ETRM Enteromedics

EnteroMedics, Inc. (the “Company”) is listed on The Nasdaq Capital Market (“Nasdaq”) and, accordingly, for continued listing must comply with Nasdaq’s minimum shareholders’ equity requirement of $2.5 million and Nasdaq’s $1.00 per share bid price requirement. On December 28, 2016, the Company effected a 1 for 70 reverse stock split. Following the reverse stock split, the closing bid price of the Company’s common stock remained above $1.00 per share for more than 10 consecutive trading days. To regain compliance with the minimum shareholders’ equity requirement, the Company closed an underwritten public offering of units for gross proceeds of $19.0 million on January 23, 2017.

The Company attended a hearing before a Nasdaq Listing Qualifications Panel (the “Panel”) on January 12, 2017, related to the Company’s previously reported non-compliance with Nasdaq’s minimum shareholders’ equity and $1.00 bid price requirements. On January 30, 2017, the Panel issued a decision deeming the Company in compliance with the $1.00 per share bid price requirement and requiring the Company to make a filing demonstrating its return to compliance following the closing of the underwritten public offering referenced herein. As a result of the underwritten public offering, the Company believes that its shareholders’ equity now exceeds $2.5 million as of the date of this filing. The Company is awaiting confirmation from Nasdaq that it now exceeds all applicable requirements for continued listing.