8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of the earliest event reported): February 24, 2015 (February 24, 2015)

Valeant Pharmaceuticals International, Inc.

(Exact name of registrant as specified in its charter)

British Columbia, Canada	001-14956	98-0448205
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S Employer Identification No.)

2150 St. Elzéar Blvd. West

Laval, Quebec

Canada H7L 4A8

(Address of principal executive offices) (Zip Code)

(Registrant’s telephone number, including area code): (514) 744-6792

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 7.01 Regulation FD Disclosure

Valeant Pharmaceuticals International, Inc. (the “Company”) intends to amend its credit agreement (the “Credit Agreement Amendment”). In connection with the Credit Agreement Amendment, a meeting is scheduled between senior officers of the Company and its lenders to be held on February 24, 2015. In connection with these efforts, the Company will be making a slide presentation to prospective lenders (the “Lender Presentation Slides”). Certain of the Lender Presentation Slides are furnished as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.

The information in this Item 7.01, including Exhibit 99.1, is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in this Item 7.01 and Exhibit 99.1 shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit Number	Description
99.1	Lender Presentation Slides.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	VALEANT PHARMACEUTICALS INTERNATIONAL, INC.
Date: February 24, 2015	By:	/s/ Howard B. Schiller
		Howard B. Schiller Executive Vice President, Chief Financial Officer

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EXHIBIT INDEX

Exhibit Number	Description
99.1	Lender Presentation Slides.

-4-

EX-99.1

Valeant Pharmaceuticals International, Inc.

Presentation to Lenders

February 24, 2015

Exhibit 99.1

Exhibit 99.1

($ in millions)

+ / -

+ / -

12/31/2014

Net

Leverage

Subsequent

Transactions

(a)

Proposed

Transaction

Pro Forma

12/31/2014

Net

Leverage

Coupon

Libor

Floor

Maturity

Cash and Equivalents

$323

$35

$81

$438

Revolving Credit Facility ($1.5bn)

165

25

190

L+225

-

4/20/2018

Term Loan A-1 –

3

1,939

250

2,189

L+225

-

Various

New Term Loan A

--

1,000

1,000

TBD

TBD

TBD

Term

Loan

B

-

Series

C

–

E

4,509

4,509

L+275

0.75%

Various

New Term Loan B

--

4,550

4,550

TBD

TBD

TBD

Net Secured Debt

$6,291

1.4x

$12,000

2.1x

Existing Valeant Senior Notes

8,765

500

9,265

Various

-

Various

New Senior Notes

--

9,600

9,600

TBD

-

TBD

Other

13

13

-

-

-

Total Net Debt

$15,068

$30,878

5.4x

(d)

Adjusted Pro Forma EBITDA

$4,372

(b)

$267

(b)

$1,096

(c),(d)

$5,735

(d)

3.5x

Pro Forma Capital Structure

2

~5.6x Net Debt / Adjusted Pro Forma EBITDA at Close

(a)

Subsequent transactions include $1bn Bond / $250mm Term Loan issuance (January 2015), redemption of $500mm Senior Notes (January 2015), and acquisitions closed

in Q1, including Marathon and Dendreon.

(b)

Valeant’s 12/31/14 EBITDA adjusted for one-time items including restructuring costs, acquisition-related costs, impairment costs, and other one-time items. Also includes

pro forma effect for the historical results of acquisitions and divestitures consummated by the Company as if they occurred on January 1, 2014, including anticipated

synergies the Company expects to realize within 12 months of the date of the applicable acquisition. Similar adjustments for Subsequent Transactions EBITDA.

(c)

Salix 09/30/14 adjusted EBITDA plus $500mm synergies as a result of Valeant’s acquisition of Salix.

(d)

Salix adjusted EBITDA includes an addback of $27mm for R&D Milestones. Adjusted EBITDA calculations per Valeant’s credit agreement would not include the addback 

for R&D milestones. Excluding that addback, pro forma net leverage for the transaction would be 5.4x. 

Amendment Overview

3

In light of the announced acquisition, Valeant will launch an amendment to the Credit Agreement, which will:

Allow for incremental borrowing, solely for the Salix acquisition, without satisfying the 5.25x total leverage or the

3.0x minimum interest coverage ratios

Through Q1 2016 (then subsequently reverting to existing covenants):

modify the interest coverage maintenance ratio to 2.25x

allow for incurrence of additional unsecured debt of $750 million

waive the 5.25x total leverage governor in connection with any incremental borrowing

amend the definition of consolidated EBITDA to allow for add back of certain restructuring charges and

acquisition fees and expenses in connection with the Salix acquisition

Waive certain mandatory prepayments with respect to i) proceeds of equity financings used to finance a portion of

the Salix acquisition or ii) 2014 excess cash flow proceeds of ~$250 million

Modify the restricted payments covenant such that payments in connection with the refinancing of Salix’s

outstanding convertible notes and the settlement of related warrants shall not be deemed to be restricted

payments

Permit the administrative agent under the Credit Agreement to enter into certain intercreditor agreements

Increase cash netting from $350 million to $600 million

For future permitted acquisitions:

change

no

default

condition

and

pro

forma

compliance

condition

to

the

Incremental

from

‘at

closing’

to

‘at

signing’

waive incremental total leverage ratio condition so that only senior secured leverage ratio applies

Lenders will be compensated with an amendment fee of 25bps

Valeant Adjusted EBITDA Reconciliation

4

LTM Consolidated Adjusted EBITDA (As of December 31, 2014)

LTM EBITDA ($ in millions)

LTM 12/31/14

Consolidated

Net

Income

(Loss)

(a)

$708

+ Consolidated

interest

expense

(b)

896

+ Provision (benefit) for income taxes

74

+ Depreciation and amortization

1,689

+ Restructuring charges

405

+ Fees / expenses in connection with issuance of indebtedness / acquisitions

75

+ Other non-cash charges

(c)

510

LTM Consolidated Adjusted EBITDA

$4,357

+ EBITDA

and

synergies

from

prior

acquisitions

/

divestitures

(d)

15

LTM PF Consolidated Adjusted EBITDA

$4,372

+ EBITDA

and

synergies

from

subsequent

transactions

(d)

267

LTM PF Consolidated Adjusted EBITDA, including subsequent transactions

$4,639

(a)

Consolidated Net Income reflects adjustment to exclude gains and losses on asset sales, primarily facial injectables.

(b)

Net Interest expense excludes amortization and write-offs of debt discounts and debt issuance costs.

(c)

Includes impairment charges, contingent consideration fair value adjustments, amortization of inventory step up, amortization of alliance product assets & PP&E step up

and other one-time items.

(d)

Includes pro forma effect for the historical results of acquisitions and divestitures consummated by the Company as if they occurred on January 1, 2014, including

anticipated synergies the Company expects to realize within 12 months of the date of the applicable acquisition.

Salix Adjusted EBITDA Reconciliation

5

LTM Adjusted EBITDA (As of September 30, 2014)

(a)

Interest expense, net, exclusive of amortization and write-off of debt discounts and debt issuance costs.

(b)

Transaction costs associated with the acquisition of Santarus, proposed transaction with Cosmo, and Salix sale-related expenses.

(c)

Related to Uceris.

(d)

Primarily related to patents rights and upfront licenses. Adjusted EBITDA calculations per Valeant’s credit agreement would not include the addback for R&D

milestones. No R&D milestones expected in 2015.

(e)

Includes amortization and write-off of debt discounts and debt issuance costs, contingent considerations fair value adjustments, amortization of inventory step-up

and other one-time items.

LTM EBITDA ($ in millions)

LTM 09/30/14

Net Income (Loss)

($94)

+ Interest expense

(a)

116

+ Provision (benefit) for income taxes

(63)

+ Depreciation and amortization

226

+ Restructuring charges

67

+ Fees

/

expenses

in

connection

with

issuance

of

indebtedness

/

acquisitions

(b)

72

+ Sales-based milestones

(c)

23

+ R&D milestones

(d)

27

+ Other non-cash charges

(e)

222

LTM Adjusted EBITDA

$596

Note: Financials before restatement, which is expected on or before 3/2/15. Pro forma for Santarus acquisition.