I have read that ImmunoCellular Therapeutics (
ImmunoCellular Therapeutics, Ltd. ("ImmunoCellular") (NYSE MKT: IMUC) today announced the pricing of an underwritten public offering of 5,000 shares of its Series B 8% Mandatorily Convertible Preferred Stock ("Preferred Stock") and related warrants ("Warrants") to purchase up to 9,000 shares of Preferred Stock, at a public offering price of $1,000 per share of Preferred Stock and related Warrants, for gross proceeds of approximately $5 million, excluding the proceeds, if any, from the exercise of the Warrants.
Each share of Preferred Stock is being sold together with (i) 0.6 of a Series 1 Warrant to purchase one share of Preferred Stock, (ii) 0.6 of a Series 2 Warrant to purchase one share of Preferred Stock, and (iii) 0.6 of a Series 3 Warrant to purchase one share of Preferred Stock. The Preferred Stock has an initial stated value of $1,080 and is convertible into shares of the Company's Common Stock at a conversion price equal to the lesser of (a) $1.22, subject to certain adjustments, and (b) 87.5% of the lowest volume weighted average price of the Company's Common Stock during the ten trading days ending on, and including, the date of the notice of conversion. The conversion price described in (b) is subject to a floor of?$0.35, except in the event of anti-dilution adjustments. Each Warrant will have an initial exercise price of $1,000 per share of Preferred Stock. The Series 1 Warrants, Series 2 Warrants, and Series 3 Warrants will be immediately exercisable and will expire on the three-month, six-month, and twelve-month anniversary of the original issuance date, respectively.
The Offering is expected to close on July 21, 2017, subject to the satisfaction of customary closing conditions.
Maxim Group LLC is acting as sole book-running manager for the offering. The shares are being offered pursuant to a written prospectus forming part of an effective registration statement on Form S-1 previously filed with the Securities and Exchange Commission (SEC). When available, copies of the final prospectus relating to this offering may also be obtained by contacting Maxim Group LLC, 405 Lexington Ave., New York, NY, 10174; Attn: Prospectus Department, or by Telephone: (800) 724-0761; or Email: firstname.lastname@example.org, or by accessing the SEC's website at www.sec.gov.
Why would this cause the stock to crush so hard? What does it mean to do a public offering of convertible preferred stock and warrants?