PACIRA PHARMACEUTICALS,INC. (NASDAQ:PCRX) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01. Entry into a Material Definitive
Agreement.
Purchase Agreement
On March7, 2017, Pacira Pharmaceuticals,Inc. (the Company)
entered into a purchase agreement (the Purchase Agreement) with
J.P. Morgan Securities LLC, Jefferies LLC and RBC Capital
Markets, LLC, as representatives of the several initial
purchasers named therein (collectively, the Initial Purchasers),
to issue and sell $300 million aggregate principal amount of the
Companys 2.375% Convertible Senior Notes due 2022 (the Notes), in
a private placement to qualified institutional buyers to Rule144A
under the Securities Act of 1933, as amended (the Securities
Act). The Notes were issued and sold to the Initial Purchasers to
an exemption from the registration requirements of the Securities
Act afforded by Section4(a)(2)of the Securities Act. In addition,
the Company granted the Initial Purchasers a 30-day option to
purchase up to an additional $45 million aggregate principal
amount of the Notes on the same terms and conditions, which
option was exercised in full by the Initial Purchasers on March8,
2017.
The Purchase Agreement includes customary representations,
warranties and covenants by the Company and customary closing
conditions. Under the terms of the Purchase Agreement, the
Company has agreed to indemnify the Initial Purchasers against
certain liabilities, including liabilities under the Securities
Act. The settlement of the Companys issuance and sale of $345
million aggregate principal amount of Notes to the Initial
Purchasers occurred on March 13, 2017.
Indenture
On March13, 2017, the Company entered into an Indenture relating
to the issuance of the Notes (the Indenture), by and between the
Company and Wells Fargo Bank, National Association, as trustee
(the Trustee). The Notes bear interest at a rate of 2.375%per
year, payable semi-annually on April1 and October1 of each year,
beginning on October1, 2017. The Notes mature on April1, 2022,
unless earlier repurchased or redeemed by the Company or
converted to their terms. The net proceeds from the offering,
including net proceeds from the exercise in full by the Initial
Purchasers of their option to purchase an additional $45 million
in aggregate principal amount of the Notes, are approximately
$333.6 million, after deducting fees and estimated offering
expenses payable by the Company.
The initial conversion rate of the Notes is 14.9491 shares of the
Companys common stock, par value $0.001 per share (the Common
Stock) per $1,000 principal amount of Notes (which is equivalent
to an initial conversion price of approximately $66.89 per
share). The conversion rate of the Notes is subject to adjustment
upon the occurrence of certain specified events. In addition,
upon the occurrence of a make-whole fundamental change (as
defined in the Indenture), the Company will, in certain
circumstances, increase the conversion rate for a holder that
elects to convert its Notes in connection with such make-whole
fundamental change.
Prior to the close of business on the business day immediately
preceding October1, 2021, the Notes are convertible only under
the following circumstances: (1)during any calendar quarter
commencing after the calendar quarter ending on June30, 2017 (and
only during such calendar quarter), if the last reported sale
price of the Common Stock for at least 20 trading days (whether
or not consecutive) during a period of 30 consecutive trading
days ending on the last trading day of the immediately preceding
calendar quarter is greater than or equal to 130% of the
conversion price on each applicable trading day; (2)during the
five business-day period after any five consecutive trading-day
period (the measurement period) in which the trading price per
$1,000 principal amount of Notes for each trading day of the
measurement period was less than 98% of the product of the last
reported sale price of the Common Stock and the conversion rate
on each such trading day; (3)upon the occurrence of specified
corporate events; or (4)upon a Company redemption. On or after
October1, 2021, until the close of business on the second
scheduled trading day immediately preceding April1, 2022, holders
of the Notes may convert all or a portion of their Notes, at any
time. Upon conversion, the Notes will be settled in cash, shares
of the Common Stock or any combination thereof, at the Companys
option.
No sinking fund is provided for the Notes. On or after April1,
2020, and prior to April1, 2022, the Company may redeem for
cash all or part of the Notes if the last reported sales price
of Common Stock exceeds 130% of the conversion price then in
effect for at least 20 trading days (whether or not
consecutive) during any 30 consecutive trading days ending
within five trading days prior to the date on which the Company
provides notice of the redemption. The redemption price of each
Note to be redeemed will be the principal amount of such Note,
plus accrued and unpaid interest, if any. In addition, calling
any Notes for redemption will constitute a make-whole
fundamental change with respect to those Notes, in which case
the conversion rate applicable to those Notes, if converted in
connection with the redemption, will be increased in certain
circumstances. Upon the occurrence of a fundamental change (as
defined in the Indenture), holders may require the Company to
repurchase all or a portion of their Notes for cash at a price
equal to 50% of the principal amount of the Notes to be
repurchased plus any accrued and unpaid interest.
The Notes are the Companys general unsecured obligations that
rank senior in right of payment to all of its indebtedness that
is expressly subordinated in right of payment to the Notes. The
Notes are also effectively junior in right of payment to any of
its secured indebtedness to the extent of the value of the
assets securing such indebtedness, and are structurally
subordinated to any debt or other liabilities (including trade
payables) of the Companys subsidiaries.
The Indenture provides for customary events of default, which
include (subject in certain cases to grace and cure periods),
among others: nonpayment of principal or interest; breach of
covenants or other agreements in the Indenture; defaults with
respect to certain other indebtedness; failure to pay certain
final judgments; and certain events of bankruptcy, insolvency
or reorganization. Generally, if an event of default occurs and
is continuing under the Indenture, either the Trustee or the
holders of at least 25% in aggregate principal amount of the
Notes then outstanding may declare the principal amount plus
accrued and unpaid interest on the Notes to be immediately due
and payable.
The summary of the foregoing transactions is qualified in its
entirety by reference to the text of the Indenture relating to
the issuance of the Notes, the Formof 2.375% Convertible Senior
Note due 2022, which are filed as Exhibits 4.1 and 4.2,
respectively, hereto and are incorporated herein by reference.
Item2.03. Creation of a Direct
Financial Obligation or an Obligation under an Off-Balance
Sheet Arrangement of a Registrant.
The information set forth in Item1.01 above is incorporated
herein by reference.
Item3.02. Unregistered Sales of Equity
Securities.
The information set forth in Item1.01 above relating to the
private placement of the Notes and Item8.01 below under the
heading Note Exchanges is incorporated herein by reference. A
maximum of 7,091,441 shares of Common Stock (subject to
adjustment) may be issued upon conversion of the Notes,
assuming the Company elects to physically settle conversions at
the initial maximum conversion rate of the Notes.
Item8.01. Other Events.
Note Exchanges
On March7, 2017, the Company entered into separate privately
negotiated agreements with certain holders of its outstanding
3.25% convertible senior notes due 2019 (the 2019 Notes) to
exchange shares of Common Stock, together with cash in private
placement transactions to Section4(a)(2)of the Securities Act
(the Exchange Transactions). In exchange for approximately $112
million in principal amount of 2019 Notes, the Company paid
approximately $113 million in cash in respect of the principal
amount and accrued interest, together with an aggregate of
approximately 2.4 million shares of Common Stock. Each holder
of 2019 Notes that participated in the Exchange Transaction
represented to the Company that it was either an institutional
accredited investor within the
meaning of Rule501 of Regulation D promulgated under the
Securities Act or a qualified institutional buyer within the
meaning of Rule144A promulgated under the Securities Act.
The closings of the Exchange Transactions occurred on March13,
2017.
Following the closings of the Exchange Transactions,
approximately $6.1 million aggregate principal amount of the
2019 Notes remains outstanding.
This Current Report on Form8-K does not constitute an offer to
sell, or a solicitation of an offer to buy, any security and
shall not constitute an offer, solicitation or sale in any
jurisdiction in which such offering would be unlawful.
Item 9.01. Financial Statements and
Exhibits.
(d)Exhibits.
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Exhibit No. |
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Description |
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4.1 |
Indenture, dated as of March13, 2017, by and between the |
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4.2 |
Formof Global 2.375% Convertible Senior Notes due 2022 |
About PACIRA PHARMACEUTICALS, INC. (NASDAQ:PCRX)
Pacira Pharmaceuticals, Inc. is a specialty pharmaceutical company. The Company is focused on the development, commercialization and manufacture of pharmaceutical products, based on its DepoFoam drug delivery technology, for use in hospitals and ambulatory surgery centers. Its primary focus lies in the development of non-opioid products for postsurgical pain control. The Company’s lead product candidate, EXPAREL (bupivacaine liposome injectable suspension), which consists of bupivacaine encapsulated in DepoFoam, and is an amide-type local anesthetic indicated for single-dose infiltration into the surgical site to produce postsurgical analgesia. In addition to EXPAREL, DepoFoam is also the basis for its other commercial product, DepoCyt(e), which the Company manufactures for its commercial partners, as well as its other product candidates. The Company’s other product candidates include DepoMeloxicam (DepoMLX) and DepoTranexamic Acid (DepoTXA). PACIRA PHARMACEUTICALS, INC. (NASDAQ:PCRX) Recent Trading Information
PACIRA PHARMACEUTICALS, INC. (NASDAQ:PCRX) closed its last trading session down -0.25 at 46.40 with 592,499 shares trading hands.