Gaxos.ai Closes $3.6 Million Warrant Repricing, Issuing Two New Warrants for Every Share Exercised

by Adam Kowalczyk · August 18, 2026

Filings & Deals Reporter, The MicroCap Herald

Gaxos.ai Inc. (Nasdaq: GXAI) said on Monday, August 17, that it had closed a warrant exercise transaction generating approximately $3.6 million in gross proceeds, according to a company release distributed via GlobeNewswire that afternoon. The structure is a warrant inducement. The company reduced the exercise price on existing warrants covering 3,007,654 shares of common stock from a range of $2.33 to $3.32 per share down to $1.20 per share, and in exchange for those cash exercises issued the participating holders new unregistered warrants covering 6,015,308 shares at an exercise price of $0.95.

The warrants that were repriced were originally issued in September 2024 and December 2024, the company said. H.C. Wainwright & Co. acted as exclusive placement agent. Gaxos.ai said it intends to use net proceeds for working capital and general corporate purposes. The agreements were announced on Friday, August 14, with closing expected on or about August 17 subject to customary conditions; Monday's release confirmed that closing.

The share-count arithmetic is central to the transaction. The most recent share count Gaxos.ai has disclosed is 10,744,634 shares of common stock outstanding as of August 12, 2026, the figure given in its second-quarter results release; the same number appears in the company's definitive proxy statement as the count on the June 22, 2026 record date for its annual meeting. The Herald found no more recent count on file. Against that base, the 3,007,654 shares issued on exercise represent an increase of roughly 28 percent, which on closing would take shares outstanding to approximately 13.75 million. The 6,015,308 new warrants, if fully exercised, would add a further amount equal to about 56 percent of the 10,744,634 base, taking the fully diluted figure from this transaction alone to roughly 19.8 million shares, an increase of about 84 percent. Full exercise of the new warrants at $0.95 would deliver approximately $5.7 million more in gross proceeds, but only if holders choose to exercise.

Whether the new warrants are exercised depends on the share price. The new warrants carry a $0.95 strike. StockAnalysis.com showed GXAI trading at $0.8553 at 3:11 p.m. Eastern on Friday, August 14, down 32.12 percent on the session, with a market capitalisation of $8.74 million and a 52-week range of $0.7345 to $2.96; that quote is as of that time on that date and is not a current price. On that price, the new warrants were out of the money at issuance and the induced exercises at $1.20 were struck well above the prevailing market. The Herald could not verify Monday's closing price from a filed document and is not asserting one. At a market capitalisation of that order, GXAI is a nano-cap: the shares are thinly capitalised, and holders can face wide spreads and sharp price moves on comparatively small orders, as the August 14 session illustrates.

On the August 14 announcement, StockTitan recorded a 31.10 percent decline in the shares, with the stock at $0.87 on delayed data, on volume it calculated at 75.7 times the average, attributing the move to dilution from the new warrant issuance. That is a description of trading, not of the company's operations, and it is reported here as such.

This is not the first time Gaxos.ai has used this structure. In September 2024, the company announced a warrant exercise agreement covering 1,256,734 shares in which the exercise price was cut from $5.50 to $2.58, producing gross proceeds of roughly $3.24 million, with H.C. Wainwright again as placement agent. The consideration then was 2,513,468 new warrants at $2.33 — split into a 1,256,734-share tranche running 5.5 years and a 1,256,734-share tranche running 24 months. The $2.33 strike sits at the bottom of the range of warrants repriced this month, meaning the securities issued as an inducement in 2024 have themselves now been repriced downward as an inducement in 2026.

The company has also been selling stock into the market. An 8-K filed March 20, 2026 disclosed that Gaxos.ai increased the capacity of its at-the-market offering programme by $1,065,001, having already sold approximately $5,600,000 of common stock under a sales agreement with H.C. Wainwright dated January 23, 2026. The same bank is the sales agent for the ATM and the placement agent on the inducement.

On the balance sheet, the most recent quarterly report the Herald was able to read directly is the Form 10-Q for the period ended March 31, 2026, filed with the SEC. It shows 10,219,934 shares of common stock outstanding at March 31, 2026, up from 7,123,453 at December 31, 2025 after 3,096,481 shares were sold for cash under the H.C. Wainwright at-the-market agreement during the quarter; an amendment filed May 18, 2026 corrected the original cover page, which had carried the December figure, to 10,219,934 as of May 13, 2026. The filing shows cash of $1,513,550, working capital of $11,587,582 and an accumulated deficit of $14,872,829. The net loss for the three months ended March 31, 2026 was $2,474,246, widening from $1,232,062 in the comparable 2025 quarter. Management stated in that filing that it expected existing working capital and cash on hand to be sufficient to meet operating needs and debt requirements for the following twelve months — language that stops short of a going-concern qualification, and which predates this month's transaction.

Gaxos.ai reported second-quarter 2026 results on August 12. Revenue was approximately $2.46 million, up 35.8 percent from $1.81 million in the first quarter and 1,337 percent from roughly $0.17 million in the second quarter of 2025 — a percentage that is large because the year-earlier base was very small. The company reported GAAP net income of $241,056, or $0.02 per basic and diluted share, and said the figure primarily reflected a gain on the gaming asset sale. At the operating line the company was loss-making: third-party analysis of the release puts the quarterly operating loss at approximately $1.86 million. The gaming assets were sold to Game Foundry AI, per a July 28 company release, for 2.2 million shares of Game Foundry AI common stock valued at approximately $1.76 million — consideration in stock rather than cash. Gaxos.ai also said it would report developments at its 19.99 percent stake in America First Defense.AI LLC separately from its consolidated operating performance.

The release put cash and short-term investments at roughly $11.44 million as of June 30, 2026, a figure that sits beside a company raising $3.6 million gross through a dilutive repricing six weeks later. Two things about that figure are worth stating plainly. It is a combined cash-and-investments number, and the company did not break out how much of it is cash; the last separately disclosed cash balance the Herald could read in a filing was $1,513,550 at March 31, 2026, against working capital of $11,587,582 on the same date. And the consideration received for the gaming assets was Game Foundry AI stock, not cash. The Herald has not seen a filed balance sheet for the June 30 quarter and is not asserting a composition for the $11.44 million; the company has not explained the relationship between that figure and the August raise, and this article does not infer one.

The chronology of the past three weeks is a matter of record. On August 3, 2026, Gaxos.ai announced that its board had authorised a share repurchase programme of up to $1,000,000. Chief executive Vadim Mats said in that release that "the board's decision to authorize a share buyback program directly reflects its belief that the Company's current stock price does not indicate Gaxos' true value." The company said the programme does not obligate it to acquire any particular number of shares, and that timing, volume and price would depend on liquidity, market conditions and regulatory limits, with the programme subject to suspension or discontinuation at any time. On August 14 the company announced the warrant repricing described above, which expands the potential share count by up to roughly 84 percent. The Herald has not seen a filing disclosing whether any shares were repurchased under the August 3 authorisation, and draws no conclusion about the relationship between the two announcements.

Separately, Gaxos.ai's definitive proxy statement dated July 2, 2026 put a reverse stock split before shareholders at the August 11, 2026 annual meeting, at a ratio of not less than 1-for-2 and not greater than 1-for-50, exercisable by the board at any time before August 11, 2028. The same meeting considered raising the 2022 Equity Incentive Plan reserve to 1,000,000 shares from 803,637, which the proxy described as 9.78 percent of fully diluted shares. The Herald could not locate a filed report of the voting results and therefore is not stating whether the reverse-split authority was granted. If it was granted and the board later used it, a reverse split would reduce the share count and raise the quoted price proportionately without changing the economic value of a holding, and would apply to the shares underlying the warrants described here. Gaxos.ai has done this before: it completed a 1-for-12 reverse split effective for trading on March 8, 2024, which left it with roughly 981,523 shares outstanding at the time. All share counts and prices in this article are stated on the post-2024-split basis.

One point requires care. Nasdaq Listing Rule 5550(a)(2) requires a $1.00 minimum closing bid price, and a security that closes below $1.00 for 30 consecutive business days becomes subject to a deficiency notice and a 180-calendar-day cure period, during which the company must post ten consecutive business days at or above $1.00. Gaxos.ai has not disclosed receiving any such notice in connection with its recent trading below $1.00, and nothing in this article should be read as saying that it has or that its listing is in question. The company has been through the process once before, on facts that predate the current business: Nasdaq notified it on July 10, 2023 that it had failed to maintain the $1.00 minimum bid price, and Nasdaq confirmed on March 22, 2024 that compliance had been regained after the stock traded above $1.00 for ten consecutive sessions through March 21, 2024. That matter is closed. What is observable now is that the stock last traded below $1.00 on the reference data available, that its 52-week low is $0.7345, and that the board asked shareholders for reverse-split authority against that backdrop.

Two further caveats belong in the same breath as the $3.6 million figure. The new warrants covering 6,015,308 shares were issued privately, in reliance on an exemption from registration, and are not registered securities; the company agreed to file a resale registration statement, and the warrants expire three years after the date that statement is declared effective. The Herald has seen no filing showing that a resale registration statement has been filed or declared effective. Until it is, holders cannot freely resell the underlying shares and the length of the warrants' life is itself undetermined, and the market cannot know when that overhang of up to 6,015,308 shares becomes freely tradable. And $3.6 million in gross proceeds — before placement agent fees and expenses, which the company did not quantify in the release — is a modest sum against a company that lost $2.47 million in a single quarter earlier this year.

The documents that will settle the remaining questions are the Form 8-K and the inducement letter agreement filed as an exhibit, which should specify the placement agent's compensation, any lock-up or price-protection provisions, and the precise warrant terms; and the subsequent resale registration statement, which will identify the selling holders and the exact number of shares being registered. Nothing in Monday's release establishes a change in the company's operating trajectory, its listing status, or its cash runway beyond the proceeds received. This article is a report of a disclosed transaction and is not investment advice.