Item 1.01. Entry Into or Amendment of a Material Definitive
Agreement.
On February 10, 2020, Collegium
Pharmaceutical, Inc. (the “Company”) entered into an underwriting agreement (the “Underwriting
Agreement”) with an underwriter (the “Underwriter”) agreeing, subject to customary conditions, to issue and
sell $125,000,000 principal amount of the Company’s 2.625% Convertible Senior Notes due 2026 (the “Notes”)
to the Underwriter. In addition, pursuant to the Underwriting Agreement, the Company granted the Underwriter an option, which
is exercisable within 30 days after February 10, 2020, to purchase up to an additional $18,750,000 principal amount of Notes
solely to cover over-allotments. On February 11, 2020, the Underwriter exercised such option to purchase an additional
$18,750,000 principal amount of Notes. The issuance of $143,750,000 principal amount of Notes was completed on February 13,
2020. The Notes were issued pursuant to, and are governed by, an indenture and a supplemental indenture (such indenture, as
supplemented by such supplemental indenture, the “Indenture”), dated as of February 13, 2020, between the Company
and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”). As previously disclosed, the
Notes were issued in connection with funding the Nucynta Transaction, and the proceeds of the Notes issuance were used to
finance a portion of the purchase price payable pursuant to the Purchase Agreement.
The Notes will be the Company’s senior,
unsecured obligations and will be (i) equal in right of payment with the Company’s existing and future senior, unsecured
indebtedness; (ii) senior in right of payment to the Company’s existing and future indebtedness that is expressly subordinated
to the Notes; (iii) effectively subordinated to the Company’s existing and future secured indebtedness, to the extent of
the value of the collateral securing that indebtedness; and (iv) structurally subordinated to all existing and future indebtedness
and other liabilities, including trade payables, and (to the extent the Company is not a holder thereof) preferred equity, if any,
of the Company’s subsidiaries.
The Notes will accrue interest at a rate
of 2.625% per annum, payable semi-annually in arrears on February 15 and August 15 of each year, beginning on August 15, 2020.
The Notes will mature on February 15, 2026, unless earlier repurchased, redeemed or converted. Before August 15, 2025, noteholders
will have the right to convert their Notes only upon the occurrence of certain events. From and after August 15, 2025, noteholders
may convert their Notes at any time at their election until the close of business on the scheduled trading day immediately before
the maturity date. The Company will settle conversions by paying or delivering, as applicable, cash, shares of its common stock
or a combination of cash and shares of its common stock, at the Company’s election. The initial conversion rate is 34.2618
shares of common stock per $1,000 principal amount of Notes, which represents an initial conversion price of approximately $29.19
per share of common stock. The conversion rate and conversion price will be subject to customary adjustments upon the occurrence
of certain events. In addition, if certain corporate events that constitute a “Make-Whole Fundamental Change” (as defined
in the Indenture) occur, then the conversion rate will, in certain circumstances, be increased for a specified period of time.
The Notes will be redeemable (an “Optional
Redemption”), in whole and not in part, at the Company’s option at any time on or after February 15, 2023, at a cash
redemption price equal to the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding,
the redemption date, but only if the last reported sale price per share of the Company’s common stock exceeds 130% of the
conversion price on (i) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending
on, and including, the trading day immediately before the date the Company sends the related redemption notice; and (2) the trading
day immediately before the date the Company sends such notice. In addition, calling the Notes for Optional Redemption will constitute
a Make-Whole Fundamental Change, which will result in an increase to the conversion rate in certain circumstances for a specified
period of time.
If certain corporate events that constitute
a “Fundamental Change” (as defined in the Indenture) occur, then noteholders may require the Company to repurchase
their Notes at a cash repurchase price equal to 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 definition of Fundamental Change includes certain business
combination transactions involving the Company and certain de-listing events with respect to the Company’s common stock.
The Notes will have customary provision
relating to the occurrence of “Events of Default” (as defined in the Indenture), which include the following: (i) certain
payment defaults on the Notes (which, in the case of a default in the payment of interest on the Notes, will be subject to a 30-day
cure period); (ii) the Company’s failure to send certain notices under the Indenture within specified periods of time; (iii)
the Company’s failure to comply with certain covenants in the Indenture relating to the Company’s ability to consolidate
with or merge with or into, or sell, lease or otherwise transfer, in one transaction or a series of transactions, all or substantially
all of the assets of the Company and its subsidiaries, taken as a whole, to another person; (iv) a default by the Company in its
other obligations or agreements under the Indenture or the Notes if such default is not cured or waived within 60 days after notice
is given in accordance with the Indenture; (v) certain defaults by the Company or any of its subsidiaries with respect to indebtedness
for borrowed money of at least $20,000,000; (viii) the rendering of certain judgments against the Company or any of its subsidiaries
for the payment of at least $20,000,000, where such judgments are not discharged or stayed within 60 days after the date on which
the right to appeal has expired or on which all rights to appeal have been extinguished; and (ix) certain events of bankruptcy,
insolvency and reorganization involving the Company or any of the Company’s significant subsidiaries.
If an Event of Default involving bankruptcy,
insolvency or reorganization events with respect to the Company (and not solely with respect to a significant subsidiary of the
Company) occurs, then the principal amount of, and all accrued and unpaid interest on, all of the Notes then outstanding will immediately
become due and payable without any further action or notice by any person. If any other Event of Default occurs and is continuing,
then, the Trustee, by notice to the Company, or noteholders of at least 25% of the aggregate principal amount of Notes then outstanding,
by notice to the Company and the Trustee, may declare the principal amount of, and all accrued and unpaid interest on, all of the
Notes then outstanding to become due and payable immediately. However, notwithstanding the foregoing, the Company may elect, at
its option, that the sole remedy for an Event of Default relating to certain failures by the Company to comply with certain reporting
covenants in the Indenture consists exclusively of the right of the noteholders to receive special interest on the Notes for up
to 180 days at a specified rate per annum not exceeding 0.50% on the principal amount of the Notes.
The above description of the Underwriting
Agreement, the Indenture and the Notes is a summary and is not complete. A copy of the Underwriting Agreement, the Indenture and
the form of the certificate representing the Notes are filed as exhibits 1.1, 4.1, 4.2 and 4.3 to this Current Report on Form 8-K,
and the above summary is qualified by reference to the terms of the Underwriting Agreement, the Indenture and the Notes set forth
in such exhibits.