Endologix inks debt refinancing deal, looks to raise $52m

Endologix (NSDQ:ELGX) said today that it is looking to raise $52 million in a new offering of its common shares and that it inked debt exchange agreements with certain holders of its senior convertible notes.

In its private placement deal, the Irvine, Calif.-based company said it plans to float approximately 7.9 million new shares of its common stock at a price of $6.61 per share.

Endologix said it expects to collect approximately $49 million after payment of fees and expenses, and that the money will be used to support working capital and general corporate purposes.

The company said that it also entered into an exchange agreement with two holders of its 3.25% senior convertible notes due 2020.

In the deal, the investors agreed to exchange an aggregate of approximately $73 million of 3.25% notes plus accrued interest for approximately $67 million of 5% convertible senior notes due 2024 at a rate of $900 principal amount of 5% notes for every $1000 principal amount of 3.25% notes.

Endologix added that Deerfield has also agreed to amend its existing facility agreement and credit agreement it previously inked.

“Today’s announcement represents another step forward for Endologix. The transactions announced today will allow us to focus our efforts on continued execution while investing in bringing evidence-driven products to market. Our supportive partners worked diligently with us to structure these transactions, and I am proud of our team’s persistence in getting this agreement finalized, ensuring that we can continue to deliver innovation to patients in need,” CEO John Onopchenko said in a prepared statement.

“The financing announced today will strengthen our balance sheet and provide us with a clear path to achieving operating cash flow breakeven in 2021. We are excited to continue working towards re-establishing durable, predictable growth in the markets we serve. We will remain focused on managing operating expenses while increasing commercial productivity and strategically investing in innovative therapies and related clinical studies for the treatment of AAA,” CFO Vaseem Mahboob said in a press release.

Last month, Endologix said that its board of directors set the ratio for its upcoming reverse stock split at 1-for-10.

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