Quantum signs debt restructuring deal with Dialectic

Quantum Corporation (NASDAQ: QMCO) entered into a definitive agreement to restructure approximately $52 million in term debt held by Dialectic Technology SPV LLC and other lenders, the San Jose-based data management company announced.

Under the agreement, Dialectic's term debt can be exchanged for senior secured convertible notes with a three-year maturity. The transaction removes the requirement that capital raised through Quantum's Standby Equity Purchase Agreement be used to repay existing term loans, allowing the company to retain up to $15 million in proceeds for working capital and general corporate purposes.

The restructuring eliminates existing leverage and minimum liquidity covenants from Quantum's credit agreement. As consideration for the transaction, Quantum issued Dialectic a warrant to purchase 2,653,308 shares of common stock.

"This transaction to restructure a substantial portion of the Company's outstanding term debt represents a significant step toward our goal of becoming debt-free," stated Hugues Meyrath, Quantum's CEO.

John Fichthorn, Managing Partner of Dialectic Capital Management, called the transaction "an important milestone in Quantum's ongoing operational and financial transformation."

The closing of certain transactions contemplated by the agreement requires approval from Quantum's stockholders, among other conditions. The company plans to file a proxy statement with the SEC regarding the stockholder vote.

Quantum provides data management solutions for AI applications and unstructured data storage systems.

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