Section 1.01 Entering into or Modifying a Material Definitive Agreement.
Trust deed and notes
On July 6, 2022, Cytokinetics, Incorporated (the “Company”) has issued
$540.0 million the aggregate principal amount of its 3.50% Senior Convertible Notes due 2027 (the “Notes”), which includes the exercise in full of the initial purchasers’ option to purchase up to an additional amount $90.0 million aggregate principal amount of Notes. The Notes have been issued pursuant to, and are governed by, an indenture (the “Indenture”), dated July 6, 2022between the company and US Bank Trust Company, National Associationas trustee (the “Trustee”).
The Notes are senior unsecured obligations of the Company and are (i) senior in right of payment to future indebtedness of the Company which is expressly subordinated to the Notes in right of payment; (ii) equal in right of payment with all indebtedness of the Company not so subordinated; (iii) effectively subordinated to existing and future secured indebtedness of the Company, to the extent of the value of the collateral securing such indebtedness; and (iv) structurally subordinated to all existing and future debt and other liabilities, including trade payables, and (to the extent that the Company is not a holder thereof) preferred shares, if any, of subsidiaries of the society.
The notes bear interest at the rate of 3.50% per annum, payable semi-annually in arrears on January 1st and July, 1st of each year, from January 1, 2023. The Notes will expire on July 1, 2027, unless previously converted, redeemed or redeemed. The Notes are convertible into cash, common shares of the Company or a combination of cash and common shares of the Company, at the option of the Company, based on the applicable conversion rate(s).
Holders may convert all or part of their Notes at their option only in the following circumstances: (i) during any calendar quarter (and only during such calendar quarter) beginning after the calendar quarter ending on
September 30, 2022if the last declared sale price per common share of the Company, $0.001 par value per share (the “Common Shares”), exceeds 130% of the Conversion Price for at least 20 consecutive or non-consecutive trading days during the 30 consecutive trading days ending on and including the last trading day immediately preceding calendar quarter; (ii) during the five consecutive trading days immediately following any period of 10 consecutive trading days (such period of 10 consecutive trading days, the “Measurement Period”) if the trading price by $1,000 the principal amount of the Notes on each trading day during the Valuation Period was less than 98% of the product of the last reported sale price per common share of the Company on that trading day and the conversion rate on that trading day; (iii) upon the occurrence of certain corporate events or distributions on the common shares of the Company, as described in the Deed of Trust; (iv) if the Company calls such Notes for redemption; and (v) at any time from, and including, March 1, 2027 until the close of business on the scheduled trading day immediately prior to the maturity date.
The initial conversion rate is 19.5783 shares per $1,000 principal amount of the Notes, which represents an initial conversion price of approximately $51.08 per ordinary share. The Conversion Rate and Conversion Price will be subject to customary adjustments upon the occurrence of certain events as described in the Indenture. In addition, if certain corporate events which constitute a “fundamental fundamental change” (as defined in the Indenture) occur, then the Conversion Rate will, in certain circumstances, be increased for a specified period.
The Company may not redeem the Notes at its option at any time prior to July 7, 2025. The Notes will be redeemable, in whole or in part (subject to the “Partial Redemption Limitation” (as defined in the Indenture)), at the Company’s option, at any time and from time to time, the or after July 7, 2025 and, in the case of a partial redemption, no later than the 60th scheduled trading day immediately before the maturity date, at a redemption price in cash equal to the principal amount of the Notes to be redeemed, plus accrued and unpaid interest , if any, up to but excluding the date of redemption, but only if the last declared sale price per common share of the Company exceeds 130% of the conversion price (i) each of at least 20 consecutive or non-consecutive trading days during the 30 consecutive trading days ending on the trading day immediately preceding the date on which the Company sends the relevant redemption notice; and (ii) the Trading Day immediately preceding the date on which the Company sends such notice. In addition, the call of a Security for redemption will constitute a Fundamental Change of Make-Whole in relation to this Security, in which case the conversion rate applicable to the conversion of this Security will be increased in certain circumstances if it is converted after his call. redemption. In accordance with the Partial Redemption Limitation, the Company may not elect to redeem less than all of the outstanding Bonds unless at least $75.0 million the full principal amount of the Notes is outstanding and not subject to redemption at the time the Company sends the related redemption notice.
If a “fundamental change” (as defined in the Indenture) occurs, then, subject to a limited exception for certain cash mergers, Noteholders may require the Company to redeem their Notes at a redemption fee equal to the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, up to, but excluding, the Fundamental Change Redemption Date. The definition of fundamental change includes certain business combination transactions involving the Company and certain write-off events involving . . .
Section 2.03. Creation of a Direct Financial Obligation or an Off-Balance Sheet
The disclosure set out in Section 1.01 above is incorporated by reference into this Section 2.03.
Section 3.02. Unrecorded sales of Equity securities.
The disclosure set out in Section 1.01 above is incorporated by reference into this Section 3.02. The Notes were issued to initial purchasers pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), in transactions not involving a public offering. The Notes were resold by the initial purchasers to persons whom the initial purchasers reasonably believe to be “qualified institutional purchasers”, as defined in and pursuant to Rule 144A of the Securities Act. The Company relied on these registration exemptions based in part on representations made by the original purchasers in the purchase agreement dated June 30, 2022 by and between the Company and the original purchasers.
The Notes and the common shares issuable upon conversion of the Notes, if any, have not been registered under securities law and may not be offered or sold in United States the absence of registration or an applicable exemption from registration requirements.
All common shares of the Company issuable upon conversion of the Notes will be issued pursuant to Section 3(a)(9) of the Securities Act as involving an exchange by the Company exclusively with its securityholders. Initially, a maximum of 13,743,918 ordinary shares of the Company may be issued upon conversion of the Bonds and based on the initial maximum conversion rate of 25.4517 ordinary shares per $1,000 principal amount of the Notes, which is subject to customary anti-dilution adjustment provisions.
The 8,071,343 common shares issued on the exchange pursuant to the redemption of the 2026 Notes are issued based on the exemption from registration requirements provided by Section 4(a)(2) of the Securities Act .
Item 8.01. Other Events.
On June 29, 2022, the Company has issued a press release announcing the launch of the Notes offering. On July 1, 2022, the Company has issued a press release announcing the offer price of the Notes. Copies of the press releases are filed as Exhibits 99.1 and 99.2, respectively, to this Current Report on Form 8-K and are incorporated herein by reference.
This Current Report on Form 8-K includes forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding the offering of the Notes, the potential effects of redemptions of the 2026 Notes and statements regarding the use of proceeds of the offering. Forward-looking statements represent the Company’s current expectations regarding future events and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those implied by the forward-looking statements. Among these risks and uncertainties are market conditions, the satisfaction of closing conditions relating to the offer and risks relating to the business of the Company, including those described under “Risk Factors” and elsewhere in the filings. by the Company to the SECONDincluding in its quarterly report on Form 10-Q for the period ended March 31, 2022filed with the SECOND on May 6, 2022and future quarterly and current reports that the Company files with the SECOND. The forward-looking statements included in this current report on Form 8-K speak only as of the date of this current report on Form 8-K, and the company does not undertake to update any statements included in this current report. on Form 8-K. for subsequent developments, except as required by law.
Item 9.01 Financial statements and supporting documents.
4.1 Indenture, dated as of July 6, 2022, between Cytokinetics,
Incorporated and U.S. Bank Trust Company, National Association, as
4.2 Form of Note, representing the Company's 3.50% Convertible Senior
Notes due 2027 (included as Exhibit A to the Indenture filed as
99.1 Press Release issued by the Company on June 29, 2022.
99.2 Press Release issued by the Company on July 1, 2022.
104 Cover page interactive data file (embedded within the inline XBRL
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