LAVAL, Quebec, April 1, 2015 /CNW/ -- Salix Pharmaceuticals,
Ltd. (the "Company" or "Salix"), a wholly owned subsidiary of
Valeant Pharmaceuticals International, Inc. (NYSE: VRX) (TSX:VRX),
today announced that it today provided a Notice of Fundamental
Changes, Make-Whole Fundamental Changes and Merger Event,
Fundamental Change Company Notice, Notice of Execution of
Supplemental Indenture and Offer to Purchase (the "Notice") to
holders of its 1.5% Convertible Senior Notes due 2019 (the
"Notes"), pursuant to the Indenture, dated as of March 16, 2012 (the "Indenture"), by and between
the Company and U.S. Bank National Association, as trustee (the
"Trustee"). Capitalized terms used herein, unless otherwise
defined herein, shall have the meanings given to such terms in the
Indenture.
The consummation of the tender offer (the "Offer") and the
consummation of the merger (the "Merger"), in each case on
April 1, 2015, contemplated by the
Agreement and Plan of Merger, dated as of February 20, 2015 and as amended as of
March 16, 2015 (as amended, the
"Merger Agreement"), by and among the Company, Valeant
Pharmaceuticals International ("VPI"), Sun Merger Sub, Inc. and
Valeant Pharmaceuticals International, Inc. ("Valeant"), each
constitute a Fundamental Change and a Make-Whole Fundamental
Change, and the consummation of the Merger constitutes a Merger
Event. The delisting of the Common Stock from the NASDAQ
Global Select Market also constitutes a Fundamental Change.
The Effective Date of each Fundamental Change, each Make-Whole
Fundamental Change and the Merger Event is April 1, 2015, the date of the consummation of
the Offer and the Merger (the "Effective Date").
Pursuant to Section 16.04(a) of the Indenture, subject to
certain conditions, each Noteholder has the right (the "Fundamental
Change Repurchase Right"), at such Noteholder's option, to require
the Company to repurchase all of such Noteholder's Notes, or any
portion thereof that is an integral multiple of $1,000 principal amount, on April 30, 2015 (the "Fundamental Change
Repurchase Date"). The Company will repurchase Notes validly
surrendered by Noteholders for repurchase and not validly withdrawn
at a price (the "Fundamental Change Repurchase Price") equal to
100% of the principal amount thereof, plus any accrued and
unpaid interest thereon to, but excluding, the Fundamental Change
Repurchase Date. The Fundamental Change Repurchase Price,
including accrued interest, is $1,001.88 per $1,000 principal amount of Notes validly
surrendered for repurchase and not validly withdrawn.
Noteholders may exercise the right to require the Company to
repurchase a Noteholder's Notes by (i) delivering to the Paying
Agent, at or prior to 5:00 p.m.
(New York City time) on the
Business Day immediately preceding the Fundamental Change
Repurchase Date (such time, the "Expiration Time" and such Business
Day, the "Expiration Date"), a duly completed notice (the
"Fundamental Change Repurchase Notice"), a form of which is
attached as Exhibit A to the Notice (provided that, if the
Notes are not in certificated form, the Fundamental Change
Repurchase Notice must comply with the appropriate procedures of
The Depository Trust Company [the "Depositary," and such
procedures, the "Applicable Procedures"]) and (ii) delivering such
Notes, if such Notes are in certificated form, to the Paying Agent
(together with all necessary endorsements), or delivering such
Notes, if such Notes are held as beneficial interests in a Global
Note, by book-entry transfer to the Paying Agent in compliance with
the Applicable Procedures, in each case at any time after delivery
of the Fundamental Change Repurchase Notice but at or prior to the
Expiration Time, as further described under "Repurchase Procedure"
in the Notice.
Any Noteholder may withdraw, in whole or in part, its submission
of a Fundamental Change Repurchase Notice by means of a written
notice of withdrawal (a "Withdrawal Notice") delivered to the
Corporate Trust Office of the Paying Agent at any time prior to the
Expiration Time, specifying: (i) the certificate number, if any, of
the Note in respect of which such Withdrawal Notice is being
submitted, (ii) the principal amount of the Note with respect to
which such Withdrawal Notice is being submitted and (iii) the
principal amount, if any, of such Note that remains subject to the
original Fundamental Change Repurchase Notice, which portion must
be an integral multiple of $1,000
(provided that, if the Notes are not in certificated form,
the Withdrawal Notice must comply with the Applicable
Procedures).
The Maturity Date of the Notes is March
15, 2019, unless earlier converted or repurchased pursuant
to the terms of the Indenture. If a Noteholder fails to
exercise such holder's repurchase right or its conversion right as
described in the Notice, such Noteholder's Notes will be redeemed
on the Maturity Date for a sum equal to 100% of the principal
amount of the Notes, plus any accrued and unpaid interest
thereon.
In connection with the completion of the Merger, the Company and
the Trustee entered into a supplemental indenture (the
"Supplemental Indenture") to the Indenture on April 1, 2015, providing that, at and after the
effective time of the Merger Event, the right to convert each
$1,000 principal amount of any Notes
into cash, shares of Common Stock or a combination of cash and
shares of Common Stock at the Company's election, as set forth in
Section 15.02 of the Indenture, has been changed to a right to
convert each $1,000 principal amount
of such Notes into the Reference Property (which consists solely of
cash).
Pursuant to the terms and conditions of the Indenture, the Notes
are currently convertible at the option of the Noteholders. A
Noteholder may surrender its Notes for conversion in accordance
with and subject to the terms and conditions set forth in the
Indenture. However, although the Notes are convertible, Notes
surrendered for conversion will not be eligible for the Make-Whole
Conversion Rate Adjustment unless properly surrendered during the
Make-Whole Fundamental Change Period as described below.
As of April 1, 2015, the
Conversion Rate under the Indenture is 15.1947 shares of Common
Stock per $1,000 principal amount of
Notes. Pursuant to the terms and conditions of the Indenture,
if any Noteholder elects to convert its Notes at any time from, and
including, April 1, 2015, which is
the Effective Date, until, and including, 5:00 p.m. (New York
City time) on April 29, 2015,
which is the Business Day immediately preceding the Fundamental
Change Repurchase Date (such period, the "Make-Whole Fundamental
Change Period"), the applicable Conversion Rate will be increased
by an additional 0.2053 shares of Common Stock (the "Make-Whole
Conversion Rate Adjustment") for each $1,000 principal amount of the Notes properly
converted during the Make-Whole Fundamental Change Period,
resulting in an adjusted Conversion Rate of 15.4000 shares of
Common Stock (the "Make-Whole Conversion Rate") for each
$1,000 principal amount of the Notes
properly converted during the Make-Whole Fundamental Change
Period.
Notes surrendered for conversion during the period from the
close of business on any Interest Record Date to the opening of
business on the corresponding Interest Payment Date must be
accompanied by payment of an amount equal to the interest payable
on the Notes so converted; provided, however, that no
such payment shall be required (1) if the Company has
specified a Fundamental Change Repurchase Date that is after an
Interest Record Date but on or prior to the corresponding Interest
Payment Date, (2) to the extent of any Defaulted Interest, if
any, existing at the time of conversion with respect to such Note
or (3) if the Notes are surrendered for conversion after the
close of business on the Interest Record Date immediately preceding
the Maturity Date. Therefore, pursuant to the Indenture, no
payment or adjustment will be made for accrued and unpaid interest
on any Notes converted during the Make-Whole Fundamental Change
Period.
In addition, pursuant to the Indenture, the Noteholders'
conversion right will expire at 5:00
p.m. (New York City time)
on the second Scheduled Trading Day immediately preceding the
Maturity Date. Therefore, any Noteholder that fails to
properly convert its Notes in accordance with the Indenture at or
prior to 5:00 p.m. (New York City time) on the second Scheduled
Trading Day immediately preceding the Maturity Date will no longer
be permitted to convert any such Note under the Indenture and will
only be entitled to a payment of the principal amount of such
Notes, plus any accrued and unpaid interest thereon, on the
Maturity Date.
A Noteholder may not convert any Notes with respect to which it
has already delivered a Fundamental Change Repurchase Notice unless
it has validly withdrawn such Fundamental Change Repurchase Notice
in accordance with the procedures described under "Notice of
Withdrawal" in the Notice. Notes properly surrendered for
conversion may not be withdrawn.
Noteholders should review the Notice, the Indenture and the
Supplemental Indenture carefully for additional information
relating to their Fundamental Change Repurchase Right and their
conversion right and consult with their own financial and tax
advisors. None of the Company, VPI, Valeant, the Trustee, the
Paying Agent, the Conversion Agent or any of their respective
affiliates is making any representation or recommendation to any
Noteholder as to whether such Noteholder should elect to require
the Company to repurchase its Notes or convert its Notes or whether
such Noteholder should continue to hold its Notes through the
Maturity Date.
The Trustee, U.S. Bank National Association, also serves as the
Paying Agent and the Conversion Agent under the Indenture. The
address of the Paying Agent and the Conversion Agent is U.S. Bank
National Association, Hearst Tower - 214 N. Tryon Street, 27th
Floor, Charlotte, North Carolina
28202, Attention: Corporate Trust Department.
About Valeant
Valeant Pharmaceuticals International, Inc. (NYSE/TSX: VRX) is a
multinational specialty pharmaceutical company that develops,
manufactures and markets a broad range of pharmaceutical products
primarily in the areas of dermatology, eye health, neurology, and
branded generics. More information about Valeant Pharmaceuticals
International, Inc. can be found at www.valeant.com.
Caution regarding Forward-Looking Statements and "Safe
Harbor" Statement
This press release may contain forward-looking statements.
Forward-looking statements may generally be identified by the use
of the words "anticipates," "expects," "intends," "plans,"
"should," "could," "would," "may," "will," "believes," "estimates,"
"potential," "target," or "continue" and variations or similar
expressions. These statements are based upon the current
expectations and beliefs of management and are subject to certain
risks and uncertainties that could cause actual results to differ
materially from those described in the forward-looking
statements. These risks and uncertainties include, but are
not limited to, risks and uncertainties discussed in Salix's and
Valeant's most recent annual or quarterly reports and detailed from
time to time in Salix's and Valeant's other filings with the
Securities and Exchange Commission and the Canadian Securities
Administrators, which factors are incorporated herein by
reference. Readers are cautioned not to place undue reliance
on any of these forward-looking statements. These
forward-looking statements speak only as of the date of this press
release. We undertake no obligation to update any of these
forward-looking statements to reflect events or circumstances after
the date of this press release or to reflect actual outcomes,
except as required by law.
Contact Information:
Laurie W. Little
949-461-6002
laurie.little@valeant.com
Media:
Renee E. Soto/Meghan Gavigan
Sard Verbinnen & Co.
212-687-8080
rsoto@sardverb.com / mgavigan@sardverb.com
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SOURCE Valeant Pharmaceuticals International, Inc.