STAINES-UPON-THAMES, United
Kingdom, Nov. 5, 2019
/PRNewswire/ -- Mallinckrodt plc (NYSE: MNK) today
announced the commencement of private offers (each, an "Exchange
Offer" and, collectively, the "Exchange Offers") by its wholly
owned subsidiaries, Mallinckrodt International Finance S.A. and
Mallinckrodt CB LLC (the "Issuers") to exchange:
- any and all of the 4.875% Senior Notes due 2020 (the "Existing
4.875% 2020 Notes") issued by the Issuers for new 10.000% Second
Lien Senior Secured Notes due 2025 to be issued by the Issuers (the
"New Notes"); and
- the 5.750% Senior Notes due 2022 (the "Existing 5.750% 2022
Notes"), 4.750% Senior Notes due 2023 (the "Existing 4.750% 2023
Notes"), 5.625% Senior Notes due 2023 (the "Existing 5.625% 2023
Notes") and 5.500% Senior Notes due 2025 (the "Existing 5.500% 2025
Notes") (collectively, the "Existing Non-2020 Notes", and together
with the Existing 4.875% 2020 Notes, the "Existing Notes") issued
by the Issuers for up to $355 million
of New Notes.
In connection with the Exchange Offers, the Issuers are also
soliciting consents (each, a "Consent Solicitation" and,
collectively, the "Consent Solicitations" and, together with the
Exchange Offers, the "Exchange Offers and Consent Solicitations")
from holders of each series of the Existing Notes (other than the
Existing 4.750% 2023 Notes) to amend (collectively, the "Proposed
Amendments") the indentures governing such series of Existing Notes
(collectively, the "Existing Indentures") to eliminate
substantially all of the restrictive covenants under the Existing
Indentures, modify or eliminate certain other provisions of the
Existing Indentures, and waive certain defaults and events of
default, if any, under the Existing Indentures, subject to the
terms and conditions set forth in the Issuers' confidential
offering memorandum and consent solicitation statement, dated
November 5, 2019 (the "Offering
Memorandum and Consent Solicitation Statement"). If the
Proposed Amendments are adopted, certain terms of these series of
Existing Notes and the corresponding Existing Indentures will be
less restrictive and will afford reduced protection to holders of
such Existing Notes compared to those terms and protections
currently in such Existing Notes and such Existing Indentures or
those terms and protections that will be applicable to the New
Notes. The consent of the holders of a majority of the
aggregate principal amount of the Existing Notes outstanding of
each series that is the subject of a Consent Solicitation will be
required in order to effectuate the Proposed Amendments with
respect to the Existing Indenture for each such series.
The following table sets forth each series of Existing Notes
subject to the Exchange Offers and Consent Solicitations and the
"Exchange Offer Consideration", the "Early Participation Premium"
and the "Total Offer Consideration" offered in the Exchange Offers
and Consent Solicitations.
Existing Notes to
be Exchanged
|
|
Exchange Offer
Consideration(1)
|
|
Early
Participation
Premium(1)
|
|
Total Offer
Consideration(1)(2)
|
Existing 4.875% 2020
Notes
|
|
$800
|
|
$50
|
|
$850
|
Existing 5.750% 2022
Notes
|
|
$425
|
|
$50
|
|
$475
|
Existing 4.750% 2023
Notes
|
|
$320
|
|
$50
|
|
$370
|
Existing 5.625% 2023
Notes
|
|
$375
|
|
$50
|
|
$425
|
Existing 5.500% 2025
Notes
|
|
$375
|
|
$50
|
|
$425
|
__________________
|
(1)
|
For each $1,000
principal amount of the Existing Notes (as defined herein) accepted
for exchange.
|
(2)
|
Includes the Early
Participation Premium (as defined herein).
|
The Exchange Offers and Consent Solicitations are being made
only to Eligible Holders (as defined below) and will expire at the
end of the day, 11:59 p.m.,
New York City time, on
December 4, 2019 (the "Expiration
Time"). The settlement date for the Exchange Offers and
Consent Solicitations will occur promptly after the Expiration Time
(the "Settlement Date"), subject to all conditions to the Exchange
Offers and Consent Solicitations having been satisfied or waived by
the Issuers. Eligible Holders must validly tender (and not
validly withdraw) their Existing Notes at or prior to 5:00 p.m., New York
City time, on November 19,
2019 (the "Early Delivery Time"), in order to be entitled to
receive the applicable "Early Participation Premium" shown in the
table above. Existing Notes tendered after the Early Delivery
Time but prior to the Expiration Time will only be entitled to
receive the applicable "Exchange Offer Consideration" shown in the
table above. Eligible Holders of Existing Notes may deliver
their consent to the Proposed Amendments to the corresponding
Existing Indenture for such series pursuant to the Consent
Solicitations only by tendering Existing Notes of the applicable
series in the applicable Exchange Offer. Eligible Holders may
not deliver a consent pursuant to the Consent Solicitations without
tendering Existing Notes in the applicable Exchange Offer. If
an Eligible Holder tenders Existing Notes in an Exchange Offer,
such Eligible Holder will also be delivering its consent, with
respect to the principal amount of such tendered Existing Notes
that are accepted in such Exchange Offer, to the applicable
Proposed Amendments.
Tenders may be validly withdrawn at any time on or prior to
5:00 p.m., New York City time, on November 19, 2019 (the "Withdrawal Deadline"),
but not thereafter, unless required by law. A valid
withdrawal of tendered Existing Notes will also constitute the
revocation of the related consent to the Proposed Amendments to the
corresponding Existing Indenture for that series. Consents
may only be revoked by validly withdrawing the tendered Existing
Notes prior to the Withdrawal Deadline. An Eligible Holder
must tender all of its Existing Notes in the Exchange Offers in
order to participate in any Exchange Offer. An Eligible
Holder may only withdraw Existing Notes from an Exchange Offer if
it also validly withdraws its tender of all Existing Notes pursuant
to the Exchange Offers.
The New Notes will be secured by a second lien security interest
in all collateral that currently secures Mallinckrodt plc's senior secured credit facilities
(subject to certain exceptions described in the Offering Memorandum
and Consent Solicitation Statement). The New Notes will be
guaranteed by each entity that currently guarantees Mallinckrodt plc's senior secured credit facilities
(subject to certain exceptions described in the Offering Memorandum
and Consent Solicitation Statement). The New Notes will
accrue interest from the date of issuance. Holders will
receive a cash payment for any amounts of accrued and unpaid
interest on the Existing Notes.
The maximum aggregate principal amount of New Notes issued in
the Exchange Offers for the Existing Non-2020 Notes will not exceed
$355 million (the "Maximum Non-2020
Exchange Amount"). In the event that the amount of New Notes
issuable in respect of the Existing Non-2020 Notes would exceed the
Maximum Non-2020 Exchange Amount absent such limitation, but would
not exceed such Maximum Non-2020 Exchange Amount if no Existing
4.750% 2023 Notes were accepted, the Issuers will accept Existing
4.750% 2023 Notes that have been tendered, on a pro rata basis, up
to an aggregate amount such that the New Notes issued in respect of
the Existing Non-2020 Notes will not exceed the Maximum Non-2020
Exchange Amount. In the event that the amount of New Notes
issuable in respect of the Existing Non-2020 Notes would exceed the
Maximum Non-2020 Exchange Amount regardless of whether or not any
Existing 4.750% 2023 Notes were accepted, the Issuers will not
accept any Existing 4.750% 2023 Notes and will accept all other
Existing Non-2020 Notes that have been tendered, on a pro rata
basis, up to an aggregate amount such that the New Notes issued in
respect of such Existing Non-2020 Notes will not exceed the Maximum
Non-2020 Exchange Amount. Accordingly, if the Proposed
Amendments receive the Requisite Consents, a holder who
participates in an Exchange Offer for the Existing Non-2020 Notes
may continue to hold Existing Non-2020 Notes following the
consummation of the Exchange Offers and may no longer benefit from
certain of the protections provided by the Existing Indentures
governing its Existing Non-2020 Notes.
In addition, on November 5, 2019,
Deerfield Partners, L.P., Deerfield Special Situations Fund, L.P.
and Deerfield Private Design Fund IV, L.P. (such holders, the
"Exchanging Holders"), collectively holding approximately
$500.0 million aggregate principal
amount of the Existing Notes (approximately 16.9% of the aggregate
principal amount outstanding), entered into an exchange agreement
(the "Exchange Agreement") with the Issuers. Pursuant to the
Exchange Agreement, the Exchanging Holders agreed to exchange with
the Issuers on the Settlement Date, separate from the Exchange
Offers, their Existing Notes held as of the date of the Exchange
Agreement (comprised of approximately $67.6
million aggregate principal amount of Existing 4.875% 2020
Notes, approximately $258.7 million
aggregate principal amount of the Existing 4.750% 2023 Notes,
approximately $98.5 million aggregate
principal amount of the Existing 5.625% 2023 Notes and
approximately $75.2 million aggregate
principal amount of Existing 5.500% 2025 Notes) for approximately
$227.0 million aggregate principal
amount of New Notes. The exchange by the Exchanging Holders
of Existing Notes on the Settlement Date pursuant to the Exchange
Agreement will not be subject to proration. The Exchanging
Holders have also agreed to consent to the Proposed Amendments with
respect to all of such Exchanging Holders' Existing Notes that are
the subject of the Consent Solicitations. In addition, under
the Exchange Agreement, the Issuers have granted an option to the
Exchanging Holders, exercisable up to five times for 60 days after
the date the Exchange Offers are consummated, to exchange any
Existing Notes they may acquire after the execution of the Exchange
Agreement for up to $100 million
aggregate principal amount of additional New Notes (provided that
any such subsequently acquired Existing Non-2020 Notes may only be
exchanged for up to $75 million
aggregate principal amount of additional New Notes and that the
aggregate principal amount of New Notes to be issued upon the
exercise of each such option may not be less than the lesser of (x)
$10 million and (y) the entire
remaining amount available with respect to such options).
Pursuant to the Exchange Agreement, the Exchanging Holders are
entitled to receive in exchange for their Existing Notes exchanged
in connection with the exercise of such option the same amount of
New Notes that Eligible Holders are entitled to receive in the
applicable Exchange Offers for each $1,000 principal amount of Existing Notes
exchanged.
Each Exchange Offer and corresponding Consent Solicitation for a
series of Existing Notes is being made independently of the
Exchange Offers and Consent Solicitations for the other series of
Existing Notes and is not conditioned upon the completion of any of
the other Exchange Offers and Consent Solicitations. The
Issuers reserve the right to terminate, withdraw or amend each
Exchange Offer or Consent Solicitation without also terminating,
withdrawing or amending any of the other Exchange Offers and
Consent Solicitations. The consummation of each Exchange
Offer and corresponding Consent Solicitation is subject to, and
conditional upon, the satisfaction or waiver of customary
conditions, as described in the Offering Memorandum and Consent
Solicitation Statement. No minimum participation requirement
is applicable to the Exchange Offers and Consent Solicitations.
The New Notes have not been registered under the Securities Act
of 1933, as amended (the "Securities Act") or any state or foreign
securities laws. The New Notes may not be offered or sold in
the United States or to any U.S.
persons except pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities
Act. The Exchange Offers and Consent Solicitations are only
being made to persons who certify that they are (a) "qualified
institutional buyers" as defined in Rule 144A under the Securities
Act or (ii) are not, and are not acting on behalf of, a "U.S.
person" as defined in Rule 902 of Regulation S under the Securities
Act (such persons, "Eligible Holders"). As such, documents
relating to the Exchange Offers and Consent Solicitations will only
be distributed to holders of Existing Notes who complete and return
an eligibility letter ("Eligibility Letter") confirming that they
are Eligible Holders of Existing Notes.
The complete terms and conditions of the Exchange Offers and
Consent Solicitations are described in the Offering Memorandum and
Consent Solicitation Statement, copies of which may be obtained by
Eligible Holders by contacting D.F. King Co., Inc., the exchange
agent and information agent in connection with the Exchange Offers
and Consent Solicitations, at: (866) 356-7814 (toll free) or: (212)
269-5550 (bankers and brokers call collect) or email at
mnk@dfking.com. The Eligibility Letter is available
electronically at: www.dfking.com/mnk.
ABOUT MALLINCKRODT
Mallinckrodt is a global business
consisting of multiple wholly owned subsidiaries that develop,
manufacture, market and distribute specialty pharmaceutical
products and therapies. The company's Specialty Brands
reportable segment's areas of focus include autoimmune and rare
diseases in specialty areas like neurology, rheumatology,
nephrology, pulmonology and ophthalmology; immunotherapy and
neonatal respiratory critical care therapies; analgesics and
gastrointestinal products. Its Specialty Generics reportable
segment includes specialty generic drugs and active pharmaceutical
ingredients. To learn more about Mallinckrodt, visit www.mallinckrodt.com.
Mallinckrodt uses its website as a
channel of distribution of important company information, such as
press releases, investor presentations and other financial
information. It also uses its website to expedite public
access to time-critical information regarding the company in
advance of or in lieu of distributing a press release or a filing
with the U.S. Securities and Exchange Commission (SEC) disclosing
the same information. Therefore, investors should look to the
Investor Relations page of the website for important and
time-critical information. Visitors to the website can also
register to receive automatic e-mail and other notifications
alerting them when new information is made available on the
Investor Relations page of the website.
CAUTIONARY STATEMENTS RELATED TO FORWARD-LOOKING
STATEMENTS
Statements in this document that are not strictly historical,
including statements regarding the terms of the proposed
settlement, statements regarding the ongoing lawsuits against
Mallinckrodt plc and its subsidiaries,
and any other statements regarding events or developments that the
company believes or anticipates will or may occur in the future,
may be "forward-looking" statements within the meaning of the
Private Securities Litigation Reform Act of 1995, and involve a
number of risks and uncertainties.
There are a number of important factors that could cause actual
events to differ materially from those suggested or indicated by
such forward-looking statements and you should not place undue
reliance on any such forward-looking statements. These
factors include risks and uncertainties related to, among other
things: general economic conditions and conditions affecting
the industries in which Mallinckrodt
operates; the commercial success of Mallinckrodt's products; Mallinckrodt's ability to realize anticipated
growth, synergies and cost savings from acquisitions; conditions
that could necessitate an evaluation of Mallinckrodt's goodwill and/or intangible assets
for possible impairment; changes in laws and regulations;
Mallinckrodt's ability to successfully
integrate acquisitions of operations, technology, products and
businesses generally and to realize anticipated growth, synergies
and cost savings; Mallinckrodt's and
Mallinckrodt's licensers' ability to
successfully develop or commercialize new products; Mallinckrodt's and Mallinckrodt's licensers' ability to protect
intellectual property rights; Mallinckrodt's ability to receive procurement and
production quotas granted by the U.S. Drug Enforcement
Administration; customer concentration; Mallinckrodt's reliance on certain individual
products that are material to its financial performance; cost
containment efforts of customers, purchasing groups, third-party
payers and governmental organizations; the reimbursement practices
of a small number of public or private insurers; pricing pressure
on certain of Mallinckrodt's products
due to legal changes or changes in insurers' reimbursement
practices resulting from recent increased public scrutiny of
healthcare and pharmaceutical costs; limited clinical trial data
for Acthar Gel; complex reporting and payment obligations under
healthcare rebate programs; Mallinckrodt's ability to navigate price
fluctuations; future changes to U.S. and foreign tax laws;
Mallinckrodt's ability to achieve
expected benefits from restructuring activities; complex
manufacturing processes; competition; product liability losses and
other litigation liability; ongoing governmental investigations;
material health, safety and environmental liabilities; retention of
key personnel; conducting business internationally; the
effectiveness of information technology infrastructure;
cybersecurity and data leakage risks; Mallinckrodt's substantial indebtedness and its
ability to generate sufficient cash to reduce its indebtedness; any
future actions taken with respect to the Specialty Generics
business; and Mallinckrodt plc's
ability to complete the Exchange Offers, the Consent Solicitations
and the transactions contemplated by the Exchange Agreement,
including the expected timing of completion of the Exchange Offers
and receipt of requisite consents in the Consent Solicitations.
These and other factors are identified and described in more
detail in the "Risk Factors" section of Mallinckrodt's Annual Report on Form 10-K for the
fiscal year ended December 28,
2018. The forward-looking statements made herein speak only
as of the date hereof and Mallinckrodt
does not assume any obligation to update or revise any
forward-looking statement, whether as a result of new information,
future events and developments or otherwise, except as required by
law.
CONTACTS
Investor Relations
Daniel J.
Speciale, CPA
Vice President, Investor Relations and IRO
314-654-3638
daniel.speciale@mnk.com
Media
Daniel Yunger
Kekst CNC
212-521-4879
mallinckrodt@kekstcnc.com
Mallinckrodt, the "M" brand mark and
the Mallinckrodt Pharmaceuticals logo are trademarks of a
Mallinckrodt company. Other
brands are trademarks of a Mallinckrodt
company or their respective owners. © 2019
Mallinckrodt. 9/19
View original content to download
multimedia:http://www.prnewswire.com/news-releases/mallinckrodt-plc-announces-exchange-offers-and-consent-solicitations-300951289.html
SOURCE Mallinckrodt plc