On December 26, 2019 Acorda Therapeutics, Inc. (Nasdaq: ACOR) ("Acorda" or the "Company") reported it has successfully completed its previously announced private exchange of $276 million aggregate principal amount of its 1.75% Convertible Senior Notes due June 2021 (the "Existing Convertible Notes") for a combination of approximately $207 million aggregate principal amount of newly issued 6.00% Convertible Senior Secured Notes due 2024 (the "New Convertible Secured Notes ") and $55.2 million in cash (Press release, Acorda Therapeutics, DEC 26, 2019, View Source [SID1234552607]). The initial conversion rate for the New Convertible Secured Notes is 285.7142 shares of the Company’s common stock per $1,000 principal amount of New Convertible Secured Notes, which is equivalent to an initial conversion price of approximately $3.50 per share, which represents a premium of approximately 97% above the Company’s closing stock price on December 20, 2019.
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"We have taken a significant step to strengthen our capital structure by refinancing approximately $276 million of our debt that matures in 2021 and replacing it with indebtedness that will not mature until December 2024," said Ron Cohen, M.D., Acorda’s President and Chief Executive Officer. "We structured the exchange to both address our near-term obligation and to preserve shareholder value through a substantial conversion premium. This now affords us the runway needed to drive the commercial success of INBRIJA, which addresses the critical unmet need of OFF periods in people living with Parkinson’s."
The Existing Convertible Notes received by the Company in the Exchange were cancelled in accordance with their terms. Accordingly, upon completion of the exchange, $69 million of Existing Convertible Notes remain outstanding.
The Company previously announced the terms of the New Convertible Secured Notes on December 23, 2019. The Company will file a Current Report on Form 8-K with the U.S. Securities and Exchange Commission on December 26, 2019, which will describe the exchange and the terms of the New Convertible Secured Notes, and include copies of the indenture and security agreement relating to the New Convertible Secured Notes.
This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities of the Company. The offer and sale of the New Convertible Secured Notes or the shares of common stock issuable upon their conversion have not been registered under the Securities Act of 1933 (the "Securities Act") or the securities laws of any other jurisdiction, and these securities may not be offered or sold in the United States absent registration or an applicable exemption from the Securities Act and applicable state laws.
J. Wood Capital Advisors LLC is acting as the Company’s financial advisor for the Exchange and Covington & Burling LLP is acting as the Company’s legal advisor.