• Completes merger with TransEnterix, Inc., building foundation for growth
• Closes $30.2 million financing, expanding shareholder base
• Pre-clinical testing for SurgiBot™ ongoing, expecting 2014 regulatory submissions
• Strengthens management team, appointing Joseph Slattery at Executive Vice President & CFO
• Company to change name to TransEnterix, Inc.

RESEARCH TRIANGLE PARK, N.C.--(BUSINESS WIRE)-- SafeStitch Medical, Inc. ("SafeStitch") (OTCBB:SFES), which recently merged with TransEnterix, Inc.("TransEnterix"), a medical device company that is pioneering the use of flexible instruments and robotics to improve how minimally invasive surgery is performed, today announced its operating results for the third quarter ended September 30, 2013.

Comparison of Selected Financial Results (in thousands, except per share data)
		Three Months Ended September 30,
		2013			2012
Total revenue		$ 362			$ 531
Net loss		$ (11,265	)		$ (3,670	)
Net loss per common share		$ (0.21	)		$ (0.68	)
Weighted average common shares outstanding		52,921			5,391

Revenues were $362,000 in the third quarter of 2013, representing a 32% decrease from revenues of $531,000 in the third quarter of 2012. The decrease in revenue was primarily due to a reduction U.S. sales personnel, resulting in a decrease in sales of our SPIDER® Surgical System.

Net loss was $11.3 million in the third quarter of 2013, compared to a net loss of $3.7 million in the third quarter of 2012. Net loss per common share was $0.21 in the third quarter of 2013 based on 52.9 million weighted average common shares outstanding compared to a net loss per common share of $0.68 in the third quarter of 2012 based on 5.4 million weighted average common shares outstanding.

Cash and cash equivalents were $23.8 million as of September 30, 2013.

On October 29, 2013, SafeStitch stockholders took action to approve changing the name of the company to "TransEnterix, Inc." SafeStitch anticipates this name change to become effective in the fourth quarter of 2013, after which the common stock will trade on the OTCBB under the symbol "TRXC."

"The recently completed merger of TransEnterix and SafeStitch and concurrent $30.2 million financing provide us with a strong foundation for growth," said Todd Pope, President and Chief Executive Officer of SafeStitch Medical, Inc. "We are enthusiastic about the market opportunity for our SurgiBot system and look forward to bringing this innovative surgical robotic solution to the market."

Conference Call

SafeStitch Medical, Inc. will host a conference call on Tuesday, November 12, 2013 at 4:30 pm ET to discuss its third quarter financial results. To listen to the conference call on your telephone, please dial (866) 318-8617 for domestic callers or (617) 399-5136 for international callers approximately ten minutes prior to the start time. The call will be concurrently webcast. To access the live audio broadcast or the archived recording, use the following link www.transenterix.com/investors.php

Financial Statements

The merger between SafeStitch and TransEnterix is treated as a reverse acquisition for financial accounting and reporting purposes, with SafeStitch as the acquired entity and TransEnterix as the acquirer. As a result, the assets and liabilities and the historical operations that are reflected in the financial statements disclosed herein and filed with the SEC are those of TransEnterix until September 3, 2013, at which time the assets, liabilities and results of operations have been consolidated with the assets, liabilities and results of operations of SafeStitch.

About SafeStitch Medical, Inc. (TransEnterix)

SafeStitch Medical, Inc. (TransEnterix) is a medical device company that is pioneering the use of flexible instruments and robotics to improve how minimally invasive surgery is performed. The Company is focused on the development and commercialization of SurgiBot, a novel patient side minimally invasive surgical robotic system. For more information, visit the Company's websites at www.transenterix.com and www.safestitch.com.

Forward Looking Statements

This press release includes statements relating to our efforts to gain favorable coverage decisions for our products that are based on our current beliefs and assumptions. These statements constitute "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and are intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Such statements are subject to risks and uncertainties that are often difficult to predict, are beyond our control, and which may cause results to differ materially from expectations. Factors that could cause our results to differ materially from those described include, but are not limited to, whether the merger between SafeStitch and TransEnterix will be successful, whether the combined company will be successful in 2014 and beyond, the pace of adoption of our product technology by surgeons, the outcome of coverage and reimbursement decisions by the government and third party payors, the success and market opportunity of our continuing and new product development efforts, including the SurgiBot system, the effect on our business of existing and new regulatory requirements, and other economic and competitive factors. For a discussion of the most significant risks and uncertainties associated with SafeStitch's business, please review SafeStitch's filings with the Securities and Exchange Commission (SEC), including its Annual Report on Form 10-K for the year ended December 31, 2012, the Form 8-K filed on September 6, 2013 and subsequent SEC reports. You are cautioned not to place undue reliance on these forward looking statements, which are based on SafeStitch's expectations as of the date of this press release and speak only as of the date of this press release. We undertake no obligation to publicly update or revise any forward looking statement, whether as a result of new information, future events or otherwise.

SafeStitch Medical, Inc. Consolidated Statements of Operations and Comprehensive Loss (in thousands, except per share amounts) (Unaudited)
		Three months ended								Nine months ended
		September 30,								September 30,
		2013				2012				2013				2012
Sales		$	362			$	531			$	1,212			$	1,741
Operating Expenses
Cost of goods sold			2,059				1,077				4,096				3,465
Research and development			2,909				1,228				7,855				4,552
Sales and marketing			437				1,025				1,490				2,991
General and administrative			1,279				777				2,665				2,176
Merger expenses			2,891				-				2,891				-
Total Operating Expenses			9,575				4,107				18,997				13,184
Operating Loss			(9,213	)			(3,576	)			(17,785	)			(11,443	)
Other (Expense) Income
Remeasurement of fair value of preferred stock warrant liability			(1,800	)			-				(1,800	)			-
Interest expense, net			(252	)			(94	)			(742	)			(251	)
Total Other (Expense) Income, net			(2,052	)			(94	)			(2,542	)			(251	)
Net Loss		$	(11,265	)		$	(3,670	)		$	(20,327	)		$	(11,694	)
Other comprehensive income (loss)			-				-				-				-
Comprehensive loss		$	(11,265	)		$	(3,670	)		$	(20,327	)		$	(11,694	)
Net loss per share - basic and diluted		$	(0.21	)		$	(0.68	)		$	(0.95	)		$	(2.17	)
Weighted average common shares outstanding - basic and diluted			52,921				5,391				21,409				5,391

SafeStitch Medical, Inc. Consolidated Balance Sheets (in thousands, except share amounts)
		September 30,				December 31,
		2013				2012
		(unaudited)
Assets
Current Assets
Cash and cash equivalents		$	23,829			$	8,896
Short-term investments			1,104				907
Accounts receivable, net			294				536
Accounts receivable - related party			24				-
Interest receivable			10				16
Inventory, net			766				1,382
Other current assets			1,033				235
Total Current Assets			27,060				11,972
Restricted cash			375				375
Property and equipment, net			1,823				1,767
Intellectual property, net			2,866				3,241
Intangible assets			10				-
Goodwill			93,670				-
Other long term assets			129				205
Total Assets		$	125,933			$	17,560
Liabilities, Redeemable Convertible Preferred Stock, and Stockholders' Equity (Deficit)
Current Liabilities
Accounts payable		$	2,567			$	515
Related party payable			-				6
Accrued expenses			1,078				538
Note payable - current portion			3,795				1,519
Total Current Liabilities			7,440				2,578
Long Term Liabilities
Preferred stock warrant liability			-				109
Note payable - less current portion			5,604				8,481
Total Liabilities			13,044				11,168
Commitments and Contingencies
Redeemable Convertible Preferred Stock
Series A Redeemable Convertible Preferred Stock, $0.001 par
value, 5,734,402 shares authorized; and 5,696,261 shares
issued and outstanding at December 31, 2012			-				19,885
Series B Redeemable Convertible Preferred Stock, $0.001 par
value, 11,504,298 shares authorized; and 11,489,972 shares
issued and outstanding at December 31, 2012			-				40,016
Series B-1 Redeemable Convertible Preferred Stock, $0.001 par
value, 48,454,545 shares authorized; and 45,998,220 shares
issued and outstanding at December 31, 2012			-				15,104
Stockholders' Equity (Deficit)
Series B Convertible Preferred Stock, $0.01 par value, 25,000,000
shares authorized, 7,569,704.4 shares issued and outstanding
at September 30, 2013			30,197				-
Common stock $0.001 par value, 225,000,000 and 113,000,000 shares authorized
at September 30, 2013 and December 31, 2012, respectively; 167,504,447 and
4,674,495 shares issued and outstanding at September 30, 2013 and December 31, 2012,
respectively			168				5
Additional paid-in capital			172,757				1,288
Accumulated deficit			(90,233	)			(69,906	)
Total Stockholders' Equity (Deficit)			112,889				(68,613	)
Total Liabilities, Redeemable Convertible Preferred Stock, and
Stockholders' Equity (Deficit)		$	125,933			$	17,560

SafeStitch Medical, Inc. Consolidated Statements of Cash Flows (in thousands) (Unaudited)
		2013				2012
Operating Activities
Net loss		$	(20,327	)		$	(11,694	)
Adjustments to reconcile net loss to net cash and cash
equivalents used in operating activities:
Depreciation and amortization			1,064				1,444
Amortization of debt issuance costs			78				23
Remeasurement of fair value of preferred stock warrant liability			1,800				(19	)
Accretion/amortization of bond discount/premium			(1	)			1
Stock-based compensation			484				274
Gain on disposal of property and equipment			32				4
Impairment loss on property and equipment			304				-
Changes in operating assets and liabilities:
Accounts receivable			251				(232	)
Interest receivable			6				(62	)
Inventory			667				(282	)
Other current and long term assets			(527	)			(122	)
Accounts payable			1,444				(351	)
Related party payable			173				(10	)
Accrued expenses			505				125
Net cash and cash equivalents used in operating activities			(14,047	)			(10,901	)
Investing Activities
Purchase of investments			(1,104	)			(4,702	)
Proceeds from sale and maturities of investments			907				-
Cash received in acquisition of a business, net of cash paid			305				-
Purchase of property and equipment			(724	)			(92	)
Proceeds from sale of property and equipment			-				49
Net cash and cash equivalents used in investing activities			(616	)			(4,745	)
Financing Activities
Proceeds from issuance of debt			1,998				4,000
Payment of debt			(601	)			-
Proceeds from issuance of preferred stock, net of issuance costs			28,199				268
Proceeds from exercise of stock options			-				3
Net cash and cash equivalents provided by financing activities			29,596				4,271
Net increase (decrease) in cash and cash equivalents			14,933				(11,375	)
Cash and Cash Equivalents, beginning of period			8,896				14,004
Cash and Cash Equivalents, end of period		$	23,829			$	2,629
Supplemental Disclosure for Cash Flow Information
Interest paid		$	625			$	219
Supplemental Schedule of Noncash Investing and Financing Activities
Issuance of preferred stock warrants and debt issuance costs		$	128			$	63
Conversion of bridge notes to preferred stock		$	1,998			$	-
Conversion of preferred stock warrants to common stock warrants		$	1,909			$	-

Westwicke Partners
Mark Klausner, 443-213-0501
transenterix@westwicke.com

Source: SafeStitch Medical, Inc.

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