Item 1.01 Entry into a Material Definitive Agreement.
Supplemental Indentures
In connection with the closing of the Merger, the Company and Wells Fargo Bank,
N.A., as trustee (the "Trustee") entered into (i) a Supplemental Indenture,
dated as of January 6, 2020 (the "2022 Supplemental Indenture"), to the
indenture, dated as of January 13, 2015 (the "2022 Indenture"), between the
Company and the Trustee, relating to the Company's outstanding 2.50% Convertible
Senior Notes due 2022 (the "2022 Convertible Notes"), (ii) a Supplemental
Indenture, dated as of January 6, 2020 (the "2023 Supplemental Indenture"), to
the indenture, dated as of June 10, 2016 (the "2023 Indenture"), between the
Company and the Trustee, relating to the Company's outstanding 2.75% Convertible
Senior Notes due 2023 (the "2023 Convertible Notes"), and (iii) a Supplemental
Indenture, dated as of January 6, 2020 (the "2024 Supplemental Indenture"), to
the indenture, dated as of December 18, 2018 (the "2024 Indenture" and, together
with the 2022 Indenture and the 2023 Indenture, the "Indentures"), between the
Company and the Trustee, relating to the Company's outstanding 3.50% Convertible
Senior Notes due 2024 (the "2024 Convertible Notes" and, together with the 2022
Convertible Notes and the 2023 Convertible Notes, the "Convertible Notes").
The 2022 Supplemental Indenture amends the 2022 Indenture to provide that, upon
consummation of the Merger, the right to convert the 2022 Convertible Notes into
Shares was changed to a right to convert the 2022 Convertible Notes (pursuant
to, and subject to the conditions of, the 2022 Indenture) solely into the
"Reference Property" equal to $2,539.851 (without interest) per $1,000 principal
amount of 2022 Convertible Notes.
The 2023 Supplemental Indenture amends the 2023 Indenture to provide that, upon
consummation of the Merger, the right to convert the 2023 Convertible Notes into
Shares was changed to a right to convert the 2023 Convertible Notes (pursuant
to, and subject to the conditions of, the 2023 Indenture) solely into the
"Reference Property" equal to $1,735.683 (without interest) per $1,000 principal
amount of 2023 Convertible Notes. However, if a conversion occurs on or after
the effective date of the Offer and the Merger, and on or prior to 5:00 p.m. New
York City time on the business day immediately prior to the Fundamental Change
Repurchase Date (defined below) applicable to the Offer and the Merger, pursuant
to Section 14.03 of the 2023 Indenture noteholders shall be entitled to receive,
upon conversion, $1,746.971 (without interest) per $1,000 principal amount of
2023 Convertible Notes.
The 2024 Supplemental Indenture amends the 2024 Indenture to provide that, upon
consummation of the Merger, the right to convert the 2024 Convertible Notes into
Shares was changed to a right to convert the 2024 Convertible Notes (pursuant
to, and subject to the conditions of, the 2024 Indenture) solely into the
"Reference Property" equal to $3,373.820 (without interest) per $1,000 principal
amount of 2024 Convertible Notes. However, if a conversion occurs on or after
the effective date of the Offer and the Merger, and on or prior to 5:00 p.m. New
. . .
Item 2.01 Completion of Acquisition or Disposition of Assets.
The information contained in the Introductory Note of this Current Report on
Form 8-K is incorporated by reference into this Item 2.01.
Item 2.04 Triggering Events that Accelerate or Increase a Direct Financial
Obligation or an Obligation under an Off-Balance Sheet Arrangement.
The consummation of the Merger constitutes a Share Exchange Event and the
consummation of the Offer and the Merger each constitutes a Fundamental Change
and a Make-Whole Fundamental Change (each as defined in the Indentures) under
the Indentures. The effective date of each of the Fundamental Change and the
Make-Whole Fundamental Change is January 6, 2020, the date of the consummation
of the Offer and the Merger. As a result of the Fundamental Change, each holder
of the Convertible Notes shall have the right to require the Company to
repurchase its Convertible Notes or alternatively, to surrender its Convertible
Notes for conversion. In addition, as a result of the Make-Whole Fundamental
Change, holders of the 2023 Convertible Notes and 2024 Convertible Notes who
convert their Convertible Notes at any time beginning on January 6, 2020, the
effective date of the Make-Whole Fundamental Change, and ending at 5:00 p.m.,
New York City time, on January 24, 2020, the business day immediately preceding
the Fundamental Change Repurchase Date, shall be entitled to convert their
Convertible Notes at an increased conversion rate as described below.
Pursuant to the Indentures, on January 26, 2020 (the "Fundamental Change
Repurchase Date"), each holder of the Convertible Notes has the right, at the
holder's option, to require the Company to purchase for cash all of such
holder's Convertible Notes, or any portion thereof that is a multiple of $1,000
principal amount, on the Fundamental Change Repurchase Date, in accordance with
and subject to the satisfaction by the holder of the requirements set forth in
Section 15.02 of the Indentures, at a repurchase price (the "Fundamental Change
Repurchase Price") equal to 100% of the principal amount of such Convertible
Notes, plus any accrued and unpaid interest thereon, to, but excluding, the
Fundamental Change Repurchase Date. The Fundamental Change Repurchase Price
equals approximately $1,000.764 per $1,000 principal amount of the 2022
Convertible Notes, $1,000.840 per $1,000 principal amount of the 2023
Convertible Notes and $1,001.069 per $1,000 principal amount of the 2024
Convertible Notes, in each case validly surrendered for purchase and not validly
withdrawn. In order to exercise the right to require the Company to repurchase a
holder's Convertible Notes, the holder must surrender such Convertible Notes on
or prior to 5:00 p.m., New York City time, on January 24, 2020, the business day
immediately preceding the Fundamental Change Repurchase Date.
In accordance with Section 14.07 of the Indentures and Section 2.01 of the
Supplemental Indentures, holders who surrender their Convertible Notes for
conversion from and after the effective time of the Merger at any time when the
Convertible Notes are convertible will receive cash in an amount equal to the
Conversion Rate in effect on the Conversion Date (each as defined in the
Indentures), multiplied by the Offer Price of $85.00 (less any applicable
withholding taxes), and will not receive any Shares. Because the consummation of
the Offer and the Merger each constitutes a Make-Whole Fundamental Change, the
Conversion Rate for the 2023 Convertible Notes and 2024 Convertible Notes
surrendered for conversion any time beginning on January 6, 2020, the effective
date of the Make-Whole Fundamental Change, until 5:00 p.m. New York City time on
January 24, 2020, the business day immediately preceding the Fundamental Change
Repurchase Date, will be temporarily increased to the Make-Whole Conversion Rate
. . .
Item 3.03 Material Modification to Rights of Security Holders.
The information contained in the Introductory Note, Item 2.01 and Item 5.01 of
this Current Report on Form 8-K is incorporated by reference into this Item
3.03.
Item 5.01 Changes in Control of Registrant.
As a result of the Purchaser's acceptance for payment of all Shares that were
validly tendered and not validly withdrawn in accordance with the terms of the
Offer and the consummation of the Merger pursuant to Section 251(h) of the DGCL,
on January 6, 2020, a change in control of the Company occurred and the Company
is now an indirect, wholly-owned subsidiary of Parent.
The information contained in the Introductory Note, Item 2.01, Item 5.02 and
Item 5.03 of this Current Report on Form 8-K is incorporated by reference into
this Item 5.01.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
In accordance with the terms of the Merger Agreement, and effective as of the
Effective Time, each of Alexander J. Denner, Geno J. Germano, John C. Kelly,
Clive Meanwell, Paris Panayiotopoulos, Sarah J. Schlesinger and Mark Timney
ceased to be a member from the Company's board of directors of and a member of
the committees of the Company's board of directors.
From and after the Effective Time, until the earlier of their resignation or
removal or until successors are duly elected and qualified in accordance with
applicable law, (i) Victor Bulto and Christian Klee, the directors of Purchaser
at the Effective Time, shall be the directors of the surviving corporation and
(ii) the officers of the Company at the Effective Time shall be the officers of
the surviving corporation.
Information about Victor Bulto and Christian Klee has been previously disclosed
on Schedule I of the Offer to Purchase as filed with the Tender Offer Statement
on Schedule TO filed with the SEC on December 5, 2019.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year.
In connection with the consummation of the Merger, the Company's certificate of
incorporation and its bylaws were each amended and restated in their entirety,
effective as of the Effective Time. Copies of the certificate of incorporation
and bylaws of the Company as currently in effect are filed as Exhibits 3.1 and
3.2 hereto and are incorporated by reference into this Item 5.03.
Item 8.01 Other Events.
The Company issued a notice of redemption to the holders of the 2022 Convertible
Notes on January 6, 2020, pursuant to which it will redeem the outstanding 2022
Convertible Notes for cash on February 5, 2020 (the "Redemption Date") at a
price of 100.00% of the principal amount of the 2022 Convertible Notes, plus
accrued and unpaid interest, if any (the "Redemption"). Any time prior to the
close of business on the Scheduled Trading Day (as defined in the 2022
Indenture) immediately preceding the Redemption Date, the holders of the 2022
Convertible Notes are entitled to convert such 2022 Convertible Notes as
described above.
In addition, on January 6, 2020, the Company issued a press release to provide
holders of its Convertible Notes notice of the effective date of a Make-Whole
Fundamental Change (as defined in the Indentures) as a result of the
consummation of the Offer and the Merger. The Company also delivered to all
holders of its Convertible Notes, with respect to each series, notices of the
Share Exchange Event and execution of the Supplemental Indentures, notice of the
occurrence of the effective date of the Fundamental Change and Make-Whole
Fundamental Change, and notice of the conversion and repurchase rights at the
option of the holders arising as a result thereof (such notices, the
"Fundamental Change Notices").
The information contained in the Item 1.01 of this Current Report on Form 8-K is
incorporated by reference into this Item 8.01. A copy of the notice of
redemption is attached to this Current Report on Form 8-K as Exhibit 99.1 and is
incorporated herein by reference. A copy of the press release is attached to
this Current Report on Form 8-K as Exhibit 99.2 and is incorporated herein by
reference. Copies of the Fundamental Change Notices are filed as Exhibits 99.3,
99.4 and 99.5, respectively, hereto and are incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
Number Title
2.1 Agreement and Plan of Merger, dated as of November 23, 2019, by and
among the Company, Novartis AG and Medusa Merger Corporation
(incorporated by reference to Exhibit 2.1 of the Company's Current
Report on Form 8-K filed with the SEC on November 25, 2019).
3.1 Amended and Restated Certificate of Incorporation of The Medicines
Company.
3.2 Amended and Restated Bylaws of The Medicines Company.
4.1 Supplemental Indenture, dated as of January 6, 2020, to the
indenture, dated as of January 13, 2015, between the Company and the
Trustee.
4.2 Supplemental Indenture, dated as of January 6, 2020, to the
indenture, dated as of June 10, 2016, between the Company and the
Trustee.
4.3 Supplemental Indenture, dated as of January 6, 2020, to the
indenture, dated as of December 18, 2018, between the Company and the
Trustee.
99.1 Notice of Redemption, dated January 6, 2020.
99.2 Press Release announcing Make-Whole Fundamental Change Effective
Date, dated as of January 6, 2020.
99.3 Fundamental Change Notice to Holders of 2.50% Convertible Senior
Notes due 2022, dated January 6, 2020.
99.4 Fundamental Change Notice to Holders of 2.75% Convertible Senior
Notes due 2023, dated January 6, 2020.
99.5 Fundamental Change Notice to Holders of 3.50% Convertible Senior
Notes due 2024, dated January 6, 2020.
104 Cover Page Interactive Data File (embedded with the Inline XBRL
document).
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THE MEDICINES COMPANY 
