|
Item 1.01.
|
Entry into a Material Definitive Agreement.
|
Completion of Senior Subordinated Convertible Notes
Offering
On August 11, 2017, BioMarin Pharmaceutical Inc. (the “Company”) completed its registered underwritten public
offering of $450 million aggregate principal amount of its 0.599% Senior Subordinated Convertible Notes due 2024 (such notes, the “Notes,” and such offering, the “Offering”) pursuant to the underwriting agreement
with Merrill Lynch, Pierce, Fenner & Smith Incorporated, Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC, described in Item 8.01 below. The Company also granted the underwriters the option to purchase, within a
period of 13 days from, and including, the date Notes are first issued, up to $45 million aggregate principal amount of additional Notes.
The Notes were offered and sold in a public offering registered under the Securities Act of 1933, as amended (the “Securities Act”),
pursuant to a registration statement on Form S-3 filed with the Securities and Exchange Commission on August 8, 2016, which was effective upon filing (Registration No. 333-212974), including the prospectus supplement filed by the Company
with the Securities and Exchange Commission pursuant to Rule 424(b)(5) under the Securities Act, dated August 7, 2017, to the prospectus contained in the registration statement (the “Registration Statement”).
Base Indenture and Supplemental Indenture
The Company issued the Notes under an indenture, dated as of August 11, 2017 (the “Base Indenture”), between the Company and
Wilmington Trust, National Association, as trustee (the “Trustee”), as supplemented by the first supplemental indenture dated as of August 11, 2017 (the “Supplemental Indenture” and, together with the Base Indenture, the
“Indenture”), between the Company and the Trustee.
The Notes will mature on August 1, 2024 (the “Maturity
Date”), unless earlier converted or repurchased. The notes are unsecured, senior subordinated obligations of the Company and bear interest at a rate of 0.599% per year, payable semiannually in arrears on February 1 and August 1
of each year, beginning on February 1, 2018.
Holders may convert their Notes at their option, at any time prior to the close of
business on the second scheduled trading day immediately preceding the Maturity Date, into shares of the Company’s common stock, together, if applicable, with cash in lieu of any fractional share, at the then-applicable conversion rate.
The Company may not redeem the Notes prior to the Maturity Date. If a Fundamental Change (as defined in the Indenture) occurs at any time,
subject to certain conditions, holders may require the Company to repurchase all or any portion of their Notes at a repurchase price equal to 100% of the principal amount of the Notes to be repurchased plus accrued and unpaid interest, if any, to,
but excluding, the fundamental change repurchase date.
The conversion rate for the Notes is initially 8.0212 shares per $1,000 principal
amount of Notes, which is equivalent to an initial conversion price of approximately $124.67 per share of common stock, representing a conversion premium of approximately 40% over the last reported sale price of $89.05 per share of the
Company’s common stock on The NASDAQ Global Select Market on August 7, 2017. The conversion rate is subject to adjustment upon the occurrence of certain specified events but will not be adjusted for accrued and unpaid interest. In
addition, holders of the Notes who convert their Notes in connection with a Make-Whole Fundamental Change (as defined in the Indenture), will, under certain circumstances, be entitled to an increase in the conversion rate.
The Indenture contains customary events of default including: (1) the Company’s failure to pay when due the principal of or premium,
if any, on the Notes; (2) the Company’s failure to pay an installment of interest on any of the Notes for 30 days after the date when due; (3) the Company’s failure to deliver, when due, the consideration due upon conversion of
any Note, and that failure continues for 10 days; (4) the Company’s failure to perform or observe any other term, covenant or agreement contained in the Notes or the Indenture for a period of 60 days after written notice of such failure,
requiring us to remedy the same, shall have been given (a) to the Company by the Trustee or (b) to the Company and the Trustee by the holders of at least 25% in aggregate principal amount of the Notes then outstanding; (5) the
Company’s failure to make any payment by the end of the applicable grace period, if any, after the maturity of any indebtedness for borrowed money in an amount in excess of $75.0 million, or there is an acceleration of indebtedness for borrowed
money in an amount in excess of $75.0 million because of a default with respect to such indebtedness without such indebtedness having been discharged or such acceleration having been cured, waived,
rescinded or annulled, in either case, for a period of 60 days after written notice (a) to the Company by the Trustee or (ii) to the Company and the Trustee by holders of at least 25%
in aggregate principal amount of the Notes then outstanding; (6) the Company’s failure to give notice of a Fundamental Change or a Make-Whole Fundamental Change, in each case, when due; and (7) certain events of bankruptcy, insolvency
or reorganization with respect to the Company or any of its significant subsidiaries.
If certain bankruptcy and insolvency-related Events
of Defaults occur, the principal of, and accrued and unpaid interest on, all of the then outstanding Notes shall automatically become due and payable. If an event of default other than certain bankruptcy and insolvency-related events of defaults
occurs and is continuing, the Trustee by notice to the Company, or the holders of the Notes of at least 25% in principal amount of the outstanding Notes, by notice to the Company and the Trustee, may declare the principal of, and accrued and unpaid
interest on, all of the then outstanding Notes to be due and payable. Notwithstanding the foregoing, the Indenture provides that, to the extent the Company elects, the sole remedy for an event of default relating to certain failures by the Company
to comply with certain reporting covenants in the Indenture will, for the first 365 days after such event of default, consist exclusively of the right to receive additional interest on the Notes.
The Indenture provides that the Company may, without the consent of the holders of the Notes, consolidate with, merge into or transfer all or
substantially all of its consolidated assets to any corporation organized under the laws of the United States or any of its political subdivisions provided that: (1) the surviving entity (if not the Company) assumes all the Company’s
obligations under the Indenture and the Notes, as provided in the Indenture; (2) at the time of and immediately after giving effect to such transaction, no event of default, and no event which, after notice or lapse of time, would become an
event of default, shall have happened and be continuing; and (3) if the Company will not be the resulting or surviving corporation from the consolidation, merger or transfer, an officer’s certificate and an opinion of counsel, each stating
that the consolidation, merger or transfer complies with the Indenture, have been delivered to the Trustee.
A copy of the Base Indenture
is filed as Exhibit 4.1 to this Current Report and is incorporated herein by reference. A copy of the Supplemental Indenture, including the form of Note, is filed as Exhibit 4.2 to this Current Report and is incorporated herein by reference. The
description of the Notes and the Indenture in this Current Report is a summary and is qualified in its entirety by the terms of the Indenture and the form of Note included therein.