Assertio Therapeutics Announces Exchange Offer of $200 Million of its Currently Outstanding 2.50% Convertible Notes Due 2021
August 09 2019 - 9:28AM
Assertio Therapeutics, Inc. (NASDAQ: ASRT) (“Assertio”) today
announced it has entered into separate, privately negotiated
exchange agreements (the “Exchange Agreements”) with a limited
number of holders of Assertio’s currently outstanding 2.50%
Convertible Notes due 2021 (the “Exchanged Notes”).
“This transaction is a significant milestone for the Company,”
said Arthur Higgins, President and CEO of Assertio. “We have worked
hard to pay down our senior secured debt and with today’s
announcement we have taken a significant step toward addressing our
2021 convertible debt. Importantly, this transaction reduces our
overall leverage and represents further progress in our
transformation to become a leading diversified biopharmaceutical
business.”
Pursuant to the Exchange Agreements, Assertio will exchange
approximately $200 million aggregate principal amount of
Exchanged Notes for a combination of (a) its new 5.00% Convertible
Senior Notes due August 15, 2024 (the “New Convertible
Notes”), (b) a cash payment plus accrued but unpaid interest on the
Exchanged Notes, and (c) an agreed number of shares of Assertio’s
common stock. The transactions are subject to customary closing
conditions and are expected to close on August 13, 2019.
The shares of Assertio’s common stock and the New Convertible Notes
will be issued in private placements exempt from registration in
reliance on Section 4(a)(2) of the Securities Act of 1933, as
amended (the “Securities Act”). Assertio will issue
approximately $120 million aggregate principal amount of New
Convertible Notes, pay an aggregate of approximately $30 million in
cash and issue an aggregate of approximately 15.8 million shares of
its common stock in the transactions. Assertio will not receive any
cash proceeds from the issuance of the New Convertible Notes or the
shares of its common stock.
The New Convertible Notes will bear interest at a rate of 5.00%
per year, payable semiannually in arrears on February 15 and
August 15 of each year, beginning on February 15, 2020,
and will be convertible into cash, shares of Assertio’s common
stock or a combination of cash and shares of Assertio’s common
stock, at Assertio’s election, at an initial conversion rate of
323.5198 shares of Assertio’s common stock per $1,000 principal
amount of New Convertible Notes, which is equivalent to an initial
conversion price of approximately $3.09 per share of Assertio’s
common stock. The New Convertible Notes will mature on
August 15, 2024, unless earlier converted or repurchased in
accordance with their terms prior to such date.
Assertio also entered into an amendment to its senior secured
credit agreement to facilitate the convertible note exchange
transactions.
SunTrust Robinson Humphrey, Inc. acted as Sole Exchange Agent
and Financial Advisor to Assertio in connection with the
transactions and Gibson, Dunn & Crutcher acted as legal counsel
to Assertio.
This news release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of
these securities in any state or jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such state or
jurisdiction.
“Safe Harbor” Statement under the Private Securities
Litigation Reform Act of 1995
This news release contains forward-looking statements.
These statements involve inherent risks and uncertainties
that could cause actual results to differ materially from those
projected or anticipated, including risks related to the proposed
exchange offer and other risks outlined in Assertio’s public
filings with the Securities and Exchange Commission, including
Assertio’s most recent annual report on Form 10-K and subsequent
quarterly reports on Form 10-Q. All information provided in
this news release speaks as of the date hereof. Except as
otherwise required by law, Assertio undertakes no obligation to
update or revise its forward-looking statements.
INVESTOR AND MEDIA CONTACT:
John B. ThomasSenior Vice President, Investor Relations and
Corporate Communications jthomas@assertiotx.com
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