ROMEOVILLE, Ill. - Nanophase Technologies Corporation (OTCQB: NANX), a company engaged in minerals-based healthcare solutions, announced it has completed a $6 million equity financing arrangement with Strandler, LLC, an entity associated with its principal shareholder, Bradford T. Whitmore.
The investment, structured as convertible preferred stock, will potentially add 15 million shares to Nanophase's common stock at a conversion price of $0.40 per share, subject to shareholder approval and authorization of additional common shares.
The agreement stipulates that Strandler will hold the converted common shares for a minimum of one year from the conversion date. Additionally, as part of the deal, Strandler, LLC and Beachcorp, LLC, both affiliates of Whitmore, have consented to extend the maturity of the company's existing loans until October 1, 2025.
Nanophase's President and CEO, Jess Jankowski, acknowledged the company's Q4 2023 financial performance did not meet expectations, with a reported net loss of $2.1 million and annual revenue of $37.3 million for FY2023. Legal expenses related to a lawsuit with BASF accounted for 30% of the annual loss. The company experienced operational cash shortages due to the Q4 loss and increased working capital demands, further exacerbated by raw material shortages in early January.
Despite these challenges, Jankowski remains optimistic about the future, citing over $30 million in completed shipments and confirmed purchase orders, and anticipates a profitable second half for 2024. The funding is expected to bolster the company's operations and sustain its growth strategy.
Nanophase plans to release its full 2023 financial statements on March 20, 2024, followed by a conference call on March 21, 2024, to discuss the results and outlook for 2024 in detail.
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