Here are five things to know:
1. Amedica entered into a settlement agreement with MG Partners II — Magna — as part of the transaction.
2. The transaction also amended Amedica’s loan agreement with Hercules Technology Growth Capital. Hercules withdrew its previously issued default notice and agreed to reduce Amedica’s financial cash covenant as the loan is paid, which should provide additional financial flexibility in the future.
3. The settlement agreement with Magna provides for the withdrawal of previously issued default notice and permanent waivers of any contractual rights. This includes convertible features associated with Magna’s convertible debentures.
4. The transaction is expected to execute in three equal traches:
• The first is registered direct offering of 13 million shares of common stocks and Series B warrants for $0.381 per share. The first trache also includes a concurrent private placement of Series A and Series C warrants, each to purchase 13 million shares of common stock. The company expects $5 million in proceeds from the first trache, which is expected to close Sept. 11.
• The second and third traches include the exercise of Series B warrants and Series C warrants for an additional $10 million.
5. In the first trache, the exercise of both Series B and Series C warrants may occur automatically under certain conditions and is subject to shareholder approval. The number of shares issuable may increase under certain circumstances.
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