InfoLogix Announces Closing Of Restructuring Of Its Outstanding Debt With Hercules; Believes Compliant With NASDAQ's Minimum Stockholders' Equity Threshold

HATBORO, Pa. Nov. 20 /PRNewswire-FirstCall/ -- InfoLogix, Inc. (Nasdaq: IFLG), a leading technology provider of enterprise mobility solutions for the healthcare and commercial industries, today announced that the Company, including its subsidiaries, have completed a restructuring transaction with its senior lender, Hercules Technology Growth Capital, Inc. ("Hercules"), pursuant to which a portion of the Company's outstanding debt with Hercules Technology I, LLC, a wholly-owned subsidiary of Hercules ("HTI"), 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 HTI, and certain other debt and earnout obligations with other parties were restructured.  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, HTI exchanged $5 million in existing indebtedness for 67,294,751 shares of the Company's common stock.  Additionally, the Company issued to HTI at closing a warrant to purchase 16,823,688 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.  Any advances under the revolving credit facility bear interest initially at 12.0% per annum until the term loans, as described below, are repaid in full, when the interest rate on outstanding advances will be prime plus 4%.  Borrowings under the revolving credit facility are based on eligible accounts receivables, including an overadvance provision of up to $500,000, which will be due 28 days after the overadvance is drawn.  Overadvances bear interest at 15% per annum.

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