<PAGE> 1
As filed with the Securities and Exchange Commission on February 12, 1999
Registration No. 333-_____
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
GUILFORD PHARMACEUTICALS INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C> <C>
DELAWARE 52-1841960
(State or other jurisdiction of 6611 TRIBUTARY STREET (I.R.S. Employer
incorporation or organization) BALTIMORE, MARYLAND 21224 Identification Number)
(Address of principal executive offices) (Zip code)
</TABLE>
1998 EMPLOYEE SHARE OPTION AND RESTRICTED SHARE PLAN
(Full title of the plan)
CRAIG R. SMITH, M.D.
CHIEF EXECUTIVE OFFICER, PRESIDENT AND CHAIRMAN OF THE BOARD
GUILFORD PHARMACEUTICALS INC.
6611 TRIBUTARY STREET
BALTIMORE, MARYLAND 21224
(Name and address of agent for service)
(410) 631-6300
(Telephone number, including area code, of agent for service)
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WITH A COPY TO:
MICHAEL J. SILVER
HOGAN & HARTSON L.L.P.
111 SOUTH CALVERT STREET
BALTIMORE, MARYLAND 21202
(410) 659-2700
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===================================================================================================================================
Title of securities Amount to be Proposed maximum Proposed maximum Amount of
to be registered registered (1) offering price per share (1) aggregate offering price (1) registration fee(1)
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value 600,000 $13.125 $7,875,000 $2,190.00
$.01 per share, and Series
A Junior Participation
Preferred Share Purchase
Rights
===================================================================================================================================
</TABLE>
(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 the average of the bid and asked price of
$13.125 per share of Guilford Pharmaceuticals Inc. common stock on
February 9, 1999 as reported on the NASDAQ National Market.
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Guilford Pharmaceuticals, Inc. (the "Registrant") will separately send
or give documents containing the information required to be provided in this
Part I to its employees participating in the Guilford Pharmaceuticals Inc. 1998
Employee Share Option and Restricted Share Plan (the "Plan"), as contemplated by
Rule 428(b)(1) under the Securities Act of 1933, as amended (the "Securities
Act"). In accordance with the instructions to Part I of Form S-8, the Registrant
will not file these documents with the Securities and Exchange Commission (the
"Commission"), either as part of this Registration Statement or as prospectuses
or prospectus supplements pursuant to Rule 424 under the Securities Act.
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) Annual report on Form 10-K for the year ended December 31, 1997
filed with the SEC on March 27, 1998;
(b) All reports filed with the Commission pursuant to Section 13(a)
or 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), since December 31, 1997.
(c) The description of the Registrant's common stock contained in
the Registrant's Registration Statement on Form 8-A filed with
the Commission on March 25, 1994, registering shares of Common
Stock pursuant to Section 12(g) of the Exchange Act.
In addition, all documents subsequently filed by the Registrant
pursuant to Section 13(a), 13(c), 14, or 15(d) of the Exchange Act, prior to the
filing of a post-effective amendment 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.
2
<PAGE> 3
ITEM 4. DESCRIPTION OF SECURITIES.
A description of the Registrant's common stock, par value $ .01 per
share, is incorporated by reference under Item 3.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Under Section 145 of the Delaware General Corporation Law ("DGCL"),
the Registrant has broad powers to indemnify its directors and officers against
liabilities they may incur in such capacities, including liabilities under the
Securities Act. 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.
* * * * *
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to trustees, 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 Commission such
indemnification is against public policy as expressed in the Securities 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 trustee, officer or controlling person of the
Registrant of the successful defense of any action, suit or proceeding) is
asserted by such trustee, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in the opinion of
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by the
Registrant is against public policy as expressed in the Securities Act and will
be governed by the final adjudication of such issue.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
3
<PAGE> 4
ITEM 8. EXHIBITS.
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------ -----------
<S> <C>
4.6 Guilford Pharmaceuticals Inc. 1998 Employee Share Option and Restricted
Share 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. (contained in Exhibit 5)
23.2 Consent of KPMG LLP
24 Power of Attorney (contained on signature page)
</TABLE>
4
<PAGE> 5
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:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act;
(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 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 Exchange Act that are incorporated by
reference in this Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act, 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, each
filing of the Registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Exchange Act that is incorporated
by reference in this 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) The undertaking concerning indemnification is set forth under
the response to Item 6.
(d) The undersigned Registrant hereby undertakes to deliver or
cause to be delivered with the prospectus, to each person to
whom the prospectus is sent or given, the latest annual report,
to security holders that is incorporated by reference in the
prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or 14c-3 under the Securities
Exchange Act of 1934; and, where interim financial information
required to be presented by Article 3 of Regulation S-X is not
set forth in the prospectus, to deliver, or cause to be
delivered to each person to whom the
5
<PAGE> 6
prospectus is sent or given, the latest quarterly report that
is specifically incorporated by reference in the prospectus to
provide such interim financial information.
6
<PAGE> 7
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------ -----------
<S> <C>
4.6 Guilford Pharmaceuticals Inc. 1998 Employee Share Option and Restricted
Share 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. (contained in Exhibit 5)
23.2 Consent of KPMG LLP
24 Power of Attorney (contained on signature page)
</TABLE>
7
<PAGE> 8
SIGNATURES
Pursuant to the requirements of the Securities Act, 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, Maryland, on February 12, 1999
Guilford Pharmaceuticals Inc.
By: /s/ Craig R. Smith, M.D.
--------------------------------------
Craig R. Smith, M.D.
Chief Executive Officer, President and
Chairman of the Board of Directors
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.
We, the undersigned officers and directors of Guilford Pharmaceuticals Inc.,
hereby severally and individually constitute and appoint Craig R. Smith, M.D.,
Andrew R. Jordan, Thomas C. Seoh, Jordan P. Karp 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.
Date: February 12, 1999 /s/ Craig R. Smith, M.D.
---------------------------------------------
Craig R. Smith, M.D.
Chief Executive Officer, President and
Chairman of the Board of Directors
Date: February 12, 1999 /s/ Andrew R. Jordan
---------------------------------------------
Andrew R. Jordan
Senior Vice President, Chief Financial
Officer and Treasurer
Date: February 11, 1999 /s/ George L. Bunting, Jr.
---------------------------------------------
George L. Bunting, Jr.
Director
Date: February 12, 1999 /s/ Richard L. Casey
---------------------------------------------
Richard L. Casey
Director
Date: February 12, 1999 /s/ Elizabeth M. Greetham
---------------------------------------------
Elizabeth M. Greetham
Director
8
<PAGE> 9
Date: February 12, 1999 /s/ Joseph Klein, III
---------------------------------------------
Joseph Klein, III
Director
Date: February 12, 1999 /s/ Solomon H. Snyder, M.D.
---------------------------------------------
Solomon H. Snyder, M.D.
Director
Date: February 12, 1999 /s/ W. Leigh Thompson, M.D., Ph.D.
---------------------------------------------
W. Leigh Thompson, M.D., Ph.D.
Director
9
<PAGE> 1
EXHIBIT 4.6
GUILFORD PHARMACEUTICALS INC.
1998 EMPLOYEE SHARE OPTION AND RESTRICTED SHARE PLAN
Guilford Pharmaceuticals Inc., sets forth herein the terms of this
1998 Employee Share Option and Restricted Share Plan as follows:
1. PURPOSE
The Plan is intended to advance the interests of the Company by
providing eligible individuals (as designated pursuant to Section 5 below) with
incentives to improve business results, by providing an opportunity to acquire
or increase a proprietary interest in the Company, which thereby will create a
stronger incentive to expend maximum effort for the growth and success of the
Company, and will encourage such eligible individuals to continue to serve the
Company. To this end, the Plan provides for the grant of share options and
restricted shares all as set out herein.
2. DEFINITIONS
For purposes of interpreting the Plan and related documents (including
Share Option Agreements and Restricted Share Agreements), the following
definitions shall apply:
2.1. "Affiliate" means any company or other trade or business
that is controlled by or under common control with the Company (determined in
accordance with the principles of Section 414(b) and 414(c) of the Code and the
regulations thereunder).
2.2. "Agreement" means a written agreement between the
Company and the recipient individual that sets out the terms and conditions of
the grant of an Incentive Award.
2.3. "Board" means the Board of Directors of the Company.
2.4. "Code" means the Internal Revenue Code of 1986, as now
in effect or as hereafter amended.
2.5. "Committee" means the stock option committee appointed
by the Board pursuant to Section 3.2 of the Plan.
2.6. "Company" means Guilford Pharmaceuticals Inc.
2.7. "Effective Date" means the date of adoption of the Plan
by the Board.
<PAGE> 2
2.8. "Exchange Act" means the Securities Exchange Act of
1934, as now in effect or as hereafter amended.
2.9. "Exercise Price" means the Option Price multiplied by
the number of Shares purchased pursuant to the exercise of an Option.
2.10. "Expiration Date" means the date fixed for termination
of the option at the time it is granted, or, if earlier, the termination of the
option pursuant to Section 18.3.
2.11. "Fair Market Value" means the value of each Share
subject to the Plan determined as follows: if on the Grant Date or other
determination date the Shares are listed on an established national or regional
stock exchange, are admitted to quotation on the National Association of
Securities Dealers Automated Quotation System, or are publicly traded on an
established securities market, the Fair Market Value of the Shares shall be the
closing price of the Shares 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 Grant Date or such 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 Shares is reported for such
trading day, on the next preceding day on which any sale shall have been
reported. If the Shares are not listed on such an exchange, quoted on such
System or traded on such a market, Fair Market Value shall be determined by the
Board in good faith.
2.12. "Grant Date" means the later of (i) the date as of which
the Board approves the grant and (ii) the date as of which the Optionee and the
Company or Subsidiary enter the relationship resulting in the Optionee being
eligible for grants.
2.13. "Holder" means a person who holds Restricted Shares
under the Plan.
2.14. "Incentive Award" means an award of an Option or
Restricted Shares under the Plan.
2.15. "Option" means an option to purchase one or more Shares
pursuant to the Plan.
2.16. "Optionee" means a person who holds an Option under the
Plan.
2.17. "Option Period" means the period during which Options
may be exercised as defined in Section 11.
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<PAGE> 3
2.18. "Option Price" means the purchase price for each Share
subject to an Option.
2.19. "Plan" means the Guilford Pharmaceuticals Inc. 1998
Employee Share Option and Restricted Share Plan.
2.20. "Reporting Person" means a person who is required to
file reports under Section 16(a) of the Exchange Act.
2.21. "Restricted Share Agreement" means the written agreement
evidencing the grant of Restricted Shares hereunder.
2.22. "Restricted Share Award" means an award of the right to
purchase restricted Shares granted pursuant to Section 12 of this Plan.
2.23. "1933 Act" means the Securities Act of 1933, as now in
effect or as hereafter amended.
2.24. "Shares" mean share of common stock, par value $.01 per
Share, of the Company.
2.25. "Share Option Agreement" means the written agreement
evidencing the grant of an Option hereunder.
2.26. "Subsidiary" means any "subsidiary corporation" of the
Company within the meaning of Section 425(f) of the Code.
3. ADMINISTRATION
3.1. BOARD.
The Plan shall be administered by the Board, which shall have
the full power and authority to take all actions and to make all determinations
required or provided for under the Plan or any Option or Restricted Share Award
granted or Share Option or Restricted Share Agreement entered into hereunder and
all such other actions and determinations not inconsistent with the specific
terms and provisions of the Plan deemed by the Board to be necessary or
appropriate to the administration of the Plan or any Option granted or Share
Option Agreement entered into hereunder. The interpretation and construction by
the Board of any provision of the Plan or of any Option granted or Share Option
Agreement entered into hereunder shall be final and conclusive.
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<PAGE> 4
3.2. COMMITTEE
The Board may from time to time appoint the Committee, and the
Board, in its sole discretion, may provide that the role of the Committee shall
be limited to making recommendations to the Board concerning any determinations
to be made and actions to be taken by the Board pursuant to or with respect to
the Plan, or the Board may delegate to the Committee such powers and authorities
related to the administration of the Plan, as set forth in Section 3.1 hereof,
as the Board shall determine, consistent with the Amended and Restated
Certificate of Incorporation, as amended and Bylaws of the Company and
applicable law. In the event that the Plan or any Option or Restricted Share
Award granted or Share Option or Restricted Share Agreement entered into
hereunder provides for any action to be taken by or determination to be made by
the Board, such action may be taken by or such determination may be made by the
Committee if the power and authority to do so has been delegated to the
Committee by the Board as provided for in this Section 3.2. Unless otherwise
expressly determined by the Board, any such action or determination by the
Committee shall be final and conclusive.
3.3. NO LIABILITY
No member of the Board or of the Committee shall be liable for
any action or determination made, or any failure to take or make an action or
determination, in good faith with respect to the Plan or any Option or
Restricted Share Award granted or Share Option or Restricted Share Agreement
entered into hereunder.
4. SHARES
The Shares that may be issued pursuant to Incentive Awards may be
treasury Shares or authorized but unissued Shares. The number of Shares that may
be issued pursuant to Incentive Awards under the Plan shall not exceed, in the
aggregate, 600,000 Shares. No more than 50,000 Shares may be issued pursuant to
Restricted Share Awards under the Plan. If any Incentive Award expires,
terminates, or is terminated or canceled for any reason prior to exercise or
vesting in full, the Shares that were subject to the unexercised, forfeited, or
terminated portion of such Incentive Award shall be available immediately for
future grants of Incentive Awards under the Plan.
5. ELIGIBILITY
5.1. DESIGNATED RECIPIENTS
Subject to the next sentence, Incentive Awards may be granted
under the Plan to (i) any full-time employee of the Company or any Subsidiary
(including any such individual who is an officer or director of the Company or
any Subsidiary or Affiliate) as the Board shall determine and designate from
time to
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<PAGE> 5
time or (ii) any other individual whose participation in the Plan is determined
by the Board to be in the best interests of the Company and is so designated by
the Board (such determination to be deemed to be made with respect to any
recipient by virtue of the grant of an Incentive Award to such an individual).
5.2. SUCCESSIVE GRANTS
An individual may hold more than one Incentive Award, subject
to such restrictions as are provided herein.
6. EFFECTIVE DATE AND TERM OF THE PLAN
6.1. EFFECTIVE DATE
The Plan shall be effective as of February 17, 1998, the date
of adoption by the Board.
6.2. TERM
The Plan has no termination date.
7. GRANT OF OPTIONS
Subject to the terms and conditions of the Plan, the Board may,
at any time and from time to time, grant to such eligible individuals as the
Board may determine, Options to purchase such number of Shares on such terms and
conditions as the Board may determine. Such authority specifically includes the
authority, in order to effectuate the purposes of the Plan but without amending
the Plan, to modify grants to eligible individuals who are foreign nationals or
are individuals who are employed outside the United States to recognize
differences in local law, tax policy, or custom.
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<PAGE> 6
8. PARACHUTE LIMITATIONS
Notwithstanding any other provision of this Plan or of any other
agreement, contract, or understanding heretofore or hereafter entered into by
the Optionee with the Company, except an agreement, contract, or understanding
hereafter entered into that expressly modifies or excludes application of this
paragraph (an "Other Agreement"), and notwithstanding any formal or informal
plan or other arrangement for the direct or indirect provision of compensation
to the Optionee (including groups or classes of participants or beneficiaries of
which the Optionee is a member), whether or not such compensation is deferred,
is in cash, or is in the form of a benefit to or for the Optionee (a "Benefit
Arrangement"), if the Optionee is a "disqualified individual," as defined in
Section 280G(c) of the Code, any Option held by that Optionee and any right to
receive any payment or other benefit under this Plan shall not become
exercisable or vested (i) to the extent that such right to exercise, vesting,
payment, or benefit, taking into account all other rights, payments, or benefits
to or for the Optionee under this Plan, all Other Agreements, and all Benefit
Arrangements, would cause any payment or benefit to the Optionee under this Plan
to be considered a "parachute payment" within the meaning of Section 280G(b)(2)
of the Internal Revenue Code as then in effect (a "Parachute Payment") and (ii)
if, as a result of receiving a Parachute Payment, the aggregate after-tax
amounts received by the Optionee from the Company under this Plan, all Other
Agreements, and all Benefit Arrangements would be less than the maximum
after-tax amount that could be received by him or her without causing any such
payment or benefit to be considered a Parachute Payment. In the event that the
receipt of any such right to exercise, vesting, payment, or benefit under this
Plan, in conjunction with all other rights, payments, or benefits to or for the
Optionee under any Other Agreement or any Benefit Arrangement would cause the
Optionee to be considered to have received a Parachute Payment under this Plan
that would have the effect of decreasing the after-tax amount received by the
Optionee as described in clause (ii) of the preceding sentence, then the
Optionee shall have the right, in the Optionee's sole discretion, to designate
those rights, payments, or benefits under this Plan, any Other Agreements, and
any Benefit Arrangements that should be reduced or eliminated so as to avoid
having the payment or benefit to the Optionee under this Plan be deemed to be a
Parachute Payment.
9. SHARE OPTION AGREEMENTS
All Options granted pursuant to the Plan shall be evidenced by Share
Option Agreements, to be executed by the Company and by the Optionee, in such
form or forms as the Board shall from time to time determine. Share Option
Agreements covering Options granted from time to time or at the same time need
not contain similar provisions; provided, however, that all such Option
Agreements shall comply with all terms of the Plan.
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<PAGE> 7
10. OPTION PRICE
The Option Price shall be fixed by the Board and stated in each Share
Option Agreement. The Option Price shall not be less than the Fair Market Value
of the Shares.
11. TERM AND EXERCISE OF OPTIONS
11.1. TERM
Each Option granted under the Plan shall terminate and all
rights to purchase shares thereunder shall cease at such time as may be fixed by
the Board and stated in the Share Option Agreement relating to such Option.
11.2. OPTION PERIOD AND LIMITATIONS ON EXERCISE
Each Option granted under the Plan shall be exercisable, in
whole or in part, at any time and from time to time over a period commencing on
or after the Grant Date and ending upon the expiration or termination of the
Option, as the Board shall determine and set forth in the Share Option Agreement
relating to such Option. Without limiting the foregoing, the Board, subject to
the terms and conditions of the Plan, may in its sole discretion provide that an
Option may not be exercised in whole or in part for a stated period or periods
of time during which such Option is outstanding; provided, however, that any
such limitation on the exercise of an Option contained in any Share Option
Agreement may be rescinded, modified or waived by the Board, in its sole
discretion, at any time and from time to time after the Grant Date of such
Option, so as to accelerate the time at which the Option may be exercised.
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<PAGE> 8
11.3. TERMINATION OF EMPLOYMENT
Upon the termination of the employment of an Optionee with the
Company, a Subsidiary or an Affiliate, other than by reason of the death or
"permanent and total disability" (within the meaning of Section 22(e)(3) of the
Code), any Option granted to an Optionee pursuant to the Plan shall terminate,
and such Optionee shall have no further right to purchase Shares pursuant to
such Option; provided further, that the Board may provide, by inclusion of
appropriate language in any Share Option Agreement, that an Optionee may
(subject to the general limitations on exercise set forth in Section 11.2
above), in the event of termination of employment of the Optionee with the
Company, a Subsidiary or an Affiliate, exercise an Option, in whole or in part,
at any time subsequent to such termination of employment and prior to
termination of the Option pursuant to Section 11.2 above, either subject to or
without regard to any installment limitation on exercise imposed pursuant to
Section 11.2. above, as the Board, in its sole and absolute discretion, shall
determine and set forth in the Share Option Agreement. Whether a leave of
absence or leave on military or government service shall constitute a
termination of employment for purposes of the Plan, shall be determined by the
Board, which determination shall be final and conclusive. For purposes of the
Plan, a termination of employment with the Company, a Subsidiary or an Affiliate
shall not be deemed to occur if the Optionee is immediately thereafter employed
with the Company, any other Subsidiary or any other Affiliate.
11.4. RIGHTS IN THE EVENT OF DEATH
If an Optionee dies while employed by the Company, a Subsidiary
or an Affiliate, the executors or administrators or legatees or distributees of
such Optionee's estate shall have the right (subject to the general limitations
on exercise set forth in Section 11.2 above), at any time within one year after
the date of such Optionee's death and prior to termination of the Option
pursuant to Section 11.1 above, to exercise any Option held by such Optionee at
the date of such Optionee's death, whether or not such Option was exercisable
immediately prior to such Optionee's death; provided, however, that the Board
may provide by inclusion of appropriate language in any Share Option Agreement
that, in the event of the death of an Optionee, the executors or administrators
or legatees or distributees of such Optionee's estate may exercise an Option
(subject to the general limitations on exercise set forth in Section 11.2
above), in whole or in part, at any time subsequent to such Optionee's death and
prior to termination of the Option pursuant to Section 11.1 above, either
subject to or without regard to any installment limitation on exercise imposed
pursuant to Section 11.2 above, as the Board, in its sole and absolute
discretion, shall determine and set forth in the Share Option Agreement.
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<PAGE> 9
11.5. RIGHTS IN THE EVENT OF DISABILITY
If an Optionee terminates employment with the Company, a
Subsidiary or an Affiliate by reason of the "permanent and total disability"
(within the meaning of Section 22(e)(3) of the Code) of such Optionee, then such
Optionee shall have the right (subject to the general limitations on exercise
set forth in Section 11.2 above), at any time within one year after such
termination of employment and prior to termination of the Option pursuant to
Section 11.1 above, to exercise, in whole or in part, any Option held by such
Optionee at the date of such termination of employment, whether or not such
Option was exercisable immediately prior to such termination of employment;
provided, however, that the Board may provide, by inclusion of appropriate
language in any Share Option Agreement, that an Optionee may (subject to the
general limitations on exercise set forth in Section 11.2 above), in the event
of the termination of employment of the Optionee with the Company, a Subsidiary
or an Affiliate by reason of the "permanent and total disability" (within the
meaning of Section 22(e)(3) of the Code) of such Optionee, exercise an Option,
in whole or in part, at any time subsequent to such termination of employment
and prior to termination of the Option pursuant to Section 11.1 above, either
subject to or without regard to any installment limitation on exercise imposed
pursuant to Section 11.2 above, as the Board, in its sole and absolute
discretion, shall determine and set forth in the Share Option Agreement. Whether
a termination of employment is to be considered by reason of "permanent and
total disability" for purposes of this Plan shall be determined by the Board,
which determination shall be final and conclusive.
11.6. LIMITATIONS ON EXERCISE OF OPTION
Notwithstanding the foregoing Sections, in no event may the
Option be exercised, in whole or in part, after the occurrence of an event
referred to in Section 18.3 below which results in termination of the Option. In
no event may the Option be exercised for a fractional Share.
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11.7. METHOD OF EXERCISE
An Option that is exercisable hereunder may be exercised by the
Optionee's delivery to the Company of written notice of the exercise and the
number of Shares for which the Option is being exercised. Such delivery shall
occur on any business day, at the Company's principal office, addressed to the
attention of the Board. Such notice shall specify the number of Shares with
respect to which the Option is being exercised and shall be accompanied by
payment in full of the Option Price of the Shares for which the Option is being
exercised. The minimum number of Shares with respect to which an Option may be
exercised, in whole or in part, at any time shall be the lesser of (i) 100
shares or such lesser number set forth in the applicable Option Agreement and
(ii) the maximum number of Shares available for purchase under the Option at the
time of exercise. Payment of the Option Price for the Shares purchased pursuant
to the exercise of an Option shall be made (i) in cash or in cash equivalents;
(ii) through the tender to the Company of Shares (so long as any Shares so
tendered that were originally acquired by the Optionee from the Company have
been held by the Optionee for at least six (6) months prior to such tender),
which Shares shall be valued, for purposes of determining the extent to which
the Option Price has been paid thereby, at their Fair Market Value on the date
of exercise; or (iii) by a combination of the methods described in (i) and (ii).
The Board may provide, by inclusion of appropriate language in an Share Option
Agreement, an amendment thereto or other agreement with the Optionee, that
payment in full of the Option Price need not accompany the written notice of
exercise provided the notice of exercise directs that the Share certificate or
certificates for the Shares for which the Option is exercised be delivered to a
licensed broker acceptable to the Company as the agent for the individual
exercising the Option and, at the time such Share certificate or certificates
are delivered, the broker tenders to the Company cash (or cash equivalents
acceptable to the Company) equal to the Option Price for the Shares purchased
pursuant to the exercise of the Option plus the amount (if any) of federal
and/or other taxes which the Company may in its judgment, be required to
withhold with respect to the exercise of the Option. An attempt to exercise any
Option granted hereunder other than as set forth above shall be invalid and of
no force and effect. Promptly after the exercise of an Option and the payment in
full of the Option Price of the Shares covered thereby, the individual
exercising the Option shall be entitled to the issuance of a Share certificate
or Share certificates evidencing his or her ownership of such Shares. Unless
otherwise stated in the applicable Share Option Agreement, an individual holding
or exercising an Option shall have none of the rights of a stockholder (for
example, the right to receive cash or dividend payments attributable to the
subject Shares or to direct the voting of the subject Shares) until the Shares
covered thereby are fully paid and issued to him or her. Except as provided in
Section 18 below, no adjustment shall be made for dividends or other rights for
which the record date is prior to the date of such issuance.
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12. GRANT OF RESTRICTED SHARES
12.1. RESTRICTED SHARE AWARDS.
(a) The Board may from time to time, and subject to
the provisions of the Plan and such other terms and conditions as the Board may
determine, grant Restricted Share Awards under the Plan. Each Restricted Share
Award shall be evidenced by a written instrument which shall state the number of
Shares covered by the award and the terms and conditions which the Board shall
have determined with respect to such award, including the number of Shares that
the Holder shall be entitled to purchase, the price to be paid, and the time
within which the Holder must accept such offer, which shall in no event exceed
thirty (30) days from the date upon which the Board made the determination to
grant the Restricted Share Award. Upon the acceptance of each Restricted Share
Award, subject to Section 12.3, a certificate representing the Shares covered by
the award shall be registered in the name of the Holder and shall be delivered
to the Holder. The Holder shall generally have the rights and privileges of a
stockholder of the Company with respect to such Shares, including the right to
vote and to receive dividends, subject to the restrictions specified in
paragraphs (b) and (c).
(b) The Board shall determine a period of time
("Limitation Period") which shall apply to the Shares transferred to a Holder
with respect to each Restricted Shares Award. Except as otherwise determined by
the Board, during the Limitation Period applicable with respect to each
Restricted Shares Award, the Holder may not sell, transfer, assign, pledge or
otherwise encumber or dispose of the Shares covered by such Restricted Shares
Award. The Board in its discretion may prescribe conditions for the incremental
lapse of the preceding restrictions during the Limitation Period, and for the
lapse or termination of such restrictions upon the occurrence of certain events
before the expiration of the Limitation Period. The Board in its discretion also
may shorten or terminate the Limitation Period or waive any conditions for the
lapse or termination of the restrictions with respect to all or any portion of
the Shares covered by the Restricted Shares Award. The certificate representing
the Shares distributed with respect to each Restricted Shares Award made under
the Plan shall be affixed with a legend setting forth the restrictions
applicable to the transfer of such Shares. The restrictions applicable to a
Restricted Shares Award shall lapse and a certificate for the number of Shares
with respect to which the restrictions have lapsed shall be delivered to the
Holder free of all such restrictions upon the earliest of the following: (1) the
expiration of the Limitation Period applicable to the Restricted Shares Award,
(2) the occurrence of an event prescribed by the Board which results in the
lapse of the restrictions, or (3) such other time as the Board may determine.
(c) The Shares covered by a Restricted Share Award
shall be subject to a repurchase option exercisable upon the voluntary or
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involuntary termination of the Holder's employment with the Company for any
reason (including death or disability) during the Limitation Period. The
purchase price for Shares repurchased pursuant to the Restricted Share Agreement
shall be the original price paid by the Holder and may be paid by cancellation
of any indebtedness of the Holder to the Company.
12.2. RESTRICTED SHARE AGREEMENT
All Restricted Share Awards granted pursuant to the Plan shall
be evidenced by Restricted Share Agreements, to be executed by the Company and
by the Holder, in such form or forms as the Board shall from time to time
determine. Restricted Share Agreements covering Restricted Shares granted from
time to time or at the same time need not contain similar provisions; provided,
however, that all such Restricted Share Agreements shall comply with all terms
of the Plan.
12.3. CERTIFICATES FOR RESTRICTED SHARES
The Board may require that the certificates evidencing the
grant of a Restricted Share Award hereunder be held in escrow until such
restrictions have expired. The Board may also cause a legend to be placed on
such certificates that complies with the applicable securities laws and
regulations and makes appropriate reference to the restrictions to which the
Shares are subject. Upon attainment of the specified objectives and requirements
(or, to the extent specified in the grant (or the portion of such Shares earned
by partial attainment of the objectives and requirements, as applicable) free of
restrictions.
13. TRANSFERABILITY OF SHARES AND OPTIONS
During the lifetime of an Optionee, only such Optionee or grantee (or,
in the event of legal incapacity or incompetency, the guardian or legal
representative of the Optionee or grantee) may exercise the Option. No
Restricted Shares shall be assignable or transferable, other than by will or the
laws of descent and distribution, before the satisfaction of applicable
performance and service requirements with respect to such Shares, as set forth
in the applicable Restricted Share Agreement.
14. USE OF PROCEEDS
The proceeds received by the Company from the sale of Shares pursuant
to the exercise of Options granted under the Plan shall constitute general funds
of the Company.
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15. REQUIREMENTS OF LAW
The Company shall not be required to sell or issue any Shares under
any Incentive Award if the sale or issuance of such Shares would constitute a
violation by the Optionee, the Holder, the individual exercising the Option, or
the Company of any provisions 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 Company shall determine, in its discretion, that
the listing, registration or qualification of any Shares subject to the Option
upon any securities exchange or under any governmental 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
Company, and any delay caused thereby shall in no way affect the date of
termination of the Option. Specifically in connection with the 1933 Act, at the
time of grant of Restricted Shares or when such Shares becomes vested or upon
the exercise of any Option, unless a registration statement under such act is in
effect with respect to the Shares covered by Option, the Company shall not be
required to sell or issue such Shares unless the Board has received evidence
satisfactory to it that the holder of such Restricted Shares or Option, may
acquire such Shares pursuant to an exemption from registration under such act.
Any determination in this connection by the Board shall be final, binding, and
conclusive. The Company may, but shall in no event be obligated to, register any
securities covered hereby pursuant to the 1933 Act. The Company shall not be
obligated to take any affirmative action in order to cause the exercise of an
Option or the issuance of Shares pursuant thereto or pursuant to a grant of
Restricted Shares to comply with any law or regulation of any governmental
authority. As to any jurisdiction that expressly imposes the requirement that an
Option shall not be exercisable or that Shares may not be issued pursuant to a
Restricted Share Award unless and until the Shares covered by such grant or
Option are registered or are exempt from registration, the exercise of such
Option or issuance of Shares pursuant to such grant (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.
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<PAGE> 14
16. AMENDMENT AND TERMINATION OF THE PLAN
The Board may, at any time and from time to time, amend, suspend, or
terminate the Plan as to any Shares as to which Incentive Awards have not been
granted. The Company may retain the right in an Agreement to cause a forfeiture
of the Shares or gain realized by a holder of an Incentive Award on account of
the holder taking actions in "competition with the Company," as defined in the
applicable Agreement. Furthermore, the Company may annul the grant of an Option,
or Restricted Shares if the holder of such grant was an employee of the Company
or a Subsidiary and is terminated "for cause," as defined in the applicable
Agreement. Except as permitted under this Section 16 or Section 18 hereof, no
amendment, suspension, or termination of the Plan shall, without the consent of
the holder of the Incentive Award, alter or impair rights or obligations under
any Incentive Award theretofore granted under the Plan.
17. EXCHANGE ACT: RULE 16B-3
17.1. GENERAL
The Plan is intended to comply with Rule 16b-3 ("Rule 16b-3")
under the Exchange Act. Any provision inconsistent with Rule 16b-3 shall, to the
extent permitted by law and determined to be advisable by the Board (constituted
in accordance with Section 17.2 hereof) or the Board (acting pursuant to Section
17.3 hereof), be inoperative and void.
17.2. STOCK OPTION COMMITTEE
The Committee appointed pursuant to Section 3.2 hereof shall
consist of not fewer than two members of the Board each of whom shall qualify
(at the time of appointment to the Committee and during all periods of service
on the Committee) in all respects as a "non-employee director" as defined in
Rule 16b-3.
17.3. ADDITIONAL RESTRICTION ON TRANSFER OF SHARES
No director, officer or other "insider" of the Corporation
subject to Section 16 of the Exchange Act shall be permitted to sell Shares
(which such "insider" had received upon exercise of an Option or under a
Restricted Share Award) during the six months immediately following the grant of
such Option or Restricted Share Award.
18. EFFECT OF CHANGES IN CAPITALIZATION
18.1. CHANGES IN SHARES
If the number of outstanding Shares is increased or decreased
or the Shares are changed into or exchanged for a different number or kind of
Shares or other securities of the Company on account of any recapitalization,
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<PAGE> 15
reclassification, stock split, reverse split, combination of Shares, exchange of
Shares, Share dividend or other distribution payable in capital stock, or other
increase or decrease in such Shares effected without receipt of consideration by
the Company, occurring after the closing of the initial public offering of
Shares of the Company, the number and kinds of Shares for the issuance of which
Restricted Share Awards may be granted and for the acquisition of which Options
may be granted under the Plan shall be adjusted proportionately and accordingly
by the Company. In addition, the number and kind of Shares for which Restricted
Share Awards or Options, are outstanding shall be adjusted proportionately and
accordingly so that the proportionate interest of the holder of the Restricted
Share Awards or Option immediately following such event shall, to the extent
practicable, be the same as immediately before such event. Any such adjustment
in outstanding Options shall not change the aggregate Option Price payable with
respect to Shares that are subject to the unexercised portion of the Option
outstanding but shall include a corresponding proportionate adjustment in the
Option Price per Share.
18.2. REORGANIZATION IN WHICH THE COMPANY IS THE
SURVIVING ENTITY
Subject to Section 18.3 hereof, if the Company shall be the
surviving Entity in any reorganization, merger, or consolidation of the Company
with one or more other entities, any Option theretofore granted pursuant to the
Plan shall pertain to and apply to the securities to which a holder of the
number of Shares subject to such 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. Subject to any contrary language in the applicable
Restricted Share Agreement, any restrictions that were applicable to any
previously granted Restricted Share Award shall apply as well to any replacement
shares received by the Holder as a result of the reorganization, merger, or
consolidation.
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<PAGE> 16
18.3. REORGANIZATION IN WHICH THE COMPANY IS NOT THE
SURVIVING ENTITY OR SALE OF ASSETS OR SHARES
Upon the dissolution or liquidation of the Company, or upon a
merger, consolidation, or reorganization of the Company with one or more other
entities in which the Company is not the surviving entity, or upon a sale of
substantially all of the assets of the Company to another entity, or upon any
transaction (including, without limitation, a merger or reorganization in which
the Company is the surviving entity) approved by the Board that results in any
person or entity (or person or entities acting as a group or otherwise in
concert) owning 80 percent or more of the combined voting power of all classes
of securities of the Company, the Plan and all Options outstanding hereunder
shall terminate, except to the extent provision is made in writing in connection
with such transaction for the continuation of the Plan or the assumption of such
Options theretofore granted, or for the substitution for such Options of new
options covering the stock of a successor Company, or a parent or subsidiary
thereof, with appropriate adjustments as to the number and kinds of shares and
exercise prices, in which event the Plan and Options theretofore granted shall
continue in the manner and under the terms so provided. In the event of any such
termination of the Plan, each individual holding an Option shall have the right
(subject to the general limitations on exercise set forth in Section 11.2
above), immediately before the occurrence of such termination and during such
period occurring before such termination as the Board in its sole discretion
shall determine and designate, to exercise such Option in whole or in part,
whether or not such Option was otherwise exercisable at the time such
termination occurs. The Board shall send written notice of an event that will
result in such a termination to all individuals who hold Options not later than
the time at which the Company gives notice thereof to its stockholders but in no
event less than 30 days before the occurrence of such termination. Unvested
Restricted Share Awards shall be vested in the case of an event described in
this Section 18.3.
18.4. ADJUSTMENTS
Adjustments under this Section 18 related to Shares or
securities of the Company 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.
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<PAGE> 17
18.5. NO LIMITATIONS ON COMPANY
The grant of Shares and Incentive Awards pursuant to the Plan
shall not affect or limit in any way the right or power of the Company to make
adjustments, reclassifications, reorganizations, or changes of its capital or
business structure or to merge, consolidate, dissolve, or liquidate, or to sell
or transfer all or any part of its business or assets.
19. DISCLAIMER OF RIGHTS
No provision in the Plan or in any Incentive Award granted or
Agreement entered into pursuant to the Plan shall be construed to confer upon
any individual the right to remain in the employ or service of the Company, any
Subsidiary or any Affiliate, or to interfere in any way with any contractual or
other right or authority of the Company, any Subsidiary or any Affiliate either
to increase or decrease the compensation or other payments to any individual at
any time, or to terminate any employment or other relationship between any
individual and the Company, a Subsidiary or an Affiliate. In addition,
notwithstanding anything contained in the Plan to the contrary, unless otherwise
stated in the applicable Agreement, no Incentive Award granted under the Plan
shall be affected by any change of duties or position of the Optionee or Holder
(including a transfer to or from the Company, a Subsidiary or an Affiliate), so
long as such Optionee or Holder continued to be a director, officer, consultant,
employee, or independent contractor (as the case may be) of the Company, a
Subsidiary or an Affiliate. The obligation of the Company to pay any benefits
pursuant to this Plan shall be interpreted as a contractual obligation to pay
only those amounts described herein, in the manner and under the conditions
prescribed herein. The Plan shall in no way be interpreted to require the
Company to transfer any amounts to a third party trustee or otherwise hold any
amounts in trust or escrow for payment to any participant or beneficiary under
the terms of the Plan.
20. NONEXCLUSIVITY OF THE PLAN
The adoption of the Plan shall not be construed as creating any
limitations upon the right and authority of the Board to adopt such other
incentive compensation arrangements (which arrangements may be applicable either
generally to a class or classes of individuals or specifically to a particular
individual or particular individuals) as the Board in its discretion determines
desirable, including, without limitation, the granting of restricted shares or
share options otherwise than under the Plan.
21. CAPTIONS
The use of captions in this Plan or any Agreement is for the
convenience of reference only and shall not affect the meaning of any provision
of the Plan or such Agreement.
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22. WITHHOLDING TAXES
22.1. WITHHOLDING
The Company shall have the right to deduct from payments of any
kind otherwise due to an Optionee any Federal, state, or local taxes of any kind
required by law to be withheld with respect to any Shares issued upon the
exercise of an Option under the Plan or with respect to the termination of the
Limitation Period with respect to Restricted Share Awards under the Plan. At the
time of exercise or termination of the Limitation Period, the Optionee or Holder
shall pay to the Company any amount that the Company may reasonably determine to
be necessary to satisfy such withholding obligation. Subject to the prior
approval of the Company, which may be withheld by the Company in its sole
discretion, the Optionee or Holder may elect to satisfy such obligations, in
whole or in part, (i) by causing the Company to withhold Shares otherwise
issuable pursuant to the exercise of an Option or (ii) by delivering to the
Company Shares already owned by the Optionee or Holder. The Shares so delivered
or withheld shall have a fair market value equal to such withholding
obligations. The fair market value of the Shares used to satisfy such
withholding obligation shall be determined by the Company as of the date that
the amount of tax to be withheld is to be determined. An Optionee or Holder who
has made an election pursuant to this Section 24.1 may only satisfy his or her
withholding obligation with Shares that are not subject to any repurchase,
forfeiture, unfulfilled vesting, or other similar requirements.
22.2. LIMITATIONS FOR REPORTING PERSON
Notwithstanding the foregoing, in the case of a Reporting
Person, no election to use Shares for the payment of withholding taxes shall be
effective unless made in compliance with any applicable requirements under Rule
16b-3(e) or any successor rule under the Exchange Act.
23. OTHER PROVISIONS
Each Incentive Award granted under the Plan may contain such other
terms and conditions not inconsistent with the Plan as may be determined by the
Board, in its sole discretion.
24. NUMBER AND GENDER
With respect to words used in this Plan, the singular form shall
include the plural form, the masculine gender shall include the feminine gender,
etc., as the context requires.
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25. SEVERABILITY
If any provision of the Plan or any Agreement shall be determined to
be illegal or unenforceable by any court of law in any jurisdiction, the
remaining provisions hereof and thereof shall be severable and enforceable in
accordance with their terms, and all provisions shall remain enforceable in any
other jurisdiction.
26. GOVERNING LAW
The validity and construction of this Plan and the instruments
evidencing the Incentive Awards granted hereunder shall be governed by the laws
of the State of Maryland.
* * *
The Plan was duly adopted and approved by the Board of Directors of
the Company on the 17th day of February, 1998.
Secretary of the Company
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<PAGE> 1
EXHIBIT 5
HOGAN & HARTSON L.L.P.
111 SOUTH CALVERT STREET
BALTIMORE, MD 21202
February 12, 1999
Guilford Pharmaceuticals Inc.
6611 Tributary Street
Baltimore, Maryland 21224
Ladies and Gentlemen:
This firm has acted as counsel to Guilford Pharmaceuticals Inc., a
Delaware corporation (the "Company"), in connection with its registration,
pursuant to a registration statement on Form S-8 filed on the date hereof (the
"Registration Statement"), of 600,000 shares (the "Shares") of common stock, par
value $.01 per share of the Company (the "Common Stock"), to be granted pursuant
to the Guilford Pharmaceuticals Inc. 1998 Employee Share Option and Restricted
Share Plan (the "Plan"). This letter is furnished to you pursuant to the
requirements of Item 601(b)(5) of Regulation S-K, 17 C.F.R. Section
229.601(b)(5) in connection with such registration.
For purposes of this opinion letter, we have examined copies of the
following documents:
1. The Registration Statement.
2. The Certificate of Incorporation of the Company with amendments
thereto, as certified by the Secretary of State of the State of
Delaware on February 10, 1999, and as certified by the
Assistant Secretary of the Company on the date hereof as being
complete, accurate and in effect.
3. The Bylaws of the Company, as certified by the Assistant
Secretary of the Company on the date hereof as being complete,
accurate and in effect.
4. The Plan as adopted by the Board of Directors of the Company
and as certified by the Assistant Secretary of the Company on
the date hereof as being complete, accurate and in effect.
<PAGE> 2
5. Resolutions of the Board of Directors of the Company adopted on
February 17, 1998, as certified by the Secretary of the Company
on the date hereof as being complete, accurate and in effect,
relating to, among other things, the approval of the Plan and
the filing of the Registration Statement.
6. A certificate of certain officers of the Company, dated the
date hereof, as to certain facts relating to the Company.
In our examination of the aforesaid documents, we have assumed the
genuineness of all signatures, the legal capacity of natural persons, the
authenticity, accuracy and completeness of all documents submitted to us, and
the conformity with the original documents of all documents submitted to us as
certified, telecopied, photostatic, or reproduced copies. 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, and we express no opinion as
to any other laws, statutes, ordinances, rules or regulations (such as state
securities or "blue sky" laws).
Based upon, subject to and limited by the foregoing, we are of the
opinion that the Shares, when issued and delivered in the manner and on the
terms contemplated in the Registration Statement and the Plan (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 non-assessable.
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 filing of the Registration
Statement on the date hereof, and should not be quoted in whole or in part or
otherwise be referred to, nor be 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 an exhibit
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.
Sincerely yours,
HOGAN & HARTSON L.L.P.
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<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
Guilford Pharmaceuticals Inc.
We consent to incorporation by reference in the registration statement on Form
S-8 of Guilford Pharmaceuticals Inc. of our report dated February 13, 1998,
relating to the consolidated balance sheets of Guilford Pharmaceuticals Inc. and
subsidiaries as of December 31, 1997 and 1996, and the related consolidated
statements of operations, shareholders' equity and cash flows for each of the
years in the three-year period ended December 31, 1997, which report appears
in the December 31, 1997 annual report on Form 10-K of Guilford
Pharmaceuticals Inc.
/s/ KPMG LLP
Wilmington, Delaware
February 10, 1999
