FOXO Technologies Inc. Secures Up to $2.8 Million in Senior Notes to Fund Previously Announced Acquisition of Myrtle Recovery Centers, Inc. and Provide Additional Working Capital

Rhea-AI Summary

FOXO Technologies has secured up to $2.8 million in Senior Notes from an institutional investor to fund the acquisition of Myrtle Recovery Centers and provide additional working capital. The acquisition, along with the planned purchase of Scott County Community Hospital, is expected to be transformative for the company, which reported combined unaudited net revenue of approximately $18.7 million and net income of $5.2 million for 2023. Interim CEO Mark White expressed optimism about the strategic fit of these acquisitions with FOXO's epigenetic and AI-based solutions. Further details are available in the Company's Form 8-K filed with the SEC.

Positive

• Secured up to $2.8 million in Senior Notes, providing additional working capital.
• Acquisition of Myrtle Recovery Centers expected to be transformative.
• Planned acquisition of Scott County Community Hospital anticipated to be synergistic.
• Combined unaudited net revenue of $18.7 million and net income of $5.2 million (2023) from the acquisitions.
• Institutional investor support validates FOXO's business model.

Negative

• Dependency on institutional investor for funding, indicating possible cash flow issues.
• Potential dilution of shareholder value due to issuance of Senior Notes.
• Pending acquisitions may carry integration risks and financial uncertainty.
• Uncertainty around the 'planned' acquisition of Scott County Community Hospital.

Financial Analyst

FOXO Technologies Inc.'s announcement of securing up to $2.8 million in Senior Notes is significant for several reasons. Firstly, the funding is targeted at completing the acquisition of Myrtle Recovery Centers, Inc. and advancing the acquisition of Scott County Community Hospital, Inc. (d/b/a Big South Fork Medical Center). The implied revenue and income figures—$18.7 million and $5.2 million, respectively—indicate potential for substantial growth in FOXO's revenue streams.

From a financial perspective, this could lead to improved earnings and potentially enhanced shareholder value. The institutional investor's involvement also lends credibility, suggesting due diligence and confidence in FOXO's business model. However, investors should remain cautious of the costs associated with these acquisitions and the ability of FOXO to integrate these businesses effectively, especially given the interim CEO's role. Ensuring smooth transitions and synergies are critical for realizing the projected benefits.

Finally, while the added working capital is a positive indicator of liquidity, it will be important to monitor how FOXO utilizes these funds to drive growth versus covering operational expenses. The market reaction will also depend on how quickly these acquisitions translate into tangible financial improvements.

Healthcare Industry Expert

The acquisitions of Myrtle Recovery Centers, Inc. and Scott County Community Hospital, Inc. are notable within the healthcare sector. Both centers are reportedly generating substantial revenue and profit, which suggests they are well-managed and potentially valuable additions to FOXO's portfolio. The term 'synergistic' often implies that the acquired companies will enhance FOXO's current operations, likely through cost efficiencies, expanded services, or market reach.

Investors should consider the landscape of the healthcare industry, particularly focusing on recovery and community hospital services, which can be both lucrative and competitive. The integration of these businesses with FOXO's epigenetic and AI-based solutions could provide a competitive edge, but execution risks remain high.

To gain deeper insights, investors should track the progress of these acquisitions closely and evaluate any operational updates. The ability to scale and integrate these centers efficiently will be important for FOXO's long-term success in the healthcare market.

MINNEAPOLIS, MN, June 18, 2024 (GLOBE NEWSWIRE) -- FOXO Technologies Inc. (NYSE American: FOXO) (the “Company” or “FOXO”), today announced that it has secured up to $2.8 million in Senior Notes from an institutional investor (“Investor”) to fund the previously announced acquisition of Myrtle Recovery Centers, Inc. as well as provide additional working capital to support the Company’s growth strategy. 

Mark White, Interim CEO of FOXO, said, “We appreciate the support of this institutional investor, which we believe is further validation of our business model. Specifically, we intend to use the proceeds to complete the acquisition of Myrtle Recovery Centers, Inc., as well as advance our planned acquisition of Scott County Community Hospital, Inc. (d/b/a Big South Fork Medical Center). As previously noted, we believe these two acquisitions will be transformative for the Company, given that these businesses generated combined unaudited net revenue of approximately $18.7 million and net income of approximately $5.2 million for the twelve months ended December 31, 2023. We are making progress towards completing the planned acquisitions, which we expect will be highly synergistic with our existing epigenetic and AI-based epigenetic solutions. Overall, we could not be more excited about the outlook for the business and look forward to providing further updates.”

Additional details on the Senior Notes are available in the Company’s Form 8-K, which has been filed with the Securities and Exchange Commission.

About FOXO Technologies Inc.

FOXO is a biotechnology company dedicated to improving human health and longevity through the development of cutting-edge technology and product solutions for various industries, including life insurance. FOXO’s epigenetic technology applies AI to DNA methylation to identify molecular biomarkers of human health and aging. FOXO is committed to leveraging the latest advancements in science and technology to help people live better, longer lives. For more information about FOXO, visit www.foxotechnologies.com.

Forward-Looking Statements

This press release contains certain forward-looking statements for purposes of the “safe harbor” provisions under the United States Private Securities Litigation Reform Act of 1995. Any statements other than statements of historical fact contained herein, including statements about the delisting of the Warrants from NYSE American, trading of the Warrants in the over-the-counter market, the continued listing of the Company’s Class A common stock on NYSE American, and other statements identified by words such as “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimated,” “believe,” “intend,” “plan,” “projection,” “outlook” or words of similar meaning, but the absence of these words does not mean that a statement is not forward-looking. Any such forward-looking statements are based upon the current beliefs and expectations of the Company’s management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond the Company’s control. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to the possibility that the Plan will not be accepted by NYSE American, the Company will be unable to satisfy other continued listing requirements of NYSE American for its Class A common stock to maintain the listing of the Class A common stock on NYSE American; the risk of changes in the competitive and highly regulated industries in which FOXO operates; variations in operating performance across competitors or changes in laws and regulations affecting FOXO’s business; the ability to implement FOXO’s business plans, forecasts, and other expectations; the ability to obtain financing; the risk that FOXO has a history of losses and may not achieve or maintain profitability in the future; potential inability of FOXO to establish or maintain relationships required to advance its goals or to achieve its commercialization and development plans; the enforceability of FOXO’s intellectual property, including its patents and the potential infringement on the intellectual property rights of others; and the risk of downturns and a changing regulatory landscape in the highly competitive biotechnology industry or in the markets or industries in which FOXO operates, including the highly regulated insurance industry. The foregoing list of factors is not exhaustive. Readers should carefully consider the foregoing factors and the other risks and uncertainties discussed in FOXO’s most recent reports on Forms 10-K and 10-Q, particularly the “Risk Factors” sections of those reports, and in other documents FOXO has filed, or will file, with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and FOXO assumes no obligation and do not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise.

Contact:
Crescendo Communications, LLC
(212) 671-1020
foxo@crescendo-ir.com

FAQ

What recent funding did FOXO Technologies secure?

FOXO Technologies secured up to $2.8 million in Senior Notes from an institutional investor.

What is the purpose of FOXO Technologies' recent funding?

The funding will support the acquisition of Myrtle Recovery Centers and provide additional working capital.

What financial performance did Myrtle Recovery Centers and Scott County Community Hospital report for 2023?

The combined unaudited net revenue was approximately $18.7 million, with a net income of $5.2 million.

How does FOXO Technologies plan to use the proceeds from the Senior Notes?

The proceeds will be used to complete acquisitions and support the company's growth strategy.

What acquisitions is FOXO Technologies planning with the new funding?

FOXO plans to acquire Myrtle Recovery Centers and Scott County Community Hospital.