Pre-Funded Warrants: Separate Purchase and Exercise Cash

Is the financing cash paid at purchase or at exercise?

A pre-funded warrant can involve a substantial purchase payment and a small remaining exercise payment. Treating the whole common-share price as future exercise cash would put the same economic payment on the wrong date. The useful question is which amount belongs to the offering, which remains payable, and what transaction actually occurred?

Read the particular instrument rather than importing the exercise price of an ordinary warrant. Keep the issuer, security class, document date and payment stage attached to every amount.

A dated prospectus separates the two prices

Dianthus Therapeutics' September 9, 2025 prospectus supplement, accession 0001193125-25-200399, offers common stock at $33.00 per share and pre-funded warrants at $32.999, with $0.001 per underlying share payable on cash exercise. The cover describes 6,487,879 common shares and warrants covering 1,112,121 underlying shares.

These are historical offering terms, reviewed October 16, 2026. The cover expected delivery around September 11, 2025; that expectation is not independent proof of completed settlement, exercise or bank receipt. This article does not establish Dianthus' current capitalization or cash.

Create separate evidence rows:

Stage	Amount or count to preserve	Additional evidence needed
Offered instruments	Common shares versus pre-funded warrants and underlying shares	Actual issuance and settlement record
Purchase payment	Price paid for the security at purchase	Completed proceeds, fees and reporting period
Exercise	Residual price, exercised quantity and settlement method	Actual exercise notice and issuance disclosure
Later balance	Dated common shares and remaining rights	Reconciliation since the earlier reporting date

The price of a pre-funded warrant is not its residual exercise price. An underlying-share count also is not automatically an additional completed cash inflow.

Reconcile an illustrative cash exercise

Illustrative quantity, not an observed holder or transaction: assume 1,000 pre-funded warrants with those stated per-unit prices are purchased and later all exercised for cash, with no adjustment or fees.

Payment	Calculation	Illustrative amount
Purchase	1,000 × $32.999	$32,999
Residual exercise	1,000 × $0.001	$1
Combined payments	$32,999 + $1	$33,000

Adding another $33,000 at exercise would overstate the later payment by $32,999 in this assumed case. The prospectus also describes cashless exercise; the residual cash calculation above must not be applied to a cashless transaction. The actual settlement method and cash received remain UNKNOWN without the transaction evidence.

The example excludes commissions and expenses. It does not turn an offering price into net proceeds or explain how much the issuer retained. In a funding worksheet, reconcile a completed offering with the next reported cash balance before adding it again as a subsequent inflow.

Keep the share-count assumption visible

The prospectus' offering table shows 38,664,361 common shares after the offering assuming no exercise of the offered pre-funded warrants and no underwriter option exercise. Its stated starting base is 32,176,482 shares as of June 30, 2025. Adding the offered 6,487,879 common shares reproduces that displayed scenario.

This reconciliation does not prove a later outstanding-share count. Do not silently add the underlying warrants to a number that already assumes their exercise, or remove potential exposure because the remaining cash exercise price is small. Preserve the exact definition of the reported denominator and the separate inventory of rights.

The same document describes ownership limits on exercise and says holders generally do not have common-stockholder rights until exercise. Those instrument terms do not establish any particular holder's current position or tell us that exercise actually occurred. Tax, accounting and legal share-count treatments should not be collapsed into one label without their own definitions.

Make the next financing update answer a specific question

When a later filing reports an exercise or a changed share count, compare the security class, quantity, purchase cash already recognized, residual exercise cash, fees, settlement method and reporting dates. Leave unsupported adjustments UNKNOWN. This is a source-reconciliation task, not a prediction of share-price movement or future financing.

Use the ATM and dilution guide for the separate capacity-versus-sale question, the EPS denominator example for a period-based accounting measure, and the cash-runway worksheet for the dated funding bridge.

The existing entry prepares a general valuation-assumptions question for a company you choose. It does not automatically import this historical offering or the illustrative holder into that company's evidence. Review the company, question and required credits before a manual run; no complete financing assessment is certified here.