Safeguard Scientifics, Inc. (NYSE: SFE), a holding company that builds value in growth-stage life sciences and technology companies, today announced that it priced an offering of $50,500,000 aggregate principal amount of its convertible senior debentures due 2018 (the “Convertible Debentures”) in a private placement (the “Offering”). The Company also granted the initial purchaser of the Convertible Debentures a 30-day option to purchase up to an additional $4,500,000 aggregate principal amount of Convertible Debentures. The Company anticipates that the closing of the Offering will take place on or about November 19, 2012, subject to customary closing conditions.
The Convertible Debentures will pay interest semi-annually at a rate of 5.25% per annum and will be convertible into shares of the Company’s common stock, cash, or a combination of shares of the Company’s common stock and cash, at the Company’s election, at an initial conversion rate of 55.17 shares of the Company’s common stock per $1,000 principal amount of the Convertible Debentures, which is equivalent to an initial conversion price of approximately $18.13 per share of common stock, subject to adjustment in certain circumstances. On or after November 15, 2016, the Company may redeem all or a portion of the Convertible Debentures at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest.
The Company intends to use the net proceeds from the sale of the Convertible Debentures to repurchase all or a portion of its outstanding 10.125% convertible senior debentures due 2014 and for general corporate purposes.
Neither the Convertible Debentures nor the shares of common stock issuable upon conversion of the Convertible Debentures have been registered under the Securities Act of 1933, as amended (“Securities Act”), or the securities laws of any other jurisdiction, and may not be offered or sold in the United States or to U.S. persons absent registration or an applicable exemption from the registration requirements. The Offering will be made only to qualified institutional buyers in accordance with Rule 144A under the Securities Act.