On October 19, 2016, Horizon Pharma, Inc. and Horizon Pharma
USA, Inc. (the Issuers), wholly owned subsidiaries of Horizon Pharma plc (the Company), entered into a purchase agreement (the Purchase Agreement) with Merrill Lynch, Pierce, Fenner & Smith Incorporated,
as representative of the several initial purchasers listed in Schedule I thereto (collectively, the Initial Purchasers), relating to the sale by the Issuers of $300 million aggregate principal amount of 8.750% Senior Notes due
2024 in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the Securities Act). The Issuers sale of the notes to the Initial Purchasers is being made
pursuant to Section 4(a)(2) of the Securities Act. The Issuers expect the offering to close on October 25, 2016, subject to the satisfaction of customary closing conditions.
The Company expects to use the net proceeds from the offering of notes as well as $375.0 million principal amount of incremental term loans
under its existing senior secured credit facility (the agreement governing such facility, the Credit Agreement) to fund a portion of its planned acquisition of Raptor Pharmaceutical Corp. (Raptor, and the planned acquisition
of Raptor, the Raptor Acquisition), repay Raptors outstanding debt, and pay any prepayment premiums, fees and expenses in connection with the foregoing.
If the Raptor Acquisition is not consummated concurrently with the consummation of the offering of notes, the Issuers would enter into an
escrow agreement pursuant to which the Issuers would deposit into an escrow account the gross proceeds from the offering of notes, plus an amount of cash that, when taken together with the gross proceeds from the offering of notes, would be
sufficient to fund a special mandatory redemption of the notes on the third business day after January 9, 2017, if such special mandatory redemption were to occur on such date. The release of the funds in the escrow account to the Issuers would
be subject to the satisfaction of certain conditions, including the satisfaction or waiver of all of the conditions precedent to closing the Raptor Acquisition (collectively, the Escrow Release Conditions). If the Raptor Acquisition is
not consummated on or prior to January 9, 2017 or if the Issuers notify the trustee and the escrow agent in writing that the merger agreement pertaining to the Raptor Acquisition has been terminated, the notes would be subject to a special
mandatory redemption. The special mandatory redemption price for the notes would be 100% of the initial issue price plus accrued interest to the date of redemption. If the Escrow Release Conditions are satisfied or waived, the escrowed funds would
be released to the Issuers. If the closing of the Raptor Acquisition occurs substantially concurrently with the consummation of the offering of notes, the Issuers will forgo the escrow procedures described above.
The notes will be the Issuers general unsecured senior obligations, will rank equally in right of payment with all existing and future
senior debt of the Issuers and will rank senior in right of payment to any future subordinated debt of the Issuers. The notes will be effectively subordinate to all of the existing and future secured debt of the Issuers to the extent of the value of
the collateral securing such debt.
The notes will be, jointly and severally, unconditionally guaranteed on a senior basis by the Company
and all of the Companys restricted subsidiaries, other than the Issuers, in each case that guarantee the Credit Agreement. The guarantees will be each guarantors senior unsecured obligations and will rank equally in right of payment with
such guarantors existing and future senior debt and senior in right of payment to any existing and future subordinated debt of such guarantor. The guarantees will be effectively subordinated to all of the existing and future secured debt of
each guarantor, including such guarantors guarantee under the Credit Agreement, to the extent of the value of the collateral securing such debt. The guarantees of a guarantor may be released under certain circumstances. The notes will be
structurally subordinated to all of the liabilities of the Companys subsidiaries that do not guarantee the notes.
The notes will accrue interest at an annual rate of 8.750% payable semiannually in arrears on
May 1 and November 1 of each year, beginning on May 1, 2017. The notes will mature on November 1, 2024, unless earlier exchanged, repurchased or redeemed.
Except as described below, the notes may not be redeemed before November 1, 2019. Thereafter, some or all of the notes may be redeemed at
any time at specified redemption prices, plus accrued and unpaid interest to the redemption date. At any time prior to November 1, 2019, some or all of the notes may be redeemed at a price equal to 100% of the aggregate principal amount
thereof, plus a make-whole premium and accrued and unpaid interest to the redemption date. Also prior to November 1, 2019, up to 35% of the aggregate principal amount of the notes may be redeemed at a redemption price of 108.750% of the
aggregate principal amount thereof, plus accrued and unpaid interest, with the net proceeds of certain equity offerings. In addition, the notes may be redeemed in whole but not in part at a redemption price equal to 100% of the principal amount plus
accrued and unpaid interest and additional amounts, if any, to, but excluding, the redemption date, if on the next date on which any amount would be payable in respect of the notes, the Issuers or any guarantor is or would be required to pay
additional amounts as a result of certain tax related events.
If the Company undergoes a change of control, the Issuers will be required
to make an offer to purchase all of the notes at a price in cash equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest to, but not including, the repurchase date. If the Company or certain of its subsidiaries
engages in certain asset sales, the Issuers will be required under certain circumstances to make an offer to purchase the notes at 100% of the principal amount thereof, plus accrued and unpaid interest to the repurchase date.
On October 13, 2016, the Company issued a press release announcing the offering of the notes. A copy of this press release is attached
hereto as Exhibit 99.1.
On October 20, 2016, the Company issued another press release announcing the pricing of the offering. A copy
of this press release is attached hereto as Exhibit 99.2.
This Current Report on Form 8-K does not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall it constitute an offer to sell, solicitation or sale in any jurisdiction in which such offer, solicitation or sale would be unlawful. Any offers of the securities were made only by means of a
confidential offering memorandum. These securities have not been registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States or to U.S. persons except pursuant to an
exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state laws.