Each class A unit consists of 1 share of common stock and a 5-year warrant to purchase 1 share of common stock with an exercise price of $5.84 per share. Each class B unit consists of 1 share of preferred stock, which is convertible into 188 shares of common stock, and warrants to purchase 188 shares of common stock.
More than 750,000 shares of common sock, 12,500 shares of preferred stock covertible into 2.4 million shares of common stock, and warrants to purchase 3.1 million shares of common stock will be issued in the medical device-maker’s offering.
EnteroMedics has also given the underwriters a 45-day option to purchase nearly 470,000 additional shares of common stock. Ladenburg Thalmann & Co. Inc., is sole book-running manager in connection with the offering.
ETRM shares tumbled 30% to $6.13 in mid-afternoon trading activity today.
In December, the company said that its board declared a 1-for-70 reverse stock split as part of the company’s efforts to regain compliance with the NASDAQ exchange’s $1.00 minimum bid price.
St. Paul, Minn.-based EnteroMedics also said last month that it planned to convert all of the nearly $18.8 million it’s carrying in senior amortizing convertible notes as of Dec. 27. Net proceeds are earmarked for commercialization of the vBloc neuromodulation treatment for weight loss “and for other working capital and general corporate purposes,” the company said.