Market reaction and offering overview
Shares of Abits Group Inc (NASDAQ:ABTS) dropped 23.3% on Monday after the company disclosed a registered direct offering aimed at institutional investors that is expected to generate approximately $2.1 million in gross proceeds. The sales package includes Ordinary Shares and Pre-Funded Warrants that were agreed under definitive agreements.
Terms and mechanics of the placement
Under the agreement, Abits Group will sell a combined total of 792,452 Ordinary Shares or Pre-Funded Warrants at a public offering price of $2.65 per Ordinary Share. The Pre-Funded Warrants are being offered at $2.64999 apiece, a price equal to the public offering price less an exercise price of $0.00001 per warrant.
The Pre-Funded Warrants will be immediately exercisable and may be exercised at any time until they are fully exercised. For every Pre-Funded Warrant sold, the number of Ordinary Shares included in the offering will be reduced on a one-for-one basis.
Regulatory and closing details
The transaction has been priced at the market in accordance with Nasdaq rules, and the company expects the deal to close on or about February 24, 2026, subject to customary closing conditions. Abits Group anticipates aggregate gross proceeds of approximately $2.1 million from the offering.
Use of proceeds and corporate purpose
Abits Group said it intends to apply the net proceeds from the offering, together with its existing cash resources, for general corporate purposes and working capital. The company operates a digital center and bitcoin mining operations, and the stated use of funds is for broad corporate needs rather than any specifically identified capital expenditures.
Advisors and counsel
Aegis Capital Corp. is serving as exclusive placement agent for the offering. Kaufman & Canoles, P.C. is acting as U.S. counsel to Abits Group, while Lucosky Brookman LLP is serving as U.S. counsel to Aegis Capital Corp.
Context for stakeholders
The combination of a registered direct offering aimed at institutional investors and the immediate exercisability of the Pre-Funded Warrants defines the structure of this capital raise. Investors and counterparties will note the pricing mechanics - including the nominal $0.00001 exercise price on each warrant - and the expected timing of closing as key operational details.