Danimer Scientific, Inc. (NYSE: DNMR) (“Company” or “Danimer
Scientific”), a leading next generation bioplastics company focused
on the development and production of biodegradable materials, today
announced a proposed pro-rata dividend distribution of warrants
(“Dividend Warrants”) to holders of the Company’s Class A Common
Stock, par value $0.0001 per share (“Common Stock”) as of May 13,
2024 (“Record Date”). Subject to the Company’s stockholders
approving a proposal to increase the authorized number of shares of
the Company’s Common Stock under the Company’s Fourth Amended and
Restated Certificate of Incorporation at the Company’s upcoming
annual meeting of stockholders to be held on or about July 9, 2024,
the stockholders of record as of the Record Date will receive one
(1) Dividend Warrant for each three (3) shares of Common Stock held
as of the Record Date, subject to downward rounding. Holders of our
3.250% Convertible Senior Notes due 2026 (“Convertible Notes”) and
our pre-funded common stock purchase warrants dated March 25, 2024
(collectively, “other eligible recipients”) as of the Record Date
will also receive Dividend Warrants on a pass-through basis as
determined in the agreements governing such securities and the
warrant agreement governing the Dividend Warrants. The Company
expects to distribute the Dividend Warrants to stockholders and
other eligible recipients on or about July 12, 2024 (the date of
such distribution, the “Distribution Date”). In the event that the
Company’s stockholders do not approve the proposal to increase the
authorized number of shares of Common Stock, no dividend will be
issued.
After the Distribution Date, the Dividend Warrants are expected
to list and trade on the OTCQX market, separate from Danimer
Scientific’s Common Stock, which will continue to trade on the New
York Stock Exchange. The holders of the Dividend Warrants may
exercise the Dividend Warrants by using cash or, during the periods
and in the manner specified in the warrant agreement, the Company’s
outstanding Convertible Notes. The Dividend Warrants will include a
provision that provides an additional one-half share of Common
Stock to holders (“Bonus Share Fraction”) that exercise the
Dividend Warrant prior to an expiration date that will be
determined based upon certain trading criteria for the Company’s
Common Stock.
Stephen E. Croskrey, Chairman and Chief Executive Officer of
Danimer Scientific, commented, “Danimer is committed to improving
balance sheet leverage, strengthening our capital structure and
maximizing stockholder value. This distribution is the latest in a
series of actions targeted to achieve those goals. It is structured
to create a path for stockholders to capture value in a nondilutive
warrant distribution. This deleveraging process would reward
stockholders with warrants in proportion to their stockholdings and
provide the opportunity for noteholders to participate in the
transaction. This proposed transaction does not limit any other
capital markets options for Danimer.”
Details of Warrant Distribution
If the Company’s stockholders vote to approve the proposal to
increase the authorized number of shares of Common Stock,
Stockholders will receive one (1) Dividend Warrant for each three
(3) shares of Common Stock held as of the Record Date, rounded down
to the nearest whole number for any fractional Dividend Warrant. As
an example, a stockholder who owns 3,000 shares of Common Stock
would receive 1,000 Dividend Warrants, and a stockholder who owns
1,000 shares of Common Stock would receive 333 Dividend Warrants.
Each Dividend Warrant will entitle the holder to purchase, at the
holder’s sole and exclusive election, one share of Common Stock
plus, if applicable and as described below, the Bonus Share
Fraction, at an initial exercise price of $5.00 per share. Other
eligible recipients that hold Convertible Notes or pre-funded
common stock purchase warrants as of the Record Date will receive
Dividend Warrants based on the same ratio in the manner determined
by the agreements governing such securities and the warrant
agreement.
After the Distribution Date, Dividend Warrant holders may
exercise their Dividend Warrants with cash or, after July 26, 2024,
with the Company’s Convertible Notes at face value, as specified
under the terms of the warrant agreement that is expected to be
filed with the U.S. Securities and Exchange Commission (“SEC”) on
the Distribution Date. For purposes of the Exercise Price, $1,000
principal amount of Convertible Notes shall be deemed to be equal
to the aggregate Exercise Price in respect of 200 Dividend
Warrants.
Any unredeemed Dividend Warrants will expire at 5:00 p.m. on the
first anniversary of the Distribution Date (“Expiration Date”). The
Dividend Warrants will be redeemable by the Company on or after
August 1, 2024, upon twenty calendar days’ notice, from and after
the first trading day following the date in which the daily volume
weighted average price (“VWAP”) of the shares of Common Stock has
been at least equal to a specified price, initially equal to the
Exercise Price, for at least twenty trading days (whether or not
consecutive) out of thirty consecutive trading days (“Redemption
Price Condition”).
Details of Bonus Share Fraction
The Bonus Share Fraction feature referenced above would entitle
a holder of a Dividend Warrant to receive an additional one-half of
a share of Common Stock for each Dividend Warrant exercised under
certain circumstances without payment of any additional exercise
price. The right to receive the Bonus Share Fraction will expire at
5:00 p.m. New York City time on the first trading day following the
date (“Bonus Share Expiration Date”) in which the daily VWAP of the
shares of Common Stock has been at least equal to a specified
price, initially $2.00 per share, for at least twenty trading days
each falling on or after August 1, 2024 (whether or not
consecutive) out of thirty consecutive trading days (“Bonus Share
Expiration Price Condition”). Any Dividend Warrant exercised after
the Bonus Share Expiration Date will not be entitled to the Bonus
Share Fraction.
The Company will make a public announcement of the Bonus Share
Expiration Date prior to market open on the Bonus Share Expiration
Date in the case of a Bonus Share Expiration Price Condition is
met.
Other Information
A Q&A regarding this proposed warrant distribution will be
posted in the Investor Relations section of the Company’s website
under the “Resources” tab, https://ir.danimerscientific.com/.
The distribution of the Dividend Warrants has not been
registered under the Securities Act of 1933, as amended
(“Securities Act”), because the issuance of a warrant for no
consideration is not a sale or disposition of a security or
interest in a security for value pursuant to Section 2(a)(3) of the
Securities Act. The Company expects to file with the SEC a
registration statement to register the shares of Common Stock
underlying the Dividend Warrants.
B. Dyson Capital Advisors is serving as exclusive financial
advisor on the Company’s distribution of the Dividend Warrants.
Gibson, Dunn & Crutcher LLP is serving as legal advisor to
B. Dyson Capital Advisors.
Kane Kessler, P.C. is serving as legal advisor to the
Company.
About Danimer Scientific
Danimer is a pioneer in creating more sustainable, more natural
ways to make plastic products. For more than a decade, its
renewable and sustainable biopolymers have helped create plastic
products that are biodegradable and compostable and return to
nature instead of polluting our lands and waters. Danimer’s
technology can be found in a vast array of plastic end products
that people use every day. Applications for its biopolymers include
additives, aqueous coatings, fibers, filaments, films and
injection-molded articles, among others. Danimer holds more than
480 granted patents and pending patent applications in more than 20
countries for a range of manufacturing processes and biopolymer
formulations. For more information, visit
https://danimerscientific.com.
No Offer or Solicitation
This Press Release and the Q&A referenced in it shall not
constitute an offer to sell or the solicitation of an offer to buy,
nor shall there be any sale of, these securities in any state or
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such state or jurisdiction. The proposed
distribution of the Dividend Warrants is subject to and conditioned
upon the Company’s stockholders first approving a proposal to
increase the authorized number of shares of the Company’s Common
Stock under its Fourth Amended and Restated Certificate of
Incorporation at the Company’s upcoming annual meeting of
stockholders to be held on or about July 9, 2024. Subsequently, a
Form 8-A registration statement and prospectus supplement
describing the terms of the Dividend Warrants will be filed with
the Securities and Exchange Commission (“SEC”) and will be
available on the SEC's website located at http://www.sec.gov.
Holders of Common Stock and other eligible recipients should read
the prospectus supplement carefully when it is filed, including the
Risk Factors section included and incorporated by reference
therein. This press release contains a general summary of the
expected terms of the Dividend Warrants. The prospectus supplement
and the warrant agreement, when filed, will describe the terms of
the Dividend Warrants in more detail, and in the event of any
inconsistency, the warrant agreement will govern the final terms of
the Dividend Warrants. Please read the warrant agreement when it
becomes available as it will contain important information about
the terms of the Dividend Warrants.
Forward‐Looking Statements
Please note that in this press release we may use words such as
“appears,” “anticipates,” “believes,” “plans,” “expects,”
“intends,” “future,” and similar expressions which constitute
forward-looking statements within the meaning of the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include, without limitation, statements
regarding the outcome of stockholder votes on proposals at the
Company’s annual meeting of stockholders. Forward-looking
statements are made based on the Company’s expectations and beliefs
concerning future events impacting the Company and therefore
involve a number of risks and uncertainties. We caution that
forward-looking statements are not guarantees and that actual
results could differ materially from those expressed or implied in
the forward-looking statements. Potential risks and uncertainties
that could cause the actual results of operations or financial
condition of the Company to differ materially from those expressed
or implied by forward-looking statements in this release include,
but are not limited to the Company’s expectations related to the
use of proceeds from the equity offering; the overall level of
consumer demand on the Company’s products; general economic
conditions and other factors affecting consumer confidence,
preferences, and behavior; disruption and volatility in the global
currency, capital, and credit markets; the financial strength of
the Company’s customers; the Company’s ability to implement its
business strategy, including, but not limited to, its ability to
expand its production facilities and plants to meet customer demand
for its products and the timing thereof; risks relating to the
uncertainty of the projected financial information with respect to
the Company; the ability of the Company to execute and integrate
acquisitions; changes in governmental regulation, legislation or
public opinion relating to the Company’s products; the Company’s
exposure to product liability or product warranty claims and other
loss contingencies; the impact on the Company’s business,
operations and financial results from the ongoing conflicts in
Ukraine and the Middle East; the impact that global climate change
trends may have on the Company and its suppliers and customers; the
Company’s ability to protect patents, trademarks and other
intellectual property rights; any breaches of, or interruptions in,
the Company’s information systems; the ability of the Company’s
information technology systems or information security systems to
operate effectively, including as a result of security breaches,
viruses, hackers, malware, natural disasters, vendor business
interruptions or other causes; the Company’s ability to properly
maintain, protect, repair or upgrade its information technology
systems or information security systems, or problems with the
Company’s transitioning to upgraded or replacement systems; the
impact of adverse publicity about the Company and/or its brands,
including without limitation, through social media or in connection
with brand damaging events and/or public perception; fluctuations
in the price, availability and quality of raw materials and
contracted products as well as foreign currency fluctuations; the
Company’s ability to utilize potential net operating loss
carryforwards; and changes in tax laws and liabilities, tariffs,
legal, regulatory, political and economic risks. More information
on potential factors that could affect the Company’s financial
results is included from time to time in the Company’s public
reports filed with the Securities and Exchange Commission,
including the Company’s Annual Report on Form 10-K, Quarterly
Reports on Form 10-Q, and Current Reports on Form 8-K. All
forward-looking statements included in this press release are based
upon information available to the Company as of the date of this
press release and speak only as of the date hereof. The Company
assumes no obligation to update any forward-looking statements to
reflect events or circumstances after the date of this press
release.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240502770959/en/
Investors Blake Chamblee Phone: 770-337-6570
ir@danimer.com Media Richard Ivey Phone: 229-254-7688
rivey@danimer.com
Grafico Azioni Danimer Scientific (NYSE:DNMR)
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