LANTHEUS HOLDINGS, INC. (NASDAQ:LNTH) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement
On June 19, 2020, as contemplated by the Merger Agreement, Lantheus Holdings entered into a Contingent Value Rights Agreement (the CVR Agreement) with Computershare, Inc., a Delaware corporation, and its wholly owned subsidiary, Computershare Trust Company, N.A., a federally chartered trust company, collectively, as rights agent. Each contingent value right (a CVR) issued thereunder entitles its holder to receive his, her or its pro rata share of aggregate cash payments equal to 40% of U.S. net sales generated by PyLTM (F-DCFPyL), Progenics prostate-specific membrane antigen targeted imaging agent designed to visualize prostate cancer currently in late stage clinical development, in calendar years 2022 and 2023 in excess of $100 million and $150 million, respectively, subject to and in accordance with the terms of the CVR Agreement, including the aggregate payment cap specified therein.
The description of the CVR Agreement contained in this Item 1.01 does not purport to be complete and is qualified in its entirety by reference to the full text of the CVR Agreement, a copy of which is filed hereto as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
The information set forth in the Explanatory Note and Item 2.01 of this Current Report on Form 8-K is incorporated by reference into this Item 1.01.
Item 2.01 Completion of Acquisition or Disposition of Assets
In accordance with the Merger Agreement, at the effective time of the Merger (the Effective Time), each share of Progenics common stock, par value $0.0013 per share, issued and outstanding immediately prior to the Effective Time (other than shares of Progenics common stock owned by Lantheus Holdings, Progenics or any of their wholly-owned subsidiaries) was automatically cancelled and converted into the right to receive (1) 0.31 (the Exchange Ratio) of a share of Lantheus Holdings common stock, par value $0.01 per share, and (2) one CVR (collectively, the Merger Consideration). No fractional shares of Lantheus Holdings common stock have been or will be issued in the Merger, and Progenics former stockholders have received or will receive cash in lieu of any fractional shares of Lantheus Holdings common stock.
In addition, in accordance with the Merger Agreement, at the Effective Time, each Progenics stock option with a per share exercise price that does not exceed $4.42 (an in-the-money Progenics stock option) became entitled to receive in exchange for each such in-the money Progenics stock option (1) an option to purchase Lantheus Holdings common stock (each, a Lantheus Holdings Stock Option) converted based on the Exchange Ratio and (2) a vested or unvested CVR depending on whether the underlying in-the-money Progenics stock option was vested at the Effective Time. Each Progenics stock option with a per share exercise price that does exceed $4.42 (an out-of-the-money Progenics stock option) became entitled to receive Lantheus Holdings Stock Options converted on an exchange ratio determined based on the average of the volume weighted average price per share of common stock of Progenics and Lantheus Holdings prior to the Effective Time, which exchange ratio was 0.31.
Lantheus Holdings expects to issue up to 26,844,957 shares of Lantheus Holdings common stock and 86,630,634 CVRs to former Progenics stockholders in connection with the Merger. Lantheus Holdings also expects to assume up to 34,000 in-the-money Progenics stock options and 6,507,342 out-of-the-money Progenics stock options, each to be converted into Lantheus Holdings Stock Options at the exchange ratios noted above.