Danimer Scientific, a leading bioplastics company focused on biodegradable materials, announced the completion of a pro-rata dividend distribution of warrants (“Dividend Warrants”) to holders of its Class A Common Stock as of May 13, 2024. Stockholders received one Dividend Warrant for every three shares of Common Stock held, subject to rounding. Other eligible recipients, including holders of Convertible Senior Notes and pre-funded common stock purchase warrants, also received Dividend Warrants on a pass-through basis.
For example, a stockholder with 3,000 shares received 1,000 Dividend Warrants, while one with 1,000 shares received 333 Dividend Warrants. The Dividend Warrants will trade on the OTCQX market from July 15, 2024, under the symbol “DNMRW,” separate from Danimer Scientific’s Common Stock, which continues to trade on the NYSE under “DNMR.”
Holders can exercise the Dividend Warrants using cash or the Company’s Convertible Notes. The Dividend Warrants include a provision for an additional half share of Common Stock (“Bonus Share Fraction”) if exercised before a specified date. Each Dividend Warrant allows the holder to purchase one share of Common Stock plus, if applicable, the Bonus Share Fraction at an initial exercise price of $5.00 per share.
After July 26, 2024, Dividend Warrant holders can also use the Company’s Convertible Notes at face value to exercise the warrants. Each $1,000 principal amount of Convertible Notes equals the Exercise Price of 200 Dividend Warrants. The option to use Convertible Notes will terminate on the Bonus Share Expiration Date.
The Company can redeem the Dividend Warrants after a 20-day notice, provided the average price of Common Stock meets a specified threshold for at least 20 trading days out of 30 consecutive trading days starting August 1, 2024. Unredeemed Dividend Warrants will expire on July 15, 2025.
The Bonus Share Fraction allows warrant holders to receive an extra half share of Common Stock for each Dividend Warrant exercised before the Bonus Share Expiration Date, without additional cost. This right expires once the Common Stock’s VWAP reaches a specified price for 20 trading days after August 1, 2024. The Company will announce the Bonus Share Expiration Date when this condition is met.
For more details, visit the Investor Relations section on the Company’s website. The distribution of Dividend Warrants is not registered under the Securities Act of 1933 since issuing a warrant for no consideration is not considered a sale of a security. The Company has registered the underlying Common Stock shares with the SEC.
B. Dyson Capital Advisors served as the exclusive financial advisor for the distribution, with Gibson, Dunn & Crutcher LLP and Kane Kessler, P.C. providing legal advice.
