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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 28, 2000
REGISTRATION NO. 333-33912
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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 1 TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
MILLENNIUM PHARMACEUTICALS, INC.
(Exact name of Registrant as Specified in Its Charter)
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<S> <C> <C>
DELAWARE 8731 04-3177038
(State or Other Jurisdiction (Primary Standard Industrial (I.R.S. Employer
of
Incorporation or Classification Code Number) Identification No.)
Organization)
</TABLE>
75 SIDNEY STREET
CAMBRIDGE, MA 02139
(617) 679-7000
(Address, Including Zip Code, and Telephone Number, Including Area Code, of
Registrant's Principal Executive Offices)
MARK J. LEVIN
CHIEF EXECUTIVE OFFICER
MILLENNIUM PHARMACEUTICALS, INC.
75 SIDNEY STREET
CAMBRIDGE, MA 02139
(617) 679-7000
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code,
Of Agent for Service)
--------------------------
WITH COPIES TO:
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DAVID E. REDLICK, ESQ. JOHN B. DOUGLAS III, ESQ.
KENNETH A. HOXSIE, ESQ. GENERAL COUNSEL
HALE AND DORR LLP MILLENNIUM PHARMACEUTICALS, INC.
60 STATE STREET 75 SIDNEY STREET
BOSTON, MA 02109 CAMBRIDGE, MA 02139
</TABLE>
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date of this Registration Statement and upon the
effective time of the merger (the "Merger") of Millennium Predictive
Medicine, Inc. with and into MPMx Acquisition Corp., a wholly-owned subsidiary
of the Registrant, which is expected to occur on the twentieth business day
following the mailing of the prospectus included in this Registration Statement.
If the securities being registered on this form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. / /
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. / /
If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
--------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a)OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THIS REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(a), MAY DETERMINE.
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THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT fILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES, AND WE ARE NOT SOLICITING OFFERS TO BUY THESE
SECURITIES, IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
<PAGE>
SUBJECT TO COMPLETION, DATED APRIL 28, 2000
MILLENNIUM PREDICTIVE MEDICINE, INC.
INFORMATION STATEMENT
---------------------
MILLENNIUM PHARMACEUTICALS, INC.
PROSPECTUS
We are sending you this information statement/prospectus to describe the
proposed merger between Millennium Predictive Medicine, Inc. and Millennium
Pharmaceuticals, Inc. If we complete this merger, Millennium Predictive Medicine
will merge with and into MPMx Acquisition Corp., a wholly-owned subsidiary of
Millennium Pharmaceuticals, and, unless you seek to exercise your appraisal
rights, your shares of Millennium Predictive Medicine common stock and preferred
stock will be converted into shares of Millennium Pharmaceuticals common stock.
For each of your shares of Millennium Predictive Medicine common stock and
preferred stock, you will receive 0.4 shares of Millennium Pharmaceuticals
common stock, which is referred to in this prospectus as the conversion ratio.
We will round the total number of shares of Millennium Pharmaceuticals common
stock you receive down to the nearest whole number of shares, and you will
receive a cash payment for any remaining fraction of a share.
The holders of 100% of the outstanding voting stock of Millennium Predictive
Medicine have voted to merge Millennium Predictive Medicine into Millennium
Pharmaceuticals. No further action by Millennium Predictive Medicine
stockholders is necessary to complete the merger. WE ARE NOT ASKING YOU FOR A
PROXY TO VOTE YOUR SHARES AND YOU ARE REQUESTED NOT TO SEND US A PROXY TO VOTE
YOUR SHARES. We expect the merger will be completed on the twentieth business
day following the mailing of this information statement/ prospectus.
The board of directors of Millennium Predictive Medicine, based on a
recommendation of a special committee consisting of a disinterested director,
has approved the merger agreement between Millennium Predictive Medicine and
Millennium Pharmaceuticals. The special committee retained its own legal
counsel, Mintz Levin Cohn Ferris Glovsky and Popeo PC, and received an opinion
from Deutsche Banc Alex. Brown as to the fairness, from a financial point of
view, of the conversion ratio to the common stockholders of Millennium
Predictive Medicine.
This information statement/prospectus is also Millennium Pharmaceuticals'
offering document or prospectus for the shares of Millennium Pharmaceuticals
common stock that it will issue to Millennium Predictive Medicine stockholders
in the merger. Millennium Pharmaceuticals common stock is listed on the Nasdaq
Stock Market under the symbol "MLNM."
THE COMMON STOCK OFFERED HEREBY INVOLVES A HIGH DEGREE OF RISK. SEE "RISK
FACTORS" BEGINNING ON PAGE 8.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THE MERGER OR THE SECURITIES TO BE
ISSUED UNDER THIS INFORMATION STATEMENT/PROSPECTUS OR DETERMINED IF THIS
INFORMATION STATEMENT/PROSPECTUS IS ACCURATE OR ADEQUATE. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
This information statement/prospectus is dated , 2000, and was
first mailed to stockholders of Millennium Predictive Medicine on or about
, 2000.
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TABLE OF CONTENTS
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PAGE
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QUESTIONS AND ANSWERS ABOUT THE MERGER...................... 1
SUMMARY..................................................... 3
The Companies............................................. 3
Reasons for the Merger.................................... 4
No Further Stockholder Approval Required; Board
Approvals............................................... 4
The Merger................................................ 4
RISK FACTORS................................................ 8
MILLENNIUM PHARMACEUTICALS SELECTED FINANCIAL DATA.......... 17
Comparative Per Share Data................................ 17
MARKET PRICE AND DIVIDEND DATA.............................. 18
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS........... 19
THE MERGER.................................................. 20
General................................................... 20
Millennium Pharmaceuticals' Reasons for the Merger........ 20
Millennium Predictive Medicine's Reasons for the Merger... 20
Background of the Merger.................................. 21
Opinion of Deutsche Banc Alex. Brown...................... 22
Millennium Predictive Medicine Stock Options.............. 27
Effective Time of the Merger.............................. 27
Certain Federal Income Tax Consequences................... 27
Accounting Treatment...................................... 28
Listing of Shares of Millennium Pharmaceuticals Common
Stock on the Nasdaq Stock Market........................ 29
Appraisal Rights of Dissenting Stockholders of Millennium
Predictive Medicine..................................... 29
THE MERGER AGREEMENT........................................ 33
The Merger................................................ 33
Consideration To Be Received In The Merger................ 33
Procedures For Surrender Of Millennium Predictive Medicine
Certificates; Fractional Shares......................... 33
Effect on the Millennium Predictive Medicine 1997 Equity
Incentive Plan.......................................... 34
Representations And Warranties............................ 34
Covenants................................................. 35
Conditions................................................ 36
Termination............................................... 37
Amendments and Waivers.................................... 37
INFORMATION CONCERNING MILLENNIUM PHARMACEUTICALS........... 38
Recent Developments....................................... 38
Additional Information.................................... 38
INFORMATION CONCERNING MILLENNIUM PREDICTIVE MEDICINE....... 39
Business.................................................. 39
Outstanding Stock; No Public Trading Market............... 42
Dividend Policy........................................... 42
Quantitative and Qualitative Disclosures About Market
Risk.................................................... 42
Other Matters............................................. 42
EXECUTIVE OFFICERS AND DIRECTORS OF MILLENNIUM PREDICTIVE
MEDICINE.................................................. 43
SECURITY OWNERSHIP OF DIRECTORS, EXECUTIVE OFFICERS AND
PRINCIPAL STOCKHOLDERS OF MILLENNIUM PREDICTIVE
MEDICINE.................................................. 45
COMPARISON OF STOCKHOLDER RIGHTS............................ 47
EXPERTS..................................................... 53
LEGAL MATTERS............................................... 53
WHERE YOU CAN FIND MORE INFORMATION......................... 53
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APPENDICES
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APPENDIX A-- Agreement and Plan of Merger by and among Millennium
Pharmaceuticals, Inc, MPMx Acquisition Corp. and Millennium
Predictive Medicine, Inc., dated March 1, 2000.............. A-1
APPENDIX B-- Opinion of Deutsche Bank Securities Inc..................... A-2
APPENDIX C-- Section 262 of the Delaware General Corporation Law......... A-2
</TABLE>
This document incorporates important business and financial information
about Millennium Pharmaceuticals that has been filed with the SEC that is
neither included in nor delivered with this document. Millennium Pharmaceuticals
will provide you with copies of this information, without charge, upon written
or oral request to:
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<S> <C> <C>
Millennium Pharmaceuticals, Inc.
75 Sidney Street
Cambridge, MA 02139
(617) 679-7000
Attention: Corporate Secretary
</TABLE>
IN ORDER TO OBTAIN DELIVERY OF THIS INFORMATION PRIOR TO THE CLOSING OF THE
MERGER, YOU SHOULD REQUEST SUCH INFORMATION NO LATER THAN , 2000.
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QUESTIONS AND ANSWERS ABOUT THE MERGER
Q. WHAT IS THE PROPOSED TRANSACTION?
A. The proposed transaction is a merger of Millennium Predictive Medicine with
and into MPMx Acquisition Corp., a wholly-owned subsidiary of Millennium
Pharmaceuticals that was formed for this transaction. As a result,
Millennium Predictive Medicine will become a wholly-owned subsidiary of
Millennium Pharmaceuticals and Millennium Predictive Medicine stockholders
will have their shares of Millennium Predictive Medicine common stock and
preferred stock converted into shares of Millennium Pharmaceuticals common
stock.
Q. WHAT WILL I RECEIVE IN THE MERGER?
A. Each share of Millennium Predictive Medicine common stock and preferred stock
that you own will be converted into 0.4 shares of Millennium Pharmaceuticals
common stock. You will receive a cash payment in place of any fractional
share of Millennium Pharmaceuticals common stock you would have otherwise
received.
For example, if you own 1,000 shares of Millennium Predictive Medicine
Class B common stock, you will receive 400 shares of Millennium
Pharmaceuticals common stock. The total value of the shares of Millennium
Pharmaceuticals common stock Millennium Pharmaceuticals will issue in this
transaction, based on the closing price per share of Millennium
Pharmaceuticals common stock of $63.25 on April 27, 2000, is about
$86 million.
Q. WILL THE CONVERSION RATIO AND THE VALUE OF THE SHARES I WILL RECEIVE CHANGE
BETWEEN NOW AND THE TIME THE MERGER IS COMPLETED?
A. The conversion ratio, which determines the number of shares you will receive,
will not change between now and the time the merger is completed. The value
of the shares you will receive may fluctuate between the date of this
information statement/prospectus and the completion of the merger, based upon
changes in the market price for Millennium Pharmaceuticals common stock. Any
fluctuation in the market price of Millennium Pharmaceuticals common stock
will change the value of the shares of Millennium Pharmaceuticals common
stock that you will receive.
Q. WHY IS THERE NO STOCKHOLDER VOTE?
A. Immediately after Millennium Pharmaceuticals, Millennium Predictive Medicine
and MPMx Acquisition Corp. signed the merger agreement, Millennium
Pharmaceuticals and Becton, Dickinson and Company gave their written consent
to the merger. Together, Millennium Pharmaceuticals and Becton Dickinson own
100% of the outstanding Millennium Predictive Medicine stock entitled to
vote on the merger. Their written consent to the merger met the stockholder
approval requirements for the merger under Delaware law, the Millennium
Predictive Medicine certificate of incorporation and the Millennium
Predictive Medicine bylaws, so no additional stockholder vote is necessary.
Q. WHAT RIGHTS DO I HAVE IF I THINK THE CONVERSION RATIO IS TOO LOW?
A. Under Delaware law, which governs the merger, you have the right to seek a
judicial determination of the value of your Millennium Predictive Medicine
stock. This is called an appraisal. For information on what this means, you
should read "Appraisal Rights of Dissenting Stockholders of Millennium
Predictive Medicine" on page 29.
Q. WHAT DO I NEED TO DO NOW?
A. Nothing, unless you intend to seek appraisal rights, in which case you should
follow the procedures described under "Appraisal Rights of Dissenting
Stockholders of Millennium Predictive Medicine" on page 29. After the merger
is completed, if you do not seek appraisal rights, you will receive
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written instructions and a letter of transmittal for converting your shares
of Millennium Predictive Medicine common stock and preferred stock into
shares of Millennium Pharmaceuticals common stock and receiving your cash
payment in place of any fraction of a share of Millennium Pharmaceuticals
common stock. Please do not send your share certificates until you receive
the instructions and letter of transmittal.
Q. IF I AM HOLDING ANY MILLENNIUM PREDICTIVE MEDICINE STOCK CERTIFICATES,
SHOULD I SEND THEM IN NOW?
A. No. As soon as practicable after the merger is completed, Millennium
Pharmaceuticals will send Millennium Predictive Medicine stockholders
written instructions for converting their share certificates, together with
a letter of transmittal for such certificates.
Q. WHEN DO YOU EXPECT TO COMPLETE THE MERGER?
A. We expect to complete the merger on the 20(th) business day after the date
this information statement/prospectus is mailed to the Millennium Predictive
Medicine stockholders. We expect that this will occur during the second
quarter of 2000.
Q. WILL THE SHARES OF MILLENNIUM PHARMACEUTICALS COMMON STOCK I RECEIVE IN
EXCHANGE FOR UNVESTED SHARES OF MILLENNIUM PREDICTIVE MEDICINE CLASS B
COMMON STOCK STILL BE SUBJECT TO REPURCHASE?
A. Yes. The terms of the stock restriction agreement you entered into with
Millennium Predictive Medicine that are applicable to shares of Millennium
Predictive Medicine held by you will continue to apply to shares of
Millennium Pharmaceuticals common stock you receive in exchange for those
shares. Any shares of Millennium Pharmaceuticals common stock issued in
exchange for unvested shares of Millennium Predictive Medicine Class B
common stock will be subject to repurchase by Millennium Pharmaceuticals in
the event you cease being an employee of Millennium Pharmaceuticals or one
of its subsidiaries. Shares of Millennium Pharmaceuticals common stock
issued in exchange for unvested shares of Millennium Predictive Medicine
Class B common stock will keep the same vesting schedule as the shares of
Millennium Predictive Medicine Class B common stock for which they were
exchanged.
Q. WHERE CAN I FIND MORE INFORMATION ABOUT MILLENNIUM PHARMACEUTICALS?
A. More information about Millennium Pharmaceuticals is available from various
sources described under "Where You Can Find More Information" on page 53.
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SUMMARY
This summary highlights selected information from this document and may not
contain all of the information that is important to you. To better understand
the merger and the issuance of shares of Millennium Pharmaceuticals common
stock, you should read carefully this entire document and the documents to which
we have referred you. See "Incorporation of Certain Documents by Reference." We
have sometimes included page references or section references to direct you to
more complete descriptions of the topics presented in this summary.
THE COMPANIES
MILLENNIUM PREDICTIVE MEDICINE, INC.
One Kendall Square, Building 700
Cambridge, MA 02140
(617) 679-7000
Millennium Predictive Medicine seeks to develop products and services that
will provide clinicians and pharmaceutical researchers with information that
enables them to make better informed decisions about drug treatment and other
aspects of patient management. Millennium Predictive Medicine is engaged in the
discovery and development of products and services in the areas of molecular
diagnostics, which we refer to as Diagnomics-TM-, pharmacogenomics and patient
management. A Diagnomics-TM- product is a gene-based diagnostic test to
determine the patient's medical status and facilitate cost-effective treatment.
Pharmacogenomics is the identification of genes, or their activity, associated
with responsiveness to particular drugs. To date, Millennium Predictive Medicine
has focused the majority of its efforts in the area of cancer Diagnomics-TM-,
through a collaboration with Becton, Dickinson and Company that began in
February 1999. In November 1999, Millennium Predictive Medicine entered into a
collaborative agreement with Bristol-Myers Squibb to discover and develop
products based on pharmacogenomic tests to be applied to certain classes of
drugs developed and marketed by Bristol-Myers Squibb in the field of oncology.
Millennium Pharmaceuticals owns approximately 89% of the voting shares of
Millennium Predictive Medicine, and Becton Dickinson owns all of the remaining
voting shares. Millennium Pharmaceuticals owns approximately 77% of the total
outstanding shares of Millennium Predictive Medicine.
MILLENNIUM PHARMACEUTICALS, INC.
75 Sidney Street
Cambridge, MA 02139
(617) 679-7000
Millennium Pharmaceuticals' goal is to become the biopharmaceutical company
of the future by building on its broad scientific and technological capabilities
and methods, which Millennium Pharmaceuticals calls its "technology platform,"
to develop breakthrough drugs.
We use many of the same elements of our technology platform throughout our
business, from the discovery of disease-related genes, to the development of
drugs to specifically address these diseases, to the management of patients
affected by these diseases. As a result, we speak of our technological approach
as being applicable from "gene to patient." We continually seek to expand our
technology platform in an effort to increase the speed of drug discovery and
development and improve the resulting drugs.
Millennium Pharmaceuticals has entered into research, development and
commercialization arrangements, which we call "strategic alliances," with major
pharmaceutical and biotechnology companies relating to a broad range of
therapeutic products. These alliances provide Millennium Pharmaceuticals with
the opportunity to receive royalties and profit sharing if it and its partners
are successful in developing and commercializing products. In addition, these
alliances provide substantial
3
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funding for Millennium Pharmaceuticals' research and development programs and
the continued enhancement of its technology platform.
Millennium Pharmaceuticals was organized as a Delaware corporation in 1993.
Millennium Pharmaceuticals' World Wide Web site address is www.mlnm.com. We do
not intend for this reference to our web site to constitute incorporation by
reference of the information contained at our web site.
REASONS FOR THE MERGER
Millennium Pharmaceuticals expects to benefit from the merger by enhancing
its ability to more closely align efforts in therapeutic drug discovery and
development with its efforts in predictive medicine. Millennium Pharmaceuticals
believes that its ability to pursue business opportunities, apply
pharmacogenomics broadly and develop external relationships with additional
pharmaceutical and other alliance partners will be enhanced by the merger.
The Board of Directors of Millennium Predictive Medicine, based on a
recommendation of its special committee, believes that the merger is fair to,
and in the best interests of, the Millennium Predictive Medicine stockholders.
For a description of the factors on which the board of directors and the special
committee based their determinations, see "Millennium Predictive Medicine's
Reasons for the Merger" on page 20.
NO FURTHER STOCKHOLDER APPROVAL REQUIRED; BOARD APPROVALS
We are not asking you to vote on the merger. On March 1, 2000, Millennium
Pharmaceuticals and Becton, Dickinson and Company, who on that date together
held 100% of the outstanding voting stock of Millennium Predictive Medicine,
voted by written consent to adopt the merger agreement and approve the merger.
Their vote was sufficient to authorize the merger under Delaware law, the
Millennium Predictive Medicine certificate of incorporation and the Millennium
Predictive Medicine bylaws.
On March 1, 2000, the board of directors of each of Millennium
Pharmaceuticals and Millennium Predictive Medicine unanimously adopted the
merger agreement and approved the merger.
THE MERGER
THE MERGER AGREEMENT (SEE PAGE 33)
Millennium Pharmaceuticals, Millennium Predictive Medicine and MPMx
Acquisition Corp. have entered into a merger agreement which provides that
Millennium Predictive Medicine will merge with and into MPMx Acquisition Corp.,
a wholly-owned subsidiary of Millennium Pharmaceuticals, with MPMx Acquisition
Corp. as the surviving company. Following the merger, MPMx Acquisition Corp.
will change its name to "Millennium Predictive Medicine."
THE MERGER AGREEMENT IS INCLUDED AS APPENDIX A TO THIS INFORMATION
STATEMENT/PROSPECTUS. IT IS THE LEGAL DOCUMENT THAT GOVERNS THE MERGER.
WHAT YOU WILL RECEIVE IN THE MERGER (SEE PAGE 33)
Unless you exercise your appraisal rights, each share of Millennium
Predictive Medicine common stock and preferred stock that you own will be
converted into 0.4 shares of Millennium Pharmaceuticals common stock. Millennium
Pharmaceuticals will not issue any fractional shares. Instead, each Millennium
Predictive Medicine stockholder who would otherwise have been entitled to
receive a fractional share of Millennium Pharmaceuticals common stock will
receive cash in place of that fractional share.
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REGULATORY APPROVALS
Except for filing a certificate of merger in Delaware and except for
compliance with federal and state securities laws, neither Millennium
Pharmaceuticals nor Millennium Predictive Medicine is aware of any material
United States federal or state or foreign governmental regulatory requirement
necessary to be complied with, or approval that must be obtained, in connection
with the Merger.
BACKGROUND OF THE MERGER (SEE PAGE 21)
In October 1999, Millennium Pharmaceuticals and Millennium Predictive
Medicine began discussions regarding a possible merger between them. In
December 1999, the board of directors of Millennium Predictive Medicine created
a special committee, consisting of a single disinterested director, to negotiate
terms with Millennium Pharmaceuticals and to make a recommendation to the board
regarding any proposed transaction. The special committee was advised by its own
legal counsel and engaged Deutsche Bank Securities Inc., also operating as
"Deutsche Banc Alex. Brown", to render an opinion to the special committee as to
the fairness, from a financial point of view, of the conversion ratio provided
for in the merger to the holders of Millennium Predictive Medicine common stock,
other than Millennium Pharmaceuticals. Negotiations continued through late
February 2000. On March 1, 2000, the special committee recommended to the board
of directors of Millennium Predictive Medicine that it approve the merger
agreement. At meetings held on March 1, 2000, the board of directors of
Millennium Pharmaceuticals and Millennium Predictive Medicine each approved the
merger agreement.
OPINION OF DEUTSCHE BANC ALEX. BROWN (SEE PAGE 22)
The Millennium Predictive Medicine special committee has received an opinion
of Deutsche Banc Alex. Brown as to the fairness, from a financial point of view,
of the conversion ratio provided for in the merger to the holders of Millennium
Predictive Medicine common stock other than Millennium Pharmaceuticals. The full
text of Deutsche Banc Alex. Brown's written opinion dated March 1, 2000 is
attached to the back of this document as Appendix B. We encourage you to read
this opinion carefully in its entirety for a description of the assumptions
made, matters considered and limitations on the review undertaken. DEUTSCHE BANC
ALEX. BROWN'S OPINION IS DIRECTED TO THE SPECIAL COMMITTEE AND DOES NOT
CONSTITUTE A RECOMMENDATION TO ANY STOCKHOLDER AS TO ANY MATTERS RELATING TO THE
MERGER.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES (SEE PAGE 27)
Millennium Pharmaceuticals and Millennium Predictive Medicine expect the
merger to be tax free to Millennium Predictive Medicine's stockholders (except
for tax payable on cash received by Millennium Predictive Medicine stockholders
instead of fractional shares of Millennium Pharmaceuticals common stock).
Millennium Pharmaceuticals and Millennium Predictive Medicine will each receive
an opinion of legal counsel that the merger will qualify as a reorganization
within the meaning of Section 368(a) of the Internal Revenue Code.
ACCOUNTING TREATMENT (SEE PAGE 28)
The merger, if completed, will be accounted for as an exchange of shares
between companies under common control and will result in the combination of the
recorded book values of the assets, liabilities and shareholders' equity of
Millennium Pharmaceuticals and Millennium Predictive Medicine.
APPRAISAL RIGHTS OF DISSENTING STOCKHOLDERS OF MILLENNIUM PREDICTIVE MEDICINE
(SEE PAGE 29)
IF YOU OBJECT TO THE MERGER, DELAWARE LAW PERMITS YOU TO SEEK RELIEF AS A
DISSENTING STOCKHOLDER AND HAVE THE "FAIR VALUE" OF YOUR SHARES OF MILLENNIUM
PREDICTIVE MEDICINE COMMON STOCK AND PREFERRED STOCK DETERMINED BY A COURT AND
PAID TO YOU IN CASH.
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This information statement/prospectus constitutes a notice of appraisal
rights. If you are a Millennium Predictive Medicine stockholder and wish to
dissent, you must deliver to Millennium Pharmaceuticals within twenty days from
the date of mailing of this information statement/prospectus a written demand
for appraisal of your shares.
The relevant provisions of Delaware law are technical in nature and complex.
If you wish to exercise appraisal rights and obtain appraisal of the fair value
of your shares, you may wish to consult with legal counsel because the failure
to comply strictly with these provisions may result in waiver or forfeiture of
your appraisal rights.
A COPY OF THE RELEVANT SECTION OF DELAWARE LAW GOVERNING THIS PROCESS IS
ATTACHED AS APPENDIX C TO THIS INFORMATION STATEMENT/PROSPECTUS.
WHAT IS NEEDED TO COMPLETE THE MERGER (SEE PAGE 36)
A few limited conditions must be satisfied before the merger will be
completed. These include:
- receipt by Millennium Pharmaceuticals and Millennium Predictive Medicine
of an opinion of tax counsel that for U.S. federal income tax purposes,
the merger will constitute a reorganization under Section 368(a) of the
Internal Revenue Code; and
- other customary contractual conditions specified in the merger agreement.
TERMINATION OF THE MERGER AGREEMENT (SEE PAGE 37)
Millennium Pharmaceuticals and Millennium Predictive Medicine may agree to
terminate the merger agreement without completing the merger. In addition,
either party may terminate the merger agreement if the other party has breached
the agreement and not cured its breach or if the merger has not been completed
by December 31, 2000.
AMENDMENT AND WAIVER OF THE MERGER AGREEMENT (SEE PAGE 37)
Millennium Pharmaceuticals and Millennium Predictive Medicine may agree to
amend the merger agreement prior to the time the merger becomes effective,
subject to applicable law. Either of us can waive our right to require the other
party to adhere to the terms and conditions of the merger agreement, if the law
allows, at any time prior to the time the merger becomes effective. In order for
Millennium Predictive Medicine to amend, or waive any of its rights under, the
merger agreement, the special committee of Millennium Predictive Medicine's
board of directors must recommend such amendment or waiver and the Millennium
Predictive Medicine's board of directors must approve such amendment or waiver.
COMPARISON OF STOCKHOLDER RIGHTS (SEE PAGE 47)
If you own Millennium Predictive Medicine common stock or preferred stock,
unless you exercise your appraisal rights, you will become a stockholder of
Millennium Pharmaceuticals upon completion of the merger. Your rights will then
be governed by Millennium Pharmaceuticals' certificate of incorporation and
bylaws, rather than Millennium Predictive Medicine' certificate of incorporation
and bylaws. Your rights as a stockholder of Millennium Pharmaceuticals will
differ from your rights as a stockholder of Millennium Predictive Medicine. To
review these differences in more detail, see "Comparison of Stockholder Rights"
on page 47.
RECENT DEVELOPMENTS WITH RESPECT TO MILLENNIUM PHARMACEUTICALS
On January 31, 2000, Millennium Pharmaceuticals' board of directors voted to
recommend to its stockholders that its corporate charter be amended to increase
the authorized number of shares of
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common stock from 100,000,000 shares to 500,000,000 shares. In addition, on
January 31, 2000, Millennium Pharmaceuticals' board of directors adopted,
subject to stockholder approval, its 2000 Stock Incentive Plan. The 2000 Stock
Incentive Plan permits the issuance of stock-based awards for a number of shares
equal to 5% of the number of shares of Millennium Pharmaceuticals' common stock
outstanding on April 12, 2000, plus an annual increase equal to the lesser of 5%
of the number of shares of its common stock outstanding on the last business day
preceding January 1 in each of 2001, 2002 and 2003 or a lesser number determined
by the board of directors. These proposals were approved at Millennium
Pharmaceuticals' annual meeting of stockholders held on April 12, 2000.
On February 28, 2000, Millennium Pharmaceuticals' board of directors
approved a two-for-one split of its common stock in the form of a stock
dividend. The record date for this dividend was March 28, 2000, and the dividend
distribution date was April 18, 2000.
On March 6, 2000, Millennium Pharmaceuticals entered into an agreement with
Abgenix, Inc. which provides it with access to Abgenix's XenoMouse-TM-
technology for the creation of fully human antibodies. Under this agreement,
Millennium Pharmaceuticals will have broad access to the XenoMouse-TM-
technology for research purposes as well as commercial use. Millennium
Pharmaceuticals has agreed to make an upfront payment and future payments that
could reach $100 million plus royalties on product sales for which it will
receive a specified number of commercial licenses.
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RISK FACTORS
YOU SHOULD CONSIDER CAREFULLY THE FOLLOWING RISKS, ALONG WITH THE OTHER
INFORMATION CONTAINED OR INCORPORATED BY REFERENCE IN THIS INFORMATION
STATEMENT/PROSPECTUS. THE RISKS AND UNCERTAINTIES DESCRIBED BELOW ARE NOT THE
ONLY ONES AFFECTING MILLENNIUM PHARMACEUTICALS AND MILLENNIUM PREDICTIVE
MEDICINE. ADDITIONAL RISKS AND UNCERTAINTIES MAY ALSO ADVERSELY AFFECT
MILLENNIUM PHARMACEUTICALS' AND MILLENNIUM PREDICTIVE MEDICINE'S BUSINESS AND
OPERATIONS. IF ANY OF THE FOLLOWING EVENTS ACTUALLY OCCURS, MILLENNIUM
PHARMACEUTICALS' AND/OR MILLENNIUM PREDICTIVE MEDICINE'S BUSINESS, FINANCIAL
CONDITION AND RESULTS OF OPERATIONS WOULD LIKELY SUFFER, POSSIBLY MATERIALLY.
THE TERMS "WE", "OUR" AND "US" WHEN USED IN THIS SECTION CAPTIONED "RISK
FACTORS" MEAN MILLENNIUM PHARMACEUTICALS AND MILLENNIUM PREDICTIVE MEDICINE.
REGULATORY RISKS
WE HAVE NOT YET RECEIVED MARKETING APPROVAL FOR ANY PRODUCT OR SERVICE RESULTING
FROM OUR DEVELOPMENT EFFORTS AND MAY NOT BE ABLE TO OBTAIN ANY SUCH APPROVAL.
We have completed development of only one product candidate,
CAMPATH-Registered Trademark- monoclonal antibody, which we developed in our
partnership with Ilex Oncology, Inc. This partnership only recently applied to
the U.S. Food and Drug Administration for approval to market this product. It is
possible that the FDA will not grant this marketing approval. As of March 31,
2000, we and our alliance partners were conducting clinical trials of six
product candidates resulting from our research and development programs,
including clinical trails of CAMPATH-Registered Trademark- monocolonal antibody,
and preclinical testing of approximately ten product candidates resulting from
these programs.
All of the products that we are developing will require additional research
and development, extensive preclinical studies and clinical trials and
regulatory approval prior to any commercial sales. This process is lengthy,
often taking a number of years, and expensive. In some cases, the length of time
that it takes for us to achieve various regulatory approval milestones affects
the payments that we are eligible to receive under our strategic alliance
agreements.
We may need to successfully address a number of technological challenges in
order to complete development of our products. Moreover, these products may not
be effective in treating any disease or may prove to have undesirable or
unintended side effects, toxicities or other characteristics that may preclude
our obtaining regulatory approval or prevent or limit commercial use.
WE HAVE ONLY LIMITED EXPERIENCE IN REGULATORY AFFAIRS, AND SOME OF OUR PRODUCTS
MAY BE BASED ON NEW TECHNOLOGIES; THESE FACTORS MAY AFFECT OUR ABILITY OR THE
TIME WE REQUIRE TO OBTAIN NECESSARY REGULATORY APPROVALS
We have only limited experience in filing and prosecuting applications
necessary to gain regulatory approvals, which may affect our ability to obtain
these approvals. Moreover, certain of the products that are likely to result
from our research and development programs may be based on new technologies and
new therapeutic approaches that have not been extensively tested in humans. The
regulatory requirements governing these types of products may be more rigorous
than for conventional products. As a result, we may experience a longer
regulatory process in connection with any products that we develop based on
these new technologies or new therapeutic approaches.
RISKS RELATING TO OUR INDUSTRY, BUSINESS AND STRATEGY
BECAUSE THE GENOMICS INDUSTRY IS NEW, IT IS POSSIBLE THAT THE DISCOVERIES AND
TECHNOLOGY ON WHICH THIS INDUSTRY IS BASED WILL NOT RESULT IN COMMERCIAL
PRODUCTS OR SERVICES
The genomics industry is new and evolving rapidly. We focus our genomics
research primarily on diseases that may be linked to several or many genes
working in combination. Both we and the general scientific and medical
communities have only a limited understanding relating to the role of genes and
8
<PAGE>
their products in these diseases. To date, we have not commercialized any
products or services, and we may not be successful in doing so in the future. In
addition, relatively few products based on gene discoveries have been developed
and commercialized by others. Rapid technological development by us or others
may result in compounds, products or processes becoming obsolete before we
recover our development expenses.
OUR PLAN TO GROW THROUGH ACQUISITIONS OF OTHER COMPANIES WILL NOT BE SUCCESSFUL
IF WE ARE UNABLE TO INTEGRATE ACQUIRED COMPANIES WITH OUR OTHER OPERATIONS OR IF
THE TECHNOLOGY OR PERSONNEL OF ACQUIRED COMPANIES DO NOT MEET OUR EXPECTATIONS
Millennium Pharmaceuticals completed its merger with LeukoSite on
December 22, 1999. Millennium Pharmaceuticals may not be able to successfully
integrate or profitably manage LeukoSite's business. In addition, the
combination of Millennium Pharmaceuticals' business with LeukoSite's may not
achieve revenues, net income or loss levels, efficiencies or synergies that
justify the merger. The combined company may experience slower rates of growth
as compared to the historical rates of growth of Millennium Pharmaceuticals and
LeukoSite independently. Millennium Pharmaceuticals plans to make additional
acquisitions in the future, which will entail similar risks.
COMPETITION FOR SCIENTIFIC AND MANAGERIAL PERSONNEL IN OUR INDUSTRY IS INTENSE;
WE WILL NOT BE ABLE TO SUSTAIN OUR OPERATIONS AND GROW IF WE ARE NOT ABLE TO
ATTRACT AND RETAIN KEY PERSONNEL
Our success substantially depends on the ability, experience and performance
of our senior management and other key personnel. If we lose one or more of the
members of our senior management or other key employees, our business and
operating results could be seriously harmed.
In addition, our future success will depend heavily on our ability to
continue to hire, train, retain and motivate additional skilled managerial and
scientific personnel. The pool of personnel with the skills that we require is
limited. Competition to hire from this limited pool is intense.
The stock options held by LeukoSite employees became fully vested upon the
closing of our acquisition of LeukoSite. This acceleration may adversely affect
our ability to retain former LeukoSite employees.
WE FACE SUBSTANTIAL COMPETITION, WHICH MAY RESULT IN OTHERS DISCOVERING,
DEVELOPING OR COMMERCIALIZING PRODUCTS AND SERVICES BEFORE OR MORE SUCCESSFULLY
THAN WE DO
The fields of genomics, biotechnology and pharmaceuticals are highly
competitive. Many of our competitors are substantially larger than we are and
have substantially greater capital resources, research and development staffs
and facilities than we have. Furthermore, many of our competitors are more
experienced than we are in drug discovery, development and commercialization,
obtaining regulatory approvals and product manufacturing and marketing. As a
result, our competitors may identify genes associated with diseases or discover,
develop and commercialize products or services based on such genes before we do.
In addition, our competitors may discover, develop and commercialize products or
services which render non-competitive or obsolete the products or services that
we or our strategic alliance partners are seeking to develop and commercialize.
WE MAY NOT BE ABLE TO OBTAIN BIOLOGICAL MATERIAL, INCLUDING HUMAN AND ANIMAL DNA
SAMPLES, REQUIRED FOR OUR GENETIC STUDIES, WHICH COULD DELAY OR IMPEDE OUR DRUG
DISCOVERY EFFORTS
Our gene identification strategy includes genetic studies of families and
populations prone to particular diseases. These studies require the collection
of large numbers of DNA samples from affected individuals, their families and
other suitable populations as well as animal models. The availability of DNA
samples and other biological material is important to our ability to discover
the genes responsible for human diseases through human genetic approaches and
other studies. Competition for these resources is intense. Access to suitable
populations, materials and samples could be limited by forces beyond our
control, including governmental actions. Some of our competitors may
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have obtained access to significantly more family and population resources and
biological materials than we have obtained. As a result, we may not be able to
obtain access to DNA samples necessary to support our human gene discovery
programs.
RISKS RELATING TO OUR FINANCIAL RESULTS AND NEED FOR FINANCING
WE HAVE INCURRED SUBSTANTIAL LOSSES, WE EXPECT TO CONTINUE TO INCUR LOSSES AND
WE WILL NOT BE SUCCESSFUL UNLESS WE REVERSE THIS TREND
Millennium Pharmaceuticals has incurred losses in four of the last six
years, including in the year ended December 31, 1999. Millennium Pharmaceuticals
expects to continue to incur substantial operating losses in future periods.
Millennium Predictive Medicine has incurred losses in each year since the date
of its inception. To date, substantially all of our revenues have resulted from
payments from strategic alliance partners. We have not received any revenues
from the sale of products or clinical or diagnostic services.
We expect to increase our spending significantly as we continue to expand
our infrastructure, research and development programs and commercialization
activities. As a result, we will need to generate significant revenues to pay
these costs and achieve profitability. We cannot be certain whether or when we
will become profitable because of the significant uncertainties with respect to
our ability to generate revenues from the sale of products and services and from
existing and potential future strategic alliances.
MILLENNIUM PHARMACEUTICALS' SUBSTANTIAL INDEBTEDNESS MAY ADVERSELY AFFECT ITS
CASH FLOW AND OPERATIONS AND BE DIFFICULT FOR IT TO REPAY, WHICH COULD ADVERSELY
AFFECT THE VALUE OF YOUR INVESTMENT IN MILLENNIUM PHARMACEUTICALS
Millennium Pharmaceuticals has substantial amounts of outstanding
indebtedness, primarily its 5.50% convertible subordinated notes due
January 15, 2007. Millennium Pharmaceuticals also may obtain additional long
term debt and working capital lines of credit. As a result of this indebtedness,
Millennium Pharmaceuticals' principal and interest payment obligations are
substantial. Under the terms of our indebtedness and capital lease lines
outstanding as of March 31, 2000, we are required to make total principal
payments of $7,265,207 and interest payments of $19,022,129 to our lenders in
2000. There is the possibility that Millennium Pharmaceuticals may be unable to
generate cash sufficient to pay the principal of, interest on and other amounts
due in respect of its indebtedness when due. In particular, Millennium
Pharmaceuticals may require funds from external sources, such as new borrowings,
to repay its 5.50% convertible subordinated notes when their entire principal
amounts become due in a single payment on their maturity date.
Millennium Pharmaceuticals' substantial leverage could have significant
negative consequences, including:
- increasing our vulnerability to general adverse economic and industry
conditions;
- limiting our ability to obtain additional financing;
- requiring the dedication of a substantial portion of our cash from
operations to service our indebtedness, thereby reducing the amount of our
cash available for other purposes, including capital expenditures;
- limiting our flexibility in planning for, or reacting to, changes in our
business and the industry in which we compete; and
- placing us at a possible competitive disadvantage vis-a-vis less leveraged
competitors and competitors that have better access to capital resources.
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It is likely that we will require funds from external sources, such as a new
loan facility, in order to repay its outstanding notes.
WE MAY NEED ADDITIONAL FINANCING, WHICH MAY BE DIFFICULT TO OBTAIN; OUR FAILURE
TO OBTAIN NECESSARY FINANCING OR DOING SO ON UNATTRACTIVE TERMS COULD ADVERSELY
AFFECT OUR DISCOVERY AND DEVELOPMENT PROGRAMS AND OTHER OPERATIONS
We will require substantial funds to conduct research and development,
including preclinical testing and clinical trials of our potential products,
meet our obligations to our strategic alliance partners, manufacture and market
any products and services that are approved for commercial sale and meet our
debt service obligations. Additional financing may not be available when we need
it or may not be available on terms that are favorable to us.
If we are unable to obtain adequate funding on a timely basis, we may be
required to significantly curtail one or more of our discovery or development
programs. We could be required to seek funds through arrangements with
collaborative partners or others that may require us to relinquish rights to
certain of our technologies, product candidates or products which we would
otherwise pursue on our own.
RISKS RELATING TO STRATEGIC ALLIANCE PARTNERS
WE DEPEND SIGNIFICANTLY ON OUR STRATEGIC ALLIANCE PARTNERS TO DEVELOP AND
COMMERCIALIZE PRODUCTS AND SERVICES BASED ON OUR WORK; OUR BUSINESS MAY SUFFER
IF ANY OF OUR STRATEGIC ALLIANCE PARTNERS BREACHES ITS AGREEMENT OR FAILS TO
SUPPORT OR TERMINATES ITS ALLIANCE WITH US
We conduct most of our discovery and development activities through
strategic alliances. The success of these programs depends heavily on the
efforts and activities of our strategic alliance partners. Each of our alliance
partners has significant discretion in determining the efforts and resources
that they will apply to the alliance. Our existing and any future alliances may
not be scientifically or commercially successful.
The risks that we face in connection with these alliances include:
- All of our strategic alliance agreements are subject to termination under
various circumstances, including in many cases on short notice without
cause.
- In our strategic alliance agreements, we generally agree not to conduct
specified types of research and development in the field that is the
subject of the alliance. These agreements may have the effect of limiting
the areas of research and development we may pursue, either alone or in
collaboration with third parties.
- Our alliance partners may develop and commercialize, either alone or with
others, products and services that are similar to or competitive with the
products and services that are the subject of the alliance with us.
- Our alliance partners may change the focus of their development and
commercialization efforts. Pharmaceutical and biotechnology companies
historically have re-evaluated their priorities following mergers and
consolidations, which have been common in recent years in these
industries.
- We will rely on our alliance partners to manufacture most products covered
by our alliances. For example, Becton Dickinson has the sole right to
manufacture the Melastatin-TM- detection product.
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WE MAY NOT BE SUCCESSFUL IN ESTABLISHING ADDITIONAL STRATEGIC ALLIANCES, WHICH
COULD ADVERSELY AFFECT OUR ABILITY TO DEVELOP AND COMMERCIALIZE PRODUCTS
An important element of our business strategy is entering into strategic
alliances for the development and commercialization of products and services
based on our discoveries. We face significant competition in seeking appropriate
alliance partners. Moreover, these alliance arrangements are complex to
negotiate and time-consuming to document. We may not be successful in our
efforts to establish additional strategic alliances or other alternative
arrangements. The terms of any additional strategic alliances or other
arrangements that we establish may not be favorable to us. Moreover, such
strategic alliances or other arrangements may not be successful.
RISKS RELATING TO INTELLECTUAL PROPERTY
IF WE ARE UNABLE TO OBTAIN PATENT PROTECTION FOR OUR DISCOVERIES, THE VALUE OF
OUR TECHNOLOGY AND PRODUCTS WILL BE ADVERSELY AFFECTED; IF WE INFRINGE PATENT OR
OTHER INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES, WE MAY NOT BE ABLE TO
DEVELOP AND COMMERCIALIZE OUR PRODUCTS AND SERVICES OR THE COST OF DOING SO MAY
INCREASE
Our patent positions, and those of other pharmaceutical and biotechnology
companies, are generally uncertain and involve complex legal, scientific and
factual questions.
Our ability to develop and commercialize products and services depends in
significant part on our ability to:
- Obtain patents;
- Obtain licenses to the proprietary rights of others on commercially
reasonable terms;
- Operate without infringing upon the proprietary rights of others;
- Prevent others from infringing on our proprietary rights; and
- Protect trade secrets.
If we are unable to obtain patent protection for our discoveries or are
unsuccessful in preventing others from infringing on our proprietary rights, the
value of our technology and products will be adversely affected. If we infringe
patent or other intellectual property rights of third parties, we may not be
able to develop and commercialize our products and services or we may be
required to pay substantial fees or royalties to do so.
THERE IS SIGNIFICANT UNCERTAINTY ABOUT THE VALIDITY AND PERMISSABLE SCOPE OF
GENOMICS PATENTS IN OUR INDUSTRY, WHICH MAY MAKE IT DIFFICULT FOR US TO OBTAIN
PATENT PROTECTION FOR OUR DISCOVERIES
The validity and permissable scope of patent claims in the pharmaceutical
and biotechnology fields, including the genomics field, involve important
unresolved legal principles and are the subject of public policy debate in the
United States and abroad. For example, there is significant uncertainty both in
the United States and abroad regarding the patentability of gene sequences in
the absence of functional data and the scope of patent protection available for
full-length genes and partial gene sequences. Moreover, certain groups have made
certain gene sequences available in publicly accessible databases. These and
other disclosures may adversely affect our ability to obtain patent protection
for gene sequences claimed by us in patent applications that we file subsequent
to such disclosures. There is also some uncertainty as to whether human clinical
data will be required for issuance of patents for human therapeutics. If such
data are required, our ability to obtain patent protection could be delayed or
otherwise adversely affected.
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THIRD PARTIES MAY OWN OR CONTROL PATENTS OR PATENT APPLICATIONS AND REQUIRE US
TO SEEK LICENSES, WHICH COULD INCREASE OUR DEVELOPMENT AND COMMERCIALIZATION
COSTS, OR PREVENT US FROM DEVELOPING OR MARKETING PRODUCT OR SERVICE CANDIDATES
We may not have rights under some patents or patent applications related to
our proposed products, processes or services. Third parties may own or control
these patents and patent applications in the United States and abroad.
Therefore, in some cases, such as those detailed below, to develop, manufacture,
sell or import certain of our proposed products, processes or services, we or
our alliance partners may choose to seek or be required to seek licenses under
third party patents issued in the United States and abroad or those which might
issue from United States and foreign patent applications. In such event, we
would be required to pay license fees or royalties or both to the licensor. If
licenses are not available to us on acceptable terms, we or our alliance
partners may not be able to develop, manufacture, sell or import these products,
processes or services.
With respect to Millennium Pharmaceuticals' product candidate LDP-01, we are
aware of third party patents and patent applications which relate to certain
anti-CD18 antibodies and their use in various methods of treatment including
methods of reperfusion therapy and methods of treating focal ischemic stroke. In
addition, Millennium Pharmaceuticals' LDP-01, LDP-02 and
CAMPATH-Registered Trademark- monoclonal antibody product candidates are
humanized monoclonal antibodies. We are aware of third party patents and patent
applications which relate to certain humanized or modified antibodies, products
useful for making humanized or modified antibodies, and processes for making and
using humanized or modified antibodies. We are also aware of third party patents
and patent applications relating to certain manufacturing processes, products
thereof and materials useful in such processes.
Millennium Pharmaceuticals' product candidates LDP-977, LDP-341, and LDP-519
are all small molecule drug candidates. With respect to LDP-341, we are aware of
third party patents or patent applications which relate to either intermediates
or synthetic processes used in the synthesis of these compounds. Additionally,
for the use of LDP-341 and LDP-519 in the treatment of infarctions we are aware
of the existence of a potentially interfering patent application filed by one of
our former consultants.
WE MAY BECOME INVOLVED IN EXPENSIVE PATENT LITIGATION OR OTHER PROCEEDINGS,
WHICH COULD RESULT IN OUR INCURRING SUBSTANTIAL COSTS AND EXPENSES OR
SUBSTANTIAL LIABILITY FOR DAMAGES OR REQUIRE US TO STOP OUR DEVELOPMENT AND
COMMERCIALIZATION EFFORTS
There has been substantial litigation and other proceedings regarding the
patent and other intellectual property rights in the pharmaceutical and
biotechnology industries. We may become a party to patent litigation or other
proceedings regarding intellectual property rights. For example, we believe that
we hold patent applications that cover genes that are also claimed in patent
applications filed by others. Interference proceedings before the United States
Patent and Trademark Office may be necessary to establish which party was the
first to invent these genes.
The cost to us of any patent litigation or other proceeding, even if
resolved in our favor, could be substantial. Some of our competitors may be able
to sustain the cost of such litigation or proceedings more effectively than we
can because of their substantially greater financial resources. If a patent
litigation or other proceeding is resolved against us, we or our alliance
partners may be enjoined from developing, manufacturing, selling or importing
our products, processes or services without a license from the other party and
we may be held liable for significant damages. We may not be able to obtain any
required license on commercially acceptable terms or at all.
Uncertainties resulting from the initiation and continuation of patent
litigation or other proceedings could have a material adverse effect on our
ability to compete in the marketplace. Patent litigation and other proceedings
may also absorb significant management time.
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RISKS RELATING TO PRODUCT MANUFACTURING, MARKETING AND SALES
BECAUSE MANY OF THE PRODUCTS AND SERVICES THAT WE DEVELOP WILL BE BASED ON NEW
TECHNOLOGIES AND THERAPEUTIC APPROACHES, THE MARKET MAY NOT BE RECEPTIVE TO
THESE PRODUCTS AND SERVICES UPON THEIR INTRODUCTION
The commercial success of our products and services that are approved for
marketing will depend upon their acceptance by the medical community and third
party payors as clinically useful, cost effective and safe. Many of the products
and services that we are developing are based upon new technologies or
therapeutic approaches. As a result, it may be more difficult for us to achieve
market acceptance of our products and services, particularly the first products
and services that we introduce to the market based on new technologies and
therapeutic approaches.
BECAUSE WE HAVE NO SALES, MARKETING OR DISTRIBUTION EXPERIENCE AND CAPABILITIES,
WE WILL BE DEPENDENT ON THIRD PARTIES TO SUCCESSFULLY PERFORM THESE FUNCTIONS OR
WILL BE REQUIRED TO INCUR SIGNIFICANT COSTS AND DEVOTE SIGNIFICANT EFFORTS TO
DEVELOP THESE CAPABILITIES
We have no sales, marketing or distribution experience and capabilities. We
plan to rely significantly on sales, marketing and distribution arrangements
with our strategic alliance partners and other third parties for the products
and services that we are developing. For example, Millennium Pharmaceuticals'
partnership that holds CAMPATH-Registered Trademark- monoclonal antibody will
rely solely upon Schering AG and its U.S. affiliate, Berlex Laboratories, for
the marketing, distribution and sale of the CAMPATH-Registered Trademark-
monoclonal antibody product throughout the world other than the Far East.
If in the future we determine to perform sales, marketing and distribution
functions ourselves, we would face a number of additional risks, including the
need to recruit experienced marketing and sales personnel.
BECAUSE WE HAVE LIMITED MANUFACTURING CAPABILITIES, WE WILL BE DEPENDENT ON
THIRD PARTY MANUFACTURERS TO MANUFACTURE PRODUCTS FOR US OR WILL BE REQUIRED TO
INCUR SIGNIFICANT COSTS AND DEVOTE SIGNIFICANT EFFORTS TO ESTABLISH OUR OWN
MANUFACTURING FACILITIES AND CAPABILITIES
We have limited manufacturing experience and no commercial scale
manufacturing capabilities. In order to continue to develop products and
services, apply for regulatory approvals and, ultimately, commercialize any
products and services, we will need to develop, contract for or otherwise
arrange for the necessary manufacturing capabilities.
We currently rely upon third parties to produce material for preclinical
testing purposes and expect to continue to do so in the future. We also expect
to rely upon other third parties, including our strategic alliance partners, to
produce materials required for clinical trials and for the commercial production
of certain of our products if we succeed in obtaining necessary regulatory
approvals. Millennium Pharmaceuticals' partnership with ILEX Oncology relies on
Boehringer Ingleheim as the sole source manufacturer of
CAMPATH-Registered Trademark- monoclonal antibody.
There are a limited number of manufacturers that operate under the FDA's
good manufacturing practices regulations capable of manufacturing for us. As a
result, we have experienced some difficulty finding manufacturers for our
products with adequate capacity for our anticipated future needs. If we are
unable to arrange for third party manufacturing of our products, or to do so on
commercially reasonable terms, we may not be able to complete development of our
products or market them.
Reliance on third party manufacturers entails risks to which we would not be
subject if we manufactured products ourselves, including reliance on the third
party for regulatory compliance and quality assurance, the possibility of breach
of the manufacturing agreement by the third party because of factors beyond our
control and the possibility of termination or nonrenewal of the agreement by the
third party, based on its own business priorities, at a time that is costly or
inconvenient for us.
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We may in the future determine to manufacture certain of our products in our
own manufacturing facilities. We will require substantial additional funds and
need to recruit qualified personnel in order to build or lease and operate any
manufacturing facilities.
IF WE FAIL TO OBTAIN AN ADEQUATE LEVEL OF REIMBURSEMENT FOR OUR FUTURE PRODUCTS
OR SERVICES BY THIRD PARTY PAYORS, THERE MAY BE NO COMMERCIALLY VIABLE MARKETS
FOR OUR PRODUCTS OR SERVICES
The availability and levels of reimbursement by governmental and other third
party payors affects the market for any pharmaceutical product or healthcare
service. These third party payors continually attempt to contain or reduce the
costs of healthcare by challenging the prices charged for medical products and
services. In certain foreign countries, particularly the countries of the
European Union, the pricing of prescription pharmaceuticals is subject to
governmental control. We may not be able to sell our products and services
profitably if reimbursement is unavailable or limited in scope or amount.
In both the United States and certain foreign jurisdictions, there have been
a number of legislative and regulatory proposals to change the healthcare
system. Further proposals are likely. The potential for adoption of these
proposals affects or will affect our ability to raise capital, obtain additional
collaborative partners and market our products.
If we or our alliance partners obtain marketing approvals for our products
and services, we expect to experience pricing pressure due to the trend toward
managed health care, the increasing influence of health maintenance
organizations and additional legislative proposals.
ETHICAL, LEGAL AND SOCIAL ISSUES RELATED TO GENETIC TESTING MAY CAUSE OUR
DIAGNOSTIC PRODUCTS TO BE REJECTED BY CUSTOMERS OR PROHIBITED OR CURTAILED BY
GOVERNMENTAL AUTHORITIES
Diagnostic tests that evaluate genetic predisposition to disease raise
issues regarding the use and confidentiality of the information provided by such
tests. Insurance carriers and employers might discriminate on the basis of such
information, resulting in a significant barrier to the acceptance of such tests
by customers. This type of discrimination could cause governmental authorities
to prohibit or limit the use of such tests.
RISKS RELATING TO AN INVESTMENT IN MILLENNIUM PHARMACEUTICALS COMMON STOCK
MILLENNIUM PHARMACEUTICALS HAS ANTI-TAKEOVER DEFENSES THAT COULD DELAY OR
PREVENT A TAKEOVER THAT STOCKHOLDERS MAY CONSIDER FAVORABLE.
Provisions of Millennium Pharmaceuticals' certificate of incorporation and
bylaws and of Delaware law could have the effect of delaying, deferring or
preventing an acquisition of Millennium Pharmaceuticals. For example, Millennium
Pharmaceuticals has divided its board of directors into three classes that serve
staggered three-year terms, Millennium Pharmaceuticals may authorize the
issuance of up to 5,000,000 shares of "blank check" preferred stock, its
stockholders may not take actions by written consent and its stockholders are
limited in their ability to make proposals at stockholder meetings.
MILLENNIUM PHARMACEUTICALS STOCK PRICE COULD BE VOLATILE, WHICH COULD CAUSE YOU
TO LOSE PART OR ALL OF YOUR INVESTMENT
The market price of our common stock, like that of the common stock of many
other biotechnology companies, may be highly volatile. Factors such as:
- announcements of technological innovations or new commercial products by
us or our competitors,
- disclosure of results of clinical testing or regulatory proceedings,
- governmental regulation and approvals,
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- developments in patent or other proprietary rights, including as a result
of any public policy concerns,
- public concern as to the safety of products developed by us,
- our financial results, and
- general market conditions
may have a significant effect on the market price of our common stock. In
addition, the stock market has experienced extreme price and volume
fluctuations. The volatility has significantly affected the market prices of
securities of many biotechnology and pharmaceutical companies for reasons
frequently unrelated to or disproportionate to the operating performance of the
specific companies. These broad market fluctuations may adversely affect the
market price of our common stock.
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MILLENNIUM PHARMACEUTICALS SELECTED FINANCIAL DATA
The following selected financial data for the five-year period ended
December 31, 1999 are derived from the audited financial statements of
Millennium Pharmaceuticals. The data should be read in conjunction with the
financial statements, related notes and other financial information included or
incorporated by reference herein. See "Where You Can Find More Information."
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------------------------
1995 1996 1997 1998 1999
-------- -------- -------- -------- ---------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
Consolidated Statement of Operations Data
Revenue under strategic alliances........... $22,880 $31,764 $ 89,933 $133,682 $ 183,679
Costs and expenses:
Research and development.................. 17,838 34,803 74,828 114,190 159,877
General and administrative................ 3,292 7,973 16,517 24,419 32,896
Acquired in-process R&D................... -- -- 83,800 -- 350,503
Amortization of intangible asset.......... -- -- 2,397 2,702 3,816
------- ------- -------- -------- ---------
21,130 42,776 177,542 141,311 547,092
------- ------- -------- -------- ---------
Income (loss) from operations............... 1,750 (11,012) (87,609) (7,629) (363,413)
Interest income (expense), net.............. (466) 2,244 2,977 3,788 9,473
Minority interest........................... -- -- 3,410 14,179 1,980
------- ------- -------- -------- ---------
Net income (loss)........................... $ 1,284 $(8,768) $(81,222) $ 10,338 $(351,960)
======= ======= ======== ======== =========
Basic net income (loss) per share (pro forma
in 1995 and 1996)......................... $ 0.05 $ (0.20) $ (1.43) $ 0.17 $ (5.23)
Shares used in computing basic net income
(loss) per share.......................... 27,704 43,394 56,646 60,638 72,706
Diluted net income (loss) per share (pro
forma in 1995 and 1996)................... $ 0.04 $ (0.20) $ (1.43) $ 0.16 $ (5.23)
Shares used in computing diluted net income
(loss) per share.......................... 35,708 43,394 56,646 63,016 72,706
</TABLE>
<TABLE>
<CAPTION>
AS OF DECEMBER 31,
-----------------------------------------------------
1995 1996 1997 1998 1999
-------- -------- -------- -------- ---------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Consolidated Balance Sheet Data
Cash, cash equivalents and marketable
securities................................ $17,847 $63,848 $ 96,557 $190,964 $ 261,716
Total assets................................ 25,105 87,744 144,513 257,954 541,625
Long-term debt, net of current portion...... 1,467 -- -- -- --
Capital lease obligation, net of current
portion................................... 2,499 9,308 19,809 24,827 27,488
Stockholders' equity........................ 13,096 66,639 91,755 206,362 439,406
</TABLE>
COMPARATIVE PER SHARE DATA
Set forth below are earnings and book value per share data for Millennium
Pharmaceuticals on both historical and pro forma bases.
- Book value per share for the pro forma combined presentation is based upon
outstanding shares of Millennium Pharmaceuticals common stock, adjusted to
include shares of Millennium
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Pharmaceuticals common stock assumed to be issued in the merger for
outstanding shares of Millennium Predictive Medicine common stock and
preferred stock.
- The information set forth below should be read in conjunction with the
audited historical financial statements of Millennium Pharmaceuticals
incorporated by reference in this information statement/prospectus.
<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31, 1999
-----------------
<S> <C>
Millennium Pharmaceuticals--Historical
Income (loss) per common share:
Basic..................................................... $ (5.23)
Diluted................................................... $ (5.23)
Book value per share at period end........................ $ 4.92
Millennium Pharmaceuticals/Millennium Predictive Medicine--
Pro Forma Combined
Income (loss) per common share:
Basic..................................................... $ (5.78)
Diluted................................................... $ (5.78)
Book value per share at period end........................ $ 4.68
</TABLE>
MARKET PRICE AND DIVIDEND DATA
The following table reflects the range of the reported high and low last
sale prices of shares of Millennium Pharmaceuticals common stock on the Nasdaq
National Market. The prices listed below have been retroactively adjusted for
the two-for-one stock split of our common stock which was effected on April 18,
2000.
<TABLE>
<CAPTION>
COMMON STOCK
-------------------
HIGH LOW
-------- --------
<S> <C> <C>
1998:
First quarter............................................. $ 11.19 $ 8.88
Second quarter............................................ $ 9.50 $ 7.07
Third quarter............................................. $ 9.35 $ 5.29
Fourth quarter............................................ $ 12.94 $ 7.38
1999:
First quarter............................................. $ 19.07 $ 12.72
Second quarter............................................ $ 20.19 $ 15.00
Third quarter............................................. $ 38.71 $ 18.38
Fourth quarter............................................ $ 70.85 $ 31.13
2000:
First quarter............................................. $157.28 $ 58.24
Second quarter (through April 27, 2000)................... $ 86.81 $ 52.38
</TABLE>
Millennium Pharmaceuticals common stock is listed on the Nasdaq Stock Market
under the symbol "MLNM." The common stock of Millennium Pharmaceuticals has been
listed on the Nasdaq Stock Market since May 6, 1996. Prior to May 6, 1996,
Millennium Pharmaceuticals' common stock was not publicly traded. On March 1,
2000, the last full trading day prior to the announcement of the merger, the
closing price per share of Millennium Pharmaceuticals common stock was $127.88
(as retroactively adjusted for our two-for-one common stock split effected on
April 18, 2000), as reported on the Nasdaq Stock Market. On , 2000,
the most recent practicable date prior to the mailing of
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this information statement/prospectus, the closing price per share of Millennium
Pharmaceuticals common stock was $ , as reported on the Nasdaq Stock
Market.
Millennium Pharmaceuticals has applied for the listing on the Nasdaq Stock
Market of the shares of Millennium Pharmaceuticals common stock to be issued in
the merger.
Millennium Pharmaceuticals has never paid any cash dividends on its common
stock and does not anticipate paying any cash dividends in the foreseeable
future. Payment of future dividends, if any, will be at the discretion of
Millennium Pharmaceuticals' board of directors.
There is no established public trading market for shares of Millennium
Predictive Medicine stock.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This information statement/prospectus and the documents incorporated by
reference in this information statement/prospectus contain forward-looking
statements that involve substantial risks and uncertainties. In some cases you
can identify these statements by forward-looking words such as "anticipate,"
"believe," "could," "estimate," "expect," "intend," "may," "should," "will," and
"would" or similar words. You should read statements that contain these words
carefully because, with respect to both Millennium Pharmaceuticals and
Millennium Predictive Medicine, they discuss future expectations, contain
projections of future results of operations or of financial position or state
other "forward-looking" information. The important factors listed above in the
section captioned "Risk Factors," as well as any cautionary language in this
information statement/prospectus, provide examples of risks, uncertainties and
events that may cause the actual results of either company to differ materially
from the expectations described in these forward-looking statements. You should
be aware that the occurrence of the events described in these risk factors and
elsewhere in this information statement/prospectus could have an adverse effect
on the business, results of operations and financial position of Millennium
Pharmaceuticals or Millennium Predictive Medicine.
Any forward-looking statements in this information statement/prospectus and
the documents incorporated by reference in this information statement/prospectus
are not guarantees of future performances, and actual results, developments and
business decisions may differ from those envisaged by such forward-looking
statements, possibly materially. Millennium Pharmaceuticals and Millennium
Predictive Medicine disclaim any duty to update any forward-looking statements,
all of which are expressly qualified by the statements in this section.
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THE MERGER
GENERAL
We are furnishing this information statement/prospectus to you in connection
with the proposed merger of Millennium Predictive Medicine with and into MPMx
Acquisition Corp., a wholly-owned subsidiary of Millennium Pharmaceuticals
formed for this transaction.
In the merger, each outstanding share of Millennium Predictive Medicine
common stock and preferred stock will be converted into 0.4 shares of Millennium
Pharmaceuticals common stock. If the shares of Millennium Pharmaceuticals common
stock that you would receive in the merger include a fraction of a share of
Millennium Pharmaceuticals common stock, Millennium Pharmaceuticals will instead
pay you an amount in cash equal to that fractional interest rather than give you
a fractional share of Millennium Pharmaceuticals common stock.
This information statement/prospectus is to inform you of the merger. Your
vote is not required for the merger because the holders of 100% of the voting
stock of Millennium Predictive Medicine, Millennium Pharmaceuticals and Becton,
Dickinson and Company, executed and delivered to Millennium Predictive Medicine
on March 1, 2000 a written consent in lieu of a meeting of stockholders
approving and adopting the merger agreement and the merger. As a result, no
meeting or further approval or consent of stockholders of Millennium Predictive
Medicine is necessary to effect the merger. The merger will become effective no
earlier than 20 business days after this information statement/prospectus is
mailed to Millennium Predictive Medicine stockholders.
This information statement/prospectus also constitutes a prospectus of
Millennium Pharmaceuticals, which is a part of the registration statement on
Form S-4 filed by Millennium Pharmaceuticals with the Securities and Exchange
Commission under the Securities Act of 1933 in order to register the shares of
Millennium Pharmaceuticals common stock to be issued to Millennium Predictive
Medicine stockholders. The total aggregate amount of consideration to be
received by Millennium Predictive Medicine's stockholders in the merger, other
than Millennium Pharmaceuticals, based on the closing price per share of
Millennium Pharmaceuticals common stock on April 27, 2000 of $63.25, is
approximately $86 million.
MILLENNIUM PHARMACEUTICALS' REASONS FOR THE MERGER
Millennium Pharmaceuticals expects to benefit from the merger by enhancing
its ability to more closely align efforts in therapeutic discovery and
developments with its efforts in predictive medicine. Millennium Pharmaceuticals
believes that its ability to pursue business opportunities, apply
pharmacogenomics broadly, and develop external relationships with additional
pharmaceutical and other alliance partners will be enhanced by the merger.
MILLENNIUM PREDICTIVE MEDICINE'S REASONS FOR THE MERGER
Based on the recommendation of its special committee, the board of directors
of Millennium Predictive Medicine believes that the terms of the merger
agreement and the transactions contemplated by the merger agreement are fair to,
and in the best interest of, Millennium Predictive Medicine and its
stockholders. Accordingly, the board of directors of Millennium Predictive
Medicine approved the merger agreement. In reaching their respective
determinations, the special committee and the board of directors consulted with
the management of Millennium Predictive Medicine, as well as the legal counsel
retained by the special committee, and considered a number of factors, including
the following:
- The merger consideration and recent trading prices for Millennium
Pharmaceuticals common stock;
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<PAGE>
- The fact that Millennium Predictive Medicine common stock and preferred
stock, which is illiquid, will be converted into a security which is
tradable on the Nasdaq Stock Market;
- Millennium Predictive Medicine's strategic alternatives, including
remaining a separate company;
- Millennium Pharmaceuticals' stated desire not to consider offers to sell
its position in Millennium Predictive Medicine, making it impracticable to
solicit any third-party bidder for Millennium Predictive Medicine;
- The financial presentation of Deutsche Banc Alex. Brown, and its opinion
dated March 1, 2000 as to the fairness, from a financial point of view, of
the conversion ratio to the holders of Millennium Predictive Medicine
common stock, other than Millennium Pharmaceuticals; and
- The terms and conditions of the merger agreement, including the price, the
scope of the parties' representations, warranties, covenants and
agreements and the limited number of conditions to the obligations of
Millennium Pharmaceuticals.
In reaching their determinations regarding the merger agreement, the special
committee and the board of directors did not view any single reason as
determinative. The special committee and the board of directors did not find it
necessary or practicable to assign relative and specific weights to the reasons
considered. Furthermore, individual directors may have given different weights
to different reasons.
BACKGROUND OF THE MERGER
During October and November 1999, Kenneth Conway, the chief executive
officer of Millennium Predictive Medicine, and Mark Levin, Steven Holtzman, John
Douglas and Kevin Starr, executive officers of Millennium Pharmaceuticals,
initiated discussions regarding the strategic rationale for a business
combination of the two companies. On December 1, 1999, the board of directors of
Millennium Pharmaceuticals held preliminary discussions regarding a possible
merger with Millennium Predictive Medicine. At this meeting, the board of
directors reached a consensus that merger discussions should be pursued and
formed a special committee, consisting of Grant Heidrich and Eric Lander, to
further investigate the benefits of a merger between the two companies.
On December 15, 1999, the board of directors of Millennium Predictive
Medicine held a meeting during which the board discussed a possible merger with
Millennium Pharmaceuticals. At this meeting, the Millennium Predictive Medicine
board of directors reached a consensus that merger discussions should be pursued
and formed a special independent committee, consisting of Marcia Radosevich, and
appointed it with the authority to retain legal counsel and an investment
banking firm.
On December 21, 1999, a teleconference took place among officers of
Millennium Predictive Medicine, including Kenneth Conway, Janet Bush and
Laurence Reid, executive officers of Millennium Pharmaceuticals, including Kevin
Starr and John Douglas, and Vincent Forlenza, a director of Millennium
Predictive Medicine and an officer of Becton Dickinson, and three other
representatives of Becton Dickinson. The participants discussed various tax and
accounting issues relating to the potential merger and possible changes to the
strategic alliance between Becton Dickinson and Millennium Predictive Medicine.
In late December 1999 and January 2000, officers of Millennium Predictive
Medicine and Millennium Pharmaceuticals held several discussions with
representatives of Becton Dickinson regarding various tax and accounting issues
relating to the merger.
In late January 2000, Mark Levin, the chief executive officer of Millennium
Pharmaceuticals, Kevin Starr, John Douglas and Kenneth Conway held several
discussions regarding the consideration to be paid to stockholders of Millennium
Predictive Medicine and the terms of a merger agreement.
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<PAGE>
On January 26, 2000, Vincent Forlenza and other representatives of Becton
Dickinson met with Kenneth Conway, Marcia Radosevich, Kevin Starr and John
Douglas to discuss the consideration to be paid to Millennium Predictive
Medicine stockholders in the potential merger and the terms of a merger
agreement.
On January 27, 2000 and January 28, 2000, Vincent Forlenza and John Douglas
spoke further by telephone about possible merger consideration and agreement
terms.
On January 31, 2000, at a regularly scheduled meeting, the board of
directors of Millennium Pharmaceuticals received an update on the status of the
merger discussions from Mark Levin and John Douglas and from Kenneth Conway,
representing Millennium Predictive Medicine.
In late January 2000 and early February 2000, John Douglas, Kevin Starr and
Mark Levin met several times, and spoke by telephone, with Kenneth Conway,
Marcia Radosevich and Vincent Forlenza regarding merger consideration and
possible conversion ratios.
In mid-February 2000, John Douglas, Kenneth Conway, Marcia Radosevich and
Vincent Forlenza tentatively agreed on a fixed conversion ratio of five shares
of Millennium Predictive Medicine stock for one share of Millennium
Pharmaceuticals common stock.
In mid-February 2000, the special committee of the Millennium Predictive
Medicine board of directors retained Mintz Levin Cohn Ferris Glovsky and Popeo
PC to provide legal advice and engaged Deutsche Banc Alex. Brown to render an
opinion to the special committee as to the fairness, from a financial point of
view, of the conversion ratio to be provided for in the merger to the holders of
Millennium Predictive Medicine common stock, other than Millennium
Pharmaceuticals.
Throughout February 2000, John Douglas provided periodic reports to the
members of the special committee of the Millennium Pharmaceuticals board of
directors on the status of the merger discussions.
On March 1, 2000, the board of directors of Millennium Pharmaceuticals met
and reviewed the final terms and conditions of the proposed transaction. The
special committee recommended to the board of directors the approval of the
merger agreement. After discussion, the board of directors unanimously approved
the terms of the merger agreement presented to it and authorized its execution.
On that same day, following a separate meeting of its special committee, the
board of directors of Millennium Predictive Medicine met and reviewed the final
terms and conditions of the proposed transactions. Mintz Levin Cohn Ferris
Glovsky and Popeo PC, legal counsel to the special committee, advised the board
on the terms of the merger agreement. Deutsche Banc Alex. Brown made a financial
presentation regarding the conversion ratio provided for in the proposed merger,
first to the special committee and then to the full board, and rendered to the
special committee its opinion to the effect that, as of the date of the opinion
and based on and subject to the matters described in its opinion, the conversion
ratio was fair, from a financial point of view, to the holders of Millennium
Predictive Medicine common stock, other than Millennium Pharmaceuticals. The
special committee then recommended to the board of directors the approval of the
merger agreement. After discussion, the board of directors unanimously approved
the terms of the merger agreement presented to it and authorized its execution
and the execution.
The definitive merger agreement was signed that day, and the signing was
announced on March 2, 2000.
OPINION OF DEUTSCHE BANC ALEX. BROWN
Millennium Predictive Medicine engaged Deutsche Banc Alex. Brown to render
an opinion to the Millennium Predictive Medicine special committee as to the
fairness, from a financial point of view, of the conversion ratio provided for
in the merger to the holders of Millennium Predictive Medicine
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<PAGE>
common stock, other than Millennium Pharmaceuticals. On March 1, 2000, at a
meeting of the special committee held to evaluate the proposed merger, Deutsche
Banc Alex. Brown rendered an oral opinion, confirmed by delivery of a written
opinion dated March 1, 2000, to the effect that, as of that date and based on
and subject to the matters described in its opinion, the conversion ratio was
fair, from a financial point of view, to the holders of Millennium Predictive
Medicine common stock other than Millennium Pharmaceuticals.
The full text of Deutsche Banc Alex. Brown's written opinion dated March 1,
2000, which describes the assumptions made, matters considered and limitations
of the review undertaken, is attached as Appendix B and is incorporated into
this information statement/prospectus by reference. DEUTSCHE BANC ALEX. BROWN'S
OPINION IS DIRECTED TO THE MILLENNIUM PREDICTIVE MEDICINE SPECIAL COMMITTEE AND
ADDRESSES ONLY THE FAIRNESS OF THE CONVERSION RATIO FROM A FINANCIAL POINT OF
VIEW. THE OPINION DOES NOT ADDRESS THE MERITS OF THE UNDERLYING DECISION BY
MILLENNIUM PREDICTIVE MEDICINE TO ENGAGE IN THE MERGER AND DOES NOT CONSTITUTE A
RECOMMENDATION TO ANY STOCKHOLDER AS TO ANY MATTERS RELATING TO THE MERGER. The
summary of Deutsche Banc Alex. Brown's opinion described below is qualified in
its entirety by reference to the full text of its opinion.
In arriving at its opinion, Deutsche Banc Alex. Brown:
- reviewed publicly available financial and other information concerning
Millennium Predictive Medicine and Millennium Pharmaceuticals and
internal analyses and other information which Millennium Predictive
Medicine, Millennium Pharmaceuticals and their advisors furnished to or
discussed with Deutsche Banc Alex. Brown;
- held discussions with members of the senior management of Millennium
Predictive Medicine and Millennium Pharmaceuticals regarding the
business and prospects of their companies and the joint prospects of a
combined company;
- reviewed the reported prices and trading activity for Millennium
Pharmaceuticals common stock;
- compared financial and stock market information for Millennium
Predictive Medicine and Millennium Pharmaceuticals with similar
information for other companies whose securities are publicly traded;
- reviewed the financial terms of recent business combinations which
Deutsche Banc Alex. Brown deemed comparable in whole or in part;
- reviewed the terms of the merger agreement; and
- performed other studies and analyses and considered other factors as
Deutsche Banc Alex. Brown deemed appropriate.
Deutsche Banc Alex. Brown did not assume responsibility for independent
verification of, and did not independently verify, any information, whether
publicly available or furnished to Deutsche Banc Alex. Brown, concerning
Millennium Predictive Medicine, Millennium Pharmaceuticals or the combined
company, including any financial information, forecasts or projections
considered in connection with the rendering of its opinion. For purposes of its
opinion, Deutsche Banc Alex. Brown assumed and relied on the accuracy and
completeness of all information that it reviewed and did not conduct a physical
inspection of any of the properties or assets, or prepare or obtain any
independent evaluation or appraisal of any of the assets or liabilities, of
Millennium Predictive Medicine or Millennium Pharmaceuticals. With respect to
the financial forecasts and projections that were made available to Deutsche
Banc Alex. Brown and used in its analyses, Millennium Predictive Medicine
advised Deutsche Banc Alex. Brown, and Deutsche Banc Alex. Brown assumed, that
they were reasonably prepared on bases reflecting the best currently available
estimates and judgments of the management of Millennium Predictive Medicine and
Millennium Pharmaceuticals. Deutsche Banc Alex. Brown's opinion was
23
<PAGE>
necessarily based on economic, market and other conditions existing on, and the
information made available to Deutsche Banc Alex. Brown as of, the date of its
opinion.
For purposes of rendering its opinion, Deutsche Banc Alex. Brown assumed
that, in all respects material to its analysis, the representations and
warranties of Millennium Predictive Medicine, Millennium Pharmaceuticals and
MPMx Acquisition Corp. contained in the merger agreement were true and correct,
Millennium Predictive Medicine, Millennium Pharmaceuticals and MPMx Acquisition
Corp. will each perform all of the covenants and agreements to be performed by
it under the merger agreement and all conditions to the obligations of each of
Millennium Predictive Medicine, Millennium Pharmaceuticals and MPMx Acquisition
Corp. to consummate the merger will be satisfied without any waiver.
Deutsche Banc Alex. Brown also assumed that all material governmental,
regulatory or other approvals and consents required in connection with the
consummation of the merger will be obtained and that in connection with
obtaining any necessary governmental, regulatory or other approvals and
consents, or any amendments, modifications or waivers to any agreements,
instruments or orders to which either Millennium Predictive Medicine or
Millennium Pharmaceuticals is a party or is subject or by which it is bound, no
limitations, restrictions or conditions will be imposed or amendments,
modifications or waivers made that would have a material adverse effect on
Millennium Predictive Medicine or Millennium Pharmaceuticals or materially
reduce the contemplated benefits of the merger to Millennium Predictive
Medicine, Millennium Pharmaceuticals or the combined company.
Millennium Predictive Medicine informed Deutsche Banc Alex. Brown, and for
purposes of rendering its opinion Deutsche Banc Alex. Brown assumed, that the
merger is expected to qualify as a tax-free reorganization for federal income
tax purposes. In connection with its opinion, Deutsche Banc Alex. Brown was not
requested to, and did not, participate in the negotiation or structuring of the
merger, and Deutsche Banc Alex. Brown was not authorized to, and did not,
solicit interest from any party with respect to the acquisition or all or a part
of Millennium Predictive Medicine. Deutsche Banc Alex. Brown expressed no
opinion as to the price at which the Millennium Pharmaceuticals common stock
will trade at any time. No other instructions or limitations were imposed by the
Millennium Predictive Medicine special committee on Deutsche Banc Alex. Brown
with respect to the investigations made or the procedures followed by it in
rendering its opinion.
The following is a summary of the material financial analyses performed by
Deutsche Banc Alex. Brown in connection with its opinion to the special
committee dated March 1, 2000:
CONTRIBUTION ANALYSIS.
Deutsche Banc Alex. Brown analyzed the respective contributions of
Millennium Predictive Medicine and Millennium Pharmaceuticals to the combined
company. Deutsche Banc Alex. Brown calculated the contributions of Millennium
Predictive Medicine and Millennium Pharmaceuticals as to latest 12 months and
estimated calendar years 2000 through 2004 revenues, committed research funding,
expected research funding and book value, both before and after taking into
account Millennium Predictive Medicine royalties, based both on internal
estimates of the management of Millennium Predictive Medicine and on publicly
available research analysts' estimates.
ANALYSIS OF SELECTED PRECEDENT TRANSACTIONS.
Deutsche Banc Alex. Brown reviewed the purchase prices paid in selected
transactions in the life sciences industry and technology values, calculated as
equity market value, plus debt, less cash, in the selected transactions as
multiples of latest 12 months revenues. Deutsche Banc Alex. Brown then compared
the technology value multiples derived from the selected transactions with
corresponding multiples for Millennium Predictive Medicine implied by the
conversion ratio. Deutsche Banc Alex. Brown also compared technology values of
the target companies in the selected transactions to the
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<PAGE>
technology value of Millennium Predictive Medicine implied by the conversion
ratio. All multiples and financial data for the selected transactions were based
on publicly available information at the time of announcement of the relevant
transaction.
ANALYSIS OF SELECTED PUBLIC AND PRIVATE COMPANIES.
Deutsche Banc Alex. Brown compared financial and stock market information
for Millennium Predictive Medicine and selected publicly held companies in the
life sciences industry. Deutsche Banc Alex. Brown reviewed technology values of
the selected publicly held companies as multiples of estimated calendar years
2000 and 2001 revenues. Deutsche Banc Alex. Brown then compared the technology
value multiples derived from the selected companies with corresponding multiples
for Millennium Predictive Medicine implied by the conversion ratio. All
multiples for the selected publicly held companies were based on closing stock
prices on February 29, 2000. Deutsche Banc Alex. Brown also reviewed equity
market values for selected publicly held companies implied by closing stock
prices on February 29, 2000 and for selected privately held companies implied by
recent private valuations, and compared those equity market values with the
equity market value for Millennium Predictive Medicine implied by the conversion
ratio. Estimated financial data for the selected publicly held companies were
based on publicly available research analysts' estimates, estimated financial
data for the selected privately held companies were based on publicly available
financial information and estimated financial data for Millennium Predictive
Medicine were based on internal estimates of the management of Millennium
Predictive Medicine.
DISCOUNTED CASH FLOW ANALYSIS.
Deutsche Banc Alex. Brown performed a discounted cash flow analysis to
estimate the present value of the unlevered, after-tax free cash flows that
Millennium Predictive Medicine could generate during fiscal years 2000 through
2004. The range of estimated terminal values was calculated by applying a range
of selected terminal value multiples to the estimated fiscal year 2004 earnings
before interest, taxes, depreciation and amortization of Millennium Predictive
Medicine. The present value of the cash flows and terminal values were
calculated using a range of selected discount rates. Estimated financial data
for Millennium Predictive Medicine were based on internal estimates of the
management of Millennium Predictive Medicine.
OTHER FACTORS.
In rendering its opinion, Deutsche Banc Alex. Brown also reviewed and
considered other factors, including:
- a business profile of Millennium Pharmaceuticals;
- historical market prices, trading volumes and trading characteristics
of Millennium Pharmaceuticals common stock and the relationship between
movements in Millennium Pharmaceuticals common stock, an index of
selected publicly traded companies in the life sciences industry and
the S&P 500 index; and
- selected published analysts' reports, including analysts' earnings per
share, growth rate and stock price estimates for Millennium
Pharmaceuticals.
The above summary is not a complete description of Deutsche Banc Alex.
Brown's opinion to the Millennium Predictive Medicine special committee or the
financial analyses performed and factors considered by Deutsche Banc Alex. Brown
in connection with its opinion. The preparation of a fairness opinion is a
complex analytical process involving various determinations as to the most
appropriate and relevant methods of financial analysis and the application of
those methods to the particular circumstances and, therefore, a fairness opinion
is not readily susceptible to summary description.
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<PAGE>
Deutsche Banc Alex. Brown believes that its analyses and the summary above must
be considered as a whole and that selecting portions of its analyses and
factors, without considering all analyses and factors, could create a misleading
or incomplete view of the processes underlying Deutsche Banc Alex. Brown's
analyses and opinion.
In performing its analyses, Deutsche Banc Alex. Brown considered industry
performance, general business, economic, market and financial conditions and
other matters existing as of the date of its opinion, many of which are beyond
the control of Millennium Predictive Medicine and Millennium Pharmaceuticals. No
company, transaction or business used in the analyses as a comparison is
identical to Millennium Predictive Medicine, Millennium Pharmaceuticals or the
merger, and an evaluation of the results of those analyses is not entirely
mathematical. Rather, the analyses involve complex considerations and judgments
concerning financial and operating characteristics and other factors that could
affect the acquisition, public trading or other values of the companies,
business segments or transactions analyzed.
The estimates contained in Deutsche Banc Alex. Brown's analyses and the
ranges of valuations resulting from any particular analysis are not necessarily
indicative of actual values or future results, which may be significantly more
or less favorable than those suggested by its analyses. In addition, analyses
relating to the value of businesses or securities do not necessarily purport to
be appraisals or to reflect the prices at which businesses or securities
actually may be sold. Accordingly, Deutsche Banc Alex. Brown's analyses and
estimates are inherently subject to substantial uncertainty.
The type and amount of consideration payable in the merger was determined
through negotiation between the Millennium Predictive Medicine special committee
and Millennium Pharmaceuticals, and the decision to enter into the merger was
solely that of the Millennium Predictive Medicine special committee and board of
directors. Deutsche Banc Alex. Brown's opinion and financial analyses were only
one of many factors considered by the special committee in its evaluation of the
merger and should not be viewed as determinative of the views of the Millennium
Predictive Medicine special committee and board of directors or management with
respect to the conversion ratio or the merger.
Deutsche Banc Alex. Brown is an internationally recognized investment
banking firm and, as a customary part of its investment banking business, is
engaged in the valuation of businesses and their securities in connection with
mergers and acquisitions, negotiated underwritings, private placements and
valuations for estate, corporate and other purposes. The special committee
selected Deutsche Banc Alex. Brown based on Deutsche Banc Alex. Brown's
reputation and expertise.
Deutsche Banc Alex. Brown maintains a market in securities, and regularly
publishes research reports regarding the businesses and securities, of publicly
traded companies in the life sciences industry. In the ordinary course of
business, Deutsche Banc Alex. Brown and its affiliates may in the future provide
services to Millennium Pharmaceuticals unrelated to the proposed merger, for
which services Deutsche Banc Alex. Brown and its affiliates would receive
compensation, and Deutsche Banc Alex. Brown and its affiliates may actively
trade or hold the securities and other instruments and obligations of Millennium
Pharmaceuticals for their own account and for the accounts of customers and,
accordingly, may at any time hold a long or short position in those securities,
instruments or obligations. Deutsche Banc Alex. Brown and its affiliates hold
warrants to purchase 35,066 shares of Millennium Pharmaceuticals common stock at
an exercise price of $2.81 per share and 88,000 shares of Millennium
Pharmaceuticals common stock at an exercise price of $3.00 per share.
Under the terms of Deutsche Banc Alex. Brown's engagement, Millennium
Predictive Medicine agreed to pay Deutsche Banc Alex. Brown for its services
with respect to its opinion an aggregate fee of $250,000 upon delivery of its
opinion. In addition, Millennium Predictive Medicine has agreed to reimburse
Deutsche Banc Alex. Brown for its reasonable travel and other out-of-pocket
expenses, including reasonable fees and disbursements of counsel, and to
indemnify Deutsche Banc Alex. Brown
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and related parties against liabilities, including liabilities under the federal
securities laws, relating to, or arising out of, Deutsche Banc Alex. Brown's
engagement.
MILLENNIUM PREDICTIVE MEDICINE STOCK OPTIONS
Upon completion of the merger, Millennium Pharmaceuticals will assume
Millennium Predictive Medicine's stock option plan and each of the outstanding
options issued under the plan. At April , 2000, executive officers and
directors of Millennium Predictive Medicine and their affiliates collectively
had options to acquire an aggregate of 60,000 shares of Millennium Predictive
Medicine Class B common stock.
EFFECTIVE TIME OF THE MERGER
The merger will occur as soon as practicable on or after the twentieth
business day following the date this information statement/prospectus is mailed
to the stockholders of Millennium Predictive Medicine. The merger will become
effective upon filing of the certificate of merger with the Secretary of State
of the State of Delaware or on such later date and time as may be specified in
the certificate of merger. The time at which the merger becomes effective is
referred to in this document as the "effective time of the merger."
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following discussion summarizes the material federal income tax
considerations relevant to the merger that are applicable to holders of
Millennium Predictive Medicine common stock and preferred stock. This discussion
is based on currently existing provisions of the Internal Revenue Code, existing
Treasury regulations thereunder and current administrative rulings and court
decisions, all of which are subject to change. Any such change, which may or may
not be retroactive, could alter the tax consequences to Millennium
Pharmaceuticals, Millennium Predictive Medicine or the holders of Millennium
Predictive Medicine common stock and preferred stock as described in this
section.
The holders of Millennium Predictive Medicine common stock and preferred
stock should be aware that this discussion does not deal with all federal income
tax considerations that may be relevant to particular stockholders in light of
their particular circumstances, such as:
- stockholders who are dealers in securities,
- who are insurance companies or financial institutions,
- who hold their shares as a hedge against currency risks, a constructive
sale or a conversion transaction,
- who are foreign persons or entities,
- who do not hold their Millennium Predictive Medicine common stock and
preferred stock as capital assets, or
- who acquired their shares in connection with stock option or stock
purchase plans or in other compensatory transactions.
In addition, the following discussion does not address the tax consequences
of the merger under foreign, state or local tax laws. ACCORDINGLY, HOLDERS OF
MILLENNIUM PREDICTIVE MEDICINE COMMON STOCK AND PREFERRED STOCK ARE URGED TO
CONSULT THEIR OWN TAX ADVISORS AS TO THE SPECIFIC TAX CONSEQUENCES OF THE
MERGER, INCLUDING THE APPLICABLE FEDERAL, STATE, LOCAL AND FOREIGN TAX
CONSEQUENCES TO THEM OF THE MERGER.
The consummation of the merger is conditioned upon Hale and Dorr LLP
delivering a tax opinion at the closing of the merger to Millennium
Pharmaceuticals and Millennium Predictive Medicine that
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the merger will be treated as a "reorganization" within the meaning of
Section 368(a) of the Code. The tax opinion will be subject to certain
assumptions, limitations and qualifications, and is based upon certain factual
representations of Millennium Pharmaceuticals and Millennium Predictive
Medicine. The form of tax opinion has been filed as an exhibit to the
registration statement of which this information statement/prospectus is a part.
As a result of the merger qualifying as a reorganization, subject to the
assumptions, limitations and qualifications referred to herein and in the tax
opinion, the merger should result in the following federal income tax
consequences:
- No gain or loss will be recognized by holders of Millennium Predictive
Medicine common stock and preferred stock solely upon their receipt in the
merger of Millennium Pharmaceuticals common stock in exchange therefor
(except to the extent of cash received in lieu of a fractional share of
Millennium Pharmaceuticals common stock).
- The aggregate tax basis of the Millennium Pharmaceuticals common stock
received by holders of Millennium Predictive Medicine common stock and
preferred stock in the merger (including any fractional share of
Millennium Pharmaceuticals common stock not actually received) will be the
same as the aggregate tax basis of the Millennium Predictive Medicine
common stock and preferred stock surrendered in exchange therefor.
- The holding period of the Millennium Pharmaceuticals common stock received
by each holder of Millennium Predictive Medicine common stock and
preferred stock in the merger will include the period for which the
Millennium Predictive Medicine common stock and preferred stock
surrendered in exchange therefor was held, provided that the Millennium
Predictive Medicine common stock and preferred stock so surrendered was
held as a capital asset at the time of the merger.
- Cash payments received by holder of Millennium Predictive Medicine common
stock and preferred stock in lieu of a fractional share will be treated as
if such fractional share of Millennium Pharmaceuticals common stock had
been issued in the merger and then redeemed by Millennium Pharmaceuticals.
A Millennium Predictive Medicine stockholder receiving such cash will
recognize gain or loss, upon such payment, measured by the difference (if
any) between the amount of cash received and basis in such fractional
share.
- Neither Millennium Pharmaceuticals nor Millennium Predictive Medicine will
recognize gain or loss solely as a result of the merger.
The parties will not request a ruling from the Internal Revenue Service in
connection with the merger. Holders of Millennium Predictive Medicine common
stock and preferred stock should be aware that the tax opinion will not bind the
Internal Revenue Service. In addition, the tax opinion is subject to certain
assumptions, limitations and qualifications, including but not limited to the
truth and accuracy of certain representations made by Millennium Pharmaceuticals
and Millennium Predictive Medicine.
A successful challenge by the Internal Revenue Service to the reorganization
status of the merger would result in the holders of Millennium Predictive
Medicine common stock and preferred stock recognizing taxable gain or loss with
respect to each share of Millennium Predictive Medicine common stock and
preferred stock surrendered. The amount of gain or loss would be equal to the
difference between the stockholder's basis in such share and the fair market
value, as of the effective time of the merger, of the Millennium Pharmaceuticals
common stock received in exchange therefor. In such event, a stockholder's
aggregate basis in the Millennium Pharmaceuticals common stock so received would
equal its fair market value as of the effective time of the merger, and the
stockholder's holding period for such stock would begin the day after the
merger.
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ACCOUNTING TREATMENT
The merger will be accounted for as an exchange of shares between companies
under common control, in accordance with generally accepted accounting
principles. Under this method of accounting, the recorded book values of the
assets, liabilities and shareholders' equity of Millennium Pharmaceuticals and
Millennium Predictive Medicine will be combined.
LISTING OF SHARES OF MILLENNIUM PHARMACEUTICALS COMMON STOCK ON THE NASDAQ STOCK
MARKET
Millennium Pharmaceuticals has filed a listing notice with the Nasdaq Stock
Market to cause the shares of Millennium Pharmaceuticals common stock which are
to be issued in the merger and upon exercise of options granted to employees of
Millennium Predictive Medicine to be listed for trading on the Nasdaq Stock
Market.
APPRAISAL RIGHTS OF DISSENTING STOCKHOLDERS OF MILLENNIUM PREDICTIVE MEDICINE
If the merger is consummated, a holder of record of Millennium Predictive
Medicine stock on the date of making a demand for appraisal, as described below,
will be entitled to have those shares appraised by the Delaware Court of
Chancery under Section 262 of the Delaware corporation statute and to receive
payment for the "fair value" of those shares instead of the consideration
provided for in the merger agreement. In order to be eligible to receive this
payment, however, a stockholder must (1) continue to hold his or her shares
through the time of the merger and (2) strictly comply with the procedures
discussed under Section 262.
This information statement/prospectus is being sent to all holders of record
of Millennium Predictive Medicine stock and constitutes notice pursuant to
Section 262(d)(2) of the appraisal rights available to those holders under
Section 262. THE STATUTORY RIGHT OF APPRAISAL GRANTED BY SECTION 262 REQUIRES
STRICT COMPLIANCE WITH THE PROCEDURES IN SECTION 262. FAILURE TO FOLLOW ANY OF
THESE PROCEDURES MAY RESULT IN A TERMINATION OR WAIVER OF DISSENTERS' RIGHTS
UNDER SECTION 262. THE FOLLOWING IS A SUMMARY OF THE PRINCIPAL PROVISIONS OF
SECTION 262. The following summary is not a complete statement of Section 262 of
the Delaware corporation statute, and is qualified in its entirety by reference
to Section 262, which is incorporated herein by reference, together with any
amendments to the laws that may be adopted after the date of this information
statement/prospectus. A copy of Section 262 is attached as Appendix C to this
information statement/prospectus.
NOTICE REQUIREMENTS. Under Section 262, where a merger is approved pursuant
to Section 228 of the Delaware General Corporation Law, either before or within
ten days after the effective date of the merger, Millennium Pharmaceuticals must
notify each stockholder of Millennium Predictive Medicine entitled to appraisal
rights of the merger and that appraisal rights are available to the stockholder
and include in each notice a copy of Section 262. This information
statement/prospectus constitutes the notice of appraisal rights to the record
holders of Class B common stock.
DEMAND FOR APPRAISAL. Only a record holder of shares of Millennium
Predictive Medicine stock on the date of making a written demand for appraisal
who continuously holds those shares through the time of the merger is entitled
to seek appraisal. Demand for appraisal must be executed by or for the holder of
record, fully and correctly, as that holder's name appears on the holder's stock
certificates representing shares of Millennium Predictive Medicine stock. If
Millennium Predictive Medicine stock is owned of record in a fiduciary capacity
by a trustee, guardian or custodian, the demand should be made in that capacity.
If Millennium Predictive Medicine stock is owned of record by more than one
person, as in a joint tenancy or tenancy in common, the demand should be made by
or for all owners of record.
An authorized agent, including an agent for one or more joint owners, may
execute the demand for appraisal for a holder of record; that agent, however,
must identify the record owner or owners and
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expressly disclose in the demand that the agent is acting as agent for the
record owner or owners of the shares. If a stockholder holds shares of
Millennium Predictive Medicine Stock through a broker who in turn holds the
shares through a central securities depository nominee such as Cede & Co., a
demand for appraisal of such shares must be made by or on behalf of the
depository nominee and must identify the depository nominee as record holder.
A record holder such as a broker, fiduciary, depository or other nominee who
holds shares of Millennium Predictive Medicine stock as a nominee for more than
one beneficial owner, some of whom desire to demand appraisal, may exercise
appraisal rights on behalf of those beneficial owners with respect to the shares
of Millennium Predictive Medicine stock, held for those beneficial owners. In
that case, the written demand for appraisal should state the number of shares of
Millennium Predictive Medicine stock covered by it. Unless a demand for
appraisal specifies a number of shares, the demand will be presumed to cover all
shares of Millennium Predictive Medicine stock held in the name of the record
owner.
In order to exercise appraisal rights, a stockholder must, within twenty
days after the date of mailing of this information statement/prospectus, demand
in writing from Millennium Pharmaceuticals, as the surviving corporation, an
appraisal of his, her or its shares of Millennium Predictive Medicine common
stock or preferred stock. Such demand will be sufficient if it reasonably
informs Millennium Pharmaceuticals of the identity of the stockholder and that
the stockholder intends to demand an appraisal of the fair value of his, her or
its shares of Millennium Predictive Medicine common stock or preferred stock.
Failure to make such demand on or before the expiration of such twenty day
period will foreclose a stockholder's rights to appraisal. Stockholders should
not expect to receive any additional notice with respect to the deadline for
demanding appraisal rights. All demands should be delivered to Millennium
Pharmaceuticals, Attention: John B. Douglas III, 75 Sidney Street, Cambridge,
Massachusetts 02139, telephone (617) 679-7000.
BENEFICIAL OWNERS WHO ARE NOT RECORD OWNERS AND WHO INTEND TO EXERCISE
APPRAISAL RIGHTS SHOULD INSTRUCT THE RECORD OWNER TO COMPLY WITH THE STATUTORY
REQUIREMENTS WITH RESPECT TO THE EXERCISE OF APPRAISAL RIGHTS WITHIN TWENTY DAYS
OF THE MAILING OF THE NOTICE.
FILING OF PETITION. Within 120 days after the effective date of the merger,
any stockholder who has complied with the applicable provisions of Section 262
will be entitled, upon written request, to receive from Millennium Predictive
Medicine a statement setting forth the aggregate number of shares of common
stock not voting in favor of the merger and with respect to which demands for
appraisal were received by Millennium Predictive Medicine and the number of
holders of such shares. Millennium Predictive Medicine must mail this statement
within 10 days after it receives the written request or within 10 days after the
expiration of the period for the delivery of demands as described above,
whichever is later.
Within 120 days after the effective date of the merger, the surviving
corporation or any stockholder who has complied with the requirements of
Section 262 may file a petition in the Delaware Court of Chancery demanding a
determination of the fair value of the shares of Millennium Predictive Medicine
stock held by all stockholders seeking appraisal. A dissenting stockholder must
serve a copy of the petition on Millennium Pharmaceuticals. If no petition is
filed by either Millennium Pharmaceuticals or any dissenting shareholder within
the 120-day period, the rights of all dissenting stockholders to appraisal will
cease.
Stockholders seeking to exercise appraisal rights should not assume that the
surviving corporation will file a petition with respect to the appraisal of the
fair value of their shares or that the surviving corporation will initiate any
negotiations with respect to the fair value of those shares. The surviving
corporation is under no obligation to, and has no present intention to, take any
action in this regard. Accordingly, stockholders who wish to seek appraisal of
their shares should initiate all necessary action with respect to the perfection
of their appraisal rights within the time periods and in the manner
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prescribed in Section 262. FAILURE TO FILE THE PETITION ON A TIMELY BASIS WILL
CAUSE THE STOCKHOLDER'S RIGHT TO AN APPRAISAL TO CEASE.
HEARING IN CHANCERY COURT. If a petition for an appraisal is filed in a
timely manner, at the hearing on the petition, the Delaware Court of Chancery
will determine which stockholders are entitled to appraisal rights and will
appraise the shares of Millennium Predictive Medicine stock owned by those
stockholders. The Delaware Court may require the stockholders who have demanded
an appraisal for their shares and who hold stock represented by certificates to
submit their certificates of stock to the Register in Chancery for notation
thereon of the pendency of the appraisal proceedings; and if any stockholder
fails to comply with such direction, the Delaware Court may dismiss the
proceedings as to such stockholder. The court will determine the fair value of
those shares, exclusive of any element of value arising from the accomplishment
or expectation of the merger, together with a fair rate of interest, to be paid,
if any, upon the fair value. The Court of Chancery may determine the cost of the
appraisal proceeding and assess it against the parties as the Court deems
equitable.
Although Millennium Predictive Medicine believes that the consideration to
be received by its stockholders for their shares of Millennium Predictive
Medicine common stock is fair, no representation is made as to the outcome of
the appraisal of fair value as determined by the court and stockholders should
recognize that such an appraisal could result in a determination of a value that
is higher or lower than, or the same as, the merger consideration. Moreover,
Millennium Pharmaceuticals does not anticipate offering more than the merger
consideration to any stockholder exercising appraisal rights and reserves the
right to assert, in any appraisal proceeding, that, for purposes of
Section 262, the "fair value" of a share of Millennium Predictive Medicine
common stock is less than the merger consideration.
DETERMINATION OF FAIR VALUE. In determining "fair value," the Delaware
Court is required to take into account all relevant factors. In WEINBERGER V.
UOP, INC., the Delaware Supreme Court discussed the factors that could be
considered in determining fair value in an appraisal proceeding, stating that
"proof of value by any techniques or methods which are generally considered
acceptable in the financial community and otherwise admissible in court" should
be considered and that "[f]air price obviously requires consideration of all
relevant factors involving the value of a company." The Delaware Supreme Court
has stated that in making this determination of fair value the court must
consider market value, asset value, dividends, earnings prospects, the nature of
the enterprise and any other facts which could be ascertained as of the date of
the merger which throw any light on future prospects of the merged corporation.
Section 262 provides that fair value is to be "exclusive of any element of
value arising from the accomplishment or expectation of the merger." In CEDE &
CO. V. TECHNICOLOR, INC., the Delaware Supreme Court stated that such exclusion
is a "narrow exclusion [that] does not encompass known elements of value," but
which rather applies only to the speculative elements of value arising from such
accomplishment or expectation. In WEINBERGER, the Delaware Supreme Court
construed Section 262 to mean that "elements of future value, including the
nature of the enterprise, which are known or susceptible of proof as of the date
of the merger and not the product of speculation, may be considered."
EXPENSES. Each dissenting stockholder is responsible for his or her
attorneys' and expert witness expenses, although upon application of a
dissenting stockholder, the Court may order that all or a portion of the
expenses incurred by any dissenting stockholder in connection with the appraisal
proceeding (including, without limitation, reasonable attorney's fees and the
fees and expenses of experts) be charged pro rata against the value of all
shares of Millennium Predictive Medicine stock entitled to appraisal. In the
absence of a court determination or assessment, each party bears its own
expenses.
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NO RIGHT TO VOTE OR RECEIVE DIVIDENDS. Any stockholder who has demanded
appraisal in compliance with Section 262 will not, after the merger, be entitled
to vote such stock for any purpose or receive payment of dividends or other
distributions, if any, on the Millennium Predictive Medicine stock, except for
dividends or distributions, if any, payable to stockholders of record at a date
prior to the merger.
WITHDRAWAL. A stockholder may withdraw a demand for appraisal and accept
the Millennium Pharmaceuticals common stock at any time within 60 days after the
effective date of the merger, or thereafter may withdraw a demand for appraisal
with the written approval of Millennium Pharmaceuticals. Notwithstanding the
foregoing, if an appraisal proceeding is properly instituted, it may not be
dismissed as to any stockholder without the approval of the Delaware Court of
Chancery, and any such approval may be conditioned on the Court of Chancery's
deeming the terms to be just. If, after the merger, a holder of Millennium
Predictive Medicine stock who had demanded appraisal for his shares fails to
perfect or loses his right to appraisal, those shares will be treated as if they
were converted into Millennium Pharmaceuticals common stock at the time of the
merger.
IN VIEW OF THE COMPLEXITY OF THESE PROVISIONS OF THE DELAWARE CORPORATE LAW,
ANY MILLENNIUM PREDICTIVE MEDICINE STOCKHOLDER WHO IS CONSIDERING EXERCISING
APPRAISAL RIGHTS SHOULD CONSULT A LEGAL ADVISOR.
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THE MERGER AGREEMENT
In this section of the information statement/prospectus, we describe the
material provisions of the merger agreement. We have attached a copy of the
merger agreement as Appendix A to this information statement/prospectus and
incorporate the merger agreement into this information statement/prospectus by
reference. The summary of the merger agreement we provide below is qualified in
its entirety by reference to the merger agreement. We encourage you to read the
merger agreement because it is the legal document that governs the merger.
THE MERGER
Under the terms and subject to the conditions set forth in the merger
agreement, Millennium Predictive Medicine will merge with and into MPMx
Acquisition Corp., a wholly-owned subsidiary of Millennium Pharmaceuticals, with
MPMx Acquisition Corp. continuing as the surviving corporation and a
wholly-owned subsidiary of Millennium Pharmaceuticals.
CONSIDERATION TO BE RECEIVED IN THE MERGER
At the time of the merger, each outstanding share of Millennium Predictive
Medicine common stock and preferred stock will be converted into the right to
receive 0.4 shares of Millennium Pharmaceuticals common stock.
Each share of Millennium Predictive Medicine stock owned by Millennium
Predictive Medicine as treasury stock or by Millennium Pharmaceuticals will be
automatically canceled and retired in the merger and will cease to exist, and no
securities of Millennium Pharmaceuticals or other consideration will be
delivered in exchange for those shares.
PROCEDURES FOR SURRENDER OF MILLENNIUM PREDICTIVE MEDICINE CERTIFICATES;
FRACTIONAL SHARES
SURRENDER OF MILLENNIUM PREDICTIVE MEDICINE CERTIFICATES. As soon as
reasonably practicable after the effective time of the merger, EquiServe, the
exchange agent for the merger, will send a letter of transmittal and
instructions with respect to the surrender by Millennium Predictive Medicine
stockholders of their Millennium Predictive Medicine stock certificates to each
former Millennium Predictive Medicine stockholder.
Upon compliance with the transmittal letter, each Millennium Predictive
Medicine stockholder will be entitled to receive a stock certificate
representing whole shares of Millennium Pharmaceuticals common stock which such
holder has the right to receive pursuant to the merger agreement, together with
a cash payment in lieu of fractional shares, if any.
After the merger, until surrendered to the exchange agent, each certificate
that previously represented shares of Millennium Predictive Medicine stock will
represent only the right to receive upon surrender a certificate evidencing
whole shares of Millennium Pharmaceuticals common stock into which such shares
of Millennium Predictive Medicine stock were converted in the merger and cash in
lieu of fractional shares of Millennium Pharmaceuticals common stock, if any, as
described below.
Holders of certificates previously representing shares of Millennium
Predictive Medicine stock will not be paid dividends or other distributions
payable to holders of record of shares of Millennium Pharmaceuticals common
stock as of any record date after the effective time of the merger, until their
certificates are surrendered to the exchange agent. When their certificates are
surrendered, any unpaid dividends with a record date after the effective time of
the merger but prior to such surrender with respect to whole shares of
Millennium Pharmaceuticals common stock and any cash in lieu of fractional
shares of Millennium Pharmaceuticals common stock payable as described below
will be paid without interest.
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We will close Millennium Predictive Medicine's stock transfer books at the
effective time of the merger, and no further transfers of shares of Millennium
Predictive Medicine stock will be recorded on its stock transfer books. If a
transfer of ownership of Millennium Predictive Medicine stock that is not
registered in the transfer records of Millennium Predictive Medicine has
occurred, a certificate representing the proper number of shares of Millennium
Pharmaceuticals common stock will be issued to a person other than the person in
whose name the certificate so surrendered is registered, together with a cash
payment in lieu of fractional shares, if any, and payment of dividends or
distributions, if any, so long as:
- the Millennium Predictive Medicine stock certificates are accompanied by
all documents required to evidence and effect the transfer; and
- the person requesting such payment pays any transfer or other taxes
required by reason of the issuance of shares of Millennium Pharmaceuticals
common stock or the person requesting payment establishes to Millennium
Predictive Medicine's satisfaction that all such taxes have been paid.
FRACTIONAL SHARES. No fractional share of Millennium Pharmaceuticals common
stock will be issued to any Millennium Predictive Medicine stockholder upon
surrender of certificates previously representing Millennium Predictive Medicine
stock. Instead, the exchange agent will pay to each of those stockholders an
amount in cash determined by multiplying the fractional share interest to which
the holder would otherwise be entitled by the last reported sale price of a
share of Millennium Pharmaceuticals common stock on the Nasdaq Stock Market on
the trading day immediately prior to the closing date.
EFFECT ON THE MILLENNIUM PREDICTIVE MEDICINE 1997 EQUITY INCENTIVE PLAN
At the effective time of the merger, Millennium Pharmaceuticals will assume
the Millennium Predictive Medicine 1997 Equity Incentive Plan and each option
granted under the plan that is outstanding and unexercised immediately prior to
the effective time of the merger. At the effective time of the merger,
Millennium Pharmaceuticals will replace each option to purchase Class B common
stock of Millennium Predictive Medicine with an option to purchase Millennium
Pharmaceuticals common stock.
The number of shares of Millennium Pharmaceuticals common stock subject to
the new Millennium Pharmaceuticals option will be equal to the number of shares
of Millennium Predictive Medicine Class B common stock subject to the Millennium
Predictive Medicine option multiplied by 0.4. Any fractional shares will be
rounded down to the nearest whole share.
The exercise price per share of Millennium Pharmaceuticals common stock will
be equal to the exercise price for the shares of Millennium Predictive Medicine
Class B common stock subject to the Millennium Predictive Medicine option
divided by 0.4.
The duration and other terms of each Millennium Pharmaceuticals option,
including the vesting terms, will be the same as for the prior Millennium
Predictive Medicine option.
REPRESENTATIONS AND WARRANTIES
Millennium Pharmaceuticals and Millennium Predictive Medicine have made
representations and warranties in the merger agreement relating to, among other
things:
- their corporate organization, qualification, standing and power;
- their capital structures;
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- the authorization, execution, delivery, and enforceability of the merger
agreement and related matters;
- required consents, approvals, orders and authorizations of governmental
authorities relating to, and non-contravention of certain agreements as a
result of, the merger agreement;
- documents filed by Millennium Pharmaceuticals with the SEC and the
accuracy of the information contained in such documents;
- absence of certain adverse material changes or events with respect to
Millennium Pharmaceuticals since December 31, 1999;
- litigation with respect to Millennium Pharmaceuticals.
The merger agreement also contains a representation and warranty of
Millennium Predictive Medicine relating to the opinion of its financial advisor.
The representations and warranties made by the parties to the merger
agreement will not survive the effective time of the merger, but they form the
basis of a condition to the obligations of Millennium Pharmaceuticals and
Millennium Predictive Medicine to complete the merger.
COVENANTS
CLOSING EFFORTS. Each party has agreed to use its reasonable best efforts
to take all actions and do all things necessary, proper or advisable to complete
the merger and other transactions contemplated in the merger agreement
including:
- ensuring that its representations and warranties remain true and correct
in all material respects through the closing of the merger; and
- ensuring that the conditions to the obligations of the other party to
consummate the merger are satisfied.
INFORMATION STATEMENT/PROSPECTUS AND REGISTRATION STATEMENT. Millennium
Pharmaceuticals has agreed in the merger agreement to prepare and file with the
SEC this information statement/prospectus and the related registration statement
on Form S-4 and use its reasonable best efforts to have the registration
statement declared effective as promptly as practicable.
OPERATION OF BUSINESS. Millennium Predictive Medicine has agreed in the
merger agreement that during the period from the date of the merger agreement
and continuing until the effective time of the merger, Millennium Predictive
Medicine will carry on its businesses in the ordinary course and in compliance
with all applicable laws and regulations and use its reasonable best efforts to
preserve intact its current business organization, keep its physical assets in
good working condition, keep available the services of their current officers
and employees and preserve its relationships with customers, suppliers and
others with whom it has business dealings.
LISTING OF MILLENNIUM PHARMACEUTICALS COMMON STOCK. Millennium
Pharmaceuticals has agreed in the merger agreement to list the shares of its
common stock to be issued in the merger on the Nasdaq Stock Market.
INSURANCE AND INDEMNIFICATION. After the merger, Millennium Pharmaceuticals
has agreed that it will indemnify each present and former director and officer
of Millennium Predictive Medicine against any claims, losses and liabilities,
including related costs and expenses, pertaining to matters occurring prior to
the effective time of the merger. For three years after the merger, Millennium
Pharmaceuticals will maintain in effect directors' and officers' liability
insurance covering acts or omissions occurring prior to and as of the effective
time of the merger. Millennium Pharmaceuticals and its subsidiaries will not,
however, be required to pay, in total, an annual premium for the insurance
described in this
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paragraph in excess of 150% of the current annual premium paid by Millennium
Predictive Medicine for its existing coverage prior to the merger.
CONDITIONS
The obligations of each party to the merger agreement to complete the merger
are subject to the satisfaction or waiver of various conditions on or before the
effective time of the merger, which include, in addition to other customary
closing conditions, the following:
- Millennium Pharmaceuticals and Millennium Predictive Medicine shall have
received an opinion of Hale and Dorr LLP to the effect that the merger
will qualify as a reorganization within the meaning of Section 368(a) of
the Internal Revenue Code;
- No litigation brought by any governmental entity seeking to enjoin
completion of the merger, and no order, executive order, stay, decree,
judgment or injunction or statute, rule or regulation shall be in effect
that prohibits the completion of the merger;
- The registration statement on Form S-4 of which this information
statement/prospectus is a part shall have been declared effective and
shall not be the subject of any stop order, and any proceedings shall not
have been brought or threatened by the SEC for that purpose; and
- All waivers, permits, consents, approvals or other authorizations required
to be obtained, and all registrations, filings and notices required to be
made, by Millennium Pharmaceuticals and Millennium Predictive Medicine
prior to the completion of the merger and the related transactions shall
have been obtained from, and made with, all required governmental entities
except for those whose failure to obtain or effect would not have a
material adverse effect, at or after the effective time of the merger, on
Millennium Predictive Medicine or Millennium Pharmaceuticals.
The obligation of Millennium Predictive Medicine to effect the merger is
also subject to the satisfaction of the following conditions:
- The representations and warranties of Millennium Pharmaceuticals in the
merger agreement shall be true and correct as of the closing date of the
merger in all material respects, except that those representations that
are qualified as to materiality shall be true and correct in all respects,
provided that those representations and warranties that address matters
only as of a particular date shall remain true and correct as of such
particular date; and
- Millennium Pharmaceuticals shall have performed in all material respects
all agreements and covenants required to be performed or complied with
under the merger agreement at or prior to the closing date of the merger.
The obligation of Millennium Pharmaceuticals to effect the merger is also
subject to the satisfaction of the following conditions:
- The representations and warranties of Millennium Predictive Medicine in
the merger agreement shall be true and correct as of the closing date of
the merger in all material respects, except that those representations
that are qualified as to materiality shall be true and correct in all
respects, provided that those representations and warranties which address
matters only as of a particular date shall remain true and correct as of
such particular date;
- Millennium Predictive Medicine shall have performed in all material
respects all agreements and covenants required to be performed or complied
with under the merger agreement at or prior to the closing date of the
merger; and
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- Millennium Predictive Medicine shall have obtained any necessary consent
or approval of any third party except where the failure to obtain such
consent or approval could not reasonably be expected to result in a
material adverse effect on Millennium Predictive Medicine.
TERMINATION
The merger agreement provides that prior to the effective time of the
merger, the merger agreement may be terminated:
- by mutual written consent of Millennium Pharmaceuticals and Millennium
Predictive Medicine;
- by either Millennium Pharmaceuticals or Millennium Predictive Medicine if:
(1) we do not complete the merger on or before December 31, 2000, except
that a party may not terminate the merger agreement for this reason
if its failure to fulfill its obligations is the cause of a merger
not being completed by December 31, 2000; or
(2) the other party is in breach of any representation, warranty or
covenant in the merger agreement and such breach is not cured within
20 days following delivery of a written notice of such breach.
AMENDMENTS AND WAIVERS
The parties to the merger agreement may mutually amend the merger agreement.
Any amendment must be in writing and signed by both parties. The merger
agreement permits Millennium Predictive Medicine and Millennium Pharmaceuticals
to mutually waive any inaccuracies in the representations of the other party and
waive compliance with any of the agreements or conditions contained in the
merger agreement. Millennium Predictive Medicine may only agree to amend the
merger agreement, or to grant a waiver, if the special merger committee of the
Millennium Predictive Medicine board of directors recommends such amendment or
waiver and the board of directors of Millennium Predictive Medicine approves
such amendment or waiver.
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INFORMATION CONCERNING MILLENNIUM PHARMACEUTICALS
Millennium Pharmaceuticals' goal is to become the biopharmaceutical company
of the future by building on its broad scientific and technological capabilities
and methods, which Millennium Pharmaceuticals calls its "technology platform,"
to develop breakthrough drugs.
We use many of the same elements of our technology platform throughout our
business, from discovery of disease-related genes, to development of drugs to
specifically address these diseases, to management of patients affected by these
diseases. As a result, we speak of our technological approach as being
applicable from "gene to patient." We continually seek to expand our technology
platform in an effort to increase the speed of drug discovery and development
and improve the resulting drugs.
Millennium Pharmaceuticals has entered into research, development and
commercialization arrangements, which we call "strategic alliances, with major
pharmaceutical and biotechnology companies relating to a broad range of
therapeutic products. These alliances provide Millennium Pharmaceuticals with
the opportunity to receive royalties and profit sharing if it and its partners
are successful in developing and commercializing products. In addition, these
alliances provide substantial fundings for Millennium Pharmaceuticals' research
and development programs and the continue enhancement of its technology
platform.
RECENT DEVELOPMENTS
On January 31, 2000, Millennium Pharmaceuticals' board of directors voted to
recommend to its stockholders that its corporate charter be amended to increase
the authorized number of shares of common stock from 100,000,000 shares to
500,000,000 shares. In addition, on January 31, 2000, Millennium
Pharmaceuticals' board of directors adopted, subject to stockholder approval,
its 2000 Stock Incentive Plan. The 2000 Stock Incentive Plan permits the
issuance of stock-based awards for a number of shares equal to 5% of the number
of shares of Millennium Pharmaceuticals' common stock outstanding on April 12,
2000, plus an annual increase equal to the lesser of 5% of the number of shares
of its common Stock outstanding on the last business day preceding January 1 in
each of 2001, 2002 and 2003 or a lesser number determined by the board of
directors. These proposals were approved at Millennium Pharmaceuticals' annual
meeting of stockholders held on April 12, 2000.
On February 28, 2000, Millennium Pharmaceuticals' board of directors
approved a two-for-one split of its common stock in the form of a stock
dividend. The record date for this dividend was March 28, 2000 and the dividend
distribution date was April 18, 2000.
On March 6, 2000, Millennium Pharmaceuticals entered into an agreement with
Abgenix, Inc. which provides it with access to Abgenix's XenoMouse-TM-
technology for the creation of fully human antibodies. Under this agreement,
Millennium Pharmaceuticals will have broad access to the XenoMouse-TM-
technology for research purposes as well as commercial use. Millennium
Pharmaceuticals has agreed to make an upfront payment and future payments that
could reach $100 million plus royalties on product sales for which it will
receive a specified number of commercial licenses.
ADDITIONAL INFORMATION
A detailed description of Millennium Pharmaceuticals' business, executive
compensation, various benefit plans, including stock option plans, voting
securities and the principal holders thereof, certain relationships and related
transactions, financial statements and other matters related to Millennium
Pharmaceuticals is incorporated by reference from filings made by Millennium
Pharmaceuticals with the SEC. See "Where You Can Find More Information."
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<PAGE>
INFORMATION CONCERNING MILLENNIUM PREDICTIVE MEDICINE
BUSINESS
OVERVIEW. Millennium Predictive Medicine, Inc. was organized as a Delaware
corporation in September 1997. Millennium Predictive Medicine seeks to develop
products and services that will provide clinicians and pharmaceutical
researchers with information that enables them to make better informed decisions
about drug treatment and other aspects of patient management. Our core areas of
focus include Diagnomics-TM- products and pharmacogenomics. A Diagnomics-TM-
product is a gene-based diagnostic test to determine the patient's medical
status and facilitate cost-effective treatment. Pharmacogenomics is the
identification of genes, or their activity, associated with responsiveness to
particular drugs. We believe that the products and services being developed by
Millennium Predictive Medicine will enable physicians to customize medical
treatment by providing them with improvements in predicting and monitoring
disease as well as the ability to identify the genetic basis for a patient's
disease and select the most appropriate drugs for the particular patient.
When used in this section, the terms "we," "us" and "our" refer to
Millennium Predictive Medicine.
DIAGNOMIC-TM- PRODUCTS. Many current diagnostic tests are directed towards
the symptoms, rather than the causes, of the diseases that they are used to
diagnose or monitor. As a result, these tests generally provide information only
about a patient's current condition. In contrast, we are developing gene-based
diagnostic tests, which we call Diagnomics-TM- tests, to assess the underlying
causes of diseases. We believe that Diagnomics-TM- products and services will
provide information with inherent prognostic, therapeutic and economic
implications, facilitating a shift in medical care towards planned and
cost-effective treatment of the underlying causes of disease.
The initial focus for Millennium Predictive Medicine's Diagnomics-TM-
program is cancer. In February 1999, MPMx entered into a strategic alliance with
Becton Dickinson focused primarily on Diagnomics-TM- products for cancer. In
conjunction with Becton Dickinson, Millennium Predictive Medicine has developed
the Melastatin-TM- detection product, a clinical marker that may be used to
assess melanoma. Becton Dickinson plans to introduce the Melastatin-TM-
detection product to the market by the end of 2000. Although the potential
market for the Melastatin-TM- detection product is small, we believe that the
introduction of this product will provide initial validation of our
Diagnomics-TM- approach.
PHARMACOGENOMICS. Different people often respond in different ways to the
same drug. A drug that is safe and effective in one patient may be toxic or
ineffective in another. We believe that these differences in response reflect
underlying genetic differences between the individuals concerned.
Pharmacogenomic studies seek to establish correlations between specific genetic
variations and specific responses to drugs. By establishing such correlations,
pharmacogenomics may permit both new and existing drugs to be targeted to those
patients in whom they are most likely to be both effective and safe. In
November 1999, Millennium Predictive Medicine entered into a strategic alliance
with Bristol-Myers Squibb focused primarily on the application of
pharmacogenomics to cancer treatments.
TECHNOLOGY. We use a number of technologies and approaches in our research
discovery programs. These include:
- Bench biology--various approaches, using cellular models or human tissue,
for the experimental validation or development of hypotheses that
particular genes or proteins could be good Diagnomic-TM- or
pharmacogenomic markers.
- Computational biology--the rapid analysis of the DNA sequences of genes to
identify those which encode potential genes that may be useful as
Diagnomic-TM- or pharmacogenomic markers, and methodologies for the
assignment of biochemical functions and disease roles to genes.
39
<PAGE>
- High-throughput sequencing--a highly automated process that enables the
rapid determination of DNA sequence information from large numbers of
genes that may be appropriate Diagnomic-TM- or pharmacogenomic markers.
- Human genetics--techniques that involve the identification of genes or
differences in DNA sequence between individuals that may be appropriate
Diagnomic-TM- or pharmacogenomic markers.
- Pathway profiling--identification of multiple genes that may be involved
in the initiation, progression or maintenance of a disease.
- Proteomics--the identification of proteins, or changes to proteins,
associated with particular diseases or response to specific therapeutics.
- Transcriptional profiling--the rapid identification of genes whose
activity in the body changes under disease conditions or in response to
specific therapeutics.
AGREEMENTS WITH MILLENNIUM PHARMACEUTICALS. Millennium Predictive Medicine
has entered into several agreements with Millennium Pharmaceuticals which relate
to the transfer and licensing of technology and trademarks, collaborating with
respect to aspects of our research, and the purchasing of services from
Millennium Pharmaceuticals. These agreements are currently in place. If the
proposed merger becomes effective, it is possible that certain provisions of
these agreements could be amended in the future or that some or all of the
agreements could be canceled at the discretion of Millennium Pharmaceuticals.
The agreements are summarized below.
RIGHTS EXCHANGE AGREEMENT. The Rights Exchange Agreement provides that we
will transfer and assign to each other existing and future rights for use in our
respective core fields. The Millennium Predictive Medicine core fields include
diagnostics and Diagnomics-TM-, pharmacogenomics services, and patient
management. The Millennium Pharmaceuticals core fields include all other areas
in which Millennium Pharmaceuticals technology may be applied, including human
therapeutics, veterinary medicine, and agriculture. In particular, we and
Millennium Pharmaceuticals have agreed:
- To transfer and assign to us the retained rights under Millennium
Pharmaceuticals existing collaboration agreements that are in our core
field,
- To transfer, assign and/or license to each other all future product
development opportunities and technology rights developed or acquired
during the agreement term to the extent applicable to our respective core
fields, and
- To use reasonable efforts when negotiating third party collaboration
agreements to limit the licenses and rights granted to the third party in
the core field of the other party, except when such limitation of license
grant would have a material impact on either the willingness of the third
party to enter into the collaboration agreement or on the financial terms
of the collaboration agreement.
- The agreement has a term which ends on the later of February 1, 2004 or
the date on which we cease to be an affiliate of Millennium
Pharmaceuticals.
TECHNOLOGY TRANSFER AGREEMENT. The Technology Transfer and License
Agreement provides that we will transfer technology and grant licenses to each
other for use in our respective core fields. In particular, we and Millennium
Pharmaceuticals have agreed:
- To transfer to each other product specific development opportunities and
technology rights, including, opportunities and rights that arise under
collaboration agreements with third parties,
- To grant to each other a royalty-free, non-exclusive license to technology
relating to the research and development of genes and proteins in our
respective core fields, and
40
<PAGE>
- To grant to each other a royalty-free, exclusive license to technology
relating to the development, manufacture and/or commercialization of
products in our respective core fields.
The agreement has a term which ends on the later of February 1, 2004 or the date
on which we cease to be an affiliate of Millennium Pharmaceuticals.
ADMINISTRATIVE SERVICES AGREEMENT. The Administrative Services Agreement
provides for us to reimburse Millennium Pharmaceuticals on a monthly basis for
the actual direct and indirect cost of certain services provided to us by
Millennium Pharmaceuticals. These services include accounting and bookkeeping,
payroll, human resources support services, data processing development and
implementation, legal services, and public and investor relations services. The
agreement may be terminated by Millennium Pharmaceuticals under certain
conditions including a public offering of Millennium Predictive Medicine that
realizes provides gross proceeds of at least $15,000,000 to Millennium
Predictive Medicine or such time as Millennium Predictive Medicine is no longer
an affiliate of Millennium Pharmaceuticals. In addition, either of us can
terminate at any time if there is a breach of the agreement.
RESEARCH SERVICES AND COLLABORATION AGREEMENT. Under the Research Services
and Collaboration Agreement we and Millennium Pharmaceuticals have agreed to
provide specified research services to each other. We and Millennium
Pharmaceuticals will reimburse each other for all direct and indirect actual
costs of the services provided. Neither we nor Millennium Pharmaceuticals is
obligated to provide services to the other if it would result in an unreasonable
burden on the party performing the service. We and Millennium Pharmaceuticals
also have agreed to engage in mutually agreed upon collaborative research
activities, including in the areas of developing automated research tools and
other computer-based research programs. The agreement terminates at such time as
Millennium Predictive Medicine is no longer an affiliate of Millennium
Pharmaceuticals, and either Millennium Predictive Medicine or Millennium
Pharmaceuticals can terminate at any time if there is a breach of the agreement.
TRADEMARK LICENSE AGREEMENT. The Trademark License Agreement provides for
the grant by Millennium Pharmaceutics to us of a co-exclusive license to use the
trademarks "Millennium" and "Millennium Predictive Medicine." When we are no
longer an affiliate of Millennium Pharmaceuticals, Millennium Pharmaceuticals
can terminate the license on 90 days' written notice. However, the license can
be terminated earlier if we become insolvent or fail to meet quality standards
which have been imposed by Millennium Pharmaceuticals with respect to the
trademarks.
TAX SHARING AGREEMENT. The Tax Sharing Agreement provides for the
allocation, payment and reimbursement of taxes between us and Millennium
Pharmaceuticals on a consolidated basis.
STRATEGIC ALLIANCE AND OTHER AGREEMENTS. We are engaged in agreements with
third parties relating to our discovery programs. These agreements include the
following:
BECTON DICKINSON. In February 1999, we entered into an alliance with Becton
Dickinson to develop tests designed to provide individualized cancer diagnostic
and prognostic information, assist in treatment selection for patients with
cancer and improve the prediction of cancer patient healthcare outcomes. This
alliance provides research funding and license fees over a five year agreement
term, as well a future royalties from any products that are sold as a result of
the research and development program. In addition, Becton Dickinson made an
equity investment of $15 million in the capital stock of Millennium Predictive
Medicine, for which it received approximately 11% of our voting stock.
Under this collaboration, we plan to provide clinically validated diagnostic
markers to Becton Dickinson for skin, cervical, breast, ovarian, uterine,
prostate and colon cancers. A diagnostic marker is a molecule or substance whose
presence or concentration can be measured in a biological sample taken
41
<PAGE>
from a patient, providing useful information about the patient's status or
future prospects with respect to a particular disease or diseases.
BRISTOL-MYERS SQUIBB. In November 1999 Millennium Predictive Medicine
entered into an alliance with Bristol-Myers Squibb in the area of
pharmacogenomics for cancer treatment. This alliance provides research funding
and license fees over a five year agreement term, as well as future royalties.
We and Bristol-Myers Squibb are seeking to use genetic and related information
to develop new anti-cancer therapies to treat specific patient populations and
tumor types, as well as to tailor existing therapies to individual patients.
OTHER AGREEMENTS. We have entered into a number of consulting, material
transfer and collaboration agreements with academic investigators and
institutions, both on our own and in participation with Millennium
Pharmaceuticals. Included among these is an agreement with the Mayo Foundation
for Medical Education and Research that provides us access to clinical materials
and collaborative research. In connection with the agreement, the Mayo
Foundation has a warrant to purchase 50,000 shares of Millennium Predictive
Medicine common stock. This warrant will be converted to a warrant to purchase
20,000 shares of Millennium Pharmaceuticals common stock upon closing of the
merger.
OUTSTANDING STOCK; NO PUBLIC TRADING MARKET
There is currently no public trading market for shares of Millennium
Predictive Medicine's stock. As of April 18, 2000, there were a total of
8,750,000 shares of Series A convertible preferred stock and 750,000 shares of
Series B convertible preferred stock of Millennium Predictive Medicine
outstanding, all of which shares are owned by Millennium Pharmaceuticals, and
1,200,000 shares of Series C convertible preferred stock, all of which shares
are owned by Becton, Dickinson and Company. As of April 18, 2000, there were a
total of 200 shares of Class A common stock, all of which are owned by
Millennium Pharmaceuticals, and 1,595,025 shares of Class B common stock
outstanding. As of April 18, 2000, there were approximately 86 holders of
Class B common stock. As of April 18, 2000, there were options to purchase a
total of 457,990 shares of Class B common stock outstanding.
DIVIDEND POLICY
Millennium Predictive Medicine has never paid or declared any cash dividends
on its common stock or other securities and does not anticipate paying cash
dividends in the foreseeable future.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Millennium Predictive Medicine maintains an investment portfolio in
accordance with its investment policy. The primary objectives of this investment
policy are to preserve principal, maintain proper liquidity to meet operating
needs and maximize yields. Millennium Predictive Medicine's investment policy
specifies credit quality standards for Millennium Predictive Medicine's
investments and limits the amount of credit exposure to any single issue, issuer
or type of investment.
Millennium Predictive Medicine does not believe that it has any material
market risk exposure with respect to derivative or other financial instruments.
OTHER MATTERS
PATENTS. As of March 1, 2000, Millennium Predictive Medicine ownes
approximately 20 patent applications. These patent applications generally relate
to gene sequences that may be useful as disease markers. In addition, pursuant
to our license agreement with Millennium Pharmaceuticals we are licensed under
patents and patent applications owned by Millennium Pharmaceuticals in our core
fields of diagnostics, pharmacogenomics, and patient management. As of March 1,
2000 Millennium
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Pharmaceuticals held approximately 90 issued U.S. patents and 1,000 patent
applications, of which we estimate at least 60% may be relevant to our core
fields.
COMPETITION. We experience intense competition in our industry. Some of our
competitors may have better funding and more resources than we have. We believe
that the primary competitive factors relating to the products that we are
developing include proprietary (patent) position, clinical validity, regulatory
acceptance and distribution capabilities.
GOVERNMENT REGULATION. The Food and Drug Administration intensively
regulates our industry. Marketing our products outside the U.S. will likely
require the approval of foreign governmental regulating agencies. These factors
are discussed in the filings made by Millennium Pharmaceuticals with the SEC.
See "Where You Can Find More Information."
FACILITIES. We currently occupy approximately 23,000 square feet of
laboratory and office space in Millennium Pharmaceuticals' buildings in
Cambridge, Massachusetts.
EMPLOYEES. As of March 1, 2000, we had approximately 60 full-time employees
and were using the services of approximately 30 additional full-time employees
from other units within Millennium Pharmaceuticals.
EXECUTIVE OFFICERS AND
DIRECTORS OF MILLENNIUM PREDICTIVE MEDICINE
The following table sets forth the names, ages and positions of executive
officers, directors and key employees of Millennium Predictive Medicine who will
serve as executive officers, directors or key employees of Millennium
Pharmaceuticals following the merger. The information provided is current as of
March 31, 2000.
<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- -------- ----------------------
<S> <C> <C>
Mark J. Levin................................... 49 Director
Steven H. Holtzman.............................. 46 Director
Kenneth J. Conway............................... 51 President and Director
</TABLE>
MARK J. LEVIN has served as a director of Millennium Predictive Medicine
since its founding in 1997. Mr. Levin has served as a director of Millennium
Pharmaceuticals since 1993, Chairman of the board of directors of Millennium
Pharmaceuticals since March 1996 and Chief Executive Officer of Millennium
Pharmaceuticals since November 1994. From 1987 to 1994, Mr. Levin was a partner
at Mayfield Fund, a venture capital firm, and co-director of its Life Science
Group. While employed with Mayfield, Mr. Levin was the founding Chief Executive
Officer of several biotechnology and biomedical companies, including Cell
Genesys Inc., CytoTherapeutics Inc., Tularik Inc. and Focal, Inc. Mr. Levin
holds an M.S. in Chemical and Biomedical Engineering from Washington University.
Mr. Levin also serves on the Board of Directors of CytoTherapeutics Inc. and
Focal, Inc.
STEVEN H. HOLTZMAN has served as a director of Millennium Predictive
Medicine since its founding in 1997. Mr. Holtzman has served as Chief Business
Officer of Millennium Pharmaceuticals since May 1994. From 1986 to 1993,
Mr. Holtzman was with DNX Corporation, a biomedical company, and its
subsidiaries. He was a founder and the first employee of DNX, served as a member
of the Board of Directors, and held several senior management positions
including, from 1992 to 1993, President of DNX BioTherapeutics, Inc., a
subsidiary of DNX, and from 1990 to 1993, Executive Vice President of DNX.
Mr. Holtzman received his graduate B. Phil. degree in Philosophy from Oxford
University, which he attended as a Rhodes Scholar. Mr. Holtzman currently serves
as co-chairperson of the Biotechnology Industry Organization's Bioethics
Committee and is a member of the National Bioethics Advisory Commission.
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<PAGE>
KENNETH J. CONWAY has served as president and a director of Millennium
Predictive Medicine since its founding in September 1997. Mr. Conway previously
served for more than 26 years with Chiron Diagnostics Corporation (formerly Ciba
Corning), a medical diagnostics company. He was most recently Senior Vice
President and General Manager of Immuno Diagnostics from 1996 to 1997.
Previously, Mr. Conway was a Member of the Office of the President while
President of the U.S. group of Chiron from 1991 to 1996. Other positions he held
at Chiron include Vice President of several business units, as well as Vice
President of Manufacturing at the former Corning Medical.
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<PAGE>
SECURITY OWNERSHIP OF DIRECTORS, EXECUTIVE OFFICERS AND PRINCIPAL STOCKHOLDERS
OF MILLENNIUM PREDICTIVE MEDICINE
The following table sets forth, as of March 20, 2000, the security ownership
of the directors, executive officers and principal stockholders of Millennium
Predictive Medicine. Unless otherwise indicated, each person's address is in
care of Millennium Predictive Medicine, Inc., One Kendall Square, Building 700,
Cambridge, Massachusetts 02140. To the knowledge of Millennium Predictive
Medicine, the persons named in the table have sole voting and investment power
with respect to all shares of Millennium Predictive Medicine stock shown as
beneficially owned by them, subject to the information contained in the
footnotes to the table. Beneficial ownership is determined according to the
rules of the SEC. Shares of Millennium Predictive Medicine Class B common stock
subject to options currently exercisable or exercisable within sixty days from
the date of this table are deemed outstanding when determining the number of
shares and percentage ownership by the person holding these options.
45
<PAGE>
<TABLE>
<CAPTION>
NUMBER OF NUMBER OF NUMBER OF NUMBER OF
SHARES OF SHARES OF SHARES OF SHARES OF
CLASS A PERCENT CLASS B PERCENT SERIES A PERCENT SERIES B
COMMON OF COMMON OF PREFERRED OF PREFERRED
STOCK CLASS A STOCK CLASS B STOCK SERIES A STOCK
BENEFICIALLY COMMON BENEFICIALLY COMMON BENEFICIALLY PREFERRED BENEFICIALLY
NUMBER OF BENEFICIAL OWNER OWNED STOCK(1) OWNED STOCK(2) OWNED STOCK(3) OWNED
- -------------------------- ------------ -------- ------------ -------- ------------ --------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Millennium Pharmaceuticals, Inc. ..... 200 100% 0 0% 8,750,000 100% 750,000
75 Sidney Street
Cambridge, MA 02139
Becton, Dickinson and Company ........ 0 0% 0 0% 0 0% 0
1 Becton Drive
Franklin Lakes, NJ 07417
Kenneth J. Conway .................... 0 0% 571,210 35.8% 0 0% 0
Steven H. Holtzman ................... 0 0% 29,000 1.8% 0 0% 0
Mark J. Levin ........................ 0 0% 35,000(6) 2.2% 0 0% 0
Marcia Radosevich .................... 0 0% 6,667(7) * 0 0% 0
<CAPTION>
NUMBER OF
SHARES OF
PERCENT SERIES C PERCENT
OF PREFERRED OF PERCENTAGE
SERIES B STOCK SERIES C AGGREGATE
PREFERRED BENEFICIALLY PREFERRED VOTING
NUMBER OF BENEFICIAL OWNER STOCK(4) OWNED STOCK(5) POWER
- -------------------------- --------- ------------ --------- ----------
<S> <C> <C> <C> <C>
Millennium Pharmaceuticals, Inc. ..... 100% 0 0% 88.8%
75 Sidney Street
Cambridge, MA 02139
Becton, Dickinson and Company ........ 0% 1,200,000 100% 11.2%
1 Becton Drive
Franklin Lakes, NJ 07417
Kenneth J. Conway .................... 0% 0 0% 0%
Steven H. Holtzman ................... 0% 0 0% 0%
Mark J. Levin ........................ 0% 0 0% 0%
Marcia Radosevich .................... 0% 0 0% 0%
</TABLE>
- ------------------------------
* Less than one percent
(1) Based on 200 shares outstanding as of March 20, 2000.
(2) Based on 1,595,025 shares outstanding as of March 20, 2000.
(3) Based on 8,750,000 shares outstanding as of March 20, 2000.
(4) Based on 750,000 shares outstanding as of March 20, 2000.
(5) Based on 1,200,000 shares outstanding as of March 20, 2000.
(6) Includes 10,000 shares of Class B common stock issuable to Mr. Levin within
60 days after March 20, 2000 pursuant to the exercise of stock options.
(7) Consists of 6,667 shares of Class B common stock issuable to Ms. Radosevich
within 60 days after March 20, 2000 pursuant to the exercise of stock
options.
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<PAGE>
COMPARISON OF STOCKHOLDER RIGHTS
Both Millennium Predictive Medicine and Millennium Pharmaceuticals are
Delaware corporations and are governed by Delaware law. In addition, the rights
of Millennium Predictive Medicine stockholders are currently governed by the
Millennium Predictive Medicine certificate of incorporation, as amended, and the
Millennium Predictive Medicine bylaws, and the rights of Millennium
Pharmaceuticals stockholders are governed by the Millennium Pharmaceuticals
restated certificate of incorporation and the Millennium Pharmaceuticals bylaws.
After the effective time of the merger, the rights of stockholders of
Millennium Predictive Medicine who become holders of Millennium Pharmaceuticals
common stock will be governed by the Millennium Pharmaceuticals restated
certificate of incorporation, the Millennium Pharmaceuticals bylaws and Delaware
law. In most respects, the rights of holders of Millennium Predictive Medicine
Class B common stock (which is distinguished from Millennium Predictive Medicine
Class A common stock by the absence of voting rights) are similar to the rights
of holders of Millennium Pharmaceuticals common stock.
The following is a summary of the material differences between such rights.
This summary does not purport to be a complete discussion of, and is qualified
in its entirety by reference to, Delaware law as well as to the Millennium
Predictive Medicine certificate of incorporation, the Millennium Predictive
Medicine bylaws, the Millennium Pharmaceuticals restated certificate of
incorporation and the Millennium Pharmaceuticals bylaws, copies of which are on
file with the SEC.
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<PAGE>
SUMMARY OF MATERIAL DIFFERENCES BETWEEN CURRENT RIGHTS OF MILLENNIUM
PREDICTIVE MEDICINE STOCKHOLDERS AND RIGHTS THOSE STOCKHOLDERS WILL HAVE AS
MILLENNIUM PHARMACEUTICALS STOCKHOLDERS FOLLOWING THE MERGER
<TABLE>
<CAPTION>
MILLENNIUM PREDICTIVE MILLENNIUM PHARMACEUTICALS
MEDICINE STOCKHOLDER RIGHTS STOCKHOLDER RIGHTS
---------------------------------------- ----------------------------------------
<S> <C> <C>
Authorized Capital Stock: The authorized capital stock of The authorized capital stock of
Millennium Predictive Medicine consists Millennium Pharmaceuticals consists of
of 14,000,000 shares of Class A common 500 million shares of common stock and
stock, 2,300,000 shares of Class B five million shares of preferred stock.
common stock, 8,750,000 shares of Series
A preferred stock, 750,000 shares of
Series B preferred stock, 1,200,000
shares of Series C preferred stock,
590,000 shares of Series D preferred
stock and 409,800 shares of undesignated
preferred stock.
Number of Directors: The Millennium Predictive Medicine The Millennium Pharmaceuticals restated
certificate of incorporation and bylaws certificate of incorporation requires no
require Millennium Predictive Medicine less than three directors, and the
to have no less than one director, and Millennium Pharmaceuticals bylaws
provide for the Millennium Predictive provide that the total number of
Medicine stockholders or Board to have directors may be determined by the
the power to determine the total number. Millennium Pharmaceuticals Board. The
The Millennium Predictive Medicine Board Millennium Pharmaceuticals Board
currently consists of five directors. currently consists of eight directors.
Classification of Board of Directors: Millennium Predictive Medicine does not The Millennium Pharmaceuticals Board is
have a classified board. The Millennium divided into three classes, with each
Predictive Medicine bylaws require that class serving a staggered three year
all directors be elected for a one year term. There are currently two classes
term and until his or her successor is with three directors, and one class with
elected and qualified. no directors.
Removal of Directors: Pursuant to the Millennium Predictive The Millennium Pharmaceuticals restated
Medicine bylaws, any director or the certificate of incorporation provides
entire Millennium Predictive Medicine that directors may be removed only for
Board may be removed, either for or cause by the affirmative vote of the
without cause, at any time by the holders of at least two-thirds of all
affirmative vote of the holders of a outstanding shares of Millennium
majority of all outstanding shares of Pharmaceuticals stock entitled to vote.
Millennium Predictive Medicine stock
entitled to vote, except that a director
elected by the holders of a particular
class or series of stock may be removed
without cause only by a vote of the
holders of a majority of the outstanding
shares of such class or series.
</TABLE>
48
<PAGE>
<TABLE>
<CAPTION>
MILLENNIUM PREDICTIVE MILLENNIUM PHARMACEUTICALS
MEDICINE STOCKHOLDER RIGHTS STOCKHOLDER RIGHTS
---------------------------------------- ----------------------------------------
<S> <C> <C>
Amendment of Corporate Charter The Millennium Predictive Medicine The Millennium Pharmaceuticals restated
certificate of incorporation may be certificate of incorporation may be
amended by board resolution and an amended by the affirmative vote of
affirmative vote by holders of a holders of a majority of Millennium
majority of the Millennium Predictive Pharmaceuticals common stock
Medicine stock entitled to vote, except, outstanding, except with respect to
so long as at least an aggregate of proposals amending the Millennium
300,000 shares of Series C and Series D Pharmaceuticals certificate of
preferred stock remain outstanding, the incorporation to change the provisions
affirmative vote of at least a majority related to the Millennium
of the outstanding shares of Series C Pharmaceuticals Board of Directors,
and Series D preferred stock, voting stockholder voting by written consent
together as a single class, is required and special meetings of stockholders, in
for: each such case the affirmative
- amendments to the certificate of
incorporation that alter or change the
powers, preferences or special rights
of the Series A and Series B preferred
stock so as to make them superior to
the Series C or Series D preferred
stock as to voting, liquidation,
dividends, distributions, conversion
or otherwise;
- proposals to increase the number of vote of the holders of 75% of the shares
authorized shares of Series C or of Millennium Pharmaceuticals stock
Series D preferred stock; and entitlted to vote is required.
- proposals to pay or declare any
dividend on shares of Millennium
Predictive Medicine' stock or redeem
or repurchase any shares of its stock.
Proposals to alter or change the powers,
preferences or special rights of the
Class B common Stock require the
approval of a majority of the
outstanding shares of Class B common
stock.
Amendment of Bylaws: The Millennium Predictive Medicine Except as provided below, the Millennium
bylaws may be altered or repealed by the Pharmaceuticals restated bylaws may be
holders of Millennium Predictive amended, and new bylaws may be adopted,
Medicine voting stock or by the by Millennium Pharmaceuticals
Millennium Predictive Medicine board of stockholders or the Millennium
directors. The Millennium Predictive Pharmaceuticals Board. The Millennium
Medicine bylaws state that any Pharmaceuticals restated bylaws state
alteration of the Millennium Predictive that all such amendments voted on by the
Medicine bylaws by holders of Millennium Millennium Pharmaceuticals stockholders
Predictive Medicine voting stock must be approved by holders of a
requires the affirmative vote of at majority of all outstanding Millennium
least a majority of the voting power of Pharmaceuticals stock.
all outstanding stock entitled to vote.
</TABLE>
49
<PAGE>
<TABLE>
<CAPTION>
MILLENNIUM PREDICTIVE MILLENNIUM PHARMACEUTICALS
MEDICINE STOCKHOLDER RIGHTS STOCKHOLDER RIGHTS
---------------------------------------- ----------------------------------------
<S> <C> <C>
Certain provisions of the Millennium
Pharmaceuticals bylaws regarding the
powers and election of directors and
amendments to the bylaws require the
affirmative vote of 75% of the voting
power of all outstanding stock entitled
to vote in order to be amended by a vote
of stockholders.
Voting Stock The outstanding Millennium Predictive The outstanding Millennium
Medicine voting stock consists of Pharmaceuticals voting stock consists
Millennium Predictive Medicine Class A solely of Millennium Pharmaceuticals
common stock and Series A, Series B and common stock.
Series C preferred stock.
Indemnification and Exculpation of Pursuant to its certificate of The Millennium Pharmaceuticals restated
Directors and Officers: incorporation, Millennium Predictive certificate of incorporation provides
Medicine will indemnify any director or that Millennium Pharmaceuticals will
officer of Millennium Predictive indemnify to the fullest extent
Medicine (or any director, officer, permitted by law any person made, or
employee or agent of another entity if threatened to be made, party to an
serving at the request of Millennium action or proceeding by reason of the
Predictive Medicine) to the fullest fact that he is or was a director or
extent permitted by Delaware law, officer of Millennium Pharmaceuticals or
provided that, if the person seeks that such director or officer was
indemnification in connection with a serving any other entity in any capacity
proceeding that he or she initiated, the at the request of Millennium
Millennium Predictive Medicine board of Pharmaceuticals. The Millenium
directors approved the proceeding. Pharmaceuticals certificate of
incorporation further provides that no
director shall be personally liable to
Millenium Pharmaceuticals or its
stockholders for monetary damages for
any breach of fiduciary duty.
Business Combination Prohibitions: The Millennium Predictive Medicine The Millennium Pharmaceuticals restated
certificate of incorporation provides certificate authorizes the board of
that a merger, consolidation or sale of directors to issue "blank check"
all or substantially all of the assets preferred stock without any need for
of Millennium Predictive Medicine will action by Millennium Pharmaceuticals'
constitute a liquidation requiring a stockholders.
cash payment to the holders of Series A,
Series B, Series C and Series D
preferred stock for each share of
preferred stock owned by such
stockholder.
Special Meetings of Stockholders: Special meetings of Millennium The Millennium Pharmaceuticals restated
Predictive Medicine stockholders may bylaws provide that the chairman, the
only be called by the President or by chief executive officer or the
the Millennium Predictive Medicine board Millennium Pharmaceuticals Board may
of directors. call a special meeting.
</TABLE>
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<TABLE>
<CAPTION>
MILLENNIUM PREDICTIVE MILLENNIUM PHARMACEUTICALS
MEDICINE STOCKHOLDER RIGHTS STOCKHOLDER RIGHTS
---------------------------------------- ----------------------------------------
<S> <C> <C>
Action of Stockholders Without a Any action required or permitted to be The Millennium Pharmaceuticals restated
Meeting: taken at an annual or special meeting of bylaws provide that the stockholders of
Millennium Predictive Medicine Millennium Pharmaceuticals may not take
stockholders may be taken without a any action by written consent in lieu of
meeting if a written consent to the a meeting.
action is signed by a number of
stockholders having at least as many
votes as would be required to authorize
the action at a meeting.
</TABLE>
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<PAGE>
EXPERTS
Ernst & Young LLP, independent auditors, have audited Millennium
Pharmaceuticals' consolidated financial statements included in Millennium
Pharmaceuticals' Annual Report on Form 10-K for the year ended December 31,
1999, as set forth in their report, which is incorporated by reference in this
prospectus and elsewhere in the registration statement. Our financial statements
are incorporated by reference in reliance on Ernst & Young LLP's report, given
on their authority as experts in accounting and auditing.
The consolidated financial statements of LeukoSite, Inc. as of December 3,
1997 and 1998 and for each of the three years in the period ended December 31,
1998 and the financial statements of L&I Partners, L.P. as of December 31, 1997
and 1998 and for the period from inception through December 31, 1997, the year
ended December 31, 1998 and the period from inception through December 31, 1998
incorporated by reference in this prospectus and elsewhere in the registration
statement have been audited by Arthur Andersen LLP, independent public
accountants, as indicated in their reports with respect thereto, and are
included herein in reliance upon the authority of said firm as experts in giving
said reports.
The financial statements of CytoMed, Inc. as of December 31, 1998 and 1997
and for each of the three years in the period ended December 31, 1998
incorporated in this prospectus by reference to the Millennium Pharmaceuticals
Form 8-K/A dated January 6, 2000, have been so incorporated in reliance on the
report of PricewaterhouseCoopers LLP, independent accountants, given on the
authority of said firm as experts in auditing and accounting.
LEGAL MATTERS
The validity of the shares of Millennium Pharmaceuticals common stock to be
issued in the merger will be passed upon for Millennium Pharmaceuticals by Hale
and Dorr LLP, Boston, Massachusetts, counsel to Millennium Pharmaceuticals.
Certain legal matters with respect to the federal income tax consequences of the
merger will be passed upon for Millennium Pharmaceuticals and Millennium
Predictive Medicine by Hale and Dorr LLP, Boston, Massachusetts.
WHERE YOU CAN FIND MORE INFORMATION
Millennium Pharmaceuticals files annual, quarterly and special reports,
proxy statements and other information with the SEC. You may read and copy any
reports, statements or other information that we have filed at the SEC's public
reference rooms. Please call the SEC at 1-800-SEC-0330 for information on the
public reference rooms or visit the following locations of the SEC:
<TABLE>
<S> <C> <C>
Public Reference Room New York Regional Office Chicago Regional Office
450 Fifth Street, N.W. 7 World Trade Center Citicorp Center
Room 1024 Suite 1300 500 West Madison Street
Washington, DC 20549 New York, New York 10048 Suite 1400
Chicago, Illinois 60661-2511
</TABLE>
You may also obtain copies of this information by mail from the Public
Reference Section of the SEC, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549, at prescribed rates. Our SEC filings are also available to the
public from commercial document retrieval services and at the web site
maintained by the SEC at http://www.sec.gov.
Millennium Pharmaceuticals filed a registration statement on Form S-4 to
register with the SEC Millennium Pharmaceuticals common stock that may be issued
to Millennium Predictive Medicine stockholders in the merger. This information
statement/prospectus is a part of that registration statement and constitutes a
prospectus of Millennium Pharmaceuticals in addition to being an
53
<PAGE>
information statement of Millennium Predictive Medicine. As allowed by SEC
rules, this information statement/prospectus does not contain all the
information you can find in the registration statement or the exhibits to the
registration statement.
The SEC allows Millennium Pharmaceuticals to "incorporate by reference"
information into this information statement/prospectus, which means important
information may be disclosed to you by referring you to another document filed
separately with the SEC. The information incorporated by reference is deemed to
be part of this information statement/prospectus, except for any information
superseded by information in (or incorporated by reference in) this
statement/prospectus. This information statement/prospectus incorporates by
reference the documents set forth below that have been previously filed with the
SEC. These documents contain important information about our companies and their
financial condition.
<TABLE>
<CAPTION>
MILLENNIUM PHARMACEUTICALS SEC FILINGS
(FILE NO. 0-28494) DATE OR PERIOD COVERED
- --------------------------------------------- ---------------------------------------------
<S> <C>
Annual Report on Form 10-K................... Year ended December 31, 1999
Current Report on Form 8-K/A................. As filed with the SEC on January 6, 2000
Current Report on Form 8-K................... As filed with the SEC on January 6, 2000
Current Report on Form 8-K................... As filed with the SEC on January 11, 2000
Current Report on Form 8-K................... As filed with the SEC on January 19, 2000
Current Report on Form 8-K/A................. As filed with the SEC on January 27, 2000
Current Report on Form 8-K................... As filed with the SEC on February 9, 2000
Current Report on Form 8-K................... As filed with the SEC on April 13, 2000
Current Report on Form 8-K................... As filed with the SEC on April 25, 2000
Form 8-A..................................... Dated April 26, 1996
</TABLE>
Millennium Pharmaceuticals is also incorporating by reference additional
documents that it may file with the SEC pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934 between the date of this
information statement/prospectus and the effective time of the merger. These
include periodic reports, such as annual reports on Form 10-K, quarterly reports
on Form 10-Q and current reports on Form 8-K, as well as proxy statements.
Millennium Pharmaceuticals has supplied all information contained or
incorporated by reference in this information statement/prospectus relating to
Millennium Pharmaceuticals, and Millennium Predictive Medicine has supplied all
information contained in this information statement/prospectus relating to
Millennium Predictive Medicine.
You can obtain any of the documents incorporated by reference through us,
the SEC, or the SEC Internet world wide web site as described above. Documents
incorporated by reference are available from us without charge, excluding all
exhibits unless we have specifically incorporated by reference an exhibit in
this information statement/prospectus. Stockholders may obtain documents
incorporated by reference in this information statement/prospectus by requesting
them in writing or by telephone from us at the following address:
Millennium Pharmaceuticals, Inc.
75 Sidney Street
Cambridge, MA 02139
Tel.: (617) 679-7000
Attention: Corporate Secretary
website: http://www.mlmn.com
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<PAGE>
If you would like to request documents from us, please do so by ,
2000 to receive them before the effective time of the merger. If you request any
incorporated documents from us, we will mail them to you by first class mail, or
another equally prompt means, within one business day after we receive your
request.
We have authorized no one to give you any information or to make any
representation about the proposed merger involving our companies that differs
from or adds to the information contained in this information
statement/prospectus or in the documents our companies have publicly filed with
the SEC. Therefore, if anyone should give you any different or additional
information, you should not rely on it.
If you live in a jurisdiction where it is unlawful to offer to exchange or
sell, or to ask for offers to exchange or buy, the securities offered by this
information statement/prospectus, or to ask for proxies, or, if you are a person
to whom it is unlawful to direct such activities, then the offer presented by
this information statement/prospectus does not extend to you.
The information contained in this document speaks only as of the date
indicated on the cover of this document unless the information specifically
indicates that another date applies.
55
<PAGE>
APPENDIX A
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
MILLENNIUM PHARMACEUTICALS, INC.,
MPMX ACQUISITION CORP.
AND
MILLENNIUM PREDICTIVE MEDICINE, INC.
MARCH 1, 2000
A-1
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C> <C>
ARTICLE I--THE MERGER............................................. A-4
1.1 The Merger............................................ A-4
1.2 The Closing........................................... A-4
1.3 Actions at the Closing................................ A-4
1.4 Additional Action..................................... A-4
1.5 Conversion of Shares.................................. A-5
1.6 Dissenting Shares..................................... A-5
1.7 Exchange of Shares.................................... A-6
1.8 Fractional Shares..................................... A-7
1.9 Options............................................... A-7
1.10 Warrant............................................... A-7
1.11 Certificate of Incorporation.......................... A-8
1.12 Bylaws................................................ A-8
1.13 Directors and Officers................................ A-8
1.14 No Further Rights..................................... A-8
1.15 Closing of Transfer Books............................. A-8
1.16 Consent to Assignment................................. A-8
ARTICLE II--REPRESENTATIONS AND WARRANTIES OF THE COMPANY......... A-8
2.1 Organization, Qualification and Corporate Power....... A-8
2.2 Capitalization........................................ A-9
2.3 Authorization of Transaction.......................... A-9
2.4 Noncontravention...................................... A-9
2.5 Opinion of Financial Advisor.......................... A-10
ARTICLE III--REPRESENTATIONS AND WARRANTIES OF THE BUYER.......... A-10
3.1 Organization, Qualification and Corporate Power....... A-10
3.2 Capitalization........................................ A-10
3.3 Authorization of Transaction.......................... A-10
3.4 Noncontravention...................................... A-11
3.5 Reports and Financial Statements...................... A-11
3.6 Absence of Material Adverse Changes................... A-11
3.7 Litigation............................................ A-11
ARTICLE IV--COVENANTS............................................. A-12
4.1 Closing Efforts....................................... A-12
4.2 Prospectus/Information Statement and Registration
Statement................................................... A-12
4.3 Operation of Business................................. A-12
4.4 Listing of Buyer Common Stock......................... A-12
4.5 Indemnification....................................... A-12
4.6 Agreements from Certain Affiliates of the Company..... A-13
4.7 Amendment to Collaboration Agreement.................. A-13
ARTICLE V--CONDITIONS TO CONSUMMATION OF MERGER................... A-13
5.1 Conditions to Each Party's Obligations................ A-13
5.2 Conditions to Obligations of the Buyer and the
Acquisition Subsidiary...................................... A-14
5.3 Conditions to Obligations of the Company.............. A-14
ARTICLE VI--TERMINATION........................................... A-14
6.1 Termination of Agreement.............................. A-14
6.2 Effect of Termination................................. A-15
</TABLE>
A-2
<PAGE>
<TABLE>
<S> <C> <C>
ARTICLE VII--DEFINITIONS.......................................... A-16
ARTICLE VIII--MISCELLANEOUS....................................... A-16
8.1 Survival.............................................. A-16
8.2 No Third Party Beneficiaries.......................... A-17
8.3 Entire Agreement...................................... A-17
8.4 Succession and Assignment............................. A-17
8.5 Counterparts and Facsimile Signature.................. A-17
8.6 Headings.............................................. A-17
8.7 Notices............................................... A-17
8.8 Governing Law......................................... A-17
8.9 Amendments and Waivers................................ A-18
8.10 Severability.......................................... A-18
8.11 Submission to Jurisdiction............................ A-18
8.12 Waiver of Right to Trial by Jury...................... A-18
8.13 Construction.......................................... A-18
</TABLE>
A-3
<PAGE>
AGREEMENT AND PLAN OF MERGER
Agreement entered into as of March 1, 2000 by and among Millennium
Pharmaceuticals, Inc., a Delaware corporation (the "Buyer"), MPMX Acquisition
Corp., a Delaware corporation and wholly-owned subsidiary of the Buyer (the
"Acquisition Subsidiary"), and Millennium Predictive Medicine, Inc., a Delaware
corporation (the "Company"). The Buyer, the Acquisition Subsidiary and the
Company are referred to collectively herein as the "Parties."
This Agreement contemplates a merger of the Company with and into the
Acquisition Subsidiary. In such merger, the stockholders of the Company other
than the Buyer will receive common stock of the Buyer in exchange for their
capital stock of the Company. The Parties intend that the merger will qualify as
a tax-free "reorganization" within the meaning of Section 368(a)(1)(A) of the
Internal Revenue Code of 1986, as amended (the "Code"), by reason of
Section 368(a)(2)(D) thereof.
NOW, THEREFORE, in consideration of the representations, warranties and
covenants and recitals herein contained, the Parties agree as follows.
ARTICLE I
THE MERGER
1.1 THE MERGER. Upon and subject to the terms and conditions of this
Agreement, the Company shall merge with and into the Acquisition Subsidiary
(with such merger referred to herein as the "Merger") at the Effective Time (as
defined below). From and after the Effective Time, the separate corporate
existence of the Company shall cease and the Acquisition Subsidiary shall
continue as the surviving corporation in the Merger (the "Surviving
Corporation"). The "Effective Time" shall be the time at which the Surviving
Corporation files a certificate of merger or other appropriate documents
prepared and executed in accordance with the relevant provisions of the Delaware
General Corporation Law (the "Certificate of Merger") with the Secretary of
State of the State of Delaware. The Merger shall have the effects set forth in
Section 259 of the Delaware General Corporation Law.
1.2 THE CLOSING. The closing of the transactions contemplated by this
Agreement (the "Closing") shall take place at the offices of Hale and Dorr LLP
in Boston, Massachusetts, commencing at 9:00 a.m. local time on the 20th
business day following the mailing to the stockholders of the Company of the
Prospectus/Information Statement (as defined in Section 4.2), or, if all of the
conditions to the obligations of the Parties to consummate the transactions
contemplated hereby have not been satisfied or waived by such date, on such
mutually agreeable later date as soon as practicable (and in any event not later
than three business days) after the satisfaction or waiver of all conditions
(excluding the delivery of any documents to be delivered at the Closing by any
of the Parties) set forth in Article V hereof (the "Closing Date").
1.3 ACTIONS AT THE CLOSING. At the Closing:
(a) the Surviving Corporation shall file the Certificate of Merger with
the Secretary of State of the State of Delaware; and
(b) the Buyer shall deliver a certificate representing the shares of
Buyer Common Stock (as defined below) to be issued in the Merger to a bank
trust company or other entity reasonably satisfactory to the Company
appointed by the Buyer to act as the exchange agent (the "Exchange Agent")
in accordance with Section 1.7.
1.4 ADDITIONAL ACTION. The Surviving Corporation may, at any time after
the Effective Time, take any action, including executing and delivering any
document, in the name and on behalf of either the Company or the Acquisition
Subsidiary, in order to consummate the transactions contemplated by this
Agreement.
A-4
<PAGE>
1.5 CONVERSION OF SHARES. At the Effective Time, by virtue of the Merger
and without any action on the part of any Party or the holder of any of the
following securities:
(a) Each share of the Company's Class A Common Stock, $.001 par value
per share, Class B Common Stock, $.001 par value per share, and Preferred
Stock, $.001 par value per share ("Company Shares"), issued and outstanding
immediately prior to the Effective Time (other than Company Shares owned
beneficially by the Buyer, Dissenting Shares (as defined below) and Company
Shares held in the Company's treasury) shall be converted into and represent
the right to receive a number of shares of common stock, $.001 par value per
share, of the Buyer ("Buyer Common Stock") equal to the product of one share
of Buyer Common Stock times the Conversion Ratio. The "Conversion Ratio"
shall mean two-tenths (0.2).
(b) Each share of capital stock of the Company held in its treasury
immediately prior to the Effective Time and each share of capital stock of
the Company owned beneficially by the Buyer shall be cancelled and retired
without payment of any consideration therefor.
(c) In the event of any split, combination or reclassification of the
outstanding Buyer Common Stock or any issuance of any other securities in
exchange or in substitution for outstanding shares of Buyer Common Stock at
any time during the period from the date of this Agreement to the Effective
Time or if a record date occurs with respect to any of the foregoing that is
after the date of this Agreement and on or prior to the Effective Time,
appropriate adjustment shall be made to the Conversion Ratio and/or the
consideration to be received in the Merger by the stockholders of the
Company so as to preserve for the stockholders of the Company the economic
benefits expected to be received as a result of the consummation of the
Merger.
1.6 DISSENTING SHARES.
(a) For purposes of this Agreement, "Dissenting Shares" means Company
Shares held by a stockholder of record immediately prior to the Effective
Time (a "Company Stockholder") and with respect to which appraisal shall
have been duly demanded and perfected in accordance with Section 262 of the
Delaware General Corporation Law and not effectively withdrawn or forfeited.
Dissenting Shares shall not be converted into or represent the right to
receive Buyer Common Stock, unless such Company Stockholder shall have
forfeited his, her or its right to appraisal under the Delaware General
Corporation Law or properly withdrawn, his, her or its demand for appraisal.
If such Company Stockholder has so forfeited or withdrawn his, her or its
right to appraisal of Dissenting Shares, then (i) as of the occurrence of
such event, such holder's Dissenting Shares shall cease to be Dissenting
Shares and shall be converted into and represent the right to receive the
Buyer Common Stock issuable in respect of such Company Shares pursuant to
Section 1.5, and (ii) if such event occurs after the Effective Time,
promptly following the occurrence of such event, the Buyer shall deliver to
the Exchange Agent a certificate representing the Buyer Common Stock to
which such holder is entitled pursuant to Section 1.5.
(b) The Company shall give the Buyer (i) prompt notice of any written
demands for appraisal of any Company Shares, withdrawals of such demands,
and any other instruments that relate to such demands received by the
Company and (ii) the opportunity to direct all negotiations and proceedings
with respect to demands for appraisal under the Delaware General Corporation
Law. The Company shall not, except with the prior written consent of the
Buyer, make any payment with respect to any demands for appraisal of Company
Shares or offer to settle or settle any such demands.
(c) Within two (2) business days of the effectiveness of any written
consent of the stockholders of the Company approving the Merger and adopting
this Agreement, the Company shall send written notice of such approval and
adoption to those stockholders of the Company not executing such consent as
required by Section 228 of the Delaware General Corporation Law.
A-5
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1.7 EXCHANGE OF SHARES.
(a) Prior to the Effective Time, the Buyer shall appoint the Exchange
Agent to effect the exchange for the Buyer Common Stock of certificates
that, immediately prior to the Effective Time, represented Company Shares
converted into Buyer Common Stock pursuant to Section 1.5 (including any
Company Shares referred to in clause (i) of the last sentence of
Section 1.6(a)) ("Certificates"). On the Closing Date, the Buyer shall
deliver to the Exchange Agent, in trust for the benefit of holders of
Certificates, a stock certificate (issued in the name of the Exchange Agent
or its nominee) representing the Buyer Common Stock, as described in
Section 1.5. As soon as practicable after the Effective Time, the Buyer
shall cause the Exchange Agent to send a notice and a transmittal form to
each holder of a Certificate advising such holder of the effectiveness of
the Merger and the procedure for surrendering to the Exchange Agent such
Certificate in exchange for the Buyer Common Stock issuable pursuant to
Section 1.5. Each holder of a Certificate, upon proper surrender thereof to
the Exchange Agent in accordance with the instructions in such notice, shall
be entitled to receive in exchange therefor (subject to any taxes required
to be withheld) the Buyer Common Stock issuable pursuant to Section 1.5 plus
cash in lieu of any fractional shares, as provided in Section 1.8 below.
Until properly surrendered, each such Certificate shall be deemed for all
purposes to evidence only the right to receive a certificate for the Buyer
Common Stock issuable pursuant to Section 1.5. Holders of Certificates shall
not be entitled to receive certificates for the Buyer Common Stock to which
they would otherwise be entitled until such Certificates are properly
surrendered.
(b) If any Buyer Common Stock is to be issued in the name of a person
other than the person in whose name the Certificate surrendered in exchange
therefor is registered, it shall be a condition to the issuance of such
Buyer Common Stock that (i) the Certificate so surrendered shall be
transferable, and shall be properly assigned, endorsed or accompanied by
appropriate stock powers, (ii) such transfer shall otherwise be proper and
(iii) the person requesting such transfer shall pay to the Exchange Agent
any transfer or other taxes payable by reason of the foregoing or establish
to the satisfaction of the Exchange Agent that such taxes have been paid or
are not required to be paid. Notwithstanding the foregoing, neither the
Exchange Agent nor any Party shall be liable to a holder of Company Shares
for any Buyer Common Stock issuable to such holder pursuant to Section 1.5
that is delivered to a public official pursuant to applicable abandoned
property, escheat or similar laws.
(c) In the event any Certificate shall have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the person
claiming such Certificate to be lost, stolen or destroyed, the Buyer shall
issue in exchange for such lost, stolen or destroyed Certificate the Buyer
Common Stock issuable in exchange therefor pursuant to Section 1.5. The
Board of Directors of the Buyer may, in its discretion and as a condition
precedent to the issuance thereof, require the owner of such lost, stolen or
destroyed Certificate to give the Buyer a bond in such sum as it may direct
as indemnity against any claim that may be made against the Buyer with
respect to the Certificate alleged to have been lost, stolen or destroyed.
(d) No dividends or other distributions that are payable to the holders
of record of Buyer Common Stock as of a date on or after the Closing Date
shall be paid to former Company Stockholders entitled by reason of the
Merger to receive Buyer Common Stock until such holders surrender their
Certificates for certificates representing the Buyer Common Stock. Upon such
surrender, the Buyer shall pay or deliver to the persons in whose name the
certificates representing such Buyer Common Stock are issued any dividends
or other distributions that are payable to the holders of record of Buyer
Common Stock as of a date on or after the Closing Date and which were paid
or delivered between the Effective Time and the time of such surrender;
provided that no such person shall be entitled to receive any interest on
such dividends or other distributions.
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<PAGE>
1.8 FRACTIONAL SHARES. No certificates or scrip representing fractional
Buyer Common Stock shall be issued to former Company Stockholders upon the
surrender for exchange of Certificates, and such former Company Stockholders
shall not be entitled to any voting rights, rights to receive any dividends or
distributions or other rights as a stockholder of the Buyer with respect to any
fractional shares of Buyer Common Stock that would have otherwise been issued to
such former Company Stockholders. In lieu of any fractional shares of Buyer
Common Stock that would have otherwise been issued, each former Company
Stockholder that would have been entitled to receive a fractional share of Buyer
Common Stock shall, upon proper surrender of such person's Certificates, receive
a cash payment equal to the last reported sale price per share of Buyer Common
Stock on the Nasdaq National Market, as reported by Nasdaq, on the trading day
immediately prior to the Closing Date, multiplied by the fraction of a share of
Buyer Common Stock that such Company Stockholder would otherwise be entitled to
receive.
1.9 OPTIONS.
(a) As of the Effective Time, the Buyer shall assume (i) the Company's
1997 Equity Incentive Plan, as amended (the "Option Plan"), and (ii) all
options to purchase Company Shares issued by the Company pursuant to the
Option Plan or otherwise ("Options"), whether vested or unvested.
Immediately after the Effective Time, each Option outstanding immediately
prior to the Effective Time shall be deemed to constitute an option to
acquire, on the same terms and conditions as were applicable under such
Option at the Effective Time, such number of shares of Buyer Common Stock as
is equal to the number of Common Shares subject to the unexercised portion
of such Option multiplied by the Conversion Ratio (with any fraction
resulting from such multiplication to be rounded down to the nearest whole
number). The exercise price per share of each such assumed Option shall be
equal to the exercise price of such Option immediately prior to the
Effective Time, divided by the Conversion Ratio (rounded up to the nearest
whole cent). The term, exercisability, vesting schedule, status as an
"incentive stock option" under Section 422 of the Internal Revenue Code of
1986 (as amended, the "Code"), if applicable, and all of the other terms of
the Options shall otherwise remain unchanged.
(b) As soon as practicable after the Effective Time, the Buyer shall
deliver to the holders of Options appropriate notices setting forth such
holders' rights pursuant to such Options, as amended as set forth in this
Section 1.9 by the Board of Directors of the Company in accordance with the
terms of the Option Plan, and the agreements evidencing such Options shall
continue in effect on the same terms and conditions (subject to the
amendments described in this Section 1.9 and such notice).
(c) The Buyer shall take all corporate action necessary to reserve for
issuance a sufficient number of shares of Buyer Common Stock for delivery
upon exercise of the Options assumed in accordance with this Section 1.9. As
soon as practicable after the Effective Time, the Buyer shall file a
Registration Statement on Form S-8 (or any successor form) under the
Securities Act of 1933 (as amended, the "Securities Act") with respect to
all shares of Buyer Common Stock subject to such Options that may be
registered on a Form S-8, and shall use its best efforts to maintain the
effectiveness of such Registration Statement for so long as such Options
remain outstanding.
1.10 WARRANT. As of the Effective Time, the Buyer shall assume that
warrant to purchase Company Shares dated January 26, 1999 and issued to the Mayo
Foundation for Medical Education and Research (the "Warrant"). Immediately after
the Effective Time, the Warrant shall be deemed to constitute a warrant to
acquire, on the same terms and conditions as were applicable under the Warrant
at the Effective Time, such number of shares of Buyer Common Stock as is equal
to the number of Common Shares subject to the unexercised portion of the Warrant
multiplied by the Conversion Ratio (with any fraction resulting from such
multiplication to be rounded down to the nearest whole number). The purchase
price per share of the assumed Warrant shall be equal to the
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purchase price of the Warrant immediately prior to the Effective Time, divided
by the Conversion Ratio (rounded up to the nearest whole cent). The term,
exercisability and all of the other terms of the Warrant shall otherwise remain
unchanged.
As soon as practicable after the Effective Time, the Buyer shall deliver to
the holder of the Warrant a certificate setting forth the adjustments to the
number of shares subject to the Warrant and to the purchase price therefor and a
brief statement of the facts requiring such adjustment, all as provided in
Section 2(c) of the Warrant.
1.11 CERTIFICATE OF INCORPORATION. Article First of the Certificate of
Incorporation of the Acquisition Subsidiary shall be amended as of the Effective
Time so a to read in its entirety: "The name of the Corporation is Millennium
Predictive Medicine, Inc." and, as so amended, such Certificate of Incorporation
shall be the Certificate of Incorporation of the Surviving Corporation.
1.12 BYLAWS. The By-laws of the Surviving Corporation shall be the same as
the By-laws of the Acquisition Subsidiary immediately prior to the Effective
Time, except that the name of the corporation set forth therein shall be changed
to Millennium Predictive Medicine, Inc.
1.13 DIRECTORS AND OFFICERS. The directors and officers of the Acquisition
Subsidiary shall become the directors and officers of the Surviving Corporation
as of the Effective Time.
1.14 NO FURTHER RIGHTS. From and after the Effective Time, no Company
Shares shall be deemed to be outstanding, and holders of Certificates shall
cease to have any rights with respect thereto, except as provided herein or by
law.
1.15 CLOSING OF TRANSFER BOOKS. At the Effective Time, the stock transfer
books of the Company shall be closed and no transfer of Company Shares shall
thereafter be made. If, after the Effective Time, Certificates are presented to
the Buyer or the Exchange Agent, they shall be cancelled and exchanged for Buyer
Common Stock in accordance with Section 1.5, subject to applicable law in the
case of Dissenting Shares.
1.16 CONSENT TO ASSIGNMENT. The Buyer hereby consents to the assignment,
at the Effective Time by the Company to the Acquisition Subsidiary of each and
every contract between the Company and the Buyer, including without limitation
the Administrative Services Agreement, the Trademark License Agreement, the
Technology Transfer and License Agreement, Research Services and Collaboration
Agreement, Tax Sharing Agreement and the Amended and Restated Rights Exchange
Agreement, each dated as of February 1, 1999.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to the Buyer as follows:
2.1 ORGANIZATION, QUALIFICATION AND CORPORATE POWER. The Company is a
corporation duly organized, validly existing and in corporate and tax good
standing under the laws of the State of Delaware. The Company is duly qualified
to conduct business and is in corporate and tax good standing under the laws of
each jurisdiction in which the nature of its businesses or the ownership or
leasing of its properties requires such qualification, except where the failure
to be so qualified or in good standing, individually or in the aggregate, has
not had and would not reasonably be expected to have a Company Material Adverse
Effect (as defined below). The Company has all requisite corporate power and
authority to carry on the businesses in which it is engaged and to own and use
the properties owned and used by it. The Company has furnished to the Buyer
complete and accurate copies of its Certificate of Incorporation and By-laws.
The Company is not in default under or in violation of any provision of its
Certificate of Incorporation or By-laws. For purposes of this
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Agreement, "Company Material Adverse Effect" means a material adverse effect on
the assets, business, condition (financial or otherwise) or results of
operations of the Company.
2.2 CAPITALIZATION. The authorized capital stock of the Company consists
of 27,999,800 shares of Company Shares, 14,000,000 of which are designated as
Class A Common Stock, 2,300,000 of which are designated as Class B Common Stock
and 11,699,800 of which are designated as Preferred Stock. Of the shares of
Preferred Stock, 8,750,000 have been designated as Series A Convertible
Preferred Stock, 750,000 have been designated as Series B Convertible Preferred
Stock, 1,200,000 have been designated as Series C Convertible Preferred Stock,
590,000 have been designated as Series D Convertible Preferred Stock and 409,800
have not been designated. As of the date hereof, 200 shares of Class A Common
Stock, 1,600,931 shares of Class B Common Stock, 8,750,000 shares of Series A
Convertible Preferred Stock, 750,000 shares of Series B Convertible Preferred
Stock, 1,200,000 shares of Series C Convertible Preferred Stock and no shares of
Series D Convertible Preferred Stock are issued and outstanding and none of such
shares are held in the treasury of the Company. All issued and outstanding
shares of the Company's capital stock have been duly authorized and validly
issued, are fully paid and nonassessable and were issued in compliance with
applicable federal and state securities laws. Except for the conversion
privileges of the Series A Convertible Preferred Stock, the Series B Convertible
Preferred Stock and the Series C Convertible Preferred Stock and except for the
Options and the Warrant, there are no other outstanding shares of capital stock
or outstanding rights of first refusal, preemptive rights or other rights,
options, warrants, conversion rights or other agreements, either directly or
indirectly, for the purchase or acquisition from the Company of any shares of
its capital stock.
2.3 AUTHORIZATION OF TRANSACTION. The Company has all requisite power and
authority to execute and deliver this Agreement and to perform its obligations
hereunder. The execution and delivery by the Company of this Agreement and,
subject to the adoption of this Agreement and the approval of the Merger by a
majority of the votes represented by the Company Shares outstanding and entitled
to vote on this Agreement and the Merger (the "Requisite Stockholder Approval"),
the consummation by the Company of the transactions contemplated hereby have
been duly and validly authorized by all necessary corporate action on the part
of the Company. Without limiting the generality of the foregoing, the Board of
Directors of the Company and the special committee thereof formed to consider
the Merger (the "Special Committee") have each (i) determined that the Merger is
fair to and in the best interests of the Company's stockholders other than the
Buyer, (ii) approved this Agreement and authorized its the execution and
delivery and (iii) directed that this Agreement and the Merger be submitted to
the stockholders of the Company entitled to vote thereon for their adoption and
approval and resolved to recommend that the stockholders of the Company vote in
favor of the adoption of this Agreement and the approval of the Merger. This
Agreement has been duly and validly executed and delivered by the Company and
constitutes a valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms.
2.4 NONCONTRAVENTION. Subject to the filing of a Certificate of Merger as
required by the Delaware General Corporation Law, neither the execution and
delivery by the Company of this Agreement, nor the consummation by the Company
of the transactions contemplated hereby, will (a) conflict with or violate any
provision of the Certificate of Incorporation or By-laws of the Company,
(b) require on the part of the Company any filing with, or any permit,
authorization, consent or approval of, any court, arbitrational tribunal,
administrative agency or commission or other governmental or regulatory
authority or agency (a "Governmental Entity"), (c) conflict with, result in a
breach of, constitute (with or without due notice or lapse of time or both) a
default under, result in the acceleration of obligations under, create in any
party the right to terminate, modify or cancel, or require any notice, consent
or waiver under, any contract or instrument to which the Company is a party or
by which the Company is bound or to which any of its assets is subject, except
for (i) any conflict, breach, default, acceleration, termination, modification
or cancellation which would not have a
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Company Material Adverse Effect and would not adversely affect the consummation
of the transactions contemplated hereby or (ii) any notice, consent or waiver
the absence of which would not have a Company Material Adverse Effect and would
not adversely affect the consummation of the transactions contemplated hereby,
(d) result in the imposition of any Security Interest (as defined below) upon
any assets of the Company or (e) violate any order, writ, injunction, decree,
statute, rule or regulation applicable to the Company or any of its properties
or assets. For purposes of this Agreement: "Security Interest" means any
mortgage, pledge, security interest, encumbrance, charge or other lien (whether
arising by contract or by operation of law), other than (i) mechanic's,
materialmen's, and similar liens, (ii) liens arising under worker's
compensation, unemployment insurance, social security, retirement, and similar
legislation, and (iii) liens on goods in transit incurred pursuant to
documentary letters of credit, in each case arising in the Ordinary Course of
Business (as defined below) of the Company and not material to the Company; and
"Ordinary Course of Business" means the ordinary course of the Company's
business, consistent with past custom and practice (including with respect to
frequency and amount).
2.5 OPINION OF FINANCIAL ADVISOR. The Special Committee has received an
opinion from Deutsche Bank Securities Inc., dated March 1, 2000, a signed copy
of which will be provided to the Buyer concurrently with the execution and
delivery of this Agreement, with respect to the fairness, from a financial point
of view, of the Conversion Ratio to the holders of Company Common Stock (other
than the Buyer).
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE BUYER
The Buyer represents and warrants to the Company as follows:
3.1 ORGANIZATION, QUALIFICATION AND CORPORATE POWER. Each of the Buyer and
the Acquisition Subsidiary is a corporation duly organized, validly existing and
in good standing under the laws of the state of its incorporation. The Buyer is
duly qualified to conduct business and is in corporate and tax good standing
under the laws of each jurisdiction in which the nature of its businesses or the
ownership or leasing of its properties requires such qualification, except where
the failure to be so qualified or in good standing would not have a Buyer
Material Adverse Effect (as defined below). The Buyer has all requisite
corporate power and authority to carry on the businesses in which it is engaged
and to own and use the properties owned and used by it. For purposes of this
Agreement, "Buyer Material Adverse Effect" means a material adverse effect on
the assets, business, condition (financial or otherwise) or results of
operations of the Buyer and its subsidiaries, taken as a whole.
3.2 CAPITALIZATION. The authorized capital stock of the Buyer, as of the
date hereof, consists of (i) 100,000,000 shares of Buyer Common Stock, of which
45,379,989 shares are issued and outstanding and none are held in the treasury
of the Buyer and (ii) 5,000,000 shares of authorized blank check preferred
stock, $.001 par value per share, none of which have been designated, are issued
and outstanding or are held in the treasury of the Buyer. All of the issued and
outstanding shares of Buyer Common Stock are duly authorized, validly issued,
fully paid, nonassessable and free of all preemptive rights. All of the shares
of Buyer Common Stock will be, when issued in accordance with this Agreement,
duly authorized, validly issued, fully paid, nonassessable and free of all
preemptive rights.
3.3 AUTHORIZATION OF TRANSACTION. Each of the Buyer and the Acquisition
Subsidiary has all requisite power and authority to execute and deliver this
Agreement and to perform its obligations hereunder. The execution and delivery
by the Buyer and the Acquisition Subsidiary of this Agreement and the
consummation by the Buyer and the Acquisition Subsidiary of the transactions
contemplated hereby have been duly and validly authorized by all necessary
corporate action on the part of the Buyer and the Acquisition Subsidiary. This
Agreement has been duly and validly executed and delivered by
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the Buyer and the Acquisition Subsidiary and constitutes a valid and binding
obligation of the Buyer and the Acquisition Subsidiary, enforceable against them
in accordance with its terms.
3.4 NONCONTRAVENTION. Subject to compliance with the applicable
requirements of the Securities Act and any applicable state securities laws, the
Securities Exchange Act of 1934 (as amended, the "Exchange Act") and the filing
of the Certificate of Merger as required by the Delaware General Corporation
Law, neither the execution and delivery by the Buyer or the Acquisition
Subsidiary of this Agreement, nor the consummation by the Buyer or the
Acquisition Subsidiary of the transactions contemplated hereby, will
(a) conflict with or violate any provision of the charter or By-laws of the
Buyer or the Acquisition Subsidiary, (b) require on the part of the Buyer or the
Acquisition Subsidiary any filing with, or permit, authorization, consent or
approval of, any Governmental Entity, (c) conflict with, result in breach of,
constitute (with or without due notice or lapse of time or both) a default
under, result in the acceleration of obligations under, create in any party any
right to terminate, modify or cancel, or require any notice, consent or waiver
under, any contract or instrument to which the Buyer or the Acquisition
Subsidiary is a party or by which it is bound or to which any of its assets are
subject, except for (i) any conflict, breach, default, acceleration,
termination, modification or cancellation which would not adversely affect the
consummation of the transactions contemplated hereby or (ii) any notice, consent
or waiver the absence of which would not adversely affect the consummation of
the transactions contemplated hereby, or (d) violate any order, writ,
injunction, decree, statute, rule or regulation applicable to the Buyer or the
Acquisition Subsidiary or any of their properties or assets.
3.5 REPORTS AND FINANCIAL STATEMENTS. The Buyer has previously furnished
or made available to the Company complete and accurate copies, as amended or
supplemented, of its (a) Annual Report on Form 10-K for the fiscal year ended
December 31, 1999, as filed with the Securities and Exchange Commission (the
"SEC"), and (b) all other reports filed with the SEC by the Buyer under
Section 13 or subsections (a) or (c) of Section 14 of the Exchange Act since
December 31, 1999 (such reports are collectively referred to herein as the
"Buyer Reports"). The Buyer Reports constitute all of the documents required to
be filed with the SEC by the Buyer under Section 13 or subsections (a) or
(c) of Section 14 of the Exchange Act from January 1, 1999 through the date of
this Agreement. The Buyer Reports complied in all material respects with the
requirements of the Exchange Act and the rules and regulations thereunder when
filed. As of their respective dates, the Buyer Reports did not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. The audited financial
statements and unaudited interim financial statements of the Buyer included in
the Buyer Reports (i) complied as to form in all material respects with
applicable accounting requirements and the published rules and regulations of
the SEC with respect thereto when filed, (ii) were prepared in accordance with
United States generally accepted accounting principles applied on a consistent
basis throughout the periods covered thereby (except as may be indicated therein
or in the notes thereto, and in the case of quarterly financial statements, as
permitted by Form 10-Q under the Exchange Act), (iii) fairly present the
consolidated financial condition, results of operations and cash flows of the
Buyer as of the respective dates thereof and for the periods referred to
therein, and (iv) are consistent with the books and records of the Buyer.
3.6 ABSENCE OF MATERIAL ADVERSE CHANGES. Since September 30, 1999, there
has occurred no event or development which has had a Buyer Material Adverse
Effect.
3.7 LITIGATION. The Buyer is not a party to or, to the knowledge of the
Buyer, threatened to be made a party to (a) any unsatisfied judgment, order,
decree, stipulation or injunction or (b) any claim, complaint, action, suit,
proceeding, hearing or investigation of or before any Governmental Entity or
before any arbitrator that, in the case of either (a) or (b), reasonably could
be expected to have a Buyer Material Adverse Effect.
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ARTICLE IV
COVENANTS
4.1 CLOSING EFFORTS. Each of the Parties shall use its best efforts, to
the extent commercially reasonable ("Reasonable Best Efforts"), to take all
actions and to do all things necessary, proper or advisable to consummate the
transactions contemplated by this Agreement, including without limitation using
its Reasonable Best Efforts to ensure that (i) its representations and
warranties remain true and correct in all material respects through the Closing
Date and (ii) the conditions to the obligations of the other Parties to
consummate the Merger are satisfied.
4.2 PROSPECTUS/INFORMATION STATEMENT AND REGISTRATION STATEMENT. The Buyer
shall prepare, with the assistance and cooperation of the Company, a
Registration Statement on Form S-4 as promptly as practicable after the date
hereof (the "Registration Statement"). The Registration Statement shall include
a prospectus/information statement to be used for the purpose of offering the
Buyer Common Stock to stockholders of the Company (such prospectus/information
statement, together with any accompanying letter to stockholders, shall be
referred to herein as the "Prospectus/Information Statement"). The Buyer shall
file the Registration Statement with the SEC and shall, with the assistance of
the Company, promptly respond to any SEC comments on the Registration Statement
and shall otherwise use its Reasonable Best Efforts to have the Registration
Statement declared effective under the Securities Act as promptly as
practicable. Promptly following such time as the Registration Statement is
declared effective, the Company shall distribute the Prospectus/Information
Statement to its stockholders.
4.3 OPERATION OF BUSINESS. Except as contemplated by this Agreement,
during the period from the date of this Agreement to the Effective Time, the
Company shall conduct its operations in the Ordinary Course of Business and in
compliance with all applicable laws and regulations and, to the extent
consistent therewith, use its Reasonable Best Efforts to preserve intact its
current business organization, keep its physical assets in good working
condition, keep available the services of its current officers and employees and
preserve its relationships with customers, suppliers and others having business
dealings with it to the end that its goodwill and ongoing business shall not be
impaired in any material respect.
4.4 LISTING OF BUYER COMMON STOCK. The Buyer shall list the Buyer Common
Stock to be issued in the Merger on the Nasdaq National Market.
4.5 INDEMNIFICATION.
(a) From and after the Effective Time, Buyer agrees that it will
indemnify and hold harmless each present and former director and officer of
the Company (the "Indemnified Parties"), against any costs or expenses
(including attorneys' fees), judgments, fines, losses, claims, damages,
liabilities or amounts paid in settlement incurred in connection with any
claim, action, suit, proceeding or investigation, whether civil, criminal,
administrative or investigative, arising out of or pertaining to matters
existing or occurring at or prior to the Effective Time, whether asserted or
claimed prior to, at or after the Effective Time, to the fullest extent that
the Company would have been permitted under Delaware law and its Certificate
of Incorporation or Bylaws in effect on the date hereof to indemnify an
Indemnified Party (and Buyer shall also advance expenses as incurred to the
fullest extent permitted under applicable law, provided the Indemnified
Party to whom expenses are advanced provides an undertaking to repay such
advances if it is ultimately determined that such Indemnified Party is not
entitled to indemnification).
(b) For a period of three years after the Effective Time, Buyer shall
cause the Company to maintain (to the extent available in the market) in
effect a directors' and officers' liability insurance policy covering those
persons who are currently covered by the Company's directors' and officers'
liability insurance policy (a copy of which has been heretofore delivered to
Buyer) with
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coverage in amount and scope at least as favorable to such persons as the
Company's existing coverage; provided, that in no event shall Buyer be
required to expend in excess of 150% of the annual premium currently paid by
the Company for such coverage.
(c) The provisions of this Section 4.5 are intended to be in addition to
the rights otherwise available to the current officers and directors of the
Company by law, charter, statute, bylaw or agreement, and shall operate for
the benefit of, and shall be enforceable by, each of the Indemnified
Parties, their heirs and their representatives.
4.6 AGREEMENTS FROM CERTAIN AFFILIATES OF THE COMPANY. Attached hereto as
Exhibit A is a list of those persons who are, in the Company's reasonable
judgment, Affiliates of the Company. The Company shall provide the Buyer such
information and documents as the Buyer shall reasonably request for purposes of
reviewing such list and shall notify the Buyer in writing regarding any change
in the identity of its Affiliates prior to the Closing Date. In order to help
ensure that the issuance of and any resale of the Buyer Common Stock will comply
with the Securities Act and that the Merger will be treated as a tax-free
reorganization, the Company shall use its Reasonable Best Efforts to deliver or
cause to be delivered to the Buyer, as soon as practicable and in any case prior
to the mailing of the Prospectus/Information Statement (or, in the case of any
person who becomes an Affiliate after such date, as soon as practicable after
such person becomes an Affiliate), an Affiliate Agreement, in the form attached
hereto as Exhibit B (an "Affiliate Agreement"), executed by each of its
Affiliates. The Buyer shall be entitled to place appropriate legends on the
certificates evidencing any shares of Buyer Common Stock to be issued to
Affiliates of the Company, and to issue appropriate stop transfer instructions
to the transfer agent for the Buyer Common Stock, setting forth restrictions on
transfer consistent with the terms of the Affiliate Agreement.
4.7 AMENDMENT TO COLLABORATION AGREEMENT. Promptly following the Effective
Time, the Company shall amend the Collaboration and License Agreement dated
February 21, 1999 between Becton, Dickinson and Company ("Becton") and the
Company to eliminate Section 4.4 thereof and all references to the "Loan Option"
and "Convertible Note" (each as defined therein).
ARTICLE V
CONDITIONS TO CONSUMMATION OF MERGER
5.1 CONDITIONS TO EACH PARTY'S OBLIGATIONS. The respective obligations of
each Party to consummate the Merger are subject to the satisfaction of the
following conditions:
(a) the holders of a majority of the Company Shares entitled to vote
thereon shall have voted in favor of the adoption of this Agreement and
approval of the Merger;
(b) the Buyer and the Company shall have received an opinion from Hale
and Dorr LLP, in a form customarily provided for transactions similar to the
Merger and reasonably satisfactory to the Buyer and the Company, dated the
Closing Date, to the effect that the Merger will constitute a reorganization
for federal income tax purposes within the meaning of Section 368(a) of the
Code;
(c) the Registration Statement shall have been declared effective by the
SEC and shall not be the subject of any stop order or proceedings seeking a
stop order;
(d) no Governmental Entity of competent jurisdiction shall have enacted,
issued, promulgated, enforced or entered any order, executive order, stay,
decree, judgment, injunction, statute, rule or regulation which shall be in
effect and which shall have the effect of making the Merger illegal or
otherwise prohibiting consummation of the Merger; and
(e) (i) all waivers, permits, consents, approvals or other
authorizations in connection with the consummation of the transactions
contemplated by this Agreement shall have been obtained from the appropriate
Governmental Entities, and (ii) all registrations, filings and notices in
connection
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with the transactions contemplated by this Agreement shall have been
effected with the appropriate Governmental Entities, except those whose
failure to obtain or effect would have neither a Buyer Material Adverse
Effect nor a Company Material Adverse Effect.
5.2 CONDITIONS TO OBLIGATIONS OF THE BUYER AND THE ACQUISITION
SUBSIDIARY. The obligations of the Buyer and the Acquisition Subsidiary to
consummate the Merger are subject to the satisfaction (or waiver by the Buyer)
of the following additional conditions:
(a) the representations and warranties of the Company set forth in the
first sentence of Section 2.1 and in Sections 2.2 and 2.3 and any
representations and warranties of the Company set forth in this Agreement
that are qualified as to materiality or as to Company Material Adverse
Effect shall be true and correct in all respects, and all other
representations and warranties of the Company set forth in this Agreement
shall be true and correct in all material respects, in each case as of the
date of this Agreement and as of the Effective Time as though made as of the
Effective Time, except to the extent such representations and warranties are
specifically made as of a particular date or as of the date of this
Agreement (in which case such representations and warranties shall be true
and correct as of such date);
(b) the Company shall have performed or complied with in all material
respects its agreements and covenants required to be performed or complied
with under this Agreement as of or prior to the Effective Time; and
(c) the Company shall have obtained any consent or approval of any third
party the failure of which to obtain, individually or in the aggregate, is
reasonably likely to have a Company Material Adverse Effect.
5.3 CONDITIONS TO OBLIGATIONS OF THE COMPANY. The obligation of the
Company to consummate the Merger is subject to the satisfaction of the following
additional conditions:
(a) the Buyer Common Stock to be issued in the Merger shall have been
authorized for listing on the Nasdaq National Market upon official notice of
issuance;
(b) the representations and warranties of the Buyer and the Acquisition
Subsidiary set forth in the first sentence of Section 3.1 and in
Section 3.3 and any representations and warranties of the Buyer or the
Acquisition Subsidiary set forth in this Agreement that are qualified as to
materiality or as to Buyer Material Adverse Effect shall be true and
correct, and all other representations and warranties of the Buyer and the
Acquisition Subsidiary set forth in this Agreement shall be true and correct
in all material respects, in each case as of the date of this Agreement and
as of the Effective Time as though made as of the Effective Time, except to
the extent such representations and warranties are specifically made as of a
particular date or as of the date of this Agreement (in which case such
representations and warranties shall be true and correct as of such date);
and
(c) the Buyer and the Acquisition Subsidiary shall have performed or
complied with in all material respects their agreements and covenants
required to be performed or complied with under this Agreement as of or
prior to the Effective Time.
ARTICLE VI
TERMINATION
6.1 TERMINATION OF AGREEMENT. The Parties may terminate this Agreement
prior to the Effective Time (whether before or after Requisite Stockholder
Approval), as provided below:
(a) the Parties may terminate this Agreement by mutual written consent;
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(b) the Buyer may terminate this Agreement by giving written notice to
the Company in the event the Company is in breach of any representation,
warranty or covenant contained in this Agreement, and such breach,
individually or in combination with any other such breach, (i) would cause
the conditions set forth in clauses (a) or (b) of Section 5.2 not to be
satisfied and (ii) is not cured within 20 days following delivery by the
Buyer to the Company of written notice of such breach;
(c) the Company may terminate this Agreement by giving written notice to
the Buyer in the event the Buyer is in breach of any representation,
warranty or covenant contained in this Agreement, and such breach,
individually or in combination with any other such breach, (i) would cause
the conditions set forth in clauses (b) or (c) of Section 5.3 not to be
satisfied and (ii) is not cured within 20 days following delivery by the
Company to the Buyer of written notice of such breach; or
(d) either the Buyer or the Company may terminate this Agreement if the
Merger shall not have been consummated on or before December 31, 2000;
provided, however, that a Party may not terminate pursuant to this
clause (d) if the terminating Party (or, in the case of the Buyer, the
Acquisition Subsidiary) shall have breached in any material respect its
representations and warranties or its obligations under this Agreement in
any manner that shall have proximately contributed to the occurrence of the
failure referred to in this clause (d).
6.2 EFFECT OF TERMINATION. If any Party terminates this Agreement pursuant
to Section 6.1, all obligations of the Parties hereunder shall terminate without
any liability of any Party to any other Party (except for any liability of any
Party for breaches of this Agreement).
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ARTICLE VII
DEFINITIONS
For purposes of this Agreement, each of the following defined terms is
defined in the Section of this Agreement indicated below.
<TABLE>
<CAPTION>
DEFINED TERM SECTION
- ------------ ------------
<S> <C>
Acquisition Subsidiary...................................... Introduction
Affiliate Agreement......................................... 4.6
Buyer....................................................... Introduction
Buyer Common Stock.......................................... 1.5(a)
Buyer Material Adverse Effect............................... 3.1
Buyer Reports............................................... 3.5
Certificates................................................ 1.7(a)
Certificate of Merger....................................... 1.1
Closing..................................................... 1.2
Closing Date................................................ 1.2
Code........................................................ 1.9(a)
Company..................................................... Introduction
Company Material Adverse Effect............................. 2.1
Company Shares.............................................. 1.5(a)
Company Stockholder......................................... 1.5(c)
Conversion Ratio............................................ 1.5(a)
Dissenting Shares........................................... 1.6(a)
Effective Time.............................................. 1.1
Exchange Act................................................ 3.4
Exchange Agent.............................................. 1.3
Governmental Entity......................................... 2.4
Indemnified Parties......................................... 4.5
Merger...................................................... 1.1
Option Plan................................................. 1.9(a)
Options..................................................... 1.9(a)
Ordinary Course of Business................................. 2.4
Parties..................................................... Introduction
Prospectus/Information Statement............................ 4.2
Reasonable Best Efforts..................................... 4.1
Registration Statement...................................... 4.2
Requisite Stockholder Approval.............................. 6.1
SEC......................................................... 3.5
Securities Act.............................................. 1.9(c)
Security Interest........................................... 2.4
Special Committee........................................... 2.3
Surviving Corporation....................................... 1.1
</TABLE>
ARTICLE VIII
MISCELLANEOUS
8.1 SURVIVAL. None of the representations, warranties, covenants or
agreements set forth herein shall survive the Closing; provided, however, that
the covenants set forth in Article I and Sections 4.5 and 4.7 shall survive the
Closing.
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8.2 NO THIRD PARTY BENEFICIARIES. This Agreement shall not confer any
rights or remedies upon any person other than the Parties and their respective
successors and permitted assigns; provided, however, that the provisions in
Article I concerning issuance of the Buyer Common Stock are intended for the
benefit of the Company Stockholders, the provisions of Section 4.5 are intended
for the benefit of the officers and directors of the Company and the provisions
of Section 4.7 are intended for the benefit of Becton.
8.3 ENTIRE AGREEMENT. This Agreement (including the documents referred to
herein) constitutes the entire agreement among the Parties and supersedes any
prior understandings, agreements or representations by or among the Parties,
written or oral, with respect to the subject matter hereof.
8.4 SUCCESSION AND ASSIGNMENT. This Agreement shall be binding upon and
inure to the benefit of the Parties named herein and their respective successors
and permitted assigns. No Party may assign either this Agreement or any of its
rights, interests or obligations hereunder without the prior written approval of
the other Parties.
8.5 COUNTERPARTS AND FACSIMILE SIGNATURE. This Agreement may be executed
in two or more counterparts, each of which shall be deemed an original but all
of which together shall constitute one and the same instrument. This Agreement
may be executed by facsimile signature.
8.6 HEADINGS. The section headings contained in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
8.7 NOTICES. All notices, requests, demands, claims, and other
communications hereunder shall be in writing. Any notice, request, demand, claim
or other communication hereunder shall be deemed duly delivered four business
days after it is sent by registered or certified mail, return receipt requested,
postage prepaid, or one business day after it is sent for next business day
delivery via a reputable nationwide overnight courier service, in each case to
the intended recipient as set forth below:
If to the Company:
Millennium Predictive Medicine, Inc.
640 Memorial Drive
Cambridge, MA 02139-4815
Attention: President
(with a copy to the General Counsel)
If to the Buyer or the Acquisition Subsidiary:
Millennium Pharmaceuticals, Inc.
75 Sidney Street
Cambridge, MA 02139
Attention: Chief Business Officer
(with a copy to the General Counsel)
Any Party may give any notice, request, demand, claim or other communication
hereunder using any other means (including personal delivery, expedited courier,
messenger service, telecopy, telex, ordinary mail or electronic mail), but no
such notice, request, demand, claim or other communication shall be deemed to
have been duly given unless and until it actually is received by the party for
whom it is intended. Any Party may change the address to which notices,
requests, demands, claims, and other communications hereunder are to be
delivered by giving the other Parties notice in the manner herein set forth.
8.8 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Delaware without giving effect
to any choice or conflict of law provision or
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<PAGE>
rule (whether of the State of Delaware or any other jurisdiction) that would
cause the application of laws of any jurisdictions other than those of the State
of Delaware.
8.9 AMENDMENTS AND WAIVERS. The Parties may mutually amend any provision
of this Agreement at any time prior to the Effective Time. No amendment of any
provision of this Agreement shall be valid unless the same shall be in writing
and signed by all of the Parties. No waiver of any right or remedy hereunder
shall be valid unless the same shall be in writing and signed by the Party
giving such waiver. No waiver by any Party with respect to any default,
misrepresentation or breach of warranty or covenant hereunder shall be deemed to
extend to any prior or subsequent default, misrepresentation or breach of
warranty or covenant hereunder or affect in any way any rights arising by virtue
of any prior or subsequent such occurrence. Any such amendment shall be agreed
to by the Company and any such waiver shall be granted by the Company only if
the Board of Directors of the Company, acting in accordance with a
recommendation of the Special Committee, has authorized such amendment or
waiver.
8.10 SEVERABILITY. Any term or provision of this Agreement that is invalid
or unenforceable in any situation in any jurisdiction shall not affect the
validity or enforceability of the remaining terms and provisions hereof or the
validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction. If the final judgment of a court of
competent jurisdiction declares that any term or provision hereof is invalid or
unenforceable, the Parties agree that the court making the determination of
invalidity or unenforceability shall have the power to limit the term or
provision, to delete specific words or phrases, or to replace any invalid or
unenforceable term or provision with a term or provision that is valid and
enforceable and that comes closest to expressing the intention of the invalid or
unenforceable term or provision, and this Agreement shall be enforceable as so
modified.
8.11 SUBMISSION TO JURISDICTION. Each of the Parties (a) submits to the
jurisdiction of any state or federal court sitting in Delaware in any action or
proceeding arising out of or relating to this Agreement, (b) agrees that all
claims in respect of such action or proceeding may be heard and determined in
any such court, and (c) agrees not to bring any action or proceeding arising out
of or relating to this Agreement in any other court. Each of the Parties waives
any defense of inconvenient forum to the maintenance of any action or proceeding
so brought and waives any bond, surety or other security that might be required
of any other Party with respect thereto. Any Party may make service on another
Party by sending or delivering a copy of the process to the Party to be served
at the address and in the manner provided for the giving of notices in
Section 8.7. Nothing in this Section 8.11, however, shall affect the right of
any Party to serve legal process in any other manner permitted by law.
8.12 WAIVER OF RIGHT TO TRIAL BY JURY. Each Party to this Agreement hereby
expressly waives any right to trial by jury of any claim, demand, action or
cause of action arising under this Agreement, whether sounding in contract or
tort or otherwise; and each Party hereby agrees and consents that any such
claim, demand, action or cause of action shall be decided by court trial without
a jury and that any Party to this Agreement may file a copy of this
Section 8.12 with any court as written evidence of the consent to the Parties
hereto to the waiver of their right to trial by jury.
8.13 CONSTRUCTION.
(a) The language used in this Agreement shall be deemed to be the
language chosen by the Parties to express their mutual intent, and no rule
of strict construction shall be applied against any Party.
(b) Any reference to any federal, state, local or foreign statute or law
shall be deemed also to refer to all rules and regulations promulgated
thereunder, unless the context requires otherwise.
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<PAGE>
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
first above written.
<TABLE>
<S> <C> <C>
MILLENNIUM PHARMACEUTICALS, INC.
By: /s/ MARK J. LEVIN
----------------------------------------
Title: Chief Executive Officer
----------------------------------------
MILLENNIUM PREDICTIVE MEDICINE, INC.
By: /s/ KENNETH J. CONWAY
----------------------------------------
Title: President
----------------------------------------
MPMX ACQUISITION CORP.
By: /s/ JOHN B. DOUGLAS III
----------------------------------------
Title: General Counsel
----------------------------------------
</TABLE>
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<PAGE>
EXHIBIT A
Kenneth J. Conway
Steven H. Holtzman
Michael Kauffman
Mark J. Levin
Marcia Radosevich
Laurence Reid
John Unger
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<PAGE>
EXHIBIT B
AFFILIATE AGREEMENT
, 2000
Millennium Pharmaceuticals, Inc.
75 Sidney Street
Cambridge, MA 02139-4815
Millennium Predictive Medicine, Inc.
640 Memorial Drive
Cambridge, MA 02139
Dear Sirs:
An Agreement and Plan of Merger dated as of March 1, 2000 (the "Merger
Agreement") has been entered into by and among Millennium Pharmaceuticals, Inc.
(the "Buyer"), MPMX Acquisition Corp. (the "Acquisition Subsidiary") and
Millennium Predictive Medicine, Inc. (the "Company"). The Merger Agreement
provides for the merger of the Company with and into the Acquisition Subsidiary
(the "Merger"). In accordance with the Merger Agreement, the shares of each
class of capital stock of the Company (collectively, the "Company Stock") owned
by the undersigned at the Effective Time (as defined in the Merger Agreement)
shall be converted into shares of common stock, $.001 par value per share, of
the Buyer (the "Buyer Common Stock"), as described in the Merger Agreement.
The undersigned may be deemed to be an "affiliate" of the Company within the
meaning of the rules promulgated under the Securities Act of 1933, as amended
(the "Securities Act"). In consideration of the mutual agreements set forth in
the Merger Agreement and hereinafter in this agreement, the undersigned
represents and agrees as follows:
(a) The undersigned will not offer, sell, transfer, pledge, hypothecate
or otherwise dispose of, or reduce the undersigned's interest in or risk
relating to, any shares of Buyer Common Stock issued to the undersigned in
the Merger unless at such time either: (i) such transaction shall be
permitted pursuant to the provisions of Rule 145 under the Securities Act;
(ii) the undersigned shall have furnished to the Buyer an opinion of
counsel, satisfactory to the Buyer, to the effect that no registration under
the Securities Act would be required in connection with the proposed offer,
sale, transfer, pledge, hypothecation or other disposition; or (iii) a
registration statement under the Securities Act covering the proposed offer,
sale, transfer, pledge, hypothecation or other disposition shall be
effective under the Securities Act.
(b) The undersigned understands that all certificates representing
shares of Buyer Common Stock delivered to the undersigned pursuant to the
Merger shall bear a legend substantially in the form set forth below, until
the earliest to occur of (i) one of the events referred to in paragraph (a)
above or (ii) the date on which the undersigned requests removal of such
legend, provided that such request occurs at least two years from the
Effective Time and that the undersigned is not at the time of such request,
and has not been during the three-month period immediately preceding such
request, an affiliate of the Buyer:
"The shares represented by this certificate were issued in a
transaction to which Rule 145 of the Securities Act of 1933 applies
and may only be transferred in accordance with the provisions of such
rule. In addition, the shares represented by this certificate may
only be transferred in accordance with the terms of an Affiliate
Agreement dated as of
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<PAGE>
, 2000 between the initial holder hereof and the
corporation, a copy of which agreement may be inspected by the holder
of this certificate at the principal offices of the corporation, or
furnished by the corporation to the holder of this certificate upon
written request without charge."
(c) The Buyer, in its discretion, may cause stop transfer orders to be
placed with its transfer agent with respect to the certificates for the
shares of Buyer Common Stock which are required to bear the foregoing
legend.
(d) The undersigned has, and as of the Effective Time will have, no plan
or intent (a "Plan"), and is not aware of any Plan on the part of other
Company Stockholders, to engage in a sale, transfer, pledge, hypothecation
or any other transaction that results in a direct or indirect transfer of
the risk of ownership: (i) to the Buyer, or any person related to the Buyer,
of (A) any Company Shares for consideration other than shares of Buyer
Common Stock (or any cash received in lieu of fractional shares of Buyer
Common Stock), or (B) any shares of Buyer Common Stock to be received in the
Merger; or (ii) to the Company, or any person related to the Company, of any
Company Shares. For purposes of this clause (d), the determination of
whether a person is related to the Buyer and/or the Company shall be made in
accordance with Treasury Regulation Section 1.368-1(e)(3). If any of the
undersigned's representations in this clause (d), cease to be true at any
time prior to the Effective Time, then the undersigned will deliver to each
of the Buyer and the Company, prior to the Effective Time, a written
statement to that effect, signed by the undersigned.
IX MISCELLANEOUS.
This agreement shall be governed by and construed in accordance with the
laws of the State of Delaware.
This agreement shall be binding on the undersigned's successors and assigns,
including his heirs, executors and administrators.
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<PAGE>
The undersigned has carefully read this agreement and discussed its
requirements, to the extent the undersigned believed necessary, with its counsel
or counsel for the Company.
<TABLE>
<S> <C> <C>
Very truly yours,
--------------------------------------
Signature
--------------------------------------
Print Name
Accepted:
MILLENNIUM PHARMACEUTICALS, INC.
- -------------------------------------------
(signature)
- -------------------------------------------
(print name and title)
- -------------------------------------------
(date)
MILLENNIUM PREDICTIVE MEDICINE, INC.
- -------------------------------------------
(signature)
- -------------------------------------------
(print name and title)
- -------------------------------------------
(date)
</TABLE>
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<PAGE>
Deutsche Banc Alex. Brown's opinion was rendered prior to the two-for-one
stock split of Millennium Pharmaceuticals common stock which was effected on
April 18, 2000 and, therefore, the conversion ratio referenced in its opinion
attached to this information statement/prospectus as Appendix B is not
reflective of the stock split.
<PAGE>
APPENDIX B
[LETTERHEAD OF DEUTSCHE BANK SECURITIES INC.]
March 1, 2000
The Special Committee of the Board Directors
Millennium Predictive Medicine, Inc.
640 Memorial Drive
Cambridge, Massachusetts 02139
Members of the Special Committee:
Deutsche Bank Securities Inc. ("Deutsche Bank") has been requested by the
Special Committee of the Board of Directors of Millennium Predictive
Medicine, Inc. ("MPM") to render an opinion, as more fully described below, in
connection with the proposed transaction involving MPM and Millennium
Pharmaceuticals, Inc. ("MP") pursuant to an Agreement and Plan of Merger, dated
as of March 1, 2000 (the "Agreement"), by and among MP, MPMX Acquisition Corp.,
a wholly owned subsidiary of MP (the "Subsidiary"), and MPM, which provides,
among other things, for the merger of MPM with and into Subsidiary (the
"Merger"). As set forth more fully in the Agreement, as a result of the Merger,
each outstanding share of the Class A common stock, par value $0.001 per share,
of MPM (the "MPM Class A Common Stock") and Class B common stock, par value
$0.001 per share, of MPM (the "MPM Class B Common Stock") and each outstanding
series of the preferred stock, par value $0.001 per share, of MPM will be
converted into the right to receive 0.2 (the "Conversion Ratio") of a share of
the common stock, par value $0.001 per share, of MP (the "MP Common Stock").
You have requested Deutsche Bank's opinion as to the fairness, from a
financial point of view, of the Conversion Ratio to the holders of MPM Common
Stock (other than MP).
In arriving at its opinion, Deutsche Bank has reviewed certain available
financial and other information concerning MPM, certain publicly available
financial and other information concerning MP and certain internal analyses and
other information furnished to or discussed with it by MPM, MP and their
respective advisors. Deutsche Bank also has held discussions with members of the
senior management of MPM and MP regarding the business and prospects of their
respective companies and the joint prospects of a combined company. In addition,
Deutsche Bank has (i) reviewed the reported prices and trading activity for MP
Common Stock, (ii) compared certain financial and stock market information for
MPM and MP with similar information for certain other companies whose securities
are publicly traded, (iii) reviewed the financial terms of certain recent
business combinations which it deemed comparable in whole or in part,
(iv) reviewed the terms of the Agreement, and (v) performed such other studies
and analyses and considered such other factors as it deemed appropriate.
Deutsche Bank has not assumed responsibility for independent verification
of, and has not independently verified, any information, whether publicly
available or furnished to it, concerning MPM, MP or the combined company,
including, without limitation, any financial information, forecasts or
projections considered in connection with the rendering of its opinion.
Accordingly, for purposes of its opinion, Deutsche Bank has assumed and relied
upon the accuracy and completeness of all such information and Deutsche Bank has
not conducted a physical inspection of any of the properties or assets, and has
not prepared or obtained any independent evaluation or appraisal of any of the
assets or liabilities, of MPM or MP. With respect to the financial forecasts and
projections made available to Deutsche Bank and used in its analyses, Deutsche
Bank has been advised and has assumed that they have been reasonably prepared on
bases reflecting the best currently available estimates and judgments of the
management of MPM and MP as to the matters covered thereby. Deutsche Bank's
opinion is necessarily based upon economic, market and other conditions as in
effect on, and the information made available to it as of, the date hereof.
B-1
<PAGE>
The Special Committee of the Board Directors
Millennium Predictive Medicine, Inc.
March 1, 2000
Page 2
For purposes of rendering its opinion, Deutsche Bank has assumed that, in
all respects material to its analysis, the representations and warranties of
MPM, MP and Subsidiary contained in the Agreement are true and correct, MPM, MP
and Subsidiary will each perform all of the covenants and agreements to be
performed by it under the Agreement and all conditions to the obligations of
each of MPM, MP and Subsidiary to consummate the Merger will be satisfied
without any waiver thereof. Deutsche Bank also has assumed that all material
governmental, regulatory or other approvals and consents required in connection
with the consummation of the Merger will be obtained and that in connection with
obtaining any necessary governmental, regulatory or other approvals and
consents, or any amendments, modifications or waivers to any agreements,
instruments or orders to which either MPM or MP is a party or is subject or by
which it is bound, no limitations, restrictions or conditions will be imposed or
amendments, modifications or waivers made that would have a material adverse
effect on MPM or MP or materially reduce the contemplated benefits of the Merger
to MPM, MP or the combined company. In addition. Deutsche Bank has been advised,
and accordingly for purposes of rendering its opinion also has assumed, that the
Merger is expected to qualify as a tax-free reorganization for federal income
tax purposes. In connection with its opinion, Deutsche Bank was not requested
to, and it did not, participate in the negotiation or structuring of the Merger,
nor was Deutsche Bank authorized to, and it did not, solicit interest from any
party with respect to the acquisition of all or a part of MPM. Deutsche Bank is
expressing no opinion as to the price at which the MP Common Stock will trade at
any time.
This opinion is addressed to, and for the use and benefit of, the Special
Committee of the Board of Directors of MPM and is not a recommendation to any
stockholder as to how such stockholder should vote with respect to matters
relating to the proposed Merger. This opinion is limited to the fairness, from a
financial point of view, of the Conversion Ratio to the holders of MPM Common
Stock (other than MP), and Deutsche Bank expresses no opinion as to the merits
of the underlying decision by MPM to engage in the Merger.
Deutsche Bank, as a customary part of its investment banking business, is
engaged in the valuation of businesses and their securities in connection with
mergers and acquisitions, negotiated underwritings, private placements and
valuations for estate, corporate and other purposes. Deutsche Bank will receive
a fee for its services with respect to this opinion, which fee will be payable
upon delivery of this opinion. Deutsche Bank maintains a market in securities,
and regularly publishes research reports regarding the businesses and
securities, of publicly traded companies in the life sciences industry. In the
ordinary course of business, Deutsche Bank and its affiliates may in the future
provide services to MP unrelated to the proposed Merger, for which services
Deutsche Bank and its affiliates would receive compensation, and Deutsche Bank
and its affiliates also may actively trade or hold the securities and other
instruments and obligations of MP for their own account and for the accounts of
customers and, accordingly, may at any time hold a long or short position in
such securities, instruments or obligations.
Based upon and subject to the foregoing, it is Deutsche Bank's opinion that,
as of the date of this letter, the Conversion Ratio is fair, from a financial
point of view, to the holders of MPM Common Stock (other than MP).
Very truly yours,
DEUTSCHE BANK SECURITIES INC.
B-2
<PAGE>
APPENDIX C
SECTION 262 OF THE DELAWARE GENERAL CORPORATION LAW
Section 262. Appraisal rights
(a) Any stockholder of a corporation of this State who holds shares of stock
on the date of the making of a demand pursuant to subsection (d) of this section
with respect to such shares, who continuously holds such shares through the
effective date of the merger or consolidation, who has otherwise complied with
subsection (d) of this section and who has neither voted in favor of the merger
or consolidation nor consented thereto in writing pursuant to Section 228 of
this title shall be entitled to an appraisal by the Court of Chancery of the
fair value of the stockholder's shares of stock under the circumstances
described in subsections (b) and (c) of this section. As used in this section,
the word "stockholder" means a holder of record of stock in a stock corporation
and also a member of record of a nonstock corporation; the words "stock" and
"share" mean and include what is ordinarily meant by those words and also
membership or membership interest of a member of a nonstock corporation; and the
words "depository receipt" mean a receipt or other instrument issued by a
depository representing an interest in one or more shares, or fractions thereof,
solely of stock of a corporation, which stock is deposited with the depository.
(b) Appraisal rights shall be available for the shares of any class or
series of stock of a constituent corporation in a merger or consolidation to be
effected pursuant to Section 251 (other than a merger effected pursuant to
Section 251(g) of this title), Section 252, Section 254, Section 257,
Section 258, Section 263 or Section 264 of this title:
(1) Provided, however, that no appraisal rights under this section shall
be available for the shares of any class or series of stock, which stock, or
depository receipts in respect thereof, at the record dated fixed to
determine the stockholders entitled to receive notice of and to vote at the
meeting of stockholders to act upon the agreement of merger or
consolidation, were either (i) listed on a national securities exchange or
designated as a national market system security on a interdealer quotation
system by the National Association of Securities Dealers, Inc. or (ii) held
of record by more than 2,000 holders; and further provided that no appraisal
rights shall be available for any shares of stock of the constituent
corporation surviving a merger if the merger did not require for its
approval the vote of the stockholders of the surviving corporation as
provided in subsection (f) of Section 251 of this title.
(2) Notwithstanding paragraph (1) of this subsection, appraisal rights
under this section shall be available for the shares of any class or series
of stock of a constituent corporation if the holders thereof are required by
the terms of an agreement of merger or consolidation pursuant to Sections
251, 252, 254, 257, 258, 263 and 264 of this title to accept for such stock
anything except:
a. Shares of stock of the corporation surviving or resulting from
such merger or consolidation, or depository receipts in respect thereof;
b. Shares of stock of any other corporation, or depository receipts
in respect thereof, which shares of stock (or depository receipts in
respect thereof) or depository receipts at the effective date of the
merger or consolidation will be either listed on a national securities
exchange or designated as a national market system security on an
interdealer quotation system by the National Association of Securities
Dealers, Inc. or held of record by more than 2,000 holders;
c. Cash in lieu of fractional shares or fractional depository
receipts described in the foregoing sub paragraphs a. and b. of this
paragraph; or
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d. Any combination of the shares of stock, depository receipts and
cash in lieu of fractional shares or fractional depository receipts
described in the foregoing subparagraphs a., b. and c. of this paragraph.
(3) In the event all of the stock of a subsidiary Delaware corporation
party to a merger effected under Section 253 of this title is not owned by
the parent corporation immediately prior to the merger, appraisal rights
shall be available for the shares of the subsidiary Delaware corporation.
(c) Any corporation may provide in its certificate of incorporation that
appraisal rights under this section shall be available for the shares of any
class or series of its stock as a result of an amendment to its certificate of
incorporation, any merger or consolidation in which the corporation is a
constituent corporation or the sale of all or substantially all of the assets of
the corporation. If the certificate of incorporation contains such a provision,
the procedures of this section, including those set forth in subsections
(d) and (e) of this section, shall apply as nearly as is practicable.
(d) Appraisal rights shall be perfected as follows:
(1) If a proposed merger or consolidation for which appraisal rights are
provided under this section is to be submitted for approval at a meeting of
stockholders, the corporation, not less than 20 days prior to the meeting,
shall notify each of its stockholders who was such on the record date for
such meeting with respect to shares for which appraisal rights are available
pursuant to subsection (b) or (c) hereof that appraisal rights are available
for any or all of the shares of the constituent corporations, and shall
include in such notice a copy of this section. Each stockholder electing to
demand the appraisal of such stockholder's shares shall deliver to the
corporation, before the taking of the vote on the merger or consolidation, a
written demand for appraisal of such stockholder's shares. Such demand will
be sufficient if it reasonably informs the corporation of the identity of
the stockholder and that the stockholder intends thereby to demand the
appraisal of such stockholder's shares. A proxy or vote against the merger
or consolidation shall not constitute such a demand. A stockholder electing
to take such action must do so by a separate written demand as herein
provided. Within 10 days after the effective date of such merger or
consolidation, the surviving or resulting corporation shall notify each
stockholder of each constituent corporation who has compiled with this
subsection and has not voted in favor of or consented to the merger or
consolidation of the date that the merger or consolidation has become
effective; or
(2) If the merger or consolidation was approved pursuant to Section 228
or Section 253 of this title, each constituent corporation, either before
the effective date of the merger or consolidation or within ten days
thereafter, shall notify each of the holders of any class or series of stock
of such constituent corporation who are entitled to appraisal rights of the
approval of the merger or consolidation and that appraisal rights are
available for any or all shares of such class or series of stock of such
constituent corporation, and shall include in such notice a copy of this
section; provided that, if the notice is given on or after the effective
date of the merger or consolidation, such notice shall be given by the
surviving or resulting corporation to all such holders of any class or
series of stock of a constituent corporation that are entitled to appraisal
rights. Such notice may, and, if given on or after the effective date of the
merger or consolidation shall, also notify such stockholders of the
effective date of the merger or consolidation. Any stockholder entitled to
appraisal rights may, within 20 days after the date of mailing of such
notice, demand in writing from the surviving or resulting corporation the
appraisal of such holder's shares. Such demand will be sufficient if it
reasonably informs the corporation of the identity of the stockholder and
that the stockholder intends thereby to demand the appraisal of such
holder's shares. If such notice did not notify stockholders of the effective
date of the merger of consolidation, either (i) each such constituent
corporation shall send a second notice before the
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effective date of the merger or consolidation notifying each of the holders
of any class or series of stock of such constituent corporation that are
entitled to appraisal rights of the effective date of the merger or
consolidation or (ii) the surviving or resulting corporation shall send such
a second notice to all such holders on or within 10 days after such
effective date; provided, however, that if such second notice is sent more
than 20 days following the sending of the first notice, such second notice
need only be sent to each stockholder who is entitled to appraisal rights
and who has demanded appraisal of such holder's shares in accordance with
this subsection. An affidavit of the secretary or assistant secretary or of
the transfer agent of the corporation that is required to give either notice
that such notice has been given shall, in the absence of fraud, be prima
facie evidence of the facts stated therein. For purposes of determining the
stockholders entitled to receive either notice, each constituent corporation
may fix, in advance, a record date that shall be not more than 10 days prior
to the date the notice is given, provided, that if the notice is given on or
after the effective date of the merger or consolidation, the record date
shall be such effective date. If no record date is fixed and the notice is
given prior to the effective date, the record date shall be the close of
business on the day next preceding the day on which the notice is given.
(e) Within 120 days after the effective date of the merger or consolidation,
the surviving or resulting corporation or any stockholder who has compiled with
subsections (a) and (d) hereof and who is otherwise entitled to appraisal
rights, may file a petition in the Court of Chancery demanding a determination
of the value of the stock of all such stockholders. Notwithstanding the
foregoing, at any time within 60 days after the effective date of the merger or
consolidation, any stockholder shall have the right to withdraw such
stockholder's demand for appraisal and to accept the terms offered upon the
merger or consolidation. Within 120 days after the effective date of the merger
or consolidation, any stockholder who has complied with the requirements of
subsections (a) and (d) hereof, upon written request, shall be entitled to
receive from the corporation surviving the merger or resulting from the
consolidation a statement setting forth the aggregate number of shares not voted
in favor of the merger or consolidation and with respect to which demands for
appraisal have been received and the aggregate number of holders of such shares.
Such written statement shall be mailed to the stockholder within 10 days after
such stockholder's written request for such a statement is received by the
surviving or resulting corporation or within 10 days after expiration of the
period for delivery of demands for appraisal under subsection (d) hereof,
whichever is later.
(f) Upon the filing of any such petition by a stockholder, service of a copy
thereof shall be made upon the surviving or resulting corporation, which shall
within 20 days after such service file in the office of the Register in Chancery
in which the petition was filed a duly verified list containing the names and
addresses of all stockholders who have demanded payment for their shares and
with whom agreements as to the value of their shares have not been reached by
the surviving or resulting corporation. If the petition shall be filed by the
surviving or resulting corporation, the petition shall be accompanied by such a
duly verified list. The Register in Chancery, if so ordered by the court, shall
give notice of the time and place fixed for the hearing of such petition by
registered or certified mail to the surviving or resulting corporation and to
the stockholders shown on the list at the addresses therein stated. Such notice
shall also be given by 1 or more publications at least 1 week before the day of
the hearing, in a newspaper of general circulation published in the city of
Wilmington, Delaware or such publication as the court deems advisable. The forms
of the notices by mail and by publication shall be approved by the court, and
the costs thereof shall be borne by the surviving or resulting corporation.
(g) At the hearing on such petition, the court shall determine the
stockholders who have complied with this section and who have become entitled to
appraisal rights. The Court may require the stockholders who have demanded an
appraisal for their shares and who hold stock represented by certificates to
submit their certificates of stock to the Register in Chancery for notation
thereon of the pendency of the appraisal proceedings as to such stockholder.
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(h) After determining the stockholders entitled to an appraisal, the Court
shall appraise the shares, determining their fair value exclusive of any element
of value arising from the accomplishment or expectation of the merger or
consolidation, together with a fair rate of interest, if any, to be paid upon
the amount determined to be the fair value. In determining such fair value, the
Court shall take into account all relevant factors. In determining the fair rate
of interest, the Court may consider all relevant factors, including the rate of
interest which the surviving or resulting corporation would have had to pay to
borrow money during the pendency of the proceeding. Upon application by the
surviving or resulting corporation or by any stockholder entitled to participate
in the appraisal proceeding, the court may, in its discretion, permit discovery
or other pretrial proceedings and may proceed to trial upon the appraisal prior
to the final determination of the stockholder entitled to an appraisal. Any
stockholder whose name appears on the list filed by the surviving or resulting
corporation pursuant to subsection (f) of this section and who has submitted
such stockholder's certificates of stock to the Register in Chancery, if such is
required, may participate fully in all proceedings until it is finally
determined that such stockholder is not entitled to appraisal rights under this
section.
(i) The Court shall direct the payment of the fair value of the shares,
together with interest, if any, by the surviving or resulting corporation to the
stockholders entitled thereto. Interest may be simple or compound, as the Court
may direct. Payment shall be so made to each such stockholder, in the case of
holders of uncertificated stock forthwith, and the case of holders of shares
represented by certificates upon the surrender to the corporation of the
certificates representing such stock. The Court's decree may be enforced as
other decrees in the Court of Chancery may be enforced, whether such surviving
or resulting corporation be a corporation of this State or of any state.
(j) The costs of the proceeding may be determined by the Court and taxed
upon the parties as the Court deems equitable in the circumstances. Upon
application of a stockholder, the Court may order all or a portion of the
expenses incurred by any stockholder in connection with the appraisal
proceeding, including, without limitation, reasonable attorney's fees and the
fees and expenses of experts, to be charged pro rata against the value of all
the shares entitled to an appraisal.
(k) From and after the effective date of the merger or consolidation, no
stockholder who has demanded appraisal rights as provided in subsection (d) of
this section shall be entitled to vote such stock for any purpose or to receive
payment of dividends or other distributions on the stock (except dividends or
other distributions payable to stockholders of record at a date which is prior
to the effective date of the merger or consolidation); provided, however, that
if no petition for an appraisal shall be filed within the time provided in
subsection (e) of this section, or if such stockholder shall deliver to the
surviving or resulting corporation a written withdrawal of such stockholder's
demand for an appraisal and an acceptance of the merger or consolidation, either
within 60 days after the effective date of the merger or consolidation as
provided in subsection (e) of this section or thereafter with the written
approval of the corporation, then the right of such stockholder to an appraisal
shall cease. Notwithstanding the foregoing, no appraisal proceeding in the court
of Chancery shall be dismissed was to any stockholder without the approval of
the Court, and such approval may be conditioned upon such terms as the Court
deems just.
(l) The shares of the surviving or resulting corporation to which the shares
of such objecting stockholders would have been converted had they assented to
the merger or consolidation shall have the status of authorized and unissued
shares of the surviving or resulting corporation.
C-4
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 102 of the Delaware General Corporation Law allows a corporation to
eliminate the personal liability of directors of a corporation to the
corporation or its stockholders for monetary damages for a breach of fiduciary
duty as a director, except where the director breached his duty of loyalty,
failed to act in good faith, engaged in intentional misconduct or knowingly
violated a law, authorized the payment of a dividend or approved a stock
repurchase in violation of Delaware corporate law or obtained an improper
personal benefit. The Registrant has included such a provision in its
Certificate of Incorporation.
Section 145 of the General Corporation Law of Delaware provides that a
corporation has the power to indemnify a director, officer, employee or agent of
the corporation and certain other persons serving at the request of the
corporation in related capacities against amounts paid and expenses incurred in
connection with an action or proceeding to which he is or is threatened to be
made a party by reason of such position, if such person shall have acted in good
faith and in a manner he reasonably believed to be in or not opposed to the best
interests of the corporation, and, in any criminal proceeding, if such person
had no reasonable cause to believe his conduct was unlawful; provided that, in
the case of actions brought by or in the right of the corporation, no
indemnification shall be made with respect to any matter as to which such person
shall have been adjudged to be liable to the corporation unless and only to the
extent that the adjudicating court determines that such indemnification is
proper under the circumstances.
Article NINTH of the Registrant's Amended and Restated Certificate of
Incorporation provides that a director or officer of the Registrant (a) shall be
indemnified by the Registrant against all expenses (including attorneys' fees),
judgements, fines and amounts paid in settlement incurred in connection with any
litigation or other legal proceeding (other than an action by or in the right of
the Registrant) brought against him by virtue of his position as a director or
officer of the Registrant if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interest of the
registrant, and, with respect to any criminal action or proceeding, has no
reasonable cause to believe his conduct was unlawful and (b) shall be
indemnified by the Registrant against all expenses (including attorneys' fees),
judgment, fines and amounts paid in settlement incurred in connection with any
action by or in the right of the Registrant brought against him by virtue of his
position as a director or officer of the Registrant if he acted in good faith
and in a manner he reasonably believed to be in, or not opposed to, the best
interests of the Registrant, except that no indemnification shall be made with
respect to any matter as to which such person shall have been adjudged to be
liable to the Registrants, unless a court determines that, despite such
adjudication but in view of all of the circumstances, he is entitled to
indemnification of such expenses. Notwithstanding the foregoing, to the extent
that a director or officer has been successful, on the merits or otherwise,
including, without limitation, the dismissal of an action without prejudice, he
is required to be indemnified by the Registrant against all expenses (including
attorneys' fees) incurred in connection therewith. Expenses shall be advanced to
a Director or officer at his request, provided that he undertakes to repay the
amount advanced if it is ultimately determined that he is not entitled to
indemnification for such expenses.
Indemnification is required to be made promptly unless the Registrant
determines that the applicable standard of conduct required for indemnification
has not been met. In the event the Registrant denies a request for
indemnification, or if the Registrant fails to dispose of a request for
indemnification within 60 days after such payment is claimed by the indemnitee,
such person is permitted to petition the court to make an independent
determination as to whether such person is entitled to indemnification. As a
condition precedent to the right of indemnification, the director or
II-1
<PAGE>
officer must give the Registrant notice of the action for which indemnity is
sought and the Registrant has the right to participate in such action or assume
the defense thereof.
Article NINTH of the Registrant's Amended and Restated Certificate of
Incorporation further provides that the indemnification provided herein is not
exclusive.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) EXHIBITS:
*5.1 Opinion of Hale and Dorr LLP as to the legality of the shares being
issued (including consent).
*8.1 Opinion of Hale and Dorr LLP regarding the federal income tax
consequences of the Merger (including consent).
23.1 Consent of Ernst & Young LLP relating to the audited financial
statements of the Registrant.
*23.2 Consent of Hale and Dorr LLP (included in Exhibit No. 5.1).
*23.3 Consent of Hale and Dorr LLP (included in Exhibit No. 8.1).
23.4 Consent of Arthur Andersen LLP
23.5 Consent of PricewaterhouseCoopers LLP
*24.1 Power of Attorney
*99.1 Consent of Deutsche Bank Securities Inc.
- ------------------------
* Previously filed.
ITEM 22. UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the
information set forth in the Registration Statement;
notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b)
if, in the aggregate, the changes in volume and price represent
no more than 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration
Fee" table in the effective Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration
Statement or any material change in such information in the
Registration Statement;
II-2
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at the time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
(c) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(d) The undersigned Registrant hereby undertakes as follows: that prior to
any public reoffering of the securities registered hereunder through use of a
prospectus which is a part of this Registration Statement, by any person or
party who is deemed to be an underwriter within the meaning of Rule 145(c), the
issuer undertakes that such reoffering prospectus will contain the information
called for by the applicable registration form with respect to reofferings by
persons who may be deemed underwriters, in addition to the information called
for by the other items of the applicable form.
(e) The Registrant undertakes that every prospectus: (i) that is filed
pursuant to paragraph (d) immediately preceding, or (ii) that purports to meet
the requirements of Section 10(a)(3) of the Securities Act and is used in
connection with an offering of securities subject to Rule 415, will be filed as
a part of an amendment to the Registration Statement and will not be used until
such amendment is effective, and that, for purposes of determining any liability
under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offering
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(f) The undersigned Registrant hereby undertakes to respond to requests for
information that is incorporated by reference into the prospectus pursuant to
Item 4, 10(b), 11 or 13 of this Form, within one business day of receipt of such
request, and to send the incorporated documents by first class mail or other
equally prompt means. This includes information contained in the documents filed
subsequent to the effective date of the Registration Statement through the date
of responding to the request.
(g) The undersigned Registrant hereby undertakes to supply by means of a
post-effective amendment all information concerning a transaction, and the
company being acquired involved therein, that was not the subject of and
included in the Registration Statement when it became effective.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Amendment No. 1 to the Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Cambridge, Commonwealth of Massachusetts, on this 28th day of April, 2000.
<TABLE>
<S> <C> <C>
MILLENNIUM PHARMACEUTICALS, INC.
By: /s/ JOHN B. DOUGLAS III
-----------------------------------------
John B. Douglas III
GENERAL COUNSEL
</TABLE>
Pursuant to the requirements of the Securities Act, this Amendment No. 1 to
the Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
SIGNATURES CAPACITY DATE
---------- -------- ----
<C> <S> <C>
Chairman of the Board and
* Chief Executive Officer
------------------------------------------- (Principal Executive April 28, 2000
Mark J. Levin Officer)
* Chief Financial Officer
------------------------------------------- (Principal Financial and April 28, 2000
Kevin P. Starr Accounting Officer)
*
------------------------------------------- Director April 28, 2000
Joshua Boger, Ph.D.
*
------------------------------------------- Director April 28, 2000
Eugene Cordes, Ph.D.
*
------------------------------------------- Director April 28, 2000
A. Grant Heidrich, III
*
------------------------------------------- Director April 28, 2000
Raju S. Kucherlapati, Ph.D.
*
------------------------------------------- Director April 28, 2000
Eric S. Lander, Ph.D.
</TABLE>
II-4
<PAGE>
<TABLE>
<CAPTION>
SIGNATURES CAPACITY DATE
---------- -------- ----
<C> <S> <C>
*
------------------------------------------- Director April 28, 2000
Christopher K. Mirabelli, Ph.D.
*
------------------------------------------- Director April 28, 2000
Steven C. Wheelwright, Ph.D.
</TABLE>
<TABLE>
<S> <C> <C>
/s/ JOHN B. DOUGLAS III
----------------------------------------
John B. Douglas III
*By: ATTORNEY-IN-FACT
</TABLE>
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- --------------------- -----------
<C> <S>
*5.1 Opinion of Hale and Dorr LLP as to the legality of the
shares being issued (including consent).
*8.1 Opinion of Hale and Dorr LLP regarding the federal income
tax consequences of the Merger (including consent).
23.1 Consent of Ernst & Young LLP relating to the audited
financial statements of the Registrant.
*23.2 Consent of Hale and Dorr LLP (included in Exhibit No. 5.1).
*23.3 Consent of Hale and Dorr LLP (included in Exhibit No. 8.1).
23.4 Consent of Arthur Andersen LLP.
23.5 Consent of PricewaterhouseCoopers LLP.
*24.1 Power of Attorney.
*99.1 Consent of Deutsche Bank Securities Inc.
</TABLE>
- ------------------------
* Previously filed.
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in
Amendment No. 1 to the Registration Statement (Form S-4 No. 333-33912) and
related Prospectus of Millennium Pharmaceuticals, Inc. and to the
incorporation by reference therein of our report dated January 27, 2000, with
respect to the consolidated financial statements of Millennium
Pharmaceuticals, Inc. included in its Annual Report (Form 10-K) for the year
ended December 31, 1999 filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Boston, Massachusetts
April 25, 2000
<PAGE>
EXHIBIT 23.4
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this Registration Statement of our report dated
January 29, 1999 on the LeukoSite, Inc. financial statements as of December 31,
1997 and 1998 and for the three years in the period ended December 31, 1998
and to all references to our Firm included in or made part of this
Registration Statement.
/s/ ARTHUR ANDERSEN LLP
Boston, Massachusetts
April 25, 2000
<PAGE>
EXHIBIT 23.5
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Amendment No. 1
to the Registration Statement on Form S-4 (File No. 333-33912) of Millennium
Pharmaceuticals, Inc. of our report dated February 12, 1999 relating to the
financial statements of CytoMed, Inc., which appears in the Current Report on
Form 8-K/A of Millennium Pharmaceuticals, Inc. dated January 6, 2000. We also
consent to the reference to us under the heading "Experts" in such
Registration Statement.
PRICEWATERHOUSECOOPERS LLP
Boston, Massachusetts
April 25, 2000
