Xtant Medical Announces Closing of Debt Restructuring
October 01 2020 - 04:05PM
Xtant Medical Holdings, Inc. (NYSE American: XTNT), a global
medical technology company focused on surgical solutions for the
treatment of spinal disorders, today announced that it has
completed its previously announced debt restructuring transaction.
The primary purpose of the restructuring was to
improve Xtant’s capital structure by reducing its outstanding debt,
which the Company expects will facilitate future access to capital
markets for investment in its growth initiatives, and regain
compliance with the NYSE American’s continued listing
standards.
“We are pleased to have completed this debt
restructuring transaction, which significantly reduced Xtant’s
total indebtedness to less than $16 million under our credit
facility, lowered our cost of debt to more serviceable levels, and
will allow us to focus on further improving the Company’s operating
model and growth profile,” said Sean Browne, President and CEO of
Xtant Medical.
As part of the transaction, Xtant issued
approximately 57.8 million shares of its common stock to the
lenders under its credit facility in exchange for approximately
$40.8 million of the aggregate outstanding principal amount of
loans outstanding under the credit facility, as well as, without
duplication, approximately $21.1 million of the outstanding amount
of PIK Interest (as defined in the credit agreement) (such loans
and PIK Interest, referred to as the “exchanging loans”), plus all
other accrued and unpaid interest on the exchanging loans
outstanding as of the closing date, at an exchange price of $1.07
per share.
Xtant and the lenders also amended the credit
agreement to extinguish loans in an aggregate principal amount
equal to the exchanging loans outstanding thereunder together with
all accrued and unpaid interest thereon, add loans in an aggregate
principal amount equal to a portion of the prepayment fee payable
thereunder in respect of the exchanging loans and exchange the
remaining portion of the prepayment fee for an additional 0.9
million shares of its common stock, reduce the amount of additional
credit availability thereunder to $5 million, eliminate the Revenue
Base financial covenant, and reduce the interest rate to a rate per
annum equal to the sum of (i) 7.00% plus (ii) the higher of (x) the
LIBO Rate (as such term is defined in the credit agreement) and (y)
1.00%.
As a result of the completion of the debt
restructuring transaction, OrbiMed Royalty Opportunities II, LP and
ROS Acquisition Offshore LP, which are funds affiliated with
OrbiMed Advisors LLC, own, in the aggregate, approximately 94.5% of
Xtant’s outstanding common stock and all other existing
stockholders of Xtant own approximately 5.5% of the outstanding
common stock. Under the terms of the previously announced
Restructuring and Exchange Agreement between Xtant and the lenders,
Xtant agreed to launch a rights offering after completion of the
debt restructuring to allow Xtant stockholders the opportunity to
purchase Xtant common stock at the same price per share as the
$1.07 per share exchange price used in the debt restructuring.
About Xtant Medical
Holdings, Inc.
Xtant Medical Holdings, Inc.
(www.xtantmedical.com) is a global medical technology company
focused on the design, development, and commercialization of a
comprehensive portfolio of orthobiologics and spinal implant
systems to facilitate spinal fusion in complex spine, deformity and
degenerative procedures. Xtant’s people are dedicated and talented,
operating with the highest integrity to serve our customers.
The symbols ™ and ® denote trademarks and
registered trademarks of Xtant Medical Holdings, Inc. or its
affiliates, registered as indicated in the United States, and in
other countries. All other trademarks and trade names referred to
in this release are the property of their respective owners.
Cautionary
Statement Regarding
Forward-Looking
Statements
This press release contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements include statements
that are predictive in nature, that depend upon or refer to future
events or conditions, or that include words such as “expects,”
“anticipates,” “intends,” “plans,” “believes,” “continue,”
“future,” “will,” “may,” “continue,” similar expressions or the
negative thereof, and the use of future dates. Forward-looking
statements in this release include the Company’s expectations
regarding the effect and benefits of the debt restructuring
transaction and subsequent rights offering. The Company cautions
that its forward-looking statements by their nature involve risks
and uncertainties, and actual results may differ materially
depending on a variety of important factors, including, among
others: risks and uncertainties surrounding the restructuring
transactions, including without limitation, the Company’s ability
to regain compliance with the continued listing standards of the
NYSE American and maintain its listing, and the timing and success
of the anticipated rights offering; the effect of the COVID-19
pandemic on the Company’s business, operating results and financial
condition; the Company’s future operating results and financial
performance; the ability to increase or maintain revenue; the
ability to remain competitive; the ability to innovate and develop
new products; the ability to engage and retain qualified personnel;
government and third-party coverage and reimbursement for Company
products; the ability to obtain and maintain regulatory approvals
and comply with government regulations; the effect of product
liability claims and other litigation to which the Company may be
subject; the effect of product recalls and defects; the ability to
obtain and protect Company intellectual property and proprietary
rights and operate without infringing the rights of others; the
ability to service Company debt, comply with its debt covenants and
access additional indebtedness; the ability to obtain additional
financing and other factors. Additional risk factors are contained
in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2019, as supplemented by subsequent disclosures in the
Company’s Quarterly Report on Form 10-Q for the quarterly period
ended June 30, 2020 and in future Quarterly Reports on Form 10-Q
and Current Reports on Form 8-K. Investors are encouraged to read
the Company’s filings with the SEC, available at www.sec.gov, for a
discussion of these and other risks and uncertainties. The Company
undertakes no obligation to release publicly any revisions to any
forward-looking statements to reflect events or circumstances after
the date hereof or to reflect the occurrence of unanticipated
events, except as required by law. All forward-looking statements
attributable to the Company or persons acting on its behalf are
expressly qualified in their entirety by this cautionary
statement.
Investor Relations Contact
David CareyLazar FINNPh: 212-867-1762Email:
david.carey@finnpartners.com
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