Summary
Vertex Pharmaceuticals Incorporated (VRTX) announced in this 8-K filing dated December 2, 2005, that it entered into agreements to exchange approximately 7.34 million shares of its common stock for over $103 million in aggregate principal amount of its 5 3/4% Convertible Senior Subordinated Notes due 2011. These transactions involved existing noteholders and were structured as unregistered sales of equity securities, exempt under Section 3(a)(9) of the Securities Act of 1933. These note exchanges are expected to result in a non-cash accounting charge of approximately $10.7 million, which will be recognized in the company's year-end 2005 financial results. The charge reflects the incremental shares issued beyond what would have been issued under the original conversion terms of the notes. Vertex has also agreed to file a registration statement in December 2005 to allow for the resale of approximately 5.1 million of the shares issued in these exchanges.
Key Highlights
- 1Vertex Pharmaceuticals entered into agreements to exchange common stock for convertible senior subordinated notes.
- 2Approximately 7.34 million shares of common stock were exchanged for over $103 million in principal amount of notes.
- 3The transactions occurred on November 28, 2005, and November 30, 2005, with existing noteholders.
- 4These exchanges are considered unregistered sales of equity securities, exempt under Section 3(a)(9) of the Securities Act.
- 5Vertex expects to incur a non-cash charge of approximately $10.7 million related to these exchanges.
- 6The non-cash charge will be reported in the company's year-end 2005 financial results.
- 7Vertex agreed to file a registration statement in December 2005 for the resale of approximately 5.1 million shares.