Pacira Pharmaceuticals, Inc. (NASDAQ: PCRX) (the “Company”) today announced that it has priced its private offering of $110 million in aggregate principal amount of its 3.25 percent Convertible Senior Notes due 2019. The Company has also granted the initial purchasers a 30-day option to purchase up to an additional $10 million in aggregate principal amount of the notes on the same terms and conditions, solely to cover sales in excess thereof, if any. The notes will be sold only to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. The sale of the notes is expected to close on January 23, 2013, subject to customary closing conditions.
The notes will be senior unsecured obligations of the Company and will mature on February 1, 2019. The notes will bear interest at a rate of 3.25 percent per year, payable semi-annually in arrears. Upon conversion, holders will receive cash up to the principal amount of the notes and, with respect to any excess conversion value, cash, shares of the Company’s common stock, or a combination of cash and shares of the Company’s common stock, at the Company’s option. The conversion rate for the notes will initially be 40.2945 shares of common stock (subject to customary adjustments) per $1,000 principal amount, which is equivalent to an initial conversion price of approximately $24.82 per share of the Company’s common stock. The initial conversion price of the notes represents a premium of approximately 32.50 percent to the closing sale price of $18.73 per share of the Company’s common stock on The NASDAQ Global Select Market on January 16, 2013.
The Company estimates that the net proceeds from the offering will be approximately $105.7 million (or $115.3 million if the initial purchasers exercise their option to purchase additional notes in full), after deducting the initial purchasers’ discounts and commissions and the estimated offering expenses payable by the Company. Pacira intends to use approximately $30 million of the net proceeds of the offering to repay all amounts outstanding under, and to terminate, its senior secured credit facility, and the remainder of the net proceeds from the offering (including from any exercise by the initial purchasers of their option to purchase additional notes) to fund the continued commercialization of EXPAREL® and the development of additional indications for EXPAREL and for general corporate purposes.
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