13 June 2023
NUBURU private placement raises $7.925m from existing investors
NUBURU Inc of Centennial, CO, USA — which conducts research, development, design and manufacturing of high-power, high-brightness industrial blue lasers — has entered into definitive agreements primarily with certain existing investors to receive a cash infusion of $7.925m (prior to deducting transaction and issuance costs) through an offering of (i) convertible promissory notes and (ii) warrants to purchase shares of common stock. The shares underlying the convertible notes and warrants are subject to a one-year lock up and are expected to be registered for resale on a registration statement on Form S-3 after 6 February 2024.
“With this cash infusion the company will be in a better position to continue to execute its commercialization efforts with respect to its current products and its development efforts with respect to its product pipeline,” comments CEO & co-founder Dr Mark Zediker. “The transaction provides important growth capital and bolsters the company’s balance sheet,” notes chief financial officer Brian Knaley. “We intend to deploy this capital in a careful and efficient matter with the aim of accruing long-term benefits for our stockholders.”
NUBURU is issuing the convertible notes and warrants in an initial closing of $2m, and in a subsequent closing of $5.925m expected on 23 June. Upon conversion of the convertible notes, the firm would issue up to 11.5 million shares of common stock. Upon exercise of the warrants, which would generate additional proceeds of up to $11.9m, the firm would issue up to 11.5 million shares (subject to customary adjustments). NUBURU may issue additional shares if it elects to pay interest in kind on the convertible notes.
The convertible notes bear interest at the rate of 7% per year, mature on 23 June 2026 (unless redeemed, repurchased or converted prior to such date), have a conversion price equal to $0.688 (representing a premium of $0.01 over the closing price of the prior trading day) and are senior, unsecured obligations of the company. The warrants have an exercise price equal to $1.03 (representing a premium of 50% over the conversion price) and expire on 23 June 2028.
According to the NYSE American LLC Company Guide, consummating the transactions pursuant to the purchase agreement would ordinarily require the approval of the stockholders. However, NUBURU has sought and received from NYSE American an exception from obtaining such stockholder approval pursuant to Section 710(b) of the Company Guide. A special committee of NUBURU’s board of directors, consisting solely of independent, disinterested directors, has expressly approved the firm’s reliance on this exception, and the transaction was also unanimously approved by the board.