NeoGenomics Announces Proposed Public Offerings of Common Stock and Convertible Senior Notes

Rhea-AI Summary

NeoGenomics, Inc. has announced public offerings of approximately $200 million in common stock and $250 million in convertible senior notes due 2028. The offerings are not contingent on each other and are subject to market conditions. The convertible notes will bear interest and can be converted into cash or shares based on specific circumstances. Funds will be utilized for general corporate purposes and capped call transactions, with potential investments in complementary businesses. Market reactions may vary based on derivatives transactions related to these offerings.

Positive

• Proceeds from the offerings are planned for general corporate purposes and capped call transactions.
• Potential to invest in complementary businesses, which could drive future growth.

Negative

• Convertible senior notes could lead to dilution of existing shares upon conversion.
• Market fluctuations from derivative transactions could impact stock price and conversion value.

FORT MYERS, FL / ACCESSWIRE / January 5, 2021 / NeoGenomics, Inc. (NASDAQ:NEO) (the "Company"), a leading provider of cancer-focused genetics testing services and global oncology contract research services, today announced that it has commenced proposed underwritten public offerings of approximately $200,000,000 of newly issued shares of common stock (the "common stock offering") and $250,000,000 aggregate principal amount of convertible senior notes due 2028 (the "notes") (the "notes offering"). In addition, NeoGenomics expects to grant the underwriters of the offerings a 30-day option to purchase up to an additional (a) $30,000,000 of shares of its common stock at the public offering price, less underwriting discounts and commissions, and (b) $37,500,000 aggregate principal amount of the notes, less underwriting discounts and commissions and solely to cover over-allotments with respect to the notes offering. Neither the completion of the common stock offering nor the notes offering is contingent on the completion of the other. The offerings are subject to market and other conditions, and there can be no assurance as to whether or when the offerings may be completed, or as to the actual size or terms of the offerings.

The notes will be senior, unsecured obligations of NeoGenomics, bearing interest semi-annually and are expected to mature on January 15, 2028, unless earlier converted or repurchased. Prior to the close of business on the business day immediately preceding September 15, 2027, the notes will be convertible at the option of holders only in certain circumstances and during certain periods, and thereafter, the notes will be convertible at any time until the close of business on the second business day immediately preceding the maturity date, in either case into cash, shares of NeoGenomics' common stock or a combination thereof, at NeoGenomics' election. The interest rate, initial conversion rate and other terms of the notes will be determined at the time of pricing of the notes offering.

In connection with the pricing of the notes offering, NeoGenomics expects to enter into capped call transactions with one or more of the underwriters and/or their respective affiliates and/or other financial institutions (the "option counterparties"). The capped call transactions will cover, subject to anti-dilution adjustments substantially similar to those applicable to the notes, the number of shares of NeoGenomics' common stock underlying the notes sold in the notes offering. The capped call transactions are generally expected to limit potential dilution to NeoGenomics' common stock upon any conversion of the notes and/or offset some or all of any cash payments NeoGenomics is required to make in excess of the principal amount of converted notes, as the case may be, with such reduction and/or offset subject to a cap.

In connection with establishing their initial hedges of the capped call transactions, NeoGenomics has been advised that the option counterparties or their respective affiliates are expected to enter into various derivative transactions with respect to NeoGenomics' common stock concurrently with or shortly after the pricing of the notes. This activity could increase (or reduce the size of any decrease in) the market price of NeoGenomics' common stock. In addition, NeoGenomics expects that the option counterparties or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to NeoGenomics' common stock and/or purchasing or selling shares of NeoGenomics' common stock or other securities of NeoGenomics in secondary market transactions following the pricing of the notes and prior to the maturity of the notes (and are likely to do so during any observation period related to a conversion of the notes or following any repurchase or redemption of the notes). This activity could also cause or avoid an increase or a decrease in the market price of NeoGenomics' common stock or the notes, which could affect the ability of holders of the notes to convert the notes and, to the extent the activity occurs during any observation period related to a conversion of the notes, it could affect the number of shares and the value of the consideration that holders of the notes will receive upon conversion of the notes.

Holders of the notes will have the right to require NeoGenomics to repurchase all or any portion of their notes at 100% of their principal amount, plus any accrued and unpaid interest to, but excluding, the fundamental change repurchase date, upon the occurrence of certain fundamental changes.

BofA Securities, Inc., Morgan Stanley & Co. LLC, and Goldman Sachs & Co. LLC are acting as representatives of the underwriters and book-running managers for the offerings.

NeoGenomics intends to use the net proceeds from the offerings for general corporate purposes and to pay the cost of the capped call transactions described above. NeoGenomics may also use a portion of the net proceeds to acquire or invest in complementary businesses and technologies, although NeoGenomics has no present commitments or agreements to enter into any material acquisitions or investments. If the initial purchasers exercise their option to purchase additional notes, NeoGenomics expects to use a portion of the net proceeds from the sale of such additional notes to enter into additional capped call transactions with the option counterparties.

The notes offering will be made pursuant to an automatic shelf registration statement (including a prospectus) filed with the Securities Exchange Commission ("SEC") on January 5, 2021 which became effective upon filing and is available on the SEC's website at www.sec.gov. The common stock offering will be made pursuant to an automatic shelf registration statement (including a prospectus) filed with the SEC on May 20, 2019 which became effective upon filing, and a preliminary prospectus supplement related to the common stock offering has been filed with the SEC and is available on the SEC's website at www.sec.gov. Alternatively, copies of the notes offering preliminary prospectus and the common stock offering preliminary prospectus supplement and the related final prospectus and prospectus supplement, when available, may be obtained from: BofA Securities, Inc., NC1-004-03-43, 200 North College Street, 3^rd Floor, Charlotte, NC 28255-0001, Attn: Prospectus Department or email: dg.prospectus_requests@bofa.com; Morgan Stanley & Co. LLC, Attn: Prospectus Department, 180 Varick Street, 2nd Floor, New York , NY 10014; or Goldman Sachs & Co. LLC, Attention: Prospectus Department, 200 West Street, New York, New York 10282, telephone: 1-212-902-1171, facsimile: 212-902-9316 or by emailing prospectus-ny@ny.email.gs.com.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities, in any state or other 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 other jurisdiction. Any offer, if at all, will be made only by means of the prospectus for the notes offering and the prospectus supplement and the accompanying prospectus for the common stock offering .

About NeoGenomics, Inc.

NeoGenomics, Inc. specializes in cancer genetics testing and information services. The Company provides one of the most comprehensive oncology-focused testing menus in the world for physicians to help them diagnose and treat cancer. The Company's Pharma Services Division serves pharmaceutical clients in clinical trials and drug development.

Headquartered in Fort Myers, FL, NeoGenomics operates CAP accredited and CLIA certified laboratories in Fort Myers and Tampa, Florida; Aliso Viejo, Carlsbad and San Diego, California; Houston, Texas; Atlanta, Georgia; Nashville, Tennessee; and CAP accredited laboratories in Rolle, Switzerland, and Singapore. NeoGenomics serves the needs of pathologists, oncologists, academic centers, hospital systems, pharmaceutical firms, integrated service delivery networks, and managed care organizations throughout the United States, and pharmaceutical firms in Europe and Asia.

Forward Looking Statements

Certain statements contained in this press release that are not historical, including but not limited to those regarding NeoGenomics' planned offerings of common stock and convertible senior notes and anticipated use of the net proceeds, constitute forward-looking statements for purposes of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995. These forward-looking statements involve a number of risks and uncertainties that could cause actual future results to differ materially from those anticipated in the forward-looking statements. No assurance can be given that the offerings will be consummated on the terms described above or at all. Consummation of the offerings and the terms thereof are subject to numerous conditions, many of which are beyond the control of the NeoGenomics, including: the prevailing conditions in the capital markets; interest rates; and economic, political and market factors affecting trading volumes, securities prices or demand for the Company's securities. As a result, this press release should be read in conjunction with the NeoGenomics' periodic filings with the SEC and the offering documents for the notes offering and the common stock offering.

For a discussion of risks and uncertainties, which could cause actual results to differ materially from those contained in the forward-looking statements, see "Risk Factors" in the NeoGenomics' Annual Report on Form 10-K, for the most recently ended fiscal year and in its subsequent Quarterly Reports on Form 10-Q, and the notes offering preliminary prospectus and common stock offering preliminary prospectus supplement filed with the SEC on January 5, 2021.

For further information, please contact:

NeoGenomics, Inc.

Doug Brown
Chief Strategy and Corporate Development Officer
T: 239.768.0600 x2539
M: 704.236.2064
doug.brown@neogenomics.com

Charlie Eidson
Manager of Investor Relations and Manager of Strategy and Corporate Development
T: 239.768.0600 x2726
M: 952.221.8816
charlie.eidson@neogenomics.com

SOURCE: NeoGenomics, Inc.

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FAQ

What are the details of NeoGenomics' common stock offering?

NeoGenomics aims to raise approximately $200 million through a public offering of newly issued shares of common stock.

What is the purpose of NeoGenomics' convertible senior notes offering?

The convertible senior notes offering aims to raise $250 million, with proceeds used for corporate purposes and capped call transactions.

How will NeoGenomics' stock offerings affect shareholders?

The convertible notes may cause dilution of existing shares, potentially affecting shareholder value.

When are the convertible senior notes due?

The convertible senior notes are due on January 15, 2028.

Who are the underwriters for NeoGenomics' offerings?

BofA Securities, Morgan Stanley, and Goldman Sachs are acting as underwriters for the offerings.