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: September 18, 1997
INTERNEURON PHARMACEUTICALS, INC.
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(Exact name of registrant as specified in charter)
DELAWARE
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(State of other jurisdiction of incorporation)
0-18728 043047911
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(Commission File Number) (IRS Employer Identification No.)
One Ledgemont Center, 99 Hayden Avenue, Lexington, Massachusetts 02173
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(Address of principal executive offices) (Zip Code)
Registrant's telephone no. including area code: (617) 861-8444
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ITEM 5. OTHER EVENTS
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Interneuron Pharmaceuticals, Inc.(the "Company") has modified a
previously announced agreement with Swiss Bank Corporation, London Branch
("SBC"), under which the Company purchased from SBC in private transactions
capped call options on its own common stock and sold to SBC call options on its
common stock. The modified terms of the agreement are as follows.
The call options purchased by the Company, after the modification, give
the Company the right to purchase from SBC a total of 1,240,000 shares of the
Company's common stock at a strike price of $14.50. These call options are
exercisable only at their maturities, which are now December 31, 1997, June 9,
1998, September 21, 1998 and January 11, 1999, each involving 310,000 shares and
subject to caps of $22.50, $29.50, $32.50 and $34.50, respectively, which limit
the economic benefit to the Company of these call options. The call options
purchased by the Company are expected to be settled, if exercised, with cash in
an amount equal to the difference between the strike price and the market price
during a valuation period, subject to the caps.
In exchange for the modification to the call options purchased by the
Company, the Company will receive cash proceeds of $500,000 and modified the
terms of the call options sold to SBC, entitling SBC to purchase from the
Company a total of 2,000,000 shares of the Company's common stock, at a strike
price, after the modification, of $36.00 per share, 1,000,000 shares on each of
December 30, 1999 and December 31, 1999. The Company will have the right to
settle these call options with cash or stock, subject to certain conditions. If
exercised, the Company expects to settle the call options that it sold through
issuance to SBC of 2,000,000 shares of common stock, subject to the
effectiveness of a registration statement covering the resale of these shares
delivered. The sale or potential sale of such shares could have an adverse
effect on the market price of the Company's common stock.
Because the Company has the ability to settle call options through
issuance or receipt of common stock, the Company has accounted for the purchase
and sales of these call options as equivalent and offsetting noncash equity
transactions. Any gains realized from purchased call options will be reflected
in additional paid-in capital. SBC has advised Interneuron that it may engage in
transactions, including market purchases and sales of the Company's securities,
to offset its risk relating to the options. Purchases and sales could affect the
market price of the Company's common stock.
The securities sold by the Company to SBC have not been registered
under the Securities Act and may not be offered or sold in the U.S. absent
registration or an applicable exemption from registration requirements.
Except for the descriptions of historical facts contained herein, this
report contains forward-looking statements that involve risks and uncertainties,
as detailed from time to time in Interneuron's SEC filings under the Securities
Act of 1933 and the Securities Exchange Act of 1934 under "Risk Factors" and
elsewhere. Actual results could differ materially from those currently
anticipated due to a number of factors including factors that may affect the
Company's business, financial condition, and results of operations and the
market price of the Company's common stock.
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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.
INTERNEURON PHARMACEUTICALS INC.
By: /s/ Glenn L. Cooper
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Glenn L. Cooper, M.D.
President and Chief Executive Officer
Dated: September 19,1997
