Pharsight Preferred Stockholders Elect to Convert Preferred Shares Into Common Stock
MOUNTAIN VIEW, Calif., June 28, 2007 /PRNewswire-FirstCall/ -- Pharsight Corporation , a leading provider of software and strategic services designed to optimize clinical drug development, announced today that its preferred stockholders, Alloy Ventures, Inc. and Sprout Group, have elected to convert all outstanding shares of Pharsight's convertible preferred stock into common stock.
The preferred shares were issued in two tranches during two private investment, public entity (PIPE) transactions completed in June and September 2002. The conversion of the preferred shares eliminates the preferred shareholder quarterly dividend rights of 2% in cash or series B preferred shares.
Upon conversion of the preferred shares, the preferred shareholders will collectively receive approximately 8 million shares of restricted, unregistered common stock. As a result, Pharsight outstanding common shares will increase from approximately 20 million to approximately 28 million.
In connection with the conversion, Pharsight expects to record a non-cash accounting charge that will reduce net income attributable to common stockholders and impact earnings per share. The charge will be based, in part, on the Company's market price at the time the conversion is deemed effective. The charge would be approximately $6 million based on the closing price as of June 27, 2007.
"Our preferred shareholders' election to convert their Pharsight investment into common stock is a significant milestone," said Shawn O'Connor, chairman and chief executive officer. "We believe Sprout and Alloy's decision implies a level of confidence in the Company inspired by our financial performance and future outlook. The conversion also supports our strategy to re-obtain trading status on the Nasdaq Capital Market. We are very excited about our future."
About Pharsight Corporation
Pharsight Corporation develops and markets integrated products and services that enable pharmaceutical and biotechnology companies to achieve significant and enduring improvements in the development and use of therapeutic products. The company's goal is to help customers reduce the time, cost and risk of drug development, as well as optimize the post-approval marketing and use of pharmaceutical products. Pharsight's approach enhances the fundamental element of drug development success: strong decision-making. By adopting the Pharsight approach, customers acquire a new decision-making process with the potential to systematically improve every level and phase of their business and scientific processes. Pharsight is headquartered in Mountain View, California. Information about Pharsight is available at http://www.pharsight.com.
This press release includes forward-looking statements, including statements regarding our growth opportunities and ability to become re-listed on the Nasdaq Capital market. These forward-looking statements involve risks and uncertainties, and factors that could cause actual results to differ materially include the following: changes in the demand for Pharsight's products and services, uncertainties involved in pharmaceutical drug development, changes in government regulation of the pharmaceutical industry, changes in Pharsight's research and development focus or operating strategies, the failure to develop new products and services or to keep pace with technological changes, the failure of the market for Pharsight's products and services to develop as expected, or for new customers beyond large pharmaceutical customers, who form a large component of Pharsight's client base, to adopt Pharsight's solutions and failure to meet all the Nasdaq listing requirements and standards. Further information on potential factors that could affect actual results is included in Pharsight's Annual Report on Form 10-K, as filed with the Securities and Exchange Commission on June 27, 2007. All forward-looking statements are based on information available to Pharsight as of the date hereof, and Pharsight assumes no obligation to update such statements, whether as a result of new developments or otherwise.
Pharsight is a trademark or registered trademark of Pharsight Corporation.
CONTACT: Investors, Jennifer Beugelmans, +1-646-201-5447, or Doug Sherk,+1-415-896-6820, or Media, Jennifer Saunders, +1-646-201-5431, all of theEVC Group, for Pharsight Corporation
Web site: http://www.pharsight.com/
Ticker Symbol: (NASDAQ-OTCBB:PHST)
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Posted: June 2007