A Penny Warrant is a warrant structured with a de minimis exercise price (often $0.01 per share or similarly nominal) so the holder can obtain the underlying shares with little additional cash payment once the warrant becomes exercisable. In venture debt, PIPEs, and structured equity financings, Penny Warrants are used to deliver equity upside while minimizing future exercise friction, and their economic impact is primarily dilution rather than cash proceeds to the issuer.
