<PAGE> 1
As filed with the Securities and Exchange Commission on , 1996
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Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
GUILFORD PHARMACEUTICALS INC.
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(Exact name of registrant as specified in its charter)
DELAWARE
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(State or other jurisdiction of incorporation or organization)
52-1841960
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(I.R.S. employer identification no.)
6611 Tributary Street, Baltimore, Maryland 21224
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(Address of principal executive offices) (Zip code)
GUILFORD PHARMACEUTICALS INC. 1993 EMPLOYEE SHARE OPTION AND RESTRICTED SHARE
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PLAN
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GUILFORD PHARMACEUTICALS INC. 401(k) PLAN
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GUILFORD PHARMACEUTICALS INC. NON-QUALIFIED STOCK OPTION AGREEMENT
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(RICHARD L. CASEY)
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GUILFORD PHARMACEUTICALS INC. NON-QUALIFIED STOCK OPTION AGREEMENT
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(JOHN H. NEWMAN)
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CONSULTING AGREEMENT (HENRY H. BREM)
------------------------------------
CONSULTING AGREEMENT (ROBERT S. LANGER)
---------------------------------------
CONSULTING AGREEMENT (KAM W. LEONG)
-----------------------------------
CONSULTING AGREEMENT (SOLOMON H. SNYDER)
----------------------------------------
(Full title of the plan)
CRAIG R. SMITH, M.D.
CHIEF EXECUTIVE OFFICER
GUILFORD PHARMACEUTICALS INC.
6611 TRIBUTARY STREET
BALTIMORE, MARYLAND 21224
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(Name and address of agent for service)
(410) 631-6302
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(Telephone number, including area code, of agent for service)
Copy to:
MICHAEL J. SILVER
HOGAN & HARTSON L.L.P.
111 SOUTH CALVERT STREET
BALTIMORE, MARYLAND 21202
(410) 659-2741
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=============================================================================================================================
Title of securities Amount to be Proposed Proposed maximum Amount of
to be registered registered(1) maximum offering aggregate offering registration fee(1)
price per share(1) price(1)
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<S> <C> <C> <C> <C>
Common Stock, par 467,175 (a) $ 14.92 (a) $ 6,970,251 (a) $ 2,112.20
value $.01 per share 1,332,825 (b) $ 16.875 (b) $ 22,491,421 (b) $ 6,815.58
100,000 (c) $ 16.875 (c) $ 1,687,500 (c) $ 511.36
75,000 (d) $ 13.54 (d) $ 1,015,500 (d) $ 307.73
45,000 (e) $ 13.54 (e) $ 609,300 (e) $ 184.64
225,000 (f) $ 11.11 (f) $ 2,499,750 (f) $ 757.50
225,000 (g) $ 11.11 (g) $ 2,499,750 (g) $ 757.50
7,500 (h) $ 18.00 (h) $ 135,000 (h) $ 40.91
22,500 (i) $ 16.875 (i) $ 379,688 (i) $ 115.06
90,000 (j) $ 5.92 (j) $ 532,800 (j) $ 161.45
Total Fee: $11,763.93
=============================================================================================================================
</TABLE>
<PAGE> 2
(1) Pursuant to Rule 457(h)(1), the proposed maximum offering price
per share, proposed maximum aggregate offering price and the amount of the
registration fee are based on (a) the weighted average option exercise price of
$14.92 per share for the 467,175 shares issuable upon exercise of currently
outstanding options under the Guilford Pharmaceuticals Inc. 1993 Employee Share
Option and Restricted Share Plan (the "Option Plan"), (b) the last sale price
of $16.875 per share of Guilford Pharmaceuticals Inc. Common Stock on The
Nasdaq Stock Market's National Market on December 10, 1996 with respect to the
other 1,732,825 shares otherwise issuable under the Option Plan, (c) the last
sale price of $16.875 per share of Guilford Pharmaceuticals Inc. Common Stock
on The Nasdaq Stock Market's National Market on December 10, 1996 with respect
to the 100,000 shares issuable under the Guilford Pharmaceuticals Inc. 401(k)
Plan, (d) the exercise price of $13.54 per share of the 75,000 shares issuable
upon exercise of options under the Guilford Pharmaceuticals Inc. Non-Qualified
Stock Option Agreement (Richard L. Casey), (e) the exercise price of $13.54 per
share of the 45,000 shares issuable upon exercise of options under the Guilford
Pharmaceuticals Inc. Non-Qualified Stock Option Agreement (John H. Newman), (f)
the weighted average exercise price of $11.11 per share of the 225,000 shares
issuable upon exercise of options under the Consulting Agreement (Henry H.
Brem), (g) the weighted average exercise price of $11.11 per share of the
225,000 shares issuable upon exercise of options under the Consulting Agreement
(Robert S. Langer), (h) the exercise price of $18.00 per share of 7,500 shares
issuable upon exercise of options under the Consulting Agreement (Kam S.
Leong), (i) the last sale price of $16.875 per share of Guilford
Pharmaceuticals Inc. Common Stock on The Nasdaq Stock Market's National Market
on December 10, 1996 with respect to 22,500 shares issuable upon exercise of
options under the Consulting Agreement (Kam S. Leong), and (j) the exercise
price of $5.92 per share of the 90,000 shares issuable upon exercise of options
under the Consulting Agreement (Solomon H. Snyder), listed above. In addition,
pursuant to Rule 416(c) under the Securities Act of 1933, as amended, this
registration statement also covers an indeterminate amount of interests to be
offered or sold pursuant to the Guilford Pharmaceuticals Inc. 401(k) Plan
described herein.
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<PAGE> 3
REGISTRATION OF ADDITIONAL SECURITIES
In accordance with Section E of the General Instructions to
Form S-8, the contents of Form S-8, Registration No. 33-90828, filed by
Guilford Pharmaceuticals Inc. (the "Registrant") with the Securities and
Exchange Commission on March 31, 1995, are incorporated herein by reference for
the registration of 1,900,000 shares of additional securities issuable pursuant
to the Guilford Pharmaceuticals Inc. 1993 Employee Share Option and Restricted
Share Plan, as amended, and the Guilford Pharmaceuticals Inc. 401(k) Plan, as
amended and restated.
<PAGE> 4
REGISTRATION OF NEW SECURITIES
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The documents containing the information specified in Part I
will be sent or given to each person eligible to participate in the Guilford
Pharmaceuticals Inc. Non-Qualified Stock Option Agreement (Richard L. Casey),
the Guilford Pharmaceuticals Inc. Non-Qualified Stock Option Agreement (John H.
Newman), the Consulting Agreement (Henry H. Brem), the Consulting Agreement
(Robert S. Langer), the Consulting Agreement (Kam S. Leong) and the Consulting
Agreement (Solomon H. Snyder) as specified by Rule 428(b)(1). In accordance
with the instructions to Part I of Form S-8, such documents will not be filed
with the Commission either as part of this Registration Statement or as
prospectuses or prospectus supplements pursuant to Rule 424.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The Registrant hereby incorporates by reference into this
registration statement the following documents:
(a) The Registrant's Annual Report on Form 10-K for the
year ended December 31, 1995;
(b) The Registrant's current report on Form 8-K filed on
September 24, 1996;
(c) The Registrant's current report on Form 8-K filed on
October 15, 1996;
(d) All reports filed with the Securities and Exchange
Commission pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934, as amended (the
"Exchange Act"), since December 31, 1995; and
(e) The description of the Registrant's Common Stock
contained in the Registrant's Registration Statement on
Form 8-A filed with the Securities and Exchange
Commission on March 25, 1994 and registering shares of
Common Stock pursuant to Section 12(g) of the Exchange
Act.
In addition, all documents filed by the Registrant subsequent
to the date hereof pursuant to Sections 13(a), 13(c), 14, or 15(d) of the
Exchange Act, subsequent to the filing of this Registration Statement and prior
to the filing of a post-effective amendment
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<PAGE> 5
which indicates that all securities offered have been sold or which deregisters
all securities remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statement and to be part of hereof from the date
of the filing of such documents.
Any statement contained in a document incorporated or deemed
to be incorporated by reference shall be deemed to be modified or superseded to
the extent that a statement contained in any other subsequently filed document
which also is or is deemed to be incorporated by reference herein modifies or
supersedes such prior statement. The documents required to be so modified or
superseded shall not be deemed to constitute a part of this Registration
Statement, except as so modified or superseded.
To the extent that any proxy statement is incorporated by
reference herein, such incorporation shall not include any information
contained in such proxy statement which is not, pursuant to the Commission's
rules, deemed to be "filed" with the Commission or subject to the liabilities
of Section 18 of the Exchange Act.
ITEM 4. DESCRIPTION OF SECURITIES.
A description of the Registrant's Common Stock is incorporated
by reference into this Registration Statement under Item 3.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law ("DGCL")
authorizes a court to award, or a corporation's board of directors to grant
indemnity to directors and officers under certain circumstances for liabilities
incurred in connection with their activities in such capacities (including
reimbursement for expenses incurred). Article NINTH of the Company's Amended
and Restated Certificate of Incorporation provides that the Company will
indemnify its directors and officers to the full extent permitted by law and
that no director shall be liable for monetary damages to the Registrant or its
stockholders for any breach of fiduciary duty, except to the extent provided by
applicable law (i) for any breach of the director's duty of loyalty to the
Registrant or its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (iii)
pursuant to Section 174 of the DGCL or (iv) for any transaction from which such
director derived an improper personal benefit. In addition, under
indemnification agreements with its directors and officers, the Registrant is
obligated, to the fullest extent permissible by the DGCL, as it currently
exists or may be amended, to indemnify and hold harmless its directors and
officers, from and against all expense, liability and loss reasonably incurred
or suffered by such directors and officers.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
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<PAGE> 6
ITEM 8. EXHIBITS.
<TABLE>
<CAPTION>
Exhibit
Number Description
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<S> <C>
3.1 Amended and Restated Certificate of Incorporation of the Registrant (incorporated by
reference to Exhibit 3.02, Registration Statement on Form S-1, Registration No. 33-76938,
filed March 25, 1994)
3.2 Amended and Restated Bylaws of the Registrant (incorporated by reference to Exhibit 3.04,
Registration Statement on Form S-1, Registration No. 33-76938, filed March 25, 1994),
3.2a Amendments to Amended and Restated Bylaws of the Registrant
4.1a Guilford Pharmaceuticals Inc. 1993 Employee Share Option and Restricted Share Plan ("Option
Plan") (incorporated by reference to Exhibit 10.02, Registration Statement on Form S-1,
Registration No. 33-76938, filed March 25, 1994)
4.1b Amendment to 1993 Employee Share Option and Restricted Share Plan, adopted by the Board of
Directors effective December 21, 1994 (incorporated by reference to Exhibit 10.02B, Annual
Report on Form 10-K for the year ended December 31, 1994)
4.1c Amendment to 1993 Employee Share Option and Restricted Share Plan, adopted by the Board of
Directors effective May 21, 1996 (incorporated by reference to Exhibit 10.44, Quarterly
Report on Form 10-Q for the period ended June 30, 1996)
4.1d Guilford Pharmaceuticals Inc. Non-Qualified Stock Option Agreement (Richard L. Casey)
</TABLE>
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<PAGE> 7
<TABLE>
<S> <C>
4.1e Guilford Pharmaceuticals Inc. Non-Qualified Stock Option Agreement (John H. Newman)
4.1f Consulting Agreement (Henry H. Brem)
4.1g Consulting Agreement (Robert S. Langer)
4.1h Consulting Agreement (Kam S. Leong)
4.1i Consulting Agreement (Solomon H. Snyder) (incorporated by reference to Exhibit 10.19 to Form
S-1, Registration No. 33-76938, filed March 25, 1994)
4.1j Amendment to Consulting Agreement (Solomon H. Snyder) (incorporated by reference to Exhibit
10.20A, Annual Report on Form 10-K for the year ended December 31, 1995)
4.3 Form of Stock Option Agreement related to the Option Plan (incorporated by reference to
Exhibit 4.3 on Form S-8, Registration No. 33-90828, filed March 31, 1995)
4.5 Form of Restricted Share Purchase Agreement related to the Option Plan (incorporated by
reference to Exhibit 4.5 on Form S-8, Registration No. 33-90828, filed March 31, 1995)
5 Opinion of Hogan & Hartson L.L.P. Regarding the Legality of the Shares of Common Stock Being
Registered
23.1 Consent of Hogan & Hartson L.L.P. (included in Exhibit 5)
23.2 Consent of KPMG Peat Marwick LLP
24 Power of Attorney
</TABLE>
ITEM 9. 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:
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<PAGE> 8
(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;
(iii) To include any material information with
respect to the plan of distribution not previously
disclosed in the registration statement or any material
change to such information in the registration
statement.
Provided, however, that paragraphs (a)(1)(i) and
(a)(1)(ii) do not apply if the registration statement is
on Form S-3 or Form S-8, and the information required to
be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(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
that 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) 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 Exchange Act (and, where applicable, each filing of an employee
benefit plan's annual report pursuant to Section 15(d) of the Exchange Act)
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.
(c) 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 the expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful defense of
any action, suit or
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<PAGE> 9
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.
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<PAGE> 10
SIGNATURES AND POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933,
the Registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Baltimore, State of Maryland, on this 13th day
of December, 1996.
GUILFORD PHARMACEUTICALS INC.
By:
-------------------------------------------
Craig R. Smith, M.D.
President, Chief Executive Officer and
Chairman
We, the undersigned officers and directors of Guilford
Pharmaceuticals Inc., hereby severally and individually constitute and appoint
Craig R. Smith, Andrew R. Jordan, Thomas C. Seoh and Michael J. Silver, and
each of them, the true and lawful attorneys and agents of each of us to execute
in the name, place and stead of each of us (individually and in any capacity
stated below) any and all amendments to this Registration Statement on Form
S-8, and all instruments necessary or advisable in connection therewith and to
file the same with the Securities and Exchange Commission, each of said
attorneys and agents to have power to act with or without the other and to have
full power and authority to do and perform in the name and on behalf of each of
the undersigned every act whatsoever necessary or advisable to be done in the
premises as fully and to all intents and purposes as any of the undersigned
might or could do in person, and we hereby ratify and confirm our signatures as
they may be signed by our said attorneys and agents and each of them to any and
all such amendment and amendments.
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
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<S> <C> <C>
/s/ CRAIG R. SMITH, M.D. President, December 13, 1996
-------------------------- Chief Executive Officer
Craig R. Smith, M.D. and Chairman (Principal
Executive Officer)
/s/ ANDREW R. JORDAN Vice President, December 13, 1996
---------------------- Chief Financial Officer and
Andrew R. Jordan Treasurer
(Principal Financial
Officer and Principal Accounting
Officer)
Board of Directors:
By: /s/ CRAIG R. SMITH, M.D. Director December 13, 1996
--------------------------
Craig R. Smith, M.D.
</TABLE>
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<PAGE> 11
<TABLE>
<S> <C> <C>
By: /s/ SOLOMON H. SNYDER , M.D. Director December 13, 1996
------------------------------
Solomon H. Snyder, M.D.
By: /s/ RICHARD L. CASEY Director December 13, 1996
----------------------
Richard L. Casey
By: /s/ W. LEIGH THOMPSON, M.D., Ph.D. Director December 13, 1996
------------------------------------
W. Leigh Thompson, M.D., Ph.D.
By: /s/ ELIZABETH M. GREETHAM Director December 13, 1996
---------------------------
Elizabeth M. Greetham
By: /s/ GEORGE L. BUNTING, JR . Director December 13, 1996
-----------------------------
George L. Bunting, Jr.
</TABLE>
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<PAGE> 12
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Sequential
Number Description Page Number
- ------ ----------- -----------
<S> <C> <C>
3.1 Amended and Restated Certificate of Incorporation of *
Guilford Pharmaceuticals Inc.
3.2 Amended and Restated Bylaws of Guilford *
Pharmaceuticals Inc.
3.2a Amendments to Amended and Restated
Bylaws of Guilford Pharmaceuticals Inc.
4.1a Guilford Pharmaceuticals Inc. 1993 Employee
Share Option and Restricted Share Plan ("Option Plan") *
4.1b Amendment to Option Plan, adopted by the Board
of Directors effective December 21, 1994 **
4.1c Amendment to Option Plan, adopted by the Board
of Directors effective May 21, 1996 ***
4.1d Guilford Pharmaceuticals Inc. Non-Qualified
Stock Option Agreement (Richard L. Casey)
4.1e Guilford Pharmaceuticals Inc. Non-Qualified
Stock Option Agreement (John H. Newman)
4.1f Consulting Agreement (Henry H. Brem)
4.1g Consulting Agreement (Robert S. Langer)
4.1h Consulting Agreement (Kam S. Leong)
4.1i Consulting Agreement (Solomon H. Snyder) *
4.1j Amendment to Consulting Agreement
(Solomon H. Snyder) ****
4.3 Form of Stock Option Agreement
related to the Option Plan *****
4.5 Form of Restricted Share Purchase Agreement
related to the Option Plan *****
5 Opinion of Hogan & Hartson L.L.P. Regarding
the Legality of the Shares of Common
Stock Being Registered
23.1 Consent of Hogan & Hartson L.L.P. ******
23.2 Consent of KPMG Peat Marwick LLP
</TABLE>
<PAGE> 13
<TABLE>
<S> <C> <C>
24 Power of Attorney *******
</TABLE>
- ----------------------
* Included as an Exhibit to the Registrant's Registration
Statement on Form S-1, Registration No. 33-76938, and
incorporated herein by reference.
** Included as an Exhibit to the Registrant's Annual Report on
Form 10-K for the year ended December 31, 1994 and
incorporated herein by reference.
*** Included as an Exhibit to the Registrant's Form 10-Q for the
period ended June 30, 1996.
**** Included as an Exhibit to the Registrant's Annual Report on
Form 10-K for the year ended December 31, 1995 and
incorporated herein by reference.
***** Included as an Exhibit to the Registrant's Registration
Statement on Form S-8, Registration No. 33-90828, and
incorporated herein by reference.
****** Included in Exhibit 5.
******* Contained on signature page.
<PAGE> 1
EXHIBIT 3.2a
AMENDMENTS TO BYLAWS EFFECTIVE DECEMBER 2, 1996
RESOLVED , that pursuant to Section 9 of the Amended and Restated Bylaws of the
Corporation (the "Bylaws"), Section 3.11 of the Bylaws is deleted in its
entirety and replaced with the following:
"3.11 Committees of Directors. The board of
directors may designate 1 or more committees, each committee
to consist of 1 or more directors of the Corporation. The
board may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified
member at any meeting of the committee. In the absence or
disqualification of a member of a committee, the member or
members present at any meeting and not disqualified from
voting, whether or not such member or members constitute a
quorum, may unanimously appoint another member of the board of
directors to act at the meeting in the place of any such
absent or disqualified member. Any such committee of the
Corporation, to the extent provided in the resolution of the
board of directors, shall have and may exercise all the powers
and authority of the board of directors in the management of
the business and affairs of the Corporation, and may authorize
the seal of the Corporation to be affixed to all papers which
may require it; but no such committee shall have the power or
authority in reference to the following matters: (i) approving
or adopting, or recommending to the stockholders, any action
or matter expressly required by the General Corporation Law of
the State of Delaware, as amended, to be submitted to
stockholders for approval or (ii) adopting, amending or
repealing any bylaw of the Corporation. Such committee or
committees shall have such name or names as may be determined
from time to time by resolution adopted by the board of
directors. Unless otherwise specified in the resolution of
the board of directors designating the committee or in these
bylaws, at all meetings of each such committee of directors, a
majority of the total number members of the committee shall
constitute a quorum for the transaction of business, and the
vote of a majority of the members of the committee present at
any meeting at which there is a quorum shall be the act of the
committee. Each committee shall keep regular minutes of its
meeting and report the same to the board of directors, when
required."
RESOLVED, that, pursuant to Section 9 of the Bylaws, Sections 5.1 through 5.4
and 5.9 through 5.12 of said Bylaws be, and the same hereby are, amended and
restated as set forth below:
"5. Officers.
<PAGE> 2
5.1 Positions. The officers of the Corporation
shall be a chairman and a secretary, and such other officers as the
board of directors or the chairman may appoint, including one or more
vice chairmen, a president, one or more vice presidents (all of the
foregoing, "Executive Officers"), a treasurer, assistant secretaries
and assistant treasurers, who shall exercise such powers and perform
such duties as shall be determined from time to time by the board or
by the chairman. Any number of offices may be held by the same
person, unless the certificate of incorporation or these bylaws
otherwise provide; provided, however, that in no event shall the
chairman and the secretary be the same person.
5.2 Appointment. The Executive Officers of the
Corporation shall be chosen by the board of directors at its first
meeting after each annual meeting of stockholders.
5.3 Compensation. The compensation of all
Executive Officers of the Corporation shall be fixed by the board of
directors or a duly appointed committee thereof.
5.4 Term of Office. The chairman shall hold
office until his or her successor is chosen and qualifies or until
his or her earlier resignation, death or removal. Any officer may
resign at any time upon written notice to the Corporation. Any
officer elected or appointed by the board of directors or by the
chairman may be removed at any time, with or without cause, either by
the affirmative vote of a majority of the board of directors, or by
the chairman in his or her discretion. Any vacancy occurring in any
office of the Corporation shall be filled either by the board of
directors or (in the case of all officers other than the chairman) by
the chairman.
*****
5.9 Secretary. The secretary shall attend all
meetings of the board of directors and all meetings of the
stockholders, and shall record all the proceedings of the meetings of
the stockholders and of the board of directors in a book to be kept
for that purpose, and shall perform like duties for the standing
committees, when required. The secretary shall give, or cause to be
given, notice of all meetings of the stockholders and special meetings
of the board of directors, and shall perform such other duties as may
be prescribed by the board of directors or by the president, under
whose supervision the secretary shall be. The secretary shall have
custody of the corporate seal of the Corporation, and the secretary,
or an assistant secretary, shall have the authority to affix the same
to any instrument requiring it, and when so affixed it may be attested
by the signature of the secretary or by the signature of such
assistant secretary. The board of directors or the chairman may give
general authority to any other officer to affix the seal of the
Corporation and to attest the affixing by such officer's signature.
The secretary or
<PAGE> 3
an assistant secretary may also attest all instruments signed by the
chairman, the president or any vice president.
5.10 Assistant Secretary. The assistant
secretary, or if there be more than one, the assistant secretaries in
the order determined by the board of directors or by the chairman (or
if there shall have been no such determination, then in the order of
their election), shall, in the absence of the secretary or in the
event of the secretary's inability or refusal to act, perform the
duties and exercise the powers of the secretary, and shall perform
such other duties and have such other powers as the board of directors
or the chairman may from time to time prescribe.
5.11 Treasurer.
5.11.1 Duties. The treasurer shall have the custody
of the corporate funds and securities and shall keep full and accurate
accounts of receipts and disbursements in books belonging to the
Corporation, and shall deposit all moneys and other valuable effects
in the name and to the credit of the Corporation in such depositories
as may be designated by the board of directors or by the chairman.
The treasurer shall disburse the funds of the Corporation as ordered
by the board of directors or by the chairman, taking proper vouchers
for such disbursements, and shall render to the chairman, and to the
board of directors at its regular meetings, or when the board of
directors so requires, an account of all transactions as treasurer and
of the financial condition of the Corporation.
5.11.2 Bond. If required by the board of directors
or by the chairman, the treasurer shall give the Corporation a bond in
such sum and with such surety or sureties as shall be satisfactory to
the board of directors for the faithful performance of the duties of
the treasurer's office and for the restoration to the Corporation, in
case of the treasurer's death, resignation, retirement or removal from
office, of all books, papers, vouchers, money and other property of
whatever kind, in the treasurer's possession or under the treasurer's
control and belonging to the Corporation.
5.12 Assistant Treasurer. The assistant
treasurer, or if there shall be more than one, the assistant
treasurers in the order determined by the board of directors or by the
chairman (or if there shall have been no such determination, then in
the order of their election), shall, in the absence of the treasurer
or in the event of the treasurer's inability or refusal to act,
perform the duties and exercise the powers of the treasurer, and shall
perform such other duties and have such other powers as the board of
directors or the chairman may from time to time prescribe."
<PAGE> 1
EXHIBIT 4.1d
GUILFORD PHARMACEUTICALS INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
<PAGE> 2
GUILFORD PHARMACEUTICALS INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
1. GRANT OF OPTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
---------------
2. PRICE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
-----
3. EXERCISE OF OPTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
------------------
3.1 TIME OF EXERCISE OF OPTION. . . . . . . . . . . . . . . . . . . . . . 1
--------------------------
3.2 EXERCISE BY OPTIONEE. . . . . . . . . . . . . . . . . . . . . . . . . 2
--------------------
3.3 TERMINATION OF OPTION. . . . . . . . . . . . . . . . . . . . . . . . . 2
---------------------
3.4 LIMITATIONS ON EXERCISE OF OPTION. . . . . . . . . . . . . . . . . . . 2
---------------------------------
3.5 REDUCTION IN NUMBER OF SHARES SUBJECT TO OPTION. . . . . . . . . . . . 2
-----------------------------------------------
4. METHOD OF EXERCISE OF OPTION. . . . . . . . . . . . . . . . . . . . . . . . . 3
----------------------------
5. LIMITATIONS ON TRANSFER. . . . . . . . . . . . . . . . . . . . . . . . . . . 4
-----------------------
6. RIGHTS AS STOCKHOLDER. . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
---------------------
7. EFFECT OF CHANGES IN CAPITALIZATION. . . . . . . . . . . . . . . . . . . . . 4
-----------------------------------
7.1 CHANGES IN SHARES. . . . . . . . . . . . . . . . . . . . . . . . . . . 4
-----------------
7.2 REORGANIZATION IN WHICH THE CORPORATION
---------------------------------------
IS THE SURVIVING ENTITY. . . . . . . . . . . . . . . . . . . . . . . . 4
-----------------------
7.3 REORGANIZATION IN WHICH THE CORPORATION
---------------------------------------
IS NOT THE SURVIVING CORPORATION OR SALE
----------------------------------------
OF ASSETS OR STOCK. . . . . . . . . . . . . . . . . . . . . . . . . . 5
-------------------
7.4 ADJUSTMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
-----------
8. GENERAL RESTRICTIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
--------------------
9. WITHHOLDING OF TAXES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
--------------------
10. DISCLAIMER OF RIGHTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
--------------------
11. INTERPRETATION OF THIS OPTION AGREEMENT. . . . . . . . . . . . . . . . . . . 7
---------------------------------------
12. GOVERNING LAW; JURISDICTION. . . . . . . . . . . . . . . . . . . . . . . . . 7
---------------------------
13. DATE OF GRANT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
-------------
14. BINDING EFFECT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
--------------
15. NOTICE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
------
16. ENTIRE AGREEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
----------------
</TABLE>
<PAGE> 3
GUILFORD PHARMACEUTICALS INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
This Stock Option Agreement (the "Option Agreement") is made
as of the 27th day of March, 1996, by and between Guilford Pharmaceuticals Inc.
(the "Corporation") and Richard L. Casey, a non-employee director of the
Corporation (the "Optionee").
NOW, THEREFORE, in consideration of the mutual promises and
covenants contained herein, the parties hereto do hereby agree as follows:
1. GRANT OF OPTION.
Subject to the approval of the Corporation's stockholders, the
Corporation hereby grants to the Optionee the right and option (the "Option")
to purchase from the Corporation, on the terms and subject to the conditions
hereinafter set forth, 50,000 shares of common stock, par value $.01 per share,
of the Corporation ("Stock"). This Option shall not constitute an incentive
stock option within the meaning of section 422 of the Internal Revenue Code of
1986, as amended (the "Code").
2. PRICE.
The purchase price (the "Option Price") for the shares of
Stock subject to the Option granted by this Option Agreement is $20.3125 per
share (the fair market value of the Stock).
3. EXERCISE OF OPTION.
Except as otherwise provided herein, the Option granted
pursuant to this Option Agreement shall be subject to exercise as follows:
3.1 TIME OF EXERCISE OF OPTION.
The Option shall become exercisable as to 30,000 shares six
months after the date of grant (but shall not be exercisable before approval of
the Plan by the stockholders of the Corporation). The Option shall be
exercisable as to 10,000 shares of Stock on each of the first two anniversaries
of the date of grants. The foregoing installments, to the extent not
exercised, shall accumulate and be exercisable, in whole or in part, at any
time and from time to time, after becoming exercisable and prior to termination
of the Option; provided, that no single exercise of
<PAGE> 4
an Option shall be for less than 100 shares or the maximum number of shares
available for purchase under the Option at the time of exercise, if less.
3.2 EXERCISE BY OPTIONEE.
During the lifetime of the Optionee, only the Optionee (or, in
the event of the Optionee's legal incapacity or incompetency, the Optionee's
guardian or legal representative) may exercise the Option.
3.3 TERMINATION OF OPTION.
The Option shall terminate ten (10) years after the date of
grant of the Option, as set forth in Section 13 below unless previously
terminated following the Optionee ceasing to be a member of the Corporation's
board of directors ("Board"). If the Optionee ceases to be a member of the
Board, any unexercised or partially exercised Option held by the Optionee shall
terminate in accordance with the following provisions:
(i) If termination of Board service is for any reason other
than a termination due to (a) retirement from the Board upon reaching the age
set by the Board for the retirement of Directors; (b) failure to stand for
election to the board with the Board's consent; (c) resignation from the board
with the Board's consent; or (d) death, the Option shall terminate immediately;
(ii) If the termination of Board service is for reasons "a"
through "c" enumerated above, the Option shall become fully exercisable and
shall continue in force for the duration of its term, subject to the following
regarding the Optionee's death; or
(iii) If termination of Board service is due to Optionee's
death, or in the event of a former Director's death following a termination of
Board service for reasons "a" through "c" enumerated above, the Option shall
become fully exercisable and shall continue in force for one year following the
date of death.
3.4 LIMITATIONS ON EXERCISE OF OPTION.
Notwithstanding the foregoing Subsections of this Section, in
no event may the Option be exercised, in whole or in part, after the earlier of
(i) ten (10) years following the date upon which the Option is granted, as set
forth in Section 13 below or (ii) the occurrence of an event referred to in
Section 7 below which results in termination of the Option. In no event may
the Option be exercised for a fractional Share.
3.5 REDUCTION IN NUMBER OF SHARES SUBJECT TO OPTION.
<PAGE> 5
The number of shares which may be purchased upon exercise of
the Option pursuant to this Section shall be reduced by the number of shares
previously purchased upon exercise of the Option pursuant to this Section.
4. METHOD OF EXERCISE OF OPTION.
Subject to the terms and conditions of this Option Agreement,
an Optionee may, at any time, exercise an Option with respect to all or any
part of the shares of Stock then subject to such Option by giving the
Corporation written notice of exercise, specifying the number of shares as to
which the Option is being exercised. Such notice shall be addressed to the
Secretary of the Corporation at the Corporation's principal office, and shall
be effective when actually received (by personal delivery, fax or other
delivery) by the Secretary of the Corporation. Such notice shall be
accompanied by an amount equal to the Exercise Price of such shares, in the
form of any one or combination of the following: (i) cash or cash equivalents,
(ii) shares of Stock valued at fair market value in accordance with the Plan,
(iii) by the delivery of a promissory note of the person exercising the Option
to the Corporation bearing interest at one (1) percent above the average
interest rate paid by the Corporation on Corporation indebtedness on the date
of exercise and repayable in equal annual installments over no more than five
(5) years; or (iv) by causing the Corporation to withhold shares of Stock
otherwise issuable pursuant to the exercise of an Option equal in value to the
Option Price or portion thereof to be satisfied pursuant to this clause (iv).
Shares of Stock acquired by the Optionee through exercise of an Option may be
surrendered in payment of the Exercise Price of Options; provided, however,
that any Stock surrendered in payment must have been (a) held by the Optionee
for more than six months at the time of surrender or (b) acquired under an
Option granted not less than six months prior to the time of surrender.
Payment in full of the Exercise Price need not accompany the written notice of
exercise provided the notice directs that the Stock certificate or certificates
for the shares for which the Option is exercised be delivered to a licensed
broker acceptable to the Corporation as the agent for the individual exercising
the Option and, at the time such Stock certificate or certificates are
delivered, the broker tenders to the Corporation cash (or cash equivalents
acceptable to the Corporation) equal to the Exercise Price. For purposes of
this Option Agreement, "fair market value" means the value of each share of
Stock subject to this Option determined as follows: If on the date of grant or
other determination date the Stock is listed on an established national or
regional stock exchange, is admitted to quotation on the National Association
of Securities Dealers Automated Quotation System, or is publicly traded on an
established securities market, the fair market value of the Stock shall be the
closing price of the Stock on such exchange or in such market (the highest such
closing price if there is more than one such exchange or market) on the trading
day immediately preceding the date of grant or other determination date (or, if
there is no such reported closing price, the fair market value shall be the
mean between the highest bid and lowest asked prices or between the high and
low sale prices on such trading day), or, if no sale of the Stock is reported
for such trading day, on the next preceding day on which any sale shall have
been reported. If the Stock is not listed on such
- 3 -
<PAGE> 6
an exchange, quoted on such System or traded on such a market, fair market
value shall be determined by the Board. "Exercise Price" means the Option
Price multiplied by the number of shares of Stock purchased pursuant to
exercise of an Option.
5. LIMITATIONS ON TRANSFER.
The Option is not transferable by the Optionee, other than by
will or the laws of descent and distribution in the event of death of the
Optionee and shall not be pledged or hypothecated (by operation of law or
otherwise) or subject to execution, attachment or similar processes.
6. RIGHTS AS STOCKHOLDER.
Neither the Optionee nor any executor, administrator,
distributee or legatee of the Optionee's estate shall be, or have any of the
rights or privileges of, a stockholder of the Corporation in respect of any
shares transferable hereunder unless and until such shares have been fully paid
and certificates representing such shares have been endorsed, transferred and
delivered, and the name of the Optionee (or of such personal representative,
administrator, distributee or legatee of the Optionee's estate) has been
entered as the stockholder of record on the books of the Corporation.
7. EFFECT OF CHANGES IN CAPITALIZATION.
7.1 CHANGES IN SHARES.
If the number of outstanding shares of Stock is increased or
decreased or changed into or exchanged for a different number or kind of stock
or other securities of the Corporation by reason of any recapitalization,
reclassification, Stock split, reverse split, combination of Stock, exchange of
Stock, Stock dividend or other distribution payable in capital stock, or other
increase or decrease in such shares effected without receipt of consideration
by the Corporation occurring after the date the Option is granted, a
proportionate and appropriate adjustment shall be made by the Corporation in
the number and kind of shares subject to the Option, so that the proportionate
interest of the Optionee immediately following such event shall, to the extent
practicable, be the same as immediately prior to such event. Any such
adjustment in the Option shall not change the total Option Price with respect
to shares subject to the unexercised portion of the Option but shall include a
corresponding proportionate adjustment in the Option Price per share.
7.2 REORGANIZATION IN WHICH THE CORPORATION IS THE
SURVIVING ENTITY.
- 4 -
<PAGE> 7
Subject to Section 7.3 of this Section, if the Corporation
shall be the surviving entity in any reorganization, merger or consolidation of
the Corporation with one or more other entities, the Option shall pertain to
and apply to the securities to which a holder of the number of shares subject
to the Option would have been entitled immediately following such
reorganization, merger or consolidation, with a corresponding proportionate
adjustment of the Option Price per share so that the aggregate Option Price
thereafter shall be the same as the aggregate Option Price of the shares
remaining subject to the Option immediately prior to such reorganization,
merger or consolidation.
7.3 REORGANIZATION IN WHICH THE CORPORATION IS NOT THE
SURVIVING CORPORATION OR SALE OF ASSETS OR STOCK.
Upon the dissolution or liquidation of the Corporation, or
upon a merger, consolidation or reorganization of the Corporation with one or
more other entities in which the Corporation is not the surviving entity, or
upon a sale of all or substantially all of the assets of the Corporation to
another entity, or upon any transaction (including, without limitation, a
merger or reorganization in which the Corporation is the surviving entity)
approved by the Board which results in any person or entity (or persons or
entities acting as a group or otherwise in concert) owning fifty (50) percent
or more of the combined voting power of all classes of stock of the
Corporation, the Option hereunder shall terminate, except to the extent
provision is made in writing in connection with such transaction for the
continuation and/or the assumption of the Option, or for the substitution for
the Option of new options covering the stock of a successor corporation, or a
parent or subsidiary thereof, with appropriate adjustments as to the number and
kinds of shares of stock and exercise prices, in which event the Option shall
continue in the manner and under the terms so provided. In the event of any
such termination of the Option, the Optionee shall have the right (subject to
the limitations on exercise set forth in Section 3.4 above), for thirty (30)
days immediately prior to the occurrence of such termination, to exercise the
Option in whole or in part. The Corporation shall send written notice of an
event that will result in such a termination to the Optionee not later than the
time at which the Corporation gives notice thereof to its shareholders.
7.4 ADJUSTMENTS.
Adjustments specified in this Section relating to shares of
Stock or securities of the Corporation shall be made by the Board, whose
determination in that respect shall be final, binding and conclusive. No
fractional shares or units of other securities shall be issued pursuant to any
such adjustment, and any fractions resulting from any such adjustment shall be
eliminated in each case by rounding downward to the nearest whole share or
unit.
8. GENERAL RESTRICTIONS.
- 5 -
<PAGE> 8
The Corporation shall not be required to sell or issue any
shares of Stock under the Option if the sale or issuance of such shares would
constitute a violation by the individual exercising the Option or by the
Corporation of any provision of any law or regulation of any governmental
authority, including without limitation any federal or state securities laws or
regulations. If at any time the Corporation shall determine, in its
discretion, that the listing, registration or qualification of any shares of
Stock subject to the Option upon any securities exchange or under any state or
federal law, or the consent or approval of any government regulatory body, is
necessary or desirable as a condition of, or in connection with, the issuance
or purchase of shares hereunder, the Option may not be exercised in whole or in
part unless such listing, registration, qualification, consent or approval
shall have been effected or obtained free of any conditions not acceptable to
the Corporation, and any delay caused thereby shall in no way affect the date
of termination of the Option. Specifically in connection with the Securities
Act of 1933, upon notice of exercise of any Option, unless a registration
statement under such Act is in effect with respect to the shares covered by
such Option, the Corporation shall not be required to sell or issue such shares
unless the Board has received evidence satisfactory to the Board that the
holder of such Option may acquire such shares pursuant to an exemption from
registration under such Act. Any determination in this connection by the
Corporation shall be final, binding, and conclusive. The Corporation shall not
be obligated to take any affirmative action in order to cause the exercise of
the Option or the issuance of shares of Stock pursuant thereto to comply with
any law or regulation of any governmental authority. As to any jurisdiction
that expressly imposes the requirement that the Option shall not be exercisable
unless and until the shares covered by the Option are registered or are subject
to an available exemption from registration, the exercise of the Option (under
circumstances in which the laws of such jurisdiction apply) shall be deemed
conditioned upon the effectiveness of such registration or the availability of
such an exemption.
9. WITHHOLDING OF TAXES.
The parties hereto recognize that the Corporation may be
obligated to withhold federal and local income taxes and Social Security taxes
to the extent that the Optionee realizes ordinary income in connection with the
exercise of the Option. The Optionee agrees that the Corporation may withhold
amounts needed to cover such taxes from payments otherwise due and owing to the
Optionee, and also agrees that upon demand the Optionee will promptly pay to
the Corporation or a Subsidiary having such obligation any additional amounts
as may be necessary to satisfy such withholding tax obligation. To the extent
permissible under applicable tax, securities, and other laws, the Optionee may
satisfy a tax withholding requirement by directing the Corporation to apply
shares of Stock to which the Optionee is entitled as a result of the exercise
of the Option to satisfy withholding requirements.
- 6 -
<PAGE> 9
10. DISCLAIMER OF RIGHTS.
No provision in this Option Agreement shall be construed to
confer upon the Optionee the right to continue as a director of the
Corporation.
11. INTERPRETATION OF THIS OPTION AGREEMENT.
All decisions and interpretations made by the Board with
regard to any question arising under the Plan or this Option Agreement shall be
final, binding and conclusive on the
Corporation and the Optionee and any other person entitled to exercise the
Option as provided for herein. In the event that there is any inconsistency
between the provisions of this Option Agreement and of the Plan, the provisions
of the Plan shall govern.
12. GOVERNING LAW; JURISDICTION.
This Option Agreement shall be construed and interpreted in
accordance with the laws of the State of Maryland (excluding the choice of law
rules thereof).
13. DATE OF GRANT.
The date of grant of this Option is March 27, 1996.
14. BINDING EFFECT.
Subject to all restrictions provided for in this Option
Agreement and by applicable law relating to assignment and transfer of this
Option Agreement and the option provided for herein, this Option Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective heirs, executors, administrators, successors, and assigns.
15. NOTICE.
Any notice hereunder by the Optionee to the Corporation shall
be in writing and shall be deemed duly given if mailed or delivered to the
Corporation at its principal office, addressed to the attention of the
Corporate Secretary, or if so mailed or delivered to such other address as the
Corporation may hereafter designate by notice to the Optionee. Any notice
hereunder by the Corporation to the Optionee shall be in writing and shall be
deemed duly given
- 7 -
<PAGE> 10
if mailed or delivered to the Optionee at the address specified below by the
Optionee for such purpose, or if so mailed or delivered to such other address
as the Optionee may hereafter designate by written notice given to the
Corporation.
16. ENTIRE AGREEMENT.
This Option Agreement constitutes the entire agreement and
supersedes all prior understandings and agreements, written or oral, of the
parties hereto with respect to the subject matter hereof. Neither this Option
Agreement nor any term hereof may be amended, waived, discharged or terminated
except by a written instrument signed by the Corporation and the Optionee;
provided, however, that the Corporation unilaterally may waive any provision
hereof in writing to the extent that such waiver does not adversely affect the
interests of the Optionee hereunder, but no such waiver shall operate as or be
construed to be a subsequent waiver of the same provision or a waiver of any
other provision hereof.
IN WITNESS WHEREOF, the parties hereto have duly executed and
delivered this Option Agreement, or caused this Option Agreement to be duly
executed and delivered on their behalf, as of the day and year first above
written.
ATTEST: GUILFORD PHARMACEUTICALS INC.
/s/ Jordan P. Karp By: /s/ Thomas C. Seoh
- ------------------------- ---------------------------------------
Title: Vice President, General Counsel & Sec'y
---------------------------------------
OPTIONEE:
/s/ Richard L. Casey
---------------------------------------------
Richard L. Casey
ADDRESS FOR NOTICE TO
OPTIONEE:
- 8 -
<PAGE> 11
137 Bridgton Court
---------------------------------------------
Number Street
Los Altos, CA 94072
---------------------------------------------
City State Zip Code
- 9 -
<PAGE> 1
EXHIBIT 4.1e
GUILFORD PHARMACEUTICALS INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
<PAGE> 2
GUILFORD PHARMACEUTICALS INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
1. GRANT OF OPTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
---------------
2. PRICE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
-----
3. EXERCISE OF OPTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
------------------
3.1 TIME OF EXERCISE OF OPTION. . . . . . . . . . . . . . . . . . . . . . 1
--------------------------
3.2 EXERCISE BY OPTIONEE. . . . . . . . . . . . . . . . . . . . . . . . . 2
--------------------
3.3 TERMINATION OF OPTION. . . . . . . . . . . . . . . . . . . . . . . . . 2
---------------------
3.4 LIMITATIONS ON EXERCISE OF OPTION. . . . . . . . . . . . . . . . . . . 2
---------------------------------
3.5 REDUCTION IN NUMBER OF SHARES SUBJECT TO OPTION. . . . . . . . . . . . 3
-----------------------------------------------
4. METHOD OF EXERCISE OF OPTION. . . . . . . . . . . . . . . . . . . . . . . . . 3
----------------------------
5. LIMITATIONS ON TRANSFER. . . . . . . . . . . . . . . . . . . . . . . . . . . 3
-----------------------
6. RIGHTS AS STOCKHOLDER. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
---------------------
7. EFFECT OF CHANGES IN CAPITALIZATION. . . . . . . . . . . . . . . . . . . . . 4
-----------------------------------
7.1 CHANGES IN SHARES. . . . . . . . . . . . . . . . . . . . . . . . . . . 4
-----------------
7.2 REORGANIZATION IN WHICH THE CORPORATION
---------------------------------------
IS THE SURVIVING ENTITY. . . . . . . . . . . . . . . . . . . . . . . . 4
-----------------------
7.3 REORGANIZATION IN WHICH THE CORPORATION
---------------------------------------
IS NOT THE SURVIVING CORPORATION OR SALE
----------------------------------------
OF ASSETS OR STOCK. . . . . . . . . . . . . . . . . . . . . . . . . . 4
------------------
7.4 ADJUSTMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
-----------
8. GENERAL RESTRICTIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
--------------------
9. WITHHOLDING OF TAXES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
--------------------
10. DISCLAIMER OF RIGHTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
--------------------
11. INTERPRETATION OF THIS OPTION AGREEMENT. . . . . . . . . . . . . . . . . . . 6
---------------------------------------
12. GOVERNING LAW; JURISDICTION. . . . . . . . . . . . . . . . . . . . . . . . . 7
---------------------------
13. DATE OF GRANT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
-------------
14. BINDING EFFECT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
--------------
15. NOTICE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
------
16. ENTIRE AGREEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
----------------
</TABLE>
<PAGE> 3
GUILFORD PHARMACEUTICALS INC.
NON-QUALIFIED STOCK OPTION PLAN
STOCK OPTION AGREEMENT
This Stock Option Agreement (the "Option Agreement") is made
as of the 27th day of March, 1996, by and between Guilford Pharmaceuticals Inc.
(the "Corporation") and John H. Newman, a non-employee director of the
Corporation (the "Optionee").
NOW, THEREFORE, in consideration of the mutual promises and
covenants contained herein, the parties hereto do hereby agree as follows:
1. GRANT OF OPTION.
Subject to the approval of the Corporation's stockholders, the
Corporation hereby grants to the Optionee the right and option (the "Option")
to purchase from the Corporation, on the terms and subject to the conditions
hereinafter set forth, 30,000 shares of common stock, par value $.01 per share,
of the Corporation ("Stock"). This Option shall not constitute an incentive
stock option within the meaning of section 422 of the Internal Revenue Code of
1986, as amended (the "Code").
2. PRICE.
The purchase price (the "Option Price") for the shares of
Stock subject to the Option granted by this Option Agreement is $20.3125 per
share (the fair market value of the Stock).
3. EXERCISE OF OPTION.
Except as otherwise provided herein, the Option granted
pursuant to this Option Agreement shall be subject to exercise as follows:
3.1 TIME OF EXERCISE OF OPTION.
The Option shall become exercisable in full six months after
the date of grant (but shall not be exercisable before approval of the Plan by
the stockholders of the Corporation). The Option shall be exercisable, in
whole or in part, at any time and from time to time, after becoming exercisable
and prior to termination of the Option; provided, that no single exercise of an
Option shall be for less than 100 shares or the maximum number of shares
available for purchase under the Option at the time of exercise, if less.
<PAGE> 4
3.2 EXERCISE BY OPTIONEE.
During the lifetime of the Optionee, only the Optionee (or, in
the event of the Optionee's legal incapacity or incompetency, the Optionee's
guardian or legal representative) may exercise the Option.
3.3 TERMINATION OF OPTION.
The Option shall terminate ten (10) years after the date of
grant of the Option, as set forth in Section 13 below. Optionee's termination
of Board service shall not terminate the Option which shall continue in force
for the duration of its term; provided, however, in the event of Optionee's
death, the Option shall become fully exercisable and shall continue in force
for one year following the date of death.
3.4 LIMITATIONS ON EXERCISE OF OPTION.
Notwithstanding the foregoing Subsections of this Section, in
no event may the Option be exercised, in whole or in part, after the earlier of
(i) ten (10) years following the date upon which the Option is granted, as set
forth in Section 13 below or (ii) the occurrence of an event referred to in
Section 7 below which results in termination of the Option. In no event may
the Option be exercised for a fractional Share.
3.5 REDUCTION IN NUMBER OF SHARES SUBJECT TO OPTION.
The number of shares which may be purchased upon exercise of
the Option pursuant to this Section shall be reduced by the number of shares
previously purchased upon exercise of the Option pursuant to this Section.
4. METHOD OF EXERCISE OF OPTION.
Subject to the terms and conditions of this Option Agreement,
an Optionee may, at any time, exercise an Option with respect to all or any
part of the shares of Stock then subject to such Option by giving the
Corporation written notice of exercise, specifying the number of shares as to
which the Option is being exercised. Such notice shall be addressed to the
Secretary of the Corporation at the Corporation's principal office, and shall
be effective when actually received (by personal delivery, fax or other
delivery) by the Secretary of the Corporation. Such notice shall be
accompanied by an amount equal to the Exercise Price of such shares, in the
form of any one or combination of the following: (i) cash or cash equivalents,
(ii) shares of Stock valued at fair market value in accordance with the Plan,
(iii) by the delivery of a promissory note
<PAGE> 5
of the person exercising the Option to the Corporation bearing interest at one
(1) percent above the average interest rate paid by the Corporation on
Corporation indebtedness on the date of exercise and repayable in equal annual
installments over no more than five (5) years; or (iv) by causing the
Corporation to withhold shares of Stock otherwise issuable pursuant to the
exercise of an Option equal in value to the Option Price or portion thereof to
be satisfied pursuant to this clause (iv). Shares of Stock acquired by the
Optionee through exercise of an Option may be surrendered in payment of the
Exercise Price of Options; provided, however, that any Stock surrendered in
payment must have been (a) held by the Optionee for more than six months at the
time of surrender or (b) acquired under an Option granted not less than six
months prior to the time of surrender. Payment in full of the Exercise Price
need not accompany the written notice of exercise provided the notice directs
that the Stock certificate or certificates for the shares for which the Option
is exercised be delivered to a licensed broker acceptable to the Corporation as
the agent for the individual exercising the Option and, at the time such Stock
certificate or certificates are delivered, the broker tenders to the
Corporation cash (or cash equivalents acceptable to the Corporation) equal to
the Exercise Price. For purposes of this Option Agreement, "fair market
value" means the value of each share of Stock subject to this Option determined
as follows: If on the date of grant or other determination date the Stock is
listed on an established national or regional stock exchange, is admitted to
quotation on the National Association of Securities Dealers Automated Quotation
System, or is publicly traded on an established securities market, the fair
market value of the Stock shall be the closing price of the Stock on such
exchange or in such market (the highest such closing price if there is more
than one such exchange or market) on the trading day immediately preceding the
date of grant or other determination date (or, is there is no such reported
closing price, the fair market value shall be the mean between the highest bid
and lowest asked prices or between the high and low sale prices on such trading
day), or, if no sale of the Stock is reported for such trading day, on the next
preceding day on which any sale shall have been reported. If the Stock is not
listed on such an exchange, quoted on such System or traded on such a market,
fair market value shall be determined by the Corporation's board of directors
(the "Board"). "Exercise Price" means the Option Price multiplied by the
number of shares of Stock purchased pursuant to exercise of an Option.
5. LIMITATIONS ON TRANSFER.
The Option is not transferable by the Optionee, other than by
will or the laws of descent and distribution in the event of death of the
Optionee and shall not be pledged or hypothecated (by operation of law or
otherwise) or subject to execution, attachment or similar processes.
6. RIGHTS AS STOCKHOLDER.
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<PAGE> 6
Neither the Optionee nor any executor, administrator,
distributee or legatee of the Optionee's estate shall be, or have any of the
rights or privileges of, a stockholder of the Corporation in respect of any
shares transferable hereunder unless and until such shares have been fully paid
and certificates representing such shares have been endorsed, transferred and
delivered, and the name of the Optionee (or of such personal representative,
administrator, distributee or legatee of the Optionee's estate) has been
entered as the stockholder of record on the books of the Corporation.
7. EFFECT OF CHANGES IN CAPITALIZATION.
7.1 CHANGES IN SHARES.
If the number of outstanding shares of Stock is increased or
decreased or changed into or exchanged for a different number or kind of stock
or other securities of the Corporation by reason of any recapitalization,
reclassification, Stock split, reverse split, combination of Stock, exchange of
Stock, Stock dividend or other distribution payable in capital stock, or other
increase or decrease in such shares effected without receipt of consideration
by the Corporation occurring after the date the Option is granted, a
proportionate and appropriate adjustment shall be made by the Corporation in
the number and kind of shares subject to the Option, so that the proportionate
interest of the Optionee immediately following such event shall, to the extent
practicable, be the same as immediately prior to such event. Any such
adjustment in the Option shall not change the total Option Price with respect
to shares subject to the unexercised portion of the Option but shall include a
corresponding proportionate adjustment in the Option Price per share.
7.2 REORGANIZATION IN WHICH THE CORPORATION IS THE SURVIVING
ENTITY.
Subject to Section 7.3 of this Section, if the Corporation
shall be the surviving entity in any reorganization, merger or consolidation of
the Corporation with one or more other entities, the Option shall pertain to
and apply to the securities to which a holder of the number of shares subject
to the Option would have been entitled immediately following such
reorganization, merger or consolidation, with a corresponding proportionate
adjustment of the Option Price per share so that the aggregate Option Price
thereafter shall be the same as the aggregate Option Price of the shares
remaining subject to the Option immediately prior to such reorganization,
merger or consolidation.
7.3 REORGANIZATION IN WHICH THE CORPORATION IS NOT THE
SURVIVING CORPORATION OR SALE OF ASSETS OR STOCK.
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<PAGE> 7
Upon the dissolution or liquidation of the Corporation, or
upon a merger, consolidation or reorganization of the Corporation with one or
more other entities in which the Corporation is not the surviving entity, or
upon a sale of all or substantially all of the assets of the Corporation to
another entity, or upon any transaction (including, without limitation, a
merger or reorganization in which the Corporation is the surviving entity)
approved by the Board which results in any person or entity (or persons or
entities acting as a group or otherwise in concert) owning fifty (50) percent
or more of the combined voting power of all classes of stock of the
Corporation, the Option hereunder shall terminate, except to the extent
provision is made in writing in connection with such transaction for the
continuation and/or the assumption of the Option, or for the substitution for
the Option of new options covering the stock of a successor corporation, or a
parent or subsidiary thereof, with appropriate adjustments as to the number and
kinds of shares of stock and exercise prices, in which event the Option shall
continue in the manner and under the terms so provided. In the event of any
such termination of the Option, the Optionee shall have the right (subject to
the limitations on exercise set forth in Section 3.4 above), for thirty (30)
days immediately prior to the occurrence of such termination, to exercise the
Option in whole or in part. The Corporation shall send written notice of an
event that will result in such a termination to the Optionee not later than the
time at which the Corporation gives notice thereof to its shareholders.
7.4 ADJUSTMENTS.
Adjustments specified in this Section relating to shares of
Stock or securities of the Corporation shall be made by the Board, whose
determination in that respect shall be final, binding and conclusive. No
fractional shares or units of other securities shall be issued pursuant to any
such adjustment, and any fractions resulting from any such adjustment shall be
eliminated in each case by rounding downward to the nearest whole share or
unit.
8. GENERAL RESTRICTIONS.
The Corporation shall not be required to sell or issue any
shares of Stock under the Option if the sale or issuance of such shares would
constitute a violation by the individual exercising the Option or by the
Corporation of any provision of any law or regulation of any governmental
authority, including without limitation any federal or state securities laws or
regulations. If at any time the Corporation shall determine, in its
discretion, that the listing, registration or qualification of any shares of
Stock subject to the Option upon any securities exchange or under any state or
federal law, or the consent or approval of any government regulatory body, is
necessary or desirable as a condition of, or in connection with, the issuance
or purchase of shares hereunder, the Option may not be exercised in whole or in
part unless such listing, registration, qualification, consent or approval
shall have been effected or obtained free of any conditions not acceptable to
the Corporation, and any delay caused thereby shall in no way
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<PAGE> 8
affect the date of termination of the Option. Specifically in connection with
the Securities Act of 1933, upon notice of exercise of any Option, unless a
registration statement under such Act is in effect with respect to the shares
covered by such Option, the Corporation shall not be required to sell or issue
such shares unless the Board has received evidence satisfactory to the Board
that the holder of such Option may acquire such shares pursuant to an exemption
from registration under such Act. Any determination in this connection by the
Corporation shall be final, binding, and conclusive. The Corporation shall not
be obligated to take any affirmative action in order to cause the exercise of
the Option or the issuance of shares of Stock pursuant thereto to comply with
any law or regulation of any governmental authority. As to any jurisdiction
that expressly imposes the requirement that the Option shall not be exercisable
unless and until the shares covered by the Option are registered or are subject
to an available exemption from registration, the exercise of the Option (under
circumstances in which the laws of such jurisdiction apply) shall be deemed
conditioned upon the effectiveness of such registration or the availability of
such an exemption.
9. WITHHOLDING OF TAXES.
The parties hereto recognize that the Corporation may be
obligated to withhold federal and local income taxes and Social Security taxes
to the extent that the Optionee realizes ordinary income in connection with the
exercise of the Option. The Optionee agrees that the Corporation may withhold
amounts needed to cover such taxes from payments otherwise due and owing to the
Optionee, and also agrees that upon demand the Optionee will promptly pay to
the Corporation or a Subsidiary having such obligation any additional amounts
as may be necessary to satisfy such withholding tax obligation. To the extent
permissible under applicable tax, securities, and other laws, the Optionee may
satisfy a tax withholding requirement by directing the Corporation to apply
shares of Stock to which the Optionee is entitled as a result of the exercise
of the Option to satisfy withholding requirements.
10. DISCLAIMER OF RIGHTS.
No provision in this Option Agreement shall be construed to
confer upon the Optionee the right to continue as a director of the
Corporation.
11. INTERPRETATION OF THIS OPTION AGREEMENT.
All decisions and interpretations made by the Board with
regard to any question arising under the Plan or this Option Agreement shall be
final, binding and conclusive on the
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<PAGE> 9
Corporation and the Optionee and any other person entitled to exercise the
Option as provided for herein. In the event that there is any inconsistency
between the provisions of this Option Agreement and of the Plan, the provisions
of the Plan shall govern.
12. GOVERNING LAW; JURISDICTION.
This Option Agreement shall be construed and interpreted in
accordance with the laws of the State of Maryland (excluding the choice of law
rules thereof).
13. DATE OF GRANT.
The date of grant of this Option is March 27, 1996.
14. BINDING EFFECT.
Subject to all restrictions provided for in this Option
Agreement and by applicable law relating to assignment and transfer of this
Option Agreement and the option provided for herein, this Option Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective heirs, executors, administrators, successors, and assigns.
15. NOTICE.
Any notice hereunder by the Optionee to the Corporation shall
be in writing and shall be deemed duly given if mailed or delivered to the
Corporation at its principal office, addressed to the attention of the
Corporate Secretary, or if so mailed or delivered to such other address as the
Corporation may hereafter designate by notice to the Optionee. Any notice
hereunder by the Corporation to the Optionee shall be in writing and shall be
deemed duly given if mailed or delivered to the Optionee at the address
specified below by the Optionee for such purpose, or if so mailed or delivered
to such other address as the Optionee may hereafter designate by written notice
given to the Corporation.
16. ENTIRE AGREEMENT.
This Option Agreement constitutes the entire agreement and
supersedes all prior understandings and agreements, written or oral, of the
parties hereto with respect to the subject matter hereof. Neither this Option
Agreement nor any term hereof may be amended, waived,
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<PAGE> 10
discharged or terminated except by a written instrument signed by the
Corporation and the Optionee; provided, however, that the Corporation
unilaterally may waive any provision hereof in writing to the extent that such
waiver does not adversely affect the interests of the Optionee hereunder, but
no such waiver shall operate as or be construed to be a subsequent waiver of
the same provision or a waiver of any other provision hereof.
IN WITNESS WHEREOF, the parties hereto have duly executed and
delivered this Option Agreement, or caused this Option Agreement to be duly
executed and delivered on their behalf, as of the day and year first above
written.
ATTEST: GUILFORD PHARMACEUTICALS INC.
/s/ Jordan P. Karp By: /s/ Thomas C. Seoh
- ----------------------- -------------------------------------------
Title: VP, General Counsel & Secy
---------------------------------------
OPTIONEE:
/s/ John H. Newman
----------------------------------------------
John H. Newman
ADDRESS FOR NOTICE TO
OPTIONEE:
312 Devonshire Blvd.
----------------------------------------------
Number Street
San Carlos, CA 94070
----------------------------------------------
City State Zip Code
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<PAGE> 1
EXHIBIT 4.1f
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT is made as of April 18, 1996 (the
"Effective Date"), by and between Guilford Pharmaceuticals Inc., a Delaware
corporation, with its principal offices at 6611 Tributary Street, Baltimore,
Maryland 21224 (the "Company"), and Henry H. Brem, M.D., of 11201 Five
Springs Road, Lutherville, Maryland 21093 (the "Consultant").
WHEREAS, the Company desires to engage the Consultant, and the
Consultant desires to be engaged by the Company, pursuant to the terms
contained in this Agreement;
NOW THEREFORE, in consideration of the mutual promises of the
parties hereunder, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Company and the
Consultant hereby agree as follows:
1. Services. The Company hereby retains the Consultant to
perform, and the Consultant hereby agrees to render to the Company, consulting
and advisory services as requested from time to time by the Company (the
"Services"). Such Services may include, but shall not be limited to, the
following: serving on any advisory board in the area of targeted controlled
delivery of drugs in biodegradable polymers, helping to identify and recruit
candidates and business prospects helpful to the business of the Company,
advising and assisting the Company in connection with the acquisition and/or
development of new technologies and advising regarding the development of
potentially competitive products and participating in such meetings pertaining
to the business of the Company as the Company may from time to time reasonably
request. The Consultant agrees to use reasonable efforts to perform the
Services and to make himself available to render the Services for up to 38 days
per year, at the Company's discretion, at times which are mutually acceptable,
during the term of this Agreement.
2. Consulting Fees.
(a) As complete consideration for the performance of the
Services by the Consultant under this Agreement, the Company agrees, subject to
the terms of this Agreement, to pay the Consultant a cash retainer and issue
stock options as provided in this Section 2.
(b) The Company agrees to pay the Consultant a cash retainer,
payable monthly in arrears within 10 days of the end of each month during the
term of the Agreement, as follows:
(i) $115,000 per annum ($9,583.33 per month) for the
first year of this Agreement;
(ii) $125,000 per annum ($10,416.66 per month) for the
second year of this Agreement;
<PAGE> 2
(iii) $135,000 per annum ($11,250 per month) for the third
year of this Agreement; and
(iv) $145,000 per annum ($12,083.33 per month) for the
fourth year of this Agreement.
(c) The Company hereby issues to the Consultant stock options
covering the Company's common stock as follows:
(i) Subject to Section 2(e) and (f) below, 50,000
non-qualified stock options issued as of the
Effective Date, valid for 10 years from issuance, at
an exercise price of $10.00 per share, vesting 40% on
December 15, 1996 and the remaining 60% on the first
anniversary of the Effective Date, provided the
Consultant has continuously served in a consulting
capacity with the Company as of the applicable
vesting date.
(ii) Subject to Section 2(e) below, 50,000 non-qualified
stock options issued as of the Effective Date, valid
for 10 years from issuance, at an exercise price of
the closing price per share on the last trading day
prior to the Effective Date (the "Exercise Price"),
vesting 16,666 options on the second anniversary of
the Effective Date, 16,667 options on the third
anniversary of the Effective Date, and 16,667 options
on the fourth anniversary of the Effective Date,
provided the Consultant has continuously served in a
consulting capacity with the Company as of the
applicable vesting date (or in the case of the
options vesting on the fourth anniversary of the
Effective Date, through the term of this Agreement).
(iii) Subject to Section 2(d), (e) and (f) below, 50,000
non-qualified stock options issued as of the
Effective Date, valid for 10 years from issuance, at
the Exercise Price, vesting 119 months following the
Effective Date, provided the Consultant has
continuously served in a consulting capacity with the
Company as of the vesting date, but subject to
accelerated vesting as follows:
(A) 15,000 options vesting 30 days following
receipt by the Company in the aggregate
cumulative sum of at least $5 million for the
development by the Company of a "New Polymer
Product" (i.e., a product in the Field, as
defined in Section 4(a) below, other than
"GLIADEL", i.e., PCPP:SA with 3.85% BCNU)
pursuant to one or more strategic alliance,
research and development or similar
transaction(s) between the Company and one or
more third party companies;
<PAGE> 3
(B) 10,000 options vesting 30 days following
receipt by the Company of a cumulative
aggregate sum of at least $3 million for the
development of products in the Field from new
external sources other than those
contemplated in (A) above (e.g., from
government agencies or foundations);
(C) 5,000 options vesting 30 days following
execution of the first license agreement, if
any, between the Company and the
Massachusetts Institute of Technology ("MIT")
and/or The Johns Hopkins University ("JHU")
pursuant to which the Company (in its
absolute discretion) licenses any new polymer
composition or use patent(s) (other than the
patent applications listed in the License
Agreement between Guilford and MIT and JHU
contemplated in Section 2(e) below) invented
by the Consultant and/or his collaborator,
Robert S. Langer, Ph.D. of MIT;
(D) 10,000 options vesting 30 days following the
filing by the Company of an Investigational
New Drug for a New Polymer Product containing
a drug other than BCNU;
(E) 10,000 options vesting 30 days following
enrollment of the first patient in a Phase
III Clinical Trial sponsored by the Company
for a New Polymer Product containing a drug
other than BCNU;
(F) 10,000 options vesting 30 days following
submission by the Company of a New Drug
Application for a New Polymer Product; and/or
(G) 10,000 options vesting 30 days following the
closing of a public or private equity
offering (but not including any issuance of
equity to any corporate partner for GLIADEL)
during the term of the Agreement pursuant to
which the Company has raised at least
$10,000,000;
provided that notwithstanding the occurrence of some or all of the
events listed in (A) through (G) above, nothing shall obligate the
Company to issue or vest in excess of 50,000 stock options pursuant to
this Section 2(c)(iii).
(d) Provided that the Consultant was not terminated for cause
(as defined below), or Consultant did not voluntarily terminate the Agreement,
or the Agreement did not terminate due to the death or disability of
Consultant, the provisions of each of Section 2(c)(iii)(A), (B) and (E) shall
survive any termination or expiration of the Agreement for a period of two (2)
years,
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<PAGE> 4
and the provisions of Section 2(c)(iii)(F) shall survive any termination or
expiration of the Agreement until the end of the 119th month following the
Effective Date.
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<PAGE> 5
(e) The stock options described in Section 2(c)(i), (ii) and
(iii) above shall accelerate and vest upon the effective date of a merger where
the Company is not the surviving entity or a disposition of substantially all
of the assets of the Company. In the event of death of Consultant, the legal
representative of the estate or heir will have up to a year thereafter to
exercise vested stock options, but unvested stock options will cease to vest
upon Consultant's death.
(f) The stock options described in Section 2(c)(i) and (iii)
above shall be subject to the condition subsequent that the Company enters into
a License Agreement with MIT and JHU in form and content acceptable to the
Company, MIT and JHU, with respect to the invention of Consultant and Henry
Brem, M.D., entitled "Controlled Local Delivery of Chemotherapeutic Agents for
Treating Solid Tumors" (MIT case no. 6651) and related domestic and foreign
filings as may be set forth in any such License Agreement prior to December 15,
1996.
(g) All tax consequences of fees and other consideration
under this Agreement shall be the responsibility of the Consultant.
(h) The parties hereto agree that the Consultant shall
receive no other compensation (other than reimbursement of reasonable expenses)
for the Consultant's service on behalf of the Company, whether on any advisory
board or otherwise.
3. Term. The term of this Agreement shall commence on the
Effective Date and shall continue for a term of four (4) years, unless further
extended or renewed by mutual agreement of the parties hereto, or unless
earlier terminated as hereinafter provided. This Agreement may be terminated
as follows:
(a) automatically upon the death of the Consultant;
(b) by the Company, if, due to the illness or disability of
the Consultant, the Consultant is unable to perform his obligations under this
Agreement for a period in excess of three (3) consecutive months or 120 days
out of any 12 month period;
(c) by the Company on written notice "for cause"; "for cause"
as used in this Agreement shall mean (i) the failure or refusal on the part of
the Consultant to timely perform his duties under this Agreement; (ii) a
material breach by the Consultant of any other provision of this Agreement;
(iii) the commission by the Consultant of a fraudulent or dishonest act in the
Consultant's relations with the Company; (iv) the conviction of the Consultant
for any crime involving a felony, fraud, embezzlement or the like or an act of
moral turpitude; or (v) other willful, reckless or negligent misconduct or
similar action on the part of the Consultant that is materially damaging or
detrimental to the Company.
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<PAGE> 6
4. Exclusivity and Non-Competition.
(a) The Consultant will consult exclusively for the Company
(except with respect to specific matters with the Company's prior consent), and
will not accept employment from or consult for any other commercial entities,
in the area of targeted controlled delivery of chemotherapeutics, biologicals
and/or other agents for the treatment of cancer (the "Field"). For the
avoidance of doubt: (i) the parties acknowledge that the Consultant has been
and is performing investigations and consulting in the area of antiangiogenesis
for the treatment of cancer, and agree that such investigations and consulting
can continue except that the targeted controlled delivery of such agents for
the treatment of cancer shall be included within the Field as used in this
Agreement; (ii) "targeted" means directing delivery of the product (whether the
active drug, the product or any other component of the product) by design to
the site of the cancer (whether locally placed at the site, introduced
systemically or otherwise); "controlled" means release of the active drug by
design in a polymer vehicle, which vehicle releases the drug over some
non-trivial period of time at the site of the cancer; for a product to be
considered in the Field, it must be both targeted and controlled, and not just
one or the other; (iii) this Section 4(a) will not preclude the Consultant from
engaging in academic research, so long as the Consultant is not consulting
(whether as a consultant or an employee) in the Field for a commercial entity;
and (iv) the Field is intended to encompass therapeutics, not diagnostics or
imaging agents.
(b) The Consultant will disclose in writing to the Company,
in the person of the Chief Executive Officer and the General Counsel of the
Company, prior to the commencement of this Agreement and on every anniversary
during the term of this Agreement (as the same may be extended or renewed), the
Consultant's membership on scientific advisory boards, boards of directors and
similar bodies and commercial entities with which he has a consulting or
employment relationship or an ownership interest of more than 1% of any equity
in a public or private company (in which event such percentage ownership will
be disclosed), which information such disclosees shall keep confidential for a
period of five (5) years from disclosure, provided that such obligation of
confidence shall not apply to information (i) which was at the time of
disclosure or subsequent thereto comes into the public domain through no fault
of the Company, or (ii) which the Company had in its possession at the time of
disclosure by the Consultant, or (iii) which the Company receives in good faith
from a third party who is not, to the Company's knowledge in good faith, under
an obligation of confidentiality to the Consultant with respect to the
information in question, or (iv) which the Company is required to disclose by
law (the contingencies in (i) through (iv) above, "Standard Exceptions to
Confidentiality"), provided that nothing herein shall limit such disclosees
from disclosing such information as they may deem necessary or desirable in the
event of a dispute regarding whether or not this exclusivity provision has been
breached by the Consultant. The Company will use its commercially reasonable
best efforts to destroy the Consultant's written disclosures of memberships and
consultancies no later than five (5) years following disclosure thereof
hereunder.
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<PAGE> 7
(c) In the event of any early termination of this Agreement
by the Consultant prior to the expiration of the four year term set forth in
Section 3 above (or any mutually agreed extension or renewal thereof), the
Consultant agrees that he will not, for a period of one year thereafter, accept
employment from or consult for any other commercial entities in the Field,
provided that this Section 4(c) will not preclude the Consultant from engaging
in academic research.
(d) The Consultant represents and warrants to the Company
that the Consultant is, as of and including the date hereof, under no
contractual or other restriction or obligation, including agreements or
understandings with other parties, which conflicts with this Agreement, the
performance of his duties hereunder or the other obligations of the Consultant
to the Company. The Consultant hereby represents and warrants that he has no
present plans to terminate his present full-time employment with JHU or some
other comparable academic institution to join any commercial enterprise or
engage in other business or private practice.
(e) Nothing in this Agreement shall be deemed to limit the
Company from engaging other consultants or employees in the Field or otherwise.
5. Independent Contractor Relationship. It is understood and
agreed that the Consultant's relationship with the Company is that of an
independent contractor and that neither this Agreement nor the Services to be
rendered hereunder shall for any purpose whatsoever or in any way or manner
create any employer-employee relationship between the parties.
6. Assignments; Inventions. The Consultant hereby agrees to
use his best efforts without further compensation to assign or to have assigned
to the Company all of his right, title and interest in and to, any and all
inventions, processes, systems, improvements, modifications, secrets, designs
or discoveries, whether or not made, possessed, discovered or conceived by him,
individually or jointly with any other person or persons, whether made in or
out of working hours, free and clear of all liens, charges and encumbrances,
created or conceived by him during the term of this Agreement and patented or
reduced to practice within one year thereafter, which relate to the business of
the Company and which are not owned by The Johns Hopkins University pursuant to
the Johns Hopkins School of Medicine Intellectual Property Guidelines (dated
January 1, 1995), a copy of which is attached hereto as Exhibit 1 and
incorporated herein by reference (collectively, the "Inventions").
7. Disclosure of Inventions. The Consultant agrees to
promptly disclose Inventions to the Company. With respect to the Inventions,
the Consultant will, either during the term of or after the expiration or
termination of this Agreement for any reason, at the request and at the sole
cost of the Company, sign, execute, make and do all such deeds, documents, acts
and things as the Company and its duly authorized agents may reasonably
require, and further agrees to:
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<PAGE> 8
(i) apply for, obtain and vest in the name of the Company
alone (unless the Company otherwise directs) letters
patent or other invention protection in any country
throughout the world and when so obtained or vested
to extend, renew and restore the same;
(ii) defend any opposition proceedings in respect of such
applications and any opposition proceedings or
petitions or applications for revocation of such
letters, patents or other analogous protection; and
(iii) perform any other lawful acts which the Company may
reasonably request to carry out the purpose of this
Agreement.
8. Confidentiality.
(a) The Consultant agrees that he will not at any time
publish, reveal, sell, make accessible, give away or disclose to others or use
for his own benefit or except for the benefit of the Company, any research,
development, engineering and manufacturing data, plans, designs, formula,
processes, specifications, techniques, trade secrets, financial information,
customer or supplier lists or other information which are, or pursuant to the
terms hereof become, the property or confidential information of the Company or
any of its clients, customers, consultants, licensees or affiliates, or which
are acquired by him directly as a result of his acting as consultant to the
Company, except to such extent as may be required by law. The Consultant
agrees that he will not make any notes or memoranda relating to any matter that
is a art of the trade, activities or business of the Company or concerning any
of its dealings otherwise than for the benefit of the Company. The Consultant
shall at the Company's request return or destroy all tangible embodiments of
such confidential information prior to or at the termination of this Agreement.
(b) The parties agree to keep the fact and all terms of this
Agreement strictly confidential except: (i) in case of any Standard Exceptions
to Confidentiality; (ii) to the extent the Company deems disclosure necessary
or desirable under its public reporting obligations under securities laws;
(iii) to the extent mutually agreed by the parties hereto; and (iv) to the
extent the Consultant needs to disclose same to MIT pursuant to any obligation
to clear this Agreement with MIT, provided that Consultant will request
confidential treatment to be afforded same to the greatest extent possible.
9. Publication of Company Information. Subject to Section 8
above, the Consultant may publish information relating to the Field if in each
instance the Consultant provides Company thirty (30) days for review and
comment upon the manuscript or other material for such publication. Expedited
reviews for abstracts or poster presentations may be arranged if mutually
agreeable to the Consultant and the Company. In addition, if requested in
writing by the Company, the Consultant will withhold such publication an
additional sixty (60)
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<PAGE> 9
days to allow for filing a patent application or taking such other measures as
the Company deems appropriate to establish and preserve available proprietary
rights.
10. Breach of Agreement. The Consultant and the Company
agree that any material breach of this Agreement by either of them could cause
irreparable damage to the other party, and that in the event of such material
breach, in addition to any other remedies hereinbefore mentioned, the
non-breaching party shall have the right to obtain injunctive relief,
including, without limitation, specific performance or other equitable relief
to prevent the violation of the breaching party's obligations hereunder. It is
expressly understood and agreed that nothing herein contained shall be
construed as prohibiting the non-breaching party from pursuing any other
remedies available for such material breach including, without limitation, the
recovery of damages by the non-breaching party.
11. Assignment; Binding Effect. The Services to be rendered
by the Consultant are personal in nature. The Consultant may not assign or
transfer this Agreement or any of his rights or obligations hereunder. In no
event shall the Consultant assign or delegate responsibility for actual
performance or Services or any other obligations hereunder. Subject to the
foregoing, this Agreement shall be binding upon and inure to the benefit of the
parties and their respective legal representatives, successors and assigns.
12. Notices. All notices and other communications hereunder
shall be delivered or sent by registered or certified mail or by a major
recognized express courier service (such as Federal Express), return receipt
requested, addressed to the Company at 6611 Tributary Street, Baltimore,
Maryland 21224, Attn.: Dr. Craig R. Smith, or to the Consultant at the address
set forth above, or to such other address as either party may designate in
writing to the other.
13. Entire Agreement. This Agreement constitutes the entire
agreement between the parties as to the subject matter hereof and supersedes
and terminates as of this date any prior agreements between the parties for the
Services engaged hereunder. No provision of this Agreement shall be waived,
altered or canceled except in writing signed by the party against whom such
waiver, alteration or cancellation is asserted. Any such waiver shall be
limited to the particular instance and time and shall not constitute a waiver
of any subsequent instance without a specific waiver in writing by the party
against whom such waiver is sought to be enforced.
14. Counterpart. This Agreement may be executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
15. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Maryland, without giving
effect to conflict of laws.
16. Severability. In the event that any term of this
Agreement is held to be invalid, illegal, or unenforceable, such invalidity,
illegality, or unenforceability shall not affect any other portion of this
Agreement, and there shall be deemed substituted therefor such term as
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<PAGE> 10
will most fully realize the intent of the parties as expressed in this
Agreement to the fullest extent permitted by applicable law, the parties hereby
declaring their intent that this Agreement be construed in such fashion as to
maintain its existence, validity, and enforceability to the greatest extent
possible.
17. Johns Hopkins University Not A Party. The parties
acknowledge that The Johns Hopkins University, the Consultant's employer as of
the date hereof, is not a party to this Agreement, which is a private contract
between the Consultant and the Company. Notwithstanding the foregoing, the
parties agree as follows: with the limited exception of citing Consultant's
faculty title and institutional affiliation, the Company and its affiliates
will not use the names, likenesses, or logos of the Johns Hopkins University,
any of its Schools or Divisions, or the Johns Hopkins Hospital and Health
System in any of their fundraising or investment documents, general
publications, advertisements, or marketing and promotional materials without
the prior written permission of the Johns Hopkins University. A request for
such permission must be submitted by the Consultant to the School of Medicine's
Conflict of Interest Review Coordinator, who in appropriate circumstances, will
have it reviewed by the School of Medicine's Office of Public Affairs.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date and year first above written.
GUILFORD PHARMACEUTICALS INC.
By: /s/ Craig R. Smith, M.D. /s/ Henry H. Brem, M.D.
----------------------------------------- -----------------------
Name: Craig R. Smith, M.D. Henry H. Brem, M.D.
Title: President and Chief Executive Officer
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<PAGE> 11
Exhibit 1: Johns Hopkins School of Medicine Intellectual Property Guidelines
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<PAGE> 1
EXHIBIT 4.1g
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT is made as of April 18, 1996 (the
"Effective Date"), by and between Guilford Pharmaceuticals Inc., a Delaware
corporation, with its principal offices at 6611 Tributary Street, Baltimore,
Maryland 21224 (the "Company"), and Robert S. Langer, Ph.D., of 77 Lombard
Street, Newton, Massachusetts 02158 (the "Consultant").
WHEREAS, the Company desires to engage the Consultant, and the
Consultant desires to be engaged by the Company, pursuant to the terms
contained in this Agreement;
NOW THEREFORE, in consideration of the mutual promises of the
parties hereunder, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Company and the
Consultant hereby agree as follows:
1. Services. The Company hereby retains the Consultant to
perform, and the Consultant hereby agrees to render to the Company, consulting
and advisory services as requested from time to time by the Company (the
"Services"). Such Services may include, but shall not be limited to, the
following: serving on any advisory board in the area of targeted controlled
delivery of drugs in biodegradable polymers, helping to identify and recruit
candidates and business prospects helpful to the business of the Company,
advising and assisting the Company in connection with the acquisition and/or
development of new technologies and advising regarding the development of
potentially competitive products and participating in such meetings pertaining
to the business of the Company as the Company may from time to time reasonably
request. The Consultant agrees to use reasonable efforts to perform the
Services and to make himself available to render the Services for up to 38 days
per year, at the Company's discretion, at times which are mutually acceptable,
during the term of this Agreement.
2. Consulting Fees.
(a) As complete consideration for the performance of the
Services by the Consultant under this Agreement, the Company agrees, subject to
the terms of this Agreement, to pay the Consultant a cash retainer and issue
stock options as provided in this Section 2.
(b) The Company agrees to pay the Consultant a cash retainer,
payable monthly in arrears within 10 days of the end of each month during the
term of the Agreement, as follows:
(i) $115,000 per annum ($9,583.33 per month) for the
first year of this Agreement;
(ii) $125,000 per annum ($10, 416.66 per month) for the
second year of this Agreement;
<PAGE> 2
(iii) $135,000 per annum ($11,250 per month) for the third
year of this Agreement; and
(iv) $145,000 per annum ($12,083.33 per month) for the
fourth year of this Agreement.
(c) The Company hereby issues to the Consultant stock options
covering the Company's common stock as follows:
(i) Subject to Section 2(e) and (f) below, 50,000
non-qualified stock options issued as of the
Effective Date, valid for 10 years from issuance, at
an exercise price of $10.00 per share, vesting 40% on
December 15, 1996 and the remaining 60% on the first
anniversary of the Effective Date, provided the
Consultant has continuously served in a consulting
capacity with the Company as of the applicable
vesting date.
(ii) Subject to Section 2(e) below, 50,000 non-qualified
stock options issued as of the Effective Date, valid
for 10 years from issuance, at an exercise price of
the closing price per share on the last trading day
prior to the Effective Date (the "Exercise Price"),
vesting 16,666 options on the second anniversary of
the Effective Date, 16,667 options on the third
anniversary of the Effective Date, and 16,667 options
on the fourth anniversary of the Effective Date,
provided the Consultant has continuously served in a
consulting capacity with the Company as of the
applicable vesting date (or in the case of the
options vesting on the fourth anniversary of the
Effective Date, through the term of this Agreement).
(iii) Subject to Section 2(d), (e) and (f) below, 50,000
non-qualified stock options issued as of the
Effective Date, valid for 10 years from issuance, at
the Exercise Price, vesting 119 months following the
Effective Date, provided the Consultant has
continuously served in a consulting capacity with the
Company as of the vesting date, but subject to
accelerated vesting as follows:
(A) 15,000 options vesting 30 days following
receipt by the Company in the aggregate
cumulative sum of at least $5 million for the
development by the Company of a "New Polymer
Product" (i.e., a product in the Field, as
defined in Section 4(a) below, other than
"GLIADEL", i.e., PCPP:SA with 3.85% BCNU)
pursuant to one or more strategic alliance,
research and development or similar
transaction(s) between the Company and one or
more third party companies;
<PAGE> 3
(B) 10,000 options vesting 30 days following
receipt by the Company of a cumulative
aggregate sum of at least $3 million for the
development of products in the Field from new
external sources other than those
contemplated in (A) above (e.g., from
government agencies or foundations);
(C) 5,000 options vesting 30 days following
execution of the first license agreement, if
any, between the Company and the
Massachusetts Institute of Technology ("MIT")
and/or The Johns Hopkins University ("JHU")
pursuant to which the Company (in its
absolute discretion) licenses any new polymer
composition or use patent(s) (other than the
patent applications listed in the License
Agreement between Guilford and MIT and JHU
contemplated in Section 2(e) below) invented
by the Consultant and/or his collaborator,
Henry Brem, M.D. of JHU;
(D) 10,000 options vesting 30 days following the
filing by the Company of an Investigational
New Drug for a New Polymer Product containing
a drug other than BCNU;
(E) 10,000 options vesting 30 days following
enrollment of the first patient in a Phase
III Clinical Trial sponsored by the Company
for a New Polymer Product containing a drug
other than BCNU;
(F) 10,000 options vesting 30 days following
submission by the Company of a New Drug
Application for a New Polymer Product; and/or
(G) 10,000 options vesting 30 days following the
closing of a public or private equity
offering (but not including any issuance of
equity to any corporate partner for GLIADEL)
during the term of the Agreement pursuant to
which the Company has raised at least
$10,000,000;
provided that notwithstanding the occurrence of some or all of the
events listed in (A) through (G) above, nothing shall obligate the
Company to issue or vest in excess of 50,000 stock options pursuant to
this Section 2(c)(iii).
(d) Provided that the Consultant was not terminated for cause
(as defined below), or Consultant did not voluntarily terminate the Agreement,
or the Agreement did not terminate due to the death or disability of
Consultant, the provisions of each of Section 2(c)(iii)(A), (B) and (E) shall
survive any termination or expiration of the Agreement for a period of two (2)
years,
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<PAGE> 4
and the provisions of Section 2(c)(iii)(F) shall survive any termination or
expiration of the Agreement until the end of the 119th month following the
Effective Date.
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<PAGE> 5
(e) The stock options described in Section 2(c)(i), (ii) and
(iii) above shall accelerate and vest upon the effective date of a merger where
the Company is not the surviving entity or a disposition of substantially all
of the assets of the Company. In the event of death of Consultant, the legal
representative of the estate or heir will have up to a year thereafter to
exercise vested stock options, but unvested stock options will cease to vest
upon Consultant's death.
(f) The stock options described in Section 2(c)(i) and (iii)
above shall be subject to the condition subsequent that the Company enters into
a License Agreement with MIT and JHU in form and content acceptable to the
Company, MIT and JHU, with respect to the invention of Consultant and Henry
Brem, M.D., entitled "Controlled Local Delivery of Chemotherapeutic Agents for
Treating Solid Tumors" (MIT case no. 6651) and related domestic and foreign
filings as may be set forth in any such License Agreement prior to December 15,
1996.
(g) All tax consequences of fees and other consideration
under this Agreement shall be the responsibility of the Consultant.
(h) The parties hereto agree that the Consultant shall
receive no other compensation (other than reimbursement of reasonable expenses)
for the Consultant's service on behalf of the Company, whether on any advisory
board or otherwise.
3. Term. The term of this Agreement shall commence on the
Effective Date and shall continue for a term of four (4) years, unless further
extended or renewed by mutual agreement of the parties hereto, or unless
earlier terminated as hereinafter provided. This Agreement may be terminated
as follows:
(a) automatically upon the death of the Consultant;
(b) by the Company, if, due to the illness or disability of
the Consultant, the Consultant is unable to perform his obligations under this
Agreement for a period in excess of three (3) consecutive months or 120 days
out of any 12 month period;
(c) by the Company on written notice "for cause"; "for cause"
as used in this Agreement shall mean (i) the failure or refusal on the part of
the Consultant to timely perform his duties under this Agreement; (ii) a
material breach by the Consultant of any other provision of this Agreement;
(iii) the commission by the Consultant of a fraudulent or dishonest act in the
Consultant's relations with the Company; (iv) the conviction of the Consultant
for any crime involving a felony, fraud, embezzlement or the like or an act of
moral turpitude; or (v) other willful, reckless or negligent misconduct or
similar action on the part of the Consultant that is materially damaging or
detrimental to the Company.
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<PAGE> 6
4. Exclusivity and Non-Competition.
(a) The Consultant will consult exclusively for the Company
(except with respect to specific matters with the Company's prior consent), and
will not accept employment from or consult for any other commercial entities,
in the area of targeted controlled delivery of chemotherapeutics, biologicals
and/or other agents for the treatment of cancer (the "Field"). For the
avoidance of doubt: (i) the parties acknowledge that the Consultant has been
and is performing investigations and consulting in the area of antiangiogenesis
for the treatment of cancer, and agree that such investigations and consulting
can continue except that the targeted controlled delivery of such agents for
the treatment of cancer shall be included within the Field as used in this
Agreement; (ii) "targeted" means directing delivery of the product (whether the
active drug, the product or any other component of the product) by design to
the site of the cancer (whether locally placed at the site, introduced
systemically or otherwise); "controlled" means release of the active drug by
design in a polymer vehicle, which vehicle releases the drug over some
non-trivial period of time at the site of the cancer; for a product to be
considered in the Field, it must be both targeted and controlled, and not just
one or the other; (iii) this Section 4(a) will not preclude the Consultant from
engaging in academic research, so long as the Consultant is not consulting
(whether as a consultant or an employee) in the Field for a commercial entity;
and (iv) the Field is intended to encompass therapeutics, not diagnostics or
imaging agents.
(b) The Consultant will disclose in writing to the Company,
in the person of the Chief Executive Officer and the General Counsel of the
Company, prior to the commencement of this Agreement and on every anniversary
during the term of this Agreement (as the same may be extended or renewed), the
Consultant's membership on scientific advisory boards, boards of directors and
similar bodies and commercial entities with which he has a consulting or
employment relationship or an ownership interest of more than 1% of any equity
in a public or private company (in which event such percentage ownership will
be disclosed), which information such disclosees shall keep confidential for a
period of five (5) years from disclosure, provided that such obligation of
confidence shall not apply to information (i) which was at the time of
disclosure or subsequent thereto comes into the public domain through no fault
of the Company, or (ii) which the Company had in its possession at the time of
disclosure by the Consultant, or (iii) which the Company receives in good faith
from a third party who is not, to the Company's knowledge in good faith, under
an obligation of confidentiality to the Consultant with respect to the
information in question, or (iv) which the Company is required to disclose by
law (the contingencies in (i) through (iv) above, "Standard Exceptions to
Confidentiality"), provided that nothing herein shall limit such disclosees
from disclosing such information as they may deem necessary or desirable in the
event of a dispute regarding whether or not this exclusivity provision has been
breached by the Consultant. The Company will use its commercially reasonable
best efforts to destroy the Consultant's written disclosures of memberships and
consultancies no later than five (5) years following disclosure thereof
hereunder.
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<PAGE> 7
(c) In the event of any early termination of this Agreement
by the Consultant prior to the expiration of the four year term set forth in
Section 3 above (or any mutually agreed extension or renewal thereof), the
Consultant agrees that he will not, for a period of one year thereafter, accept
employment from or consult for any other commercial entities in the Field,
provided that this Section 4(c) will not preclude the Consultant from engaging
in academic research.
(d) The Consultant represents and warrants to the Company
that the Consultant is, as of and including the date hereof, under no
contractual or other restriction or obligation, including agreements or
understandings with other parties, which conflicts with this Agreement, the
performance of his duties hereunder or the other obligations of the Consultant
to the Company. The Consultant hereby represents and warrants that he has no
present plans to terminate his present relationship with MIT, whether to join
any pharmaceutical company, another academic institution or otherwise.
(e) Nothing in this Agreement shall be deemed to limit the
Company from engaging other consultants or employees in the Field or otherwise.
5. Independent Contractor Relationship. It is understood and
agreed that the Consultant's relationship with the Company is that of an
independent contractor and that neither this Agreement nor the Services to be
rendered hereunder shall for any purpose whatsoever or in any way or manner
create any employer-employee relationship between the parties.
6. Assignments; Inventions. The Consultant hereby agrees to
use his best efforts without further compensation to assign or to have assigned
to the Company all of his right, title and interest in and to, any and all
inventions, processes, systems, improvements, modifications, secrets, designs
or discoveries, whether or not made, possessed, discovered or conceived by him,
individually or jointly with any other person or persons, whether made in or
out of working hours, in the Field (collectively, the "Inventions"), free and
clear of all liens, charges and encumbrances, created or conceived by him
during the term of this Agreement and patented or reduced to practice within
one year thereafter, provided that the foregoing shall not apply to inventions
which are assigned by the Consultant to MIT pursuant to MIT's policies on
faculty inventions.
7. Disclosure of Inventions. Subject to MIT's policies
regarding faculty invention disclosure, assignment and confidentiality, the
Consultant agrees, during the term of this Agreement, to promptly disclose
Inventions to the Company, and will, either during the term of or after the
expiration or termination of this Agreement for any reason, at the request and
at the sole cost of the Company, sign, execute, make and do all such deeds,
documents, acts and things as the Company and its duly authorized agents may
reasonably require to aid the Company to more fully vest its interest with
respect to Inventions covered by Section 6 above, including without limitation
the following actions:
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<PAGE> 8
(i) apply for, obtain and vest in the name of the Company
alone (unless the Company otherwise directs) letters
patent or other invention protection in any country
throughout the world and when so obtained or vested
to extend, renew and restore the same;
(ii) defend any opposition proceedings in respect of such
applications and any opposition proceedings or
petitions or applications for revocation of such
letters, patents or other analogous protection; and
(iii) perform any other lawful acts which the Company may
reasonably request to carry out the purpose of this
Agreement.
8. Confidentiality.
(a) The Consultant agrees that he will not at any time
publish, reveal, sell, make accessible, give away or disclose to others or use
for his own benefit or except for the benefit of the Company, any research,
development, engineering and manufacturing data, plans, designs, formula,
processes, specifications, techniques, trade secrets, financial information,
customer or supplier lists or other information which are, or pursuant to the
terms hereof become, the property or confidential information of the Company or
any of its clients, customers, consultants, licensees or affiliates, or which
are acquired by him directly as a result of his acting as consultant to the
Company, except to such extent as may be required by law. The Consultant
agrees that he will not make any notes or memoranda relating to any matter that
is a art of the trade, activities or business of the Company or concerning any
of its dealings otherwise than for the benefit of the Company. The Consultant
shall at the Company's request return or destroy all tangible embodiments of
such confidential information prior to or at the termination of this Agreement.
(b) The parties agree to keep the fact and all terms of this
Agreement strictly confidential except: (i) in case of any Standard Exceptions
to Confidentiality; (ii) to the extent the Company deems disclosure necessary
or desirable under its public reporting obligations under securities laws;
(iii) to the extent mutually agreed by the parties hereto; and (iv) to the
extent the Consultant needs to disclose same to MIT pursuant to any obligation
to clear this Agreement with MIT, provided that Consultant will request
confidential treatment to be afforded same to the greatest extent possible.
9. Publication of Company Information. Subject to Section 8
above, the Consultant may publish information relating to the Field if in each
instance the Consultant provides Company thirty (30) days for review and
comment upon the manuscript or other material for such publication. Expedited
reviews for abstracts or poster presentations may be arranged if mutually
agreeable to the Consultant and the Company. In addition, if requested in
writing by the Company, the Consultant will withhold such publication an
additional sixty (60)
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<PAGE> 9
days to allow for filing a patent application or taking such other measures as
the Company deems appropriate to establish and preserve available proprietary
rights.
10. Breach of Agreement. The Consultant and the Company
agree that any material breach of this Agreement by either of them could cause
irreparable damage to the other party, and that in the event of such material
breach, in addition to any other remedies hereinbefore mentioned, the
non-breaching party shall have the right to obtain injunctive relief,
including, without limitation, specific performance or other equitable relief
to prevent the violation of the breaching party's obligations hereunder. It is
expressly understood and agreed that nothing herein contained shall be
construed as prohibiting the non-breaching party from pursuing any other
remedies available for such material breach including, without limitation, the
recovery of damages by the non-breaching party.
11. Assignment; Binding Effect. The Services to be rendered
by the Consultant are personal in nature. The Consultant may not assign or
transfer this Agreement or any of his rights or obligations hereunder. In no
event shall the Consultant assign or delegate responsibility for actual
performance or Services or any other obligations hereunder. Subject to the
foregoing, this Agreement shall be binding upon and inure to the benefit of the
parties and their respective legal representatives, successors and assigns.
12. Notices. All notices and other communications hereunder
shall be delivered or sent by registered or certified mail or by a major
recognized express courier service (such as Federal Express), return receipt
requested, addressed to the Company at 6611 Tributary Street, Baltimore,
Maryland 21224, Attn.: Dr. Craig R. Smith, or to the Consultant at the address
set forth above, or to such other address as either party may designate in
writing to the other.
13. Entire Agreement. This Agreement constitutes the entire
agreement between the parties as to the subject matter hereof and supersedes
and terminates as of this date any prior agreements between the parties for the
Services engaged hereunder. No provision of this Agreement shall be waived,
altered or canceled except in writing signed by the party against whom such
waiver, alteration or cancellation is asserted. Any such waiver shall be
limited to the particular instance and time and shall not constitute a waiver
of any subsequent instance without a specific waiver in writing by the party
against whom such waiver is sought to be enforced.
14. Counterpart. This Agreement may be executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
15. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Maryland, without giving
effect to conflict of laws.
16. Severability. In the event that any term of this
Agreement is held to be invalid, illegal, or unenforceable, such invalidity,
illegality, or unenforceability shall not affect any other portion of this
Agreement, and there shall be deemed substituted therefor such term as
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<PAGE> 10
will most fully realize the intent of the parties as expressed in this
Agreement to the fullest extent permitted by applicable law, the parties hereby
declaring their intent that this Agreement be construed in such fashion as to
maintain its existence, validity, and enforceability to the greatest extent
possible.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date and year first above written.
GUILFORD PHARMACEUTICALS INC.
By: /s/ Craig R. Smith, M.D. /s/ Robert S. Langer, Ph.D.
------------------------------------- -------------------------------
Name: Craig R. Smith, M.D. Robert S. Langer, Ph.D.
Title: President and Chief Executive
Officer
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<PAGE> 1
EXHIBIT 4.1h
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT is made as of the date last signed
by the parties hereto as indicated on the signature page hereof (the "Effective
Date"), by and between Guilford Pharmaceuticals Inc., a Delaware corporation,
with its principal offices at 6611 Tributary Street, Baltimore, Maryland 21224
(the "Company"), and Kam W. Leong, Ph.D., of 10242 Breconshire Road, Ellicott
City, Maryland 21042 (the "Consultant").
WHEREAS, the Company desires to engage the Consultant, and the
Consultant desires to be engaged by the Company, pursuant to the terms
contained in this Agreement;
NOW THEREFORE, in consideration of the mutual promises of the
parties hereunder, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Company and the
Consultant hereby agree as follows:
1. Services. The Company hereby retains the Consultant to
perform, and the Consultant hereby agrees to render to the Company, consulting
and advisory services as requested from time to time by the Company in the
field of biodegradable polymers and such other matters as the Company may
request from time to time (the "Services"). If the Company forms a scientific
advisory board in the area of biodegradable polymers (distinct from the
currently existing Scientific Advisory Board and any board of advisors related
to brain tumor therapeutics), the Company agrees to appoint the Consultant to,
and Consultant agrees to serve on, such polymer scientific advisory board as
part of the Services. Consultant agrees to use reasonable efforts to perform
the Services and to make himself available to render the Services for up to 38
days per year, at the Company's discretion, at times which are mutually
acceptable, during the term of this Agreement.
2. Consulting Fees.
(a) As complete consideration for the performance of the
Services by the Consultant under this Agreement, the Company agrees, subject to
the terms of this Agreement, to pay the Consultant a cash retainer and issue
stock options as provided in this Section 2.
(b) The Company agrees to pay the Consultant a cash retainer,
payable monthly in arrears within 10 days of the end of each month during the
term of the Agreement, in the amount of $3,000 per month.
(c) Commencing on the Effective Date and on each of the
following three (3) anniversaries thereof during the term of this Agreement, so
long as the Consultant remains a consultant to the Company in compliance with
his obligations under this Agreement, the Company shall issue to the Consultant
5,000 stock options (which may be incentive stock options or non-qualified
stock options at the Company's option), valid for 10 years from
<PAGE> 2
issuance, at an exercise price of the closing price per share on the last
trading day prior to the issuance of such stock options.
(d) All tax consequences of fees and other consideration
under this Agreement shall be the responsibility of the Consultant.
(e) The parties hereto agree that the Consultant shall
receive no other compensation (other than reimbursement of reasonable expenses)
for the Consultant's service on behalf of the Company, whether on any advisory
board or otherwise.
3. Term. The term of this Agreement shall commence on the
Effective Date and shall continue for a term of four (4) years, unless further
extended or renewed by mutual agreement of the parties hereto, or unless
earlier terminated as hereinafter provided. This Agreement may be terminated
as follows:
(a) automatically upon the death of the Consultant;
(b) by the Company, if, due to the illness or disability of
the Consultant, the Consultant is unable to perform his obligations under this
Agreement for a period in excess of three (3) consecutive months or 120 days
out of any 12 month period;
(c) by the Company on written notice "for cause"; "for cause"
as used in this Agreement shall mean (i) the failure or refusal on the part of
the Consultant to timely perform his duties under this Agreement; (ii) a
material breach by the Consultant of any other provision of this Agreement;
(iii) the commission by the Consultant of a fraudulent or dishonest act in the
Consultant's relations with the Company; (iv) the conviction of the Consultant
for any crime involving a felony, fraud, embezzlement or the like or an act of
moral turpitude; or (v) other willful, reckless or negligent misconduct or
similar action on the part of the Consultant that is materially damaging or
detrimental to the Company;
(d) by either party upon thirty (30) days' written notice.
4. Exclusivity and Non-Competition.
(a) The Consultant will consult exclusively for the Company
(except with respect to specific matters with the Company's prior consent), and
will not accept employment from or consult for any other commercial entities,
except as set forth in Appendix A attached hereto, or except pursuant to prior
written consent of the Company.
(b) In the event of any early termination of this Agreement
by the Consultant prior to the expiration of the four year term set forth in
Section 3 above (or any mutually agreed extension or renewal thereof), the
Consultant agrees that he will not, for a period of one year thereafter, accept
employment from or consult for any other commercial entities in the field of
targeted controlled delivery of drugs via biodegradable polymers, provided that
this Section 4(b)
<PAGE> 3
will not preclude the Consultant from (i) engaging in academic research or (ii)
performing the work described, for the companies listed, on Appendix A attached
hereto.
(c) The Consultant represents and warrants to the Company
that the Consultant is, as of and including the date hereof, under no
contractual or other restriction or obligation, including agreements or
understandings with other parties, which conflicts with this Agreement, the
performance of his duties hereunder or the other obligations of the Consultant
to the Company. The Consultant hereby represents and warrants that he has no
present plans to terminate his present relationship with Johns Hopkins
University, whether to join any pharmaceutical company, another academic
institution or otherwise.
(d) Nothing in this Agreement shall be deemed to limit the
Company from engaging other consultants or employees.
5. Independent Contractor Relationship. It is understood and
agreed that the Consultant's relationship with the Company is that of an
independent contractor and that neither this Agreement nor the Services to be
rendered hereunder shall for any purpose whatsoever or in any way or manner
create any employer-employee relationship between the parties.
6. Assignments; Inventions. The Consultant hereby agrees to
use his best efforts without further compensation to assign or to have assigned
to the Company all of his right, title and interest in and to, any and all
inventions, processes, systems, improvements, modifications, secrets, designs
or discoveries, whether or not made, possessed, discovered or conceived by him,
individually or jointly with any other person or persons, whether made in or
out of working hours, free and clear of all liens, charges and encumbrances,
created or conceived by him during the term of this Agreement and patented or
reduced to practice within one year thereafter, which relate to the business of
the Company and which are not owned by The Johns Hopkins University pursuant to
the Johns Hopkins School of Medicine Intellectual Property Guidelines (dated
January 1, 1995), a copy of which is attached hereto as Appendix B and
incorporated herein by reference (collectively, the "Inventions").
7. Disclosure of Inventions. The Consultant agrees to
promptly disclose Inventions to the Company. With respect to the Inventions,
the Consultant will, either during the term of or after the expiration or
termination of this Agreement for any reason, at the request and at the sole
cost of the Company, sign, execute, make and do all such deeds, documents, acts
and things as the Company and its duly authorized agents may reasonably
require, and further agrees to:
(i) apply for, obtain and vest in the name of the Company
alone (unless the Company otherwise directs) letters
patent or other invention protection in any country
throughout the world and when so obtained or vested
to extend, renew and restore the same;
- 3 -
<PAGE> 4
(ii) defend any opposition proceedings in respect of such
applications and any opposition proceedings or
petitions or applications for revocation of such
letters patent or other analogous protection; and
(iii) perform any other lawful acts which the Company may
reasonably request to carry out the purpose of this
Agreement.
8. Confidentiality.
The Consultant agrees that he will not at any time publish,
reveal, sell, make accessible, give away or disclose to others or use for his
own benefit or except for the benefit of the Company, any research,
development, engineering and manufacturing data, plans, designs, formula,
processes, specifications, techniques, trade secrets, business and financial
information, customer or supplier lists or other information which are, or
pursuant to the terms hereof become, the property or confidential information
of the Company or any of its clients, customers, consultants, licensees or
affiliates, or which are acquired by him directly as a result of his acting as
consultant to the Company, except to such extent as may be required by law.
The Consultant agrees that he will not make any notes or memoranda relating to
any matter that is an art of the trade, activities or business of the Company
or concerning any of its dealings otherwise than for the benefit of the
Company. The Consultant shall at the Company's request return or destroy all
tangible embodiments of such confidential information prior to or at the
termination of this Agreement.
9. Publication. Subject to Section 8 above, the Consultant
may publish information arising from his performance of Services under this
Agreement if in each instance the Consultant provides Company thirty (30) days
for review and comment upon the manuscript or other material for such
publication. Expedited reviews for abstracts or poster presentations may be
arranged if mutually agreeable to the Consultant and the Company. In addition,
if requested in writing by the Company, the Consultant will withhold such
publication an additional sixty (60) days to allow for filing a patent
application or taking such other measures as the Company deems appropriate to
establish and preserve available proprietary rights.
10. Breach of Agreement. The Consultant and the Company
agree that any material breach of this Agreement by either of them could cause
irreparable damage to the other party, and that in the event of such material
breach, in addition to any other remedies hereinbefore mentioned, the
non-breaching party shall have the right to obtain injunctive relief,
including, without limitation, specific performance or other equitable relief
to prevent the violation of the breaching party's obligations hereunder. It is
expressly understood and agreed that nothing herein contained shall be
construed as prohibiting the non-breaching party from pursuing any other
remedies available for such material breach including, without limitation, the
recovery of damages by the non-breaching party.
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<PAGE> 5
11. Assignment; Binding Effect. The Services to be rendered
by the Consultant are personal in nature. The Consultant may not assign or
transfer this Agreement or any of his rights or obligations hereunder. In no
event shall the Consultant assign or delegate responsibility for actual
performance or Services or any other obligations hereunder. Subject to the
foregoing, this Agreement shall be binding upon and inure to the benefit of the
parties and their respective legal representatives, successors and assigns.
12. Notices. All notices and other communications hereunder
shall be delivered or sent by registered or certified mail or by a major
recognized express courier service (such as Federal Express), return receipt
requested, addressed to the Company at 6611 Tributary Street, Baltimore,
Maryland 21224, Attn.: Dr. Craig R. Smith, or to the Consultant at the address
set forth above, or to such other address as either party may designate in
writing to the other.
13. Entire Agreement. This Agreement constitutes the entire
agreement between the parties as to the subject matter hereof and supersedes
and terminates as of this date any prior agreements between the parties for the
Services engaged hereunder. No provision of this Agreement shall be waived,
altered or canceled except in writing signed by the party against whom such
waiver, alteration or cancellation is asserted. Any such waiver shall be
limited to the particular instance and time and shall not constitute a waiver
of any subsequent instance without a specific waiver in writing by the party
against whom such waiver is sought to be enforced.
14. Counterpart. This Agreement may be executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
15. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Maryland, without giving
effect to conflict of laws.
16. Severability. In the event that any term of this
Agreement is held to be invalid, illegal, or unenforceable, such invalidity,
illegality, or unenforceability shall not affect any other portion of this
Agreement, and there shall be deemed substituted therefor such term as will
most fully realize the intent of the parties as expressed in this Agreement to
the fullest extent permitted by applicable law, the parties hereby declaring
their intent that this Agreement be construed in such fashion as to maintain
its existence, validity, and enforceability to the greatest extent possible.
17. Johns Hopkins University Not A Party. The parties
acknowledge that The Johns Hopkins University, the Consultant's employer as of
the date hereof, is not a party to this Agreement, which is a private contract
between the Consultant and the Company. Notwithstanding the foregoing, the
parties agree as follows: with the limited exception of citing Consultant's
faculty title and institutional affiliation, the Company and its affiliates
will not use the names, likenesses, or logos of the Johns Hopkins University,
any of its Schools or Divisions, or the Johns Hopkins Hospital and Health
System in any of their fundraising or investment documents, general
publications, advertisements, or marketing and promotional materials without
the prior written permission of the Johns Hopkins University. A request for
such
- 5 -
<PAGE> 6
permission must be submitted by the Consultant to the School of Medicine's
Conflict of Interest Review Coordinator, who in appropriate circumstances, will
have it reviewed by the School of Medicine's Office of Public Affairs.
- 6 -
<PAGE> 7
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date and year first above written.
GUILFORD PHARMACEUTICALS INC.
By: /s/ Craig R. Smith, M.D. /s/ Kam W. Leong, Ph.D.
------------------------------------------- -----------------------------
Name: Craig R. Smith, M.D. Kam W. Leong, Ph.D.
Title: President & Chief Executive Officer
Date: June 28, 1996 Date: Sept. 10, 1996
- 7 -
<PAGE> 8
Appendix A
Company Consulting Area
- ------- ---------------
Synthes Maxillofacial Biodegradable orthopedic prostheses
Bionix Biodegradable orthopedic prostheses
AO Research Institute Biodegradable polymers
Anticipated Arrangements:
BioWhittaker Cell encapsulation technologies and polymeric
scaffolding for tissue engineering and toxicology
applications
New Venture Gene, protein and peptide delivery technologies
- 8 -
<PAGE> 9
Appendix B
- 9 -
<PAGE> 1
EXHIBIT 5
December 13, 1996
Board of Directors
Guilford Pharmaceuticals Inc.
6611 Tributary Street
Baltimore, Maryland 21224
Gentlemen:
We are acting as counsel to Guilford Pharmaceuticals Inc., a
Delaware corporation (the "Company"), in connection with its registration
statement on Form S-8 (the "Registration Statement") filed with the Securities
and Exchange Commission on December 13, 1996 relating to the proposed public
offering of up to 2,590,000 shares of the Company's common stock, par value
$.01 per share (the "Shares"), issuable in connection with the Guilford
Pharmaceuticals Inc. 1993 Employee Share Option and Restricted Share Plan, as
amended, the Guilford Pharmaceuticals Inc. 401(k) Plan, as amended, Guilford
Pharmaceuticals Inc. Non-Qualified Stock Option Agreement (Richard L. Casey),
the Guilford Pharmaceuticals Inc. Non-Qualified Stock Option Agreement (John H.
Newman), the Consulting Agreement (Henry H. Brem), the Consulting Agreement
(Robert S. Langer), the Consulting Agreement (Kam S. Leong) and the Consulting
Agreement (Solomon H. Snyder) (collectively, the "Plans"). This opinion
letter is furnished to you at your request to enable you to fulfill the
requirements of Item 601(b)(5) of Regulation S-K, 17 C.F.R. Section
229.601(b)(5), in connection with the Registration Statement.
For purposes of this opinion letter, we have examined copies
of the following documents:
1. An executed copy of the Registration Statement.
2. Copies of the Plans as certified on the date hereof,
by the Secretary of the Company as then being complete, accurate and
in effect.
3. The Amended and Restated Certificate of Incorporation
of the Company, as certified by the Secretary of the State of the
State of Delaware on December 11, 1996 and by the Secretary of the
Company on the date hereof as then being complete, accurate and in
effect.
<PAGE> 2
Board of Directors
Guilford Pharmaceuticals Inc.
December 13, 1996
Page 2
4. The Bylaws of the Company, as certified by the
Secretary of the Company on the date hereof as then being complete,
accurate and in effect.
5. Resolutions of the Board of Directors of the Company
adopted on September 8, 1993, March 14, 1994, December 7, 1994 and
December 2, 1996, a written consent of the Board of Directors
effective on March 14, 1995, a written consent of the Stockholders of
the Company effective on March 23, 1994 and a report on the vote of
the Stockholders on May 21, 1996, as certified by the Secretary of the
Company on the date hereof as then being complete, accurate and in
effect, relating to the issuance and sale of the Shares and
arrangements in connection therewith.
We have not, except as specifically identified above, made any
independent review or investigation of factual or other matters, including the
organization, existence, good standing, assets, business or affairs of the
Company. In our examination of the aforesaid documents, we have assumed the
genuineness of all signatures, the legal capacity of all natural persons, the
accuracy and completeness of all documents submitted to us, the authenticity of
all original documents and the conformity to authentic original documents of
all documents submitted to us as copies (including telecopies). This opinion
letter is given, and all statements herein are made, in the context of the
foregoing.
This opinion letter is based as to matters of law solely on
the General Corporation Law of the State of Delaware. We express no opinion
herein as to any other laws, statutes, regulations, or ordinances.
Based upon, subject to and limited by the foregoing, we are of
the opinion that the Shares, when issued and delivered in a manner and on the
terms described in the Registration Statement and the Plans (with the Company
having received the consideration therefor, the form of which is in accordance
with applicable law), will be validly issued, fully paid and nonassessable
under the General Corporation Law of the State of Delaware.
We assume no obligation to advise you of any changes in the
foregoing subsequent to the delivery of this opinion letter. This opinion
letter has been prepared solely for your use in connection with the filing of
the Registration Statement on the date of this opinion letter and should not be
quoted in whole or in
<PAGE> 3
Board of Directors
Guilford Pharmaceuticals Inc.
December 13, 1996
Page 3
part or otherwise be referred to, nor filed with or furnished to any
governmental agency or other person or entity, without the prior written
consent of this firm.
We hereby consent to the filing of this opinion letter as
Exhibit 5 to the Registration Statement. In giving this consent, we do not
thereby admit that we are an "expert" within the meaning of the Securities Act
of 1933, as amended.
Very truly yours,
/s/ HOGAN & HARTSON L.L.P.
-----------------------------
HOGAN & HARTSON L.L.P.
cc: Thomas C. Seoh
<PAGE> 1
EXHIBIT 23.2
Accountants' Consent
The Board of Directors
Guilford Pharmaceuticals:
We consent to the use of our report incorporated herein by reference.
Philadelphia, PA
December 12, 1996
/s/ KPMG PEAT MARWICK LLP
-----------------------------
KPMG PEAT MARWICK LLP
