J. Wood capital advisors acts as exchange agent for accuray on its $100 million convertible bond exchange and new issuance

May 2021 | read press release

Transaction Background

Accuray Incorporated (“ARAY” or the “Company”) was interested in refinancing and extending the upcoming maturity of its 2022 convertible, efficiently and without stock price risk

ARAY’s objectives were to:

• Extend the soon-to-be-current liability into a new 5-year instrument

• Avoid any negative stock price risk from a day of public marketing

• Neutralize technical selling that could impact pricing

• Simultaneously refinance its term loan and revolving credit facility

JWCA acted as exchange agent for the exchange and new issuance, providing the following support for the Company:

• Analyzed multiple potential transaction structures in preparation for different scenarios

• Designed a novel private exchange structure that included a Company repurchase of 3.1 million shares that exchanging investors would have otherwise sold into the market, eliminating stock price risk for both the Company and investors

• Advised on transaction timeline to allow for simultaneous announcement of convertible exchange and new credit facility

• Led the outreach and execution of placement and exchange with convertible investors

Results

Refinanced ~97% of upcoming $85 million maturity at attractive terms, with $2.9mm of new capital raised to facilitate liquidity, while eliminating stock price risk for both the Company and investors

Over the past year, precedent convertible issuances from sub-$1 billion market cap healthcare companies priced on average at ~3.86% coupon and ~24.8% conversion premium, with ~(19.7%) stock decline on the day of announcement

Accuray’s new convertible achieved a better coupon (3.75%) and conversion premium (30%)