ProSomnus Sleep Technologies secured definitive agreements for $30 million in convertible notes with institutional investors led by Cohanzick Management and CrossingBridge Advisors. As first reported by DealFlow earlier this month, the financing will support the proposed merger of ProSomnus and Lakeshore Acquisition I.
The closing of the convertible notes financing is conditioned upon the closing of the business combination prior to Dec. 10. The notes will be issued by the combined company. If the deal is approved, ProSomnus class A common stock is expected to trade on the Nasdaq under the symbol OSA.
The debt issue consists of two tranches: $15 million of senior secured convertible notes and $15 million of junior secured convertible notes with maturities of 36 months and 40 months.
Announced in May, the deal would give the combined enterprise an implied initial enterprise value of $168 million.
The parties initially said they expected to close the deal in the third quarter, although the SPAC has sought a deadline extension into December.
Terms call for Lakeshore to acquire ProSomnus for $125 million (including the assumption of $13 million of debt to be paid off at closing). Lakeshore will issue approximately 11 million new shares to current ProSomnus stockholders (subject to net debt outstanding at closing). Read more.
