Transaction Information
Ra Medical Systems, Inc. (NYSE American: RMED) ("Ra Medical" or the "Company") announced a reduction in the exercise price of all existing warrants that were issued in the February 2022 public offering, consisting of Series A Warrants and Series B Warrants, from $0.50 per share to $0.28 per share, and entry into a non-binding term sheet to merge with privately held Catheter Precision Inc. ("Catheter Precision").
On July 22, 2022, Ra Medical entered into warrant inducement offer letters with certain investors to immediately exercise up to an aggregate of 22.2 million of the Series A Warrants held by such investors at an exercise price of $0.28, with none of the investors electing to exercise any Series B Warrants. Investors who exercise their Series A Warrants will receive additional Series C Warrants to purchase 100% of the shares exercised pursuant to the Series A Warrants and which will, among other terms, have an exercise price of $0.28 and a term of five years. Ra Medical expects to receive aggregate gross proceeds of approximately $6.2 million from the exercise of the Series A Warrants. The Series A Warrants have been registered pursuant to a registration statement on Form S-1 and were issued pursuant to an Underwriting Agreement, dated as of February 4, 2022. The Series C Warrants and the shares underlying the Series C Warrants are unregistered and are being issued in a private placement pursuant to Section 4(a)(2) of the Securities Act of 1933 (the "Securities Act").
Non-binding Letter of Intent with Catheter Precision
On June 18, 2022, the Company signed a non-binding summary of proposed terms (the "Term Sheet") with Catheter Precision, to acquire 100% of the outstanding equity interests of Catheter Precision (the "Merger"). Pursuant to the terms of the Term Sheet, Catheter Precision securityholders would, after giving effect to the proposed Merger and excluding any additional offering of the Company's securities, own 83.3% of the equity and equity holders of Ra Medical would own 16.7% of the equity of the combined company on a fully diluted basis. The contemplated business combination would give Ra Medical investors exposure to Catheter Precision's innovative devices that are designed to improve treatment of cardiac arrhythmias, while allowing the combined company the ability to explore funding its strategic initiatives for the Catheter Precision devices through the public capital markets.
The Company has not entered into a binding agreement with Catheter Precision with respect to the Merger. Both parties are currently completing their respective due diligence review of the other party and are continuing to negotiate the terms of a definitive merger agreement. Accordingly, the Company cannot provide any assurance that it will effect the Merger with Catheter Precision or, even if it is able to consummate such a Merger, that the terms of any such Merger will be on the terms set forth in the term sheet or that the intended benefits of the Merger will be fully realized. The Merger is also subject to specified conditions precedent that must be satisfied or waived, including certain conditions precedent that are subject to the approval or consent of third parties. The Company cannot assure you that all of the conditions precedent will be satisfied or waived or that it will receive any of the required third party consents or approvals or able to satisfy or waive all the conditions precedent to consummate the Merger. If the conditions precedent are not satisfied or waived in a timely manner or at all, the Merger may not occur or may be delayed, and the Company may lose some or all of the intended benefits of the proposed Merger with Catheter Precision.
Additional information regarding the Ra Medical warrant repricing and non-binding Term Sheet with Catheter Precision is available in a Form 8-K filed with the Securities and Exchange Commission (the "SEC").
Ladenburg Thalmann & Co. Inc. acted as the exclusive warrant inducement agent and is acting as financial advisor to Ra Medical in connection with the proposed Merger with Catheter Precision.
About Catheter Precision
Catheter Precision is an innovative U.S.-based medical device company bringing new solutions to market to improve the treatment of cardiac arrhythmias. It is focused on developing groundbreaking technology for electrophysiology procedures by collaborating with physicians and continuously advancing its products. Catheter Precision has a world-class leadership team led by founder and CEO David Jenkins, who has extensive experience growing medical device start-ups. His career includes founding Transneuronix, Inc., which was acquired by Medtronic for $267 million, and EP Medsystems, Inc., which was acquired by St. Jude Medical for $95 million.
About Ra Medical Systems
Ra Medical Systems manufactures the DABRA excimer laser and catheters for the treatment of certain vascular diseases. DABRA has been cleared by the FDA for crossing chronic total occlusions in patients with symptomatic infrainguinal lower extremity vascular disease and has an intended use for ablating a channel in occlusive peripheral vascular disease. In addition, DABRA has been granted CE mark clearance for the endovascular treatment of infrainguinal arteries via atherectomy and for crossing total occlusions. For more information visit www.ramed.com.
The information and material presented is provided for informational purposes only and are not to be used or considered as an offer or the solicitation of an offer to sell or buy any securities mentioned herein.