Company announcement, Helsinki, 13 September 2019 at 3.00 pm (EEST)
Nexstim Plc (NXTMH:HEX, NXTMS:STO) ("Nexstim" or "Company") – the company developing and marketing a unique brain stimulation technology for personalized treatment of major depressive disorder (MDD), announces that it has agreed on a new loan payment schedule with Kreos Capital V (UK) Limited ("Kreos"). According to the agreement approved today, Nexstim will pay Kreos two additional voluntary capital repayments of EUR 600 thousand, the first repayment in September 2019 and the second in November 2019.
Nexstim and Kreos have agreed to these early repayments in order to better balance Nexstim’s debt to equity ratio and reach a below EUR 2 million loan capital balance before the end of year 2019. The voluntary repayments deduct the monthly instalments payable under the previous payment schedule to Kreos proportionately and the loan maturity remains the same ending December 2021. Other terms of the Kreos loan remain the same as agreed i.e. the outstanding loan carrying an interest at the rate of 10.75% per annum and no amendments have been agreed to the terms of warrants granted to Kreos.
The Company estimates that the current working capital would end during Q1 2020. This estimate is based on a conservative revenue forecast and expense estimate and considering the current cash at bank of the Company. This estimate also assumes that the Company will be able to comply with the agreed new terms of its loan agreement entered into with Kreos and no event of default or material adverse change does not occur which would entitle Kreos to prematurely call back its loan. Should the Company fail to comply with the agreed terms and such default or change occurs, and Kreos calls back its loan in full, with outstanding interests and fees, the Company estimates that the current working capital would then run out during November 2019.
Martin Jamieson, Chairman and CEO of Nexstim, commented: “These repayments now agreed with Kreos are part of our long-term funding strategy. The lower monthly payments result in a healthier cash burn rate when going forward. We are continuing to evaluate a number of different funding options and strategic alternatives for our businesses. A key potential source of funding during October-November 2019 is expected to be the proceedings of the exercise of the warrants that were issued as part of the April 2019 share issue.”
Aris Constantinides, General Partner of Kreos Capital commented: "We continue to be supporting Nexstim in the commercialisation of the NBT® system for MDD which is currently Nexstim’s key strategic focus.”
Further information is available on the website www.nexstim.com, or by contacting:
Martin Jamieson, Chairman and CEO
+44 771 516 3942
Sisu Partners Oy (Certified Adviser)
+ 358 40 842 4479
About Nexstim Plc
Nexstim is a Finnish, globally operating medical technology company. Our mission is to enable personalized and effective therapies and diagnostics for challenging brain diseases and disorders.
Nexstim has developed a world-leading non-invasive brain stimulation technology called SmartFocus®. It is a navigated transcranial magnetic stimulation (nTMS) technology with highly sophisticated 3D navigation providing accurate and personalized targeting of the TMS to the specific area of the brain.
SmartFocus® technology is used in Nexstim’s proprietary Navigated Brain Therapy (NBT®) system, which is FDA cleared for marketing and commercial distribution for the treatment of major depressive disorder (MDD) in the United States. In Europe, the NBT® system is CE marked for the treatment of major depression and chronic neuropathic pain.
In addition, Nexstim is commercializing its SmartFocus® based Navigated Brain Stimulation (NBS) system for diagnostic applications. The NBS system is the only FDA cleared and CE marked navigated TMS system for pre-surgical mapping of the speech and motor cortices of the brain. Nexstim shares are listed on the Nasdaq First North Growth Market Finland and Nasdaq First North Growth Market Sweden.