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MiMedx Group (OTC PINK: MDXG closed $150 million private equity and debt financings

July 2, 2020 11:32am

MDXG opened UP +0.08 at $5.40

Under the Securities Purchase Agreement, MDXG is issuing shares of a newly created Series B Convertible Preferred Stock for an aggregate purchase price of $100,000,000 with $90,000,000 being made by an entity controlled by EW Healthcare Partners and $10,000,000.

The Series B Convertible Preferred Stock, together with any accrued and unpaid dividends thereon, may be converted MDXG’s common stock at any time at a conversion price of $3.85 per share

The Series B Convertible Preferred Stock carries a cumulative annual dividend of 4% for the first 12 months following the closing and 6% thereafter.

Under the Loan Agreement, Hayfin is providing MDXG with a five-year term loan facility in the aggregate principal amount of $50 million, the full amount of which is being borrowed and funded, and a one-year, delayed draw term loan facility in the aggregate principal amount of $25 million, which is not currently being drawn or funded.

The Facilities bear interest at a rate equal to LIBOR (subject to a floor of 1.5%) plus a margin of 6.75%. The margin will be eligible to decrease to 6.5% or 6.0% after December 31, 2020, based on future total net leverage levels.

The Bottom Line: The financing consists of an equity financing pursuant to a Securities Purchase Agreement with an entity controlled by EW Healthcare Partners and certain funds managed by Hayfin Capital Management LLP (“Hayfin”), and a debt financing pursuant to a Loan Agreement with Hayfin. As part of the transaction, EW Healthcare Partners has designated Martin P. Sutter and William A. Hawkins III to serve on the Company’s board as preferred directors.

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