HORSHAM, PA — In a strategic move designed to align with its current and future business projections, STRATA Skin Sciences, Inc. (NASDAQ: SSKN) has successfully amended its credit and security agreement with MidCap Financial Trust. The amendment, effective from February 20, 2024, brings about significant changes that will pave the way for the company to execute its strategic initiatives effectively.
This modification, known as Amendment No. 4, eliminates the minimum revenue requirements for 2023 and introduces future financial covenants, thus providing the necessary flexibility for STRATA to manage its operational and capital needs.
Dolev Rafaeli, Vice Chairman and CEO of STRATA, expressed his appreciation for the support provided by MidCap Financial Trust and other lenders. “This amendment underscores the strength of our partnership with MidCap and our lenders,” he said. “Their support is instrumental in advancing our mission to deliver innovative dermatological solutions. We are confident that these revised terms will provide us with the flexibility we need to drive long-term value for our stakeholders.”
As a medical technology company, STRATA specializes in developing, commercializing, and marketing cutting-edge products for in-office treatment of various dermatologic conditions such as psoriasis, vitiligo, and acne. Its product lineup includes the XTRAC® excimer laser, VTRAC® lamp systems, and the TheraClear®X Acne Therapy System.
The company’s unique Partnership Program allows it to offer these innovative technologies in the U.S. This program includes a fee-per-treatment cost structure instead of an equipment purchase, installation and use of the device, on-site training for practice personnel, service and maintenance of the equipment, dedicated account and customer service associates, and co-op advertising support to promote the program within the practice.
MidCap Financial Trust, the other party in the amended agreement, is a middle-market focused, specialty finance firm that provides senior debt solutions to companies across all industries. As of December 31, 2023, MidCap Financial provides administrative or other services for over $50 billion of commitments. Managed by Apollo Capital Management, L.P., MidCap is part of a larger network with assets under management of approximately $651 billion as of the end of 2023.
The amendment is expected to have far-reaching effects on STRATA’s operations and growth strategy. By removing the minimum revenue requirements and introducing future financial covenants, the amendment provides STRATA with the financial flexibility it needs to pursue its strategic initiatives and continue delivering innovative dermatological solutions. The company has filed a copy of the amendment on Form 8k on February 21, 2024.
As the medical technology industry continues to evolve, companies like STRATA Skin Sciences are making strategic moves to stay ahead of the curve. This amendment is a testament to STRATA’s proactive approach to financial management and its commitment to creating long-term value for its stakeholders.
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