JWCA acts as exchange agent for array biopharma on its $126 million convertible bond exchange

november 2017 | read press release

Transaction Background

Array BioPharma had a $132 million Convertible bond due June 2020

• Convertible was deep in-the-money, essentially acting as equity with a coupon, while being dilutive to share count

Management asked JWCA to help evaluate options to refinance the convertible in light of its objectives:

• Preserve cash

• Extend maturity with minimal or no increase in leverage

• Minimize dilution

JWCA partnered with Array BioPharma to carefully construct and run a convertible exchange process:

• Designed the private wall-cross and exchange strategy to mitigate stock price pressure and achieve attractive terms

• Assisted the team with documentation, accounting, tax review, and settlement

• Provided advice, support and analysis during the execution

Results

The Company successfully exchanged ~$126mm of convertible debt:

• Exchanged majority of existing 3.00% convertibles due 2020, thereby pushing out maturity on a sizable portion of its upcoming liability tower by 4+ years

• Kept total debt balance unchanged while reducing coupon to 2.625% from 3.00%

• Roughly doubled the conversion price from previous $7.05 conversion price in the Old Notes

• Exchanged the Old Notes at a $1 point repurchase premium, which is half the typical cost executed by big banks