Progenity partially exercises greenshoe on 7.25% convertibles

Chicago, Dec. 7 – Progenity Inc. issued a total of $164,025,000 of 7.25% convertible notes with a 2025 maturity on Monday, including a partial $10,525,000 exercise of the greenshoe option by the initial purchaser of the notes.

The total greenshoe option is for $15 million for 13 days from the Dec. 2 issue date, according to an 8-K filing with the Securities and Exchange Commission.

The issued total includes the announced $75 million Rule 144A offering, the greenshoe amount and $78.5 million that was issued to investors that were affiliated with Athyrium Capital Management, LP.

The acquisition of the $78.5 million of notes by the affiliated investors were issued in exchange for discharge of amounts outstanding under the company’s credit and security agreement with a fund managed by Athyrium.

The notes were issued on Dec. 7 and form part of the same series of notes as the other notes issued in the offering.

However, the notes will initially be issued in certified form, and they will be subject to different transfer restrictions and will not initially be fungible with the other notes in the offering.

Affiliated investors of Athyrium additionally purchased another, separate $25 million of the Rule 144A offering.

Piper Sandler Co. is the bookrunner for the Rule 144A offering.

The notes are non-callable until Dec. 1, 2023 and then subject to a 130% hurdle.

They are putable upon a fundamental change.

The notes will be settled in stock with cash paid in lieu of fractional shares.

Proceeds from the concurrent offerings will be used for operational support, the company’s molecular testing research and development program, research and development with respect to its precision medicine platform and for working capital and general corporate purposes.

Progenity is a San Diego-based biotechnology company.

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