MGRX.NASDAQMangoceuticals, INC
S-1: Mangoceuticals Files for Resale of 30 Million Shares Amidst Financial Restructuring
Sentiment:
Registration Statement
Mangoceuticals is registering for the resale of over 30 million shares of common stock by selling stockholders, involving commitment shares, ELOC shares, warrant shares, and preferred conversion shares.
Capital raiseThe company agreed to sell to the Purchaser, and the Purchaser agreed to purchase from the Company, 1,500 shares of Series B Preferred Stock of the Company for $1,650,000, and warrants to purchase up to 3,300,000 shares of common stock for an aggregate purchase price of $1,500,000.The SPA also provides the Purchaser the option to purchase an additional $1,100,000 (based on the stated value of the Series B Preferred Stock) of Series B Preferred Stock.The Company entered into an Equity Purchase Agreement (the ELOC ) with the Purchaser pursuant to which the Purchaser committed to purchase up to $25,000,000 of the Companys Common Stock.
Worse than expectedThe company's net loss increased significantly from $1,998,055 in 2022 to $9,212,417 in 2023.The company's basic and diluted loss per share increased from $(0.19) in 2022 to $(0.57) in 2023.
Summary
- Mangoceuticals has filed a registration statement for the resale of 30,014,286 shares of common stock by selling stockholders.
- The shares include 1,000,000 commitment shares, 10,000,000 ELOC shares, 3,300,000 warrant shares, and 15,714,286 preferred conversion shares.
- The ELOC shares are priced at an adjusted price of $0.26 per share.
- Warrant shares are issuable upon exercise of warrants with an exercise price of $0.26 per share.
- Preferred conversion shares are issuable upon conversion of Series B Preferred Stock, assuming a conversion price of $0.035 per share.
- The company will not receive any proceeds from the sale of shares by the selling stockholders.
- The company may receive proceeds from the sale of shares of common stock pursuant to the ELOC and from the exercise of the Warrants.
- The company's common stock is listed on the Nasdaq Capital Market under the symbol MGRX, with a last sale price of $0.2775 on April 22, 2024.
- The company is an emerging growth company and has elected to comply with certain reduced public company disclosure and reporting requirements.
Sentiment
Score: 3
Explanation: The document is largely negative due to the company's significant net losses, reliance on related party transactions, and need for additional funding. While there are some positives, such as the potential for future revenue growth, the overall outlook is uncertain.
Positives
- The registration statement allows selling stockholders to offer and sell their shares.
- The company may receive proceeds from the sale of shares of common stock pursuant to the ELOC and from the exercise of the Warrants.
Negatives
- The company will not receive any proceeds from the sale of shares by the selling stockholders.
- The company's common stock is trading at a low price of $0.2775 as of April 22, 2024.
- The company is an emerging growth company and has elected to comply with certain reduced public company disclosure and reporting requirements.
Risks
- Investing in the company's common stock involves risks described in the Risk Factors section.
- The company's ability to obtain additional funding, the terms of such funding, and dilution caused thereby are risks.
- The company has a limited operating history and has generated only limited revenues to date.
- The company's ability to execute its growth strategy and scale its operations is a risk.
- The company faces competition and its ability to create a well-known brand name is a risk.
- The company's reliance on related party transactions is a risk.
- The company's ability to protect its intellectual property is a risk.
- The company's ability to comply with government regulations is a risk.
- The company's reliance on its current management is a risk.
- The outcome of future lawsuits, litigation, regulatory matters or claims is a risk.
- The volatile nature of the trading price of the company's common stock is a risk.
- The company is currently not in compliance with Nasdaq's continued listing requirements and there is no guarantee that its common stock will continue to trade on Nasdaq.
Future Outlook
The company expects to incur substantial operating expenses in the foreseeable future as it continues to invest to bring its Mango ED and Mango GROW products to market and to attract customers, expand the product offerings and enhance technology and infrastructure.
Industry Context
The company operates in the mens wellness telemedicine services and products sector, which is a growing sector in recent years, especially related to the areas of erectile dysfunction (ED) and hair growth products.
Comparison to Industry Standards
- The company mainly competes with other companies offering mens wellness products, including Hims & Hers Health, Inc. and Roman.
- With its Mango ED products, the company competes against much larger pharmaceutical companies which offer ED branded drugs like Viagra (Pfizer) and Cialis (marketed by Lilly ICOS LLC, a joint venture between Eli Lilly and Company and ICOS Corporation) and their generic forms.
- With its Mango GROW product, the company competes against the much larger pharmaceutical company Merck & Co., which offers the branded hair loss product Propecia and Johnson & Johnson, the owner of Rogaine a branded form of Minoxidil.
Related Party Transactions
- The company has entered into a Master Services Agreement and Statement of Work with Epiq Scripts, LLC, a related party, 51% owned and controlled by Jacob D. Cohen, its Chairman and Chief Executive Officer.
- The company has entered into a Consulting Agreement with Epiq Scripts, LLC, a related party, 51% owned and controlled by Jacob D. Cohen, its Chairman and Chief Executive Officer.
- The company has entered into a First Addendum to Master Services Agreement with Epiq Scripts, LLC, a related party, 51% owned and controlled by Jacob D. Cohen, its Chairman and Chief Executive Officer.
- The company has entered into a Consulting Agreement with PHX Global, LLC, which is owned by Peter Casey Jensen, who was a member of the Board of Directors of American International.
- The company has entered into a Consulting Agreement with Ezekiel Elliott, a professional football player in the National Football League (NFL).
- The company has entered into a Consulting Agreement with David Sandler, an individual.
- The company has entered into a Consulting Agreement with Hsiaoching Chou, an individual.
- The company has entered into a service agreement with Greentree Financial Group, Inc.
- The company has entered into a Consulting Agreement with White Unicorn, LLC.
- The company has entered into a Consulting Agreement with Chartered Services, LLC.
- The company has entered into a Consulting Agreement with DojoLabs Group, Inc.
- The company has entered into a Consulting Agreement with Bethor, Ltd.
- The company has entered into an Advisor Agreement with Dr. Brian Rudman.
- The company has entered into an Advisor Agreement with Mr. Jarrett Boon.
- The company has entered into Consulting Agreements with four consultants to the Company: (1) Sultan Haroon; (2) John Helfrich; (3) Justin Baker; and (4) Maja Matthews, each of whom is also an employee of Epiq Scripts.
- The company has entered into a Software Development Agreement with Redlime Solutions, Inc.
- The company has entered into an Advisor Agreement with Mr. Aaron Andrew.
- The company has entered into a Production and Broadcasting Agreement with New To The Street Group, LLC.
- The company has entered into a service agreement with Greentree.
- The company has entered into an Influencer Contract with Jason Szkup.
- The company has entered into a Consulting Agreement with PHX Global, LLC.
- The company has entered into a Marketing Agreement with Marius Pharmaceuticals.
- The company has borrowed $37,500 from Ronin Equity Partners, which is owned and controlled by Jacob D. Cohen, the Companys Chief Executive Officer and Chairman.
- The company has borrowed $50,000 from Cohen Enterprises, Inc., which is owned and controlled by Jacob D. Cohen, the Companys Chief Executive Officer and Chairman.
- The company has borrowed $100,000 from Cohen Enterprises, Inc., which is owned and controlled by Jacob D. Cohen, the Companys Chief Executive Officer and Chairman.
Stakeholder Impact
- Shareholders may experience dilution due to the issuance of additional shares of common stock.
- The company's ability to attract new investors may be affected by its non-compliance with Nasdaq listing requirements.
- The company's ability to raise additional capital may be affected by its financial condition and operating results.
- The company's ability to provide products and services to customers may be affected by its reliance on related party transactions and its ability to comply with government regulations.
Next Steps
- The company is required to hold a meeting of stockholders to seek approval of a waiver of the Exchange Cap and, if needed, an increase in the authorized number of shares of Common Stock.
- The company is required to file a resale registration statement with the SEC to register for resale of the shares of the Companys Common Stock issuable upon conversion of all shares of Series B Preferred Stock which may be sold at the Initial Closing, Second Closing and Third Closing (and if such Option Closing has occurred as of such date, the Option Conversion Shares), shares of Common Stock issuable in lieu of cash dividends which could accrue on the Series B preferred Stock for a period of two years, and the Warrant Shares, within 30 days of the Closing Date, and to have such Registration Statement declared effective within 5 trading days after the date notified by the SEC that the SEC is not reviewing the Registration Statement, in the event the Registration Statement is not reviewed by the SEC, or 60 days of the Closing Date in the event the Registration Statement is reviewed by the SEC.
- The company is required to file a resale registration statement with the SEC to register all Common Stock underlying the Advance Shares, and the Commitment Shares, within 30 days of the Closing Date, and to have such ELOC Registration Statement declared effective within 5 trading days after the date notified by the SEC that the SEC is not reviewing the ELOC Registration Statement, in the event the Registration Statement is not reviewed by the SEC, or 60 days of the Closing Date in the event the ELOC Registration Statement is reviewed by the SEC.
Key Dates
| Date | Description |
|---|---|
| 2017-12-22 | Date listed in document. |
| 2021-12-09 | Date listed in document. |
| 2021-12-10 | Date listed in document. |
| 2021-12-31 | End of financial year. |
| 2022-01-01 | Start of financial year. |
| 2022-03-17 | Date listed in document. |
| 2022-03-18 | Date listed in document. |
| 2022-06-15 | Date listed in document. |
| 2022-06-16 | Date listed in document. |
| 2022-06-28 | Date listed in document. |
| 2022-06-29 | Date listed in document. |
| 2022-08-01 | Date of Physician Services Agreement with Doctegrity. |
| 2022-08-17 | Date listed in document. |
| 2022-08-18 | Date listed in document. |
| 2022-09-01 | Date of Master Services Agreement with Epiq Scripts. |
| 2022-09-15 | Date of Consulting Agreement With Epiq Scripts. |
| 2022-09-28 | Date listed in document. |
| 2022-10-01 | Date listed in document. |
| 2022-10-30 | Date of Nasdaq non-compliance notice. |
| 2022-11-18 | Date listed in document. |
| 2022-12-31 | End of financial year. |
| 2023-01-01 | Start of financial year. |
| 2023-01-03 | Date listed in document. |
| 2023-01-06 | Date listed in document. |
| 2023-01-24 | Date listed in document. |
| 2023-02-15 | Date listed in document. |
| 2023-02-28 | Date listed in document. |
| 2023-03-01 | Date listed in document. |
| 2023-03-20 | Date listed in document. |
| 2023-03-22 | Date listed in document. |
| 2023-03-23 | Date of IPO consummation. |
| 2023-03-31 | Date listed in document. |
| 2023-04-01 | Date listed in document. |
| 2023-04-04 | Date of Securities Purchase Agreement. |
| 2023-04-05 | Initial Closing Date of Securities Purchase Agreement. |
| 2023-04-24 | Date listed in document. |
| 2023-04-25 | Date listed in document. |
| 2023-04-26 | Date listed in document. |
| 2023-04-29 | Date to regain compliance with Nasdaq Listing Rule 5550(a)(2). |
| 2023-05-01 | Date listed in document. |
| 2023-05-25 | Date listed in document. |
| 2023-06-01 | Date listed in document. |
| 2023-06-05 | Date listed in document. |
| 2023-06-06 | Date listed in document. |
| 2023-06-07 | Date listed in document. |
| 2023-06-08 | Date listed in document. |
| 2023-06-21 | Date listed in document. |
| 2023-06-22 | Date listed in document. |
| 2023-06-27 | Date listed in document. |
| 2023-09-15 | Date of Consulting Agreement With Epiq Scripts. |
| 2023-10-01 | Date listed in document. |
| 2023-10-10 | Date listed in document. |
| 2023-10-30 | Date of Nasdaq non-compliance notice. |
| 2023-11-01 | Date listed in document. |
| 2023-11-03 | Date of Nasdaq non-compliance notice. |
| 2023-11-15 | Date listed in document. |
| 2023-12-11 | Date listed in document. |
| 2023-12-19 | Date listed in document. |
| 2023-12-28 | Date listed in document. |
| 2023-12-31 | End of financial year. |
| 2024-01-02 | Date listed in document. |
| 2024-01-10 | Date listed in document. |
| 2024-01-11 | Date listed in document. |
| 2024-01-18 | Date listed in document. |
| 2024-01-22 | Date listed in document. |
| 2024-03-18 | Date listed in document. |
| 2024-03-21 | Date listed in document. |
| 2024-03-25 | Date listed in document. |
| 2024-03-28 | Date listed in document. |
| 2024-04-01 | Date listed in document. |
| 2024-04-04 | Date of Series B Designation filing. |
| 2024-04-05 | Effective date of Securities Purchase Agreement. |
| 2024-04-22 | Date listed in document. |
| 2024-04-23 | Date of prospectus. |
| 2026-04-04 | ELOC termination date. |
Keywords
common stock, resale, ELOC, warrants, Series B Preferred Stock, selling stockholders, Mangoceuticals, registration statement, shares
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