The Company completed a series of recapitalization transactions on September 30, 2025 that raised $6.8 million in new capital and eliminated $18.8 million of its debt. The Company is now essentially debt free and is now equipped with capital to execute on its growth strategy. The financing was led by certain accredited investors, with Company Management and members of the Board participating in the financing. The recapitalization provides substantial operational flexibility for management to execute on its strategic plan.
Since the Board selected Terry Mendez as its Chief Executive Officer in February 2025 to lead Safe Harbor's transformation, the Company has been focused on regaining Nasdaq listing compliance, addressing the Company's liquidity challenges, and positioning the Company for long-term strategic success. The Board of Directors and Executive Management have been restructured with a new strategic vision, more than $3 million in annualized run rate costs have been eliminated, and management has now secured the Company's ability to maintain its Nasdaq listing while significantly improving its liquidity position and capital structure.
The transactions are detailed in the Company's 8-K filings with the Securities and Exchange Commission on September 23, 2025 and October 3, 2025. These filings announced that the Company closed an approximately $24.8 million securities purchase agreement for convertible preferred stock and warrants to purchase common stock (the "Series B securities") with certain accredited investors, members of management and Board, and certain vendors. These transactions include the conversion of more than $18.8 million in debt into the Series B securities. Prior to this transaction, the Company's Senior Secured Notes of $10.7 million required interest only payments through January 5, 2027, then principal and interest through October 5, 2030, and a balloon payment of $7.7 million on October 5, 2030. Further, the Company's obligation under ...
