8-KMaterial Agreements

REGENERON PHARMACEUTICALS, INC. 8-K Report, Material Agreement (Nov 16, 2015)

Filed November 16, 2015For Securities:REGN

Summary

Regeneron Pharmaceuticals, Inc. (REGN) has filed an 8-K report detailing a significant amendment to a warrant agreement with Credit Suisse Capital LLC. This Fourth Amendment, executed on November 15, 2015, dramatically reduces the number of outstanding warrants held by Credit Suisse, by up to 92% (approximately 476,376 warrants). This reduction is tied to Credit Suisse closing out its hedging positions related to these warrants between November 16, 2015, and February 9, 2016. Regeneron will pay an aggregate amount not exceeding $200.0 million for this warrant reduction. The company has the flexibility to satisfy these payments either in cash or by issuing shares of its common stock, subject to a cap of 250,000 shares that can be delivered in total for these settlements.

Key Highlights

  • 1Regeneron entered into a Fourth Amendment to its Warrant Agreement with Credit Suisse Capital LLC on November 15, 2015.
  • 2The amendment allows for the reduction of up to 476,376 warrants, representing approximately 92% of the remaining warrants held by Credit Suisse.
  • 3Regeneron will pay an aggregate amount not exceeding $200.0 million to Credit Suisse for the warrant reduction.
  • 4The reduction is contingent upon Credit Suisse closing out its hedging positions within a specified period (November 16, 2015, to February 9, 2016).
  • 5Regeneron has the discretion to settle these payments in cash or by issuing shares of its common stock.
  • 6There is a cap of 250,000 shares that Regeneron can deliver in total for these settlements, with provisions for shortfalls if stock settlement exceeds this cap.

Frequently Asked Questions

The primary purpose of this 8-K filing is to disclose a material definitive agreement, specifically the Fourth Amendment to Regeneron's Warrant Agreement with Credit Suisse. This amendment significantly reduces the number of outstanding warrants and outlines the terms of settlement.

The amendment allows for a substantial reduction of up to 92% in the number of outstanding warrants held by Credit Suisse, impacting approximately 476,376 warrants. This is a significant deleveraging of potential future share dilution from these specific warrants.

Regeneron will pay an aggregate amount not exceeding $200.0 million for this warrant reduction. The company can choose to pay in cash or issue shares, providing flexibility in managing its cash flow and equity structure, though share issuance is capped.

The Fourth Amendment was entered into on November 15, 2015. The period for Credit Suisse to close out its hedge positions, which determines the exact number of warrants to be reduced, runs from November 16, 2015, to no later than February 9, 2016.