Incyte (INCY)

On September 30, 2009, the Company sold $400.0 million aggregate principal amount of the Notes to Goldman, Sachs & Co., Morgan Stanley & Co. Incorporated and J.P. Morgan Securities Inc. (the “Initial Purchasers”) in a private placement in reliance on the exemption from registration provided by Section 4(2) of the Securities Act of 1933 (the “Securities Act”).  The purchase agreement with the Initial Purchasers also contemplated the resale of the Notes to qualified institutional buyers and two institutional accredited investors in reliance on Rule 144A under and Section 4(2) of the Securities Act. The Company relied on these exemptions from registration based in part on representations made by the Initial Purchasers.

The net proceeds from the offering, after deducting the Initial Purchasers’ discount and the estimated offering expenses payable by the Company, were approximately $387.3 million.  The Notes will be convertible into shares of Common Stock, or shares of Series A Preferred Stock in lieu of or in combination with shares of Common Stock, based on an initial conversion rate of 113.9601 shares of Common Stock per $1,000 principal amount of Notes, subject to adjustment under certain circumstances.  The information contained in Items 1.01, 2.03 and 5.03 hereof with respect to the Notes and the Series A Preferred Stock is hereby incorporated by reference.

ITEM 3.02  UNREGISTERED SALES OF EQUITY SECURITIES.

On October 10, 2007, the Company issued to Pfizer the Note, as described in Item 2.03 above. At any time prior to maturity, Pfizer may convert all or any portion of the Note into shares of common stock of the Company at a conversion price of $9.75 per share.  The conversion price of the Note will be appropriately adjusted for stock splits, stock dividends or combinations.

The Note and any shares of common stock of the Company issued upon conversion of the Note (the “Shares”) that may be issued to Pfizer will be issued in reliance on the exemption from the registration provisions of the Securities Act of 1933 (the “Act”) set forth in Section 4(2) promulgated thereunder relating to sales by an issuer not involving a public offering.  There was no general solicitation or general advertising of the sale of the Note or the Shares, the Company made a reasonable inquiry to determine that the Note and Shares were being acquired by an “accredited investor” as defined under the Act for investment and not distribution and, prior to the execution of the Note Purchase Agreement, the Company disclosed that the notes issuable thereunder and the Shares have not been registered under the Act and may not be resold unless they are registered or an exemption from such registration is available.

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Item 3.02               Unregistered Sales of Equity Securities.

On September 26, 2006, the Company sold $151.8 million aggregate principal amount of the Notes to the Initial Purchaser, including the exercise in full of the Initial Purchaser’s option, in a private placement pursuant to exemptions from the registration requirements of the Securities Act.  The net proceeds from the offering, after deducting the estimated offering expenses payable by the Company, were approximately $110.9 million.  The Notes will be convertible into shares of Common Stock based on an initial conversion rate of 89.1385 shares of Common Stock per $1,000 principal amount of Notes (which is equal to an initial conversion price of approximately $11.22 per share), subject to adjustment under certain circumstances.  The information contained in Items 1.01 and 2.03 with respect to the Notes is hereby incorporated by reference.

The Company offered and sold the Notes to the Initial Purchaser in reliance on the exemption from registration provided by Section 4(2) of the Securities Act. The Initial Purchaser then sold the Notes to qualified institutional buyers pursuant to the exemption from registration provided by Rule 144A under the Securities Act. The Company relied on these exemptions from registration based in part on representations made by the Initial Purchaser in the purchase agreement.

ITEM 3.02  UNREGISTERED SALES OF EQUITY SECURITIES.

In connection with the License Agreement discussed in Item 1.01 above, on November 18, 2005, Incyte also entered into a Note Purchase Agreement pursuant to which it agreed to sell to Pfizer OP up to $20 million of convertible subordinated notes subject to certain conditions described in Item 2.03 above.  On February 3, 2006, Incyte issued to Pfizer OP the February Note, as described in Item 2.03 above. At any time prior to maturity, Pfizer OP may convert all or any portion of outstanding Notes into shares of common stock of Incyte at a conversion price representing a premium to Incyte’s common stock price immediately preceding the issuance of the applicable Note.  The initial conversion price for the February Note is $6.8423 per share.  The conversion prices of the Notes will be appropriately adjusted for stock splits, stock dividends or combinations.

The Notes and any shares of common stock of Incyte issued upon conversion of the Notes (the “Shares”) that may be issued to Pfizer OP will be issued in reliance on the exemption from the registration provisions of the Securities Act of 1933 (the “Act”) set forth in Section 4(2) promulgated thereunder relating to sales by an issuer not involving a public offering.  There was no general solicitation or general advertising of the sale of the Notes or the Shares, Incyte made a reasonable inquiry to determine that the Notes and Shares were being acquired by an “accredited investor” as defined under the Act for investment and not distribution and, prior to the execution of the Note Purchase Agreement, Incyte disclosed that the Notes and the Shares have not been registered under the Act and may not be resold unless they are registered or an exemption from such registration is available.  Any Notes or Shares issued pursuant to the Note Purchase Agreement will bear appropriate restrictive legends.

ITEM 3.02  UNREGISTERED SALES OF EQUITY SECURITIES.

In connection with the License Agreement discussed in Item 1.01 above, on November 18, 2005, Incyte also entered into a Note Purchase Agreement pursuant to which it agreed to sell to Pfizer OP up to $20 million of convertible subordinated notes subject to certain conditions described in Item 2.03 above.  At any time prior to maturity, Pfizer OP may convert all or any portion of outstanding Notes into shares of common stock of Incyte at a conversion price representing a premium to Incyte’s common stock price immediately preceding the issuance of the applicable Note.  The conversion price will be appropriately adjusted for stock splits, stock dividends or combinations.

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