San Diego, California-based Obalon said it has retired the remaining $5 million of its long-term debt facility with Pacific Western Bank.
The company also said in an 8-K filing with the SEC that it believes it has regained compliance with the Nasdaq Listing Rule regarding shareholder equity, by increasing it above the minimum required for continued listing.
Why It's Important
Obalon said the retirement of debt has served to remove the risks and restrictions of carrying long-term debt.
Additionally, the debt payoff removes an interest burden to the tune of $350,000 annually, the company said.
"We are pleased to continue to transform the company's financial position and believe that with no long-term debt and our current cash position, we are well-positioned to drive our strategy to bring the Obalon Balloon System to patients in need of a proven weight loss solution," CFO William Plovanic said in a statement.
"We remain focused on converting consumer interest in our novel FDA-approved balloon system into patient treatments and successful weight loss experiences, and we are looking forward to the first patient treatments at our company-owned and managed Obalon Center for Weight Loss."
Obalon shares, which dropped below the psychological resistance point of $2 on Monday, were trading 9.5% higher to $1.96 at the time of publication.
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