First Horizon Pharmaceutical extends exchange offer for 1.75% convertibles, ups exchange fee

By Angela McDaniels

Seattle, April 19 - First Horizon Pharmaceutical Corp. extended the exchange offer for its 1.75% contingent convertible senior subordinated notes due 2024 to 5 p.m. ET on May 2 and increased the exchange fee to $7.50 from $2.50 per $1,000 principal amount of convertibles, according to a company news release.

As of April 18, the original expiration, $54.635 million of the $150 million convertibles outstanding had been tendered.

The company said it also waived the minimum tender condition to the exchange offer, which required a minimum of $112.5 million of the convertibles to be tendered.

The Alpharetta, Ga., specialty pharmaceutical company began offering new 1.75% contingent convertible senior subordinated notes due 2024 with net share settlement on a one-for-one basis for the existing notes on March 16.

Under the terms of the new notes, conversions will be paid in cash up to the principal amount of the notes. Any remaining value will be paid in stock. The existing notes are convertible into stock only.

The new provision will allow First Horizon to use the treasury method of calculating earnings per share, which is less dilutive.

In addition, the new notes will have change-of-control protection up to March 13, 2007 through an increase in the conversion rate.

UBS Investment Bank is the dealer manager (888 722-9555, ext. 4210), and Morrow & Co. Inc. is the information agent (203 658-9400 or 800 662-5200).

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