ROCKAWAY, N.J. - electroCore, Inc. (NASDAQ:ECOR), a bioelectronic medicine and wellness company, has announced the sale of securities to institutional and accredited investors, aiming to generate approximately $9.3 million in gross proceeds.
The transaction involves the issuance of 225,000 pre-funded warrants and an additional 112,500 common stock warrants, alongside a separate private placement of shares and warrants to selected investors, including company directors and officers.
The pre-funded warrants, sold at $6.43 minus $0.001 each, are exercisable immediately at $0.001 per share. Each common stock share is bundled with half a warrant for a combined price of $6.4925, with the warrants exercisable at $6.43 per share and set to expire five years post-issuance. The terms of the warrants offered in the private placement mirror those sold to the institutional investor.
Directors and officers have committed to investing $5.645 million of the total gross proceeds. electroCore intends to allocate the net proceeds towards sales and marketing initiatives, working capital, and general corporate purposes.
The offerings, expected to close on or about June 5, 2024, are subject to customary closing conditions. The pre-funded warrants offered in the direct sale are part of a shelf registration statement filed with the Securities and Exchange Commission (SEC) on January 18, 2022, and declared effective on January 25, 2022.
The securities sold in the private placement are not covered by this registration statement and are being offered pursuant to exemptions from registration under the Securities Act of 1933.
The company has agreed to file a resale registration statement with the SEC for the shares issued in the private placements and those underlying the privately placed pre-funded warrants and warrants following the closing of the transactions.
This announcement is based on a press release statement and does not constitute an offer to sell or a solicitation of an offer to buy the securities mentioned. The sale of these securities will not be conducted in jurisdictions where such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
InvestingPro Insights
As electroCore, Inc. (NASDAQ:ECOR) progresses with its recent securities sale to bolster its financial position, investors may be looking at the company's fundamentals to gauge the potential impact on their investment.
According to InvestingPro data, electroCore has a market capitalization of $38.62 million and has experienced a significant revenue growth of 97.33% in the last twelve months as of Q1 2024, showcasing a strong surge in its financial performance. Despite this, the company's P/E ratio remains negative at -2.3, reflecting market skepticism about its future profitability.
One of the InvestingPro Tips highlights that electroCore holds more cash than debt on its balance sheet, which is a positive sign for investors, indicating a degree of financial stability. However, another tip points out that the company is quickly burning through cash, which may explain the need for the recent fundraising efforts. Moreover, the company does not pay a dividend, which could influence the investment decisions of income-focused shareholders.
Investors interested in a deeper dive into electroCore's financial health and future prospects can find additional InvestingPro Tips on the platform. There are currently 5 more tips available, which could provide valuable insights into the company's valuation and market position. To access these tips, investors may visit InvestingPro's electroCore page. Moreover, those looking to subscribe to InvestingPro for more in-depth analysis can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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