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SUPN > SEC Filings for SUPN > Form 8-K on 9-May-2013All Recent SEC Filings

Show all filings for SUPERNUS PHARMACEUTICALS INC | Request a Trial to NEW EDGAR Online Pro



Entry into a Material Definitive Agreement, Creation of a Direct Fin

Item 1.01 Entry Into a Material Definitive Agreement

On May 3, 2013, Supernus Pharmaceuticals, Inc. (the "Company") issued $90.0 million aggregate principal amount of 7.50% Convertible Senior Secured Notes due 2019 (the "Notes") in a private placement in reliance on
Section 4(2) under the Securities Act of 1933, as amended (the "Securities Act"), for resale in transactions exempt from the registration requirements of the Securities Act to persons reasonably believed by the initial purchasers to be "qualified institutional buyers" as defined in Rule 144A under the Securities Act.

The offering generated net proceeds of approximately $86.4 million. Aggregate estimated offering expenses in connection with the transaction, including the initial purchasers' discount of $3.2 million, were approximately $3.6 million. The Company used approximately $19.6 million to repay in full its borrowings under and terminate its secured credit facility. The remainder of the net proceeds will be used to fund the commercialization of the Company's approved and tentatively approved drugs, Oxtellar XR and Trokendi XR, to continue development of the Company's pipeline products and for other general corporate purposes, which may include research and development expenses, capital expenditures, working capital and general administrative expenses.

The Company issued the Notes under an Indenture, dated May 3, 2013 (the "Indenture"), between the Company and U.S. Bank National Association, as Trustee and Collateral Agent, which Indenture is filed hereto as Exhibit 4.1. The Notes provide for 7.50% interest per annum on the principal amount of the Notes, payable semi-annually in arrears on May 1 and November 1 of each year, beginning on November 1, 2013. Interest will accrue on the Notes from and including May 3, 2013, and the Notes will mature on May 1, 2019, unless earlier converted, redeemed or repurchased by the Company. The Notes are convertible into the Company's common stock ("Common Stock") as described below.

The Notes are the Company's senior secured obligations and (i) rank senior in right of payment to any of the indebtedness that is expressly subordinated in right of payment to the Notes; (ii) rank effectively senior to any of the unsecured indebtedness to the extent of the value of the collateral securing the Notes; (iii) rank equal in right of payment with all of the Company's indebtedness that is not subordinated to the Notes; and (iv) are structurally subordinated to all indebtedness and liabilities, including trade payables, of the Company's existing and future subsidiaries.

The Notes are secured by a first-priority lien, other than customary permitted liens, on substantially all of the Company's and its domestic subsidiaries' assets, whether now owned or hereafter acquired, including license agreements, general intangibles, accounts, instruments, investment property, intellectual property and any proceeds of the foregoing pursuant to that certain Security and Pledge Agreement, dated May 3, 2013 (the "Security Agreement"), between the Company and U.S. Bank National Association, as Collateral Agent, which is filed hereto as Exhibit 4.3. The Indenture restricts the Company and its existing and future subsidiaries ability to make investments, including transfers of the Company's assets that constitute collateral securing the Notes, in its existing and future foreign subsidiaries. The Company is entitled to the release of property and other assets constituting collateral from the liens securing the Notes and the obligations thereunder (i) to enable the Company to consummate the sale, transfer, license, monetization or other disposition of such property or assets; (ii) with the consent of the holders of at least 66 2/3% of the aggregate principal amount of the Notes then outstanding and affected; or
(iii) pursuant to a modification or amendment of the Indenture, the Notes or the Security Agreement. It will be an event of default under the Indenture governing the Notes if the Notes are not secured by the assets constituting collateral (other than excluded collateral) within 45 days after the closing of the offering of the Notes.

Upon conversion of a Note, if the Company has not received stockholder approval (as defined in the Indenture), a holder of Notes may surrender all or a portion of its Notes for conversion at any time prior to the close of business on the business day immediately preceding the maturity date and the Company will deliver for each $1,000 principal amount of converted Notes a number of shares of Common Stock equal to the conversion rate, together with a cash payment in lieu of any fractional shares of Common Stock issuable upon conversion. If the Company obtains stockholder approval, (i) on and after such date of approval and prior to the close of business on the business day immediately preceding November 1, 2018, a holder of Notes may convert all or a portion of its Notes, in principal amounts equal to $1,000 or an integral multiple thereof, only if one or more of the following conditions has been satisfied: (1) if, for at least 20 trading days (whether or not consecutive) during the 30 consecutive trading day period ending within five trading days prior to a conversion date, the last reported sale price of the Company's Common Stock exceeds the conversion price on each such trading day; (2) during the five consecutive business day period immediately following any five consecutive trading day period (the ''Measurement . . .

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

The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.

Item 3.02 Unregistered Sales of Equity Securities

The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.

The Notes and underlying Company Stock issuable upon conversion of the Notes have not been and will not be registered under the Securities Act, and may not be offered or sold in the United States absent registration or an application exemption from registration requirements.

Item 8.01 Other Events

On May 6, 2013, Supernus issued a press release announcing the closing of its offering of the Notes, a copy of which is furnished hereto as Exhibit 99.1 and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

4.1 Indenture dated as of May 3, 2013 by and between Supernus Pharmaceuticals, Inc. and U.S. Bank National Association, as Trustee and Collateral Agent.

4.2 Form of 7.50% Convertible Senior Secured Note due 2019 (included in Exhibit 4.1).

4.3 Security and Pledge Agreement dated as of May 3, 2013, between the Company and U.S. Bank National Association, as Collateral Agent.

The following document is furnished as an Exhibit to Item 8.01 hereof:

99.1 Press Release, dated May 6, 2013.

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