Questcor to redeem all outstanding series B convertible preferreds

By Sheri Kasprzak

New York, Nov. 21 - Questcor Pharmaceuticals, Inc. said it intends to redeem all of its outstanding series B convertible preferred stock.

The preferreds will be redeemed on Jan. 3, 2006.

The holders have the option to convert all or part of their preferreds into common shares before the redemption deadline.

Assuming the preferreds are fully redeemed, the shareholders will receive a cash payment of $9,217,190 and the preferreds will be convertible into a total of 8,898,215 common shares.

"This continues our efforts to improve our financial position and is another important step in our strategy to reshape Questcor into a leading specialty pharmaceutical company focusing on neurological disorders," said Jim Fares, the company's chief executive officer, in a statement. "Assuming full redemption, we will avoid potential dilution of 8,898,215 common shares and eliminate our cash dividend obligation, the series B liquidation preference and the restrictive covenants, while maintaining a projected cash balance of approximately $17 million as of the redemption date."

Based in Union City, Calif., Questcor develops novel treatments for neurological disorders.

On Monday, the company's stock closed down 3 cents at $0.87.

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