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Investing.com -- Envoy Medical Inc (NASDAQ:COCH) stock plunged 37.8% in premarket trading Wednesday after the hearing health company announced a registered direct offering that would dilute existing shareholders.
The company revealed it has entered into definitive agreements to sell approximately 3 million shares of its Class A common stock at $1.33 per share, in an offering priced at-the-market under Nasdaq rules. The offering is expected to raise about $4 million in gross proceeds before fees and expenses.
In addition to the share sale, Envoy Medical will issue unregistered warrants to purchase up to 9,022,572 shares of Class A common stock in a concurrent private placement. These warrants will have an exercise price of $1.33 per share, can be exercised immediately, and will expire 24 months after the effective date of the registration statement covering the resale of the underlying shares.
H.C. Wainwright & Co. is serving as the exclusive placement agent for the transaction, which is expected to close around October 9, 2025.
If the warrants are fully exercised on a cash basis, they could potentially bring in an additional $12 million in gross proceeds, though the company noted there is no assurance that any of the warrants will be exercised.
Envoy Medical, which focuses on developing fully implanted hearing solutions, stated it intends to use the net proceeds for working capital and general corporate purposes.
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