ViroPharma amends exchange for convertibles

New York, May 26 - ViroPharma Inc. said it has amended its exchange offer for its existing 6% convertible subordinated notes due 2007.

The company said it is now setting a minimum price of $2.50 to be used in calculating the number of base shares.

The minimum participation condition is 80% of the existing convertibles.

In addition, ViroPharma extended the exchange to June 11 from midnight ET on May 25.

As of May 25, $7.0 million or 5% of the existing convertibles had been tendered.

ViroPharma said on May 21 it had set pricing on the exchange offer. The company said the new Plus Cash Notes it is offering in exchange for its existing 6% convertibles will be exchangeable for 257.62 shares of its common stock plus $500 in cash, which ViroPharma may pay in stock under certain circumstances.

ViroPharma may exercise the auto-convert option to exchange the new notes for stock any time the closing price of its common stock exceeds $3.88 for 20 out of 30 consecutive trading days.

The base share amount of 257.62 was determined by dividing $952.38 minus the $500 plus cash amount by the simple average of the closing bid price of ViroPharma's common stock on May 17, 18, 19, 20, and 21. The auto-conversion price was determined by dividing $1,500 less the $500 plus cash amount by 257.62, the number of base shares.

If the exchange is extended - as has now occurred - these figures will be recalculated.

ViroPharma announced on April 28 that it had begun an exchange for its existing 6% convertibles.

ViroPharma said that it plans to offer new convertibles in exchange for its existing 6% convertible subordinated notes due 2007 and will also offer for cash $25 million of the new securities.

Under the terms of the exchange, ViroPharma will offer up to $99.1225 million principal amount of 6% convertible senior Plus Cash Notes in exchange for up to all its existing $127.9 million principal amount of 6% convertibles.

ViroPharma said the exchange is intended to extend the maturity of its debt by more than two years, which, the company said, would be "more consistent with its current business plans."

The exchange will also "significantly" reduce the conversion price of the notes.

The extra cash will provide resources to execute the business and operational plans.

According to S-3 and S-4 registration statements filed with the Securities and Exchange Commission, ViroPharma is offering $775 principal amount of the new convertibles for each $1,000 principal amount of the existing convertibles.

The new Plus Cash convertibles will be convertible into $500 in cash plus stock for each $1,000 principal amount. The amount of stock will be set by dividing $452.38 by the daily volume weighted average trading price of the company's stock for the 10 trading days ending on the second trading day before the expiration of the tender offer.

There is an auto conversion feature if the stock trades at a price above $1,000 divided by the number of shares to be issued per note on conversion on 20 out of 30 trading days.

For conversions before June 1, 2006 there is a coupon make-whole.

The existing convertibles convert at $109.15.

Interest on the new convertibles will be at 6% payable in cash or stock at ViroPharma's option.

They will mature on June 1, 2009 and be callable from June 1, 2006 onwards.

Piper Jaffray & Co. is dealer manager for the exchange and placement agent for the cash offer (contact Jeffrey Winaker or Brian Sullivan at 415 984-5142).

ViroPharma is an Exton, Pa., pharmaceutical company.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.