Ritter Pharmaceuticals Announces Agreement for $6.0 Million At-Market Private Placement

Ritter Pharmaceuticals (Nasdaq:RTTR) a developer of novel therapeutic products that modulate the gut microbiome to treat gastrointestinal diseases (GI) with an initial focus on the development of RP-G28, a drug candidate with the potential to be the first FDA-approved treatment for lactose intolerance (LI), today announced that it has entered into a definitive agreement with certain accredited investors, including two current institutional holders of our Series A convertible preferred stock, a key vendor and a member of the Company’s board of directors, for a private placement of newly designated Series B convertible preferred stock and warrants.

As quoted in the press release:

The securities being offered in the private placement consist of 6,000 shares of a newly designated Series B convertible preferred stock of the Company, with a stated value of $1,000 per share and convertible into shares of our common stock at an initial conversion price per share of $1.30 (subject to adjustment), which is above the $1.23 per share closing price of our common stock as reported on the Nasdaq Capital Market on October 30, 2018. In addition, each investor will receive a warrant to purchase a number of shares of common stock equal to 50% of the aggregate number of shares of common stock into which their Series B convertible preferred stock is initially convertible. The warrants will be exercisable immediately for a five-year period and have an initial exercise price of $1.30 per share (subject to adjustment). Certain investors in the private placement who currently own shares of our Series A convertible preferred stock will also exchange, on a 1-for-1 share basis, their Series A preferred shares for shares of a newly designated Series C convertible preferred stock of the Company, with a stated value of $1,000 per share and convertible into shares of our common stock at an initial conversion price per share of $1.64 (subject to adjustment). The maximum aggregate number of shares of common stock that may be issued by the Company upon conversion of the Series C convertible preferred stock will be limited to 1,146,354 shares, representing 19.99% of the shares of our common stock outstanding immediately prior to execution of the definitive agreement for the private placement, unless we obtain stockholder approval to issue shares in excess of the Exchange Cap in accordance with applicable rules of the Nasdaq Capital Market.

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