SYNERGY PHARMACEUTICALS INC. (NASDAQ:SGYP) Files An 8-K Entry into a Material Definitive Agreement

SYNERGY PHARMACEUTICALS INC. (NASDAQ:SGYP) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement

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As previously announced, on December12, 2018, Synergy Pharmaceuticals Inc., a Delaware corporation (the “Company”) and its wholly-owned subsidiary, Synergy Advanced Pharmaceuticals,Inc., a Delaware corporation (“Synergy Advanced” and together with the Company, the “Debtors”) filed voluntary petitions for relief (the “Chapter 11 Cases”) under chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the Southern District of New York (the “Court”).

On December12, 2018, as previously disclosed, the Debtors filed a motion in the Chapter 11 Cases seeking, among other things, (a)approval of certain bidding procedures in connection with the contemplated sale of substantially all of the Debtors’ assets (the “Bidding Procedures”) and (b)approval of the sale of substantially all of the Debtors’ assets to Bausch Health Companies,Inc. (“BH”) or another bidder submitting a higher or otherwise better bid in accordance with the Bidding Procedures.

On December31, 2018, the Official Committee of Unsecured Creditors (the “Creditors’ Committee”) and an Ad Hoc Committee of Equity Holders (the “Ad Hoc Equity Committee”) filed a motion objecting to the Bidding Procedures and the related bidding procedures order (the “Bidding Procedures Order”).

On January4, 2019, the Debtors, BH, CRG Servicing, LLC, the Creditors Committee and the Ad Hoc Equity Committee agreed to resolve all disputes concerning the Bidding Procedures and the Bidding Procedures Order. Among other things, the Debtors and BH agreed to amend the asset purchase agreement dated December11, 2018 between the Debtors and BH and its wholly owned subsidiary, Bausch Health Ireland Limited (“Purchaser”).

On January4, 2019, the Debtors entered into an Amended and Restated Asset Purchase Agreement (the “Amended APA”) by and among the Debtors, BH and the Purchaser to which (i)in the event the Amended APA is terminated because BH and the Purchaser is not the successful bidder at the auction, the break-up fee shall be payable upon the earlier of (a)the consummation of a sale transaction with the successful bidder and (b)the 30thcalendar day following the conclusion of the auction and (ii)in the event the Amended APA is terminated on account of certain termination events in the Amended APA and within nine months of such termination, the Debtors consummate an alternative transaction or enter into a definitive agreement with respect to an alternative transaction, the break-up fee shall be payable upon the earlier of (a)the consummation of such alternative transaction and (b)the 30thcalendar day following the Debtors’ entry into a definitive agreement with respect to such alternative transaction.

The foregoing description of the Amended APA does not purport to be complete and is qualified in its entirety by reference to the Amended APA filed as Exhibit2.1 hereto and incorporated herein by reference.

Item 8.01 Other Events.

On January7, 2019, the Bankruptcy Court entered an order (the “Bidding Procedures Order”) that, among other matters, (i)established the bidding procedures (the “Bidding Procedures”) proposed to be employed with respect to the Competitive Process, (ii)established procedures relating to the assumption and assignment of certain executory contracts and unexpired leases, including notice of proposed cure amounts and (iii)set a date for the proposed auction (the “Auction”) for the sale of all or substantially all of the Debtors’ assets (the “Sale Transaction”) and scheduled the hearing (the “Sale Hearing”) to approve the Sale Transaction.

to the Bidding Procedures Order, Qualified Bids (as defined in the Bidding Procedures) must be received in writing on or before February23, 2019 at 4:00 p.m.(prevailing Eastern Time) or such earlier date as may be agreed to in accordance with terms of the Bidding Procedures. The Auction is scheduled for February26, 2019, and the Sale Hearing is scheduled for March1, 2019.

Cautionary Information Regarding Trading in the Company’s Securities.

The Company’s securityholders are cautioned that trading in the Company’s securities during the pendency of the Chapter 11 Filings is highly speculative and poses substantial risks. Trading prices for the Company’s securities may bear little or no relationship to the actual recovery, if any, by holders thereof in the Company’s Chapter 11

Filings. Accordingly, the Company urges extreme caution with respect to existing and future investments in its securities.

A plan of reorganization or liquidation will likely result in holders of the Company’s capital stock receiving no distribution on account of their interests and cancellation of their existing stock. If certain requirements of the Bankruptcy Code are met, a Chapter 11 plan can be confirmed notwithstanding its rejection by the Company’s equity securityholders and notwithstanding the fact that such equity securityholders do not receive or retain any property on account of their equity interests under the plan.

Information about the Chapter 11 process, as well as court filings and other documents related to the reorganization proceedings, is available through the Company’s claims agent, Prime Clerk, at https://cases.primeclerk.com/Synergy or 855-388-4579. Information contained on, or that can be accessed through, such web site or the Court’s web site is not part of this Current Report.

Item 9.01. Financial Statements and Exhibits.

(d)Exhibits. The following exhibits are filed with this report:

SYNERGY PHARMACEUTICALS, INC. Exhibit
EX-2.1 2 a19-2381_1ex2d1.htm EX-2.1 Exhibit 2.1   EXECUTION VERSION   AMENDED AND RESTATED   ASSET PURCHASE AGREEMENT   BY AND AMONG   SYNERGY PHARMACEUTICALS INC.,…
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About SYNERGY PHARMACEUTICALS INC. (NASDAQ:SGYP)

Synergy Pharmaceuticals Inc. (Synergy) is a biopharmaceutical company focused on the development and commercialization of gastrointestinal (GI) therapies. The Company’s GI platform includes two lead product candidates: plecanatide and dolcanatide. It is engaged in the discovery, research and development involving uroguanylin analogs for the treatment of functional GI disorders and inflammatory bowel disease. Plecanatide is the Company’s uroguanylin analog being evaluated for use as a once-daily tablet for two functional GI disorders, chronic idiopathic constipation (CIC) and irritable bowel syndrome with constipation (IBS-C). Plecanatide is a 16-amino acid peptide that is structurally identical to uroguanylin with the exception of a single amino acid change. Dolcanatide is also its uroguanylin analog being explored for inflammatory bowel disease (IBD). Dolcanatide is designed to be an analog of uroguanylin with resistance to standard digestive breakdown by proteases in the intestine.

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