SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report
(Date of earliest event reported): AUGUST 15, 1995
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SOMATIX THERAPY CORPORATION
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(Exact name of registrant as specified in charter)
DELAWARE 0-14758 94-2762045
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(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
850 MARINA VILLAGE PARKWAY, ALAMEDA, CALIFORNIA 94501
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number,
including area code: (510) 748-3000
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(Former Name or Former Address, if Changed Since Last Report.)
Page 1 of 4
Exhibit Index on Page 4
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Item 5. Other Events
On June 22, 1995, the Board of Directors of Somatix Therapy
Corporation (the "Company") approved a $20 million investment in
the Company by Bristol-Myers Squibb Company ("Bristol-Myers") in
return for certain rights in the area of cancer gene therapy.
Bristol-Myers made an initial equity investment of $10
million in the Company's stock at a premium to the market. After
January 1, 1996, and subject to the Company's obtaining release from
regulatory agencies to start a Phase II clinical trial for its
GVAX [TRADEMARK] 1/ cancer vaccine, Bristol-Myers will purchase an
additional $10 million of the Company's stock, also at a premium to
the market.
In addition to an equity investment in the Company,
Bristol-Myers will have a five year right of first offer with
regard to collaborations with the Company in any of its internally
initiated oncology programs. The Company will notify Bristol-Myers
of its intention to seek a corporate partner, thus giving
Bristol-Myers an early opportunity to expand its relationship with
the Company.
As part of the agreement, Leon E. Rosenberg, M.D., President
of Bristol-Myers Pharmaceutical Research Institute, will be
nominated to the Company's Board of Directors. In addition, the
companies will meet twice annually to review scientific and
clinical accomplishments at the Company and to discuss specific
areas of potential collaboration.
Copies of the Press Release announcing Bristol-Myers'
investment and the Stock Purchase Agreement entered into between
the Company and Bristol-Myers are attached hereto as Exhibits 5.1
and 5.2, respectively, and each such document is hereby
incorporated by reference in its entirety.
____________________
1/ GVAX is a trademark of Somatix Therapy Corporation.
Item 7. Exhibits
Exhibit No. Description
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99.1 Press Release dated August 15, 1995.
99.2* Stock Purchase Agreement, dated August 15,
1995, between Somatix Therapy Corporation and
Bristol-Myers Squibb Company
____________________
* Confidential treatment has been requested as to certain portions
of this agreement.
2.
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SIGNATURES
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Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly authorized.
Date: September 20, 1995 SOMATIX THERAPY CORPORATION
(Registrant)
By: Mark N.K. Bagnall
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Name: Mark N.K. Bagnall
Title: Vice President, Chief
Financial Officer and Secretary
3.
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Somatix Therapy Corporation
Exhibit Index
to Form 8-K
Sequentially
Numbered
Exhibit No. Description Page
----------- ----------- ------------
99.1 Press Release, dated August 15, 1995. 5
99.2* Stock Purchase Agreement, dated 9
August 15, 1995, between Somatix
Therapy Corporation and Bristol-
Myers Squibb Co.
__________________________
* Confidential treatment has been requested as to certain portions
of this agreement.
SOMATIX THERAPY CORPORATION
STOCK PURCHASE AGREEMENT
August 15, 1995
<PAGE>
TABLE OF CONTENTS
PAGE
1. Purchase and Sale . . . . . . . . . . . . . . . . . . . . . 1
1.1 The First Purchase . . . . . . . . . . . . . . . . . . 1
1.2 The Second Purchase. . . . . . . . . . . . . . . . . . 1
1.3 Closing . . . . . . . . . . . . . . . . . . . . . . . 2
1.4 Other Actions. . . . . . . . . . . . . . . . . . . . . 2
2. Conditions to Obligations. . . . . . . . . . . . . . . 2
2.1 Conditions to Investor's Obligations
at Closing. . . . . . . . . . . . . . . . . . . . 2
2.2 Conditions to the Company's Obligations
at Closing . . . . . . . . . . . . . . . . . . . 3
3. Representations and Warranties of the Company. . . . . 4
3.1 Corporate Power . . . . . . . . . . . . . . . . . 4
3.2 Authorization . . . . . . . . . . . . . . . . . . 4
3.3 Governmental Approvals. . . . . . . . . . . . . . 4
3.4 Litigation. . . . . . . . . . . . . . . . . . . . 4
3.5 Subsidiaries; Charter Documents . . . . . . . . . 4
3.6 Financial Statements. . . . . . . . . . . . . . . 4
3.7 Absence of Certain Developments . . . . . . . . . 5
3.8 Absence of Undisclosed Liabilities. . . . . . . . 5
3.9 Business. . . . . . . . . . . . . . . . . . . . . 5
3.10 Non-Contravention . . . . . . . . . . . . . . . . 5
3.11 Filings . . . . . . . . . . . . . . . . . . . . . 5
4. Representations and Warranties of Investor . . . . . . 6
4.1 Investment Experience.. . . . . . . . . . . . . . 6
4.2 Purchase for Own Account. . . . . . . . . . . . . 6
4.3 Restricted Securities . . . . . . . . . . . . . . 6
4.4 Information . . . . . . . . . . . . . . . . . . . 6
4.5 Legend. . . . . . . . . . . . . . . . . . . . . . 7
5. Investor Rights. . . . . . . . . . . . . . . . . . . . 7
5.1 Information Rights. . . . . . . . . . . . . . . . 7
5.2 Board Representation. . . . . . . . . . . . . . . 7
5.3 Rights with Respect to Oncology Partnership
Proposals . . . . . . . . . . . . . . . . . . . . 7
6. Registration Rights. . . . . . . . . . . . . . . . . . 9
<PAGE>
7. Miscellaneous. . . . . . . . . . . . . . . . . . . . . 9
7.1 No Waiver; Cumulative Remedies. . . . . . . . . . 9
7.2 Amendments, Waivers and Consents. . . . . . . . . 9
7.3 Addresses for Notices . . . . . . . . . . . . . . 10
7.4 Expenses. . . . . . . . . . . . . . . . . . . . . 10
7.5 Successors and Assigns. . . . . . . . . . . . . . 10
7.6 Survival of Representations and Warranties. . . . 11
7.7 Prior Agreements. . . . . . . . . . . . . . . . . 11
7.8 Severability. . . . . . . . . . . . . . . . . . . 11
7.9 Public Disclosure . . . . . . . . . . . . . . . . 11
7.10 Governing Law . . . . . . . . . . . . . . . . . . 11
7.11 Headings. . . . . . . . . . . . . . . . . . . . . 11
7.12 Counterparts. . . . . . . . . . . . . . . . . . . 11
7.13 Attorney's Fees . . . . . . . . . . . . . . . . . 11
ii.
<PAGE>
STOCK PURCHASE AGREEMENT
THIS AGREEMENT is made and entered into as of this 15th
day of August, 1995 between Somatix Therapy Corporation, a Delaware
corporation (the "Company") and Bristol-Myers Squibb Company, a
Delaware corporation ("Investor").
THE PARTIES HEREBY AGREE AS FOLLOWS:
1. PURCHASE AND SALE.
1.1 THE FIRST PURCHASE.
a. Upon the terms and subject to the conditions of
this Agreement, the Company agrees to sell to Investor, and
Investor agrees to purchase from the Company on the First Closing
Date (as defined below) that number of shares of the Company's
Common Stock ("Common Stock") which equals Ten Million Dollars
($10,000,000) divided by [INFORMATION HAS BEEN OMITTED HEREIN PURSUANT
TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2.] of
the average closing price of the Company's Common Stock as reported
by the Nasdaq National Market for the consecutive five (5) business
days ending two business days prior to the First Closing Date.
b. The closing of the transaction contemplated by
this Section 1.1 (the "First Closing") shall occur at the close of
business on the effective date of this Agreement, or such other
date as may be agreed to in writing by the parties (the "First
Closing Date").
1.2 THE SECOND PURCHASE.
a. Upon the terms and subject to the conditions of
this Agreement, the Company agrees to sell to Investor, and
Investor agrees to purchase from the Company on the Second Closing
Date (as defined below), that number of shares of the Company's
Common Stock which equals Ten Million Dollars ($10,000,000) divided
by [INFORMATION HAS BEEN OMITTED HEREIN PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2.] of the average closing
price of the Company's Common Stock as reported by the Nasdaq National
Market for the consecutive five (5) business days ending two
business days prior to the Second Closing Date.
b. The closing of the transaction contemplated by
this Section 1.2 (the "Second Closing") shall occur on the tenth
business day following the Company's written notification to
Investor that the Company has received the approvals and/or
releases from all relevant government agencies or bodies required
for the Company to
1.
<PAGE>
initiate a Phase II GVAX cancer vaccine clinical trial, or at such
other time as Investor and the Company may mutually agree in
writing (the "Second Closing Date").
1.3 CLOSING. The First Closing and the Second Closing
(collectively, the "Closing" and each, a "Closing") shall take
place at 10:00 AM at the offices of Brobeck, Phleger & Harrison in
Palo Alto, California, or at such other time and place as Investor
and the Company may agree. At each Closing,
a. Investor shall deliver to the Company the
relevant purchase price for the Common Stock being purchased in
immediately available funds by check or by wire transfer to an
account of the Company designated by the Company, by notice to
Investor, on the relevant Closing Date; and
b. The Company shall deliver to Investor a
certificate for the Common Stock being purchased at such Closing
registered in the name of Investor.
1.4 OTHER ACTIONS. The Company and Investor agree to
take any actions necessary, including without limitation any
filings required under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended ("Hart-Scott-Rodino"), to permit the valid
issuance and delivery of the shares pursuant to this Section 1. In
the event a filing under Hart-Scott-Rodino is required, the
applicable Closing Date shall occur no less than ten (10) days
following receipt of clearance of such filing.
2. CONDITIONS TO OBLIGATIONS.
2.1 CONDITIONS TO INVESTOR'S OBLIGATIONS AT CLOSING.
The obligation of Investor to purchase and pay for the Common Stock
contemplated by Section 1 at the First Closing and Second Closing
shall be subject to the satisfaction of each of the following
conditions precedent, any one or more of which may be waived by
Investor:
a. REPRESENTATIONS AND WARRANTIES. Each of the
representations and warranties of the Company set forth in
Section 3 shall be true and correct as if made on the applicable
Closing Date, provided that the representations set forth in
Sections 3.5, 3.7 and 3.8 need be true and correct only on the
First Closing Date.
b. PERFORMANCE. The Company shall have performed
and complied with all agreements, obligations and conditions
contained in this Agreement that are required to be performed or
complied with by it on or before the Closing Date.
c. COMPLIANCE CERTIFICATE. The Chief Executive
Officer of the Company shall deliver to the Investor at the Closing
a certificate certifying that the conditions specified in
subsections (a), (b), (e) and (f) have been fulfilled.
2.
<PAGE>
d. OPINION OF COUNSEL TO THE COMPANY. Investor
shall have received from Brobeck, Phleger & Harrison, counsel for
the Company, an opinion dated as of the Closing Date, substantially
in the form set forth in EXHIBIT A attached to this Agreement.
e. QUALIFICATIONS. All authorizations,
approvals, or permits, if any, of any governmental authority or
regulatory body of the United States or of any state that are
required in connection with the lawful issuance and sale of the
Common Stock to Investor pursuant to this Agreement shall have been
duly obtained and shall be effective on and as of the Closing.
f. PROCEEDINGS AND DOCUMENTS. All corporate and
other proceedings in connection with the transactions contemplated
at the First Closing and all documents incident thereto shall be
reasonably satisfactory in form and substance to Investor and
Investor's counsel, and they shall have received all such
counterpart original and certified or other copies of such
documents as they may reasonably request.
2.2 CONDITIONS TO THE COMPANY'S OBLIGATIONS AT CLOSING.
The obligation of the Company to sell and deliver the Common Stock
contemplated by Section 1 at the First Closing and the Second
Closing shall be subject to the satisfaction of each of the
following conditions precedent, any one or more of which may be
waived by the Company:
a. REPRESENTATIONS AND WARRANTIES. Each of the
representations and warranties of Investor set forth in Section 4
shall be true and correct as if made on the applicable Closing
Date.
b. PAYMENT OF PURCHASE PRICE. Investor shall have
delivered payment of the aggregate purchase price of the Common
Stock to be purchased by it.
c. PROCEEDINGS AND DOCUMENTS. All corporate and
other proceedings in connection with the transactions contemplated
at the Closing and all documents incident thereto shall be
satisfactory in form and substance to the Company and the Company's
counsel, and they shall have received all such counterpart original
and certified or other copies of such documents as they may
reasonably request.
d. PERFORMANCE. Investor has performed and
complied with all agreements, obligations and conditions contained
in this Agreement that are required to be performed or complied
with by it on or before such Closing.
e. QUALIFICATIONS. All authorizations, approvals,
or permits, if any, of any governmental authority or regulatory
body of the United States or of any state that are required in
connection with the lawful issuance and sale of the Common Stock to
Investor pursuant to this Agreement shall have been duly obtained
and shall be effective on and as of the Closing.
3.
<PAGE>
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The
Company hereby represents and warrants to Investor as follows:
3.1 CORPORATE POWER. The Company is a corporation duly
organized, validly existing and in good standing under the laws of
the State of Delaware and is qualified to do business as a foreign
corporation in each jurisdiction where failure to qualify would
have a materially adverse effect on the business or properties of
the Company. The Company has full power and authority to own its
property, to carry on its business as presently conducted and to
carry out the transactions contemplated hereby.
3.2 AUTHORIZATION. The Company has full power to
execute, deliver and perform this Agreement, and this Agreement has
been duly executed and delivered by the Company and is the legal,
valid and, assuming due execution by the other parties hereto,
binding obligation of the Company, enforceable in accordance with
its terms, subject to applicable bankruptcy, insolvency,
moratorium, reorganization or similar laws affecting creditors'
rights generally, and to general equitable principles. The
execution, delivery and performance of this Agreement including the
sale, issuance and delivery of the Common Stock, have been duly
authorized by all necessary corporate action of the Company.
3.3 GOVERNMENTAL APPROVALS. Based in part on the
representations made by Investor in Section 4, no authorization,
consent, approval, license, exemption of or filing or registration
with any court or governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, under any
applicable laws, rules or regulations presently in effect, is or
will be necessary for, or in connection with, the offer, issuance,
sale, execution and delivery by the Company of the Common Stock or
for the performance by the Company of its obligations under this
Agreement, except for filings under applicable securities laws
which will be made by the Company within the prescribed periods.
3.4 LITIGATION. There is no litigation or governmental
proceeding or investigation pending or, to the best knowledge of
the Company, threatened against the Company materially and
adversely affecting the execution and delivery of this Agreement or
the ability of the Company to issue the shares of its Common Stock
to be issued at each Closing.
3.5 SUBSIDIARIES; CHARTER DOCUMENTS. As of the First
Closing, the Company has no active subsidiaries and does not
otherwise directly or indirectly control any other business entity.
The Company has furnished Investor with certified copies of its
Certificate of Incorporation and Bylaws, together with any
amendments thereto as of the date hereof.
3.6 FINANCIAL STATEMENTS. The Company has delivered to
Investor a copy of the Company's Quarterly Report on Form 10-Q for
the quarters ending December 31, 1994 and March 31, 1995 and all
subsequent quarters to which the Company is required to file a
Quarterly Report on Form 10-Q, and a copy of the
4.
<PAGE>
Company's Annual Report to Stockholders for the fiscal year ended
June 30, 1994, containing audited consolidated and consolidating
balance sheets, statements of income and changes in financial
position for the Company for the fiscal years ended June 30, 1994,
June 30, 1993 and June 30, 1992 and all subsequent Annual Reports
to Stockholders (the "Financial Statements"). The Financial
Statements are complete and correct in all matters and respects,
have been prepared in accordance with generally accepted accounting
principles, consistently applied, and fairly present the financial
position of the Company as of each such date and the results of
operations for each such period then ended.
3.7 ABSENCE OF CERTAIN DEVELOPMENTS. Since March 31,
1995, except as disclosed in the Financial Statements, there has
been no (i) material adverse change in the condition, financial or
otherwise, of the Company or its assets, liabilities, properties,
business, operations or prospects generally, (ii) declaration,
setting aside or payment of any dividend or other distribution with
respect to the capital stock of the Company, or (iii) loss,
destruction or damage to any property of the Company, whether or
not insured, which has or may have a material adverse effect on the
Company.
3.8 ABSENCE OF UNDISCLOSED LIABILITIES. Except as and
to the extent reflected or stated in the Financial Statements,
except for liabilities arising in the ordinary course of its
business since March 31, 1995, the Company has no material accrued
or contingent liability arising out of any transaction or state of
facts existing prior to the date hereof.
3.9 BUSINESS. The Company has all necessary franchises,
permits, governmental licenses and other governmental rights and
privileges necessary to permit it to own its property and to
conduct its present business, except where the failure to do so
would not have a material adverse effect on the Company or its
business. the Company is not in violation of any law, regulation,
authorization or order of any public authority relevant to the
ownership of its properties or the carrying on of its present
business, except where such violation would not have a material
adverse effect on the condition, assets, liabilities, prospects,
business or properties of the Company.
3.10 NON-CONTRAVENTION. The execution, delivery and
performance by the Company of this Agreement does not and will not
(i) contravene or conflict with the certificate of incorporation or
bylaws of the Company, or (ii) contravene or conflict with or
constitute a violation of any provision of any law, regulation,
judgment, injunction, order or decree binding upon or applicable to
the Company in any manner which would materially and adversely
affect Investor's rights or its ability to realize the intended
benefits under this agreement.
3.11 FILINGS. The Company has filed all reports required
to be filed with the Securities and Exchange Commission (the
"Commission") under the Securities Exchange Act of 1934 (the "1934
Act"), including (i) the Company's annual report on Form 10-K for
the fiscal year ended June 30, 1994, (ii) its quarterly reports on
Form 10-Q for its fiscal quarters ending March 31, 1995 and
December 31 and September 30,
5.
<PAGE>
1994, and (iii) all of its other reports (including without
limitation reports on Form 8-K, statements, schedules and
registration statements filed with the Commission since June 30,
1994). As of its filing date, no such report or statement filed
pursuant to the 1934 Act contained any untrue statement of a
material fact or omitted to state any material fact necessary in
order to make the statements made therein, in the light of the
circumstances under which they were made, not misleading.
4. REPRESENTATIONS AND WARRANTIES OF INVESTOR.
Investor hereby represents and warrants to the Company as follows:
4.1 INVESTMENT EXPERIENCE. Investor is an "accredited
investor" within the meaning of Rule 501 under the Securities Act
of 1933, as amended, (the "Securities Act") and was not organized
for the specific purpose of acquiring the Common Stock. It has
sufficient knowledge and experience in investing in companies
similar to the Company in terms of the Company's stage of
development so as to be able to evaluate the risks and merits of
its investment in the Company and it is able financially to bear
the risks thereof.
4.2 PURCHASE FOR OWN ACCOUNT. Investor is acquiring the
Common Stock for investment for its own account and not with the
view to, or for resale in connection with, any distribution
thereof. Investor has no present intention of selling, granting
any participation in, or otherwise distributing the same. Investor
does not have any contract, undertaking, agreement or arrangement
with any person to sell, transfer, or grant participations to such
person or to any third person, with respect to any of the Common
Stock. Investor understands that the shares of Common Stock have
not been registered under the Securities Act by reason of an
exemption from the registration provisions of the Securities Act
which depends upon, among other things, the bona fide nature of its
investment intent as expressed herein.
4.3 RESTRICTED SECURITIES. Investor understands that
the Common Stock may not be sold, transferred, or otherwise
disposed of without registration under the Securities Act, or an
exemption therefrom, and that in the absence of an effective
registration statement covering the Common Stock or an available
exemption from registration under the Securities Act, the Common
Stock must be held indefinitely. In the absence of an effective
registration statement covering the Common Stock, Investor will
sell, transfer, or otherwise dispose of the Common Stock only in a
manner consistent with its representations and agreements set forth
herein.
4.4 INFORMATION. Investor acknowledges that it has
received all the information it has requested from the Company and
considers necessary or appropriate for deciding whether to purchase
the Common Stock. Investor represents that it has had an
opportunity to ask questions and receive answers from the Company
regarding the Company and the terms and conditions of the offering
of the Common Stock, and to obtain an additional information
necessary to verify the accuracy of the information given the
Investor.
6.
<PAGE>
4.5 LEGEND. It is understood that the certificates
evidencing the Common Stock may bear substantially the following
legend:
a. THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933. THEY MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION
STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT
OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 OF
SUCH ACT.
b. Any legend required by the laws of the State of
California or any other applicable jurisdiction.
4.6 LIMITATIONS ON DISPOSITION. Investor agrees not to
make any disposition of all or any portion of the shares of the
Company's Common Stock purchased pursuant to this Agreement unless
and until (a) there is then in effect a Registration Statement
under the Securities Act of 1933 covering such proposed disposition
and such disposition is made in accordance with such Registration
Statement; or (b) Investor shall have notified the Company of the
proposed disposition and shall have furnished the Company with a
detailed statement of the circumstances surrounding the proposed
disposition, and if reasonably requested by the Company, such
Investor shall have furnished the Company with an opinion of
counsel, reasonably satisfactory to the Company that such
disposition will not require registration of such shares under the
Act. It is agreed that the Company will not require opinions of
counsel for transactions made pursuant to Rule 144 except in
unusual circumstances.
5. INVESTOR RIGHTS. The Company shall for a period of
five (5) years from the First Closing Date (the "Rights Period")
provide Investor with the following rights and privileges:
5.1 INFORMATION RIGHTS. The Company shall provide
Investor with semi-annual comprehensive scientific seminars on its
scientific and clinical progress in the area of gene therapy to be
held at such time and place as is determined by the parties.
5.2 BOARD REPRESENTATION. The Company shall nominate
and use its best efforts to have elected to the Company's Board of
Directors a representative of Investor, which representative shall
be subject to the reasonable approval of the Company. If the
Company is unable to have such representative elected to its Board
of Directors, such representative shall have the right to receive
notice of and to attend all meetings of the Company's Board of
Directors.
5.3 RIGHTS WITH RESPECT TO ONCOLOGY PARTNERSHIP
PROPOSALS. Subject to the terms and conditions specified in this
Section 5.3, the Company hereby grants to
7.
<PAGE>
Investor certain rights ("Oncology Rights"), with respect to
discrete drug discovery development programs in the field of
oncology that are internally initiated by the Company (each an
"Oncology Program"), [INFORMATION HAS BEEN OMITTED HEREIN
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2.]
Notwithstanding the previous sentence, Investor shall have
certain rights with respect to the Excluded Programs as
provided in Section 5.3(c) below.
a. SCOPE OF ONCOLOGY RIGHTS. Prior to entering
into a corporate partnering transaction with a third party with
respect to a particular Oncology Program, whether for research,
development, manufacturing, and/or marketing purposes (a "Corporate
Transaction"), or in the event the Company is approached by a third
party with respect to a Corporate Transaction, the Company shall
deliver written notice to Investor of its intention to enter into
such Corporate Transaction (the "Transaction Notice"). Such
Transaction Notice shall (i) identify the particular vector and
gene covered by such Oncology Program as well as sufficient
scientific data and other confidential information as may allow the
Investor to evaluate the research and development status of such
Oncology Program and (ii) set forth all material business terms and
conditions of the proposed Corporate Transaction.
b. PARTICIPATION RIGHTS OF INVESTOR. From the
date Investor receives the Transaction Notice, Investor shall have
the right to evaluate, discuss and negotiate in good faith the
definitive terms and conditions of a Corporate Transaction
regarding such Oncology Program with the Company for a period not
to exceed ninety (90) days (the "Negotiation Period"). If within
such ninety (90) day period the Company and Investor enter into a
binding letter of intent containing the principal terms of an
agreement with respect to a Corporate Transaction, then both
parties shall have an additional ninety (90) days to complete and
execute the definitive agreements for such Corporate Transaction.
If at any time during a Negotiation Period, Investor determines
that it does not intend in good faith to pursue a Corporate
Transaction with the Company, Investor shall so notify the Company
and thereby terminate the Company's obligations under this Section
5.3 for a period of eighteen (18) months from the date of the
Transaction Notice. If, despite mutual good faith attempts at
negotiation, the Company and Investor cannot agree on terms and
conditions for the Corporate Transaction, then Investor shall have
the right, during the Negotiation Period to deliver to the Company
a binding written offer executed by the Investor containing
definitive terms and conditions for a Corporate Transaction on such
Oncology Program (the "Firm Offer"). If the Investor has delivered
a Firm Offer to the Company and the Company has chosen not to
accept such Firm Offer, then the Company shall agree, for a period
of eighteen (18) months not to enter into a Corporate Transaction
with respect to such Oncology Program with any third party unless
the terms and conditions of such Corporate Transaction are, on
balance, more favorable to the Company than those set forth in the
Firm Offer. If Investor disputes that any Corporate Transaction
proposed to be consummated by the Company is on terms not more
favorable to the Company than
8.
<PAGE>
the terms contained in its Firm Offer, then such dispute shall
first be resolved by the chief executive officers of the Company
and Investor's pharmaceutical group, using such valuation practices
as are customary and reasonable given the circumstances. If the
parties still cannot agree, then they shall engage the services of
a mutually acceptable nationally recognized investment bank which
shall deliver a written opinion on the relative value to the
Company of the terms and conditions of the two proposals. If such
opinion indicates that the terms and conditions of the third party
transaction are materially less favorable to the Company than those
set forth in the Firm Offer, then the Company shall not be entitled
to consummate the third party transaction without first reoffering
such transaction to the Investor. Notwithstanding the foregoing,
once a period of eighteen (18) months has passed since the date of
any Transaction Notice for any Oncology Program, the Company shall
once again be required to deliver a Transaction Notice with respect
to such Oncology Program prior to entering into any Corporate
Transaction for such Oncology Program with a third party.
c. RIGHTS WITH RESPECT TO EXCLUDED PROGRAMS. In
the event the Company has not entered into a Corporate Transaction
with a third party within eighteen (18) months from the First
Closing Date with respect to an Excluded Program, then such
Excluded Program shall become part of Oncology Rights at the end of
such eighteen (18) month period. In addition, the Company hereby
represents and warrants to the Investor that it may, even prior to
the expiration of such eighteen (18) month period discuss or enter
into a collaborative relationship with respect to a specific gene
and vector development program encompassed within the Excluded
Program during the term of this Agreement, and will enter into such
discussion upon request by the Investor.
6. REGISTRATION RIGHTS. The Company agrees to provide
Investor with the registration rights as set forth on EXHIBIT A
attached hereto and incorporated by this reference.
7. MISCELLANEOUS.
7.1 NO WAIVER; CUMULATIVE REMEDIES. No failure or delay
on the part of Investor or the Company in exercising any right,
power or remedy hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise of any such right, power or
remedy preclude any other or further exercise thereof or the
exercise of any other right, power or remedy hereunder. The
remedies herein provided are cumulative and not exclusive of any
remedies provided by law.
7.2 AMENDMENTS, WAIVERS AND CONSENTS. Except as
otherwise expressly provided in this Agreement, changes in or
additions to this Agreement may be made, and compliance with any
covenant or provision herein or therein set forth may be omitted or
waived, so long as the parties so agree in writing. Any waiver or
consent may be given subject to satisfaction of conditions stated
therein and any waiver or consent shall be effective only to the
extent expressly set forth therein.
9.
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7.3 ADDRESSES FOR NOTICES. All notices, requests,
demands and other communications provided for hereunder shall be in
writing (including telegraphic communication) and mailed or
telegraphed or telecopied or delivered to the applicable party at
the addresses indicated below:
If to the Company:
Somatix Therapy Corporation
1301 Marina Village Parkway
Suite 310
Alameda, CA 94501-1034
Attention: Edward O. Lanphier
with a copy to:
Brobeck, Phleger & Harrison
2200 Geng Road
Palo Alto, CA 94303
Attention: J. Stephan Dolezalek, Esq.
If to Investor:
Bristol-Myers Squibb Company
Pharmaceutical Research Institute
Pharmaceutical Group
P.O. Box 4000
Princeton, N.J. 08543-4000
Attention: Charles Linzner, Esq.
Either party may change its address by written notice to the other
party complying as to delivery with the terms of this Section. All
such notices, requests, demands and other communications shall,
when mailed or telecopied or telegraphed, respectively, be
effective when deposited in the mails or delivered to the telegraph
company, respectively, addressed as aforesaid.
7.4 EXPENSES. Irrespective of whether the Closing(s)
are effected, the Company shall pay all costs and expenses that it
incurs with respect to the negotiation, execution, delivery and
performance of this Agreement. If any action at law or in equity
is necessary to enforce or interpret the terms of this Agreement,
the prevailing party shall be entitled to reasonable attorney's
fees, costs and necessary disbursements in addition to any other
relief to which such party may be entitled.
7.5 SUCCESSORS AND ASSIGNS. Except as otherwise
provided herein, the terms and conditions of this Agreement shall
inure to the benefit of and be binding upon
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the respective successors and assigns of the parties. Nothing in
this Agreement, express or implied, is intended to confer upon any
party other than the parties hereto or their respective successors
and assigns any rights, remedies, obligations, or liabilities under
or by reason of this Agreement, except as expressly provided in
this Agreement.
7.6 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made in this Agreement shall survive
the execution and delivery hereof and the Closing(s) hereunder, and
shall in no way be affected by any investigation of the subject
matter thereof made by or on behalf of the Investor or the Company.
7.7 PRIOR AGREEMENTS. This Agreement constitutes the
entire agreement between the parties and supersedes any prior
understandings or agreements concerning the subject matter hereof.
7.8 SEVERABILITY. The invalidity or unenforceability of
any provision hereof shall in no way affect the validity or
enforceability of any other provision.
7.9 PUBLIC DISCLOSURE. Neither party shall make any
public disclosure concerning the transactions contemplated hereby
without prior consultation with the other party; provided, however,
that nothing herein shall preclude either party from making such
disclosure as is required by applicable laws binding on it as long
as the disclosing party has exercised good faith efforts under the
circumstances to consult with the other party as provided in this
Section 7.9.
7.10 GOVERNING LAW. This Agreement shall be governed by
and construed in accordance with, the laws of the State of Delaware
without giving effect to principles of conflict of laws.
7.11 HEADINGS. Section and subsection headings in this
Agreement are included herein for convenience of reference only and
shall not constitute a part of this Agreement for any other
purpose.
7.12 COUNTERPARTS. This Agreement may be executed in any
number of counterparts, all of which taken together shall
constitute one and the same instrument, and either of the parties
hereto may execute this Agreement by signing any such counterpart.
7.13 ATTORNEY'S FEES. If any action at law or in equity
is brought for a breach of representation or warranty made herein
or necessary to enforce or interpret the terms of this Agreement,
the prevailing party shall be entitled to reasonable attorney's
fees, costs and necessary disbursements in addition to any other
relief to which such party may be entitled.
11.
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IN WITNESS WHEREOF, the Company and Investor have
caused this Agreement to be executed by their respective officers
thereunto duly authorized, as of the date first above written.
SOMATIX THERAPY CORPORATION
By: ______________________________________
Title: ___________________________________
Date: ____________________________________
INVESTOR
By: ______________________________________
Title: ___________________________________
Date: ____________________________________
12.
FOR IMMEDIATE RELEASE
For further information, please contact:
Mark Bagnall
Chief Financial Officer
Somatix Therapy Corporation
510-748-3064
William Dunnett
Bristol-Myers Squibb Company
609-252-5094
BRISTOL-MYERS SQUIBB INVESTS IN SOMATIX
COMPANIES TO EVALUATE POSSIBLE AREAS FOR COLLABORATION IN GENE
THERAPY
(ALAMEDA, Calif. and Princeton, N.J. -- August 15, 1995)
Somatix Therapy Corporation (NASDAQ:SOMA) and Bristol-Myers
Squibb Company (NYSE:BMY) today announced that Bristol-Myers
Squibb will make a $20 million investment in Somatix in return
for certain rights in the area of cancer gene therapy.
Bristol-Myers Squibb has made an initial equity investment
of $10 million in Somatix stock at a premium to the market. After
January l, 1996, and subject to Somatix obtaining release from
regulatory agencies to start a Phase II clinical trial for its
GVAX [TRADEMARK]* cancer vaccine, Bristol-Myers Squibb will purchase
an additional $10 million in Somatix stock also at a premium.
In addition to an equity investment in Somatix,
Bristol-Myers Squibb will have a five year right of first offer
with regard to collaborations with Somatix in any of its
internally initiated oncology programs. Somatix will notify
Bristol-Myers Squibb of its intention to seek a corporate
partner, giving Bristol-Myers Squibb an early opportunity to
expand its relationship with Somatix.
<PAGE>
As part of the agreement, Leon E. Rosenberg, M.D.,
president, Bristol-Myers Squibb Pharmaceutical Research
Institute, will be nominated to the Somatix Board of Directors.
In addition, the companies will meet twice annually to review
scientific and clinical accomplishments at Somatix and to discuss
specific areas of potential collaboration.
Gene therapy involves the transfer of genes into cells for
therapeutic benefit. While early in its development, this
technology could address such diseases as Parkinson's disease,
Alzheimer's disease, cystic fibrosis, hypertension,
cardiovascular disease and cancer. Although there is no gene
therapy product currently on the market available to patients,
many researchers believe that it holds the key to the effective
treatment and cure of a wide range of genetic and acquired
diseases.
"Gene therapy offers great promise in treating many types of
diseases," said Dr. Rosenberg. "Somatix is a clear leader in
realizing the potential of gene therapy by having a broad
portfolio of gene transfer technologies, recruiting an excellent
scientific team and building a strong proprietary position. We
look forward to joining forces with them to fully explore the
medical needs that can be addressed with this novel form of
therapy."
David W. Carter, chief executive officer and chairman of
Somatix, said "Bristol-Myers Squibb is an internationally
respected healthcare company with a proven track record in
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developing, manufacturing and marketing products for the
treatment of cancer. Our agreement with this pharmaceutical
leader serves as a recognition of Somatix's strengths in the
field of gene therapy. We look forward to close interaction with
our new partners, particularly with Dr. Rosenberg when he joins
the Board, and to a fruitful relationship with Bristol-Myers
Squibb."
The agreement between the two companies occurs on the heels
of Somatix's private placement financing, which yielded the
company $16.5 million. With the additional investment and
commitments from Bristol-Myers Squibb, Somatix now has about two
years of cash reserves.
Bristol-Myers Squibb is a diversified worldwide health and
personal care company whose principal businesses are
pharmaceuticals, consumer products, nutritionals and medical
devices. It is a leading maker of innovative therapies for
cardiovascular, metabolic and infectious diseases, central
nervous system and dermatological disorders, and cancer. The
company is also preeminent in consumer medicines, orthopedic
devices, ostomy care, wound management, nutritional supplements,
infant formulas, and hair and skin care products.
Somatix Therapy Corporation is a leader in the field of gene
therapy. The company intends to research, develop and
commercialize proprietary processes for the genetic modification
of cells and their use in the treatment of human disease.
Somatix's assets include its highly efficient gene transfer
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technology, broad-based intellectual property and product
development programs focused on cancer and degenerative
neurological diseases.
###
* GVAX is a trademark of Somatix Therapy Corporation.
4.
