Company: PCRX
Filing Date: 2025-02-27
Form Type: 10-K
Source: 0001396814-25-000041
Chunk: 51

Company: Pacira BioSciences, Inc.
Filing Date: 2025-02-27
Form: 10-K
Item: Item 16
Chunk 51
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 and Other Options, an entity used to separately account for the liability and equity components of convertible debt instruments that may be settled entirely or partially in cash upon conversion in a manner that reflects the issuer’s economic interest cost. The liability component of the instrument used to be valued in a manner that reflected the market interest rate for a similar nonconvertible instrument at the date of issuance. The initial carrying value of the liability component of $314.7 million was calculated using a 5.78% assumed borrowing rate. The equity component of $87.8 million, which represented the conversion option, was determined by deducting the fair value of the liability component from the par value of the 2025 Notes and was recorded in additional paid-in capital on the consolidated balance sheet at the issuance date. The equity component used to be treated as a discount on the liability component of the 2025 Notes, which was amortized over the five-year term of the 2025 Notes using the effective interest rate method. Resulting from ASU 2020-06, ASC 470-20 was revised effective January 1, 2022 which eliminated the requirement to separately account for the embedded conversion features that are not clearly and closely related to the debt, that meet the definition of a derivative and that do not qualify for the scope exception from derivative accounting and convertible debt instruments issued with substantial premiums for which the premiums were recorded as paid in capital. Effective January 1, 2022, the 2025 Notes debt discount carrying value of $64.7 million was eliminated and there was a $1.7 million increase in deferred financing costs offset by additional paid-in capital, accumulated deficit and deferred tax assets. The 2025 Notes do not contain any financial or operating covenants or any restrictions on the payment of dividends, the issuance of other indebtedness or the issuance or repurchase of securities by the Company. The 2025 Indenture contains customary events of default with respect to the 2025 Notes, including that upon certain events of default, 100% of the principal and accrued and unpaid interest on the 2025 Notes will automatically become due and payable.

Pacira BioSciences, Inc.  |  2024 Annual Report on Form 10-K  |  Page F-27

Table of ContentsPACIRA BIOSCIENCES, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Convertible Senior Notes Due 2024 Assumed from the Flexion Acquisition