NeuroMetrix (NSDQ:NURO) said yesterday it inked a securities purchase agreement with a private institutional healthcare investor for 13,800 shares of Series C convertible preferred stock at $1,000 per share, raking in $13.8 million total.
The round also included 2 series of warrants to purchase approximately 10.8 million shares of common stock at $2.30 per share, according to the company.
NeuroMetrix expects that approximately $6.3 million of the new funds will be used to redeem 63,000 shares of Seris B convertible preferred stock held by the investor, and the balance will be used for general working capital purposes.
Rodman & Rensshaw acted as the placement agent for the transaction, and the offering is expected to close tomorrow, according to a press release.
Series C convertible preferred stock from the round is convertible to approximately 5.4 million shares of common stock at $2.55 per share, the company said, and only entilted to dividends if the company pays dividends on common stock .
The news is a positive turn for the company, who earlier this month pulled the trigger on a 1 for 4 reverse split of its common stock.
The move was initially announced on December 1, primarily enacted to increase per share trading price to satisfy the NASDAQ Capital Market’s $1.00 minimum bid price requirement, NeuroMetrix said.
As a result, every 4 shares of the Waltham, Mass.-based company’s stock were consolidated into 1 issued and outstanding share, with no fractional shares issued.