Hansen Medical, Inc. closed a $33 million, long-term debt agreement with White Oak Global Advisors. The amended and restated senior secured loan agreement includes terms more favorable to Hansen Medical compared to the initial agreement disclosed on July 10, 2013, including the exclusion of intellectual property from the loan's collateral, a reduction of the up-front facility fee, and reductions of prepayment fees in the event of an early repayment of the loan. The new facility will require quarterly interest-only payments through December 30, 2017, at which time the company will also pay the principal balance.
This agreement provides Hansen Medical with a net liquidity enhancement of approximately $25 million over the next 28 months compared to the previous debt facility which required monthly principal payments beginning earlier this month. The proceeds from this new facility were used to retire the company's previous $30 million debt facility, and related fees on August 23rd.
"We are pleased to have closed this long-term, interest-only credit facility through December 30, 2017, providing us with a significant liquidity enhancement over the next 28 months," said Peter J. Mariani, Hansen Medical's Chief Financial Officer. "This new facility, together with the recently announced private placement of equity securities that could generate up to $93 million of gross proceeds over the next two years, provide the company with a foundation of long-term capital to continue to execute the commercial launch of our Magellan™ Robotic System, drive further adoption of our Sensei X Robotic System and strengthen operations across the company."
The new debt facility requires quarterly cash interest payments based on an annual interest rate of 11.0%, plus additional interest of 3.0% per annum which will accrue to the loan balance quarterly and become payable, along with all principal, at the end of the loan term on December 30, 2017. The agreement is a senior secured facility, and maintains a similar covenant structure as the previous debt agreement. No warrants were issued as part of the new debt facility. Further information with respect to the new debt facility is contained in a Current Report on Form 8-K to be filed today by Hansen Medical with the Securities and Exchange Commission.
The DiBari Group acted as debt advisor to Hansen Medical for the new debt agreement.
Hansen Medical, Inc., based in Mountain View, California, is a global leader in intravascular robotics, developing products and technology designed to enable the accurate positioning, manipulation and control of catheters and catheter-based technologies.