Kairos Pharma, Ltd. (NYSE American: KAPA), a pharmaceutical company with a market capitalization of $22.74 million, has entered into a material definitive agreement and closed a private investment in public equity (PIPE) financing, raising $3.5 million through the sale of pre-funded and common warrants to an accredited investor.
The transaction was completed on Thursday, January 16, 2025. According to InvestingPro data, the company maintains a healthy liquidity position with a current ratio of 2.84.
The deal, initially announced on January 14, 2025, involved the issuance of 2,500,000 pre-funded units, each consisting of a pre-funded warrant to purchase one share of common stock for $0.001, and a common warrant to purchase one and one-half shares of common stock at $1.40 per share. The pre-funded units were sold at $1.399 each, with an additional $2,500 due upon full exercise of the pre-funded warrants.
In an amendment to the original securities purchase agreement, Kairos Pharma is now required to seek shareholder approval before issuing shares amounting to more than 19.99% of its common stock. Additionally, the terms of the common warrants were modified to become immediately exercisable and to reduce the exercise period from five and a half years to five years.
Boustead Securities, LLC and D. Boral (OTC:BOALY) Capital LLC served as co-placement agents for the offering. As part of the placement agent agreement, the company paid an 8% cash commission on the gross proceeds, including a 1% non-accountable expense fee, and issued warrants to purchase a total of 175,000 shares of common stock, exercisable at $1.40 per share.
Under the registration rights agreement, Kairos Pharma is obliged to file a resale registration statement with the SEC within 15 days of the closing and secure its effectiveness within 30 days thereafter, subject to SEC review. The stock has shown significant momentum, with InvestingPro reporting an impressive 82.47% return over the past week. Subscribers to InvestingPro can access 8 additional key insights about KAPA's financial health and market position.
The securities sold in the offering were not registered under the Securities Act of 1933, as amended, but were offered under an exemption as a transaction not involving a public offering. The company has agreed to file the necessary documents with the SEC to register the resale of these securities.
This report is based on a press release statement and provides a summary of the key events and agreements entered by Kairos Pharma, Ltd. as disclosed in their recent 8-K filing with the SEC. Based on InvestingPro's Fair Value analysis, the stock is currently trading near its Fair Value, suggesting the market has efficiently priced in this financing event.
In other recent news, Kairos Pharma has secured $3.5 million through a private investment in public equity (PIPE) transaction. The transaction involves issuing 2,500,000 common units at $1.40 each, with each unit consisting of one common share and one warrant to purchase additional common shares. The closing of the transaction is expected to occur with total gross proceeds anticipated to be $3.5 million, assuming no warrants are exercised.
In a recent shift in leadership, Kairos Pharma announced the resignation of Dr. Rosemary Mazanet and the appointment of Dr. Rahul Singhvi to its board of directors. Dr. Singhvi, with his significant experience in the life sciences industry, will serve on the audit committee and chair the compensation committee and the nominating and corporate governance committee.
Analysts have set an ambitious target price of $9 per share for Kairos Pharma, despite the company's EBITDA of -$1.83 million in the last twelve months. EF Hutton has initiated coverage on Kairos Pharma with a Buy rating and a price target set at $9.00, highlighting the company's innovative work on immune suppression and drug resistance in the field of cancer therapeutics.
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