Lehi, Utah-based Owlet’s placement relates to the sale of shares of its newly issued Series B convertible preferred stock and warrants to purchase Class A common stock. The conversion ratio for the stock and warrants reflects a 25% premium to the company’s most recent closing price on Feb. 23.
Owlet expects the transaction to close on Feb. 28, subject to customary closing conditions.
Under the terms of the agreements, Owlet plans to issue shares of Series B stock convertible into approximately 1.2 million shares of common stock. Each purchaser also received a warrant to purchase 150% of the number of shares of common stock into which their Series B stock is convertible. Owlet priced the warrants at $7.7125 per share. The holder can exercise them at any time on or after the issuance date for five years.
“As a pioneer of smart infant monitoring, Owlet has built momentum on the back of our two new FDA clearances. This capital is important in supporting that momentum,” said Kurt Workman, Owlet co-founder and CEO. “The company now has a strong foundation with our new medical devices, expanded distribution and a brand that resonates with parents. I’m grateful for the investors who share our vision and passion for improving pediatric health.
“I’m proud of the team’s commitment to operating towards achieving a profitable business. We ended the year with over $16 million in cash and cash equivalents and this well-timed capital supports the opportunities ahead for our business as we globally commercialize our two new medical devices.”
More about Owlet
Owlet develops a range of medical devices for delivering better care for babies at home through advanced digital technologies. It received FDA de novo clearance in November 2023 for its Dream Sock over-the-counter pulse oximetry solution for infants.
Dream Sock monitors and displays live health readings and provides health notifications. Readings include pulse rate and oxygen saturation level, while lights and alarms signal when readings fall outside of preset ranges.
Following that clearance, the company launched Dream Sock, along with its BabySat system, last month. BabySat is a pulse oximetry monitoring system that combines hospital-grade accuracy with Owlet’s modern and wire-free sock design. It is intended for infants between 1-18 months and 6-30 pounds with acute or chronic medical conditions.
Owlet designed the device to track live vital signs, but it is distinct from Owlet’s Dream Sock in that it is only available through prescription and allows a healthcare provider to set and adjust customizable alarms for oxygen saturation and pulse rate that are tailored to an infant’s individual needs.
