This strategic move comes after the Nasdaq Stock Market LLC delisted Acutus Medical (TASE:PMCN)'s common stock on May 26, 2024, with the common stock currently trading on the OTC Pink Market under the symbol "AFIB." The stock has experienced significant volatility, with an 84% gain over the past six months despite a sharp 19% decline in the past week.
InvestingPro analysis suggests the stock is currently undervalued, though investors should note the company's challenging financial position and uncertain future. The stock has experienced significant volatility, with an 84% gain over the past six months despite a sharp 19% decline in the past week. InvestingPro analysis suggests the stock is currently undervalued, though investors should note the company's challenging financial position and uncertain future.
The Carlsbad, California-based medical device company, which specializes in surgical and medical instruments, has amended its existing credit agreement and established several new arrangements. The amendment, known as Amendment No. 5, allows Acutus Medical to deregister its common stock and cease its periodic reporting obligations under the Securities Exchange Act of 1934.
This process, often referred to as "going dark," is expected to reduce the company's operational costs significantly. With a market capitalization of just $1.95 million and a concerning financial health score of 2.37 out of 5 on InvestingPro, this move appears aligned with the company's need to conserve resources.
As part of the amendment, Deerfield Funds will receive a contingent value right, essentially a consent fee, payable upon specific triggering events, capped at $300,000 or 5% of the total value available to Acutus Medical’s equity holders. The amendment also stipulates the appointment of a Chief Restructuring Officer and requires the company to maintain a minimum liquidity of $5 million.
Associated with the credit agreement amendment, Acutus Medical has entered into a contingent value rights agreement, a warrant termination agreement, and a registration rights termination agreement. The warrant termination agreement results in the termination of warrants to purchase shares of Acutus Medical’s common stock for a fee of $250,000 paid to Deerfield Funds.
The Board of Directors of Acutus Medical has determined that deregistering the company's common stock is in the best interests of the company and its stakeholders. This decision was influenced by the costs associated with being a public reporting company and the limited trading activity of its common stock.
This strategic move comes after the Nasdaq Stock Market LLC delisted Acutus Medical’s common stock on May 26, 2024, with the common stock currently trading on the OTC Pink Market under the symbol "AFIB."
The information in this article is based on a press release statement and is a factual reporting of the events outlined in the SEC filing by Acutus Medical, Inc.
In other recent news, Acutus Medical has made significant changes to its credit agreement terms and finalized a substantial settlement. The medical device company amended its credit agreement with lenders Deerfield Partners, L.P. and Deerfield Private Design Fund III, L.P. The amendment, which is effective immediately, modifies payment schedules and increases the exit fee.
Acutus Medical rescheduled a $7.5 million principal payment due in 2025 into three equal installments and increased the exit fee for prepayment or repayment of loans from 5.0% to 6.0%.
In addition to the credit agreement amendment, Acutus Medical also settled an ongoing arbitration with Biotronik SE & Co. KG and VascoMed GmbH, collectively known as the BIO Parties. The settlement terminates several key agreements related to the licensing, manufacturing, and distribution of medical devices. As part of the settlement terms, Acutus Medical will make an initial payment of $2.6 million to Biotronik, with contingent payments outlined based on future events.
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