Company: IXHL
Filing Date: 2025-04-17
Form Type: PRER14A
Source: 0001213900-25-033013
Chunk: 31

Company: Incannex Healthcare Inc.
Filing Date: 2025-04-17
Form: PRER14A
Chunk 31
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 order to comply with Nasdaq Listing Rule 5635(d)
and permit the holders to exercise the Series A Warrants, our stockholders need to approve the issuance of the Series A Warrants and the
Series A Warrant Shares issuable upon exercise of the Series A Warrants together with the additional shares of our common stock that may
become issuable upon adjustments provided for under the Series A Warrants and the provisions of the Series A Warrants indicated above.
Until we obtain the Warrant Stockholder Approval in order to comply with Nasdaq Listing Rule 5635(d), the Series A Warrants are not exercisable.

Importantly and as noted above, if we fail to
obtain the full Warrant Stockholder Approval, we are required to seek stockholder approval every 60 days following such a failure (and
following any such future failure) until we obtain the full Warrant Stockholder Approval required for the full exercise of the Series
A Warrants pursuant to the terms of the Series A Warrants and failure to comply with this term could expose the Company to liability.
So, if we fail to obtain the Warrant Stockholder Approval at the Special Meeting and are forced to hold additional meetings of stockholders
to obtain the Warrant Stockholder Approval, the costs and expenses associated with again or repeatedly seeking the Warrant Stockholder
Approval could materially adversely impact our ability to fund or continue our operations, including the advancement of our clinical trials,
regulatory approvals for, and commercialization of our products and product candidates.

Potential Adverse Effects of the Approval of the Warrant Stockholder Approval Provisions

Following approval of the Issuance Proposal, existing
stockholders will likely suffer substantial dilution in their ownership interests as a result of the potential issuance of shares of common
stock upon exercise of the Series A Warrants. As of the closing on March 10, 2025, we issued Pre-Funded Warrants to purchase up to 1,887,045
shares of our common stock and Series A Warrants to purchase up to 11,574,090 shares of our common stock. Assuming full adjustment of
the exercise price equal to the Floor Price of $0.216 per share and exercise pursuant to the zero exercise price provisions in the Series
A Warrants, the exercise of the Series A Warrants would result in the issuance of up to 347,222,700 additional shares of our common stock.
In that case, the ownership interest of our existing stockholders would be correspondingly