Quantum Enters into Definitive Agreement with Dialectic and Other Lenders to Restructure Term Debt

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[{"type":"text","content":"\nTransaction Represents Key Milestone Toward Eliminating Outstanding Debt\n\n\n SAN JOSE, Calif.--(BUSINESS WIRE)--\nQuantum Corporation (Nasdaq: QMCO) (\"Quantum\" or the \"Company\"), a leader in solutions for AI and unstructured data, today announced it has entered into a definitive agreement (the “Transaction Agreement”) to restructure the Company’s outstanding term debt held by Dialectic Technology SPV LLC (“Dialectic”) and certain other lenders. In addition, Quantum amended its existing term loan credit and security agreement with its current term loan lenders to remove the financial covenants therein.\n\n\nHighlights of Transaction:\n\n\n\nAbility for Dialectic term debt of approximately $52 million to be exchanged for senior secured convertible notes that have a three-year maturity (the “Debt Exchange”)\n\n\n\nEliminates existing requirement that capital raised to date through the Company’s Standby Equity Purchase Agreement (the “SEPA”) be used to repay the existing term loan\n\n\n\nAllows up to an additional $15 million of SEPA proceeds to be retained by the Company for working capital and general corporate purposes\n\n\n\nEliminates existing leverage and minimum liquidity covenants\n\n\n\n\nIssued Dialectic a warrant to purchase 2,653,308 shares of the Company’s common stock as consideration\n\n\n\n“This transaction to restructure a substantial portion of the Company’s outstanding term debt represents a significant step toward our goal of becoming debt-free,” stated Hugues Meyrath, CEO of Quantum. “The proposed exchange of term debt for convertible notes demonstrates Dialectic’s belief in the Company’s strategic vision and long-term growth opportunities, while also aligning Dialectic as a future strategic partner. In addition, we believe this transaction provides increased financial flexibility to execute on our operating initiatives and revitalized go-to-market strategy.”\n\n\nMeyrath continued, “This important milestone in our financial transformation follows the recent rebuilding of our Board of Directors and executive team, including leadership changes throughout the organization. We believe the increased financial flexibility provided by this transaction allows us to focus on our goal of delivering profitable performance and revenue growth.”\n\n\n“This transaction is an important milestone in Quantum’s ongoing op...

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