(RTTNews) -  InfoLogix, Inc. (IFLG: News ) said on Friday that it and subsidiaries have completed a restructuring transaction with its senior lender, Hercules Technology Growth Capital, Inc., pursuant to which a portion of the company's outstanding debt with Hercules Technology I, LLC was converted into equity in the company, the remaining outstanding debt with Hercules was otherwise restructured, the company issued warrants to purchase equity in the company to Hercules Technology I, and certain other debt and earnout obligations with other parties were restructured.

The company said that the restructuring resulted in the cancellation of $5 million in indebtedness and provides for up to $5 million in additional availability under a revolving credit facility with Hercules.

Under the terms of the restructuring, Hercules Technology I exchanged $5 million in existing indebtedness for 67.29 million shares of the company's common stock. Additionally, the company issued to Hercules Technology I at closing a warrant to purchase 16.82 million shares of the company's common stock at an exercise price of $0.0743 per share.

The warrant has a five year term and is immediately exercisable at such time when the company amends its certificate of incorporation to increase the number of authorized shares of common stock or implements a reverse stock split that results in the company having a sufficient amount of authorized shares to issue the warrant shares. The company has agreed to register these shares with the Securities and Exchange Commission for resale.
The remainder of the company's indebtedness with Hercules was restructured to include two term loans aggregating $10.5 million and a revolving credit facility of $12 million, of which $7 million is outstanding at closing. The revolving credit facility expires on May 1, 2011, but may be extended at the company's option for six months if there is no existing event of default.

Based upon the consummation of the restructuring, the company believes that it has regained compliance with the $2.5 million stockholders' equity requirement for continued listing on The Nasdaq Capital Market. The company is awaiting Nasdaq's formal determination with respect to its compliance status.

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by RTT Staff Writer

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