FRANKLIN, Mass., Feb. 12 /CNW/ -- Echo Therapeutics, Inc. (OTC Bulletin
Board: ECTE), a specialty pharmaceuticals and diagnostics company, announced
today that it had completed an approximately $2.3 million private financing
with Montaur Capital through Platinum Long Term Growth VII, LLC and certain
other select institutional and strategic investors of senior unsecured
convertible notes and warrants.
The $2,292,459 in aggregate principal amount of Senior Convertible Notes
to be issued in the financing will bear interest annually at a rate of 8.0%
per annum and will provide investors with the right to convert principal into
shares of Echo Therapeutics common stock at $1.35 per share. The conversion
price is subject to weighted average anti-dilution protection, excluding
certain customary exceptions. The notes have a three-year term and Echo may
elect to make payments of interest in cash, additional notes, or stock.
Additionally, the investors received warrants to purchase 849,058 shares
of common stock at an exercise price of $1.69 per share for a term of five
years. The warrants provide for full anti-dilution protection to the holders
and allow for cashless exercise.
In connection with the financing, certain holders of Echo's Senior
Promissory Bridge Notes, dated as of September 14, 2007, exchanged their
Bridge Notes at 120% of the outstanding principal and interest of the Bridge
Note as payment toward the purchase price of the Senior Convertible Notes
purchased by such holders. Accordingly, Echo issued notes in the financing in
the aggregate principal balance of $1,592,459 to the former holders of the
Bridge Notes upon their surrender of the Bridge Notes, and Echo received gross
cash proceeds in the amount of $700,000 in connection with the financing.
Echo expects to use the net proceeds from the offering for product
development, working capital and general corporate purposes.
The securities issued in the financing have not been registered under the
Securities Act of 1933, as amended, and may not be offered or sold in the
United States in the absence of an effective registration statement or an
exemption from the registration requirements under the Securities Act. This
notice does not constitute an offer to sell or the solicitation of an offer to
buy securities, nor shall there be any sale of the securities in any state in
which such offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of such state.
About Echo Therapeutics
Echo Therapeutics is a platform-enabled specialty pharmaceuticals and
diabetes management company. Echo's Symphony(TM) CTGM System is a new needle-
free, wireless, continuous transdermal glucose monitoring system focused on
changing the paradigm of invasive, episodic glucose testing in diabetes home
use and hospital critical care settings. Echo's patented AzoneTS(TM)
transdermal drug delivery technology is focused on building a pipeline of
proprietary reformulations of specialty pharmaceutical products previously
approved by the U.S. Food and Drug Administration (FDA). Echo is developing
most of its AzoneTS pipeline in accordance with the FDA's Section 505(b)(2)
guidelines. Durhalieve(TM), Echo's lead AzoneTS drug candidate, is an advanced
topical reformulation of triamcinolone acetonide for treatment of
corticosteroid responsive dermatoses. Echo has submitted its Durhalieve New
Drug Application (NDA) to the FDA.
This press release contains forward-looking information that involves
risks and uncertainties, including statements regarding Echo's plans,
objectives, expectations and intentions. Such statements include, without
limitation, statements regarding Echo's offering of convertible senior notes.
Factors that could adversely affect Echo's business and prospects are
described in Echo's filings with the Securities and Exchange Commission. Echo
expressly disclaims any obligation or undertaking to release publicly any
updates or revisions to any such statements to reflect any change in Echo's
expectations or any change in events, conditions or circumstances on which any
such statement is based.
Investor Relations Contacts:
Patrick T. Mooney, M.D., CEO
Echo Therapeutics, Inc.
Stern Investor Relations
For further information:
For further information: Investor Relations, Patrick T. Mooney, M.D.,
CEO of Echo Therapeutics, Inc., +1-508-530-0329; or Lilian Stern of Stern
Investor Relations for Echo Therapeutics, Inc., +1-212-362-1200 Web Site: