Decoy Therapeutics Enters Warrant Inducement, Lowers Exercise Price and Raises $3.85M

What Happened

• Decoy Therapeutics Inc. announced on Sept. 22–23, 2026 that it entered a warrant inducement letter with a holder of its June 29, 2026 milestone warrants. The company reduced the exercise price of Series A, B and C milestone warrants from $5.91 to $3.25 per share. The holder exercised all Series B warrants on Sept. 22, 2026, covering 1,184,434 shares, and the exercise closed on Sept. 23, 2026, producing approximately $3.85 million in gross proceeds (before placement agent fees and expenses).
• As consideration for the immediate exercise, the company issued the holder new unregistered warrants to purchase up to 2,368,868 shares (200% of the exercised shares). The New Warrants are exercisable immediately, expire five years after issuance, have a $3.25 exercise price, include customary anti-dilution and cashless-exercise provisions and a 9.99% beneficial ownership cap. The issuance and exercise are not subject to stockholder approval.

Key Details

• Existing Series B exercised in full for 1,184,434 shares at a reduced $3.25 exercise price; gross proceeds ≈ $3.85M.
• New unregistered warrants issued for up to 2,368,868 shares (200% of exercised amount); 5‑year term, $3.25 strike, immediate exercisability, 9.99% ownership cap.
• Company will file a resale registration statement for the New Warrants’ underlying shares within 15 days of the Inducement Letter and will use commercially reasonable efforts to get it effective; resale of shares from the exercised warrants is already registered.
• Company agreed (subject to exceptions) to a 30‑day limited issuance restriction and to avoid variable rate transactions until 180 days after the resale registration becomes effective.

Why It Matters

• The transaction provides near‑term cash (~$3.85M gross) to Decoy for working capital and general corporate purposes, improving liquidity.
• Investors should note potential future dilution: the New Warrants could add up to 2,368,868 shares if exercised, though they include a 9.99% ownership limit and anti‑dilution features.
• The company’s commitment to register the resale of New Warrant shares affects the timing of secondary sales; the short lock-up and other issuance limits are meant to balance capital needs and shareholder protections.
• No management changes or earnings disclosures were included; this filing is focused on the financing and related warrant amendments.