Business
Inseego Continues Debt Reduction and Capital Structure Improvements
Company pays-down $9.5 million, or 49%, of short-term loan to further reduce debt and improve Balance Sheet; Company also signs agreement to exchange
About this update from Inseego Corp.
[{"type":"text","content":"\nCompany pays-down $9.5 million, or 49%, of short-term loan to further reduce debt and improve Balance Sheet; Company also signs agreement to exchange additional $5 million of Convertible Notes into long-term debt and equity\n\n SAN DIEGO--(BUSINESS WIRE)--\nInseego Corp. (Nasdaq: INSG) (the “Company” or “Inseego”), a technology leader in 5G mobile and fixed wireless solutions for mobile network operators, Fortune 500 enterprises, and SMBs, is continuing to improve its capital structure and reduce its total debt. Today, Inseego announced that it has (i) voluntarily paid-down an aggregate of $9.5 million, or approximately 49%, of the Company’s outstanding short-term loan, and (ii) entered into a binding agreement (the “Exchange Term Sheet”) with another holder of $5 million in principal amount of the Company’s outstanding 3.25% convertible notes due 2025 (the “2025 Convertible Notes”) to exchange the 2025 Convertible Notes into long-term debt and equity.\n\n“We’re executing on our commitment to reduce our total debt and improve our capital structure,” said Inseego Chief Financial Officer, Steven Gatoff. “The business is generating strong cash flow and with the improved liquidity, we’re glad to be able to pay down total debt. The Company continues to engage with convertible bondholders and right-size the capital structure through these exchanges.”\n\nThe Company has also voluntarily prepaid, at no premium, an aggregate of $9.5 million to-date of the Company’s obligations under the Loan and Security Agreement, dated June 28, 2024 (the “Loan Agreement”), among the Company, South Ocean Funding, LLC (“South Ocean,” an affiliate of Tavistock Group), certain participant lenders (the “Participating Lenders”) and certain subsidiaries of the Company. As a result of these repayments, the amount outstanding under the Loan Agreement has been reduced to $10 million.\n\nPursuant to the Exchange Term Sheet, the convertible note holder agreed to exchange its 2025 Convertible Notes for (i) $4.25 million in principal amount of new long-term senior secured notes (the “New Notes”), and (ii) warrants (the “Exchange Warrants”) to purchase an aggregate of 370,000 shares of the Company’s common stock.\n\nThe New Notes and the Exchange Warrants to be issued pursuant to the Exchange Term Sheet will be the same as the new long-term senior secured notes and...