SAINT PAUL, Minn., Jan. 23, 2017 /PRNewswire/ -- EnteroMedics
Inc. (NASDAQ: ETRM), the developer of medical devices using
neuroblocking technology to treat obesity, metabolic diseases and
other gastrointestinal disorders, announced the closing of an
underwritten public offering of units for gross proceeds of
$19.0 million, which includes the
full exercise of the underwriters' over-allotment option to
purchase additional shares and warrants, prior to deducting
underwriting discounts and commissions and offering expenses
payable by EnteroMedics.
The offering comprised of Class A Units, priced at a public
offering price of $5.31 per unit,
with each unit consisting of one share of common stock and one
five-year warrant (each, a "warrant") to purchase one share of
common stock with an exercise price of $5.84 per share, and Class B Units, priced at a
public offering price of $1,000 per
unit, with each unit comprised of one share of preferred stock,
which is convertible into 188 shares of common stock, and warrants
to purchase 188 shares of common stock. The conversion price of the
preferred stock issued in the transaction as well as the exercise
price of the warrants are fixed priced and do not contain any
variable pricing features nor any price based anti-dilutive
features. The preferred stock issued in this transaction
includes a beneficial ownership blocker but has no dividend rights
(except to extent dividends are also paid on the common stock),
liquidation preference or other preferences over common stock. The
securities comprising the units are immediately separable and will
be issued separately.
Ladenburg Thalmann & Co. Inc., a subsidiary of Ladenburg
Thalmann Financial Services Inc. (NYSE MKT: LTS), acted as sole
book-running manager in connection with the offering.
A total of 751,412 shares of common stock, 12,531 shares of
preferred stock convertible into 2,359,887 shares of common stock,
and warrants to purchase 3,111,299 shares of common stock were
issued in the offering. Additionally, the underwriters have
exercised their over-allotment option to purchase 466,695
additional shares of common stock and warrants to purchase up to an
additional 466,695 shares of common stock at the public offering
price per share and warrant less the underwriting discounts and
commissions.
The securities were offered pursuant to a registration statement
on Form S-1 (File No. 333-213704), which was declared effective by
the United States Securities and Exchange Commission ("SEC") on
January 17, 2017.
This press release does not constitute an offer to sell or the
solicitation of an offer to buy, nor will there be any sales of
these securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of such jurisdiction. A
final prospectus relating to this offering will be filed by
EnteroMedics with the SEC. When available, copies of the
final prospectus can be obtained at the SEC's website at
www.sec.gov or from Ladenburg Thalmann & Co. Inc., Prospectus
Department, 570 Lexington Avenue, 11th Floor, New York, New York 10022, by calling (212)
409-2000.
About EnteroMedics Inc.
EnteroMedics is a medical device company focused on the
development and commercialization of its neuroscience based
technology to treat obesity and metabolic diseases.
vBloc® Neurometabolic Therapy, delivered by a pacemaker-like
device called the vBloc®System, is designed to intermittently block
the vagus nerves using high-frequency, low-energy, electrical
impulses. EnteroMedics' vBloc® System has received U.S. Food
and Drug Administration approval and CE Mark.
Forward-Looking Statements
This press release contains forward-looking statements about
EnteroMedics Inc. Our actual results could differ materially from
those discussed due to known and unknown risks, uncertainties and
other factors including our limited history of operations; our
losses since inception and for the foreseeable future; our limited
commercial sales experience with our vBloc® System for the
treatment of obesity in the United States or in any
foreign market other than Australia and the European
Community; our ability to regain and then maintain compliance with
the Nasdaq continued listing requirements; our ability to
commercialize our vBloc® System; our dependence on third
parties to initiate and perform our clinical trials; the need to
obtain regulatory approval for any modifications to our
vBloc® System; physician adoption of our vBloc® System
and vBloc® Neurometabolic Therapy; our ability to obtain third
party coding, coverage or payment levels; ongoing regulatory
compliance; our dependence on third party manufacturers and
suppliers; the successful development of our sales and marketing
capabilities; our ability to raise additional capital when needed;
international commercialization and operation; our ability to
attract and retain management and other personnel and to manage our
growth effectively; potential product liability claims; potential
healthcare fraud and abuse claims; healthcare legislative reform;
and our ability to obtain and maintain intellectual property
protection for our technology and products. These and additional
risks and uncertainties are described more fully in the Company's
filings with the Securities and Exchange Commission, particularly
those factors identified as "risk factors" in the annual report on
Form 10-K filed March 28, 2016. We are providing this
information as of the date of this press release and do not
undertake any obligation to update any forward-looking statements
contained in this document as a result of new information, future
events or otherwise.
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SOURCE EnteroMedics Inc.