On January 31, 2024 Immunocore Holdings plc (Nasdaq: IMCR) reported the pricing of $350.0 million aggregate principal amount of 2.50% convertible senior notes due 2030 (the "notes") in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"). Immunocore also granted the initial purchasers of the notes an option to purchase, for settlement within a period of 13 days from, and including, the date the notes are first issued, up to an additional $52.5 million aggregate principal amount of the notes (Press release, Immunocore, JAN 30, 2024, View Source [SID1234639745]). The sale of the notes is expected to close on February 2, 2024, subject to the satisfaction of customary closing conditions. The offering was upsized from the previously announced offering of $300.0 million aggregate principal amount of convertible senior notes.
Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:
Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing
Schedule Your 30 min Free Demo!
The notes will be senior, unsecured obligations of Immunocore and will accrue interest at a rate of 2.50% per annum, payable semi-annually in arrears on February 1 and August 1 of each year, beginning on August 1, 2024. The notes will mature on February 1, 2030, unless earlier converted, redeemed or repurchased.
Holders may convert all or any portion of their notes at their option at any time prior to the close of business on the business day immediately preceding the maturity date. Upon conversion, Immunocore will deliver for each $1,000 principal amount of converted notes a number of ordinary shares represented by American Depositary Shares (the "ADSs") (each currently representing one of Immunocore’s ordinary shares), equal to the conversion rate. The conversion rate will initially be 10.5601 ADSs per $1,000 principal amount of notes (equivalent to an initial conversion price of approximately $94.70 per ADS). The initial conversion price represents a premium of approximately 40.0% above the last reported sale price of $67.64 per ADS on the Nasdaq Global Select Market on January 30, 2024. The conversion rate will be subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest. In addition, following certain corporate events that occur prior to the maturity date or if Immunocore delivers a notice of optional redemption or a notice of tax redemption, Immunocore will, in certain circumstances, increase the conversion rate for a holder who elects to convert its notes in connection with such a corporate event or convert its notes called (or deemed called) for redemption in connection with such notice of optional redemption or notice of tax redemption, as the case may be.
Immunocore may not redeem the notes prior to February 5, 2027, except in the event of certain tax law changes as described in the indenture that will govern the notes. Immunocore may redeem for cash all or any portion of the notes (subject to certain limitations), at its option, on or after February 5, 2027 if the last reported sale price of ADSs has been at least 130% of the conversion price for the notes then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which Immunocore provides notice of optional redemption at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to, but excluding, the optional redemption date. No sinking fund is provided for the notes.
If Immunocore undergoes a "fundamental change" (as defined in the indenture that will govern the notes), then, subject to certain conditions and limited exceptions, holders may require Immunocore to repurchase for cash all or any portion of their notes at a fundamental change repurchase price equal to 100% of the principal amount of the notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date.
Immunocore estimates that the net proceeds from the offering will be approximately $338.4 million (or approximately $389.3 million if the initial purchasers exercise their option to purchase additional notes in full), after deducting the initial purchasers’ discounts and commissions and estimated offering expenses payable by Immunocore. Immunocore intends to use the net proceeds from the offering, together with its existing cash and cash equivalents, to accelerate its clinical pipeline and for ongoing commercial expansion. In addition, Immunocore intends to repay in full loans outstanding under its loan agreement with investment funds managed by Pharmakon Advisors, LP. Immunocore intends to use any remaining proceeds for other working capital and general corporate purposes.
The offer and sale of the notes, the ADSs deliverable upon conversion of the notes and the ordinary shares represented thereby have not been, and will not be, registered under the Securities Act or any other securities laws, and the notes, such ADSs and such shares cannot be offered or sold except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and any other applicable securities laws.
This press release does not constitute an offer to sell, or the solicitation of an offer to buy, the notes, the ADSs deliverable upon conversion of the notes or the ordinary shares represented thereby, nor will there be any sale of the notes, such ADSs or such shares, in any state or other jurisdiction in which such offer, sale or solicitation would be unlawful.