K2M announces fundamental change for convertibles; 2036 notes putable

Chicago, Nov. 19 – K2M Group Holdings, Inc. announced that due to the closing of its merger with Stryker Corp. a fundamental change has occurred for K2M’s 3% convertible senior notes due 2025 and the 4.125% convertible senior notes due 2036.

According to a company press release, holders of the 2036 notes have the right to require K2M to repurchase the convertibles for $1,013.52 per $1,000 principal amount on Dec. 13. To exercise that right, holders must comply with section 4.02(F) of the indenture governing the 2036 notes and the applicable rules and procedures of the depositary trust company before the close of business on the business day immediately preceding the fundamental change repurchase date.

Noteholders do not have the right to require K2M to repurchase the 2025 notes as the adequate cash conversion procedures have been satisfied.

As of Nov. 9, and until but not including Dec. 13, the conversion rate of the 2036 notes has been increased to 50.0671 from 45.7603 reference property units per $1,000 principal amount. Each reference property unit consists of $27.50 in cash. Any 2036 notes that are subject to a fundamental change repurchase notice may be converted only if the fundamental change repurchase notice is withdrawn in accordance with the indenture governing the 2036 notes.

As of Nov. 9, and until and including Jan. 3, the conversion rate of the 2025 notes has been increased to 43.1735 from 35.2930 reference property units per $1,000 principal amount. Each reference property unit consists of $27.50 in cash.

K2M Group Holdings is a Leesburg, Va.-based medical device company focused on the design, development and commercialization of minimally invasive technologies to treat spinal pathologies.

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