men’s health and oncology solutions. They have Proclarix, a prostate cancer diagnostic test approved in the European Union, and ENTADFI, an FDA-approved treatment for benign prostatic hyperplasia. The company intends to file a registration statement with the SEC for the resale of shares that may be issued upon the new warrants.
In other recent news, Onconetix, a pharmaceutical company, has undergone significant executive changes, including the departure of CFO Bruce Harmon and the appointment of Karina M. Fedasz as interim CFO.
The company announced that Harmon’s departure was followed by a two-month severance package. Fedasz, with more than twenty years of experience in financial management and strategic planning, has played a role in business development and as CFO in various industries.
Prior to joining Onconetix, Fedasz offered his expertise to clients, including non-profit organizations and early-stage companies focused on artificial intelligence and health tracking. He also managed the initial public offering for IDW Media Holdings. In addition to Fedasz’s appointment, Onconetix has engaged CFO Squad LLC for certain accounting services.
The company has not announced compensation rules for Fedasz, stating that the Compensation Committee of the Board of Directors will determine this at a later date. Onconetix clarified that there is no family relationship between Fedasz and the company’s directors or executive officers, and that he has no material interest in transactions that require disclosure.
InvestingPro Insights
In the context of the recent announcement of Onconetix, Inc. (NASDAQ:ONCO) regarding the exercise of warrants, a closer look at the company’s financial health and stock performance may provide additional information for investors. According to InvestingPro data, Onconetix has a market capitalization of only $3.35 million, representing a small stock. The company’s price-to-earnings (P/E) ratio stands at -0.07, indicating that it is currently unprofitable. Furthermore, the gross profit margin for the last twelve months in Q1 2024 is very negative at -123.62%, which underlines the company’s challenge to maintain profitability.
InvestingPro Tips highlights several areas of concern for Onconetix, including its significant debt load and rapid cash burn rate. Analysts also expect a decline in sales this year, which could affect the company’s ability to generate profits. With stocks experiencing high price volatility, these factors should be carefully considered by potential investors. In addition, Onconetix does not pay a dividend, which could affect its appeal to income-seeking shareholders. Please note that there are 13 additional InvestingPro Tips available that can provide more context on the financial status and performance of a company’s stock.
For investors interested in a more in-depth analysis of Onconetix, Inc., using InvestingPro can provide valuable insights to inform investment decisions. Remember to use the coupon code NOTICE 24 to get up to 10% discount on annual Pro and annual or bi-annual Pro+ subscriptions, which include additional InvestingPro Tips and real-time metrics.
This article was created with the support of AI and was reviewed by the editor. For more information see our T&C.