SINGAPORE - FingerMotion, Inc. (NASDAQ: FNGR), a mobile services and data company, has entered into a definitive securities purchase agreement with certain institutional investors. The agreement outlines the sale of 3,333,336 shares of the company's common stock and warrants to purchase up to 5,000,004 shares, at a combined price of $1.50 per share and associated warrant. The timing of this offering comes as the stock has experienced significant price volatility in recent trading sessions, according to InvestingPro data. This registered direct offering is expected to close around December 23, 2024, contingent upon standard closing conditions.
The warrants, exercisable immediately at $1.50 per share, have a five-year term from the initial exercise date. Roth Capital Partners (WA:CPAP) is serving as the exclusive placement agent for the transaction.
The gross proceeds from this offering are anticipated to be around $5.0 million before deducting fees for the placement agent and other related expenses. FingerMotion plans to allocate the net proceeds for general corporate purposes. While the company maintains liquid assets exceeding short-term obligations and operates with moderate debt levels, InvestingPro analysis indicates the company is not currently profitable over the last twelve months.
The offering is conducted through a shelf registration statement on Form S-3, previously filed and declared effective by the SEC on September 29, 2023. The offer is made solely by a prospectus, including a supplement, forming part of the effective registration statement.
FingerMotion is recognized for its proficiency in mobile payment and recharge platform solutions in China. The company is focused on user base expansion, aiming to create a highly engaged user ecosystem by developing and marketing value-added technologies. With a vision to serve over 1 billion users in China and potentially other regional markets, FingerMotion continues to advance its technological offerings. InvestingPro analysts project sales growth and a return to profitability this year, despite current challenges with gross profit margins. InvestingPro subscribers can access 7 additional key insights about FingerMotion's financial health and growth prospects.
This news is based on a press release statement and does not constitute an offer to sell or a solicitation to buy securities. The sale of these securities will not be lawful in any jurisdiction where such offer, solicitation, or sale would be unauthorized before registration or qualification under the securities laws of any such state or jurisdiction.
In other recent news, FingerMotion, Inc. has ended its At-the-Market Issuance Sales Agreement with Univest Securities, LLC. This termination was disclosed in a Form 8-K filed with the Securities and Exchange Commission, with no details or reasons for the dissolution provided. FingerMotion has also experienced a reshuffling in its board, with Michael Chan stepping down as a director and chair of the audit committee, and Hsien Loong Wong and Yew Poh Leong filling the vacancies.
In financial developments, FingerMotion secured two short-term loans for working capital, one for approximately USD $183,000 and another for SGD$250,000, both with a monthly interest rate of 1.67%. The loans were agreed with Rita Chou Phooi Har. The company also replaced its independent registered public accounting firm, Centurion ZD CPA & Co., with CT International LLP.
In terms of product development, FingerMotion launched the Advanced Mobile Integrated Command and Communication Platform (C2 Platform) in China, aimed at enhancing the coordination and communication of emergency response teams. These are recent developments, demonstrating FingerMotion's commitment to expanding its technology products and services.
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