Business
RYVYL Bolsters Capital Structure Resulting in Debt Reduction, Significant Improvement to Cash Flow, and Increased Shareholder Equity in Exchange Agreement with Convertible Noteholder
$6 Million Initial Debt Reduction Additional $16.7 million upon Exchanges of Convertible Note into Preferred Stock $5 Million Second Half 2023 Cash Flow
About this update from Rtb Digital, Inc.
[{"type":"text","content":"$6 Million Initial Debt Reduction Additional $16.7 million upon Exchanges of Convertible Note into Preferred Stock $5 Million Second Half 2023 Cash Flow Improvement with Interest Write-off SAN DIEGO, CA, July 26, 2023 (GLOBE NEWSWIRE) -- RYVYL Inc. (NASDAQ: RVYL) (\"RYVYL\" or the \"Company\"), a company that leverages the security of the blockchain and USD-pegged stablecoin technology with near-real-time attestation capabilities to conduct payment transactions, has agreed to an amendment of terms with the noteholder of the $100 million convertible note financing, originally entered into on November 5, 2021. Under the terms of an Exchange Agreement, in two separate exchanges, an aggregate of $22.703 million of the existing note will potentially be exchanged into 15,000 shares of a new class of RYVYL convertible preferred stock, with an aggregate stated value of $15,000,000. We expect $6 million of the existing note (including $1,703,000 of interest) will be exchanged into 6,000 shares of preferred stock in the initial exchange that we anticipate will occur on or prior to July 27, 2023 with the remaining $16,703,000 in principal to be exchanged into 9,000 shares of preferred stock at an additional closing, subject to the Company’s having obtained stockholder approval for the issuance of all shares of common stock underlying the preferred stock in accordance with the rules and regulations of NASDAQ. After the consummation of the exchanges, the Company’s total debt will effectively be reduced by $22.703 million, improving shareholder equity by a similar amount and the stated value of the new preferred stock issued in the exchange shall be approximately $7.7 million less than the aggregate amount of the existing note surrendered in the exchanges. Under the terms of the separate Leak-Out Agreement with the noteholder, there are also certain limitations on the noteholder’s sales of RVYL stock in the open market. Chairman Ben Errez commented: “This a major win for all RYVYL stakeholders once again demonstrating the strength of the relationship with our noteholder as well as its belief in RYVYL’s mission and the proposed Coyni spin-off. We believe that the exchange should significantly bolster and revitalize our capital structure with the added benefit of mitigating NASDAQ compliance deficiencies risk on both bid price compliance and fu...