VIVUS,INC. (NASDAQ:VVUS) Files An 8-K Entry into a Material Definitive Agreement

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VIVUS,INC. (NASDAQ:VVUS) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01. Entry into a Material Definitive Agreement.

Senior Secured Notes

On June8, 2018 (the “Issuance Date”), VIVUS,Inc. (the “Company”) entered into an indenture (the “Indenture”) with U.S. Bank National Association as trustee (in such capacity, the “Trustee”) and collateral agent (in such capacity, the “Collateral Agent”) in connection with the issuance of $110 million aggregate principal amount of 10.375% senior secured notes due 2024 (the “Notes”). The Notes will bear interest at a rate of 10.375% per annum payable quarterly in arrears on March31, June30, September30 and December31 of each year, commencing on September30, 2018. In addition, on each interest payment date commencing on June30, 2021, the Company will make mandatory prepayments of principal on each Note in equal installments plus a prepayment fee equal to 1.00% of the principal paid on such interest payment date prior to the maturity date. The Notes will mature on June30, 2024. The Notes, together with the Athyrium Warrants (as defined herein), were issued at an issue price of 99.0%.

The Notes are senior secured obligations of the Company and are secured by a first lien security interest over all current and future assets of the Company, subject to certain exceptions, thresholds and permitted liens, to a collateral agreement, dated as of June8, 2018 (the “Collateral Agreement”), by and among the Company, the other guarantors from time to time party thereto, the Trustee and the Collateral Agent. to the Collateral Agreement, the Collateral Agent will act as collateral agent on behalf of the Trustee and the holders of the Notes. In addition, the Notes will be fully and unconditionally guaranteed by any future domestic subsidiaries of the Company.

The Notes may be redeemed at any time at the Company’s option prior to June8, 2020 at a redemption price equal to (1)50% of the principal amount of Notes being redeemed on any redemption date plus (2)the amount by which (a)the sum of (i)105% of the amount of principal of such Notes to be redeemed plus (ii) the present value at such redemption date of all required interest payments due on the amount of principal of such Notes to be redeemed through June8, 2020 (excluding accrued but unpaid interest, if any, to the redemption date), computed using a discount rate equal to the comparable treasury rate in respect of such redemption date plus 50 basis points, exceeds (b)the amount of principal of such Notes to be redeemed plus (3)a fee equal to 1.00% of the principal amount paid on such redemption date and accrued and unpaid interest to (but not including) the redemption date.

On or after June8, 2020, the Notes may be redeemed at the Company’s option at the redemption prices set forth in the table below, plus a fee equal to 1.00% of the principal amount paid on such redemption date, plus in each case accrued and unpaid interest to (but not including) the redemption date:

Period

RedemptionPrice

From and including June8, 2020 to and including June7, 2021

104.00

%

From and including June8, 2021 to and including June7, 2022

101.00

%

From and including June8, 2022 and thereafter

100.00

%

In addition, under the terms of the Indenture, the Company may issue at its option, within twelve months of the Issuance Date, up to an additional $10 million of Notes (the “Additional Notes”) to the note purchasers, subject to meeting certain conditions.

The Indenture includes customary covenants and events of default, including covenants that, among other things, restrict the incurrence of future indebtedness, the granting of liens, the making of investments, distributions or dividends, and the Company’s ability to merge, consolidate or sell assets, in each case subject to certain exceptions. In addition, the Indenture includes certain financial maintenance covenants related to minimum cash balances and minimum quarterly net revenues related to the Company’s PANCREAZE® product.

Athyrium Warrants

On June8, 2018, the Company issued warrants (the “Athyrium Warrants”) for up to 3,300,000 shares (the “Athyrium Warrant Shares”) of the Company’s common stock, par value $0.001 per share (the “Common Stock”) to affiliates of Athyrium Capital Management (the “Purchasers”). The Athyrium Warrants have a per

share exercise price of $0.3951. The Athyrium Warrants are immediately exercisable, subject to customary anti-dilution adjustments, and will expire six years after such Issuance Date. The Athyrium Warrants also contain customary change of control provisions. In addition, the Company has a right of first offer at a specified Black-Scholes valuation for any transfer of the Athyrium Warrants to a non-affiliated Purchaser.

The net proceeds from the issuance and sale of the Notes and the Athyrium Warrants, after deducting discounts to the purchasers and estimated offering expenses, were approximately $108 million. The Company intends to use such net proceeds from the issuance of the Notes and the Athyrium Warrants to finance a portion of its previously announced acquisition of the rights, title and interest in and to, and the assumption of certain liabilities with respect to, PANCREAZE® and PANCREASE® MT in the U.S. and Canada, including certain related data and intellectual property, from Janssen Pharmaceuticals,Inc. (the “PANCREAZE Acquisition”) and to repurchase $60 million of the Company’s outstanding Convertible Notes due 2020 from the note purchasers or their affiliates for a purchase price of $51 million (plus accrued but unpaid interest to the repurchase date).

The issuance of the Notes, the Athyrium Warrants and the Athyrium Warrant Shares that may be issued to the exercise of the Athyrium Warrants are expected to be exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”), to the exemption for transactions by an issuer not involving any public offering under Section4(a)(2)of the Securities Act.

The foregoing summary of the Indenture, the Notes, the Collateral Agreement and the Athyrium Warrants do not purport to be complete and are qualified in their entirety by reference to the Indenture, the form of Note, the form of Athyrium Warrant, the Collateral Agreement, and the related instruments associated therewith, which are attached hereto as Exhibits 4.1, 4.2, 4.3 and 10.1 and incorporated into this Item 1.01 by reference.

Item 2.01. Completion of Acquisition or Disposition of Assets.

On June8, 2018, the Company closed on the previously disclosed PANCREAZE Acquisition to the Asset Purchase Agreement (the “Asset Purchase Agreement”) between the Company and Janssen Pharmaceuticals,Inc. for a purchase price of $135 million in cash.

The foregoing summary of the Asset Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the Asset Purchase Agreement, a copy of which will be filed with the Company’s Quarterly Report on Form10-Q for the period ending June30, 2018.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information contained under Item 1.01 regarding the Notes and the Athyrium Warrants above is hereby incorporated by reference in its entirety into this Item 2.03.

Item 3.02. Unregistered Sales of Equity Securities.

The information contained above in Item 1.01 regarding the Athyrium Warrants is hereby incorporated by reference into this Item 3.02.

Item 7.01. Regulation FD Disclosure.

On June11, 2018, the Company issued a press release announcing the closing of the PANCREAZE Acquisition and the financing transaction relating to the Notes and the Athyrium Warrants. A copy of the press release is attached hereto as Exhibit99.1 and incorporated into this Item 7.01 by reference.

The information under this Item 7.01 and the related Exhibit99.1 attached hereto shall not be deemed “filed” for purposes of Section18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, or incorporated by reference into any of the Company’s filings under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in any such filing.


VIVUS INC Exhibit
EX-4.1 2 a18-15085_1ex4d1.htm EX-4.1 Exhibit 4.1   VIVUS,…
To view the full exhibit click here

About VIVUS,INC. (NASDAQ:VVUS)

VIVUS, Inc. is a biopharmaceutical company. The Company operates in the development and commercialization of therapeutic products segment. It provides over two therapies approved by the Food and Drug Association (FDA), which include Qsymia (phentermine and topiramate extended-release) for chronic weight management and STENDRA (avanafil) for erectile dysfunction (ED). The Company has completed the Phase II studies of Qsymia for the indication of Obstructive Sleep Apnea (OSA) and diabetes. Its Qsymia is available in over 40,000 certified retail pharmacies across the country. Its STENDRA is also approved by the European Commission (EC), under the name, SPEDRA, for the treatment of ED in the Europe. The United States Food and Drug Association approved a Supplemental New Drug Application (sNDA) for STENDRA. STENDRA is indicated to be taken approximately 15 minutes before sexual activity.