Business Context and Reporting Period
Company: Kairos Pharma, Ltd.
Filing Type: Form 8-K (Current Report)
Date of Report: January 14, 2025
Event: Entry into a Material Definitive Agreement for a private placement offering (PIPE) to raise capital.
Key Financial Metrics and Transaction Details
This filing details a capital raise rather than operational financial results. Key transaction metrics include:
- Aggregate Gross Proceeds: $3.5 million (before deducting placement agent fees and expenses).
- Securities Issued:
- 2,500,000 Common Units at $1.40 per unit.
- Pre-Funded Units at $1.399 per unit (quantity redacted in source text).
- Warrant Terms:
- Common Warrants: Exercise price of $1.40; exercisable after six months; expire in 5.5 years.
- Pre-Funded Warrants: Exercise price of $0.001; immediately exercisable.
- Placement Agents: D. Boral Capital LLC and Boustead Securities, LLC.
Note: The filing does not provide current revenue, profit, cash flow, or debt levels.
Material Changes and Agreements
The primary material change is the execution of a Securities Purchase Agreement with accredited investors. Additional agreements include:
- Registration Rights: The Company must file a registration statement within 15 days of closing and have it declared effective within 30 days (extendable by 30 days if reviewed by the SEC).
- Lock-Up Agreements: Executive officers, directors, and stockholders owning 10% or more are restricted from selling securities for 90 days post-closing.
- Beneficial Ownership Limits: Investors are restricted from exercising warrants if it results in ownership exceeding 4.99% (or 9.99% with 61 days' notice).
Guidance, Outlook, and Risks
Outlook: The final closing of the offering is expected on or about January 15, 2025. The proceeds are intended to support the Company's operations, though specific allocation is not detailed in this text.
Risks and Contingencies:
- Regulatory Risk: The offering relies on exemptions under Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D.
- Dilution Risk: The issuance of Common Units and Warrants will increase the number of outstanding shares, potentially diluting existing shareholders.
- Market Risk: The ability to resell shares depends on the effectiveness of the registration statement.
Investor Verification Checklist
- Verify the exact number of Pre-Funded Units sold, as the quantity is redacted in the source text.
- Confirm the final closing date and actual gross proceeds received after fees.
- Review the full text of the Securities Purchase Agreement (Exhibit 10.1) for covenants and redemption rights.
- Monitor the filing and effectiveness of the Registration Statement for resale of shares.
- Assess the impact of the 90-day lock-up on market liquidity for major shareholders.