SAN DIEGO, Dec. 7 /PRNewswire-FirstCall/ -- CardioDynamics , the innovator and leader of Impedance Cardiography (ICG) technology, today announced that it entered into an amendment of the $5.25 million 8% subordinated convertible debt securities with its largest institutional shareholder.
The amendment extends the term of the convertible note from three years to five years, adds an investor put option under which the holders may elect to be repaid at the end of the third year, and eliminates certain anti-dilution language that required complex embedded derivative accounting treatment under Statement of Financial Standards (SFAS) 133. As a result of the amendments, the Company will no longer be required to record quarterly conversion option valuation adjustments, which totaled $1.5 million during the second and third quarters of 2006. In addition, the Company will no longer be required to record non-cash accounting charges related to the elimination of the implied discount on the convertible notes, which totaled $236,000 in the second and third quarters of 2006.
"We are very pleased to complete this amendment with our largest institutional shareholder," stated Michael K. Perry, CardioDynamics' Chief Executive Officer. "These amendments will eliminate the historically large non-cash adjustments for the quarterly conversion option valuation, $2.0 million of remaining non-cash implied discount charges, as well as roughly $50,000 of annual accounting expenses required to value and report the effects of the note on a quarterly basis. We believe that eliminating these quarterly non-cash accounting fluctuations will provide investors better visibility to the true operating performance of the business and save time and effort of our Finance team as well as expenditures with the external auditors and valuation specialists."
About CardioDynamics:
CardioDynamics , the ICG Company, is the innovator and leader of breakthrough medical technology called Impedance Cardiography (ICG). The Company develops, manufactures and markets noninvasive diagnostic and monitoring technologies and electrodes. The Company's ICG Systems are being used by physicians around the world to help battle the number one killer of men and women -- cardiovascular disease. Partners include GE Healthcare and Philips Medical Systems. For additional information, please refer to the company's Web site at www.cdic.com.
Forward-Looking (Safe Harbor) Statement:
Except for historical and factual information contained herein, this press release contains forward-looking statements the accuracy of which is necessarily subject to uncertainties and risks including the Company's primary dependence on the BioZ product line, and various uncertainties characteristic of early growth companies, as well as other risks detailed in the Company's filings with the SEC, including its 2005 Form 10-K. The Company does not undertake to update the disclosures contained in this press release.
CardioDynamicsCONTACT: Steve Loomis, Chief Financial Officer of CardioDynamics,+1-800-778-4825, ext. 1015, sloomis@cardiodynamics.com
Web site: http://www.cdic.com/
