St. Louis Business Journal by Matthew Hibbard, Reporter
Medical device company Stereotaxis Inc. has entered into agreements with institutional investors to raise $18.5 million in two financing transactions.
The company also said it amended its credit agreement with Silicon Valley Bank, including extending its revolving credit facility to March 31, 2013. The agreements provide an important lifeline to Stereotaxis. The company raised $15 million in December but its cash dwindled as losses mounted as the company transitioned from an older product to a newer one. Stereotaxis makes robotic navigation systems used during cardiac procedures.
Stereotaxis will raise $10 million by issuing about 21.7 million shares of common stock and six-year warrants to purchase about 21.7 million additional shares at a price of $0.34 per share. It also announced a private placement of about $8.5 million of unsecured debt, which will be converted into common stock at a price of $0.34 per share. With debt placement, the company is also issuing six-year warrants to purchase 25.2 million shares of common stock at a price of $0.34 per share. The debt carries an interest rate of 8 percent and matures on May 7, 2014.
The transactions must be approved by Stereotaxis shareholders. Oppenheimer & Co. served as sole placement agent for each of the financing transactions.
The company plans to use proceeds of the financing for working capital, general corporate purposes and to repay $7 million of revolving credit guaranteed by Alafi Capital and Sanderling Venture Partners. The revolving line of credit will be decreased from $20 million to $13 million after paying down $7 million of the guaranteed portion. Sanderling and Alafi have agreed to extend their guarantees for an amount of $3 million of a portion of the Silicon Valley Bank revolving credit, in exchange for warrants to purchase up to 2.3 million shares of common stock, the company said.
“With the support from new and existing investors, we have improved our financial position and are taking the necessary steps to strengthen our financial stability as we pursue our growth strategies,” Michael Kaminski, president and CEO of Stereotaxis, said in a statement.
St. Louis-based Stereotaxis Inc. (NASDAQ: STXS) reported a loss of $32 million on revenue of $42 million last year.
