Non-dilutive debt capital at market favorable terms strengthens the balance sheet and provides additional working capital to fund key clinical and commercial initiatives
CytoSorbents Corporation, a leader in the treatment of life-threatening conditions in the intensive care unit and cardiac surgery using blood purification via its proprietary polymer adsorption technology, announced that it has received $5 million in non-dilutive debt financing under the terms of the Fourth Amendment to its Amended and Restated Loan and Security Agreement with Bridge Bank, which provided for a term loan commitment of up to $15 million in aggregate, available for drawdown in tranches of $5 million each at the discretion of CytoSorbents and subject to certain financial requirements. Separately, on December 29, 2022, the two parties entered into the Fifth Amendment to the Amended and Restated Loan and Security Agreement, extending the drawdown period on the remaining $10 million loan commitment from December 31, 2022 to March 1, 2023, subject to certain requirements.
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The initial $5 million tranche of the term loan has no associated financial or other covenants and bears interest at the Index Rate (defined in the Loan Agreement as the greater of 3.25% or the Prime Rate as published by the Wall Street Journal on the last business date of the month immediately preceding the month in which the interest will accrue) plus 1.25%, subject to an interest rate cap of 8.00%. Subject to certain financial requirements, interest-only payments are due until January 1, 2024, followed by equal monthly payments of principal and interest until the maturity of the loan on December 1, 2025.
Non-dilutive debt at market favorable terms strengthens balance sheet & helps fund key clinical & commercial initiatives
Kathleen P. Bloch, CPA, MBA, Chief Financial Officer of CytoSorbents, stated, “We believe that debt capital represents an attractive alternative to equity at the current time and that this non-dilutive financing strengthens our balance sheet at favorable terms, providing us with additional capital that we anticipate using for three of our major goals as we enter 2023. The first is to successfully complete our U.S. STAR-T pivotal trial and to file for potential U.S. FDA and Health Canada marketing approvals for DrugSorb-ATR™ in the second half of 2023. The second is to support a number of important commercial initiatives and to steer our Company back to product sales growth. The third goal is to ensure tight control of expenses designed to make our cash go farther. Bridge Bank has been an excellent partner for more than six years and we greatly appreciate their continuing confidence and support of our business.”
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Bill Wickline, Head of Life Sciences at Bridge Bank, stated, “Over the years of working with CytoSorbents, we have witnessed the significant revenue growth of the Company and the validation of its scalable, high margin business model. We are pleased to contribute to the capital needs of CytoSorbents at this next stage of their evolution and to support their important mission of working to save lives worldwide.”
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