Netcapital Announces Exercise of Warrants for $2.2 Million Gross Proceeds

Netcapital Inc. (the “Company”) (NASDAQ: NCPL, NCPLW), a digital private capital markets ecosystem, today announced the entry into definitive agreements for the immediate exercise of certain outstanding Series A-2 warrants to purchase up to an aggregate of 14,320,000 shares of common stock of the Company originally issued in December 2023, having an exercise price of $0.25 per share, at a reduced exercise price of $0.155 per share. The shares of common stock issuable upon exercise of the warrants are registered pursuant to an effective registration statement on Form S-1 (No. 333-275210). The gross proceeds to the Company from the exercise of the warrants are expected to be approximately $2.2 million, prior to deducting placement agent fees and estimated offering expenses.

H.C. Wainwright & Co. is acting as the exclusive placement agent for the offering.

In consideration for the immediate exercise of the warrants for cash, the Company will issue new unregistered Series A-3 warrants to purchase up to 14,320,000 shares of common stock and new unregistered Series A-4 warrants to purchase up to 14,320,000 shares of common stock. The Series A-3 new warrants will have an exercise price of $0.155 per share, will be exercisable beginning on the effective date of stockholder approval of the issuance of the shares issuable upon exercise of the new warrants and will expire five years thereafter. The Series A-4 new warrants will have an exercise price of $0.155 per share, will be exercisable beginning on the effective date of stockholder approval of the issuance of the shares issuable upon exercise of the new warrants and will expire eighteen months thereafter.

The offering is expected to close on or about May 29, 2024, subject to satisfaction of customary closing conditions. The Company intends to use the net proceeds from the offering for general working capital purposes.

The new warrants described above were offered in a private placement pursuant to an applicable exemption from the registration requirements of the Securities Act of 1933, as amended (the “1933 Act”) and, along with the shares of common stock issuable upon their exercise, have not been registered under the 1933 Act, and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission (“SEC”) or an applicable exemption from such registration requirements. The Company has agreed to file a registration statement with the SEC covering the resale of the shares of common stock issuable upon exercise of the new warrants.