Ribbon Announces $55 Million Preferred Stock Private Placement Financing and Amendment to Credit Facility

About this update from Ribbon Communications Inc.

[{"type":"text","content":"PLANO, Texas, March 24, 2023 /PRNewswire/ -- Ribbon Communications Inc. (\"Ribbon\") (Nasdaq: RBBN) today announced that it has priced a private placement financing of Series A preferred stock and warrants to purchase shares of common stock to raise gross proceeds of approximately $53.4 million.\n\n \n \n \n \n \n \n\n \nRibbon also announced that it has entered into an amendment to its senior secured credit agreement. The amendment, among other things, reduces the minimum consolidated fixed charge coverage ratio and increases the maximum consolidated net leverage ratio that Ribbon must comply with on a quarterly basis with the quarter ended March 31, 2023 through March 31, 2024. In addition, the amendment replaces LIBOR with the Secured Overnight Financing Rate, or SOFR, as the alternative rate that may be used by Ribbon for calculating interest owed under the credit facility. \nIn connection with the amendment to the credit facility, Ribbon has agreed to a prepayment of $75 million of the principal amount outstanding on the Term Loan A under the credit facility and Ribbon intends to use the net proceeds from the private placement, together with cash on hand, to pay down borrowings under the credit facility.\nRibbon expects to issue 55,000 shares of Series A preferred stock, along with warrants to purchase shares of common stock, in the private placement. Each share of Series A preferred stock will be sold at a price of $970 per share. The warrants will be immediately exercisable and will expire four years from the date of issuance. The warrant exercise price per share will be equal to 115% of the lower of (i) the closing price of the common stock on March 24, 2023 and (ii) the two-day VWAP (as defined in the securities purchase agreement relating to the private placement) of March 27, 2023 and March 28, 2023. The private placement is expected to close on or about March 30, 2023, subject to customary closing conditions.\nThe securities are being offered in a private placement under Section 4(a)(2) of the Securities Act of 1933, as amended (\"Securities Act\"), and have not been registered under the Securities Act, or applicable state securities laws. Accordingly, the securities may not be offered or sold in the United States except pursuant to an effective registration statement or an applicable exemption from the registration ...

More updates from Ribbon Communications Inc.