- $118.1 million, or 55%, of outstanding convertible notes due in
2026 repurchased at approximately 75% of notional value, resulting
in $51 million in total debt extinguishment
- Repurchase funded from new $67 million secured four-year term
loan maturing in June 2028 together with $21 million cash on
hand
- Credit facility includes $25 million delayed draw term loan
conditionally available to fund narsoplimab commercialization
- Transactions include no equity component, preventing
shareholder dilution, and enable additional debt reduction
Omeros Corporation (Nasdaq: OMER) today announced that it has
completed a series of strategic financial transactions, further
strengthening its balance sheet and extending the maturity profile
on a substantial portion of its debt from February 2026 to June
2028, while providing a secure source of capital to support
potential commercialization of its lectin pathway inhibitor
narsoplimab and flexibility to manage the remaining balance of 2026
convertible notes.
Today, Omeros entered into a Credit and Guaranty Agreement with
certain funds managed by Athyrium Capital Management, LP
(collectively, “Athyrium”) and certain funds managed by Highbridge
Capital Management, LLC (collectively, “Highbridge”) as lenders.
The agreement provides for a senior secured term loan facility
initially of up to $92.1 million that includes a fully funded
initial term loan of $67.1 million as well as a $25.0 million
delayed draw term loan. Omeros used the proceeds of the initial
term loan and $21.2 million of cash on hand, subject to certain
post-closing adjustments, to repurchase $118.1 million aggregate
principal amount of Omeros’ existing 5.25% Convertible Senior Notes
due February 15, 2026 (the “2026 Notes”) held by Athyrium and
Highbridge, representing a total of 55 percent of the outstanding
2026 Notes. The blended repurchase price was 74.75 percent of par
value, resulting in $51 million in total debt extinguishment. In
addition, the Company retains all potential future value of the
capped call purchased in connection with the issuance of the 2026
Convertible Notes covering all shares underlying the original 2026
Notes. Neither the initial term loan nor the delayed draw term loan
includes any equity consideration for the lenders, preventing any
shareholder dilution as a consequence of these transactions.
The $25.0 million delayed draw term loan may be drawn once in
full on or prior to June 3, 2025, conditioned on receipt of
approval from the U.S. Food and Drug Administration of narsoplimab
in hematopoietic stem cell transplant-associated thrombotic
microangiopathy (TA-TMA). Proceeds of the delayed draw term loan,
if borrowed, must be used to fund the commercialization of
narsoplimab and to pay transaction costs associated with the
delayed draw term loan. The initial term loan has no original issue
discount; the delayed draw term loan would be issued with an
original issue discount of 3.00%.
“We are pleased to partner with Athyrium and Highbridge on these
strategic transactions and we appreciate their ongoing commitment
to Omeros’ continued success,” said Gregory A. Demopulos, M.D.,
chairman and chief executive officer of Omeros. “Through these
transactions, in addition to strengthening our balance sheet
materially, we have extinguished or extended maturity on the bulk
of our debt out to mid-2028. Prior to that, we expect not only that
narsoplimab will be established in the market but that we will have
commercialized OMS906, our MASP-3 inhibitor planned to enter Phase
3 trials later this year, and that our other programs, including
OMS527 for addictions and movement disorders and our
immuno-oncology platforms, will have markedly advanced and added
substantial shareholder value. Consistent with our efforts to
protect and grow shareholder value, evidenced through our recent
programmatic accomplishments and repurchase of 8 percent of our
outstanding common shares, today’s transaction-related achievements
required no contribution of Omeros equity, further preventing
shareholder dilution.”
After effecting the repurchase of the initial $118.1 million
notional-value of 2026 Notes, $97.9 million aggregate principal
amount remains outstanding. Under the credit agreement, Omeros
retains the flexibility to repurchase additional outstanding 2026
Notes for cash in open market or privately negotiated transactions,
subject to certain limitations. Omeros also has the right, until
the earlier of November 1, 2025 and the date Omeros elects to draw
under the delayed draw term loan, to exchange up to $16.9 million
principal amount of outstanding 2026 Notes for cash and additional
term loan amounts, with the holders of such notes becoming lenders
under the agreement.
The loans accrue interest at a competitive rate of adjusted term
SOFR (with a 3.00% floor) plus 8.75% per annum, payable quarterly.
The agreement has a four-year term and a scheduled maturity date of
June 3, 2028. Omeros will be required to prepay a portion of the
loans, plus any applicable premium if, on November 1, 2025, (i)
Omeros has not previously made nor delivered notice that it expects
to make certain voluntary or mandatory prepayments of at least $20
million in aggregate and (ii) the aggregate principal amount of
then outstanding 2026 Notes that are not held by the lenders equals
or exceeds $38.5 million.
All indebtedness outstanding under the agreement is guaranteed
by certain of Omeros’ subsidiaries, other than certain foreign
subsidiaries that are not material. The indebtedness is secured by
a first-priority security interest in and lien on substantially all
tangible and intangible property of the credit parties, subject to
customary exceptions, and excluding royalty interests in OMIDRIA®
and certain related rights.
As of March 31, 2024, Omeros had $230.3 million of cash and
investments on hand available to support ongoing operations and
debt service, which should be sufficient to fund operations and
debt service into 2026.
Cantor Fitzgerald LP served as financial advisor and Covington
& Burling LLP as legal counsel to Omeros Corporation on the
transactions. King & Spalding LLP and Paul Hastings LLP acted
as legal counsel to the lenders.
The transactions described in this press release are further
described in a Current Report on Form 8-K to be filed today with
the U.S. Securities and Exchange Commission.
About Omeros Corporation
Omeros is an innovative biopharmaceutical company committed to
discovering, developing and commercializing small-molecule and
protein therapeutics for large-market and orphan indications
targeting immunologic disorders including complement-mediated
diseases, cancers, and addictive and compulsive disorders. Omeros’
lead MASP-2 inhibitor narsoplimab targets the lectin pathway of
complement and is the subject of a biologics license application
pending before FDA for the treatment of hematopoietic stem cell
transplant-associated thrombotic microangiopathy. Omeros’
long-acting MASP-2 inhibitor OMS1029 is currently in a Phase 1
multi-ascending-dose clinical trial. OMS906, Omeros’ inhibitor of
MASP-3, the key activator of the alternative pathway of complement,
is advancing toward Phase 3 clinical trials for paroxysmal
nocturnal hemoglobinuria and complement 3 glomerulopathy. Funded by
the National Institute on Drug Abuse, Omeros’ lead
phosphodiesterase 7 inhibitor OMS527 is in clinical development for
the treatment of cocaine use disorder and, in addition, is being
developed as a therapeutic for other addictions as well as for a
major complication of treatment for movement disorders. Omeros also
is advancing a broad portfolio of novel immuno-oncology programs
comprised of two cellular and three molecular platforms. For more
information about Omeros and its programs, visit
www.omeros.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934, which are
subject to the “safe harbor” created by those sections for such
statements. All statements other than statements of historical fact
are forward-looking statements, which are often indicated by terms
such as “anticipate,” “believe,” “could,” “estimate,” “expect,”
“goal,” “intend,” “likely,” “look forward to,” “may,” “objective,”
“plan,” “possible,” “potential,” “predict,” “project,” “should,”
“slate,” “target,” “will,” “would” and similar expressions and
variations thereof. Forward-looking statements, including regarding
the future regulatory status of narsoplimab, anticipated success of
our drug development programs and commercialization objectives,
forecasts of the sufficiency our capital resources, expectations
regarding uses of proceeds of loans, and the potential for future
repurchases of 2026 Notes, are based on management’s beliefs and
assumptions and on information available to management only as of
the date hereof. Omeros’ actual results could differ materially
from those anticipated in these forward-looking statements for many
reasons, including, without limitation, regulatory processes and
oversight, market factors, and the risks, uncertainties and other
factors described under the heading “Risk Factors” in Omeros’
Annual Report on Form 10-K filed with the Securities and Exchange
Commission on April 1, 2024. Given these risks, uncertainties and
other factors, you should not place undue reliance on these
forward-looking statements, and the Company assumes no obligation
to update these forward-looking statements, whether as a result of
new information, future events or otherwise, except as required by
applicable law.
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version on businesswire.com: https://www.businesswire.com/news/home/20240603889120/en/
Jennifer Cook Williams Cook Williams Communications, Inc.
Investor and Media Relations IR@omeros.com
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