SEC Form 4 · accession 0001235802-17-000060
ReShape Lifesciences Inc. · RSLS
Statement of changes in beneficial ownership, as filed. Original on EDGAR ↗
Reporting owner
Rajesh Nihalani
Officer — Chief Technology Officer · 10% Owner
Period of report
May 22, 2017
Accepted (ET)
May 24, 2017 · 6:22 pm EDT
Rule 10b5-1 plan
unknown — predates the checkbox
Issuer CIK
0001371217
Table I — non-derivative securities
| Security | Date | Code | Shares | Price | A/D | Owned after | D/I | Nature of ownership |
|---|---|---|---|---|---|---|---|---|
| Common Stock, $0.01 par value per shareF1 | May 22, 2017 | A | 978,845 | — | A | 978,845 | D |
Table II — derivative securities
| Security | Conv. / exercise price | Date | Code | Shares | A/D | Exercisable | Expires | Underlying | Underlying shares | Owned after | D/I |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Non-voting Conditional Convertible Preferred StockF3,F2 | — | May 22, 2017 | A | 709,100 | A | — | — | Common Stock | 3,545,499 | 709,100 | D |
| Non-voting Conditional Convertible Preferred StockF2,F4,F5 | — | May 22, 2017 | A | 29,108 | A | — | — | Common Stock | 145,541 | 29,108 | I |
Explanation of responses
- F1Received in exchange for 14,000,000 shares of common stock of BarioSurg, Inc. (BarioSurg) pursuant to the Agreement and Plan of Merger, by and among EnteroMedics Inc. (EnteroMedics), BarioSurg, Acorn Subsidiary Inc., a wholly-owned subsidiary of EnteroMedics, Acorn Subsidiary Holdings LLC, a wholly-owned subsidiary of EnteroMedics, and the stockholder representative named therein, (the Merger Agreement), which became effective on May 22, 2017 (the Effective Date). The Merger Agreement placed a value on EnteroMedics common stock of $4.78, which was equal to the five trading day average per share closing price of EnteroMedics as reported on the NASDAQ Capital Market immediately prior to the Effective Date.
- F2Each share of non-voting conditional convertible preferred stock will automatically convert into five shares of EnteroMedics' common stock, subject to and contingent upon the post-closing approval of EnteroMedics' stockholders in accordance with the NASDAQ Stock Market Rules. The non-voting conditional convertible preferred stock contains the rights, preferences, powers and priviliges specified in the certificate of designation.
- F3Of the 709,099.80 shares of non-voting conditional convertible preferred stock issued to the reporting person in the merger, 70,909.98 are currently being held in escrow and subject to forfeiture during the nine-month period following the Effective Date to satisfy claims arising as a result of BarioSurg's breach of any of its representations and warranties or covenants in the Merger Agreement.
- F4Represents shares of non-voting conditional convertible preferred stock held in escrow on behalf of BarioSurg's stockholders and subject to forfeiture during the nine-month period following the Effective Date to satisfy claims arising as a result of BarioSurg's breach of any of its representations and warranties or covenants in the Merger Agreement. The reporting person may be deemed to be the beneficial owner of such shares as a result of his role as stockholder representative pursuant to the Merger Agreement.
- F5In connection with and as a condition to the execution of the Merger Agreement, EnteroMedics and the reporting person entered into a voting agreement and irrevocable proxy pursuant to which the reporting person agreed to vote these shares of non-voting conditional convertible preferred stock (assuming conversion into voting common stock upon the terms set forth in the Merger Agreement and certificate of designation) in accordance with the recommendation of the Board of Directors. Following the release of the shares from the escrow, these shares will be released to the BarioSurg stockholders in accordance with the Merger Agreement.