UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(RULE 13d-101)
UNDER THE SECURITIES EXCHANGE ACT OF 1934
INFORMATION TO BE INCLUDED IN STATEMENTS FILED
PURSUANT TO 13d-1(a) AND AMENDMENTS
THERETO FILED PURSUANT TO 13d-2(a)
(AMENDMENT NO. ___)*
GUILFORD PHARMACEUTICALS, INC.
(Name of Issuer)
COMMON STOCK, $.01 PAR VALUE
(Title of Class of Securities)
401829106
(CUSIP Number)
with a copy to:
George A. Vandeman, Esq. Gary Olson, Esq.
Senior Vice President, Latham & Watkins
General Counsel and Secretary 633 West Fifth Street
Amgen Inc. Suite 4000
Amgen Center Los Angeles, California 90071
1840 DeHavilland Drive (213) 485-1234
Thousand Oaks, CA 91320-1789
(805) 447-1000
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
October 1, 1997
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [_].
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
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CUSIP NO. 401829106 SCHEDULE 13D PAGE 2 OF 11 PAGES
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- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Amgen Inc.
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [_]
(b) [_]
N/A
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
WC
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
5 ITEMS 2(d) or 2(e) [_]
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF 1,340,095
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
N/A
OWNED BY
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING 1,340,095
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
N/A
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,340,095
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
N/A
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
6.9%
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
CO
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
ITEM 1. SECURITY AND ISSUER.
This statement relates to the shares of Common Stock, $.01 par value
per share (the "Common Stock"), of Guilford Pharmaceuticals, Inc., a Delaware
corporation (the "Issuer"). The principal executive offices of the Issuer are
located at 6611 Tributary Street, Baltimore, Maryland 21224.
ITEM 2. IDENTITY AND BACKGROUND.
(a)-(c). This statement is being filed by Amgen Inc., a Delaware
corporation (the "Reporting Person"). The Reporting Person is a global
biotechnology company that discovers, develops, manufactures and markets human
therapeutics based upon advances in cellular and molecular biology. Its
principal offices are located at Amgen Center, 1840 DeHavilland Drive, Thousand
Oaks, California 91320-1789.
For information with respect to the identity and background of each
executive officer and director of the Reporting Person, see Schedule I attached
hereto.
(d)-(e). During the last five years, neither the Reporting Person
nor, to the best knowledge of the Reporting Person, none of the other persons
identified in Schedule I: (i) have been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors); or (ii) was a party to a
civil proceeding of a judicial or administrative body of competent jurisdiction
and as a result of such proceeding was or is subject to a judgement, decree or
final order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or finding any violation
with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
The source of the $20,000,000 used for the Reporting Person's purchase
of 640,095 shares of Common Stock (the "Shares") and a Warrant to purchase up to
700,000 shares of Common Stock, subject to customary anti-dilution protections
(the "Warrant"), was the working capital of the Reporting Person. The Reporting
Person plans to use working capital to acquire any Common Stock issued upon any
of the Warrants as described herein.
ITEM 4. PURPOSE OF TRANSACTION.
The Reporting Person acquired the Shares and the Warrant for
investment purposes pursuant to the Purchase Agreement (see Item 6 below).
Subject to the Standstill Restriction (see Item 6 below) and depending
on general market and economic conditions affecting the Issuer and other
relevant factors, the Reporting Person may purchase additional Shares or dispose
of some or all of its Shares from time to time in open market transactions,
private transactions or otherwise.
Page 3 of 10 Pages
Except as set forth herein, the Reporting Person has no present plans
or proposals with respect to any material change in the Issuer's business or
corporate structure or which relate to or would result in:
(1) the acquisition by any person of additional securities of the
Issuer, or the disposition of securities of the Issuer;
(2) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Issuer or any of its
subsidiaries;
(3) a sale or transfer of a material amount of assets of the
Issuer or any of its subsidiaries;
(4) any change in the present board of directors or management of
the Issuer, including any plans or proposals to change the number or term
of directors or to fill any existing vacancies on the board;
(5) any material change in the present capitalization or dividend
policy of the Issuer;
(6) any other material changes in the Issuer's business or
corporate structure;
(7) changes in the Issuer's charter, bylaws or instruments
corresponding thereto or other actions which may impede the acquisition of
control of the Issuer by any person;
(8) causing a class of securities of the Issuer to be delisted
from a national securities exchange or cease to be authorized to be quoted
in an inter-dealer quotation system of a registered national securities
association;
(9) a class of equity securities of the Issuer becoming eligible
for termination of registration pursuant to Section 12(g)(4) of the
Securities Exchange Act of 1934; or
(10) any action similar to any of those enumerated above.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) At the close of business on October 1, 1997, the Reporting Person
beneficially owned 1,340,095 shares of Common Stock (which includes 700,000
shares of Common Stock issuable upon exercise of the Warrant). Such shares of
Common Stock constitute approximately 6.9% of the total number of shares of
Common Stock based upon 18,700,335 shares of Common Stock outstanding as of
September 26, 1997 as set forth in the Purchase Agreement (see Item 6 below).
Page 4 of 10 Pages
(b) The Reporting Person has the sole power to vote or to direct the
vote, and the sole power to dispose or to direct the disposition of, the Shares
beneficially owned by the Reporting Person.
(c) Except as described herein, the Reporting Person has not during
the past 60 days or since the most recent filing of a SEC Schedule 13D been
involved in any transaction concerning the Issuer's Common Stock.
(d) Not applicable.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
On August 20, 1997, the Issuer entered into a Binding Term Sheet (the
"Guilford Agreement") with the Reporting Person respecting the research,
development and commercialization of the Issuer's FKBP-based neuroimmunophilin
ligand technology ("Neuroimmunophilin Technology") for all human therapeutic and
diagnostic applications. Pursuant to the terms of the Guilford Agreement, on
October 1, 1997, the Issuer and the Reporting Person entered into a Stock and
Warrant Purchase Agreement (the "Purchase Agreement") whereby the Issuer sold to
the Reporting Person 640,095 shares of Common Stock and the Warrant for an
aggregate consideration of $20 million. The Warrant is exercisable at any time
prior to October 1, 2002 at an exercise price of $35.15 per share of Common
Stock, subject to customary anti-dilution protections.
Pursuant to Section 7 of the Purchase Agreement, during the ten year
period commencing October 1, 1997, without the written consent of the Issuer,
the Reporting Person shall not directly or indirectly acquire more than 10% of
the Issuer's outstanding capital stock. (the "Standstill Restriction"). Limited
exceptions are provided in the event that any person or group acquires more than
10% of the Issuer's outstanding capital stock or if any person or group makes a
tender offer for the Issuer's capital stock.
Also, on October 1, 1997, the Issuer and the Reporting Person entered
into a Registration Rights Agreement pursuant to which the Reporting Person has
customary "demand" and "piggyback" registration rights under the Securities Act
of 1933, as amended, covering the Shares and Common Stock issuable upon exercise
of the Warrant.
The above description of the Purchase Agreement, Warrant and the
Registration Rights Agreement, as well as the description set forth in Item 4,
are summaries only and do not purport to be complete descriptions of the terms
thereof. These summaries are subject to, and are qualified in their entirety by
reference to, the detailed provisions of the Purchase Agreement, Warrant and the
Registration Rights Agreement, which are filed as Exhibits 7.1, 7.2 and 7.3
hereto, respectively.
Page 5 of 10 Pages
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
7.1 Stock and Warrant Purchase Agreement dated October 1, 1997 by and
between the Issuer and the Reporting Person.
7.2 Warrant dated October 1, 1997 by and between the Issuer and the
Reporting Person.
7.3 Registration Rights Agreement dated October 1, 1997 by and between the
Issuer and the Reporting Person.
Page 6 of 10 Pages
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
AMGEN INC.
By: /s/ George A. Vandeman
--------------------------------
Name: George A. Vandeman
Title: Senior Vice President,
General Counsel
and Secretary
Dated: October 28, 1997
Page 7 of 10 Pages
SCHEDULE I
AMGEN INC.
EXECUTIVE OFFICERS AND DIRECTORS
EXECUTIVE OFFICERS AND EMPLOYEE DIRECTORS
Name Present Business Address Present Principal Occupation Citizenship
- ---- ------------------------ ---------------------------- -----------
N. Kirby Alton Amgen Inc. Senior Vice President, Development U.S.
Amgen Center
1840 DeHavilland Drive
Thousand Oaks, CA 91320-1789
Robert S. Attiyeh Amgen Inc. Senior Vice President, Finance and U.S.
Amgen Center Corporate Development
1840 DeHavilland Drive
Thousand Oaks, CA 91320-1789
Stan Benson Amgen Inc. Senior Vice President, Sales and U.S.
Amgen Center Marketing
1840 DeHavilland Drive
Thousand Oaks, CA 91320-1789
Gordon M. Binder Amgen Inc. Chairman of the Board and Chief U.S.
Amgen Center Executive Officer
1840 DeHavilland Drive
Thousand Oaks, CA 91320-1789
Dennis M. Fenton Amgen Inc. Senior Vice President, Operations U.S.
Amgen Center
1840 DeHavilland Drive
Thousand Oaks, CA 91320-1789
Kevin W. Sharer Amgen Inc. President, Chief Operating Officer U.S.
Amgen Center and Director
1840 DeHavilland Drive
Thousand Oaks, CA 91320-1789
Lawrence M. Souza Amgen Inc. Senior Vice President, Research U.S.
Amgen Center
1840 DeHavilland Drive
Thousand Oaks, CA 91320-1789
George A. Vandeman Amgen Inc. Senior Vice President, General Counsel U.S.
Amgen Center and Secretary
1840 DeHavilland Drive
Thousand Oaks, CA 91320-1789
Page 8 of 10 Pages
NON-EMPLOYEE DIRECTORS
Name Present Business Address Present Principal Occupation Citizenship
- ---- ------------------------ ---------------------------- -----------
William K. Bowes, Jr. U.S. Venture Partners General Partner, U.S. Venture Partners U.S.
2180 Sand Hill Road, Suite 300
Menlo Park, CA 94025
Franklin P. Johnson, Jr. Asset Management Partners General Partner, Asset Management U.S.
2275 East Bayshore Road, Partners
Suite 150
Palo Alto, CA 94303
Steven Lazarus ARCH Venture Partners Managing General Partner, ARCH U.S.
135 South La Salle Street, Venture Partners, L.P.
Suite 3702
Chicago, IL 60603
Edward J. Ledder Medicine Bow River Ranch Retired Chairman of the Board and U.S.
P.O. Box 410 Chief Executive Officer, Abbott
Medicine Bow, WY 82329 Laboratories
Gilbert S. Omenn School of Public Health Dean, School of Public Health and U.S.
SC-30 Community Medicine, University of
University of Washington Washington
Seattle, WA 98195
Judith C. Pelham Mercy Health Services President and Chief Executive U.S
34605 Twelve Mile Road Officer,
Farmington Hills, MI 48331- Mercy Health Services
3221
Page 9 of 10 Pages
EXHIBIT INDEX
7.1 Stock and Warrant Purchase Agreement dated October 1, 1997 by and
between the Issuer and the Reporting Person.
7.2 Warrant Agreement dated October 1, 1997 by and between the Issuer
and the Reporting Person.
7.3 Registration Rights Agreement dated October 1, 1997 by and
between the Issuer and the Reporting Person.
Page 10 of 10 Pages
EXHIBIT 7.1
================================================================================
STOCK AND WARRANT PURCHASE AGREEMENT
BY AND BETWEEN
GUILFORD PHARMACEUTICALS INC.
AND
AMGEN INC.
Dated as of October 1, 1997
================================================================================
TABLE OF CONTENTS
-----------------
PAGE
----
SECTION 1. Definitions..................................... 1
SECTION 2. Issuance and Sale of Securities................. 3
SECTION 3. Closing......................................... 3
(a) Closing........................................ 3
(b) Documents to be Delivered...................... 3
SECTION 4. Representations and Warranties of the Company... 3
(a) Organization and Standing...................... 3
(b) Capitalization................................. 3
(c) Issuance of Shares............................. 4
(d) Authority for Agreement........................ 4
(e) Governmental Consents.......................... 5
(f) Litigation..................................... 5
(g) SEC Filings; Financial Statements.............. 5
(h) No Undisclosed Liabilities..................... 6
(i) Absence of Changes............................. 6
(j) Intellectual Property.......................... 6
(k) No Defaults.................................... 6
(l) Offerings...................................... 6
(m) Brokers........................................ 7
SECTION 5. Representations and Warranties of Buyer......... 7
(a) Investment..................................... 7
(b) Authority...................................... 7
(c) Accredited Investor............................ 7
(d) Brokers........................................ 7
SECTION 6. Closing Conditions.............................. 7
(a) Conditions to Buyer's Obligation to Close...... 7
(b) Conditions to Company's Obligation to Close.... 8
SECTION 7. Standstill...................................... 8
SECTION 8. Survival and Indemnification.................... 8
(a) Survival of Representations, Etc............... 8
(b) Indemnification................................ 9
i
SECTION 9. Miscellaneous................................... 9
(a) Legend......................................... 9
(b) Successors and Assigns......................... 9
(c) Notices........................................ 9
(d) Choice of Law.................................. 10
(e) Entire Agreement; Amendments and Waivers....... 10
(f) Counterparts................................... 11
(g) Invalidity..................................... 11
(h) Headings....................................... 11
(i) Expenses....................................... 11
(j) Specific Enforcement........................... 11
(k) Further Assurances............................. 11
TABLE OF SCHEDULES
Schedule 4(b) - Capitalization
Schedule 4(j) - Intellectual Property
ii
STOCK AND WARRANT PURCHASE AGREEMENT
------------------------------------
THIS STOCK AND WARRANT PURCHASE AGREEMENT (the "Agreement") is dated as of
---------
October 1, 1997 and entered into by and between GUILFORD PHARMACEUTICALS INC., a
Delaware corporation (the "Company") and AMGEN INC., a Delaware corporation
-------
("Buyer").
-------
RECITALS
--------
WHEREAS, the Company, GPI NIL Holdings, Inc., a Delaware corporation and
wholly-owned subsidiary of the Company, and Buyer have entered into a
collaboration with respect to the research, development and commercialization of
certain small molecule neuroimmunophilin compounds, and have executed a Binding
Term Sheet dated as of August 20, 1997 relating thereto (the "Binding Term
------------
Sheet").
WHEREAS, in connection with the foregoing, Buyer has agreed to purchase
from the Company, and the Company has agreed to sell to Buyer, (i) 640,095
shares of the Company's Common Stock (the "Shares"), and (ii) a Warrant for the
------
purchase of 700,000 Shares of Common Stock of the Company (the "Warrant," and
-------
together with the Shares, the "Securities"). The Warrant is attached hereto as
----------
Exhibit A. Subject to adjustment as set forth in the Warrant, the Warrant shall
- ---------
be exercisable for 700,000 shares of Common Stock (individually, a "Warrant
-------
Share" and collectively, the "Warrant Shares"); and
- ----- --------------
WHEREAS, Buyer and the Company desire to provide for the foregoing
purchases and sales and to establish various rights and obligations in
connection therewith;
AGREEMENT
---------
NOW, THEREFORE, in consideration of the mutual covenants and premises
contained herein and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions.
-----------
(a) As used in this Agreement, the terms below shall have the following
meanings:
"Charter Documents" shall mean the Amended and Restated Certificate of
-----------------
Incorporation and the Amended and Restated Bylaws of the Company, each as
amended to date and presently in effect.
"Closing Date" shall mean October 1, 1997.
------------
"Collateral Agreements" shall mean the Binding Term Sheet, the Warrant and
---------------------
the Registration Rights Agreement.
"Commission" shall mean the Securities and Exchange Commission.
----------
"Common Stock" shall mean the shares of the Common Stock, $.01 par value
------------
per share, of the Company.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
------------
and the rules and regulations of the Commission thereunder.
"HSR Act" shall mean the Hart-Scott-Rodino Antitrust Improvements Act of
-------
1976, as amended.
"Person" shall mean any individual, firm, corporation, partnership, limited
------
liability company, trust, unincorporated organization or other entity or a
government or agency or political subdivision thereof, and shall include any
successor (by merger or otherwise) of such Person.
"Preferred Stock" shall mean the shares of undesignated Preferred Stock,
---------------
par value $.01 per share, of the Company.
"Registration Rights Agreement" shall mean the Registration Rights
-----------------------------
Agreement to be entered into as of the date hereof by and between the Company
and Buyer.
"Securities Act" shall mean the Securities Act of 1933, as amended, and the
--------------
rules and regulations of the Commission thereunder.
"Series A Preferred Stock" shall mean the shares of the Series A Junior
------------------------
Participating Preferred Stock, par value $.01 per share, of the Company.
(b) Other Defined Terms. The following terms shall have the meanings
-------------------
defined for such terms in the Sections set forth below:
Term Section
---- -------
Binding Term Sheet Preamble
Buyer Preamble
Closing 3(a)
Company Preamble
Company SEC Reports 4(g)
Securities Recitals
Securities Purchase Price 2
Shares Recitals
Warrant Recitals
Warrant Agreement Recitals
Warrant Share Recitals
Warrant Shares Recitals
SECTION 2. Issuance and Sale of Securities.
-------------------------------
2
Upon the terms set forth herein, the Company hereby agrees to issue
and sell to Buyer, and Buyer hereby agrees to purchase the Securities for an
aggregate purchase price of $20 Million (the "Securities Purchase Price").
-------------------------
Buyer hereby subscribes for and agrees to purchase from the Company, in
immediately available funds, (i) 640,095 Shares of the Company's Common Stock
for a cash purchase price of $15 million (calculated by reference to the closing
prices of the Company's Common Stock for the 20 consecutive trading days ending
on and including August 19, 1997 amounting to $23.434 per share), and (ii) a
Warrant to purchase 700,000 shares of the Company's Common Stock for a cash
purchase price of $5 million.
SECTION 3. Closing.
-------
(a) Closing. The closing of the transactions contemplated hereby (the
-------
"Closing") will take place on the Closing Date at 9:00 a.m. local time at the
-------
offices of Latham & Watkins, 633 West Fifth Street, Los Angeles, California
90071 or at such other time or place as the parties hereto shall mutually agree.
(b) Documents to be Delivered. At the Closing, the Company shall
-------------------------
deliver to Buyer, against payment in full of the Securities Purchase Price by
wire transfer in same day funds to the account(s) the Company shall have
designated in writing at least one business day prior to the Closing Date, the
agreements, certificates and documents as set forth in Section 6.
---------
SECTION 4. Representations and Warranties of the Company.
---------------------------------------------
The Company hereby represents and warrants to Buyer as of the date
hereof as follows:
(a) Organization and Standing. The Company is a corporation duly
-------------------------
organized and validly existing under the laws of the State of Delaware and has
requisite corporate power and authority to own and lease its property, to
conduct its business as presently conducted and as proposed to be conducted by
it and to execute and deliver this Agreement and each of the Collateral
Agreements. The Company has requisite corporate power and authority to perform
and to carry out the transactions contemplated by this Agreement and each of the
Collateral Agreements. The Company is qualified to do business and in good
standing in Delaware and in each jurisdiction where it does business or owns
property except those jurisdictions where the failure to be so qualified and in
good standing would not have a material adverse effect on its business or
property. The Company has furnished to Buyer true and complete copies of the
Charter Documents.
(b) Capitalization. As of the date hereof, the authorized capital
--------------
stock of the Company consists of the following: (i) 40,000,000 shares of Common
Stock, of which 18,700,335 shares are issued and outstanding as of September 26,
1997, (ii) 4,700,000 shares of Preferred Stock, of which no shares are issued
and outstanding, and (iii) 300,000 shares of Series A Preferred Stock, of which
no shares are issued and outstanding. All of the issued and outstanding shares
of Common Stock, have been duly authorized, and are validly issued and are fully
paid and non-assessable. Except as set forth in the Company SEC Reports or on
Schedule 4(b) hereto or as provided in this Agreement, there is not, nor upon
- -------------
the consummation of the
3
transactions contemplated herein, will there be, (i) any subscription, warrant,
option, convertible security or other right (contingent or otherwise) to
purchase or acquire any shares of capital stock of the Company, (ii) any
commitment of the Company to issue any subscription, warrant, option,
convertible security or other such right or to issue or distribute to holders of
any shares of its capital stock any evidences of indebtedness or assets of the
Company, or (iii) any obligation of the Company (contingent or otherwise) to
purchase, redeem or otherwise acquire any shares of its capital stock or any
interest therein or to pay any dividend or make any other distribution in
respect thereof. Except as set forth in the Company SEC Reports or on Schedule
--------
4(b) or as provided in this Agreement, no Person is entitled to, nor upon the
- ----
consummation of the transactions contemplated herein will any Person be entitled
to, (i) any preemptive or similar right with respect to the issuance of any
capital stock of the Company, or (ii) any rights with respect to the
registration of any capital stock of the Company under the Securities Act. In
addition, as of September 26, 1997, a total of 2,892,546 shares of Common Stock
were reserved for issuance under outstanding options, warrants and exchange
rights.
(c) Issuance of Shares. The issuance, sale and delivery of the
------------------
Securities in accordance with this Agreement, and the issuance and delivery of
the Warrant Shares issuable upon exercise of the Warrant, have been duly
authorized and reserved for issuance, as the case may be, by all necessary
corporate action on the part of the Company (no consent or approval of the
stockholders of the Company being required by law, by the Charter Documents, or
the qualification criteria of the Nasdaq National Market), and the Securities
when so issued, sold and delivered against payment therefor in accordance with
the provisions of this Agreement, and the Warrant Shares issuable upon exercise
of the Warrant, when issued upon such exercise, will be (i) duly and validly
issued, fully paid and non-assessable and not subject to preemptive or any other
similar rights of the shareholders of the Company or others and free, at time of
issuance, of all restrictions on transfer subject to restrictions on transfer
resulting from applicable federal and state securities laws and (ii) free and
clear of all liens, charges, restrictions, claims and encumbrances.
(d) Authority for Agreement. The execution, delivery and performance
-----------------------
by the Company of this Agreement and each of the Collateral Agreements have been
duly authorized by all necessary corporate action, and this Agreement and each
of the Collateral Agreements have been duly executed and delivered and
constitute valid and binding obligations of the Company enforceable in
accordance with their respective terms, subject to applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws in effect relating to or affecting the rights of creditors generally and
subject, as to enforceability, to general principles of equity. Except as
disclosed in the Binding Term Sheet, the execution and delivery by the Company
of this Agreement and each of the Collateral Agreements, and the consummation by
the Company of the transactions contemplated hereby and thereby (including,
without limitation, the issuance and sale of the Securities and the Warrant
Shares), will not violate any provision of law to which the Company is subject
and will not in any material respect conflict with or result in any breach of
any of the terms, conditions or provisions of, or constitute a default under, or
result in the creation of any lien, security interest, charge or encumbrance
upon any of the properties, assets or outstanding capital stock of the Company,
the Charter Documents, or any indenture, lease, agreement or other instrument to
which the Company is a party or by which it or any of its properties is bound,
or any decree, judgment, order, statute, rule
4
or regulation applicable to the Company; provided, however, that no such
conflict, without respect to materiality, will cause any provision of this
Agreement or each of the Collateral Agreements to become invalid or
unenforceable.
(e) Governmental Consents. No consent, approval, order or
---------------------
authorization of, or registration, qualification, designation, declaration or
filing with, any governmental or regulatory authority is required on the part of
the Company in connection with the execution and delivery of this Agreement and
each of the Collateral Agreements, and the consummation of the transactions
contemplated hereby and thereby (including, without limitation, the offer,
issue, sale and delivery of the Securities and the Warrant Shares issuable upon
exercise of the Warrant), except such filings as shall have been made or
consents or approvals obtained prior to and which shall be effective on and as
of the Closing. Based in part on the representations made by Buyer in Section 5
---------
of this Agreement, the offer and sale of the Securities to Buyer will be in
compliance with applicable federal and state securities laws.
(f) Litigation. Except as set forth in the Company SEC Reports and
----------
the Binding Term Sheet, there are no material actions, suits, proceedings or
investigations, either at law or in equity, or before any commission or other
administrative authority in any United States or foreign jurisdiction, of any
kind now pending or, to the best of the Company's knowledge, threatened or
proposed involving the Company or any of its properties or assets or which
question the validity or legality of the transactions contemplated hereby, or to
the best of the Company's knowledge, against its employees or consultants with
respect to the Company's business.
(g) SEC Filings; Financial Statements.
---------------------------------
(i) The Company has filed all forms, reports and documents required
to be filed with the Commission under the Exchange Act since January 1, 1995
(collectively, the "Company SEC Reports"). The Company SEC Reports (i) were
-------------------
prepared in all material respects in accordance with the requirements of the
Exchange Act, and (ii) did not at the time they were filed (or if amended or
superseded by a filing prior to the date of this Agreement, then on the date of
such filing) contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(ii) Each of the financial statements (including, in each case, any
related notes thereto) contained in the Company SEC Reports was prepared in
accordance with generally accepted accounting principles applied on a consistent
basis throughout the periods involved (except as may be indicated in the notes
thereto), and each was complete and correct in all material respects and
presented fairly in all material respects presented the financial position of
the Company as at the respective dates thereof and the results of its operations
and cash flows for the periods indicated, except that the unaudited interim
financial statements were or are subject to normal and recurring year-end
adjustments which were not or are not expected to be material in amount.
5
(h) No Undisclosed Liabilities. The Company does not have any
--------------------------
material liabilities (absolute, accrued, contingent or otherwise) except
liabilities (i) in the aggregate adequately provided for or otherwise disclosed
in the Company's balance sheet (including any related notes thereto) for the
fiscal quarter ended June 30, 1997 included in the Company's Quarterly Report
on Form 10-Q for the fiscal quarter ended June 30, 1997 or in the Company SEC
Reports, or (ii) incurred since June 30, 1997 in the ordinary course of
business.
(i) Absence of Changes. Since June 30, 1997, there has been no
------------------
material adverse change in the financial condition, business, or assets of the
Company.
(j) Intellectual Property.
---------------------
(i) To the best of the Company's knowledge, it has done nothing to
compromise in any material respect the secrecy, confidentiality or value of any
of its trade secrets, know-how, inventions, prototypes, designs, processes or
technical data required to conduct its business as now conducted or as proposed
to be conducted. The Company will continue to take reasonable security measures
in the future, as it presently is doing, to protect the secrecy,
confidentiality, and value of all of its trade secrets, know-how, inventions,
prototypes, designs, processes, and technical data important to the conduct of
its business.
(ii) Except as set forth in the Company SEC Reports and Schedule 4(j)
hereto, the Company has not granted rights to manufacture, produce, license,
market or sell its products to any other Person and is not bound by any
agreement that affects the Company's exclusive right to develop, manufacture,
distribute, market or sell its products.
(k) No Defaults. The Company is not in default (i) under its Charter
-----------
Documents, or any indenture, mortgage, lease agreement, contract, purchase order
or other instrument to which it is a party or by which it or any of its property
is bound or affected, or (ii) with respect to any order, writ, injunction or
decree of any court of any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, which defaults, either singly or in the aggregate, would have a
material adverse effect on the Company. At the time of the Closing, to the best
knowledge of the Company, there will exist no condition, event or act which
constitutes, or which after notice, lapse of time or both would constitute, a
material default under any of the foregoing which, either singly or in the
aggregate, would have a material adverse effect on the Company.
(l) Offerings. Except as contemplated by this Agreement or as
---------
otherwise disclosed by the Company to Buyer, the Company has no current plans or
intentions, within six months from the date hereof, to issue any shares of its
capital stock or any other securities or any securities convertible or
exchangeable into shares of its capital stock or any other securities, except
for securities issuable under approved employee benefit plans.
(m) Brokers. No broker, finder or investment banker is entitled to
-------
any brokerage, finder's or other fee or commission in connection with the
transactions contemplated by this Agreement based upon arrangements made by or
on behalf of the Company.
6
SECTION 5. Representations and Warranties of Buyer.
---------------------------------------
Buyer hereby represents and warrants to the Company as of the date
hereof as follows:
(a) Investment. Buyer is acquiring the Securities, and the Warrant
----------
Shares into which the Warrants may be exercised, for its own account (and not
for the account of others) for investment and not with a view to any
distribution thereof within the meaning of the Securities Act.
(b) Authority. Buyer has requisite power and authority to execute,
---------
deliver and perform this Agreement and each of the Collateral Agreements in
accordance with their respective terms. The execution, delivery and performance
by Buyer of this Agreement and each of the Collateral Agreements have been duly
authorized by all necessary corporate action, and this Agreement and each of the
Collateral Agreements have been duly executed and delivered and constitute valid
and binding obligations of Buyer enforceable in accordance with their respective
terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws in effect relating to or
affecting the rights of creditors generally and subject, as to enforceability,
to general principles of equity. The execution and delivery by Buyer of this
Agreement and each of the Collateral Agreements, and the consummation by Buyer
of the transactions contemplated hereby and thereby, will not violate any
provision of law to which Buyer is subject and will not conflict with or result
in any breach of any of the terms, conditions or provisions of, or constitute a
default under, or result in the creation of any lien, security interest, charge
or encumbrance upon any of the properties, assets or outstanding capital stock
of Buyer, the Charter Documents, or any indenture, lease, agreement or other
instrument to which Buyer is a party or by which it or any of its properties is
bound, or any decree, judgment, order, statute, rule or regulation applicable to
Buyer. Buyer represents that it has not been organized, reorganized or
recapitalized specifically for the purpose of investing in the Company.
(c) Accredited Investor. Buyer is an Accredited Investor within the
-------------------
definition set forth in Rule 501(a) under the Securities Act.
(d) Brokers. No broker, finder or investment banker is entitled to
-------
any brokerage, finder's or other fee or commission in connection with the
transactions contemplated by this Agreement based upon arrangements made by or
on behalf of Buyer.
SECTION 6. Closing Conditions.
------------------
(a) Conditions to Buyer's Obligation to Close. The obligation of
-----------------------------------------
Buyer to consummate the transactions contemplated hereby are subject to the
satisfaction, on or prior to the Closing Date, of the delivery by the Company of
the following: (i) certificates for the Shares in such denominations as Buyer
has requested, dated the Closing Date and registered in the name of Buyer or its
nominees as specified by Buyer, (ii) the Warrant, dated the Closing Date and
registered in the name of Buyer or its nominees as specified by Buyer, (iii)
each of the Collateral Agreements, which shall have been duly authorized,
executed and delivered by the Company and
7
shall be in full force and effect, (iv) an officers' certificate certifying as
to the incumbency of the officers of the Company executing this Agreement and
the Collateral Agreements and the resolutions of the Board of Directors
authorizing the execution, delivery and performance of the Agreement and the
Collateral Agreements, (v) a Certificate of Good Standing (long-form if
available), and (vi) an opinion of Hogan & Hartson, L.L.P., counsel to the
Company, in form and substance reasonably satisfactory to Buyer, and attached
hereto as Exhibit A, with such exceptions and qualifications as are customary
and reasonable under the law of the applicable jurisdiction. In rendering such
opinion, such counsel may rely upon certificates of public officers and, as
matters of fact, upon certificates of duly authorized representatives of the
Company; provided, that copies of such certificates shall be contemporaneously
delivered to Buyer.
(b) Conditions to Company's Obligation to Close. The obligation of
-------------------------------------------
the Company to consummate the transactions contemplated hereby is subject to the
satisfaction, on or prior to the Closing Date, of the payment by Buyer of the
Securities Purchase Price as provided for in Section 2 hereof.
SECTION 7. Standstill.
----------
During the ten-year period commencing on the date hereof, without the
written consent of the Company, Buyer shall not directly or indirectly acquire
more than 10% of the Company's then outstanding capital stock. Notwithstanding
the foregoing, if any person or group (for the purposes of this Section 7,
---------
"person" and "group" shall have the respective meanings ascribed to such terms
- ------- -----
pursuant to Regulation 13D adopted by the Commission under the Exchange Act, as
in effect on the date hereof), directly or indirectly acquires more than 10% of
the Company's then outstanding capital stock, Buyer may acquire up to the same
percentage acquired by such person or group; provided, however, Buyer is not and
does not become a member of such group. If any person or group, directly or
indirectly, makes an offer to tender or exchange for the Company's capital
stock, Buyer shall be relieved of its obligations hereunder; provided, however,
that Buyer shall not be so relieved if Buyer solicits, encourages or
participates in any such offer to tender or exchange. Nothing herein shall
prohibit Buyer from making any proposal to the Company's Board of Directors.
SECTION 8. Survival and Indemnification.
----------------------------
(a) Survival of Representations, Etc. All representations and
--------------------------------
warranties contained herein shall survive the execution and delivery of this
Agreement and the Collateral Agreements and the closing of the transactions
contemplated hereby and thereby until the first anniversary of the date of this
Agreement (or until final resolution of any claim or action arising from the
untruth, inaccuracy or breach of any such representation and warranty, if notice
of such untruth, inaccuracy or breach was given prior to such first anniversary)
without regard to any investigation made by any of the parties hereto. All
statements contained in any certificate or other instrument delivered by the
Company pursuant to this Agreement and denominated as representations and
warranties shall constitute representations and warranties by the Company under
this Agreement. All agreements and covenants contained herein shall survive
indefinitely until, by their respective terms, they are no longer operative.
8
(b) Indemnification. The parties shall, with respect to the
---------------
representations, warranties, covenants and agreements made herein or in
certificates or other instruments delivered in connection therewith, indemnify,
defend and hold the non-breaching party harmless against all liability, together
with all reasonable costs and expenses related thereto (including legal and
accounting fees and expenses), arising from the untruth, inaccuracy or breach of
any such representations, warranties, covenants or agreements of the breaching
party.
SECTION 9. Miscellaneous.
-------------
(a) Legend. (i) Each certificate representing Shares sold pursuant
------
to the provisions hereof, if deemed advisable by the Company, shall bear the
following legends:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE OFFERED, SOLD
OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL SUCH
SHARES ARE REGISTERED UNDER SUCH ACT OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE COMPANY IS OBTAINED TO THE EFFECT THAT SUCH
REGISTRATION IS NOT REQUIRED."
(ii) Buyer hereby agrees not to offer, sell or otherwise transfer
the Shares in violation of the foregoing legend or applicable state and federal
securities laws.
(iii) The Company shall have no obligation to register a transfer
of the Shares on its books, unless the conditions specified in the legend in
subclause (i) above are satisfied, and the Company may instruct its transfer
agent not to register the transfer of any of the Shares unless the conditions
specified in the foregoing legend are satisfied.
(b) Successors and Assigns. This Agreement shall be binding upon and
----------------------
inure to the benefit of the parties hereto and their respective successors and
assigns, and no other Person shall have any right, benefit or obligation
hereunder.
(c) Notices. Unless otherwise provided herein, any notice, request,
-------
instruction or other document to be given hereunder by any party to the others
shall be in writing and delivered in person or by courier, or by facsimile
transmission (with receipt confirmed) or mailed by certified mail, postage
prepaid, return receipt requested (such mailed notice to be effective on the
date of such receipt is acknowledged), as follows:
9
If to the Company:
Guilford Pharmaceuticals Inc.
6611 Tributary Street
Baltimore, Maryland 21224
Attn: Corporate Secretary
Telecopy No.: (410) 631-6899
With a copy to:
Hogan & Hartson, L.L.P.
111 South Calvert Street, 16th Floor
Baltimore, Maryland 21202
Attn: Michael Silver, Esq.
Telecopy No.: (410) 539-6981
If to Buyer:
Amgen Inc.
Amgen Center
1840 DeHavilland Drive
Thousand Oaks, California 91320-1789
Attn: Corporate Secretary
Telecopy No.: (805) 499-8011
With a copy to:
Latham & Watkins
633 West Fifth Street, Suite 4000
Los Angeles, California 90071
Attn: Gary Olson, Esq.
Telecopy No.: (213) 891-8763
or to such other place and with such other copies as either party may designate
as to itself by written notice to the others.
(d) Choice of Law. This Agreement shall be construed, interpreted and
-------------
the rights of the parties determined in accordance with the laws of the State of
Delaware (excluding choice of law provisions).
(e) Entire Agreement; Amendments and Waivers. This Agreement,
----------------------------------------
together with the Collateral Agreements, constitutes the entire agreement among
the parties pertaining to the subject matter hereof and thereof and supersedes
all prior agreements, understandings, negotiations and discussions, whether oral
or written, of the parties. No supplement, modification or waiver of this
Agreement shall be binding unless executed in writing by the party to be bound
thereby. No waiver of any of the provisions of this Agreement shall be deemed
or shall
10
constitute a waiver of any other provision hereof (whether or not similar), nor
shall such waiver constitute a continuing waiver unless otherwise expressly
provided.
(f) Counterparts. This Agreement may be executed in one or more
------------
counter parts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
(g) Invalidity. In the event that any one or more of the provisions
----------
contained in this Agreement or in any other instrument referred to herein,
shall, for any reason, be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provision of this Agreement or any other such instrument.
(h) Headings. The headings of the Articles and Sections herein are
--------
inserted for convenience of reference only and are not intended to be a part of
or to affect the meaning or interpretation of this Agreement.
(i) Expenses. Each of the Company and Buyer will each be liable for
--------
its own costs and expenses incurred in connection with the negotiation,
preparation, execution and performance of this Agreement.
(j) Specific Enforcement. The Company and Buyer acknowledge and agree
--------------------
that if any of the provisions of this Agreement were not performed in accordance
with their specific terms or were otherwise breached, irreparable damage would
occur and it would be extremely impracticable and difficult to measure damages.
Accordingly, in addition to any other rights and remedies to which the parties
may be entitled by law or equity, the parties shall be entitled to an injunction
or injunctions to prevent or cure breaches of the provisions of this Agreement
and to enforce specifically the terms and provisions hereof, and the parties
expressly waive (i) the defense that a remedy in damages will be adequate and
(ii) any requirement, in an action for specific performance, for the posting of
a bond.
(k) Further Assurances. On and after the date hereof, the Company and
------------------
Buyer will take all appropriate action and execute all documents, instruments or
conveyances of any kind which may be reasonably necessary to carry out any of
the provisions hereof.
[Signature Page to follow]
11
IN WITNESS WHEREOF, the parties hereto have executed this Agreement, or have
caused this Agreement to be duly executed on their respective behalf by their
respective officers thereunto duly authorized, as of the day and year first
above written.
GUILFORD PHARMACEUTICALS INC.
By /s/ Craig R. Smith, M.D.
--------------------------------------------------
Name: Craig R. Smith, M.D.
Title: President and Chief Executive Officer
AMGEN INC.
By /s/ George A. Vandeman
--------------------------------------------------
Name: George A. Vandeman
Title: Senior Vice President, General Counsel and
Secretary
S-1
EXHIBIT 7.2
================================================================================
WARRANT
Dated as of October 1, 1997
================================================================================
TABLE OF CONTENTS
-----------------
PAGE
----
SECTION 1. Term; Exercise of Warrant...................................... 1
SECTION 2. Payment of Taxes............................................... 2
SECTION 3. Exercise Price................................................. 2
SECTION 4. Mutilated or Missing Warrant Certificates...................... 2
SECTION 5. Reservation of Warrant Shares.................................. 2
SECTION 6. Obtaining Stock Exchange Listings.............................. 3
SECTION 7. Adjustment of Exercise Price and Number of Warrant Shares
Issuable...................................................... 3
(a) Adjustment for Change in Capital Stock........................... 3
(b) Adjustment for Rights Issue...................................... 4
(c) Adjustment for Other Distributions............................... 5
(d) Fair Market Value................................................ 6
(e) When De Minimis Adjustment May Be Deferred....................... 7
(f) When No Adjustment Required...................................... 7
(g) Reorganization of Company........................................ 7
(h) Adjustment in Number of Shares of Common Stock................... 8
(i) Disputes; Fair Market Value Determination........................ 9
(j) Form of Warrant.................................................. 9
SECTION 8. Fractional Interests........................................... 9
SECTION 9. Notices to the Holder.......................................... 10
SECTION 10. Notices to Company and the Holder
SECTION 11. Supplements and Amendments.................................... 12
SECTION 12. Successors and Assignment..................................... 12
SECTION 13. Governing Law................................................. 12
SECTION 14. Benefits of This Warrant...................................... 12
SECTION 15. Counterparts.................................................. 12
i
THIS WARRANT AND THE SHARES OBTAINABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL SUCH
WARRANT OR SHARES ARE REGISTERED UNDER SUCH ACT OR AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO THE COMPANY IS OBTAINED TO THE EFFECT THAT SUCH
REGISTRATION IS NOT REQUIRED.
GUILFORD PHARMACEUTICALS INC.
WARRANT
This certifies that, for the sum of $5 million, the receipt of which
is hereby acknowledged, Amgen Inc., or its registered permitted assigns (the
"Holder") is entitled to subscribe for and purchase up to 700,000 shares
- -------
(subject to adjustment as described herein) of fully paid and nonassessable
Common Stock of Guilford Pharmaceuticals Inc., a Delaware corporation (the
"Company"), upon exercise of this Warrant and subject to the provisions and upon
- --------
the terms and conditions hereinafter set forth.
SECTION 1. Term; Exercise of Warrant. Subject to the terms of this
-------------------------
Warrant, the Holder shall have the right, which may be exercised commencing at
the opening of business on October 2, 1997 and until 5:00 p.m., Maryland time on
October 1, 2002, to receive from the Company the number of fully paid and
nonassessable Warrant Shares which the Holder may at the time be entitled to
receive on exercise of such Warrant and payment to the Company of the Exercise
Price (as defined below) then in effect for such Warrant Shares; provided,
however, that such Warrant shall be exercised in minimum increments of 100,000
shares or as proportionately adjusted for any stock splits or stock dividends or
the like. If not exercised prior to 5:00 p.m., Maryland time on October 1,
2002, this Warrant shall become void and all rights thereunder and all rights in
respect thereof shall cease as of such time.
This Warrant may be exercised upon surrender to the Company at its
office designated for such purpose (the address of which is set forth in Section
-------
10 hereof) this Warrant with the form of election to purchase duly filled in and
- --
signed, which signature shall be guaranteed by a bank or trust company having an
office or correspondent in the United States or a broker or dealer which is a
member of a registered securities exchange or the National Association of
Securities Dealers, Inc., and upon payment to the Company of the Exercise Price
(as defined in Section 3), subject to adjustment pursuant to Section 7, for the
--------- ---------
number of Warrant Shares in respect of which the Warrant is then exercised.
Payment of the aggregate Exercise Price shall be made in cash or by certified or
official bank check payable to the order of the Company.
Subject to the provisions of Section 2 hereof, upon such surrender of
---------
this Warrant and payment of the Exercise Price the Company shall issue and cause
to be delivered with all reasonable dispatch to or upon the written order of the
Holder and in such name or names as the Holder may designate, a certificate or
certificates for the number of full Warrant Shares issuable upon the exercise of
such Warrant together with cash as provided in Section 8; provided,
---------
1
however, that if any reclassification, consolidation, merger or lease or sale of
assets is proposed to be effected by the Company as described in subsection (j)
of Section 7 hereof, or a tender offer or an exchange offer for shares of Common
---------
Stock of the Company shall be made, upon such surrender of Warrant and payment
of the Exercise Price as aforesaid, the Company shall, as soon as possible, but
in any event not later than two business days thereafter, issue and cause to be
delivered the full number of Warrant Shares issuable upon the exercise of such
Warrant in the manner described in this sentence together with cash as provided
in Section 8. Such certificate or certificates shall be deemed to have been
---------
issued and any person so designated to be named therein shall be deemed to have
become a holder of record of such Warrant Shares as of the date of the surrender
of such Warrant and payment of the Exercise Price.
The Warrant shall be exercisable, at the election of the Holder,
either in full or from time to time in part (in minimum increments of 100,000
shares) and, in the event that the Warrant is exercised in respect of fewer than
all of the Warrant Shares issuable on such exercise at any time prior to the
date of expiration of the Warrant, a new Warrant will be issued and delivered
pursuant to the provisions of this Section.
All Warrants surrendered upon exercise of Warrants shall be cancelled
and disposed of by the Company. The Company shall keep copies of this Warrant
and any notices given or received hereunder available for inspection by the
Holder during normal business hours at its office.
SECTION 2. Payment of Taxes. The Company will pay all documentary
----------------
stamp taxes, if any, attributable to the initial issuance of Warrant Shares upon
the exercise of Warrants.
SECTION 3. Exercise Price. The purchase price for each share of
--------------
Common Stock deliverable upon exercise of this Warrant (the "Exercise Price") is
--------------
$35.15 per share, subject to adjustment as described in Section 7 herein.
---------
SECTION 4. Mutilated or Missing Warrant Certificates. In case the
-----------------------------------------
Warrant shall be mutilated, lost, stolen or destroyed, the Company shall issue,
in exchange and substitution for and upon cancellation of the mutilated Warrant,
or in lieu of and substitution for the Warrant lost, stolen or destroyed, a new
Warrant of like tenor and representing an equivalent number of Warrant Shares,
but only upon receipt of evidence reasonably satisfactory to the Company of such
loss, theft or destruction of such Warrant and indemnity, if requested, also
reasonably satisfactory to it.
SECTION 5. Reservation of Warrant Shares. The Company will at all
-----------------------------
times reserve and keep available, free from preemptive rights, out of the
aggregate of its authorized but unissued Common Stock or its authorized and
issued Common Stock held in its treasury, for the purpose of enabling it to
satisfy any obligation to issue Warrant Shares upon exercise of the Warrant, the
maximum number of shares of Common Stock which may then be deliverable upon the
exercise of the outstanding Warrant.
The Company or, if appointed, the transfer agent for the Common Stock
(the "Transfer Agent") and every subsequent transfer agent for any shares of the
--------------
Company's capital
2
stock issuable upon the exercise of any of the rights of purchase aforesaid will
be irrevocably authorized and directed at all times to reserve such number of
authorized shares as shall be required for such purpose. The Company will keep
a copy of this Warrant on file with the Transfer Agent and with every subsequent
transfer agent for any shares of the Company's capital stock issuable upon the
exercise of the rights of purchase represented by the Warrants. The Company
will furnish such Transfer Agent a copy of all notices of adjustments and
certificates related thereto, transmitted to each Holder pursuant to Section 9
---------
hereof.
Before taking any action which would cause an adjustment pursuant to
Section 7 hereof to reduce the Exercise Price below the then par value (if any)
- ---------
of the Warrant Shares, the Company will take any corporate action which may, in
the opinion of its counsel, be necessary in order that the Company may validly
and legally issue fully paid and nonassessable Warrant Shares at the Exercise
Price as so adjusted.
The Company covenants that all Warrant Shares which may be issued upon
exercise of this Warrant will, upon issue, be fully paid, nonassessable, free of
preemptive rights and free from all documentary stamp taxes, and liens, charges
and security interests with respect to the issue thereof.
SECTION 6. Obtaining Stock Exchange Listings. The Company will from
---------------------------------
time to time take all action which may be necessary so that the Warrant Shares,
immediately upon their issuance upon the exercise of this Warrant, will be
listed on the principal securities exchanges and automated quotation systems
within the United States of America, if any, on which other shares of Common
Stock are then listed.
SECTION 7. Adjustment of Exercise Price and Number of Warrant Shares
---------------------------------------------------------
Issuable. The Exercise Price and the number of Warrant Shares issuable upon the
- --------
exercise of the Warrant are subject to adjustment from time to time upon the
occurrence of the events enumerated in this Section 7. For purposes of this
---------
Section 7, "Common Stock" means shares now or hereafter authorized of any class
- --------- ------------
of common stock of the Company and any other stock of the Company, however
designated, that has the right (subject to any prior rights of any class or
series of preferred stock) to participate in any distribution of the assets or
earnings of the Company without limit as to per share amount.
(a) Adjustment for Change in Capital Stock.
--------------------------------------
If the Company: (i) pays a dividend or makes a distribution on its
Common Stock in shares of its Common Stock; (ii) subdivides its outstanding
shares of Common Stock into a greater number of shares; or (iii) combines its
outstanding shares of Common Stock into a smaller number of shares; then the
Exercise Price in effect immediately prior to such action shall then be adjusted
in accordance with the formula:
3
O
E'=E x -
A
Where:
E' = the adjusted Exercise Price
E = the current Exercise Price
O = the number of shares of Common Stock outstanding prior to such action
A = the number of shares of Common Stock outstanding immediately after
such action
In the case of a dividend or distribution the adjustment shall become
effective immediately after the payment date for such dividend or distribution,
or the effective date of such other corporate action including, but not limited
to, a subdivision or combination.
If after an adjustment the Holder upon exercise of the Warrant may
receive shares of two or more classes of capital stock of the Company, the
Company shall determine the allocation of the adjusted Exercise Price between
the classes of capital stock. After such allocation, the exercise privilege,
the number of shares issuable upon such exercise, and the Exercise Price of each
class of capital stock shall thereafter be subject to adjustment on terms
comparable to those applicable to Common Stock in this Section 7.
---------
Such adjustment shall be made successively whenever any event listed
above shall occur.
(b) Adjustment for Rights Issue.
---------------------------
If the Company distributes any rights, options or warrants to all
holders of its Common Stock entitling them at any time after the record date
mentioned below to purchase shares of Common Stock at a price per share less
than the Fair Market Value (as defined in Section 7(d)) per share on such record
------------
date relating to such distribution, the Exercise Price shall be adjusted in
accordance with the formula:
4
N x P
O + ------
M
E'=E x -----
O + N
where:
E' = the adjusted Exercise Price.
E = the current Exercise Price.
O = the number of shares of Common Stock outstanding on the record date.
N = the number of additional shares of Common Stock issuable upon exercise
of the rights, options or warrants offered.
P = the exercise price per share of the additional shares issuable upon
exercise of the rights, options or warrants.
M = the Fair Market Value per share of Common Stock on the record date.
The adjustment shall be made successively whenever any such rights,
options or warrants are issued and shall become effective immediately after the
record date for the determination of stockholders entitled to receive the
rights, options or warrants. If at the end of the period during which such
rights, options or warrants are exercisable, not all rights, options or warrants
shall have been exercised, the Exercise Price shall be immediately readjusted to
what it would have been if "N" in the above formula had been the number of
shares actually issued.
Notwithstanding the foregoing, if the Company distributes or issues
rights to all holders of its Common Stock pursuant to a shareholder rights plan,
then no adjustment shall be made pursuant to this Section 7(b) upon such
------------
distribution or issuance if, upon exercise of the Warrant, the Holder receives
the same type and number of unexpired rights it would have received (as adjusted
for any event described in Sections 7(a) or (g) had it exercised the Warrant,
--------------------
and been a holder of the shares of Common Stock issuable upon exercise thereof,
prior to the record date for such distribution or issuance.
(c) Adjustment for Other Distributions.
----------------------------------
If the Company distributes to all holders of its Common Stock any of
its assets (including but not limited to securities and cash), debt securities,
capital stock, or any rights or warrants to purchase assets, debt securities,
capital stock, or other securities, the Exercise Price shall be adjusted in
accordance with the formula:
5
M - F
E' = E x -----
M
where:
E' = the adjusted Exercise Price.
E = the current Exercise Price.
M = the Fair Market Value per share of Common Stock on the record date
mentioned below.
F = the Fair Market Value on the record date of the assets, debt
securities, capital stock or rights or warrants applicable to one
share of Common Stock.
The adjustment shall be made successively whenever any such
distribution is made and shall become effective immediately after the record
date for the determination of stockholders entitled to receive the distribution.
This subsection does not apply to (i) dividends, distributions,
combinations or issuances referred to in subsection (a) of this Section 7, or
---------
(ii) rights, options or warrants referred to in subsection (b) of this Section
-------
7.
(d) Fair Market Value.
-----------------
"Fair Market Value" per share of Common Stock or any other security
-----------------
(herein collectively referred to as a "Security") or for any other asset at any
--------
date shall be:
(1) if the Security is registered under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), the average of the daily Market Prices
------------
for each business day during the period commencing 30 business days before such
date and ending on the date one day prior to such date or, if the Security has
been registered under the Exchange Act for less than 30 consecutive business
days before such date, then the average of the daily Market Prices for all of
the business days before such date for which daily Market Prices are available.
If the Market Price is not determinable for at least 15 business days in such
period, the Fair Market Value of the Security shall be determined as if the
Security was not registered under the Exchange Act; or
(2) if the asset or Security is not registered under the Exchange Act,
(i) the value of the asset or Security determined in good faith by the Board of
Directors of the Company and certified in a board resolution, based on the most
recently completed arm's length transaction between the Company and a person
other than an affiliate of the Company in which such determination is necessary
and the closing of which occurs on such date or shall have occurred within the
six months preceding such date, or (ii) if no such transaction shall have
occurred on
6
such date or within such six-month period, the value of the asset or Security
determined pursuant to the procedures set forth in Section 7(i).
------------
The "Market Price" for any Security on any business day means: (i) if
------------
such Security is listed or admitted to trading on any securities exchange, the
closing price, regular way, on such day on the principal exchange on which such
Security is traded, or if no sale takes place on such day, the average of the
closing bid and asked prices on such day, (ii) if such Security is not then
listed or admitted to trading on any securities exchange, the last reported sale
price on such day, or if there is no such last reported sale price on such day,
the average of the closing bid and the asked prices on such day, as reported by
a reputable quotation source designated by the Company, or (iii) if neither
clause (i) nor (ii) is applicable, the average of the reported high bid and low
asked prices on such day, as reported by a reputable quotation service, or a
newspaper of general circulation in the Borough of Manhattan, City of New York,
customarily published on each business day, designated by the Company. If there
are no such prices on a business day, then the Market Price shall not be
determinable for such business day.
(e) When De Minimis Adjustment May Be Deferred.
------------------------------------------
No adjustment in the Exercise Price need be made unless the adjustment
would require an increase or decrease of at least 1% in the Exercise Price. Any
adjustments that are not made shall be carried forward and taken into account in
any subsequent adjustment.
All calculations under this Section shall be made to the nearest cent
or to the nearest 1/20th of a share, as the case may be.
(f) When No Adjustment Required.
---------------------------
No adjustment shall be made for a transaction referred to in
subsections (a), (b) or (c) of this Section 7 if Holder is to participate in the
---------
transaction on a basis and with notice that is fair and appropriate in light of
the basis and notice on which holders of Common Stock participate in the
transaction.
No adjustment shall be made for rights to purchase Common Stock
pursuant to a Company plan for reinvestment of dividends or interest.
No adjustment shall be made for a change in the par value of the
Common Stock.
To the extent this Warrant becomes convertible into cash, no
adjustment need be made thereafter as to the cash. Interest will not accrue on
the cash.
(g) Reorganization of Company.
-------------------------
If any reclassification of the Common Stock of the Company or any
consolidation or merger of the Company with another entity, or the sale or lease
of all or substantially all of the Company's assets to another entity shall be
effected in such a way that holders of the Common Stock of the Company shall be
entitled to receive stock, securities or assets with respect
7
to or in exchange for such Common Stock, then, as a condition precedent to such
reclassification, consolidation, merger, sale or lease, lawful and adequate
provisions shall be made whereby the Holder shall thereafter have the right to
purchase and receive upon the basis and the terms and conditions specified in
this Warrant and in lieu of the shares of Common Stock immediately theretofore
purchasable and receivable upon the exercise of the rights represented hereby,
such shares of stock, securities or assets as may be issued or payable in such
reclassification, consolidation, merger, sale or lease with respect to or in
exchange for the number of shares of Common Stock purchasable and receivable
upon the exercise of the rights represented hereby had such rights been
exercised immediately prior thereto, and in any such case appropriate provision
shall be made with respect to the rights and interests of the Holder to the end
that the provisions hereof (including without limitation provisions for
adjustments of the Exercise Price and of the number of shares of Common Stock
purchasable and receivable upon the exercise of the Warrant) shall thereafter be
applicable, as nearly as may be, in relation to any shares of stock, securities
or assets thereafter deliverable upon the exercise hereof. The Company will not
effect any such reclassification, consolidation, merger, sale or lease, unless
prior to or as soon as practicable following the consummation thereof the
successor corporation (if other than the Company) resulting from such
reclassification, consolidation or merger or the corporation purchasing or
leasing such assets shall assume by a supplemental Warrant, executed and mailed
or delivered to the Holder, the obligation to deliver to the Holder such shares
of stock, securities or assets as, in accordance with the foregoing provisions,
Holder may be entitled to purchase.
If the issuer of securities deliverable upon exercise of the
supplemental Warrant is an affiliate of the formed, surviving, transferee or
lessee corporation, that issuer shall join in the supplemental Warrant.
If this subsection (g) applies, subsections (a), (b) and (c) of this
Section 7 do not apply.
- ---------
(h) Adjustment in Number of Shares of Common Stock.
----------------------------------------------
Upon each adjustment of the Exercise Price pursuant to this Section 7,
---------
the Warrant outstanding prior to the making of the adjustment in the Exercise
Price shall thereafter evidence the right to receive upon payment of the
adjusted Exercise Price that number of shares of Common Stock (calculated to the
nearest 1/20th of a share) obtained from the following formula:
E
N' = N x -
E'
where:
N' = the adjusted number of Warrant Shares issuable upon exercise of the
Warrant by payment of the adjusted Exercise Price.
N = the number of Warrant Shares previously issuable upon exercise of the
Warrant by payment of the Exercise Price prior to adjustment.
8
E' = the adjusted Exercise Price.
E = the Exercise Price prior to adjustment.
(i) Disputes; Fair Market Value Determination.
------------------------------------------
If a dispute shall at any time arise between the Company and the
Holder with respect to any matters hereunder including adjustments to the number
of shares of Common Stock, the Exercise Price, or a determination as to Fair
Market Value provided for herein, such dispute shall be conclusively determined
by either the Holder and the Company agreeing on a single independent investment
bank of recognized national standing to resolve the dispute or, if the Holder
and the Company cannot agree on a single investment bank after an additional
seven days, each of the Holder and the Company shall appoint an independent
investment bank of recognized national standing with appropriate experience
involving companies comparable to the Company and the dispute shall be mutually
resolved by the two investment banks. If the two investment banks are not able
to reach agreement within 20 days, then they shall within five days appoint a
third independent investment bank of recognized national standing with
appropriate experience involving companies comparable to the Company and the
dispute shall be definitively resolved by such third investment bank within 20
days. Each party shall pay the costs, fees and expenses of its respective
investment bankers and the parties shall split the costs of the third investment
bank.
(j) Form of Warrant.
---------------
Irrespective of any adjustments in the Exercise Price or the number or
kind of shares purchasable upon the exercise of the Warrant, any Warrant
theretofore or thereafter issued may continue to express the same price and
number and kind of shares as are stated in the Warrant initially issuable.
SECTION 8. Fractional Interests. The Company shall not be required
--------------------
to issue fractional Warrant Shares on the exercise of the Warrant. The number
of full Warrant Shares which shall be issuable upon the exercise thereof shall
be computed on the basis of the aggregate number of Warrant Shares purchasable
on exercise of the Warrants so presented. If any fraction of a Warrant Share
would, except for the provisions of this Section 8, be issuable on the exercise
---------
of Warrant (or specified portion thereof), the Company shall pay an amount in
cash equal to the Fair Market Value on the day immediately preceding the date
the Warrant is presented for exercise, multiplied by such fraction.
SECTION 9. Notices to the Holder. Upon any adjustment of the
---------------------
Exercise Price pursuant to Section 7, the Company shall promptly thereafter (i)
---------
cause to be filed with the Secretary of the Company a certificate setting forth
the Exercise Price after such adjustment and setting forth in reasonable detail
the method of calculation and the facts upon which such calculations are based
and setting forth the number of Warrant Shares (or portion thereof) issuable
after such adjustment in the Exercise Price, upon exercise of this Warrant and
payment of the adjusted Exercise Price, and (ii) cause to be given to the Holder
written notice of such adjustments by first-class mail, postage prepaid. Where
appropriate, such notice may be given
9
in advance and included as a part of the notice required to be mailed under the
other provisions of this Section 9.
---------
In case:
(a) the Company shall authorize the issuance to all holders of shares
of Common Stock of rights, options or warrants to subscribe for or purchase
shares of Common Stock or of any other subscription rights or warrants; or
(b) the Company shall authorize the distribution to all holders of
shares of Common Stock of evidences of its indebtedness or assets (other
than cash dividends or cash distributions payable out of earnings or earned
surplus or dividends or distributions payable in shares of Common Stock);
or
(c) of any consolidation or merger to which the Company is a party and
for which approval of any shareholders of the Company is required, or of
the conveyance or transfer of all or substantially all of the properties
and assets of the Company, or of any reclassification or change of Common
Stock issuable upon exercise of the Warrant (other than a change in par
value, or from par value to no par value, or from no par value to par
value, or as a result of a subdivision or combination), or a tender offer
or exchange offer for shares of Common Stock; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company; or
(e) the Company proposes to take any action that would require an
adjustment in the Exercise Price pursuant to subsections (a), (b) or (c) of
Section 7 and if the Company does not arrange for the Holder to participate
---------
pursuant to subsection (f) of Section 7, or if the Company takes any action
---------
that would require a supplemental Warrant pursuant to subsection (g) of
Section 7;
---------
then the Company shall cause to be given to the Holder, at least 10 days prior
to the applicable record date hereinafter specified, or promptly in the case of
events for which there is no record date, by first-class mail, postage prepaid,
a written notice stating (i) the date as of which the holders of record of
shares of Common Stock to be entitled to receive any such rights, options,
warrants or distribution are to be determined, or (ii) the initial expiration
date set forth in any tender offer or exchange offer for shares of Common Stock,
or (iii) the date on which any such consolidation, merger, conveyance, transfer,
dissolution, liquidation or winding up is expected to become effective or
consummated, and the date as of which it is expected that holders of record of
shares of Common Stock shall be entitled to exchange such shares for securities
or other property, if any, deliverable upon such reclassification,
consolidation, merger, conveyance, transfer, dissolution, liquidation or winding
up; provided, however, that the Holder shall not be entitled to receive notice
prior to any public announcement thereof by the Company. The failure to give
the notice required by this Section 9 or any defect therein shall not affect the
---------
legality or validity of any distribution, right, option, warrant, consolidation,
merger, conveyance, transfer, dissolution, liquidation or winding up, or the
vote upon any action.
10
Nothing contained in this Warrant shall be construed as conferring
upon the Holder the right to vote or to consent or to receive notice as
shareholders in respect of the meetings of shareholders or the election of
Directors of the Company or any other matter, or any rights whatsoever as
shareholders of the Company.
SECTION 10. Notices to Company and the Holder. Unless otherwise
---------------------------------
provided herein, any notice, request, instruction or other document to be given
hereunder by any party to the others shall be in writing and delivered in person
or by courier or by facsimile transmission (with receipt confirmed), or mailed
by certified mail, postage prepaid, return receipt requested (such mailed notice
to be effective on the date such receipt is acknowledged), as follows:
If to the Company:
Guilford Pharmaceuticals Inc.
6611 Tributary Street
Baltimore, Maryland 21224
Attn: Corporate Secretary
Telecopy No.: (410) 631-6899
With a copy to:
Hogan & Hartson, L.L.P.
111 South Calvert Street, 16th Floor
Baltimore, Maryland 21202
Attn: Michael Silver, Esq.
Telecopy No.: (410) 539-6981
If to the Holder:
Amgen Inc.
Amgen Center
1840 DeHavilland Drive
Thousand Oaks, California 91320-1789
Attn: Corporate Secretary
Telecopy No.: (805) 499-8011
With a copy to:
Latham & Watkins
633 West Fifth Street, Suite 4000
Los Angeles, California 90071
Attn: Gary Olson, Esq.
Telecopy No.: (213) 891-8763
or to such other place and with such other copies as either party may designate
as to itself by written notice to the others.
11
SECTION 11. Supplements and Amendments. The Company may not
--------------------------
supplement or amend this Warrant without the prior written approval of the
Holder.
SECTION 12. Successors and Assignment. All the covenants and
-------------------------
provisions of this Warrant by or for the benefit of the Company shall bind and
inure to the benefit of its respective successors and assigns hereunder. This
Warrant is not assignable or transferable by the Holder except in increments of
100,000 Warrant Shares or by operation of law.
SECTION 13. Governing Law. This Warrant shall be deemed to be a
-------------
contract made under the laws of the State of Delaware and for all purposes shall
be construed in accordance with the internal laws of said State, excluding
choice of law provisions.
SECTION 14. Benefits of This Warrant. Nothing in this Warrant shall
------------------------
be construed to give to any person or corporation other than the Company and the
Holder any legal or equitable right, remedy or claim under this Warrant; but
this Warrant shall be for the sole and exclusive benefit of the Company and the
Holder.
SECTION 15. Counterparts. This Warrant may be executed in any number
------------
of counterparts and each of such counterparts shall for all purposes be deemed
to be an original, and all such counterparts shall together constitute but one
and the same instrument.
[Signature Page To Follow]
12
Date: October 1, 1997 GUILFORD PHARMACEUTICALS INC.
By: /s/ Craig R. Smith, M.D.
_____________________________________
Name: Craig R. Smith, M.D.
Title: President and Chief Executive
Officer
- ------------------------------------
Seal
Attest: __________________________
RECEIVED BY:
AMGEN INC.
By: /s/ George A. Vandeman
_____________________________________
Name: George A. Vandeman
Title: Senior Vice President, General
Counsel and Secretary
- ------------------------------------
Seal
Attest: __________________________
S-1
[Form of Election to Purchase
(To Be Executed Upon Exercise Of Warrant)
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant, to receive _________ shares of Common Stock and
herewith tenders payment for such shares to the order of GUILFORD
PHARMACEUTICALS INC. in the amount of $_____ in accordance with the terms
hereof. The undersigned requests that a certificate for such shares be
registered in the name of _______________________________________, whose address
is _______________________________ and that such shares be delivered to
________________ whose address is _________________________________. If said
number of shares is less than all of the shares of Common Stock purchasable
hereunder, the undersigned requests that a new Warrant representing the
remaining balance of such shares be registered in the name of ______________,
whose address is _________________________, and that such Warrant be delivered
to _________________, whose address is __________________.
The undersigned represents that the aforesaid shares of Common Stock
are being acquired for the account of the undersigned for investment and not
with a view to, or for resale in connection with, the distribution thereof and
that the undersigned has no present intention of distributing or reselling such
shares.
The undersigned is an "accredited investor" as defined in Securities
and Exchange Commission Rule 501(a) pursuant to the Securities Act of 1933, as
amended.
Signature:
---------------------------------
Date:
_________________
Signature Guaranteed:
------------------------------------
EXHIBIT 7.3
================================================================================
REGISTRATION RIGHTS AGREEMENT
BY AND BETWEEN
GUILFORD PHARMACEUTICALS INC.
and
AMGEN INC.
Dated as of October 1, 1997
================================================================================
TABLE OF CONTENTS
SECTION 1. Definitions.................................... 1
SECTION 2. Securities Subject to this Agreement........... 3
(a) Registrable Securities......................... 3
(b) Holders of Registrable Securities.............. 3
SECTION 3. Demand Registrations........................... 4
(a) Demand by Holders.............................. 4
(b) Effective Registration......................... 4
(c) Registration Statement Form.................... 4
(d) Selection of Underwriters...................... 5
(e) Registration of Other Securities............... 5
(f) Priority Among Holders of Registrable Securities
in Requested Registration...................... 5
(g) Registration Requirements...................... 5
SECTION 4. Piggyback Registrations........................ 6
(a) Participation.................................. 6
(b) Underwriter's Cutback.......................... 6
(c) No Effect on Demand Registrations.............. 7
SECTION 5. Priority of Other Registration Rights.......... 7
SECTION 6. Hold-Back Agreements........................... 7
(a) Restrictions Applicable to Holders of
Registrable Securities......................... 7
(b) Registration Restrictions Applicable to
the Company.................................... 7
SECTION 7. Registration Procedures........................ 8
SECTION 8. Registration Expenses.......................... 13
SECTION 9. Indemnification................................ 14
(a) Indemnification by Company..................... 14
(b) Indemnification by Holder of Registrable
Securities..................................... 15
(c) Contribution................................... 15
SECTION 10. Transfer of Registration Rights............... 16
SECTION 11. Rule 144...................................... 16
SECTION 12. Participation in Underwritten Registrations... 17
SECTION 13. Miscellaneous................................. 17
(a) Remedies...................................... 17
(b) No Inconsistent Agreements.................... 17
(c) Amendments and Waivers........................ 17
(d) Notices....................................... 17
(e) Successors and Assigns........................ 18
(f) Counterparts.................................. 19
(g) Headings...................................... 19
(h) Governing Law................................. 19
(i) Severability.................................. 19
(j) Entire Agreement.............................. 19
ii
REGISTRATION RIGHTS AGREEMENT
-----------------------------
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is dated as of
---------
October 1, 1997 and entered into by and between GUILFORD PHARMACEUTICALS INC., a
Delaware corporation (the "Company"), and AMGEN INC., a Delaware corporation
-------
(the "Purchaser").
---------
RECITALS
--------
WHEREAS, the Company, GPI NIL Holdings, Inc., a Delaware corporation
and wholly-owned subsidiary of the Company, and the Purchaser have entered into
a collaboration with respect to the research, development and commercialization
of certain small molecule neuroimmunophilin compounds, and have executed a
Binding Term Sheet dated as of August 20, 1997 relating thereto (the "Binding
-------
Term Sheet");
- ----------
WHEREAS, in connection with the Binding Term Sheet, the Purchaser has
agreed to purchase from the Company, and the Company has agreed to sell to the
Purchaser, 640,095 shares of Common Stock and a Warrant for 700,000 shares of
Common Stock for an aggregate cash consideration of $20 million;
WHEREAS, in connection with the foregoing, the Company and the
Purchaser have entered into a Stock and Warrant Purchase Agreement (the
"Purchase Agreement") dated as of October 1, 1997; and
- -------------------
WHEREAS, as contemplated by the Binding Term Sheet, the Company has
agreed to provide the registration rights set forth in this Agreement;
AGREEMENT
---------
NOW, THEREFORE, in consideration of the mutual covenants and premises
contained herein and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions.
-----------
(a) As used in this Agreement, the terms below shall have the
following meanings:
"Agent" shall mean any Person authorized to act and who acts on behalf
-----
of the Purchaser with respect to the transactions contemplated by this
Agreement.
"Collateral Agreements" shall mean the Binding Term Sheet, the Warrant
---------------------
and the Purchase Agreement.
"Common Stock" shall mean the Common Stock, $.01 par value, of the
------------
Company.
1
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
------------
amended from time to time.
"NASD" shall mean the National Association of Securities Dealers, Inc.
----
"Person" shall mean an individual, firm, corporation, partnership,
------
limited liability company, trust or unincorporated organization, or other
entity, or a government or agency or political subdivision thereof, and shall
include any successor (by merger or otherwise) of such Person.
"Prospectus" shall mean the prospectus included in any Registration
----------
Statement, as amended or supplemented by any prospectus supplement with respect
to the terms of the offering of any portion of the Registrable Securities
covered by the Registration Statement and by all other amendments and
supplements to the prospectus, including post-effective amendments and all
material incorporated by reference in such prospectus.
"Registrable Securities" shall mean (i) the Common Stock acquired by
----------------------
the Purchaser pursuant to the terms of the Purchase Agreement, and (ii) the
Warrant Shares. Registrable Securities shall also include any securities which
may be issued or distributed with respect to, or in exchange for, such
Registrable Securities pursuant to a stock dividend, stock split or other
distribution, merger, consolidation, recapitalization or reclassification or
similar transaction; provided, however, that any such Registrable Securities
shall cease to be Registrable Securities to the extent (i) a Registration
Statement with respect to the sale of such Registrable Securities has been
declared effective under the Securities Act and such Registrable Securities have
been disposed of in accordance with the plan of distribution set forth in such
Registration Statement, or (ii) such Registrable Securities can be disposed of
pursuant to Rule 144 without regard to Rule 144(k) (or any similar provisions
then in force) under the Securities Act.
"Registration" shall mean a Registration of the Company's securities
------------
for sale to the public under a Registration Statement.
"Registration Statement" shall mean any Registration Statement of the
----------------------
Company filed with the Securities and Exchange Commission under the rules and
regulations promulgated under the Securities Act, including the Prospectus,
amendments and supplements to such Registration Statement, including post-
effective amendments, and all exhibits and all material incorporated by
reference in such Registration Statement.
"Securities Act" shall mean the Securities Act of 1933, as amended
--------------
from time to time.
"SEC" shall mean the Securities and Exchange Commission.
---
"Underwritten Registration" or "Underwritten Offering" shall mean a
------------------------- ---------------------
Registration in which securities of the Company are sold to an underwriter for
reoffering to the public.
2
"Warrant" shall mean the Warrant to purchase shares of Common Stock,
-------
issued and sold pursuant to the Purchase Agreement dated as of the date hereof,
by and between the Company and the Purchaser.
"Warrant Shares" shall mean any shares of Common Stock issued or
--------------
issuable upon exercise of the Warrant.
(b) Other Defined Terms. The following terms shall have the meanings
-------------------
defined for such terms in the Sections set forth below:
Term Section
---- -------
Agreement Preamble
Company Preamble
Demand Registration Holdback Period 6(b)
Demand Registration 3(a)
Exchange and Registration Rights Agreement 5
Holder 2(b)
Indemnified Holder 9(a)
Piggyback Registration 4(a)
Piggyback Securities 4(b)
Preferred Stock Purchase Agreement 5
Priority Agreements 5
Purchase Agreement Recitals
Purchaser Preamble
Registration Expenses 8(a)(7)
Underwriter's Warrant 5
SECTION 2. Securities Subject to this Agreement.
------------------------------------
(a) Registrable Securities. The securities entitled to the benefits
----------------------
of this Agreement are the Registrable Securities.
(b) Holders of Registrable Securities. Initially, Purchaser is the
---------------------------------
only holder of Registrable Securities, and Registrable Securities shall only
refer to such securities owned of record or beneficially by Purchaser or by a
transferee (or subsequent transferee) of Purchaser pursuant to Section 10 hereof
----------
who has thereby acquired rights hereunder (each a "Holder"). Subject to the
------
foregoing, a Person is deemed to be a Holder of Registrable Securities whenever
such Person owns Registrable Securities or has the right to acquire such
Registrable Securities, whether or not such ownership or right was acquired
pursuant to the Purchase Agreement or the Warrant, and whether or not such
acquisition has actually been effected and disregarding any legal restrictions
upon the exercise of such right.
3
SECTION 3. Demand Registrations.
--------------------
(a) Demand by Holders. During the five-year period commencing on the
-----------------
date hereof, the Holders of at least 50% of the Registrable Securities then
outstanding may make a total of three written requests to the Company for
Registration of Registrable Securities under and in accordance with the
provisions of the Securities Act of all or part of the Registrable Securities.
Any such Registration requested shall hereinafter be referred to as a "Demand
------
Registration." Each request for a Demand Registration shall specify the kind
- ------------
and aggregate amount of Registrable Securities to be registered, the intended
methods of disposition thereof and the information required by Item 507 of
Regulation S-K under the Securities Act. Upon such request for a Demand
Registration, subject to Section 3(g) below, the Company shall use its best
efforts to promptly effect the Registration of such Registrable Securities under
(i) the Securities Act, and (ii) subject to Section 7(h), the blue sky laws of
------------
such jurisdictions as any Holder of such Registrable Securities requesting such
Registration or any underwriter, if any, may reasonably request. The Company
shall also use its best efforts to have all such Registrable Securities
registered with or approved by such other federal or state governmental agencies
or authorities as may be necessary in the opinion of counsel to the Company and
counsel to such Holders of at least 50% of such Registrable Securities to
consummate the disposition of such Registrable Securities.
(b) Effective Registration. Subject to the last paragraph of Section
---------------------- -------
7, the Company shall be deemed to have effected a Demand Registration if the
- -
Registration Statement relating to such Demand Registration is filed with the
SEC but the requesting Holders inform the Company that they desire that the
Registration Statement be withdrawn or abandoned; provided, however, that such
withdrawal does not result from action or inaction on the part of the Company
that has materially and adversely affected the value of such registration to the
participating Holders, or if the Registration Statement is declared effective by
the SEC and remains effective until the earlier of the date on which (i) all the
Registrable Securities subject to such Registration Statement have been disposed
of pursuant thereto or (ii) nine months have elapsed from the date of such
effectiveness; provided, however, that no Demand Registration shall be deemed to
have been effected if (i) such Registration, after it has become effective, is
the subject of any stop order, injunction or other order or requirement of the
SEC or other governmental agency or court for any reason not primarily
attributable to the selling Holders of Registrable Securities, or (ii) the
conditions to closing specified in the purchase agreement or underwriting
agreement entered into in connection with such Registration are not satisfied,
other than by reason of a failure on the part of the selling Holders of
Registrable Securities or any underwriter referred to in Section 3(d).
------------
(c) Registration Statement Form. Registrations under this Section 3
--------------------------- ---------
shall be on such appropriate registration form of the SEC as shall permit the
disposition of such Registrable Securities in accordance with the intended
method or methods of disposition specified in such Holders' requests for such
Registration. If, in connection with any Registration under this Section 3
---------
which is proposed by the Company to be on Form S-3 or any successor form to such
Form, the managing underwriter (if any) or Holders of at least 50% of the
Registrable Securities requesting a Demand Registration shall advise the Company
in writing that in its opinion additional disclosure not required by such form
is of material importance to the success of the
4
offering, then the Company shall consider including such additional
disclosure, subject at all times to the Company's ultimate discretion to include
or not include any additional disclosure.
(d) Selection of Underwriters. If at any time or from time to time
-------------------------
during the time period applicable to Demand Registrations any of the Holders of
the Registrable Securities covered by a Registration Statement desire to sell
Registrable Securities in an Underwritten Offering, the investment banker or
investment bankers that will manage the offering will be selected by the Holders
of at least 50% of the Registrable Securities included in such offering;
provided that the selection of any such investment banker or investment bankers
is subject to consent by the Company, which consent shall not be unreasonably
withheld.
(e) Registration of Other Securities. Subject to Section 5 hereof,
-------------------------------- ---------
whenever the Company shall effect a Registration pursuant to this Section 3 in
---------
connection with an Underwritten Offering by one or more Holders of Registrable
Securities, securities other than Registrable Securities shall be reduced to the
extent determined necessary by the managing underwriter of such offering if such
managing underwriter shall have advised such selling Holders to be covered by
such Registration in writing (with a copy to the Company) that, in its opinion,
the number of securities requested to be included in such Registration exceeds
the number which can be sold in such offering within a price range acceptable to
the selling Holders of at least 50% of the Registrable Securities requested to
be included in such Registration. If no such notice or letter is provided, the
Company may include shares of Common Stock for its own account or for the
account of other shareholders of the Company having the right to include such
shares in a Registration Statement filed by the Company with the SEC.
(f) Priority Among Holders of Registrable Securities in Requested
-------------------------------------------------------------
Registration. If the managing underwriter of an Underwritten Offering pursuant
- ------------
to this Section 3 advises each of the Holders in writing (with a copy to the
---------
Company) that less than all of the Registrable Securities proposed to be
included in such offering should be included (using the same standard described
in subsection (e) hereof), then the amount of Registrable Securities to be
--------------
offered for the accounts of Holders shall be reduced pro rata, based on the
number of Registrable Securities owned by such Holders.
(g) Registration Requirements. Anything in this Section 3 to the
------------------------- ---------
contrary notwithstanding, the Company shall not be required to file any
Registration Statement pursuant to this Section 3, (i) within a period of six
---------
months after the effective date of any other Registration Statement filed
pursuant to a Demand Registration, (ii) for a deferral period of up to 90 days
if the Board of Directors of the Company in good faith determines that such
Registration would interfere with any proposed offering of shares of the
Company's capital stock, pending financing transaction, or acquisition,
corporate reorganization or other significant transaction involving the Company;
provided that the Company shall be able to defer Registration under this
subclause (ii) only one time in any 12-month period, (iii) for a period
beginning on the effective date of any Registration Statement and ending 90 days
thereafter, or (iv) if the estimated aggregate proceeds of an offering of
Registrable Securities (less underwriting discounts and commissions) will be
less than $15 million.
SECTION 4. Piggyback Registrations.
-----------------------
5
(a) Participation. Subject to Sections 4(b) and 5 hereof, if at any
------------- -------------------
time from and after the date hereof, the Company proposes to file or files a
Registration Statement under the Securities Act with respect to any offering of
securities of the same type as the Registrable Securities for its own account
(other than a Registration Statement on Form S-8 or Form S-4 or any successor
form thereto), or for the account of any securityholder of securities of the
same type as the Registrable Securities, then, as promptly as practicable, the
Company shall give written notice of such proposed filing to each Holder of
Registrable Securities and such notice shall offer the Holders of Registrable
Securities the opportunity to include in such registration such number of
Registrable Securities as each such Holder may request (a "Piggyback
---------
Registration"). Subject to Section 5, the Company shall include in such
- ------------ ---------
Registration Statement all Registrable Securities requested within 20 days after
the receipt of any such notice (which request shall specify the Registrable
Securities intended to be disposed of by such Holder) to be included in the
Registration for such offering pursuant to a Piggyback Registration. Each
Holder electing to participate in such Registration Statement shall do so
pursuant to the terms of such proposed registration and shall execute such usual
and customary custody agreements, powers of attorney, underwriting agreements,
holdback agreements or other documents as are reasonably requested or required
by the Company and any underwriter of such offering as provided in Section 12
----------
hereof; provided that Holder shall not be required to represent and warrant to,
or to indemnify, any party with respect to any matters other than as to the
Holder's ownership of the Registrable Securities and with respect to any other
information provided by Holder and required to be included in the Registration
Statement pursuant to SEC Rules and Regulations. Each Holder of Registrable
Securities shall be permitted to withdraw all or part of such Holder's
Registrable Securities from a Piggyback Registration at any time prior to the
effective date thereof.
(b) Underwriter's Cutback. The Company shall use its best efforts to
---------------------
cause the managing underwriter or underwriters of a proposed Underwritten
Offering to permit the Registrable Securities requested to be included in the
Registration for such offering under Section 4(a) (the "Piggyback Securities")
------------ --------------------
to be included on the same terms and conditions as any similar securities
included therein. Notwithstanding the foregoing, but subject to Section 5
---------
hereof, if the managing underwriter or underwriters participating in such
offering advises each of the Holders in writing (with a copy to the Company)
that the total amount of securities requested to be included in such Piggyback
Registration exceeds the amount which can be sold in (or during the time of)
such offering without delaying or jeopardizing the success of the offering
(including the price per share of the securities to be sold), then, after
including all shares proposed to be sold by the Company in a Company-initiated
registration, the amount of securities to be offered for the account of the
Holders shall be reduced pro rata with all other holders participating in such
offering on the basis of the number of shares to be registered by all
stockholders participating in such offering; provided, however that, subject to
Section 5 hereof, the managing underwriter or underwriters may not limit the
- ---------
Registrable Securities or other securities to be included in such Registration
to less than 25% of the securities included therein. Notwithstanding the
foregoing, the Company shall have the right to withdraw or delay the
Registration Statement at any time; provided, however, that written notice of
such withdrawal or delay shall be given to the Holders thereunder.
6
(c) No Effect on Demand Registrations. No Registration of Registrable
---------------------------------
Securities effected pursuant to a request under this Section 4 shall be deemed
---------
to have been effected pursuant to Section 3 hereof or shall relieve the Company
---------
of its obligation to effect any Registration upon request under Section 3
---------
hereof.
SECTION 5. Priority of Other Registration Rights.
-------------------------------------
The parties expressly agree and understand that a Holder's right to
priority in a Registration of Registrable Securities shall at all times be
subordinate to the rights granted under (i) the Series A Preferred Stock
Purchase Agreement, dated as of September 30, 1993, as amended (the "Preferred
---------
Stock Purchase Agreement"), (ii) the Underwriter's Warrant, dated as of June 24,
- ------------------------
1994 (the "Underwriter's Warrant"), and (iii) the Exchange and Registration
---------------------
Rights Agreement, dated as of February 17, 1995 (the "Exchange and Registration
-------------------------
Rights Agreement" and collectively, with the Preferred Stock Purchase Agreement
- ----------------
and the Underwriter's Warrant, the "Priority Agreements") so that inclusion of
-------------------
any Registrable Securities in any Registration requested to be made pursuant to
Sections 3(a) and 4(a) is subject to the prior right to include in such
- ----------------------
Registration any securities requested to be registered by a securityholder under
the Priority Agreements as provided for therein. Notwithstanding the foregoing,
except in the case of a limitation imposed under Sections 3(f) and 4(b), and
----------------------
subject to the conditions of this Section 5, the Company shall use its best
---------
efforts to cause all Registrable Securities to be registered that are requested
to be registered, regardless of the number of securities to be registered under
the Priority Agreements. As a result of the foregoing, if any Registrable
Security is excluded from a Demand Registration due to the existing rights of
such other securityholders, such Registration shall not count as a Demand
Registration.
SECTION 6. Hold-Back Agreements.
--------------------
(a) Restrictions Applicable to Holders of Registrable Securities. If
------------------------------------------------------------
(i) the Company shall file a Registration Statement with respect to its Common
Stock or similar securities or securities convertible into, or exchangeable or
exercisable for, such securities in an Underwritten Offering and (ii) the
managing underwriter or underwriters advises the Company in writing (in which
case the Company shall notify the Holders) that a public sale or distribution of
Registrable Securities (other than those which may be sold, after application of
Section 4(b), by a Holder in connection with a Piggyback Registration) would
- ------------
have material adverse effect on such offering, then such Holder shall, to the
extent not inconsistent with applicable law, refrain from effecting any public
sale or distribution of Registrable Securities during the period following the
effective date of such Registration Statement and until the earliest of (A) the
abandonment of such offering and (B) 90 days, or such shorter date as the
managing underwriter shall require, after the effective date of such
Registration Statement.
(b) Registration Restrictions Applicable to the Company. In the event
---------------------------------------------------
of a Demand Registration, the Company, if requested by the Holders of at least
50% of the Registrable Securities to be included in such Demand Registration,
(i) shall agree not to, and shall cause its executive officers and directors not
to, effect any public sale or distribution of its Common Stock or similar
securities or securities convertible into, or exchangeable or exercisable for,
such securities during the 90-day period following the effective date of a
Registration
7
Statement relating to an Underwritten Offering of Registrable Securities if the
managing underwriter or underwriters determine such public sale or distribution
would have a material adverse effect on such offering and (ii) shall (x) cause
each securityholder of the Company's privately placed equity securities issued
in connection with a financing transaction involving at least 5% of the
Company's then outstanding equity securities at any time after the date hereof
(provided that the foregoing shall not apply with respect to securities issued
in connection with corporate partnering transactions or off-balance sheet
financing transactions to fund early stage research, and (y) use its reasonable
best efforts to cause each other securityholder of the Company owning at least
10% of the Company's then outstanding equity securities (other than a
securityholder permitted to file a Schedule 13G under the Exchange Act) to
agree, not to effect a public sale or distribution of the Common Stock during
the 90-day period following the effective date of a Registration Statement
relating to an underwritten public offering of the Common Stock if the managing
underwriter or underwriters determine such public sale or distribution would
have a material adverse effect on such offering.
SECTION 7. Registration Procedures.
-----------------------
In connection with the Company's Registration obligations pursuant to
Sections 3 and 4 hereof, the Company will use its best efforts to effect such
- ----------------
Registration to permit the sale of such Registrable Securities in accordance
with the intended method or methods of disposition thereof, and pursuant thereto
the Company will as expeditiously as possible:
(a) before filing a Registration Statement thereto, furnish to the
Holders of the Registrable Securities covered by such Registration
Statement and the underwriters, if any, copies of such Registration
Statement proposed to be filed, and any participating Holder or the
underwriters, may suggest such changes thereto and the Company will
consider including such changes, subject at all times to the Company's
ultimate discretion to include or not include such changes;
(b) prepare and file with the SEC a Registration Statement or
Registration Statements relating to the applicable Demand Registration or
Piggyback Registration including all exhibits and financial statements
required by the SEC to be filed therewith, and use its best efforts to
cause such Registration Statement to become effective under the Securities
Act; and prepare and file with the SEC such amendments and post-effective
amendments to such Registration Statement, and such supplements to the
Prospectus, as may be requested by any underwriter of Registrable
Securities or as may be required by the rules, regulations or instructions
applicable to the Registration form utilized by the Company or by the
Securities Act or rules and regulations otherwise necessary to keep the
Registration Statement effective for a period of not less than nine months
(or such shorter period which will terminate when all Registrable
Securities covered by such Registration Statement have been sold or
withdrawn); and cause the Prospectus as so supplemented to be filed
pursuant to Rule 424 under the Securities Act; and comply with the
provisions of the Securities Act and the Exchange Act with respect to the
disposition of all securities covered by such Registration Statement during
the applicable period in accordance with the intended methods of
disposition by the selling Holders thereof set forth in such Registration
Statement or supplement to the Prospectus;
8
(c) notify the selling Holders of Registrable Securities and the managing
underwriters, if any, promptly, and (if requested by any such Person)
confirm such advice in writing,
(1) when the Prospectus or any Prospectus supplement or post-
effective amendment has been filed, and, with respect to the
Registration Statement or any post-effective amendment, when the same
has become effective,
(2) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose,
(3) if at any time the representations and warranties of the
Company contemplated by paragraph (n)(1) below cease to be true and
----------------
correct,
(4) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Registrable
Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose, and
(5) of the existence of any fact which results in the
Registration Statement, the Prospectus or any document incorporated
therein by reference containing an untrue statement of material fact
or omitting to state a material fact required to be stated therein or
necessary to make the statements therein not misleading;
(d) make every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of the Registration Statement at the earliest
possible moment;
(e) if requested by the managing underwriter or underwriters or a
Holder of Registrable Securities being sold in connection with an
Underwritten Offering pursuant to Section 3 hereof, incorporate in a
Prospectus supplement or post-effective amendment such information as the
managing underwriters and the Holders of at least 50% of the Registrable
Securities being sold agree should be included therein relating to the plan
of distribution with respect to such Registrable Securities, including,
without limitation, information with respect to the amount of Registrable
Securities being sold to such underwriters, the purchase price being paid
therefor by such underwriters and with respect to any other terms of the
underwritten (or best efforts underwritten) offering of the Registrable
Securities to be sold in such offering; and make all required filings of
such Prospectus supplement or post-effective amendment as soon as notified
of the matters to be incorporated in such Prospectus supplement or post-
effective amendment;
(f) furnish to each selling Holder of Registrable Securities and each
managing underwriter, without charge, at least one copy of the Registration
Statement and any post-effective amendment thereto, including financial
statements and schedules, all documents incorporated therein by reference
and all exhibits (including those incorporated by reference);
9
(g) deliver to each selling Holder of Registrable Securities and the
underwriters, if any, without charge, as many copies of the Prospectus
(including each preliminary prospectus) and any amendment or supplement
thereto as such Persons may reasonably request; the Company consents to the
use of the Prospectus or any amendment or supplement thereto by each of the
selling Holders of Registrable Securities and the underwriters, if any, in
connection with the offering and sale of the Registrable Securities covered
by the Prospectus or any amendment or supplement thereto;
(h) prior to any public offering of Registrable Securities, register
or qualify or cooperate with the selling Holders of Registrable Securities,
the underwriters, if any, and their respective counsel in connection with
the Registration or qualification of such Registrable Securities for offer
and sale under the securities or blue sky laws of such jurisdictions as any
selling Holder of Registrable Securities or any underwriter reasonably
requests in writing and do any and all other acts or things reasonably
necessary to enable the disposition in such jurisdictions of the
Registrable Securities covered by the Registration Statement; provided that
the Company will not be required to qualify generally to do business in any
jurisdiction where it is not then so qualified or to take any action which
would subject it to taxation or general service of process in any such
jurisdiction where it is not then so subject;
(i) cooperate with the selling Holders of Registrable Securities and
the managing underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold and
not bearing any restrictive legends; and enable such Registrable Securities
to be in such denominations and registered in such names as the managing
underwriters may request at least two business days prior to any sale of
Registrable Securities to the underwriters;
(j) use its best efforts to cause the Registrable Securities covered
by the applicable Registration Statement to be registered with or approved
by such other foreign governmental agencies or authorities, and the NASD,
as may be necessary to enable the seller or selling Holders thereof or the
underwriters, if any, to consummate the disposition of such Registrable
Securities; provided, however, that the Holders shall pay any and all costs
associated with any such registration or approval with any foreign
governmental agency or authority;
(k) if any fact contemplated by paragraph (c)(6) above shall exist,
----------------
prepare a supplement or post-effective amendment to the Registration
Statement or the related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter
delivered to the purchasers of the Registrable Securities, the Prospectus
will not contain an untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading;
(l) cause all Registrable Securities covered by the Registration
Statement to be listed on each securities exchange on which similar
securities issued by the Company
10
are then listed if requested by the Holders of at least 50% of such
Registrable Securities or the managing underwriters, if any;
(m) not later than the effective date of the applicable Registration
Statement, provide a CUSIP number for all Registrable Securities and
provide the applicable transfer agent with printed certificates for the
Registrable Securities which are in a form eligible for deposit with
Depositary Trust Company;
(n) enter into agreements (including underwriting agreements in
customary form for such underwriter and consistent with then current market
practice) and take all other appropriate and reasonable actions in order to
expedite or facilitate the disposition of such Registrable Securities and
in such connection, whether or not an underwriting agreement is entered
into and whether or not the Registration is an Underwritten Registration:
(1) make such representations and warranties to the Holders of
such Registrable Securities and the underwriters, if any, in form,
substance and scope as are customarily made by issuers to underwriters
in Underwritten Offerings in customary form and consistent with then
current market practice;
(2) obtain opinions of counsel to the Company (which counsel and
opinions (in form, scope and substance) shall be reasonably
satisfactory to the managing underwriters, if any, addressed to the
underwriters, if any, in customary form covering the matters
customarily covered in opinions requested in primary Underwritten
Offerings and such other matters as may be reasonably requested by
such underwriters;
(3) obtain "cold comfort" letters and updates thereof from the
Company's independent certified public accountants addressed to the
underwriters, if any, such letters to be in customary form and
consistent with then current market practice and covering matters of
the type customarily covered in "cold comfort" letters by underwriters
in connection with primary Underwritten Offerings;
(4) if an underwriting agreement is entered into, cause the same
to set forth in full the indemnification provisions and procedures
substantially to the effect set forth in Section 9 hereof with respect
---------
to all parties to be indemnified pursuant to said Section; and
(5) deliver such documents and certificates as may be reasonably
requested in writing by the Holders of at least 50% of the Registrable
Securities being sold or the managing underwriters, if any, to
evidence compliance with paragraph (k) above and with any customary
-------------
conditions contained in the underwriting agreement or other agreement
entered into by the Company.
11
The above shall be done at each closing under such underwriting or similar
agreement or as and to the extent required thereunder;
(o) make available for inspection by any underwriter (including any
"qualified independent underwriter" that is required to be retained in
accordance with the rules and regulations of the NASD) participating in any
disposition pursuant to such Registration Statement, and any attorney or
accountant retained by underwriter, all financial and other records,
pertinent corporate documents and properties of the Company, and cause the
Company's officers, directors and employees to supply all information
reasonably requested by any such representative, underwriter, attorney or
accountant in connection with the Registration; provided that any records,
documents, properties or information that are designated by the Company in
writing as confidential shall be kept confidential by such Person and shall
not be used for any purpose other than in connection with such Registration
Statement unless disclosure of such records, documents, properties and
information is required by court or administrative order;
(p) otherwise use its best efforts to comply with all applicable rules
and regulations of the SEC, and make generally available to its security
holders, earnings statements satisfying the provisions of Section 11(a) of
the Securities Act and Rule 158 promulgated thereunder; and
(q) cooperate and assist in any filings required to be made with the
NASD and, subject to Section 7(o), in the performance of any due diligence
------------
investigation by any underwriter (including any "qualified independent
underwriter" that is required to be retained in accordance with the rules
and regulations of the NASD).
The Company may require each Holder of Registrable Securities as to
which any Registration is being effected to furnish to the Company such
information regarding such Holder and such Holder's intended method of
distribution of such Registrable Securities, as the Company may from time to
time reasonably request in writing.
Each Holder of Registrable Securities agrees by acquisition of such
Registrable Securities that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 7(c)(6) hereof, such
---------------
Holder will forthwith discontinue disposition of Registrable Securities until
such Holder's receipt of the copies of the supplemented or amended Prospectus
contemplated by Section 7(k) hereof, or until it is advised in writing by the
------------
Company that the use of the Prospectus may be resumed, and has received copies
of any additional or supplemental filings which are incorporated by reference in
the Prospectus, and, if so directed by the Company, such Holder will deliver to
the Company (at the Company's expense) all copies, other than permanent file
copies then in such Holder's possession, of the Prospectus covering such
Registrable Securities current at the time of receipt of such notice. In the
event the Company shall give any such notice, the time periods during which such
Registration Statement shall be maintained effective shall be extended by the
number of days during the period from and including the date of the giving of
such notice to and including the date when each seller of Registrable Securities
covered by such Registration Statement either receives the copies of the
12
supplemented or amended prospectus contemplated by Section 7(k) hereof or is
------------
advised in writing by the Company that the use of the Prospectus may be resumed.
SECTION 8. Registration Expenses.
---------------------
(a) All expenses incident to the Company's performance of or
compliance with this Agreement will be paid by the Company, regardless of
whether the Registration Statement becomes effective, including without
limitation:
(1) all Registration and filing fees (including with respect to
filings required to be made with the SEC);
(2) fees and expenses of compliance with securities or blue sky
laws (including fees and disbursements of counsel for the underwriters or
selling Holders in connection with blue sky qualifications of the
Registrable Securities and determination of their eligibility for
investment under the laws of such jurisdictions as the managing
underwriters or Holders of at least 50% of the Registrable Securities being
sold may designate);
(3) printing (including expenses of printing certificates for the
Registrable Securities in a form eligible for deposit with the Depositary
Trust Company and of printing prospectuses), messenger, telephone and
delivery expenses;
(4) fees and disbursements of counsel for the Company;
(5) fees and disbursements of all independent certified public
accountants of the Company (including the expenses of any "cold comfort"
letters required by or incident to such performance);
(6) fees and expenses of other Persons retained by the Company;
and
(7) all Registration, filing and other fees and expenses
associated with any NASD filing required to be made in connection with the
Registration Statement (all such expenses being herein called "Registration
------------
Expenses").
--------
The Company will, in any event, pay its internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expense of any annual audit, the
fees and expenses incurred in connection with the listing of the securities to
be registered on each securities exchange on which similar securities issued by
the Company are then listed, rating agency fees and the fees and expenses of any
Person, including special experts, retained by the Company. Notwithstanding any
provision to the contrary, if a registration initiated under Section 3 is
---------
withdrawn by the Holders initiating such registration under circumstances that
would nevertheless be considered a Demand Registration under Section 3(b), the
------------
Company shall have no obligation to pay expenses of such registration and all
such expenses shall be paid by the Holders initiating such registration.
13
(b) Each selling Holder of the Registrable Securities shall pay all
discounts, commissions, fees and expenses of the underwriters, selling brokers,
dealer managers and similar industry professionals, transfer taxes and any out-
of-pocket costs and expenses of such selling Holder including the fees and
expenses of counsel for such selling Holder relating to the distribution of such
Registrable Securities.
SECTION 9. Indemnification.
---------------
(a) Indemnification by Company. The Company agrees to indemnify and
--------------------------
hold harmless each Holder of Registrable Securities, its officers, directors,
employees and Agents and each Person who controls such Holder within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act
(each such person being sometimes hereinafter referred to as an "Indemnified
-----------
Holder") from and against all losses, claims, damages, liabilities and expenses
- ------
(including reasonable costs of investigation and legal expenses) arising out of
or based upon any untrue statement or alleged untrue statement of a material
fact contained in any Registration Statement or Prospectus or in any amendment
or supplement thereto or in any preliminary prospectus, or arising out of or
based upon any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages, liabilities or
expenses arise out of or are based upon any such untrue statement or omission or
allegation thereof based upon information furnished in writing to the Company by
such Holder or any underwriter expressly for use therein; provided, however,
that the Company shall not be liable in any such case to the extent that any
such loss, claim, damage, liability or expense arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission in
any Prospectus or preliminary prospectus, if such untrue statement or alleged
untrue statement, omission or alleged omission is completely corrected in an
amendment or supplement to the Prospectus or preliminary prospectus and if,
having previously been furnished by or on behalf of the Company with copies of
the Prospectus or preliminary prospectus as so amended or supplemented, such
Holder thereafter fails to deliver such Prospectus or preliminary prospectus as
so amended or supplemented, prior to or concurrently with the sale of a
Registrable Security to the person asserting such loss, claim, damage, liability
or expense who purchased such Registrable Security which is the subject thereof
from such Holder. This indemnity will be in addition to any liability which the
Company may otherwise have.
If any action or proceeding (including any governmental investigation
or inquiry) shall be brought or asserted against an Indemnified Holder in
respect of which indemnity may be sought from the Company, such Indemnified
Holder shall promptly notify the Company in writing, and the Company shall
assume the defense thereof, including the employment of counsel satisfactory to
such Indemnified Holder and the payment of all expenses. Such Indemnified
Holder shall have the right to employ separate counsel in any such action and to
participate in the defense thereof, but the fees and expenses of such counsel
shall be at the expense of such Indemnified Holder unless (a) the Company has
agreed to pay such fees and expenses or (b) the Company shall have failed to
assume the defense of such action or proceeding and has failed to employ counsel
satisfactory to such Indemnified Holder in any such action or proceeding or (c)
the named parties to any such action or proceeding (including any impleaded
parties) include both such Indemnified Holder and the Company, and such
Indemnified Holder shall have been
14
advised by counsel that there may be one or more legal defenses available to
such Indemnified Holder which are different from or additional to those
available to the Company (in which case, if such Indemnified Holder notifies the
Company in writing that it elects to employ separate counsel at the expense of
the Company, the Company shall not have the right to assume the defense of such
action or proceeding on behalf of such Indemnified Holder, it being understood,
however, that the Company shall not, in connection with any one such action or
proceeding or separate but substantially similar or related actions or
proceedings in the same jurisdiction arising out of the same general allegations
or circumstances, be liable for the reasonable fees and expenses of more than
one separate firm of attorneys at any time for such Indemnified Holder and any
other Indemnified Holders, which firm shall be designated in writing by such
Indemnified Holders). The Company shall not be liable for any settlement of any
such action or proceeding effected without its written consent, but if settled
with its written consent, or if there be a final judgment for the plaintiff in
any such action or proceeding, the Company agrees to indemnify and hold harmless
such Indemnified Holders from and against any loss or liability by reason of
such settlement or judgment.
(b) Indemnification by Holder of Registrable Securities. Each Holder
---------------------------------------------------
of Registrable Securities agrees to indemnify and hold harmless the Company, its
directors and officers and each Person, if any, who controls the Company within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from the Company to
such Holder, but only with respect to (i) information relating to such Holder
furnished in writing by such Holder expressly for use in, and information
provided under Section 3(a) hereof for use in, any Registration Statement or
Prospectus, or any amendment or supplement thereto, or any preliminary
prospectus and (ii) any loss, claim, damage, liability or expense described in
the proviso to the first sentence of Section 9(a). In case any action or
------------
proceeding shall be brought against the Company or its directors or officers or
any such controlling person, in respect of which indemnity may be sought against
a Holder of Registrable Securities, such Holder shall have the rights and duties
given the Company and the Company or its directors or officers or such
controlling person shall have the rights and duties given to each Holder by the
preceding paragraph. In no event shall the liability of any selling Holder of
Registrable Securities hereunder be greater in amount than the dollar amount of
the proceeds received by such Holder upon the sale of the Registrable Securities
giving rise to such indemnification obligation.
The Company shall be entitled to receive indemnities from
underwriters, selling brokers, dealer managers and similar securities industry
professionals participating in the distribution, to the same extent as provided
above with respect to information so furnished in writing by such Persons
specifically for inclusion in any Prospectus or Registration Statement or any
amendment or supplement thereto, or any preliminary prospectus.
(c) Contribution. If the indemnification provided for in this Section
------------ -------
9 is unavailable to an indemnified party under Section 9(a) or Section 9(b)
- - ------------ ------------
hereof (other than by reason of exceptions provided in those Sections) in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then each applicable indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages, liabilities or
expenses in such
15
proportion as is appropriate to reflect the relative fault of the Company on the
one hand and of the Indemnified Holder on the other in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative fault of the Company on the one hand and of the Indemnified Holder
on the other shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company or by the Indemnified Holder and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses referred to in Section 9(a) or
------------
Section 9(b) shall be deemed to include, subject to the limitations set forth in
- ------------
the second paragraph of Section 9(a), any legal or other fees or expenses
------------
reasonably incurred by such party in connection with investigating or defending
any action or claim.
The Company and each Holder of Registrable Securities agree that it
would not be just and equitable if contribution pursuant to this Section 9(c)
------------
were determined by pro rata allocation or by any other method of allocation
which does not take account of the equitable considerations referred to in the
immediately preceding paragraph. Notwithstanding the provisions of this Section
-------
9(c), an Indemnified Holder shall not be required to contribute any amount in
- ----
excess of the amount by which the total price at which the Registrable
Securities sold by such Indemnified Holder or its affiliated Indemnified Holders
and distributed to the public were offered to the public exceeds the amount of
any damages which such Indemnified Holder, or its affiliated Indemnified Holder,
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
SECTION 10. Transfer of Registration Rights.
-------------------------------
The rights to cause the Company to register securities granted by the
Company hereunder may be transferred or assigned by Purchaser or a subsequent
Holder in writing to a transferee or assignee; provided, however, that such
transfer is in connection with the sale of Registerable Securities covering a
minimum of the greater of 25% of the Registrable Securities then outstanding or
200,000 shares of Common Stock. Such Holder within a reasonable time after said
transfer shall give written notice to the Company, stating the name and address
of said transferee or assignee and identifying the securities with respect to
which such registration rights are being assigned. Subsequent transfers or
assignments of such registration rights may also be effected in accordance with
the foregoing requirements.
SECTION 11. Rule 144.
--------
The Company covenants that it will file the reports required to be
filed by it under the Exchange Act and the rules and regulations adopted by the
SEC thereunder, all to the extent required from time to time to enable such
Holder to sell Registrable Securities without Registration under the Securities
Act within the limitation of the exemptions provided by (a) Rule 144 under the
Securities Act, as such Rule may be amended from time to time, or (b) any
similar
16
rule or regulation hereafter adopted by the SEC. Upon the request of
any Holder of Registrable Securities, the Company will deliver to such Holder a
written statement as to whether it has complied with such information and
requirements.
SECTION 12. Participation in Underwritten Registrations.
-------------------------------------------
Subject to Section 5 hereof, no Person may participate in any
---------
Underwritten Registration hereunder unless such Person (a) agrees to sell such
Person's securities on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and (b)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents required under the terms of such
underwriting arrangements.
SECTION 13. Miscellaneous.
-------------
(a) Remedies. Each of the parties hereto, in addition to being
--------
entitled to exercise all rights provided herein, in the Purchase Agreement and
granted by law, including recovery of damages, will be entitled to specific
performance of its rights under this Agreement. Each of the parties hereto
agrees that monetary damages would not be adequate compensation for any loss
incurred by reason of a breach by it of the provisions of this Agreement and
hereby agrees to waive the defense in any action for specific performance that a
remedy at law would be adequate.
(b) No Inconsistent Agreements. From and after the date hereof,
--------------------------
except with respect to registration rights granted by the Company pursuant to
the Priority Agreements, the Company shall not enter into any agreement granting
any holder or prospective holder of any securities of the Company registration
rights with respect to such securities unless such new registration rights are
pari passu with, subordinate to, or otherwise do not materially adversely affect
the rights of Holders granted hereunder. The Company represents and warrants
that the rights granted to the Holders of Registrable Securities hereunder do
not in any way conflict with and are not inconsistent with the rights granted to
the holders of the Company's securities under any agreement in effect on the
date hereof.
(c) Amendments and Waivers. The provisions of this Agreement,
----------------------
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given unless the Company has obtained the written consent of Holders
of at least 50% of the then outstanding Registrable Securities. Notwithstanding
the foregoing, a waiver or consent to departure from the provisions hereof that
relates exclusively to the rights of Holders of Registrable Securities whose
securities are being sold pursuant to a Registration Statement and that does not
directly or indirectly affect the rights of other Holders of Registrable
Securities may be given by the Holders of a majority of the Registrable
Securities being sold.
(d) Notices. Unless otherwise provided herein, any notice, request,
-------
instruction or other document to be given hereunder by any party to the others
shall be in writing and delivered in person or by courier or by facsimile
transmission (with receipt confirmed), or mailed
17
by certified mail, postage prepaid, return receipt requested (such mailed
notice to be effective on the date of such receipt is acknowledged), as follows:
If to the Holder of Registrable Securities, at the most current address
given by such Holder to the Company in accordance with the provisions of this
Section 12(d), which address initially is, with respect to the Purchaser:
Amgen Inc.
Amgen Center
1840 DeHavilland Drive
Thousand Oaks, California 91320-1789
Attn: Corporate Secretary
Telecopy No.: (805) 499-8011
With a copy to:
Latham & Watkins
633 West Fifth Street
Los Angeles, California 90071
Attn: Gary Olson, Esq.
Telecopy No.: (213) 891-8763
(ii) if to the Company, initially to:
Guilford Pharmaceuticals Inc.
6611 Tributary Street
Baltimore, Maryland 21224
Attn: Corporate Secretary
Telecopy No.: (410) 631-6899
With a copy to:
Hogan & Hartson, L.L.P.
111 South Calvert Street, 16th Floor
Baltimore, Maryland 21202
Attn: Michael Silver, Esq.
Telecopy No.: (410) 539-6981
or to such other place and with such other copies as either party may designate
as to itself by written notice to the others.
(e) Successors and Assigns. Except as otherwise expressly provided
----------------------
herein, this Agreement shall inure to the benefit of and be binding upon the
successors and assigns of each of the parties, including without limitation,
subsequent Holders of Registrable Securities; provided, however, that this
Agreement shall not inure to the benefit of or be binding upon a
18
successor or assign of a Holder of Registrable Securities unless and to the
extent such successor or assign acquired Registrable Securities from such
Holder.
(f) Counterparts. This Agreement may be executed in any number of
------------
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(g) Headings. The headings in this Agreement are for convenience of
--------
reference only and shall not limit or otherwise affect the meaning hereof.
(h) Governing Law. This Agreement shall be governed by and construed
-------------
in accordance with the laws of the State of Delaware (without regard to choice
of law provisions).
(i) Severability. In the event that any one or more of the provisions
------------
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(j) Entire Agreement. This Agreement together with the Collateral
----------------
Agreements are intended by the parties as a final expression of their agreement
and intended to be a complete and exclusive statement of the agreement and
understanding of the parties hereto in respect of the subject matter contained
herein. There are no restrictions, promises, warranties or undertakings, other
than those set forth or referred to herein with respect to the registration
rights granted by the Company with respect to the securities sold pursuant to
the Purchase Agreement. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter including
without limitation Exhibit A to the Binding Term Sheet.
[Signature Page To Follow]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
GUILFORD PHARMACEUTICALS INC.
By:/s/ Craig R. Smith, M.D.
---------------------------------------------
Name: Craig R. Smith, M.D.
Title: President and Chief Executive Officer
AMGEN INC.
By: /s/ George A. Vandeman
-----------------------------------------------
Name: George A. Vandeman
Title: Senior Vice President, General Counsel
and Secretary
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