Company: IXHL
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001213900-25-043682
Chunk: 12

Company: Incannex Healthcare Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 1
Chunk 12
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 divided into three separate tranches, each subject to closing conditions.
Under the September 2024 Purchase Agreement, the conversion price of each secured convertible debenture will equal 115% of the closing
price of the Common Stock on the trading day preceding the date of the issuance of the respective secured convertible debenture, subject
to subsequent adjustments and alternative conversion prices based on the then-current trading price of the Common Stock on Nasdaq, as
further detailed in the September 2024 Purchase Agreement. For each secured convertible debenture purchased under the September 2024 Purchase
Agreement, the Company will also issue a warrant to the purchaser, exercisable to purchase up to the number of shares of Common Stock
equal to 25% of the total principal amount of the related secured convertible debenture, divided by 115% of the closing price of the Company’s
Common Stock on the trading day immediately preceding the applicable closing date. The Company is not obligated to issue warrants for
any tranche that does not close. The exercise price of each warrant will be 115% of the closing price of the Common Stock on the issuance
date, and the warrants will have a five-year term. Additionally, the Company has agreed to pay a financial advisor up to 7% of the gross
proceeds raised under the September 2024 Purchase Agreement.

The Company completed the closing of the first
tranche under the September 2024 Purchase Agreement for the issuance of a 10% original issue discount secured convertible debenture (the
“First Tranche Debenture”) in the principal amount of $3,333,333 at an aggregate purchase price of $3 million (a 10% original
issue discount) to Arena Special Opportunities (Offshore) Master II LP (“Arena Opportunities”). The First Tranche Debenture
provides for a payment-in-kind interest rate at 5% and matures on April 14, 2026. In addition, the Company issued a warrant to Arena Investors
exercisable for up to 453,749 shares of Common Stock (the “First Tranche Warrant”), at an exercise price of $1.89 per share.

8

Note 2 – Basis of Presentation and Summary of Significant
Accounting Policies (continued)

The net proceeds received from the issuance of
the First Tranche Debenture, after deduction of expenses reimbursable to the Arena Investors, was $2,877,588.

The Company did not meet the