Five-year deal with Platinum-Montaur Life Sciences includes warrants
By Devika Patel
Knoxville, Tenn., Aug. 9 - Echo Therapeutics, Inc. said it arranged a $20 million five-year credit facility with Platinum-Montaur Life Sciences, LLC. The commitment letter provides that Echo will be able to borrow up to $5 million initially. Upon attaining certain objectives, the facility will increase in $3 million increments, for a maximum increase of $15 million.
The loan bears interest at 10%.
Platinum-Montaur also will receive 4 million warrants. The warrants are exercisable for common stock at $2.00 per share for five years. The strike price reflects a 37.93% premium to the Aug. 8 closing share price of $1.45.
Additionally, Echo will issue 1 million five-year warrants for each $1 million borrowed, with an exercise price ranging from $2.00 to $4.00 per share.
Proceeds will be used to commercialize Symphony.
Philadelphia-based Echo Therapeutics is a dual platform-enabled specialty therapeutics and diagnostics company.
| Issuer: | Echo Therapeutics, Inc.
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| Issue: | Credit facility
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| Amount: | $20 million
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| Maturity: | Five years
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| Coupon: | 10%
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| Warrants: | 4 million
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| Warrant expiration: | Five years
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| Warrant strike price: | $2.00
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| Investor: | Platinum-Montaur Life Sciences, LLC
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| Pricing date: | Aug. 9
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| Stock symbol: | Nasdaq: ECTE
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| Stock price: | $1.45 at close Aug. 8
|
| Market capitalization: | $61.5 million
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