ProSomnus, Inc. emerged from chapter 11 on August 5, 2024, roughly three months after filing, having confirmed a consensual reorganization that converted debtor-in-possession financing and a prearranged plan into a swift exit. The medical-technology debtor—a Pleasanton, California maker of precision intraoral devices for obstructive sleep apnea with approximately 142 employees across the United States, Canada, and Germany—filed for relief on May 7, 2024 Voluntary PetitionDkt. 1 in the District of Delaware before Judge John T. Dorsey.
The filing was precipitated by a rapid post-de-SPAC deterioration. ProSomnus had become public in December 2022 through a merger with Lakeshore Acquisition I Corp., and the costs of that transition—combined with debt and warrant valuation charges—drove the company from a $7.1 million net loss in 2022 to $24.1 million in 2023, even as revenue rose 43% to $27.7 million first-day declaration of CFO Brian DowDkt. 14. The prepetition capital stack was concentrated in convertible notes secured by substantially all of the debtor's assets: approximately $21.0 million of first-lien Senior Secured Convertible Notes and Exchange Notes due December 2025, and roughly $17.5 million of second-lien subordinated convertible notes due April 2026, aggregating about $38.4 million of funded debt Dow DeclarationDkt. 14.
To bridge to a plan, ProSomnus sought combined DIP financing and cash collateral use on the petition date. The court granted interim authority within days and a final order in early June authorizing a senior subordinate secured postpetition term loan carrying roughly $6.9 million of new money, about $6.0 million of rolled-up prepetition debt, and total commitments near $12.9 million, with priming liens and superpriority administrative claims. That facility carried the debtor through solicitation and confirmation and reached its plan-effective stage on effectiveness.
The plan track moved quickly. ProSomnus filed a joint plan in late May and iterated through amended versions in June, soliciting an amended plan supported by an approved disclosure statement Amended Joint Chapter 11 PlanDkt. 192. The restructuring—built on new notes and new-money equity from sponsoring noteholders and backstop parties across seven classes—drew favorable class votes tabulated in late July and was confirmed by order entered July 30, 2024, with the plan becoming effective on August 5, 2024.
With effectiveness achieved, the debtor moved in late August for entry of a final decree to close the chapter 11 cases. The restructuring is now substantially consummated; remaining activity is limited to administrative wind-down, claims reconciliation, and entry of the final decree.
