Blue laser enterprise NUBURU obtains $5.5 million bridge financing

Recently, NUBURU, a supplier of high-power and high brightness industrial blue laser technology in the United States, announced that it has reached bridge loan agreements ("bridge loans" or "bridge financing") with existing and new institutional investors.

The principal of this bridge financing is $5.5 million, aimed at providing funding for the company until it obtains long-term credit financing, which is expected to be obtained in the short term.

At the beginning of this month, NUBURU announced its financial results for the third quarter ended September 30, 2023. The financial report shows that the total revenue for the quarter was $200000, a decrease of 78% from the previous quarter's $900000, mainly due to a decrease in the number of laser system sales. In addition, the operating loss is slightly higher than $5 million, and there is only $1.6 million in cash on the balance sheet.

Faced with such a situation, it is clearly necessary to quickly raise funds to "revive". SEC documents show that when the company went public in January, it only raised $3 million, despite receiving an additional $9 million from loan notes in June.

Regarding the newly obtained $5.5 million bridge financing, NUBURU CEO Brian Knaley commented, "I would like to thank our existing and newly participating investors for their trust and commitment. We are all enthusiastic about NUBURU's breakthrough technology and strong patent portfolio. Bridge financing is an important step towards our long-term credit arrangement, aimed at supporting the commercialization of our blue laser.

The transitional loan includes a zero interest promissory note issued at a 10% discount on the original issuance, which will expire at NUBURU's expected credit limit (or at the latest 12 months after issuance) (the "Note"). These bills are guaranteed by NUBURU's patent portfolio, which is independent and initially valued within the range of $100 million.

After accepting the company's supplementary listing application on the New York Stock Exchange, the company will also issue ordinary equity certificates equivalent to 100% of the principal of the notes to holders of note warrants. These warrants will be exercised at a price of $0.25 per share for a period of 5 years. When the trading price exceeds $1.50 on 20 out of 30 trading days, the company can repurchase them. If the notes are not repaid within 6 or 9 months after issuance, interest will begin to accrue on the notes (calculated at SOFR rate plus 9% and SOFR rate plus 12% respectively), and an additional 25% warrant coverage will be provided on each such date. According to the registration rights agreement between the company and the warrant holder, the company intends to register the ordinary shares related to the warrant no later than February 1, 2024.

The parties involved in the bridge financing have also signed intercreditor and subordination agreements with the holders of priority secured convertible notes, which will now be secured and have priority over the notes.

In addition to new financing support, fortunately, NUBURU has also secured a purchase order from a multinational electronics manufacturer with top-notch manufacturing capabilities in Asia, Latin America, Europe, and the United States, providing BL-250 for the manufacturing of next-generation computers, consumer electronics, and communication (3C) equipment, demonstrating the integration of NUBURU's laser welding capabilities.

In addition, NUBURU announced that it has completed the contract awarded by the US Air Force and, with the support of GE Additive, successfully demonstrated area printing based on blue laser to develop a scalable 3D printing manufacturing system.
Next, the company will prioritize further strengthening its distribution network and continuously implement its long-term growth strategy.

NUBURU CEO Brian Knaley commented on current performance, saying, "Our third quarter performance reflects supply chain constraints, which is basically consistent with our expectations for entering the second half of 2023. However, in the third quarter, we faced additional resistance in integrating our systems into customer applications, resulting in delays in our product shipments. I believe that the solution we developed not only enhances our BL-250 product supply, but also simplifies the manufacturing process to improve the application and integration of our technology in their respective end markets. Due to the expected delivery volume of laser systems in the fourth quarter of 2023 There will be a rebound, and we have adjusted our outlook for the entire year of 2023 accordingly, eagerly anticipating the positive impact of our technological improvements.

Source: OFweek