PHILADELPHIA, Aug. 9, 2012 /PRNewswire/ -- Echo Therapeutics, Inc. (Nasdaq: 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 Platinum-Montaur Life Sciences, LLC (Montaur) will provide Echo a credit facility of up to $20 million. The company believes that this transaction will provide Echo with the capital resources needed to implement Echo's plans to commercialize Symphony.
The commitment letter provides that Echo will be able to borrow up to $5 million initially, at 10% interest per annum. Upon attaining certain key regulatory and clinical study objectives, the credit facility will increase in $3 million increments, with a maximum increase of $15 million. On closing, Echo will issue Montaur 4 million warrants with a term of five years and an exercise price of $2 per share. Additionally, Echo will issue 1 million five year warrants per $1 million borrowed, with an exercise price ranging from $2 to $4 per share, depending on the market price of Echo's common stock at the time of the applicable draw. The loan matures five years from the date of closing.
"We are pleased that this new facility allows us to balance our capital structure while attempting to minimize dilution to our shareholders. We believe the increased liquidity and financial flexibility provided by this financial commitment will enhance our ability to aggressively move Symphony toward regulatory clearance in both Europe and the United States," said Patrick T. Mooney, M.D., Chairman and CEO of Echo Therapeutics. "Montaur has proven to be a trusted source for our financing needs, and has demonstrated continued confidence in Echo with their on-going participation in funding our growth."About Echo Therapeutics Echo Therapeutics is developing the Symphony tCGM System as a non-invasive, wireless, transdermal continuous glucose monitoring system for patients with diabetes and for use in hospital critical care units. Echo is also developing its needle-free Prelude SkinPrep System as a platform technology for enhanced skin permeation for delivery of topical pharmaceuticals.
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