Owlet Announces $9 Million Private Placement Financing

Owlet, Inc. (NYSE: OWLT) (“Owlet” or the “Company”) announced today, following recent FDA clearances and strong preliminary fourth quarter results, that it has entered into definitive documentation relating to a sale of shares of its newly issued Series B convertible preferred stock (“Series B preferred stock”) and warrants to purchase its Class A common stock (“common stock”) in a private placement with certain institutional and other accredited investors for gross proceeds to Owlet of approximately $9 million, before deducting offering expenses. The conversion ratio for the Series B preferred stock and exercise price for the warrants reflects a 25% premium to the most recent market closing price on February 23, 2024. The transaction, which involves participation from existing investors, is expected to close on February 28, 2024, subject to customary closing conditions.

Pursuant to the terms of the definitive agreements and the closing of the private placement, Owlet will issue shares of Series B preferred stock that are convertible into approximately 1.2 million shares of common stock. Each purchaser will also receive a warrant to purchase 150% of the number of shares of common stock into which their Series B preferred stock is convertible. The warrants will have a per share exercise price of $7.7125 and will be exercisable by the holder at any time on or after the issuance date for a period of five years.

“As a pioneer of smart infant monitoring, Owlet has built momentum on the back of our two new FDA clearances. This capital is important in supporting that momentum,” said Kurt Workman, Co-founder and CEO. “The Company now has a strong foundation with our new medical devices, expanded distribution and a brand that resonates with parents. I’m grateful for the investors who share our vision and passion for improving pediatric health.”

Workman continued, “I’m proud of the team’s commitment to operating towards achieving a profitable business. We ended the year with over $16 million in cash and cash equivalents and this well-timed capital supports the opportunities ahead for our business as we globally commercialize our two new medical devices.”

Additional details regarding the private placement will be included in a Form 8-K to be filed by Owlet with the Securities and Exchange Commission (“SEC”).

The securities to be issued in the private placement and the underlying shares of common stock issuable upon conversion or exercise of the Series B preferred stock or warrants have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or securities laws of any state or other jurisdiction, and may not be resold absent registration under, or exemption from registration under, the Securities Act. Owlet has agreed to file a registration statement with the SEC registering the resale of the shares of common stock underlying the Series B preferred stock and warrants.