Echo Therapeutics Receives Funding and Commitment of Approximately $5.5 Million
FRANKLIN, Mass., Jan. 6, 2011 /PRNewswire/ -- Echo Therapeutics, Inc. (OTC Bulletin Board: ECTE), a company developing its needle-free Symphony™ tCGM System as a non-invasive, wireless, transdermal continuous glucose monitoring system and its Prelude™ SkinPrep System for transdermal drug delivery, today announced that it has raised approximately $2.5 million through a series of private placements of the Company's stock and warrants, and it has received a binding commitment for an additional $3 million. The funding was led by the Company's largest shareholder, Platinum Montaur Life Sciences, LLC ("Montaur"). Current investors and other select institutional and accredited investors also participated in the financings. Echo expects to use the net proceeds for product development, clinical studies, working capital and general corporate purposes.
Echo conducted a private placement of common stock and warrants with aggregate proceeds of approximately $2.5 million through a series of closings held from November 2010 through January 2011. Investors purchased units, or partial units, at a price per unit of $25,000, consisting of (i) 25,000 shares of Echo common stock, (ii) Series 1 warrants to purchase 12,500 shares of Echo common stock with an exercise price of $1.50 per share, and (iii) Series 2 warrants to purchase 12,500 shares of Echo common stock with an exercise price of $2.50 per share.
On January 5, 2011, Echo also received a $3 million funding commitment from Montaur. Montaur will advance $1 million of the committed funds to Echo pursuant to a bridge note, which is intended to convert into convertible preferred stock no later than February 1, 2011. Montaur has agreed to invest an additional $2 million through the purchase of convertible preferred stock in monthly installments from February through May 2011.