Why Did XWELL Shares Surge 158% After Hours?
XWELL, Inc. (NASDAQ:XWEL) shares rose 158.10% in after-hours trading on Tuesday to $0.98, following the company's announcement of a private placement expected to generate gross proceeds of approximately $31.3 million, before deducting placement agent fees and offering expenses.
Inside the Deal
XWELL entered into a securities purchase agreement with a series of American Ventures, LLC, a Texas-based real estate investment firm, issuing approximately 31,333 shares of Series H Convertible Preferred Stock with a stated value of $1,000 per share, convertible into 66.66 million shares of common stock at an initial conversion price of $0.47 per share.
The placement also includes accompanying warrants to purchase up to 66.66 million shares, exercisable immediately at $0.345 per share, expiring three years from issuance.
Dominari Securities acted as exclusive placement agent.
Proceeds Earmarked for Debt Repurchase
XWELL said it intends to use the proceeds to repurchase $5.95 million of certain notes from institutional investors, redeem its Series G preferred stock and repurchase warrants to buy up to 8.8 million shares of common stock from institutional investors, for a total cash outlay of $9 million.
The remaining funds will be used for general corporate and working capital needs.
The placement is expected to close on or about Thursday.
Trading Metrics, Technical Analysis
XWELL has a Relative Strength Index (RSI) of 45.99.
The market capitalization of the New York-based health and wellness holding company stands at $2.19 million, with its shares reaching a 52-week high of $1.42 and a low of $0.26.
XWEL has fallen 66.55% over the past 12 months.
Price Action: According to Benzinga Pro data, XWEL closed on Tuesday at $0.38, up 9.63%.
The stock is currently positioned at approximately 10.3% above its 52-week low, indicating it is trading closer to the lower end of its annual range.
Benzinga's Edge Stock Rankings indicate that XWEL has a negative price trend across all time frames.
Photo Courtesy: m.mphoto on Shutterstock.com
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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