Sutura, Inc.
OTC Bulletin Board : SUTU

Sutura, Inc.

August 09, 2006 11:41 ET

Sutura Announces Terms of $4.1 Million Financing

Company Reports Second Quarter Sales and Review of Distribution Strategies

FOUNTAIN VALLEY, CALIFORNIA--(CCNMatthews - Aug. 9, 2006) - Sutura, Inc. ("Sutura") (OTCBB:SUTU), a California-based medical device company, announced today that it has entered into a term sheet with Whitebox Advisors, LLC to complete a $4.1 Million round of additional financing. The term sheet incorporates $2.1 million recently invested by certain affiliates of Whitebox Advisors in Sutura as well as a commitment to invest an additional $2.0 million in the Company.

The Company also announced today that its second quarter sales for fiscal year 2006 were $153,689; a 300% increase over Q2 2005, but down slightly from Q1 2006. Anthony Nobles, CEO/President of Sutura stated "While our sales performance is slightly below expectations, which we believe is primarily due to the long evaluation and adoption process for new medical procedures, we are encouraged by the favorable customer response and patient outcomes achieved with the SuperStitch from the core accounts we have been able to develop."

"The first two full quarters of commercial launch in the US has illuminated the importance of a well defined clinical training program, and account coverage program. Sutura is very successful in accounts where we have dedicated resources and the appropriate evaluation time for physician training. We are also implementing several improvements to the product that are intended to lessen the learning curve process and improve product performance."

Additionally, Sutura announced it will begin strategic discussions with distribution partners. Sutura intends to increase exposure of the SuperStitch through distribution with a strategic partner. "We believe that with the right strategic partner we can more broadly increase sales," said Nobles.

The financing term sheet provides, among other things, that the $2.1 million of secured debt recently invested by Whitebox affiliates will convert into common stock at a conversion rate of $0.08 per share; the additional $2.0 million commitment will be an equity investment in common stock, also at $0.08 per share, and Whitebox Advisors will be issued a warrant to purchase 10,250,000 shares of common stock at an exercise price of $0.08 per share. Also, the term sheet provides that all interest payments otherwise due and payable to Whitebox and it affiliates on all Whitebox financings which are or become due and payable from June 1, 2006 through December 31, 2006 will not require cash payment, but instead will be paid-in-stock, with the per share price to be determined by a formula based on the current trading price. The per share conversion price for interest payments currently due and payable is $0.08.

"We appreciate Whitebox's continued support of our company," noted Nobles. Dave Teckman, a Sutura board member and a director of Whitebox, added, "Our continued financial support demonstrates that Whitebox remains committed to Sutura and its mission, including this recent funding commitment, Minneapolis-based Whitebox and its affiliates will have invested a total of $20.7 million in Sutura."

About Sutura, Inc.

Sutura®, Inc. (www.suturaus.com) is a medical device company that has developed a line of innovative, minimally invasive, vascular suturing devices to suture the puncture created in arteries during open surgery and catheter-based procedures. The Company's line of SuperStitch medical devices provide sutured closure of the arteriotomy site utilizing the existing catheter sheath introducer or cannula during fluoroscopically guided procedures and directly through the open arteriotomy during open surgical procedures.

Within the United States the 8F & 6F SuperStitch devices are available for use in performing vascular stitching in general surgery, including endoscopic procedures. It is not intended for blind closure of an arteriotomy site. The SuperStitch 8F & 6F is approved in the European Union and CE marked with the indication for use as follows: The SuperStitch is indicated for use in performing vascular stitching in general surgery, including endoscopic procedures. In the EU there is no requirement for the use of fluoroscopic guidance. Sutura's headquarters are in Fountain Valley, California. "Sutura®" and "SuperStitch®" are registered trademarks of Sutura, Inc.

Forward-Looking Information Is Subject to Risk and Uncertainty

Certain statements in this press release may contain projections or "forward-looking" information (as defined in the Private Securities Litigation Reform Act of 1995) that involve risk and uncertainty. The words "aim", "plan", "likely", "believe", "expect", "anticipate", "intend", "estimate", "will", "should", "could", "may", "appears", and other expressions that indicate future events and trends identify forward-looking statements. These statements are not guaranties of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Forward-looking statements are based upon assumptions as to future events that may not prove to be accurate. Actual outcomes and results may differ materially from what we express or forecast in these forward-looking statements. As a result, these statements speak only as of the date they were made and we undertake no obligation to publicly update or revise any forward-looking statements. Our actual results and future trends may differ materially from our forward-looking statements depending on a variety of factors including the acceptance of the SuperStitch® devices by medical providers and the marketplace in general and the success of the proposed sales and marketing plan, the ability of the company to establish a successful distribution relationship with a strategic partner, the continued growth of the vessel closure marketplace and the company's ability to continue to expand and protect its technology patents.

Contact Information

  • Sutura, Inc.
    Barry Forward
    Corporate Communications
    1-866-676-8386
    www.suturaus.com