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DIH Holding US, Inc. (DIH), a Delaware-incorporated medical device company with a current market capitalization of $10.19 million and annual revenue of $69.57 million, has entered into an Amendment Agreement with an investor as of May 29, 2025, to exchange a portion of its outstanding convertible debenture for common stock shares. According to InvestingPro analysis, the company is currently trading below its Fair Value, presenting a potential opportunity for value investors despite recent market challenges. The amendment allows for future redemption payments to be made in cash or stock, as well as interest payments on the debenture.
The original Securities Purchase Agreement (SPA), signed on June 7, 2024, involved the private placement sale of a $3,300,000 principal amount of 8% Senior Secured Convertible Debentures to the investor. These debentures were convertible into DIH’s Class A common stock at a conversion price of $5.00 per share, significantly above the current trading price of $0.25. InvestingPro data reveals that the company’s current ratio of 0.51 indicates potential liquidity challenges, which may have influenced this restructuring decision. As of May 1, 2025, the registration statement on Form S-1 did not have sufficient shares available to cover future payments due in conversion shares.
Under the Amendment Agreement, the redemption payment due on May 1, 2025, will be exchanged for 1,540,277 shares of Common Stock, with the June payment to be determined in shares as of June 2, 2025. These shares are referred to as "PIK Payment Shares." The agreement also permits interest on the debenture to be paid in cash or conversion shares, with the investor waiving any defaults resulting from payment delays.
The issuance of the PIK Payment Shares is in accordance with Section 3(a)(9) of the Securities Act, and as such, they may not be offered or sold in the United States without registration or an applicable exemption from registration requirements.
This transaction is part of DIH’s broader financial strategy, and the company has filed the Amendment Agreement as Exhibit 10.1 to its Current Report. The company’s Class A common stock and warrants are listed on the Nasdaq Stock Market LLC under the symbols "DHAI" and "DHAIW," respectively. While the stock has faced significant headwinds with an 84% decline over the past year, InvestingPro has identified multiple additional investment signals that subscribers can access, including detailed financial health scores and growth potential indicators. The information is based on a press release statement.
In other recent news, DIH Holding US, Inc. has been notified by Nasdaq of non-compliance with the exchange’s minimum Market Value of Publicly Held Shares (MVPHS) requirement, risking its listing status. The company has until October 1, 2025, to regain compliance by maintaining an MVPHS of at least $15 million for ten consecutive business days. Additionally, DIH Holding faces another compliance issue with Nasdaq’s Minimum Value of Listed Securities (MVLS) requirement, which mandates maintaining an MVLS above $50 million by September 1, 2025. Failure to meet these requirements could lead to delisting, although the company has the right to appeal. In another development, Dr. Patrick Bruno has resigned from DIH Holding’s Board of Directors and executive roles, effective February 25, 2025. The company will not seek an immediate replacement for Dr. Bruno, opting to reduce the board size to five members. His departure was formalized through a Termination Agreement, which includes confidentiality and non-disparagement clauses. These developments have been disclosed through press releases and SEC filings, with the company exploring options to address its compliance challenges.
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