CINGW - Werth Family Investment Associates Converts $5.8 Million of Debt into Cingulate Equity at a Premium | Benzinga
KANSAS CITY, Kan., Sept. 08, 2023 (GLOBE NEWSWIRE) -- Cingulate Inc. (NASDAQ:CING) (Cingulate), a biopharmaceutical company utilizing its proprietary Precision Timed Release™ (PTR™) drug delivery platform technology to build and advance a pipeline of next-generation pharmaceutical products, announced today that Werth Family Investment Associates, LLC ("WFIA"), the manager of which is Peter J. Werth, a member of the Cingulate board of directors, has converted $5.8 million of debt and accrued interest into Cingulate equity, at a conversion price of $0.85 per share. The closing price of Cingulate's common stock on Nasdaq on September 8, 2023 was $0.5776 per share. The debt conversion follows WFIA's purchase of $1.0 million of Cingulate common stock in a private placement transaction in August 2023.
Cingulate, Cingulate Therapeutics LLC (CTx) and WFIA entered into a Note Conversion Agreement on September 8, 2023, pursuant to which WFIA agreed to convert $5.0 million of principal under its outstanding notes, plus all accrued interest thereon, or $5.8 million total, into pre-funded warrants ("Pre-Funded Warrants") to purchase 6,838,235 shares of Cingulate's common stock. The Pre-Funded Warrants have no expiration date and are exercisable immediately at an exercise price of $0.0001 per share, subject to a beneficial ownership blocker of 19.99%. Following the conversion, $3.0 million in principal plus $0.1 million in accrued interest remained outstanding under the WFIA note which matures in August 2025.
The offer and sale of the securities described above are being offered in a private placement under Section 4(a)(2) of the Securities Act of 1933, as amended (the "Act"), and Regulation D promulgated thereunder and, along with the shares of common stock underlying the warrants, have not been registered under the Act, or applicable state securities laws. Accordingly, the securities issued in the private placement and the shares of common stock underlying the warrants may not be offered or sold in the United States except pursuant to an effective registration statement or an applicable exemption from the registration requirements of the Act and such applicable state securities laws.
This press release does not constitute an offer to sell or the solicitation of an offer to buy any of the securities described herein, nor shall there be any sale of these securities in any state or other jurisdiction in which such an offer, solicitation or sale would be ...