Bridge Loan From Existing Investors and a New Institutional Investor Secured by the Company’s Patent Portfolio Preliminarily Valued to be in the Range of $100 Million
NUBURU, Inc. (“NUBURU” or the “Company”) (NYSE:BURU), a leading innovator in high-power and high-brightness industrial blue laser technology, today announced it has entered into a secured bridge loan agreement (the “Bridge Loan” or “Bridge Financing”) with existing investors and a new institutional investor. The Bridge Financing with a principal amount of $5.5 million is intended to finance the Company until it secures long-term credit financing, which is anticipated in the near term.
Brian Knaley, CEO of NUBURU, commented: “I want to thank our existing and newly participating investors for their trust and commitment. We all share the enthusiasm for NUBURU’s groundbreaking technology and strong patent portfolio. The Bridge Financing is an important step on our way to a longer-term credit facility intended to support the commercialization of our blue lasers.”
The Bridge Loan consists of zero-interest promissory notes issued with a 10% original issue discount, which will mature when we close the anticipated credit facility (or twelve months after issuance at the latest) (the “Notes”). The Notes are secured by NUBURU’s patent portfolio, which was independently and preliminarily valued to be in the range of $100 million. Following acceptance by the NYSE of the Company’s supplemental listing application, the Company will also issue to the holders of Notes warrants exercisable for common stock equal to 100% of the Note principal, which will be exercisable for $0.25 per share, have a 5-year term, and may be repurchased by the Company when the trading price exceeds $1.50 for 20 out of 30 trading days. If the Notes have not been repaid within six or nine months after issuance, the Notes will begin to bear interest (at the SOFR rate plus 9% and at the SOFR rate plus 12%, respectively) and additional 25% warrant coverage will be provided at each such date. Pursuant to a registration rights agreement among the Company and the holders of warrants, the Company intends to register the common stock underlying the warrants no later than February 1, 2024.
The parties to the Bridge Financing also entered into an intercreditor and subordination agreement with the holders of senior secured convertible notes, whose convertible notes will now be secured and rank senior in priority to the Notes.
Northland Capital Markets acted as sole placement agent on the institutional investor portion of the Bridge Financing.
