UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. )*
PHARMACYCLICS, INC.
-----------------------------------
(Name of Issuer)
Common Stock, $0.0001 Par Value
--------------------------------------------
(Title of Class of Securities)
716933106
---------------------
(CUSIP Number)
Stephen M. Vine, Esq.
Akin, Gump, Strauss, Hauer & Feld, L.L.P.
399 Park Avenue
New York, New York 10022
(212) 872-1000
--------------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
February 21, 1997
-------------------------------------
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [_].
Check the following box if a fee is being paid with the statement [_].** (A fee
is not required only if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7)
Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d- 1(a) for other parties to whom copies are to be
sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter disclosure
provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Continued on following page(s)
Page 1 of 34 Pages
Exhibit Index: Page 17
- -----------------
** A filing fee is not being paid with this statement pursuant to SEC
Release No. 33-7331 whereby the filing fee has been eliminated for
Schedule 13D.
<PAGE>
Page 2 of 34 Pages
SCHEDULE 13D
CUSIP No. 716933106
1 Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
QUANTUM INDUSTRIAL PARTNERS LDC
2 Check the Appropriate Box If a Member of a Group*
a. [_]
b. [x]
3 SEC Use Only
4 Source of Funds*
WC
5 Check Box If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) [_]
6 Citizenship or Place of Organization
Cayman Islands
7 Sole Voting Power
Number of 600,000
Shares
Beneficially 8 Shared Voting Power
Owned By 0
Each
Reporting 9 Sole Dispositive Power
Person 600,000
With
10 Shared Dispositive Power
0
11 Aggregate Amount Beneficially Owned by Each Reporting Person
600,000
12 Check Box If the Aggregate Amount in Row (11) Excludes Certain Shares*
[x]
13 Percent of Class Represented By Amount in Row (11)
5.99%
14 Type of Reporting Person*
OO; IV
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
Page 3 of 34 Pages
SCHEDULE 13D
CUSIP No. 716933106
1 Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
QIH MANAGEMENT INVESTOR, L.P.
2 Check the Appropriate Box If a Member of a Group*
a. [_]
b. [x]
3 SEC Use Only
4 Source of Funds*
AF
5 Check Box If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) [_]
6 Citizenship or Place of Organization
Delaware
7 Sole Voting Power
Number of 600,000
Shares
Beneficially 8 Shared Voting Power
Owned By 0
Each
Reporting 9 Sole Dispositive Power
Person 600,000
With
10 Shared Dispositive Power
0
11 Aggregate Amount Beneficially Owned by Each Reporting Person
600,000
12 Check Box If the Aggregate Amount in Row (11) Excludes Certain Shares*
[x]
13 Percent of Class Represented By Amount in Row (11)
5.99%
14 Type of Reporting Person*
PN; IA
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
Page 4 of 34 Pages
SCHEDULE 13D
CUSIP No. 716933106
1 Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
QIH MANAGEMENT, INC.
2 Check the Appropriate Box If a Member of a Group*
a. [_]
b. [x]
3 SEC Use Only
4 Source of Funds*
AF
5 Check Box If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) [_]
6 Citizenship or Place of Organization
Delaware
7 Sole Voting Power
Number of 600,000
Shares
Beneficially 8 Shared Voting Power
Owned By 0
Each
Reporting 9 Sole Dispositive Power
Person 600,000
With
10 Shared Dispositive Power
0
11 Aggregate Amount Beneficially Owned by Each Reporting Person
600,000
12 Check Box If the Aggregate Amount in Row (11) Excludes Certain Shares*
[x]
13 Percent of Class Represented By Amount in Row (11)
5.99%
14 Type of Reporting Person*
CO
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
Page 5 of 34 Pages
SCHEDULE 13D
CUSIP No. 716933106
1 Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
SOROS FUND MANAGEMENT LLC
2 Check the Appropriate Box If a Member of a Group*
a. [_]
b. [x]
3 SEC Use Only
4 Source of Funds*
AF
5 Check Box If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) [_]
6 Citizenship or Place of Organization
Delaware
7 Sole Voting Power
Number of 600,000
Shares
Beneficially 8 Shared Voting Power
Owned By 0
Each
Reporting 9 Sole Dispositive Power
Person 600,000
With
10 Shared Dispositive Power
0
11 Aggregate Amount Beneficially Owned by Each Reporting Person
624,500\1\
12 Check Box If the Aggregate Amount in Row (11) Excludes Certain Shares*
[_]
13 Percent of Class Represented By Amount in Row (11)
6.24%
14 Type of Reporting Person*
OO; IA
*SEE INSTRUCTIONS BEFORE FILLING OUT!
- -------------------
\1\ See Item 5.
<PAGE>
Page 6 of 34 Pages
SCHEDULE 13D
CUSIP No. 716933106
1 Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
GEORGE SOROS (in the capacity described herein)
2 Check the Appropriate Box If a Member of a Group*
a. [_]
b. [x]
3 SEC Use Only
4 Source of Funds*
AF
5 Check Box If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) [_]
6 Citizenship or Place of Organization
United States
7 Sole Voting Power
Number of 0
Shares
Beneficially 8 Shared Voting Power
Owned By 600,000
Each
Reporting 9 Sole Dispositive Power
Person 0
With
10 Shared Dispositive Power
600,000
11 Aggregate Amount Beneficially Owned by Each Reporting Person
624,500\1\
12 Check Box If the Aggregate Amount in Row (11) Excludes Certain Shares*
[_]
13 Percent of Class Represented By Amount in Row (11)
6.24%
14 Type of Reporting Person*
IA
*SEE INSTRUCTIONS BEFORE FILLING OUT!
- -------------------
\1\ See Item 5.
<PAGE>
Page 7 of 34 Pages
SCHEDULE 13D
CUSIP No. 716933106
1 Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
STANLEY F. DRUCKENMILLER (in the capacity described herein)
2 Check the Appropriate Box If a Member of a Group*
a. [_]
b. [x]
3 SEC Use Only
4 Source of Funds*
AF
5 Check Box If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) [_]
6 Citizenship or Place of Organization
United States
7 Sole Voting Power
Number of 0
Shares
Beneficially 8 Shared Voting Power
Owned By 600,000
Each
Reporting 9 Sole Dispositive Power
Person 0
With
10 Shared Dispositive Power
600,000
11 Aggregate Amount Beneficially Owned by Each Reporting Person
624,500\1\
12 Check Box If the Aggregate Amount in Row (11) Excludes Certain Shares*
[_]
13 Percent of Class Represented By Amount in Row (11)
6.24%
14 Type of Reporting Person*
IA
*SEE INSTRUCTIONS BEFORE FILLING OUT!
- -------------------
\1\ See Item 5.
<PAGE>
Page 8 of 34 Pages
This Statement on Schedule 13D relates to shares of Common Stock,
$0.0001 par value per share (the "Shares"), of Pharmacyclics, Inc. (the
"Issuer"). This Statement is being filed by the Reporting Persons (as defined
herein) to report a recent acquisition of Shares of the Issuer as a result of
which the Reporting Persons may be deemed to be the beneficial owners of more
than 5% of the outstanding Shares.
Item 1. Security and Issuer.
This Statement relates to the Shares. The address of the
principal executive office of the Issuer is 995 East Arques Avenue, Sunnyvale,
California 94086-4521. .
Item 2. Identity and Background.
This Statement is being filed on behalf of each of the following persons
(collectively, the "Reporting Persons"):
i) Quantum Industrial Partners LDC ("QIP");
ii) QIH Management Investor, L.P. ("QIHMI");
iii) QIH Management, Inc. ("QIH Management");
iv) Soros Fund Management LLC ("SFM LLC");
v) Mr. George Soros ("Mr. Soros"); and
vi) Mr. Stanley F. Druckenmiller ("Mr. Druckenmiller").
This Statement relates to the Shares held for the accounts of QIP
and Quasar International Partners C.V., a Netherlands Antilles limited
partnership ("Quasar Partners").
The Reporting Persons
QIP, QIHMI and QIH Management
- -----------------------------
QIP is a Cayman Islands exempted limited duration company with
its principal address at Kaya Flamboyan 9, Willemstad, Curacao, Netherlands
Antilles. The principal business of QIP is investment in securities. Current
information concerning the identity and background of the directors and officers
of QIP is set forth in Annex A hereto, which is incorporated by reference in
response to this Item 2.
QIHMI, an investment advisory firm organized as a Delaware
limited partnership, is a minority shareholder of, and (pursuant to constituent
documents of QIP) is vested with investment discretion with respect to the
portfolio assets held for the account of, QIP. The principal business of QIHMI
is to provide management and advisory services to, and to invest in, QIP. QIH
Management, a Delaware corporation of which Mr. Soros is the sole shareholder,
is the sole general partner of QIHMI. The principal business of QIH Management
<PAGE>
Page 9 of 34 Pages
is to serve as the sole general partner of QIHMI. Current information concerning
the identity and background of the directors and officers of QIH Management is
set forth in Annex A hereto, which is incorporated by reference in response to
this Item 2. QIHMI and QIH Management have their principal offices at 888
Seventh Avenue, 33rd Floor, New York, New York 10106. QIHMI, by reason of its
investment discretion over the securities owned by QIP, and QIH Management, as
the sole general partner of QIHMI, may each be deemed the beneficial owner of
the Shares held for the account of QIP for purposes of Section 13(d) of the
Securities Exchange Act of 1934, as amended (the "Act").
Mr. Soros has entered into an agreement dated as of January 1,
1997 with SFM LLC pursuant to which Mr. Soros has, among other things, agreed to
use his best efforts to cause QIH Management, as the general partner of QIHMI,
to act at the direction of SFM LLC, which agreement to so act shall terminate
upon the earlier of (a) the assignment to SFM LLC of the legal and beneficial
ownership interest in QIH Management and (b) the assignment to SFM LLC of the
general partnership interest in QIHMI (the "QIP Contract").
SFM LLC, Mr. Soros and Mr. Druckenmiller
- ----------------------------------------
The business of SFM LLC is managed through a Management Committee
(the "Management Committee") comprised of Mr. Soros, Mr. Druckenmiller and Mr.
Gary Gladstein. SFM LLC, a Delaware limited liability company, has its principal
office at 888 Seventh Avenue, 33rd Floor, New York, New York 10106. Its
principal business is to serve, pursuant to contract, as the principal
investment manager to several foreign investment companies, including Quasar
Partners (the "SFM Clients"). SFM LLC has been granted investment discretion
over portfolio investments, including the Shares, held for the account of Quasar
Partners. Quasar Partners has its principal office at Kaya Flamboyan 9,
Willemstad, Curacao, Netherlands Antilles. SFM LLC's contracts with the SFM
Clients generally provide that SFM LLC is responsible for designing and
implementing the SFM Clients' overall investment strategies; for conducting
direct portfolio management strategies to the extent that SFM LLC determines
that it is appropriate to utilize its own portfolio management capabilities; for
selecting, evaluating and monitoring other investment advisors who manage
separate portfolios on behalf of the SFM Clients; and for allocating and
reallocating the SFM Clients' assets among the outside managers and itself.
Mr. Soros, as Chairman of SFM LLC, has the ability to direct the
investment decisions of SFM LLC and as such may be deemed to have investment
discretion over the Shares held for the account of Quasar Partners. Mr.
Druckenmiller, as Lead Portfolio Manager of SFM LLC, has the ability to direct
the investment decisions of SFM LLC and as such may be deemed to have investment
discretion over the Shares held for the account of Quasar Partners. Set forth in
Annex A hereto and incorporated by reference in response to this Item 2 and
elsewhere in this Schedule 13D as applicable is a list of the Managing Directors
of SFM LLC (the executive officers of SFM LLC).
The principal occupation of Mr. Soros, a United States citizen,
is his direction of the activities of SFM LLC, which is carried out in his
capacity as Chairman of SFM LLC at SFM LLC's principal office.
The principal occupation of Mr. Druckenmiller, a United States
citizen, is his position as Lead Portfolio Manager and a Member of the
Management Committee of SFM LLC, which is carried out at SFM LLC's principal
office.
Pursuant to regulations promulgated under Section 13(d) of the
Act, SFM LLC, Mr. Soros, in his capacity as Chairman of SFM LLC, and Mr.
<PAGE>
Page 10 of 34 Pages
Druckenmiller, in his capacity as Lead Portfolio Manager of SFM LLC, each may be
deemed a beneficial owner of the Shares held for the account of Quasar Partners
as a result of the contractual authority of SFM LLC to exercise voting and
dispositive power with respect to such Shares.
Pursuant to regulations promulgated under Section 13(d) of the
Act, SFM LLC, pursuant to the provisions of the QIP Contract, Mr. Soros, in his
capacity as Chairman of SFM LLC, and Mr. Druckenmiller, in his capacity as Lead
Portfolio Manager of SFM LLC, each may be deemed a beneficial owner of the
Shares held for the account of QIP.
During the past five years, none of the Reporting Persons, Quasar
Partners and, to the best of the Reporting Persons' knowledge, any other person
identified in response to this Item 2 has been (a) convicted in a criminal
proceeding, or (b) a party to any civil proceeding as a result of which he has
been subject to a judgment, decree or final order enjoining future violations
of, or prohibiting or mandating activities subject to, federal or state
securities laws, or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
On February 21, 1997, QIP entered into a Common Stock Purchase
Agreement (the "Purchase Agreement") with the Issuer, a copy of the form of
which is attached hereto as Exhibit E and incorporated herein by reference in
response to this Item 3, pursuant to which QIP expended $11,430,000 of its
working capital to purchase 600,000 Shares.
The Shares held for the accounts of QIP, Quasar Partners and/or
other SFM Clients may be held through margin accounts maintained with brokers,
which extend margin credit as and when required to open or carry positions in
their margin accounts, subject to applicable federal margin regulations, stock
exchange rules and such firms' credit policies. The Shares which may be held in
the margin accounts are pledged as collateral security for the repayment of
debit balances in the respective accounts.
Item 4. Purpose of Transaction.
All of the Shares reported herein as having been acquired for or
disposed of from the accounts of QIP and/or Quasar Partners were acquired or
disposed of for investment purposes. Neither Quasar Partners, the Reporting
Persons nor, to the best of their knowledge, any of the other persons identified
in response to Item 2, has any plans or proposals that relate to or would result
in any of the transactions described in subparagraphs (a) through (j) of Item 4
of Schedule 13D.
SFM LLC, Mr. Soros and Mr. Druckenmiller reserve the right to
acquire, or cause to be acquired, additional securities of the Issuer, to
dispose of, or cause to be disposed, such securities at any time or to formulate
other purposes, plans or proposals regarding the Issuer or any of its
securities, to the extent deemed advisable in light of general investment and
trading policies of the Reporting Persons and/or SFM Clients, market conditions
or other factors.
Item 5. Interest in Securities of the Issuer.
(a) (i) Each of QIP, QIHMI and QIH Management may be deemed the
beneficial owner of the 600,000 Shares held for the account of QIP
(approximately 5.99% of the total number of Shares outstanding).
<PAGE>
Page 11 of 34 Pages
(ii) Each of SFM LLC, Mr. Soros and Mr. Druckenmiller may be
deemed the beneficial owners of 624,500 Shares (approximately 6.24% of the total
number of Shares outstanding). This number includes (A) 600,000 Shares held for
the account of QIP and (B) 24,500 Shares held for the account of Quasar
Partners. Quasar Partners previously entered into an investment advisory
contract with Oracle Investment Management, Inc. ("OIM") pursuant to which OIM
was granted investment discretion over certain funds of Quasar Partners (the
"OIM Contract"). The 24,500 Shares held for the account of Quasar Partners were
acquired at the direction of OIM pursuant to the OIM Contract. As a consequence
of SFM LLC's ability to terminate the OIM Contract with respect to all
investments, including those involving the Shares, and acquire voting and
dispositive power over the Shares within 60 days, notwithstanding the fact that
none of SFM LLC, Mr. Soros and Mr. Druckenmiller currently exercises such power,
SFM LLC, Mr. Soros and Mr. Druckenmiller may be deemed the beneficial owner of
the Shares held for the account of Quasar Partners at OIM.
(b) (i) Each of QIP, QIHMI, QIH Management and SFM LLC (by virtue
of the QIP contract) may be deemed to have the sole power to direct the voting
and disposition of the 600,000 Shares held for the account of QIP.
(ii) By virtue of the QIP Contract and as a result of their
positions with SFM LLC, each of Mr. Soros and Mr. Druckenmiller may be deemed to
have shared power to direct the voting and disposition of the 600,000 Shares
held for the account of QIP.
(iii) OIM is currently vested with sole power to direct the
voting and disposition of the 24,500 Shares held for the account Quasar Partners
as a result of the OIM Contract. SFM LLC has the contractual authority on behalf
of Quasar Partners to terminate the OIM Contract within 60 days and, as a
result, SFM LLC, Mr. Soros and Mr. Druckenmiller may be deemed to have the
ability to acquire the voting and dispositive power held by OIM with respect to
the 24,500 Shares.
(c) Except for the transaction described in Item 3 and Item 6 in
which QIP purchased 600,000 Shares at a price of $19.05 per Share, which was
effected at the direction of SFM LLC pursuant to the Purchase Agreement entered
into with the Issuer, there have been no transactions effected with respect to
the Shares since December 30, 1996 (60 days prior to the date hereof) by any of
the Reporting Persons or Quasar Partners.
(d) (i) The shareholders of QIP, including Quantum Industrial
Holdings, Ltd., a British Virgin Islands international business company, have
the right to participate in the receipt of dividends from, or proceeds from the
sale of, the Shares held for the account of QIP in accordance with their
ownership interests in QIP.
(ii) The partners of Quasar Partners, including Quasar
International Fund N.V., a Netherland Antilles corporation, have the right to
participate in the receipt of dividends from, or proceeds from the sale of, the
Shares, held for the account of Quasar Partners in accordance with their
partnership interests in Quasar Partners.
(e) Not applicable.
<PAGE>
Page 12 of 34 Pages
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer.
In connection with its acquisition of the Shares reported herein,
QIP entered into the Purchase Agreement which is incorporated herein by
reference. The description of the terms of the Purchase Agreement below is
qualified in its entirety by reference to the specific provisions of such
agreement.
Pursuant to the terms of the Purchase Agreement, QIP agreed not
to sell or otherwise transfer the Shares purchased thereunder except in a
transaction registered under the Securities Act, unless an exemption from such
registration is available.
Section 7.2 of the Purchase Agreement provides that the Issuer
shall file with the Commission a registration statement on Form S-3 covering all
of the Shares issued and sold to QIP pursuant to the Purchase Agreement within
thirty (30) days after the Closing (as defined in the Purchase Agreement) and
shall use its best efforts to cause such registration statement to become
effective as soon as practicable thereafter. Section 7.2 further provides that
the Issuer has the right, for a period not to exceed thirty (30) days in
duration and upon written notice to QIP, to prohibit the sale of the Shares sold
to QIP pursuant to such registration statement effected under Section 7.2, in
certain circumstances described therein. Provisions regarding the Issuer's
obligations to maintain the effectiveness of such registration statement are
also described in Section 7.2.
From time to time, each of the Reporting Persons, Quasar Partners
and/or the other SFM Clients may lend portfolio securities to brokers, banks or
other financial institutions. These loans typically obligate the borrower to
return the securities, or an equal amount of securities of the same class, to
the lender and typically provide that the borrower is entitled to exercise
voting rights and to retain dividends during the term of the loan. From time to
time, to the extent permitted by applicable law, each of such persons or
entities may borrow Shares for the purpose of effecting, and may effect, short
sale transactions, and may purchase securities for the purpose of closing out
short positions in such securities.
Except as described above, the Reporting Persons, Quasar Partners
and/or the other SFM Clients do not have any contracts, arrangements,
understandings or relationships with respect to any securities of the Issuer.
Item 7. Material to be Filed as Exhibits.
A. Power of Attorney dated as of January 1, 1997 granted by Mr.
Soros in favor of Mr. Sean C. Warren and Mr. Michael C. Neus.
B. Power of Attorney dated as of January 1, 1997 granted by Mr.
Druckenmiller in favor of Mr. Sean C. Warren and Mr. Michael C. Neus.
C. Joint Filing Agreement dated February 28, 1997 by and among
QIP, QIHMI, QIH Management, SFM LLC, Mr. Soros and Mr. Druckenmiller.
D. Power of Attorney dated May 23, 1996 granted by QIP in favor
of Mr. Gary Gladstein, Mr. Sean Warren and Mr. Michael Neus.
E. Form of Purchase Agreement entered into between the Issuer and
QIP.
<PAGE>
Page 13 of 34 Pages
SIGNATURES
After reasonable inquiry and to the best of my knowledge and belief,
the undersigned certifies that the information set forth in this Statement is
true, complete and correct.
Date: February 28, 1997 QUANTUM INDUSTRIAL PARTNERS LDC
By: /S/ MICHAEL C. NEUS
---------------------------------------
Michael C. Neus
Attorney-in-Fact
QIH MANAGEMENT INVESTOR, L.P.
By: QIH Management, Inc.,
its General Partner
By: /S/ MICHAEL C. NEUS
----------------------------------
Michael C. Neus
Vice President
QIH MANAGEMENT, INC.
By: /S/ MICHAEL C. NEUS
---------------------------------------
Michael C. Neus
Vice President
SOROS FUND MANAGEMENT LLC
By: /S/ MICHAEL C. NEUS
---------------------------------------
Michael C. Neus
Assistant General Counsel
GEORGE SOROS
By: /S/ MICHAEL C. NEUS
---------------------------------------
Michael C. Neus
Attorney-in-Fact
<PAGE>
Page 14 of 34 Pages
STANLEY F. DRUCKENMILLER
By: /S/ MICHAEL C. NEUS
---------------------------------------
Michael C. Neus
Attorney-in-Fact
<PAGE>
Page 15 of 34 Pages
ANNEX A
Directors and Officers of Quantum Industrial Partners LDC
Name/Title/Citizenship Principal Occupation Business Address
- ---------------------- -------------------- ----------------
Curacao Corporation Managing Director of Kaya Flamboyan 9
Company N.V. Netherlands Antilles Willemstad
Managing Director corporations Curacao,
(Netherlands Antilles) Netherland Antilles
Inter Caribbean Services Administrative services Citco Building
Limited Wickhams Cay
Secretary Road Town
(British Virgin Islands) Tortola
British Virgin Islands
Directors and Officers of QIH Management, Inc.
Name/Title/Citizenship Principal Occupation Business Address
- ---------------------- -------------------- ----------------
Gary Gladstein Managing Director of 888 Seventh Avenue
Director and President SFM LLC 33rd Floor
(United States) New York, NY 10106
Sean C. Warren Managing Director of 888 Seventh Avenue
Director, Vice President SFM LLC 33rd Floor
and Secretary New York, NY 10106
(United States)
Peter Streinger Chief Financial Officer 888 Seventh Avenue
Treasurer SFM LLC 33rd Floor
(United States) New York, NY 10106
Michael C. Neus Assistant General Counsel 888 Seventh Avenue
Vice President and SFM LLC 33rd Floor
Assistant Secretary New York, NY 10106
(United States)
To the best of the Reporting Persons' knowledge:
(a) None of the above persons holds any Shares.
(b) None of the above persons has any contracts, arrangements,
understandings or relationships with respect to the Shares.
<PAGE>
Page 16 of 34 Pages
ANNEX B
The following is a list of all of the persons (other than Stanley
Druckenmiller) who serve as Managing Directors of SFM LLC:
Scott K. H. Bessent
Walter Burlock
Brian J. Corvese
Jeffrey L. Feinberg
Arminio Fraga
Gary Gladstein
Robert K. Jermain
David N. Kowitz
Alexander C. McAree
Paul McNulty
Gabriel S. Nechamkin
Steven Okin
Dale Precoda
Lief D. Rosenblatt
Mark D. Sonnino
Filiberto H. Verticelli
Sean C. Warren
Each of the above-listed persons is a United States citizen whose principal
occupation is serving as Managing Director of SFM LLC, and each has a business
address c/o Soros Fund Management LLC, 888 Seventh Avenue, 33rd Floor, New York,
New York 10106.
To the best of the Reporting Persons' knowledge:
(a) None of the above persons holds any Shares.
(b) None of the above persons has any contracts, arrangements,
understandings or relationships with respect to the Shares.
<PAGE>
Page 17 of 34 Pages
EXHIBIT INDEX
Page No.
--------
A. Power of Attorney dated as of January 1, 1997 granted by Mr.
George Soros in favor of Mr. Sean C. Warren and Mr. Michael
C. Neus.............................................................. 18
B. Power of Attorney dated as of January 1, 1997 granted by Mr.
Stanley F. Druckenmiller in favor of Mr. Sean C. Warren and
Mr. Michael C. Neus.................................................. 19
C. Joint Filing Agreement dated February 28, 1997 by and among
Quantum Industrial Partners LDC, QIH Management Investor,
L.P., QIH Management, Inc., Soros Fund Management LLC, Mr.
George Soros and Mr. Stanley F. Druckenmiller . ..................... 20
D. Power of Attorney dated May 23, 1996 granted by Quantum
Industrial Partners LDC in favor of Mr. Gary Gladstein, Mr.
Sean Warren and Mr. Michael Neus..................................... 22
E. Form of Common Stock Purchase Agreement entered into between
Pharmacyclics, Inc. and Quantum Industrial Partners
LDC.................................................................. 23
Page 18 of 34 Pages
EXHIBIT A
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, GEORGE SOROS, hereby make, constitute
and appoint each of SEAN C. WARREN and MICHAEL C. NEUS, acting individually, as
my agent and attorney-in-fact for the purpose of executing in my name, (a) in my
personal capacity or (b) in my capacity as Chairman of, member of or in other
capacities with Soros Fund Management LLC, all documents, certificates,
instruments, statements, filings and agreements ("documents") to be filed with
or delivered to any foreign or domestic governmental or regulatory body or
required or requested by any other person or entity pursuant to any legal or
regulatory requirement relating to the acquisition, ownership, management or
disposition of securities or other investments, and any other documents relating
or ancillary thereto, including but not limited to, all documents relating to
filings with the United States Securities and Exchange Commission (the "SEC")
pursuant to the Securities Act of 1933 or the Securities Exchange Act of 1934
(the "Act") and the rules and regulations promulgated thereunder, including: (1)
all documents relating to the beneficial ownership of securities required to be
filed with the SEC pursuant to Section 13(d) or Section 16(a) of the Act
including, without limitation: (a) any acquisition statements on Schedule 13D or
Schedule 13G and any amendments thereto, (b) any joint filing agreements
pursuant to Rule 13d-1(f) and (c) any initial statements of, or statements of
changes in, beneficial ownership of securities on Form 3, Form 4 or Form 5 and
(2) any information statements on Form 13F required to be filed with the SEC
pursuant to Section 13(f) of the Act.
All past acts of the attorney-in-fact in furtherance of the foregoing are hereby
ratified and confirmed.
This power of attorney shall be valid from the date hereof until revoked by me.
IN WITNESS WHEREOF, I have executed this instrument as of the 1st day of
January, 1997.
/s/ George Soros
---------------------------------------
GEORGE SOROS
Page 19 of 34 Pages
EXHIBIT B
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, STANLEY F. DRUCKENMILLER, hereby make,
constitute and appoint each of SEAN C. WARREN and MICHAEL C. NEUS, acting
individually, as my agent and attorney-in-fact for the purpose of executing in
my name, (a) in my personal capacity or (b) in my capacity as Lead Portfolio
Manager of, member of or in other capacities with Soros Fund Management LLC, all
documents, certificates, instruments, statements, filings and agreements
("documents") to be filed with or delivered to any foreign or domestic
governmental or regulatory body or required or requested by any other person or
entity pursuant to any legal or regulatory requirement relating to the
acquisition, ownership, management or disposition of securities or other
investments, and any other documents relating or ancillary thereto, including
but not limited to, all documents relating to filings with the United States
Securities and Exchange Commission (the "SEC") pursuant to the Securities Act of
1933 or the Securities Exchange Act of 1934 (the "Act") and the rules and
regulations promulgated thereunder, including: (1) all documents relating to the
beneficial ownership of securities required to be filed with the SEC pursuant to
Section 13(d) or Section 16(a) of the Act including, without limitation: (a) any
acquisition statements on Schedule 13D or Schedule 13G and any amendments
thereto, (b) any joint filing agreements pursuant to Rule 13d-1(f) and (c) any
initial statements of, or statements of changes in, beneficial ownership of
securities on Form 3, Form 4 or Form 5 and (2) any information statements on
Form 13F required to be filed with the SEC pursuant to Section 13(f) of the Act.
All past acts of the attorney-in-fact in furtherance of the foregoing are hereby
ratified and confirmed.
This power of attorney shall be valid from the date hereof until revoked by me.
IN WITNESS WHEREOF, I have executed this instrument as of the 1st day of
January, 1997.
/s/ Stanley F. Druckenmiller
----------------------------------
STANLEY F. DRUCKENMILLER
Page 20 of 34 Pages
EXHIBIT C
JOINT FILING AGREEMENT
The undersigned hereby agree that the statement on Schedule 13D
with respect to the Common Stock of Pharmacyclics, Inc. dated February 28, 1997
is, and any amendments thereto signed by each of the undersigned shall be, filed
on behalf of each of us pursuant to and in accordance with the provisions of
Rule 13d- 1(f) under the Securities Exchange Act of 1934.
Date: February 28, 1997 QUANTUM INDUSTRIAL PARTNERS LDC
By: /S/ MICHAEL C. NEUS
---------------------------------------
Michael C. Neus
Attorney-in-Fact
QIH MANAGEMENT INVESTOR, L.P.
By: QIH Management, Inc.,
its General Partner
By: /S/ MICHAEL C. NEUS
----------------------------------
Michael C. Neus
Vice President
QIH MANAGEMENT, INC.
By: /S/ MICHAEL C. NEUS
---------------------------------------
Michael C. Neus
Vice President
SOROS FUND MANAGEMENT LLC
By: /S/ MICHAEL C. NEUS
---------------------------------------
Michael C. Neus
Assistant General Counsel
GEORGE SOROS
By: /S/ MICHAEL C. NEUS
---------------------------------------
Michael C. Neus
Attorney-in-Fact
<PAGE>
Page 21 of 34 Pages
STANLEY F. DRUCKENMILLER
By: /S/ MICHAEL C. NEUS
---------------------------------------
Michael C. Neus
Attorney-in-Fact
Page 22 of 34 Pages
EXHIBIT D
QUANTUM INDUSTRIAL PARTNERS LDC
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENT, that the undersigned QUANTUM INDUSTRIAL PARTNERS
LDC (the "Company"), an exempted limited duration company existing and operating
under the laws of the Cayman Islands does, pursuant to a duly adopted resolution
of its Managing Director, hereby designate, constitute and appoint:
GARY GLADSTEIN, SEAN WARREN and MICHAEL NEUS
acting, singly and not jointly, as its true and lawful agent and attorney in
fact for the purpose of executing in its name, all documents, certificates,
instruments, statements, filings and agreements ("documents") to be filed with
or delivered to any foreign or domestic governmental or regulatory body or
required or requested by any other person or entity pursuant to any legal or
regulatory requirement relating to the acquisition, ownership, management or
disposition of securities or other investments, and any other documents relating
or ancillary thereto, including but not limited to, all documents relating to
filings with the United States Securities and Exchange Commission (the "SEC")
pursuant to the Securities Act of 1933 or the Securities Exchange Act of 1934
(the "Act") and the rules and regulations promulgated thereunder, including: (1)
all documents relating to the beneficial ownership of securities required to be
filed with the SEC pursuant to Section 13(d) or Section 16(a) of the Act
including, without limitation: (a) any acquisition statements on Schedule 13D or
Schedule 13G and any amendments thereto, (b) any joint filing agreements
pursuant to Rule 13d-1(f) and (c) any initial statements of, or statements of
changes in, beneficial ownership of securities on Form 3, Form 4 or Form 5 and
(2) any information statements on Form 13F required to be filed with the SEC
pursuant to Section 13(f) of the Act.
Each attorney-in-fact is hereby authorized and empowered to perform all other
acts and deeds, which he or she in his or her sole discretion deems necessary or
appropriate to carry out to the fullest extent the terms and the intent of the
foregoing. All prior acts of each attorney-in-fact in furtherance of the
foregoing are hereby ratified and confirmed.
IN WITNESS WHEREOF, the Company has caused this document to be execute this 23rd
day of May, 1996.
QUANTUM INDUSTRIAL PARTNERS LDC
-----------------------------------
Curacao Corporation Company N.V.
Managing Director
Page 23 of 34 Pages
EXHIBIT E
PHARMACYCLICS, INC.
COMMON STOCK PURCHASE AGREEMENT
This Common Stock Purchase Agreement (the "Agreement") is made as
of February 21, 1997, by and among Pharmacyclics, Inc., a Delaware corporation
(the "Company") with its principal office at 995 East Arques Avenue, Sunnyvale,
California 94086, and the persons listed on the Schedule of Purchasers attached
hereto as Schedule I (the "Purchasers").
----------
1. Authorization and Sale of Units.
-------------------------------
1.1 Authorization. The Company has authorized the issuance and
-------------
sale pursuant to this Agreement of Eight Hundred Sixty Two Thousand Four Hundred
Sixty Eight (862,468) shares of the Common Stock, par value $0.0001 per share
(the "Common Stock"), of the Company.
1.2 Sale of Common Stock. Subject to the terms and conditions of
--------------------
this Agreement, the Company agrees to issue and sell to each Purchaser, and each
Purchaser severally agrees to purchase from the Company, the number of shares of
Common Stock set forth opposite each Purchaser's name on Schedule I for a price
----------
per share equal to $19.05.
2. Closing Date; Delivery.
----------------------
2.1 Closing Date. The closing of the purchase and sale of the
-------------
shares of Common Stock (the "Closing") shall be held at the offices of Brobeck,
Phleger & Harrison LLP, Two Embarcadero Place, 2200 Geng Road, Palo Alto,
California at 10:00 a.m. Pacific Standard Time, on February 21, 1997 or at such
other time and place upon which the Company and the Purchasers purchasing in the
aggregate more than half of the shares of Common Stock sold hereunder shall
agree. The date of the Closing is hereinafter referred to as the "Closing Date."
2.2 Delivery. At the Closing, the Company will deliver to each
--------
Purchaser certificates, registered in the Purchaser's name as shown on Schedule
--------
I, representing the number of shares of Common Stock to be purchased by each
- -
such Purchaser. Such delivery shall be against payment by each Purchaser of the
aggregate purchase price therefor (the "Purchase Price") by wire transfer to the
Company's bank account. The Purchase Price payable by each Purchaser shall be as
set forth on Schedule I opposite each Purchaser's name.
----------
3. Representations and Warranties of the Company. The Company
-----------------------------------------------
represents and warrants to the Purchasers as of the Closing Date as follows:
3.1 Organization and Standing. The Company is a corporation duly
-------------------------
organized and validly existing under, and by virtue of, the laws of the State of
<PAGE>
Page 24 of 34 Pages
Delaware and is in good standing as a domestic corporation under the laws of
said state with all requisite corporate power and authority to own, operate and
lease its properties and conduct its business as presently conducted. The
Company is qualified to do business as a foreign corporation and is in good
standing in the State of California and in each other state of the United States
where its failure to do so would have a material adverse effect on its business
as presently conducted. The Company holds all licenses, franchises, permits and
authorizations necessary for the lawful conduct of its business.
3.2 Corporate Power; Authorization. The Company has all requisite
------------------------------
legal and corporate power and has taken all requisite corporate action to
execute and deliver this Agreement, to issue and sell the shares of the Common
Stock and to carry out and perform all of its obligations under this Agreement.
This Agreement constitutes the legal, valid and binding obligations of the
Company, enforceable in accordance with its terms, except (i) as limited by
applicable bankruptcy, insolvency, reorganization or similar laws relating to or
affecting the enforcement of creditors' rights generally and (ii) as limited by
equitable principles generally. The execution and delivery of this Agreement
does not, and the performance of this Agreement and the compliance with the
provisions hereof, and the issuance, sale and delivery of the shares of Common
Stock by the Company will not conflict with, or result in a breach or violation
of the terms, conditions or provisions of, or constitute a default under, or
result in the creation or imposition of any lien pursuant to the terms of, the
Certificate of Incorporation or Bylaws of the Company or any statute, law, rule
or regulation or any state or federal order, judgment or decree or any
indenture, mortgage, lease or other material agreement or instrument which the
Company is required to file as an Exhibit to its Form 10-K.
3.3 Issuance and Delivery of the Shares of Common Stock. The
------------------------------------------------------
shares of Common Stock, when issued in compliance with the provisions of this
Agreement, will be validly issued, fully paid and nonassessable. The issuance
and delivery of the shares of Common Stock is not subject to preemptive or any
other similar rights of the stockholders of the Company or any liens or
encumbrances.
3.4 SEC Documents; Financial Statements. The Company has provided
-----------------------------------
the Purchasers with the Company's Annual Report on Form 10-K for the year ended
June 30, 1996, the Quarterly Report on Form 10-Q for the Quarter Ended September
30, 1996 and the Quarterly Report on Form 10-Q for the Quarter Ended December
31, 1996 which are true and complete copies of such documents as filed by the
Company with the Securities and Exchange Commission (the "SEC"). The Company has
filed all documents (the "SEC Documents") that the Company was required to file
with the SEC under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), during the twelve (12) months preceding the date of this
Agreement, and all of such documents conformed in all material respects to the
requirements of the Exchange Act and the rules and regulations thereunder as of
their respective filing dates. None of the SEC Documents as of their respective
dates contained any untrue statement of material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements
made therein, in light of the circumstances under which they were made, not
misleading. The financial statements of the Company included in the SEC
Documents (the "Financial Statements") comply as to form in all material
2
<PAGE>
Page 25 of 34 Pages
respects with applicable accounting requirements and with the published rules
and regulations of the SEC with respect thereto. The Financial Statements have
been prepared in accordance with generally accepted accounting principles
consistently applied and fairly present the consolidated financial position of
the Company and any subsidiaries at the dates thereof and the consolidated
results of their operations and consolidated cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal, recurring
adjustments that are not in the aggregate material).
3.5 Governmental Consents. No consent, approval, order or
----------------------
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state, or local govern- mental authority on the part
of the Company is required in connection with the consummation of the
transactions contemplated by this Agreement except for (a) compliance with the
securities and blue sky laws in the states in which shares of Common Stock are
offered and/or sold, which compliance will be effected in accordance with such
laws and (b) the filing of the Nasdaq National Market Notification Form with the
Nasdaq National Market.
3.6 No Material Adverse Change. Except as otherwise disclosed
----------------------------
herein, since December 31, 1996, there have not been:
(a) Any changes in the financial condition or results of
operations of the Company from that reflected in the Financial Statements except
changes in the ordinary course of business which have not been, either
individually or in the aggregate, materially adverse;
(b) Any material increase in indebtedness for borrowed
money, current liabilities or total liabilities (whether absolute, accrued,
contingent or otherwise) incurred by the Company, except for liabilities,
commitments and obligations incurred in the ordinary course of business;
(c) Any sale, assignment, transfer or other disposition of
any material tangible or intangible asset of the Company, except in the ordinary
course of business;
(d) Any extraordinary transaction; and
(e) Any material agreement that the Company would be
required to file with the SEC.
4. Representations, Warranties and Covenants of the Purchasers.
------------------------------------------------------------
Each Purchaser hereby severally represents and warrants to the Company,
effective as of the Closing Date, as follows:
4.1 Authorization. Purchaser represents and warrants to the
-------------
Company that: (i) Purchaser has all requisite legal and corporate or other power
and capacity and has taken all requisite corporate or other action to execute
and deliver this Agreement, to purchase the shares of Common Stock to be
3
<PAGE>
Page 26 of 34 Pages
purchased by it and to carry out and perform all of its obligations under this
Agreement; and (ii) this Agreement constitutes the legal, valid and binding
obligation of the Purchaser, enforceable in accordance with its terms, except
(a) as limited by applicable bankruptcy, insolvency, reorganization, or similar
laws relating to or affecting the enforcement of creditors' rights generally and
(b) as limited by equitable principles generally.
4.2 Investor Qualifications; Investment Experience. Purchaser is
-----------------------------------------------
an "accredited investor" as defined in Rule 501(a) under the Securities Act, and
Purchaser is a "qualified institutional buyer" as defined in Rule 144A(a)(1)
under the Securities Act. Purchaser is aware of the Company's business affairs
and financial condition and has had access to and has acquired sufficient
information about the Company to reach an informed and knowledgeable decision to
acquire the shares of Common Stock. Purchaser has such business and financial
experience as is required to give it the capacity to protect its own interests
in connection with the purchase of the shares of Common Stock.
4.3 Investment Intent. Purchaser is purchasing the shares of
------------------
Common Stock in the ordinary course of its business for its own account as
principal, for investment purposes only, and not with a present view to, or for,
resale, distribution or fractionalization thereof, in whole or in part, within
the meaning of the Securities Act. No arrangement or understanding exists
between the Purchaser and any other person regarding the resale, distribution or
fractionalization of the shares of Common Stock, in whole or in part, within the
meaning of the Securities Act. Purchaser understands that its acquisition of the
shares of Common Stock has not been registered under the Securities Act or
registered or qualified under any state securities law in reliance on specific
exemptions therefrom, which exemptions may depend upon, among other things, the
bona fide nature of Purchaser's investment intent as expressed herein. Purchaser
has completed or caused to be completed and delivered to the Company, the
Purchaser Questionnaire attached hereto as Exhibit A. Purchaser has, in
----------
connection with its decision to purchase the number of shares of Common Stock
set forth in Schedule I hereto, relied solely upon the documents attached as
----------
appendices thereto and the representations and warranties of the Company
contained herein. Purchaser will not, directly or indirectly, offer, sell,
pledge, transfer or otherwise dispose of (or solicit any offers to buy, purchase
or otherwise acquire or take a pledge of) any of the shares of Common Stock
except in compliance with the Securities Act, and the rules and regulations
promulgated thereunder.
4.4 Registration or Exemption Requirements. Purchaser further
---------------------------------------
acknowledges and understands that the shares of Common Stock may not be resold
or otherwise transferred except in a transaction registered under the Securities
Act or unless an exemption from such registration is available. Purchaser
understands that the certificate(s) evidencing the shares of Common Stock will
be imprinted with a legend that prohibits the transfer of the shares of Common
Stock unless (i) they are registered or such registration is not required, and
(ii) if the transfer is pursuant to an exemption from registration other than
Rule 144 under the Securities Act and, if the Company shall so request in
writing, an opinion of counsel reasonably satisfactory to the Company is
obtained to the effect that the transaction is so exempt.
4.5 No Legal, Tax or Investment Advice. Purchaser understands
------------------------------------
that nothing in this Agreement or any other materials presented to Purchaser in
connection with the purchase and sale of the shares of Common Stock constitutes
4
<PAGE>
Page 27 of 34 Pages
legal, tax or investment advice. Purchaser has consulted such legal, tax and
investment advisors as it, in its sole discretion, has deemed necessary or
appropriate in connection with its purchase of the shares of Common Stock.
5. Conditions to Purchasers' Obligations. Each Purchaser's
----------------------------------------
obligation to purchase the shares of Common Stock at the Closing shall be
subject to the fulfillment or waiver as of the Closing Date of each of the
following conditions:
5.1 Representations and Warranties. The representations and
--------------------------------
warranties made by the Company in Section 3 hereof shall be true and correct in
all material respects when made, and shall be true and correct in all material
respects on the Closing Date with the same force and effect as if they had been
made on and as of said date. Purchasers shall have received a certificate to
such effect, dated the Closing Date and executed by the Chief Executive Officer
of the Company.
5.2 Legal Opinion. The Purchasers shall have received a legal
--------------
opinion of Brobeck, Phleger & Harrison LLP, counsel to the Company, regarding
the matters referred to in Sections 3.1, 3.2 and 3.3, and otherwise reasonably
acceptable to the Purchasers.
6. Conditions to Company's Obligations. The Company's obligation
-----------------------------------
to issue and sell the shares of Common Stock at the Closing shall be subject to
the fulfillment or waiver as of the Closing Date of each of the following
conditions:
6.1 Representations and Warranties. The representations made by
------------------------------
the Purchasers in Section 4 hereof shall be true and correct in all material
respects when made, and shall be true and correct in all material respects on
the Closing Date with the same force and effect as if they had been made on and
as of such date.
6.2 Payment of Purchase Price. Each Purchaser shall have
----------------------------
delivered to the Company payment of the aggregate Purchase Price of the shares
of Common Stock to be purchased by each such Purchaser, in the amounts as set
forth on Schedule I hereto.
6.3 Covenants. All covenants, agreements and conditions contained
---------
in this Agreement to be performed by the Purchasers on or prior to the Closing
Date shall have been performed or complied with in all material respects.
6.4 Blue Sky. The Company shall have obtained all necessary blue
--------
sky law permits and qualifications, or secured exemptions therefrom, required by
any state for the offer and sale of the shares of Common Stock.
7. Affirmative Covenants of the Company. The Company hereby
---------------------------------------
covenants and agrees as follows:
5
<PAGE>
Page 28 of 34 Pages
7.1 Financial Information. The Company will mail the following
----------------------
reports to each Purchaser until such Purchaser transfers, assigns or sells the
shares of Common Stock purchased by such Purchaser pursuant to this Agreement:
(a) Within one hundred twenty (120) days after the end of
each fiscal year, a copy of its Annual Report on Form 10-K.
(b) Within sixty (60) days after the end of the first,
second and third quarterly accounting periods of each fiscal year of the
Company, a copy of its Quarterly Report on Form 10-Q.
(c) Within ten (10) days after the Company files any Current
Report on Form 8-K with the SEC, such Current Report on Form 8-K.
7.2 Registration. The Company shall file with the SEC a
------------
registration statement on Form S-3 covering all of the shares of Common Stock
issued and sold to the Purchasers pursuant hereto within thirty (30) days after
the closing hereunder and shall use its best efforts to cause such registration
statement to become effective as soon as practicable thereafter. The Company
agrees to keep such registration statement in effect until the earlier of (i)
such date as all of the shares of Common Stock covered by the registration
statement have been resold or (ii) such time as all of the shares of Common
Stock purchased hereunder by each Purchaser can be sold within a 90-day period
without compliance with the registration requirements of the Securities Act
pursuant to Rule 144 thereunder. Notwithstanding anything else in this Section
7.2, the Company shall have the right, for a period not to exceed thirty (30)
days in duration and upon written notice to each of the Purchasers, to prohibit
the sale of the shares of Common Stock issued and sold to the Purchasers
hereunder pursuant to a registration statement effected under this Section 7.2,
in the event that the Company's Board of Directors, pursuant to advice of
counsel, deems it necessary, in light of a pending or potential corporate event
which has resulted in material nonpublic information not yet having been
disseminated by the Company or otherwise included in such registration
statement, to prohibit such sales until such information can be made public or
included in such registration statement. The Company shall within such thirty
(30) days add any necessary disclosure to the registration statement and notify
the Purchasers that they are no longer prohibited from selling shares of Common
Stock under such registration statement.
With respect to any registration effected pursuant to this
Section 7.2, the parties further agree as follows:
(a) The Company shall prepare and file with the SEC such
amendments and supplements to any such registration statement and the prospectus
used in connection with such registration statement as may be necessary to
comply with the provisions of the Act with respect to the disposition of all
securities covered by such registration statement.
(b) The Company shall furnish to the Purchasers such numbers of
copies of a prospectus, including a preliminary prospectus, in conformity with
the requirements of the Act, and such other documents as they may reasonably
request in order to facilitate the disposition of Registrable Securities owned
by the Purchasers.
(c) The Company shall bear all expenses other than underwriting
discounts and commissions incurred in connection with such registration, filing
6
<PAGE>
Page 29 of 34 Pages
or qualification, including (without limitation) all registration, filing and
qualification fees, printer's and accounting fees, fees and disbursements of
counsel for the Company, and the reasonable fees and disbursements of one
counsel for the Purchasers.
(d) The parties agree to the following indemnification rights and
obligations:
(i) To the extent permitted by law, the Company shall
indemnify and hold harmless each Purchaser and each person, if any, who controls
such Purchaser within the meaning of the Act or the Securities Exchange Act of
1934, as amended (the "1934 Act"), against any losses, claims, damages, or
liabilities (joint or several) to which they may become subject under the Act,
or other federal or state law, insofar as such losses, claims, damages, or
liabilities (or actions in respect thereof) arise out of or are based upon any
of the following statements, omissions or violations (collectively a
"Violation"): (i) any untrue statement or alleged untrue statement of a material
fact contained in such registration statement, including any preliminary
prospectus or final prospectus contained therein or any amendments or
supplements thereto; (ii) the omission or alleged omission to state therein a
material fact required to be stated therein, or necessary to make the statements
therein not misleading; or (iii) any violation or alleged violation by the
Company of the Act, the 1934 Act, any state securities law or any rule or
regulation promulgated under the Act, or any state securities law. The Company
will pay to each Purchaser or controlling person any legal or other expenses
reasonably incurred by them (such payment to be made as incurred by such
persons) in connection with investigating or defending any such loss, claim,
damage, liability, or action; provided, however, that the indemnity agreement
contained in this paragraph (d)(i) shall not apply to amounts paid in settlement
of any such loss, claim, damage, liability, or action if such settlement is
effected without the consent of the Company (which consent shall not be
unreasonably withheld), nor shall the Company be liable in any such case for any
such loss, claim, damage, liability, or action to the extent that it arises out
of or is based upon a Violation which occurs in reliance upon and in conformity
with written information furnished expressly for use in connection with such
registration by the Purchaser or controlling person.
(ii) To the extent permitted by law, each Purchaser will
indemnify and hold harmless the Company, each of its directors, each of its
officers who has signed the registration statement, and each person, if any, who
controls the Company within the meaning of the Act, against any losses, claims,
damages, or liabilities (joint or several) to which any of the foregoing persons
may become subject, under the Act, or other federal or state law, insofar as
such losses, claims, damages, or liabilities (or actions in respect thereto)
arise out of or are based upon any Violation, in each case to the extent (and
only to the extent) that such Violation occurs in reliance upon and in
conformity with written information furnished by such Purchaser expressly for
use in connection with such registration; and such Purchaser will pay any legal
or other expenses reasonably incurred by any person intended to be indemnified
pursuant to this paragraph (d)(ii) (such payment to be made as incurred by such
persons), in connection with investigating or defending any such loss, claim,
damage, liability, or action; provided, however, that the indemnity agreement
contained in this paragraph (d)(ii) shall not apply to amounts paid in
7
<PAGE>
Page 30 of 34 Pages
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Purchaser, which consent shall
not be unreasonably withheld; provided that in no event shall any indemnity
under this paragraph exceed the gross proceeds from the offering received by the
Purchaser, unless such Violation by the Purchaser is wilful.
(iii) Promptly after receipt by an indemnified party under
this paragraph (d) of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this paragraph (d), deliver
to the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party
(together with all other indemnified parties which may be represented without
conflict by one counsel) shall have the right to retain one separate counsel,
with the fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party represented by such
counsel in such proceeding. The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such
action, if prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party under this
paragraph (d), but the omission so to deliver written notice to the indemnifying
party will not relieve it of any liability that it may have to any indemnified
party otherwise than under this paragraph (d).
8. Restrictions on Transferability of Common Stock; Compliance
--------------------------------------------------------------
with Securities Act. The shares of Common Stock purchased hereunder shall not be
- -------------------
transferable in the absence of a registration under the Securities Act or an
exemption therefrom or in the absence of compliance with any term of this
Agreement. The Company shall be entitled to give stop transfer instructions to
its transfer agent with respect to the Common Stock in order to enforce the
foregoing restrictions.
9. Miscellaneous.
-------------
9.1 Waivers and Amendments. The terms of this Agreement may be
-----------------------
waived or amended with the written consent of the Company and each Purchaser.
9.2 Governing Law. This Agreement shall be governed in all
--------------
respects by and construed in accordance with the laws of the State of California
without any regard to conflicts of laws principles.
9.3 Survival. The representations, warranties, covenants and
--------
agreements made in this Agreement shall survive any investigation made by the
Company or the Purchasers and the Closing.
9.4 Successors and Assigns. The provisions hereof shall inure to
----------------------
the benefit of, and be binding upon, the successors, assigns, heirs, executors
8
<PAGE>
Page 31 of 34 Pages
and administrators of the parties to this Agreement. Notwithstanding the
foregoing, no Purchaser shall assign this Agreement without the prior written
consent of the Company.
9.5 Entire Agreement. This Agreement constitutes the full and
-----------------
entire understanding and agreement between the parties with regard to the
subjects thereof.
9.6 Notices, etc. All notices and other communications required
-------------
or permitted under this Agreement shall be effective upon receipt and shall be
in writing and may be delivered in person, by telecopy, overnight delivery
service or registered or certified United States mail, addressed to the Company
or the Purchasers, as the case may be, at their respective addresses set forth
at the beginning of this Agreement or on Schedule I, or at such other address as
----------
the Company or the Purchasers shall have furnished to the other party in
writing. All notices and other communications shall be effective upon the
earlier of actual receipt thereof by the person to whom notice is directed or
(i) in the case of notices and communications sent by personal delivery or
telecopy, one business day after such notice or communication arrives at the
applicable address or was successfully sent to the applicable telecopy number,
(ii) in the case of notices and communications sent by overnight delivery
service, at noon (local time) on the second business day following the day such
notice or communication was sent, and (iii) in the case of notices and
communications sent by United States mail, seven days after such notice or
communication shall have been deposited in the United States mail.
9.7 Severability of this Agreement. If any provision of this
--------------------------------
Agreement shall be judicially determined to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
9.8 Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
9.9 Further Assurances. Each party to this Agreement shall do and
------------------
perform or cause to be done and performed all such further acts and things and
shall execute and deliver all such other agreements, certificates, instruments
and documents as the other party hereto may reasonably request in order to carry
out the intent and accomplish the purposes of this Agreement and the
consummation of the transactions contemplated hereby.
9.10 Termination. In the event that the Closing shall not have
-----------
occurred on or before thirty (30) days from the date hereof, this Agreement
shall terminate at the close of business on such date.
9.11 Expenses. The Company and each such Purchaser shall bear its
--------
own expenses incurred on its behalf with respect to this Agreement and the
transactions contemplated hereby, including fees and expenses of legal counsel.
9
<PAGE>
Page 32 of 34 Pages
9.12 Effectiveness of Agreement. The Company's agreement to sell
--------------------------
the shares of Common Stock to the Purchasers pursuant to the terms of this
Agreement will only be effective upon acceptance of this Agreement by the
Company as evidenced by the Company's execution of this Agreement.
10
<PAGE>
Page 33 of 34 Pages
IN WITNESS WHEREOF, the Company and Purchasers have executed this
Common Stock Purchase Agreement as of the date first above written.
COMPANY:
PHARMACYCLICS, INC.
By:
----------------------------------
Title:
----------------------------------
PURCHASERS:
QUANTUM INDUSTRIAL PARTNERS LDC
By:
----------------------------------
Title:
----------------------------------
Address: c/o Curacao International Trust Company N.V.
Kaya Flamboyan 9
Willemstad
Curacao, Netherlands Antilles
BOARD OF PENSION COMMISSIONERS OF THE CITY OF
LOS ANGELES
By:
----------------------------------
Title:
----------------------------------
Address: 360 E. Second Street
Los Angeles, CA 90053
11
<PAGE>
Page 34 of 34 Pages
KILEY REVOCABLE TRUST, TEE THOMAS D. KILEY,
TEE NANCY L. KILEY
By:
---------------------------------------
Thomas D. Kiley, Trustee
Address: 986 Baileyana Road
Hillsborough, CA 94010
--------------------------------------------
Joseph S. Lacob
Address: c/o Kleiner Perkins Caufield & Byers
2750 Sand Hill Road
Menlo Park, CA 94025
12
