VIVUS (VVUS) Launches $200M Convertible Notes Offering
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VIVUS, Inc. (NASDAQ: VVUS) announced today that it intends to offer, subject to market and other conditions, $200 million aggregate principal amount of convertible senior unsecured notes due May 1, 2020 (the “Notes”) through one or more initial purchasers in a private placement pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). VIVUS also intends to grant the initial purchasers a 30-day option to purchase up to an additional $30 million aggregate principal amount of the Notes. VIVUS anticipates using a portion of the net proceeds from the offering to pay the cost of a capped call transaction described below to be entered into with an affiliate of one of the initial purchasers (the “hedge counterparty”), and the remainder of the net proceeds for continued commercialization of its products and development of its product candidates, and for general corporate purposes. If the initial purchasers exercise their option to purchase additional Notes, VIVUS may enter into an additional capped call transaction with the hedge counterparty.
The Notes will be senior unsecured obligations of VIVUS and will accrue interest payable semiannually in arrears.
The Notes will be convertible at the option of the holders at any time prior to the close of business on the business day immediately preceding November 1, 2019 only under certain conditions. On or after November 1, 2019 until the close of business on the second scheduled trading day immediately preceding the maturity date for the Notes, holders will be able to convert their Notes at their option at the conversion rate then in effect at any time, regardless of these conditions. Subject to certain limitations, VIVUS will settle conversions of the Notes by paying or delivering, as the case may be, cash, shares of its common stock or a combination of cash and shares of its common stock, at its election.
The conversion rate of the Notes, and the corresponding conversion price, will be subject to adjustment for certain events, but will not be adjusted for accrued interest. In addition, following certain corporate transactions that occur on or prior to the maturity date for the Notes, VIVUS will increase the conversion rate for a holder that elects to convert its Notes in connection with such a corporate transaction.
VIVUS may not redeem the Notes prior to the maturity date for the Notes, and there is no sinking fund provided for the Notes.
If VIVUS undergoes a fundamental change prior to the maturity date for the Notes, holders may require VIVUS to purchase for cash all or any portion of their Notes at a fundamental change purchase price equal to 100% of the principal amount of the Notes to be purchased, plus accrued and unpaid interest to, but excluding, the fundamental change purchase date.
The Notes will be senior unsecured obligations of VIVUS and will accrue interest payable semiannually in arrears.
The Notes will be convertible at the option of the holders at any time prior to the close of business on the business day immediately preceding November 1, 2019 only under certain conditions. On or after November 1, 2019 until the close of business on the second scheduled trading day immediately preceding the maturity date for the Notes, holders will be able to convert their Notes at their option at the conversion rate then in effect at any time, regardless of these conditions. Subject to certain limitations, VIVUS will settle conversions of the Notes by paying or delivering, as the case may be, cash, shares of its common stock or a combination of cash and shares of its common stock, at its election.
The conversion rate of the Notes, and the corresponding conversion price, will be subject to adjustment for certain events, but will not be adjusted for accrued interest. In addition, following certain corporate transactions that occur on or prior to the maturity date for the Notes, VIVUS will increase the conversion rate for a holder that elects to convert its Notes in connection with such a corporate transaction.
VIVUS may not redeem the Notes prior to the maturity date for the Notes, and there is no sinking fund provided for the Notes.
If VIVUS undergoes a fundamental change prior to the maturity date for the Notes, holders may require VIVUS to purchase for cash all or any portion of their Notes at a fundamental change purchase price equal to 100% of the principal amount of the Notes to be purchased, plus accrued and unpaid interest to, but excluding, the fundamental change purchase date.
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