-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, FiRt6xVRHOW8HJ+m5wY87JB8ROMmWYeT6XuMPL2yrr7uxDJEx7r/ptPJILkKxPEk DoRtgacQepUGdsBPItEBeQ== 0000950123-05-004893.txt : 20050422 0000950123-05-004893.hdr.sgml : 20050422 20050422175103 ACCESSION NUMBER: 0000950123-05-004893 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 20050422 DATE AS OF CHANGE: 20050422 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OSI PHARMACEUTICALS INC CENTRAL INDEX KEY: 0000729922 STANDARD INDUSTRIAL CLASSIFICATION: IN VITRO & IN VIVO DIAGNOSTIC SUBSTANCES [2835] IRS NUMBER: 133159796 STATE OF INCORPORATION: DE FISCAL YEAR END: 1204 FILING VALUES: FORM TYPE: S-3 SEC ACT: 1933 Act SEC FILE NUMBER: 333-124279 FILM NUMBER: 05768381 BUSINESS ADDRESS: STREET 1: 58 SOUTH SERVICE RD. STREET 2: SUITE 110 CITY: MELVILLE STATE: NY ZIP: 11747 BUSINESS PHONE: 631-962-2000 MAIL ADDRESS: STREET 1: 58 SOUTH SERVICE RD. STREET 2: SUITE 110 CITY: MELVILLE STATE: NY ZIP: 11747 FORMER COMPANY: FORMER CONFORMED NAME: ONCOGENE SCIENCE INC DATE OF NAME CHANGE: 19920703 S-3 1 y08089sv3.txt FORM S-3 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 22, 2005 REGISTRATION NO. 333- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION --------------------- FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 --------------------- OSI PHARMACEUTICALS, INC. (Exact name of registrant as specified in its charter) DELAWARE 13-3159796 (State or other jurisdiction of incorporation (I.R.S. Employer Identification No.) organization)
58 SOUTH SERVICE ROAD, SUITE 110, MELVILLE, NEW YORK 11747 (631) 962-2000 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) --------------------- ROBERT L. VAN NOSTRAND VICE PRESIDENT AND CHIEF FINANCIAL OFFICER OSI PHARMACEUTICALS, INC. 58 SOUTH SERVICE ROAD, SUITE 110, MELVILLE, NEW YORK 11747 (631) 962-2000 (Name, address, including zip code, and telephone number, including area code, of agent for service) --------------------- COPIES OF ALL COMMUNICATIONS TO: SPENCER W. FRANCK, JR., ESQUIRE SAUL EWING LLP 1200 LIBERTY RIDGE DRIVE, SUITE 200, WAYNE, PENNSYLVANIA 19087-5055 (610) 251-5082 APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to time after the effective date of this registration statement. If the only securities being registered on this form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. [ ] If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [X] If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] ---------- If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] ---------- If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [ ] CALCULATION OF REGISTRATION FEE
- ------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------ PROPOSED MAXIMUM PROPOSED MAXIMUM TITLE OF SECURITIES AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF TO BE REGISTERED REGISTERED PER SHARE OFFERING PRICE REGISTRATION FEE - ------------------------------------------------------------------------------------ Common Stock, par value $.01 per share............. 84,940 $47.85(1) $4,064,379(1) $478.38(2) - ------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------
(1) In accordance with Rule 457(c), the price shown is estimated solely for the purposes of calculating the registration fee, and is based on the average of the reported high and low sales prices of the common stock as reported on the Nasdaq National Market on April 20, 2005, which was $47.85. (2) Represents the Proposed Maximum Aggregate Offering Price multiplied by $.00011770. THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED. PROSPECTUS 84,940 SHARES (OSI LOGO) COMMON STOCK, PAR VALUE $.01 PER SHARE ---------------------- The stockholders named on page 14 are selling up to 84,940 shares of OSI's common stock. OSI's common stock is traded on the Nasdaq National Market under the symbol "OSIP". On April 20, 2005, the reported closing price of the common stock was $47.62 per share. ---------------------- THIS INVESTMENT INVOLVES RISK. SEE "RISK FACTORS" BEGINNING ON PAGE 1 OF THIS PROSPECTUS. ---------------------- Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is April , 2005 TABLE OF CONTENTS Risk Factors................................................ 1 Recent Events............................................... 10 Use of Proceeds............................................. 10 Selling Stockholders........................................ 10 Plan of Distribution........................................ 12 Available Information....................................... 13 Incorporation of Certain Documents by Reference............. 13 Legal Matters............................................... 14 Experts..................................................... 14
In this prospectus, "OSI," "our company," "we," "us," and "our" refer to OSI Pharmaceuticals, Inc. and subsidiaries. We own or have rights to use various copyrights, trademarks and trade names used in our business, including the following: Tarceva(TM) (erlotinib) and Novantrone(R)(mitoxantrone for injection concentrate). i RISK FACTORS (Cautionary Statement under the Private Securities Litigation Reform Act of 1995, as amended) This prospectus contains forward-looking statements that do not convey historical information, but relate to predicted or potential future events, such as statements of our plans, strategies and intentions, or our future performance or goals for our product development programs. These statements can often be identified by the use of forward-looking terminology such as "believe," "expect," "intend," "may," "should," or "anticipate" or similar terminology. The statements involve risks and uncertainties and are based on various assumptions. Stockholders and prospective stockholders are cautioned that these statements are only projections. In addition, any forward-looking statement that we make is intended to speak only as of the date on which we made the statement. Except for our ongoing obligations to disclose material information under the federal securities laws, we will not update any forward-looking statement to reflect events or circumstances that occur after the date on which the statement is made. The following risks and uncertainties, among others, may cause our actual results to differ materially from those described in forward-looking statements made in this report or presented elsewhere by management from time to time. WE HAVE INCURRED LOSSES SINCE OUR INCEPTION, AND WE EXPECT TO INCUR LOSSES OVER THE NEXT FEW YEARS, WHICH MAY CAUSE THE VALUE OF OUR COMMON STOCK TO DECREASE. We have had net operating losses since our inception in 1983. We expect to continue to incur operating losses over the next few years as a result of our expenses for the continued research, development and commercialization of Tarceva(TM) (erlotinib) and our other clinical products. We cannot predict when our business will become profitable. We do not expect to achieve profitability for at least two years following the launch of Tarceva. At December 31, 2004, our accumulated deficit was $814.0 million. Our net losses for the three months ended December 31, 2004 and 2003 were $48.4 million and $40.1 million, respectively. Our net losses were $260.4 million, $181.4 million and $218.5 million for fiscal years 2004, 2003 and 2002, respectively. Our net loss for fiscal 2004 included an in-process research and development charge of $32.8 million related to the acquisition of certain assets from Probiodrug AG in July 2004 and a charge of $24.6 million related to an impairment of an intangible asset. Our net loss for fiscal 2003 included an in- process research and development charge of $31.5 million related to the acquisition of Cell Pathways, Inc. in June 2003. Our net loss for fiscal 2002 included an in-process research and development charge of $130.2 million related to the acquisition of certain assets from Gilead Sciences, Inc. in December 2001. WE, TOGETHER WITH OUR ALLIANCE PARTNERS GENENTECH, INC. AND ROCHE, MAY NOT BE ABLE TO MARKET OR GENERATE SALES OF TARCEVA TO THE EXTENT ANTICIPATED. Our ability to successfully penetrate the market and generate sales of Tarceva may be limited by a number of factors, including the following: - Certain of our competitors in the HER1/EGFR field, namely AstraZeneca plc and Bristol-Myers Squibb Company/ImClone Systems Incorporated, have already received regulatory approvals for and have begun marketing similar products in the United States, the EU, Japan and other territories, which may result in greater physician awareness of their products as compared to Tarceva. - Information from our competitors or the academic community indicating that current products or new products are more effective than Tarceva could, if and when it is generated, impede our market penetration or decrease our existing market share. - Physicians may be reluctant to switch from existing treatment methods, including traditional chemotherapy agents, to Tarceva. 1 - The price for Tarceva, which is set by Genentech in the United States after consultation with us and will be set by Roche outside of the United States, as well as pricing decisions by our competitors, may have an effect on our Tarceva-derived revenues. - Our Tarceva-derived revenues may diminish if third-party payors, including private health coverage insurers and health maintenance organizations, do not provide adequate coverage or reimbursement for Tarceva. IF GOVERNMENT AGENCIES DO NOT GRANT US OR OUR COLLABORATIVE PARTNERS REQUIRED APPROVALS FOR ANY OF OUR POTENTIAL PRODUCTS IN A TIMELY MANNER OR AT ALL, WE OR OUR COLLABORATIVE PARTNERS WILL NOT BE ABLE TO DISTRIBUTE OR SELL OUR PRODUCTS CURRENTLY UNDER DEVELOPMENT. All of our potential products must undergo extensive regulatory approval processes in the United States and other countries. These regulatory processes, which include pre-clinical testing and clinical trials of each compound to establish safety and efficacy, can take many years and require the expenditure of substantial resources. The FDA and the other regulatory agencies in additional markets which are material to us and our collaborative partners, including the European Agency for the Evaluation of Medicinal Products, or EMEA, and the Japanese Ministry of Health, may delay or deny the approval of our potential products. Although we have been successful in gaining regulatory approval for Tarceva in the United States, and our partner Roche has gained approval in Switzerland, for the NSCLC indication, there can be no guarantee of subsequent approvals either for Tarceva in other territories (including the EU) or for other indications in the United States or for other products in the United States and other territories. Delays or rejections may be encountered during any stage of the regulatory process based upon the failure of the clinical data to demonstrate compliance with, or upon the failure of the product to meet, a regulatory agency's requirements for safety, efficacy and quality. Any such delay could have a negative effect on our business. A drug candidate cannot be marketed in the United States until it has been approved by the FDA. Once approved, drugs, as well as their manufacturers, are subject to continuing and ongoing review, and discovery of previously unknown problems with these products or the failure to adhere to manufacturing or quality control requirements may result in restrictions on their distribution, sale or use, or their withdrawal from the market. The FDA also has the authority, when approving a product, to impose significant limitations on the product in the nature of warnings, precautions and contra-indications that could negatively affect the profitability of a drug. Furthermore, once a drug is approved, the drug can only be marketed for the indications and claims approved by the FDA. If we fail to comply with the FDA regulations prohibiting promotion of off-label uses and the promotion of products for which marketing clearance has not been obtained, the FDA, or the Office of the Inspector General of the U.S. Department of Health and Human Services, or state Attorneys General could bring an enforcement action against us that would inhibit our marketing capabilities as well as result in significant penalties. The ability to market and sell a drug product outside of the United States is also subject to stringent and, in some cases, equally complex regulatory processes that vary depending on the jurisdiction. WE ARE RESPONSIBLE FOR THE SUPPLY OF TARCEVA IN THE UNITED STATES. SINCE WE HAVE NO COMMERCIAL MANUFACTURING FACILITIES, WE ARE DEPENDENT ON TWO SUPPLIERS FOR THE ACTIVE PHARMACEUTICAL INGREDIENT, OR API, FOR TARCEVA AND A SINGLE SUPPLIER FOR THE TABLETING OF TARCEVA IN THE UNITED STATES. We are responsible for manufacturing and supplying Tarceva in the United States under the terms of a Manufacturing and Supply Agreement entered into with Genentech in 2004. We rely on two third-party suppliers to manufacture the API, erlotinib, for Tarceva. We also currently rely on a single manufacturer to formulate the Tarceva tablets. We are presently seeking another manufacturer to serve as an alternative (i.e. back-up) provider of Tarceva tablets. If our relationships with any of these manufacturers terminate or if they are unable to meet their obligations, we will need to find other sources of supply. Such alternative sources of supply may be difficult to find on terms acceptable to us or in a timely manner, and, 2 if found, would require FDA approval which could cause delays in the availability of erlotinib and ultimately Tarceva tablets, which, in turn, could negatively impact our Tarceva-derived revenues. Furthermore, the manufacturing of our products is, and will continue to be, subject to current good manufacturing practices regulations prescribed by the FDA or other standards prescribed by the appropriate regulatory agency in the country of use. If our manufacturers, including the current manufacturers of erlotinib and Tarceva tablets, do not comply with all applicable regulatory standards, they may not be permitted to manufacture Tarceva or any other product for commercial sale. If this occurs, we might not be able to identify another third-party manufacturer on terms acceptable to us or in a timely manner, or such other third-party manufacturer may not receive FDA approval in a timely manner or at all. Any of the foregoing could cause delays in the availability of our products, including erlotinib and/or Tarceva tablets, which would negatively impact our revenues. If we fail to meet our manufacturing obligations, our partner, Genentech, also has the right to take over supply of Tarceva in the United States. IF WE DO NOT MAINTAIN OUR CO-DEVELOPMENT AND MARKETING ALLIANCE WITH GENENTECH AND ROCHE FOR TARCEVA, THE MARKETING AND SALE OF TARCEVA MAY BE COMPROMISED OR DELAYED. Tarceva is being developed and commercialized in an alliance under co-development and marketing agreements with Genentech and Roche. The development program is managed by us, Genentech and Roche under a global development committee. Under the alliance, Genentech leads the marketing efforts in the United States and Roche will market the drug in the rest of the world. In 2004, we signed an amendment to our collaboration agreement with Genentech to provide us with the right to co-promote Tarceva in the United States and signed a Manufacturing and Supply Agreement with Genentech that clarified our role in supplying Tarceva for the U.S. market. The OSI/Genentech collaboration agreement continues until the date on which neither we nor Genentech is entitled to receive a share of the operating profits or losses on any products resulting from the collaboration, that is, until the date that we and Genentech mutually agree to terminate the collaboration or until either party exercises its early termination rights as described as follows. The OSI/ Genentech collaboration agreement is subject to early termination in the event of certain customary defaults, such as material breach of the agreement and bankruptcy. Since January 8, 2003, Genentech has had the right to terminate the OSI/Genentech collaboration agreement with six months' prior written notice. The provisions of the amendment allowing us to co-promote are also subject to termination by Genentech upon a material breach of the amendment by us which remains uncured or upon a pattern of nonmaterial breaches which remain uncured. The OSI/Roche agreement continues until the date on which we are no longer entitled to receive a royalty on products resulting from the development of Tarceva, that is, until the date of expiration or revocation or complete rejection of the last to expire patent covering Tarceva or, in countries where there is no valid patent covering Tarceva, on the tenth anniversary of the first commercial sale of Tarceva in that country. The OSI/Roche agreement is subject to early termination in the event of certain customary defaults, such as material breach of the agreement and bankruptcy. In addition, since July 31, 2003, Roche has had the right to terminate the agreement on a country-by-country basis with six months' prior written notice. Since July 31, 2003, we also have had the right to terminate the agreement on a country-by-country basis if Roche has not launched or marketed a product in such country under certain circumstances. If we do not maintain a successful collaborative partnership with Genentech and Roche for the co-development and commercialization of Tarceva, we may be forced to focus our efforts internally to commercialize Tarceva on our own. This would require greater financial resources and would result in us incurring greater expenses and may cause a delay in market penetration while we continue to build our own commercial operation or seek alternative collaborative partners. 3 IF ANY OF OUR CURRENT OR FUTURE MARKETED PRODUCTS, INCLUDING TARCEVA OR NOVANTRONE(R) (MITOXANTRONE FOR INJECTION CONCENTRATE) WERE TO BECOME THE SUBJECT OF PROBLEMS RELATED TO THEIR EFFICACY, SAFETY, OR OTHERWISE, OR IF NEW, MORE EFFECTIVE TREATMENTS WERE TO BE INTRODUCED, OUR REVENUES FROM SUCH MARKETED PRODUCTS COULD DECREASE. If Tarceva or Novantrone or any of our other current or future marketed products become the subject of problems, including those related to, among others: - efficacy or safety concerns with the products, even if not justified; - unexpected side-effects; - regulatory proceedings subjecting the products to potential recall; - publicity affecting doctor prescription or patient use of the product; - pressure from competitive products; or - introduction of more effective treatments; our revenues from such marketed products could decrease. For example, efficacy or safety concerns may arise, whether or not justified, that could lead to the recall or withdrawal of such marketed products. In the event of a recall or withdrawal of a product such as Tarceva or Novantrone, our revenues would significantly decline. IF WE DO NOT RECEIVE ADEQUATE THIRD-PARTY REIMBURSEMENT FOR THE SALES OF OUR PRODUCTS, WE MAY NOT BE ABLE TO SELL SUCH PRODUCTS ON A PROFITABLE BASIS. Sales of our products will depend, in part, upon the extent to which the costs of our products will be paid by health maintenance, managed care, pharmacy benefit and similar reimbursement sources, or reimbursed by government health administration authorities, private health coverage insurers and other third-party payors. Such third-party payors continue to aggressively challenge the prices charged for healthcare products and services. Additionally, federal and state governments have prioritized the containment of healthcare costs, and drug prices have been targeted in this effort. If these organizations and third-party payors do not consider our products to be cost-effective, they may not reimburse providers of our products, or the level of reimbursement may not be sufficient to allow us to sell our products on a profitable basis. THE MEDICARE PRESCRIPTION DRUG IMPROVEMENT AND MODERNIZATION ACT OF 2003 MATERIALLY CHANGES THE MEDICARE REIMBURSEMENT GUIDELINES FOR INTRAVENOUS AND ORAL ONCOLOGY PRODUCTS. SUCH CHANGES MAY NEGATIVELY IMPACT OUR REVENUES FOR NOVANTRONE. The Medicare Prescription Drug Improvement and Modernization Act of 2003, or MMA, will have a substantive impact on companies that produce pharmaceutical products, including chemotherapeutics, and the providers that prescribe these medications. MMA reduced the levels of Medicare reimbursement to oncologists for intravenous oncology products like Novantrone. Under MMA, Medicare benefits will be primarily provided through private entities that will attempt to negotiate price concessions from pharmaceutical manufacturers, which may increase pressure to lower prescription drug prices. MMA also includes other cost containment measures for Medicare in the event Medicare cost increases exceed a certain level, which may also impose limitations on prescription drug prices. These changes in Medicare reimbursement could have a negative impact on our revenues derived from sales of Novantrone. IF SERONO S.A. DOES NOT FULFILL ITS OBLIGATIONS FOR MANUFACTURING AND SUPPLYING NOVANTRONE, WE MAY NOT BE ABLE TO CONTINUE THE MARKETING AND DISTRIBUTION OF THE PRODUCT WHICH COULD CAUSE OUR REVENUES TO DECREASE. Serono is responsible for the manufacture and supply of Novantrone. Under our agreement with Serono, we do not have the obligation nor the right to manufacture Novantrone. These obligations and rights are held solely by Serono. If Serono is delayed in or restricted from supplying the product, we would 4 be directly affected in that any such delay or restriction would impede us from selling the product. Without the sales of Novantrone, our revenues would decrease. ONE ASPECT OF OUR BUSINESS STRATEGY DEPENDS ON OUR ABILITY TO IDENTIFY AND ACQUIRE PRODUCT CANDIDATES AND MARKETED PRODUCTS, WHICH IF NOT MET, MAY PREVENT US FROM ACHIEVING EXPECTED FUTURE PERFORMANCE. As part of our business strategy, we plan to identify and acquire product candidates and approved products for markets that we can reach through our commercial operations. We may not be able to acquire rights to additional products or product candidates on acceptable terms, if at all. If we fail to obtain, develop and successfully commercialize such additional product candidates and approved products, we may not achieve expectations of our future performance. ALTHOUGH WE HAVE POTENTIAL PRODUCTS THAT APPEAR TO BE PROMISING AT EARLY STAGES OF DEVELOPMENT AND IN CLINICAL TRIALS, NONE OF OUR POTENTIAL PRODUCTS MAY REACH THE COMMERCIAL MARKET FOR A NUMBER OF REASONS. Successful research and development of pharmaceutical products is high risk. Most products and development candidates fail to reach the market. Our success depends on the discovery of new drugs that we can commercialize. It is possible that our potential oncology products and diabetes and obesity products may never reach the market for a number of reasons. They may be found ineffective or may cause harmful side-effects during pre-clinical testing or clinical trials or fail to receive necessary regulatory approvals. We may find that certain products cannot be manufactured on a commercial scale basis and, therefore, they may not be economical to produce. Our products could also fail to achieve market acceptance or be precluded from commercialization by proprietary rights of third parties. We have a number of product candidates in various stages of development and do not expect them to be commercially available for a number of years, if at all. Our candidates that are in clinical trials will still require significant research and development and regulatory approvals before we or our collaborative partners will be able to market them. IF OUR COMPETITORS SUCCEED IN DEVELOPING PRODUCTS AND TECHNOLOGIES THAT ARE MORE EFFECTIVE THAN OUR OWN, OR IF SCIENTIFIC DEVELOPMENTS CHANGE OUR UNDERSTANDING OF THE POTENTIAL SCOPE AND UTILITY OF OUR PRODUCTS, THEN OUR PRODUCTS AND TECHNOLOGIES MAY BE RENDERED LESS COMPETITIVE. We face significant competition from industry participants that are pursuing similar products and technologies that we are pursuing and are developing pharmaceutical products that are competitive with our products and potential products. Some of our industry competitors have greater capital resources, larger overall research and development staffs and facilities, and a longer history in drug discovery and development, obtaining regulatory approval and pharmaceutical product manufacturing and marketing than we do. With these additional resources, our competitors may be able to respond to the rapid and significant technological changes in the biotechnology and pharmaceutical industries faster than we can. Our future success will depend in large part on our ability to maintain a competitive position with respect to these technologies. Rapid technological development, as well as new scientific developments, may result in our compounds, products or processes becoming obsolete before we can recover any of the expenses incurred to develop them. For example, changes in our understanding of the appropriate population of patients who should be treated with a targeted therapy like Tarceva may limit the drug's market potential if it is subsequently demonstrated that only certain subsets of patients should be treated with the targeted therapy. OUR RELIANCE ON THIRD PARTIES, SUCH AS CLINICAL RESEARCH ORGANIZATIONS, OR CROS, MAY RESULT IN DELAYS IN COMPLETING, OR A FAILURE TO COMPLETE, CLINICAL TRIALS IF THEY FAIL TO PERFORM UNDER OUR AGREEMENTS WITH THEM. In the course of product development, we engage CROs to conduct and manage clinical studies and to assist us in guiding our products through the FDA review and approval process. For example, we collaborated with the National Cancer Institute of Canada's Clinical Trial Group based at Queens University, Ontario, in connection with our Tarceva Phase III trials. Because we have engaged and intend to continue to engage CROs to help us obtain market approval for our drug candidates, many important aspects of this process have been and will be out of our direct control. If the CROs fail to perform their 5 obligations under our agreements with them or fail to perform clinical trials in a satisfactory manner, we may face delays in completing our clinical trials, as well as commercialization of one or more drug candidates. Furthermore, any loss or delay in obtaining contracts with such entities may also delay the completion of our clinical trials and the market approval of drug candidates. THE USE OF ANY OF OUR POTENTIAL PRODUCTS IN CLINICAL TRIALS AND THE SALE OF ANY APPROVED PRODUCTS EXPOSES US TO LIABILITY CLAIMS. The nature of our business exposes us to potential liability risks inherent in the testing, manufacturing and marketing of drug candidates and products. If any of our drug candidates in clinical trials or our marketed products harm people or allegedly harm people, we may be subject to costly and damaging product liability claims. A number of patients who participate in trials are already critically ill when they enter a trial. The waivers we obtain may not be enforceable and may not protect us from liability or the costs of product liability litigation. While we currently maintain product liability insurance that we believe is adequate, we are subject to the risk that our insurance will not be sufficient to cover claims. There is also a risk that adequate insurance coverage will not be available in the future on commercially reasonable terms, if at all. The successful assertion of an uninsured product liability or other claim against us could cause us to incur significant expenses to pay such a claim, could adversely affect our product development and could cause a decline in our product revenues. Even a successfully defended product liability claim could cause us to incur significant expenses to defend such a claim, could adversely affect our product development and could cause a decline in our product revenues. THE FAILURE TO PREVAIL IN LITIGATION OR THE COSTS OF LITIGATION COULD HARM OUR FINANCIAL PERFORMANCE AND BUSINESS OPERATIONS. As a public company, we are susceptible to certain types of litigation, including claims asserting violations of securities and derivative actions. In particular, we currently face a securities class action alleging violations of securities laws which are described in Part II, Item 1, "Legal Proceedings" of our Transition Report on Form 10-Q for the transition period ended December 31, 2004. Litigation is inherently unpredictable and we may incur substantial expense in defending ourselves or asserting our rights in the litigation to which we are currently subject, or in new lawsuits or claims brought against us. Litigation can be expensive to defend, regardless if a claim has merit, and the defense of such actions may divert the attention of our management that would otherwise be engaged in running our business and utilize resources that would otherwise be used for the business. While we currently maintain insurance that we believe is adequate, we are subject to the risk that our insurance will not be sufficient to cover claims. IF WE OR OUR COLLABORATIVE PARTNERS ARE REQUIRED TO OBTAIN LICENSES FROM THIRD PARTIES, OUR REVENUES AND ROYALTIES ON ANY COMMERCIALIZED PRODUCTS COULD BE REDUCED. The development of some of our products may require the use of technology developed by third parties. The extent to which efforts by other researchers have resulted or will result in patents and the extent to which we or our collaborative partners are forced to obtain licenses from others, if available, on commercially reasonable terms is currently unknown. If we or our collaborative partners must obtain licenses from third parties, fees must be paid for such licenses, which would reduce the revenues and royalties we may receive on commercialized products. IF WE CANNOT SUCCESSFULLY PROTECT, EXPLOIT OR ENFORCE OUR INTELLECTUAL PROPERTY RIGHTS, OUR ABILITY TO DEVELOP AND COMMERCIALIZE OUR PRODUCTS WILL BE SEVERELY LIMITED. We hold numerous U.S. and foreign patents and have many pending applications for additional patents. We intend to continue to seek patent protection for or maintain as trade secrets all of the commercially promising product candidates that we have discovered, developed or acquired. Our success depends, in part, on our ability and our collaborative partners' ability to obtain and maintain patent protection for new product candidates, maintain trade secret protection and operate without infringing the proprietary rights of third parties. As with most biotechnology and pharmaceutical companies, our patent 6 position is highly uncertain and involves complex legal and factual questions. Without patent and other similar protection, other companies could offer substantially identical products for sale without incurring the sizeable discovery and development costs that we have incurred. Our ability to recover these expenditures and realize profits upon the sale of products could be diminished. The process of obtaining patents can be time-consuming and expensive with no certainty of success. Even if we spend the necessary time and money, a patent may not issue or it may insufficiently protect the technology it was intended to protect. We can never be certain that we were first to develop the technology or that we were the first to file a patent application for the particular technology because most U.S. patent applications are confidential until a patent publishes or issues, and publications in the scientific or patent literature lag behind actual discoveries. If our pending patent applications are not approved for any reason or if we are unable to receive patent protection for additional proprietary technologies that we develop, the degree of future protection for our proprietary rights will remain uncertain. Furthermore, third parties may independently develop similar or alternative technologies, duplicate some or all of our technologies, design around our patented technologies or challenge our issued patents. IF OTHER COMPANIES CLAIM THAT WE INFRINGE ON THEIR INTELLECTUAL PROPERTY RIGHTS, WE MAY BE SUBJECT TO COSTLY AND TIME-CONSUMING LITIGATION AND DELAYS IN PRODUCT INTRODUCTION. Our processes and potential products may conflict with patents that have been or may be granted to competitors, academic institutions or others. As the biotechnology and pharmaceutical industries expand and more patents are filed and issued, the risk increases that our product candidates may give rise to a declaration of interference by the U.S. Patent and Trademark Office, to administrative proceedings in foreign patent offices or to claims of patent infringement by other companies, institutions or individuals. These entities or persons could bring legal proceedings against us seeking substantial damages or seeking to enjoin us from testing, manufacturing or marketing our products. If any of these actions were successful, we may also be required to cease the infringing activity or obtain the requisite licenses or rights to use the technology that may not be available to us on acceptable terms, if at all. Any litigation, regardless of the outcome, could be extremely costly to us. WE HAVE OUTSTANDING OPTIONS, CONVERTIBLE DEBT, CONTINGENT VALUE RIGHTS AND WARRANTS, THE EXERCISE, CONVERSION OR EXCHANGE OF WHICH COULD DILUTE STOCKHOLDER VALUE AND CAUSE OUR STOCK PRICE TO DECLINE. We grant stock options to our employees and other individuals as part of our overall compensation plan which, upon vesting, are exercisable for common stock. In addition, we have issued convertible debt which may be converted into common stock as well as contingent value rights which, upon the occurrence of certain events, may be exchanged for common stock. We are not able to estimate when, if ever, the stock options or convertible debt will be exercised or converted into common stock or when, if ever, shares will be issued in connection with the contingent value rights, but any such conversion or issuance would almost certainly dilute stockholder value. Further, if some or all of such shares are registered and sold into the public market over a short time period, the price of our stock is likely to decline, as the market may not be able to absorb those shares at the prevailing market prices. OUR OUTSTANDING INDEBTEDNESS INCREASED SUBSTANTIALLY WITH THE ISSUANCE OF CONVERTIBLE SENIOR SUBORDINATED NOTES IN SEPTEMBER 2003, OR THE 2023 NOTES, AND WE MAY NOT BE ABLE TO MAKE THE REQUIRED PAYMENTS ON THESE NOTES WHEN DUE AND THEREFORE MAY FACE LIQUIDITY PROBLEMS. As a result of the issuance of our 2023 Notes, our long-term debt represented by these notes was $150 million as of December 31, 2004. Our 2023 Notes significantly increased our interest expense and related debt service costs. Interest on these notes accrues at the rate of 3.25% per annum. This amounts to interest payments of $2.4 million due and payable on the 2023 Notes semi-annually on March 8 and September 8 of each year on the outstanding amount of the notes. Total interest payments of $92.6 million are scheduled to be paid between March 8, 2005 and September 8, 2023 on the 2023 Notes. 7 This long-term debt may: - make it more difficult for us to obtain any necessary financing in the future for working capital, capital expenditures, debt service requirements or other purposes; and - make us more vulnerable in the event of a downturn in our business. We currently are not generating sufficient net cash flow to satisfy the annual debt service payments on the notes. If we are unable to satisfy our debt service requirements, we will default on our 2023 Notes, and we would face liquidity problems as a result. IF THE MARKET PRICE OF OUR COMMON STOCK, SIMILAR TO OTHER BIOTECHNOLOGY COMPANIES, REMAINS HIGHLY VOLATILE, THEN OUR STOCKHOLDERS MAY NOT BE ABLE TO SELL THEIR STOCK WHEN DESIRED OR AT DESIRABLE PRICES. When the stock prices of companies in the Nasdaq Biotechnology Index fall, our stock price will most likely fall as well. The stock price of biotechnology and pharmaceutical companies, including our stock price, has been volatile and may remain volatile for the foreseeable future. From October 1, 2001 through September 30, 2002, the range of our stock price was between $50.94 and $11.50, and the range of the Nasdaq Biotechnology Index was between 978.42 and 397.36. From October 1, 2002 through September 30, 2003, the range of our stock price was between $38.34 and $12.84, and the range of the Nasdaq Biotechnology Index was between 801.40 and 442.09. From October 1, 2003 through September 30, 2004, the range of our stock price was between $98.70 and $24.47, and the range of the Nasdaq Biotechnology Index was between 851.44 and 622.01. From October 1, 2004 through April 8, 2005, the range of our stock price was between $74.95 and $39.48 and the range of the Nasdaq Biotechnology Index was between 774.43 and 636.66. The following factors, among others, some of which are beyond our control, may also cause our stock price to decline: - sales of Tarceva; - fluctuations in operating results; - announcements of technological innovations or new therapeutic products by others; - negative or neutral clinical trial results; - developments concerning strategic alliance agreements; - unanticipated clinical efficacy or safety results from our competitors' products; - changes in government regulation, including pricing controls; - delays with the FDA in the approval process for clinical candidates; - developments in patent or other proprietary rights; - public concern as to the safety of our products; - future sales of substantial amounts of our common stock by existing stockholders; and - comments by securities analysts and general market conditions. In addition, historically, our stock price has been affected by technological, clinical and regulatory developments in the HER1/EGFR field, including developments with respect to the products of our main competitors in the field. It is possible that future developments concerning our competitors' products as well as further research and clinical results of targeted therapies in general and the HER1/EGFR field in particular could have an impact on our stock price due to Tarceva's classification as a targeted therapy in the HER1/EGFR field. If our stock price falls, our stockholders may not be able to sell their stock when desired or at desirable prices. 8 OUR GOVERNANCE DOCUMENTS AND STATE LAW PROVIDE CERTAIN ANTI-TAKEOVER MEASURES WHICH WILL DISCOURAGE A THIRD PARTY FROM SEEKING TO ACQUIRE US AND MAY IMPEDE THE ABILITY OF STOCKHOLDERS TO REMOVE AND REPLACE OUR BOARD OF DIRECTORS AND, THEREFORE, OUR MANAGEMENT. We have had a shareholder rights plan, commonly referred to as a "poison pill," since January 1999. The purpose of the shareholder rights plan is to protect stockholders against unsolicited attempts to acquire control of us that do not offer a fair price to our stockholders as determined by our board of directors. Under the plan, the acquisition of 17.5% or more of our outstanding common stock by any person or group, unless approved by our board of directors, will trigger the right by our stockholders to acquire additional shares of our common stock, and, in certain cases, the stock of the potential acquiror, at a bargain purchase price, thus significantly increasing the acquisition cost to a potential acquiror. The shareholder rights plan may have the effect of dissuading a potential hostile acquiror from making an offer for our common stock at a price that represents a premium to the then current trading price. Our certificate of incorporation and by-laws contain certain additional anti-takeover protective devices. For example, - no stockholder action may be taken without a meeting, without prior notice and without a vote; solicitations by consent are thus prohibited; - special meetings of stockholders may be called only by our board of directors; - nominations by stockholders of candidates for election to the board of directors at our annual meeting of stockholders must be made at least 45 days prior to the date on which we first mailed our proxy materials for the prior year's annual meeting of stockholders; and - our board of directors has the authority, without further action by the stockholders, to fix the rights and preferences, and issue shares, of preferred stock. An issuance of preferred stock with dividend and liquidation rights senior to the common stock and convertible into a large number of shares of common stock could prevent a potential acquiror from gaining effective economic or voting control. Further, we are subject to Section 203 of the Delaware General Corporation Law which, subject to certain exceptions, restricts certain transactions and business combinations between a corporation and a stockholder owning 15% or more of the corporation's outstanding voting stock for a period of three years from the date the stockholder becomes a 15% stockholder. In addition to discouraging a third party from acquiring control of us, the foregoing provisions could impair the ability of existing stockholders to remove and replace our management and/or our board of directors. 9 RECENT EVENTS As of April 14, 2005, we exchanged 0.29685 shares of our common stock, totaling 84,940 shares, for each share of Prosidion Limited stock held by the stockholders listed below under the section entitled "Selling Stockholders." We agreed to file the registration statement, of which this prospectus is a part, which enables the selling stockholders to sell their shares. We also agreed to reimburse the selling stockholders for liability we may cause if we make any untrue statements of material fact or failing to state a material fact in this registration statement. USE OF PROCEEDS The proceeds from the sale of the shares of common stock are solely for the account of the selling stockholders. We will not receive any proceeds from the sale of the shares. SELLING STOCKHOLDERS The table below describes the amount of common stock owned by the selling stockholders as of April 14, 2005 and the number of shares of common stock the selling stockholders are selling under this prospectus.
PERCENTAGE OF PERCENTAGE OF SHARES SHARES OWNED SHARES OWNED SHARES OFFERED PRIOR TO AFTER SELLING STOCKHOLDERS OWNED(1) HEREBY OFFERING(2) OFFERING(2) - -------------------- -------- ------- ------------- ------------- Arch, Jon(3)............................. 237 237 * * Bali, Utsav(4)........................... 306 296 * * Bradley, Stuart(4)....................... 2,103 593 * * Cherrington, Alan(3)..................... 737 237 * * Christiansen, Lars(4).................... 4,452 4,452 * * Darker, Sinead(5)........................ 296 296 * * Demuth, Hans-Ulrich(3)................... 237 237 * * Doel, Sheila(4).......................... 534 445 * * Fyfe, Matthew(4)......................... 831 831 * * Gadher, Smita(4)......................... 445 445 * * Gardner, Lisa(4)......................... 296 296 * * Hueg, Kim(6)............................. 445 445 * * Jeevaratnam, Revathy(4).................. 296 296 * * Keily, John(4)........................... 593 593 * * Krulle, Thomas(4)........................ 593 593 * * Lundbeck Research USA, Inc. ............. 14,842 14,842 * * Lundemose, Anker(7)(8)................... 13,358 13,358 * * Matthews, David(3)....................... 237 237 * * Murray, John(5).......................... 3,711 2,968 * * O'Rahilly, Stephen(3).................... 237 237 * * Overton, Hilary(4)....................... 831 831 * * Petkevich, Misha(8)...................... 396 296 * * Procter, Martin(4)....................... 1,291 1,038 * * Rasamison, Chrystelle(4)................. 296 296 * * Reynet-McCormack, Christine(4)........... 1,484 1,484 * * Rowley, Robert(4)........................ 568 445 * * Schofield, Karen(4)...................... 296 296 * * Shah, Vilas(4)........................... 1,213 445 * * Tanabe Seiyaku Co. Ltd. ................. 29,684 29,684 * * Thomas, Gerard(4)........................ 831 831 * *
10
PERCENTAGE OF PERCENTAGE OF SHARES SHARES OWNED SHARES OWNED SHARES OFFERED PRIOR TO AFTER SELLING STOCKHOLDERS OWNED(1) HEREBY OFFERING(2) OFFERING(2) - -------------------- -------- ------- ------------- ------------- Thomsen, Mikael(4)....................... 5,936 5,936 * * Williams, Geoffrey(4).................... 1,109 593 * * Wong Kai in, Phil(4)..................... 831 831 * *
- --------------- * Represents less than one percent. (1) Based on information provided by the Selling Stockholders. Excludes stock options potentially held. (2) Based on shares of common stock issued and outstanding as of April 20, 2005. (3) Consultant to Prosidion Limited, our wholly-owned subsidiary. (4) Employee of Prosidion. (5) Former employee of Prosidion. (6) Former member of the Board of Directors of Prosidion. (7) Chief Executive Officer of Prosidion. (8) Member of the Board of Directors of Prosidion. 11 PLAN OF DISTRIBUTION Any distribution hereunder of the shares by the selling stockholders may be effected from time to time in one or more of the following transactions: - through brokers, acting as principal or agent, in transactions (which may involve block transactions) on Nasdaq or otherwise, in special offerings, in the over-the-counter market, or otherwise, at market prices obtainable at the time of sale, at prices related to such prevailing market prices, at negotiated prices or at fixed prices, - to underwriters who will acquire the shares for their own account and resell them in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale (any public offering price and any discount or concessions allowed or reallowed or paid to dealers may be changed from time to time), - directly or through brokers or agents in private sales at negotiated prices, - to lenders pledged as collateral to secure loans, credit or other financing arrangements and any subsequent foreclosure, if any, thereunder, or - combination of any of the foregoing or by any other legally available means. Also, offers to purchase shares may be solicited by agents designated by the selling stockholders from time to time. Underwriters or other agents participating in an offering made pursuant to this prospectus (as amended or supplemented from time to time) may receive underwriting discounts and commissions under the Securities Act of 1933, or Securities Act, as amended, and discounts or concessions may be allowed or reallowed or paid to dealers, and brokers or agents participating in such transactions may receive brokerage or agent's commissions or fees. The selling stockholders may effect sales of shares to or through broker-dealers, and such broker-dealers may receive compensation in the form of discounts, concessions or commissions from the selling stockholders and/or the purchasers of the shares for whom such broker-dealers may act as agents or to whom they sell as principals, or both (which compensation as to a particular broker-dealer might be in excess of customary commissions). At the time a particular offering of any shares is made hereunder, to the extent required by law, a prospectus supplement will be distributed which will set forth the amount of shares being offered and the terms of the offering, including the purchase price or public offering price, the name or names of any underwriters, dealers or agents, the purchase price paid by any underwriter for any shares purchased from the selling stockholders, any discounts, commissions and other items constituting compensation from the selling stockholders and any discounts, commissions or concessions allowed or filed or paid to dealers. The shares may be sold from time to time in one or more transactions at a fixed offering price, which may be changed, or at varying prices determined at the time of sale or at negotiated prices. Such prices will be determined by the selling stockholders or by agreement between the selling stockholders and underwriters or dealers, if any. The selling stockholders also may, from time to time, authorize dealers, acting as selling stockholders' agents, to solicit offers to purchase the shares upon the terms and conditions set forth in any prospectus supplement. In order to comply with the securities laws of certain states, if applicable, the shares will be sold hereunder in such jurisdictions only through registered or licensed brokers or dealers. We have been advised that, as of the date hereof, the selling stockholders have made no arrangements with any broker for the sale of their shares. The selling stockholders and any underwriters, brokers or dealers involved in the sale of the shares may be considered "underwriters" as that term is defined by the Securities Act although the selling stockholders disclaim such status. We have agreed to reimburse the selling stockholders against certain liabilities that may be incurred in connection with the sale of the shares under this prospectus. In addition, the selling stockholders have agreed to reimburse us against certain liabilities. We have agreed to pay certain expenses incident to the registration statement and the sale of the shares hereunder to the public, other than certain internal administrative and similar costs of the selling stockholders, legal fees and expenses of counsel for the selling stockholders and any underwriting discount and commissions, selling or placement agent or broker fees or commissions, and transfer taxes, if 12 any, in connection with the sale of securities by the selling stockholders. We will not receive any proceeds from any sales of the shares pursuant to this prospectus. Each selling stockholder will be subject to applicable provisions of the Securities Exchange Act of 1934, or Exchange Act, as amended, and the rules and regulations thereunder, including, without limitation, Regulation M, which provisions may limit the timing of purchases and sales of shares of our common stock by the selling stockholders. AVAILABLE INFORMATION We have filed a registration statement, of which this prospectus is a part, and related exhibits with the Securities and Exchange Commission, or SEC, pursuant to the Securities Act. The registration statement contains additional information about us and our common stock. We also filed annual and quarterly reports, proxy statements and other information with the SEC. You may read and copy the registration statement or any other document we file with the SEC at the SEC's Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the Public Reference Room. The SEC also maintains a website that contains reports, proxy and information statements, and other information that we have filed electronically. The SEC's website is located at http://www.sec.gov. We maintain our own website which is located at http://www.osip.com. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The SEC allows us to "incorporate by reference" the information we provide in documents filed with the SEC, which means that we can disclose important information by referring to those documents. The information incorporated by reference is an important part of this prospectus. Any statement contained in a document which is incorporated by reference in this prospectus is automatically updated and superseded if information contained in this prospectus, or information that we later file with the SEC, modifies and replaces this information. We incorporate by reference the following documents we have filed with the SEC: 1. annual report on Form 10-K for the fiscal year ended September 30, 2004, filed with the SEC on December 14, 2004; 2. current reports on Form 8-K, filed with the SEC on October 21, 2004, November 4, 2004, November 19, 2004 as amended on November 24, 2004, November 24, 2004, December 16, 2004, January 27, 2005, February 8, 2005, March 8, 2005, March 21, 2005, March 30, 2005, April 5, 2005, April 12, 2005, April 20, 2005 and April 22, 2005; 3. item 8.01 and exhibit 99.2 of the current report on Form 8-K filed with the SEC on February 11, 2005; 4. transition report on Form 10-Q for the period ended December 31, 2004, filed with the SEC on February 9, 2005; 5. proxy statement, dated February 2, 2005, for our 2005 annual meeting of stockholders, filed with the SEC on January 28, 2005; and 6. the description of our common stock, which is registered under Section 12 of the Exchange Act, contained in our registration statement on Form 8-A, including any amendments or reports filed for the purpose of updating such description. All documents we have filed with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this prospectus (other than respective filings or portions of filings that are furnished, under applicable SEC rules, rather than filed) will be deemed incorporated by references in this prospectus and will become a part of this prospectus. To receive a free copy of any of the documents incorporated by reference in this prospectus call or write Robert L. Van Nostrand, Vice President and Chief Financial Officer, OSI Pharmaceuticals, Inc., 58 South Service Road, Suite 110, Melville, New York 11747, (631) 962-2000. We will not send exhibits to the documents unless those exhibits have been specifically incorporated by reference in this prospectus. You should rely only on the information incorporated by reference or included in this prospectus or the applicable prospectus supplement. We have not authorized anyone else to provide you with different information. The selling stockholders may only use this prospectus to sell securities if a prospectus supplement is delivered with the prospectus, to the extent one is required. The selling stockholders are only 13 offering these securities in states where the offer is permitted. You should not assume that the information in this prospectus or the applicable prospectus supplement is accurate as of any date other than the dates set forth on the front of these documents. LEGAL MATTERS Saul Ewing LLP, Philadelphia, Pennsylvania, will pass upon the validity of the shares of common stock offered in this prospectus by us. EXPERTS The consolidated financial statements of OSI Pharmaceuticals, Inc. and its subsidiaries as of September 30, 2004 and 2003, and for each of the years in the three-year period ended September 30, 2004, have been incorporated by reference herein and in the registration statement in reliance upon the report of KPMG LLP, independent registered public accounting firm, incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing. The audit report covering the September 30, 2004 consolidated financial statements reflects (i) the adoption of EITF 00-21 "Revenue Arrangements with Multiple Deliverables" in 2004; (ii) the full adoption of the provisions of Statement of Financial Accounting Standards, "SFAS", No. 142, "Goodwill and Other Intangible Assets" in 2003; and (iii) the early adoption of the provisions of SFAS No. 145 "Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections" relating to the classification of the effect of early debt extinguishments in 2002. 14 You should rely only on the information contained in this prospectus or incorporated by reference. We have not authorized anyone to provide you with additional or different information. We are not making an offer of these securities in any jurisdiction where the offer or sale is not permitted. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus, regardless of the date of delivery of this prospectus or the date of any sale of the securities. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 84,940 SHARES (OSI LOGO) COMMON STOCK ------------------------ PROSPECTUS ------------------------ APRIL , 2005 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. The following expenses incurred in connection with the sale of the securities being registered will be borne by OSI. Other than the SEC registration fee, the amounts stated are estimates. SEC registration fee........................................ $ 478.38 Accounting fees and expenses................................ 10,000 Legal fees and expenses..................................... 25,000 ---------- Total..................................................... $35,478.38
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Section 145 of the General Corporation Law of Delaware empowers a corporation to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he or she is or was a director, officer, employee or agent of the corporation or another enterprise if serving such enterprise at the request of the corporation. Depending on the character of the proceeding, a corporation may indemnify against expenses (including attorney's fees), judgments, fines and amounts paid in settlement actually and reasonably incurred in connection with such action, suit or proceeding if the person indemnified acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. In the case of an action by or in the right of the corporation, no indemnification may be made in respect to any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine that despite the adjudication of liability, but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses that the court shall deem proper. Section 145 further provides that to the extent a director or officer of a corporation has been successful in the defense of any action, suit or proceeding referred to above, or in defense of any claim, issue or matter therein, he or she shall be indemnified against expenses (including attorney's fees) actually and reasonably incurred by him or her in connection therewith. OSI's Certificate of Incorporation provides that OSI shall, to the fullest extent authorized by the General Corporation Law of Delaware, indemnify any person, or the legal representative of any person, who is or was a director, officer, employee or agent of OSI or another enterprise if said person served such enterprise at the request of OSI. The Certificate of Incorporation also provides that any amendment to the General Corporation Law of Delaware shall only be applicable to the extent any such amendment permits OSI to provide broader indemnification rights than said law permitted OSI to provide prior to such amendment. The Certificate of Incorporation further provides that in the case of an action, suit or proceeding initiated by the indemnified person, OSI shall indemnify the person only if such action, suit or proceeding was authorized by OSI's Board of Directors. The Certificate of Incorporation also contains a provision eliminating the liability of directors of OSI to OSI or its stockholders for monetary damages for breach of fiduciary duty except under certain specified circumstances. The Certificate of Incorporation also permits OSI to maintain insurance to protect itself and any director, officer, employee or agent against any liability with respect to which OSI would have the power to indemnify such persons under the General Corporation Law of Delaware. OSI maintains an insurance policy insuring its directors and officers against certain liabilities. II-1 ITEM 16. EXHIBITS. The following is a list of exhibits filed as part of the Registration Statement: 4.1 Form of Deed of Share Exchange Relating to the Shares of Prosidion Limited pursuant to Regulation S under the Securities Act of 1933 ("Regulation S Deed"). Certain of the selling stockholders, as listed below, have executed Deeds of Share Exchange Relating to the Shares of Prosidion Limited which are substantially identical to the Regulation S Deed except as to the following material differences: the identity of the parties, the number of Prosidion shares exchanged, the number of OSI shares of common stock received, and Section 3.3(c).
PROSIDION PARTY SHARES OSI SHARES SECTION 3.3(C) - ----- --------- ---------- -------------- Arch, Jon.......................... 800 237 No change Bali, Utsav........................ 1,000 296 No change Bradley, Stuart.................... 2,000 593 No change Christiansen, Lars................. 15,000 4,452 No change Darker, Sinead..................... 1,000 296 Section 3.3(c) is as follows: The Member agrees to not engage in any hedging transactions with regard to the Consideration Stock unless in compliance with the Securities Act. Demuth, Hans-Ulrich................ 800 237 No change Doel, Sheila....................... 1,500 445 No change Fyfe, Matthew...................... 2,800 831 No change Gadher,Smita....................... 1,500 445 No change Gardner, Lisa...................... 1,000 296 No change Hueg, Kim.......................... 1,500 445 No change Jeevaratnam, Revathy............... 1,000 296 No change Keily, John........................ 2,000 593 No change Krulle, Thomas..................... 2,000 593 No change Lundemose, Anker................... 45,000 13,358 No change Matthews, David.................... 800 237 No change Murray, John....................... 10,000 2,968 Section 3.3(c) is as follows: The Member agrees to not engage in any hedging transactions with regard to the Consideration Stock unless in compliance with the Securities Act. O'Rahilly, Stephen................. 800 237 No change Overton, Hilary.................... 2,800 831 No change Procter, Martin.................... 3,500 1,038 No change Rasamison, Chrystelle.............. 1,000 296 No change Reynet McCormack, Christine........ 5,000 1,484 No change Rowley, Robert..................... 1,500 445 No change Schofield, Karen................... 1,000 296 No change Shah, Vilas........................ 1,500 445 No change Thomas, Gerard..................... 2,800 831 No change Thomsen, Mikael.................... 20,000 5,936 No change Williams, Geoffrey................. 2,000 593 No change Wong Kai in, Phil.................. 2,800 831 No change
II-2 4.2 Form of Deed of Share Exchange Relating to the Shares of Prosidion Limited pursuant to Regulation D under the Securities Act of 1933 ("Regulation D Deed"). Certain of the selling stockholders, as listed below, have executed Deeds of Share Exchange Relating to the Shares of Prosidion Limited which are substantially identical to the Regulation D Deed except as to the following material differences: the identity of the parties, the number of Prosidion shares exchanged, the number of OSI shares of common stock received, and certain provisions as set forth below.
PROSIDION OSI PARTY SHARES SHARES PROVISIONS - ----- --------- ------ ---------- Cherrington, Alan................... 800 237 No differing provisions Petkevich, Misha.................... 1,000 296 No differing provisions Tanabe Seiyaku Co. Ltd.............. 100,000 29,684 Section 3.3(c) is Section 3.3(b) of the Regulation D Deed. Section 3.3(b) is as follows: The Member acknowledges and agrees that no action has been or is intended to be taken in any jurisdiction outside the United States by the Parent Company that would permit an offering of the Consideration Stock or possession or distribution of offering materials in connection with the issuance of the Consideration Stock, in any jurisdiction outside the United States where legal action by the Parent Company for that purpose is required. The Member outside the United States will comply with all applicable laws and regulations in each foreign jurisdiction in which it purchases, offers, sells or delivers Consideration Stock or has in its possession or distributes any offering material, in all cases at its own expense. Lundbeck Research USA, Inc.......... 50,000 14,842 Section 3.3(a) is as follows: 3.3(a): Member will not, directly or indirectly, offer, sell, pledge, transfer or otherwise dispose of or solicit any offers to buy any of the Consideration Stock except in compliance with the Securities Act and applicable state securities laws. In furtherance thereof, the Member will not make any disposition of the Consideration Stock except (i) pursuant to a registration statement under the Securities Act covering such proposed disposition or exemption from the registration requirements thereunder, (ii) upon prior notice to the Parent Company and, if reasonably requested by the Parent Company, delivery to the Parent Company of an opinion of counsel, reasonably satisfactory to the Parent Company, that such disposition will not require registration under the Securities Act, or (iii) in compliance with Rule 144 under the Securities Act.
II-3
PROSIDION OSI PARTY SHARES SHARES PROVISIONS - ----- --------- ------ ---------- Section 11.1 is as follows: 11.1: Any delay by the parties in exercising, or failure to exercise, any right or remedy under this Deed shall not constitute a waiver of the right or remedy or a waiver of any other rights or remedies and no single or partial exercise of any rights or remedy under this Deed or otherwise shall prevent any further exercise of the right or remedy or the exercise of any other right or remedy. No waiver shall be effective unless in writing and signed by the party to be charged therewith. Section 14.1 is as follows: 14.1: This Deed shall be governed by and construed in accordance with the laws of the Sate of New York, USA. Section 14.2 is as follows: 14.2: In relation to any legal action or proceedings arising out of or in connection with this Deed ("Proceedings"), each of the parties irrevocably submits to the non-exclusive jurisdiction of the US federal or New York state courts within the New York counties of New York or Nassau and waives any objection to Proceedings in such courts on the grounds of venue or on the grounds that Proceedings have been brought in an inappropriate forum.
5.1 Opinion of Saul Ewing LLP as to the legality of the securities registered hereunder 23.1 Consent of KPMG LLP 23.2 Consent of Saul Ewing LLP (included in Exhibit 5.1) 24.1 Power of Attorney (contained on Signature Page) ITEM 17. UNDERTAKINGS. A. Rule 415 Offering The undersigned Registrant hereby undertakes: (1) to file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement; (i) to include any prospectus required by section 10(a)(3) of the Securities Act of 1933; (ii) to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range II-4 may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement. (iii) to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; Provided, however, that paragraphs (1)(i) and (1)(ii) above do not apply if the registration statement is on Form S-3 or Form S-8, and the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement. (2) that, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) to remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. B. Filing Incorporating Subsequent Exchange Act Documents By Reference. The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration 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. Request for Acceleration of Effective Date Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. II-5 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Melville, State of New York, on April 22, 2005. OSI PHARMACEUTICALS, INC. By: /s/ COLIN GODDARD, PH.D. ------------------------------------ Colin Goddard, Ph.D. Chief Executive Officer POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below hereby makes, constitutes and appoints Colin Goddard, Ph.D. and Robert L. Van Nostrand, and each of them, with full power to act without the other, his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities to sign any and all amendments to this registration statement, including post-effective amendments, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in connection therewith, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed by the following persons in the capacities and on the dates indicated.
SIGNATURE TITLE DATE --------- ----- ---- /s/ ROBERT A. INGRAM Chairman of the Board April 22, 2005 ------------------------------------------------ Robert A. Ingram /s/ COLIN GODDARD, PH.D. Director and Chief Executive Officer April 22, 2005 ------------------------------------------------ (principal executive officer) Colin Goddard, Ph.D. /s/ ROBERT L. VAN NOSTRAND Vice President, Chief Financial April 22, 2005 ------------------------------------------------ Officer (principal financial and Robert L. Van Nostrand accounting officer) /s/ MICHAEL ATIEH Director April 22, 2005 ------------------------------------------------ Michael Atieh /s/ G. MORGAN BROWNE Director April 22, 2005 ------------------------------------------------ G. Morgan Browne Director April , 2005 ------------------------------------------------ Daryl K. Granner, M.D.
II-6
SIGNATURE TITLE DATE --------- ----- ---- /s/ WALTER M. LOVENBERG PH.D. Director April 22, 2005 ------------------------------------------------ Walter M. Lovenberg Ph.D. /s/ VIREN MEHTA Director April 22, 2005 ------------------------------------------------ Viren Mehta Director April , 2005 ------------------------------------------------ Herbert Pinedo, M.D., Ph.D. /s/ SIR MARK RICHMOND, PH.D. Director April 22, 2005 ------------------------------------------------ Sir Mark Richmond, Ph.D. Director April , 2005 ------------------------------------------------ John P. White, Esquire
II-7 EXHIBIT INDEX EXHIBIT NO. 4.1 Form of Deed of Share Exchange Relating to the Shares of Prosidion Limited pursuant to Regulation S under the Securities Act of 1933 ("Regulation S Deed"). Certain of the selling stockholders, as listed below, have executed Deeds of Share Exchange Relating to the Shares of Prosidion Limited which are substantially identical to the Regulation S Deed except as to the following material differences: the identity of the parties, the number of Prosidion shares exchanged, the number of OSI shares of common stock received, and Section 3.3(c).
PROSIDION PARTY SHARES OSI SHARES SECTION 3.3(C) - ----- --------- ---------- -------------- Arch, Jon.......................... 800 237 No change Bali, Utsav........................ 1,000 296 No change Bradley, Stuart.................... 2,000 593 No change Christiansen, Lars................. 15,000 4,452 No change Darker, Sinead..................... 1,000 296 Section 3.3(c) is as follows: The Member agrees to not engage in any hedging transactions with regard to the Consideration Stock unless in compliance with the Securities Act. Demuth, Hans-Ulrich................ 800 237 No change Doel, Sheila....................... 1,500 445 No change Fyfe, Matthew...................... 2,800 831 No change Gadher,Smita....................... 1,500 445 No change Gardner, Lisa...................... 1,000 296 No change Hueg, Kim.......................... 1,500 445 No change Jeevaratnam, Revathy............... 1,000 296 No change Keily, John........................ 2,000 593 No change Krulle, Thomas..................... 2,000 593 No change Lundemose, Anker................... 45,000 13,358 No change Matthews, David.................... 800 237 No change Murray, John....................... 10,000 2,968 Section 3.3(c) is as follows: The Member agrees to not engage in any hedging transactions with regard to the Consideration Stock unless in compliance with the Securities Act. O'Rahilly, Stephen................. 800 237 No change Overton, Hilary.................... 2,800 831 No change Procter, Martin.................... 3,500 1,038 No change Rasamison, Chrystelle.............. 1,000 296 No change Reynet McCormack, Christine........ 5,000 1,484 No change Rowley, Robert..................... 1,500 445 No change Schofield, Karen................... 1,000 296 No change Shah, Vilas........................ 1,500 445 No change Thomas, Gerard..................... 2,800 831 No change Thomsen, Mikael.................... 20,000 5,936 No change Williams, Geoffrey................. 2,000 593 No change Wong Kai in, Phil.................. 2,800 831 No change
4.2 Form of Deed of Share Exchange Relating to the Shares of Prosidion Limited pursuant to Regulation D under the Securities Act of 1933 ("Regulation D Deed"). Certain of the selling stockholders, as listed below, have executed Deeds of Share Exchange Relating to the Shares of Prosidion Limited which are substantially identical to the Regulation D Deed except as to the following material differences: the identity of the parties, the number of Prosidion shares exchanged, the number of OSI shares of common stock received, and certain provisions as set forth below.
PROSIDION OSI PARTY SHARES SHARES PROVISIONS - ----- --------- ------ ---------- Cherrington, Alan................... 800 237 No differing provisions Petkevich, Misha.................... 1,000 296 No differing provisions Tanabe Seiyaku Co. Ltd.............. 100,000 29,684 Section 3.3(c) is Section 3.3(b) of the Regulation D Deed. Section 3.3(b) is as follows: The Member acknowledges and agrees that no action has been or is intended to be taken in any jurisdiction outside the United States by the Parent Company that would permit an offering of the Consideration Stock or possession or distribution of offering materials in connection with the issuance of the Consideration Stock, in any jurisdiction outside the United States where legal action by the Parent Company for that purpose is required. The Member outside the United States will comply with all applicable laws and regulations in each foreign jurisdiction in which it purchases, offers, sells or delivers Consideration Stock or has in its possession or distributes any offering material, in all cases at its own expense. Lundbeck Research USA, Inc.......... 50,000 14,842 Section 3.3(a) is as follows: 3.3(a): Member will not, directly or indirectly, offer, sell, pledge, transfer or otherwise dispose of or solicit any offers to buy any of the Consideration Stock except in compliance with the Securities Act and applicable state securities laws. In furtherance thereof, the Member will not make any disposition of the Consideration Stock except (i) pursuant to a registration statement under the Securities Act covering such proposed disposition or exemption from the registration requirements thereunder, (ii) upon prior notice to the Parent Company and, if reasonably requested by the Parent Company, delivery to the Parent Company of an opinion of counsel, reasonably satisfactory to the Parent Company, that such disposition will not require registration under the Securities Act, or (iii) in compliance with Rule 144 under the Securities Act.
PROSIDION OSI PARTY SHARES SHARES PROVISIONS - ----- --------- ------ ---------- Section 11.1 is as follows: 11.1: Any delay by the parties in exercising, or failure to exercise, any right or remedy under this Deed shall not constitute a waiver of the right or remedy or a waiver of any other rights or remedies and no single or partial exercise of any rights or remedy under this Deed or otherwise shall prevent any further exercise of the right or remedy or the exercise of any other right or remedy. No waiver shall be effective unless in writing and signed by the party to be charged therewith. Section 14.1 is as follows: 14.1: This Deed shall be governed by and construed in accordance with the laws of the Sate of New York, USA. Section 14.2 is as follows: 14.2: In relation to any legal action or proceedings arising out of or in connection with this Deed ("Proceedings"), each of the parties irrevocably submits to the non-exclusive jurisdiction of the US federal or New York state courts within the New York counties of New York or Nassau and waives any objection to Proceedings in such courts on the grounds of venue or on the grounds that Proceedings have been brought in an inappropriate forum.
5.1 Opinion of Saul Ewing LLP as to the legality of the securities registered hereunder 23.1 Consent of KPMG LLP 23.2 Consent of Saul Ewing LLP (included in Exhibit 5.1) 24.1 Power of Attorney (contained on Signature Page) EX-4.1 2 y08089exv4w1.txt EX-4.1: FORM OF DEED OF SHARE EXCHANGE EXHIBIT 4.1 DATED 2005 OSI PHARMACEUTICALS, INC. (1) AND 'FIRST-NAME' 'SURNAME' (2) --------------------------------------------------------------- DEED OF SHARE EXCHANGE RELATING TO THE SHARES OF PROSIDION LIMITED --------------------------------------------------------------- TABLE OF CONTENTS Definitions and Interpretation.............................. 1 1 Exchange of Shares.......................................... 2 2 Representations............................................. 3 2 Completion.................................................. 4 4 Further Assurance........................................... 5 5 Invalidity.................................................. 6 5 Non-Assignment.............................................. 7 5 Notices..................................................... 8 5 Third Party Rights.......................................... 9 6 Variation................................................... 10 6 Waiver...................................................... 11 6 Entire Agreement............................................ 12 6 Counterparts................................................ 13 6 Governing Law............................................... 14 6
DEED OF SHARE EXCHANGE THIS DEED is made the day of 2005 BETWEEN: (1) OSI PHARMACEUTICALS, INC., a company incorporated under the laws of the state of Delaware, USA and having its registered office at 58 South Service Road, Melville, New York, 11747, USA (the "PARENT COMPANY"); and (2) 'FIRST-NAME' 'SURNAME' of 'Address-1', 'Address-2', 'Address-3', 'Address-4' 'Address-5' (the "MEMBER"), (each a "PARTY" and collectively the "PARTIES"). RECITALS: (A) WHEREAS Prosidion Limited was incorporated under the laws of England and Wales on 25 November 2002 (registered number 4600121) and has an authorised share capital of 2,000 pound divided into 14,000,000 Preferred Ordinary Shares of 0.0001 Pound each ("PREFERRED ORDINARY SHARES"); 4,000,000 A Ordinary Shares of 0.0001 Pound each ("A ORDINARY SHARES"); and 2,000,000 B Ordinary Shares of 0.0001 ("B ORDINARY SHARES") each. (B) WHEREAS 'FounderIIBIIShares' B Ordinary Shares (the "SHARES") have been issued and allotted to the Member. (C) WHEREAS the Member is the legal and beneficial owner of the Shares. (D) WHEREAS the Parent Company has proposed to acquire all of the Shares from the Member in exchange for common stock, par value $0.01 per share of the Parent Company ("PARENT COMPANY STOCK"). (E) WHEREAS the Member and the Parent Company have agreed to the exchange of the Shares in return for the issue of Parent Company Stock on the terms and conditions set out in this Deed. (F) WHEREAS, the offer and issuance of the Consideration Stock, as defined below, by the Parent Company is made pursuant to Regulation S under the Securities Act of 1933, as amended (the "SECURITIES ACT"). NOW IT IS AGREED AS FOLLOWS: 1 DEFINITIONS AND INTERPRETATION 1.1 In this Deed, subject to any express contrary indication: (a) words importing the singular shall include the plural and vice versa; (b) any reference to this Deed or any other agreement or document shall be construed as a reference to that agreement or document as it may have been, or may from time to time be, amended, varied, novated, replaced or supplemented; (c) any reference to a statute or enactment shall be construed as a reference to such statute as it may have been, or may from time to time be, amended or re-enacted and any subordinate legislation made or thing done, or may from time to time be done, under the statute or enactment provided that, as between the parties, no such amendment or modification shall apply for the purposes of this Deed to the extent that it would impose any new or extended obligation, liability or restriction on, or otherwise adversely affect the rights of, any party; and (d) any reference to any English legal term for any action, remedy, method of judicial proceeding, legal document, legal status, court, official, or any legal concept or thing shall in respect of any jurisdiction (other than England) be deemed to include what most nearly approximates in that jurisdiction to the English legal term. 1 1.2 All headings in this Deed are for ease of reference only and shall not affect the interpretation of this Deed. 1.3 Capitalised terms used in the Recitals and this Deed shall, unless the context otherwise requires, have the meaning set out in the Articles of Association of the Company. 2 EXCHANGE OF SHARES 2.1 EXCHANGE RATIO For the purposes of this Deed the Parent Company and the Member agree that the Shares shall be exchanged for Parent Company Stock on the basis of the following exchange ratio (the "EXCHANGE RATIO"): For each Share: 0.29685 shares of Parent Company Stock 2.2 NO FRACTIONAL SHARES No certificates representing fractional shares of the Parent Company Stock shall be issued, and such fractional share interests will not entitle the Member to vote or to any other rights of a stockholder of the Parent Company. With respect to any fractional share interest to which the Member is entitled, the Member shall be paid an amount in cash equal to the product obtained by multiplying (i) such fractional share interest to which the Member would otherwise be entitled by (ii) $53.90. 2.3 EXCHANGE OF SHARES At Completion, in consideration for the Parent Company issuing to the Member the 'OSIPIIShares' shares of Parent Company Stock (the "Consideration Stock"), the Member as legal and beneficial owner shall transfer its Shares to the Parent Company with full title guarantee free from any lien, claim, charge, security interest, mortgage, pledge, easement, conditional sale or other title retention agreement, defect in title, rights of third parties, restrictive covenant or other restrictions of any kind (each an "ENCUMBRANCE"). 3 REPRESENTATIONS AND COVENANTS 3.1 The Member represents and warrants to the Parent Company at the date hereof that: (a) he/she is the legal and beneficial owner of the Shares; (b) there is no Encumbrance on, over or affecting any of the Shares; (c) no agreement to create an Encumbrance has been entered into and no claim has been made by any person (natural or otherwise) that it is entitled to any such Encumbrance; and (d) he/she has full power and authority to enter into and exercise its rights and perform its obligations under this Deed and all other documents to be executed by him/her at Completion; (e) his/her obligations under this Deed are valid and binding subject to applicable law. 3.2 In respect of U.S. securities laws, the Member represents and warrants to the Parent Company at the date hereof that: (a) the Member is not a "U.S." person as defined in Regulation S under the Securities Act, (i.e., the Member is not resident in the United States); (b) the Member is not acquiring the Consideration Stock for the account or benefit of any other person; (c) the Member received a copy of this Deed from the Parent Company while the Member was outside of the United States and, when signed, will have signed this Deed and delivered a signed copy of this Deed to the Parent Company while the Member was outside of the United States; 2 (d) the Member (i) has been granted the opportunity to ask questions of, and receive answers from, representatives of the Parent Company concerning the terms and conditions of the exchange and (ii) has requested, received, reviewed and considered all information that he/she has deemed relevant in making an informed decision to acquire the Consideration Stock; (e) the Member has been advised of and understands the risks of an investment in the Consideration Stock; (f) the Member acknowledges that the acquisition of the Consideration Stock has not been registered under the Securities Act or registered or qualified under any U.S. state securities law in reliance on specific exemptions therefrom, which exemptions depend upon, among other things, the Member's representations and covenants as expressed in this Deed; (g) the Member has been informed and understands that the Consideration Stock may not be sold except (i) pursuant to a registration statement, (ii) pursuant to an exemption from registration, or (iii) in compliance with Rule 144 of the Securities Act (and is therefore subject to the holding requirements of Rule 144 of the Securities Act); (h) the Member has not undertaken any activities in the United States for the purpose of conditioning the market in the United States for the resale of the Consideration Stock by the Member or any other person acquiring securities of the Parent Company; and (i) the Member has no direct or indirect affiliation or association with any member of the National Association of Securities Dealers, Inc. in the United States (the "NASD"). 3.3 In respect of U.S. securities laws, the Member covenants with the Parent Company that: (a) The Member will not, directly or indirectly, offer, sell, pledge, transfer or otherwise dispose of or solicit any offers to buy any of the Consideration Stock except in compliance with the Securities Act and applicable state securities laws. In furtherance thereof, the Member will not make any disposition of the Consideration Stock except (i) pursuant to a registration statement under the Securities Act covering such proposed disposition, (ii) upon prior notice to the Parent Company and, if reasonably requested by the Parent Company, delivery to the Parent Company of an opinion of counsel, reasonably satisfactory to the Parent Company, that such disposition will not require registration under the Securities Act, or (iii) in compliance with Rule 144 under the Securities Act. (b) The Member acknowledges and agrees that no action has been or is intended to be taken in any jurisdiction outside the United States by the Parent Company that would permit an offering of the Consideration Stock or possession or distribution of offering materials in connection with the issuance of the Consideration Stock, in any jurisdiction outside the United States where legal action by the Parent Company for that purpose is required. The Member outside the United States will comply with all applicable laws and regulations in each foreign jurisdiction in which he/she purchases, offers, sells or delivers Consideration Stock or has in its possession or distributes any offering material, in all cases at his/her own expense. (c) The Member has been advised that he/she may not engage in any hedging transactions with regard to the Consideration Stock unless conducted in compliance with the Securities Act. However, the Member agrees that pursuant to the Parent Company's "Statement of Company Policy on Securities Trades by Company Personnel and Directors," he/she will not engage in any hedging transactions in the Consideration Stock or other securities of the Parent Company. (d) The Member understands and acknowledges that certificates evidencing the Consideration Stock shall bear one or all of the following legends or a similar legend: "The shares represented by this certificate have not been registered under the Securities Act of 1933, as amended (the "Act"), and may not be transferred without (i) an opinion of counsel satisfactory to the corporation that such transfer may lawfully be made without registration under such Act or qualification under applicable state securities laws; or (ii) such registration or 3 qualification. Hedging transactions involving the shares represented by this certificate may not be conducted unless in compliance with the Act." If required by the authorities of any state in the United States in connection with the issuance of sale of the Consideration Stock, the legend required by such state authority. Any purchaser of the Consideration Stock pursuant to an effective registration statement under the Securities Act will be entitled to receive a certificate bearing no restrictive legend. 4 COMPLETION 4.1 Completion shall take place at the offices of Prosidion Limited, Watlington Road, Oxford, OX4 6LT on April 14, 2005 (the "COMPLETION"). At Completion, the Member shall deliver to the Parent Company: (a) duly executed transfers of his/her Shares in favour of the Parent Company together with all share certificates relating to the Shares or, in the absence of which, an indemnity letter relating to loss of such share certificate; and (b) any other documents which may be required to vest in the Parent Company the full legal and beneficial ownership of the Shares and enable the Parent Company to procure them to be registered in its name or as it may direct. 4.2 At Completion the Member IRREVOCABLY AND UNCONDITIONALLY APPOINTS the Parent Company and each of Colin Goddard of 30 Allenby Drive, Fort Solonga, NY 11768, USA, Bob Van Nostrand of 15 Mariners Circle, West Islip, NY 11797, USA and Barbara Wood of 200 West 90th Street, Apartment 12F, New York, NY 10024, USA, each acting severally (each an "ATTORNEY") to be the true and lawful Attorney of the Member, with full power to appoint substitutes, pending registration of the Parent Company as the legal owner of the Shares and in his/her name or otherwise on his/her behalf as the Attorney sees fit to execute notices, instruments of proxy or other documents which may fall to be executed or signed by the Member and exercise and perform any of the acts and things to be done and performed by the Member in connection with the legal and beneficial ownership of all or any of the Shares held by the Member as if the Attorney were the legal and beneficial owner of such Shares and in particular but without limitation the Attorney is appointed to: (a) attend any General Meeting (Annual and/or Extraordinary) of the Company and to represent the Member and vote on the Member's behalf and in his/her name; (b) exercise in the Member's name and on his/her behalf, all rights and privileges attached to his/her Shares including but not limited to the right to requisition the convening of an Extraordinary General Meeting; (c) to receive, in the Member's name and on his/her behalf, any notice or document which the Member is entitled to receive solely by virtue of being the registered holder of the Shares including the right to receive all benefits and entitlements which attach to the Shares from the date of Completion. For the avoidance of doubt this paragraph (c) does not cover Consideration Stock to be issued to the Member pursuant to his/her agreement with the Parent Company relating to the exchange of the Shares; and (d) execute and do (or procure the execution and giving of) such documents, acts and things as in the opinion of the Attorney is desirable and in such manner as the Attorney thinks fit as if the Attorney were the absolute legal and beneficial owner thereof. 4.3 The power of attorney granted in Clause 4.2 shall expire on the date on which the Parent Company is registered as the holder of the Shares in the register of members of the Company. 4.4 The Member undertakes to ratify everything which the Attorney shall do or purport to do in good faith by virtue of the powers granted by the power of attorney granted in Clause 4.2. 4 4.5 Within seven days of the Parent Company receiving the documents referred to in Clause 4.1 from the Member, it shall issue the Consideration Stock to the Member and shall procure that the Member is registered as a stockholder in the Parent Company in respect of his/her Consideration Stock. (a) If the Member fails or refuses to accept delivery of Consideration Stock then it shall be set aside by the Parent Company. Such setting aside shall be deemed, for all purposes of this Clause 4, to be a payment to the Member and all the Member's rights as a member of the Company shall cease as from the Completion Date and the Parent Company shall be discharged, on such setting aside, from all obligations in respect of the same. The Parent Company shall not be responsible for the safe custody of the Consideration Stock so set aside (which shall be held by the Parent Company for a maximum period of 12 years, after which period the Parent Company shall be entitled to cancel the Consideration Stock in full). (b) A receipt by the Member of stock certificates relating to his/her Consideration Stock due on exchange of his/her Shares shall constitute an absolute discharge to the Parent Company for all its obligations relating thereto. 4.6 The Parent Company undertakes to file with U.S. Securities and Exchange Commission a registration statement with respect to the resale of the Parent Company Stock and have such registration statement declared effective according to the terms set forth in Annex A to this Deed. 5 FURTHER ASSURANCE Each Member shall, at the expense of the Parent Company, do or procure to be done all such further acts and things and execute or procure the execution of all such other documents as the Parent Company may from time to time reasonably require for the purpose of giving to the Parent Company the full benefit of all the provisions of this Deed. 6 INVALIDITY If any provision of this Deed is held to be invalid or unenforceable, then such provision shall (so far as it is invalid or unenforceable) be given no effect and shall be deemed not to be included in this Deed but without invalidating any of the remaining provisions of this Deed. The parties shall then use all reasonable endeavours to replace the invalid or unenforceable provision by a valid provision the effect of which is as close as possible to the intended effect of the invalid or unenforceable provision. 7 NON-ASSIGNMENT No party shall, without the consent of the others, be entitled to assign the benefit or burden of this Deed in whole or in part with the exception of the assignment rights set forth in Annex A to this Deed. 8 NOTICES 8.1 Any notice to be given under this Deed shall be in writing and shall be delivered personally or sent by pre-paid international courier to the addressee at the address set out on the face of this Deed or such other address as may be notified from time to time. A notice so addressed shall be deemed to have been received: (a) if personally delivered, at the time of delivery; and (b) if sent by international courier, two days after the date of delivery of the notice to the international courier by the sender. 8.2 For the avoidance of doubt, notice given under this Deed shall not be validly served if sent by electronic mail. 5 9 THIRD PARTY RIGHTS The parties do not intend that any term of this Deed shall be enforceable pursuant to the Contracts (Rights of Third Parties) Act 1999 by any person who is not a party to this Deed. 10 VARIATION No variation of any of the terms of this Deed (or of any other documents referred to herein) shall be valid unless it is in writing and signed by or on behalf of each of the parties hereto. The expression "variation" shall include any variation, supplement, deletion or replacement however effected. 11 WAIVER 11.1 Any delay by the parties in exercising, or failure to exercise, any right or remedy under this Deed shall not constitute a waiver of the right or remedy or a waiver of any other rights or remedies and no single or partial exercise of any rights or remedy under this Deed or otherwise shall prevent any further exercise of the right or remedy or the exercise of any other right or remedy. 11.2 The rights and remedies of the parties under this Deed are cumulative and not exclusive of any rights or remedies provided by law. 12 ENTIRE AGREEMENT This Deed, together with documents described in or expressed to be entered into in connection with this Deed, constitutes the entire agreement between the parties with respect to all matters referred to herein and supersede all prior written or oral discussions, representations, negotiations and agreements among them regarding such subject matter. Each party confirms that the terms of this Deed are fair and reasonable. 13 COUNTERPARTS This Deed may be executed in as many counterparts (including facsimile counterparts) as may be required. It shall not be necessary that the signatures of, or on behalf of, each party, or that the signatures of all persons required to bind any party, appear on each counterpart; but it shall be sufficient that the signature of, or on behalf of, each party, or that the signatures of the persons required to bind any party, appear on one or more of the counterparts. All counterparts shall collectively constitute a single Deed. It shall not be necessary in making proof of this Deed to produce or account for more than a number of counterparts containing the respective signatures of, or on behalf of, all of the parties hereto. 14 GOVERNING LAW 14.1 This Deed shall be governed by and construed in accordance with the laws of England and Wales. 14.2 In relation to any legal action or proceedings arising out of or in connection with this Deed ("PROCEEDINGS"), each of the parties irrevocably submits to the non-exclusive jurisdiction of the English courts and waives any objection to Proceedings in such courts on the grounds of venue or on the grounds that Proceedings have been brought in an inappropriate forum. 6 IN WITNESS WHEREOF the parties hereto have duly executed this agreement as a deed with the intent that it is delivered as such on the day and year first above written. EXECUTED AS A DEED ) BY ) OSI PHARMACEUTICALS, INC. ) ACTING BY A DULY AUTHORISED ) REPRESENTATIVE AND IN ACCORDANCE ) WITH THE LAWS OF THE JURISDICTION OF ) ITS INCORPORATION AND ARTICLES OF ) ASSOCIATION/BY-LAWS ) )
-------------------------------------- EXECUTED AS A DEED BY 'FIRST -- NAME' 'SURNAME' SIGNED: - -------------------------------------- BY: - -------------------------------------- IN THE PRESENCE OF: Witness's Signature: - ---------------------------------------------------------------------------- Witness's Name: - -------------------------------------------------------------------------------- Witness's Address: - ------------------------------------------------------------------------------ 7 ANNEX "A" TERMS AND CONDITIONS FOR RESALE REGISTRATION 1 DEFINITIONS. In addition to those terms defined in the agreement, for the purposes of this Annex A, the following terms shall have the meanings set forth here: 1.1 "Affiliate" shall mean, with respect to any Person, any other Person which directly or indirectly controls, is controlled by, or is under common control with, such Person. 1.2 "Closing Date" shall mean the date of Completion. 1.3 "Common Stock" shall mean the Parent Company Stock as defined in Recital D of the Deed. 1.4 "Company" shall mean the Parent Company as defined in the preamble of the Deed. 1.5 "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder. 1.6 "Investor" shall mean the Member as defined in the preamble of the Deed. 1.7 "Nasdaq National Market" shall mean The Nasdaq Stock Market, Inc. National Market. 1.8 "Person" shall mean an individual, corporation, partnership, trust, business trust, association, joint stock company, joint venture, pool, syndicate, sole proprietorship, unincorporated organization, governmental authority or any other form of entity not specifically listed herein. 1.9 "Registration Statement" shall mean a registration statement filed pursuant to Section 2.1(a) of this Annex A. 1.10 "SEC" shall mean the United States Securities and Exchange Commission. 1.11 "Shares" shall mean the Consideration Stock as defined in Clause 2.1 of the Deed. 1.12 "Suspension" shall have the meaning set forth in Section 2.2(c) of this Annex A. 1.13 "Suspension Notice" shall have the meaning set forth in Section 2.2(c) of this Annex A. 2 REGISTRATION OF THE SHARES; COMPLIANCE WITH THE SECURITIES ACT. 2.1 Registration Procedures and Expenses. The Company shall: (a) subject to prompt receipt of necessary information from the Investor after prompt request from the Company to the Investor to provide such information, use commercially reasonable efforts to prepare and file with the SEC, as soon as practicable after the Closing Date of the transactions contemplated in the Deed, a shelf registration statement (the "Registration Statement") to enable the resale of the Shares by the Investor from time to time on a delayed or continuous basis pursuant to Rule 415 of the Securities Act through the automated quotation system of the Nasdaq National Market or such other market as may be the principal market on which the Company's Common Stock is sold, or any other manner reasonably requested by the Investor, including privately-negotiated transactions; (b) use commercially reasonable efforts, subject to receipt of necessary information from the Investor after prompt request from the Company to the Investor to provide such information, to cause the Registration Statement to become effective as soon as practicable after the Registration Statement is filed by the Company; (c) use commercially reasonable efforts to prepare and file with the SEC such amendments and supplements to the Registration Statement and the prospectus used in connection therewith as may be 8 necessary to keep the Registration Statement current and effective until the later of (i) two years after the Closing Date or (ii) the date on which all of the Shares may be sold pursuant to Rule 144 of the Securities Act without regard to any volume limitations; (d) furnish to the Investor such number of copies of the Registration Statement, prospectuses and preliminary prospectuses in conformity with the requirements of the Securities Act and such other documents as the Investor may reasonably request, in order to facilitate the public sale or other disposition of all or any of the Shares by the Investor; provided, however, that the obligation of the Company to deliver copies of prospectuses or preliminary prospectuses to the Investor shall be subject to the receipt by the Company of reasonable assurances from the Investor that the Investor will comply with the applicable provisions of the Securities Act and of such other securities or blue sky laws as may be applicable in connection with any use of such prospectuses or preliminary prospectuses; (e) take all reasonable actions necessary to ensure that the Shares are listed and available for quotation on The Nasdaq National Market; (f) file documents required of the Company for normal blue sky clearance in states specified in writing by the Investor; provided, however, that the Company shall not be required to qualify to do business or consent to service of process in any jurisdiction in which it is not now so qualified or has not so consented; (g) bear all expenses in connection with the procedures in paragraph (a) through (f) of this Section 2.1 and the registration of the Shares pursuant to the Registration Statement; and (h) advise the Investor promptly after it shall receive notice or obtain knowledge of the issuance of any stop order by the SEC delaying or suspending the effectiveness of the Registration Statement or of the initiation or threat of any proceeding for that purpose; and it will promptly use commercially reasonable efforts to prevent the issuance of any stop order or to obtain its withdrawal at the earliest possible moment if such stop order should be issued. The Company understands that the Investor disclaims being an underwriter, but any determination by the SEC that the Investor is an underwriter shall not relieve the Company of any obligations it has hereunder. 2.2 Transfer of Shares After Registration; Suspension. (a) The Investor hereby agrees that it will not effect any disposition of the Shares that would constitute a sale within the meaning of the Securities Act except as contemplated in the Registration Statement referred to in Section 2.1 and as described below or as otherwise permitted by law, and that it will promptly notify the Company of any changes in the information set forth in the Registration Statement regarding the Investor or its plan of distribution. (b) Except in the event that paragraph (c) below applies, the Company shall (i) if deemed necessary by the Company, prepare and file from time to time with the SEC a post-effective amendment to the Registration Statement or a supplement to the related prospectus or a supplement or amendment to any document incorporated therein by reference or file any other required document so that such Registration Statement will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and so that, as thereafter delivered to purchasers of the Shares being sold thereunder, such prospectus will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; (ii) provide the Investor copies of any documents filed pursuant to this Section 2.2(b)(i); and (iii) inform the Investor that the Company has complied with its obligations in this Section 2.2(b)(i) (or that, if the Company has filed a post-effective amendment to the Registration Statement which has not yet been declared effective, the Company will notify the Investor to that effect, will use commercially reasonable efforts to secure the 9 effectiveness of such post-effective amendment as promptly as possible and will promptly notify the Investor pursuant to this Section 2.2(b)(i) when the amendment has become effective). (c) Subject to paragraph (d) below, in the event (i) of any request by the SEC or any other federal or state governmental authority during the period of effectiveness of the Registration Statement for amendments or supplements to a Registration Statement or related prospectus or for additional information; (ii) of the issuance by the SEC or any other federal or state governmental authority of any stop order suspending the effectiveness of a Registration Statement or the initiation of any proceedings for that purpose; (iii) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Shares for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; or (iv) of any event or circumstance which, upon the advice of its counsel, necessitates the making of any changes in the Registration Statement or prospectus, or any document incorporated or deemed to be incorporated therein by reference, so that, in the case of the Registration Statement, it will not contain any untrue statement of a material fact or any omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and that in the case of the prospectus, it will not contain any untrue statement of a material fact or any omission to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; then the Company shall promptly deliver a certificate in writing to the Investor (the "Suspension Notice") to the effect of the foregoing and, upon receipt of such Suspension Notice, the Investor will refrain from selling any Shares pursuant to the Registration Statement (a "Suspension") until it receives copies of a supplemented or amended prospectus prepared and filed by the Company, or until it is advised in writing by the Company that the current prospectus may be used, and has received copies of any additional or supplemental filings that are incorporated or deemed incorporated by reference in any such prospectus. In the event of any Suspension, the Company will use its commercially reasonable efforts to cause the use of the prospectus so suspended to be resumed as soon as reasonably practicable. (d) Provided that a Suspension is not then in effect, the Investor may sell the Shares under the Registration Statement; provided, however, that it arranges for delivery of a current prospectus to the transferee of such Shares. Upon receipt of a request therefor, the Company has agreed to provide an adequate number of current prospectuses to the Investor and to supply copies to any other parties requiring such prospectuses. (e) In the event of a sale of the Shares by the Investor pursuant to the Registration Statement, the Investor must also deliver to the Company's transfer agent, with a copy to the Company, a Certificate of Subsequent Sale substantially in the form attached hereto as Exhibit A so that the Shares may be properly transferred. Assuming timely delivery to the Company's transfer agent of one or more stock certificates representing the Shares in proper form for transfer and assuming compliance by the Investor with the terms of this Deed, the Company's transfer agent will issue and make appropriate delivery of one or more stock certificates in the name of the buyer so as to permit timely compliance by the Investor with applicable settlement requirements. 2.3 Indemnification. (a) Definitions. For the purpose of this Section 2.3: (i) the term "Selling Stockholder" shall include the Investor and each person, if any, who controls the Investor within the meaning of Section 15 of the Securities Act, including any officer, director, trustee or Affiliate of the Investor; (ii) the term "Registration Statement" shall include any final prospectus, exhibit, supplement or amendment included in or relating to the Registration Statement referred to in Section 2.1; and (iii) the term "untrue statement" shall include any untrue statement or alleged untrue statement, or any omission or alleged omission to state in the Registration Statement a material 10 fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (b) Indemnification by the Company. To the extent permitted by law, the Company agrees to indemnify and hold harmless the Selling Stockholder from and against any losses, claims, damages or liabilities to which such Selling Stockholder may become subject (under the Securities Act or otherwise) insofar as such losses, claims, damages or liabilities (or actions or proceedings in respect thereof) arise out of, or are based upon, (i) any untrue statement of a material fact contained in the Registration Statement, or (ii) any failure by the Company to fulfill any undertaking included in the Registration Statement, and the Company will reimburse such Selling Stockholder for any reasonable legal or other expenses reasonably incurred in investigating, defending or preparing to defend any such action, proceeding or claim; provided, however, that the Company shall not be liable in any such case to the extent that such loss, claim, damage or liability arises out of, or is based upon, an untrue statement made in such Registration Statement in reliance upon and in conformity with written information furnished to the Company by or on behalf of the Selling Stockholder specifically for use in preparation of the Registration Statement or the failure of the Selling Stockholder to comply with its covenants and agreements contained in the Deed respecting the sale of the Shares or any statement or omission in any prospectus that is corrected in any subsequent prospectus that was delivered to the Investor prior to the pertinent sale or sales by the Investor; provided however, that the Selling Stockholder shall be entitled to be indemnified in any such case for any statement or alleged statement in or omission or alleged omission from such Registration Statement, preliminary prospectus, final prospectus or summary prospectus contained therein, or any amendment or supplement thereto, in which such statement or omission has been corrected, in writing, by the Investor and delivered to the Company at least ten (10) days before the sale or sales from which such loss occurred. The Company shall reimburse the Selling Stockholder for the amounts provided for herein upon receipt of written demand providing evidence of such expenses. (c) Indemnification by the Investor. To the extent permitted by law, the Investor agrees to indemnify and hold harmless the Company (and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act, each officer of the Company who signs the Registration Statement and each director of the Company) and all other selling stockholders listed in the Registration Statement from and against any losses, claims, damages or liabilities to which the Company (or any such officer, director or controlling person) may become subject (under the Securities Act or otherwise), insofar as such losses, claims, damages or liabilities (or actions or proceedings in respect thereof) arise out of, or are based upon, (i) any failure to comply with the covenants and agreements contained in this Deed respecting the sale of the Shares, or (ii) any untrue statement of a material fact contained in the Registration Statement if such untrue statement was made in reliance upon and in conformity with written information furnished by or on behalf of the Investor specifically for use in preparation of the Registration Statement, and the Investor will reimburse the Company (or such officer, director or controlling person), as the case may be, for any reasonable legal or other expenses reasonably incurred in investigating, defending or preparing to defend any such action, proceeding or claim; provided however, that the Selling Stockholder shall have no obligation to indemnify the Company in any such case for any statement or alleged statement in or omission or alleged omission from such Registration Statement, preliminary prospectus, final prospectus or summary prospectus contained therein, or any amendment or supplement thereto, in which such statement or omission has been corrected, in writing, by the Investor and delivered to the Company at least ten (10) days before the sale or sales from which such loss occurred. The Investor shall reimburse the Company and the other selling stockholders listed in the Registration Statement for the amounts provided for herein upon receipt of written demand providing evidence of such expenses. (d) Notice of Claims, Etc. Promptly after receipt by any indemnified person of a notice of a claim or the beginning of any action in respect of which indemnity is to be sought against an indemnifying person pursuant to this Section 2.3, such indemnified person shall notify the 11 indemnifying person in writing of such claim or of the commencement of such action, but the omission to so notify the indemnifying party will not relieve it from any liability which it may have to any indemnified party under this Section 2.3 (except to the extent that such omission materially and adversely affects the indemnifying party's ability to defend such action) or from any liability otherwise than under this Section 2.3. Subject to the provisions hereinafter stated, in case any such action shall be brought against an indemnified person, the indemnifying person shall be entitled to participate therein, and, to the extent that it shall elect by written notice delivered to the indemnified party promptly after receiving the aforesaid notice from such indemnified party, shall be entitled to assume the defense thereof, with counsel reasonably satisfactory to such indemnified person. After notice from the indemnifying person to such indemnified person of its election to assume the defense thereof, such indemnifying person shall not be liable to such indemnified person for any legal expenses subsequently incurred by such indemnified person in connection with the defense thereof; provided, however, that if there exists or shall exist a conflict of interest that would make it inappropriate, in the opinion of counsel to the indemnified person, for the same counsel to represent both the indemnified person and such indemnifying person or any Affiliate or associate thereof, the indemnified person shall be entitled to retain its own counsel at the expense of such indemnifying person; provided, however, that no indemnifying person shall be responsible for the fees and expenses of more than one separate counsel (together with appropriate local counsel) for all indemnified parties. In no event shall any indemnifying person be liable in respect of any amounts paid in settlement of any action unless the indemnifying person shall have approved the terms of such settlement; provided, however, that such consent shall not be unreasonably withheld. No indemnifying person shall, without the prior written consent of the indemnified person, effect any settlement of any pending or threatened proceeding in respect of which any indemnified person is or could have been a party and indemnification could have been sought hereunder by such indemnified person, unless such settlement includes an unconditional release of such indemnified person from all liability on claims that are the subject matter of such proceeding. (e) Contribution. If the indemnification provided for in this Section 2.3 is unavailable to or insufficient to hold harmless an indemnified party under paragraph (b) or (c) above in respect of any losses, claims, damages or liabilities (or actions or proceedings in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative fault of the Company on the one hand and the Investor, as well as any other selling stockholder under the Registration Statement, on the other in connection with the statements or omissions or other matters which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative fault shall be determined by reference to, among other things, in the case of an untrue statement, whether the untrue statement relates to information supplied by the Company on the one hand or an Investor or other selling stockholder on the other and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement. The Company and the Investor agree that it would not be just and equitable if contribution pursuant to this paragraph (e) were determined by pro rata allocation (even if the Investor and other selling stockholders were treated as one entity for such purpose) or by any other method of allocation which does not take into account the equitable considerations referred to above in this paragraph (e). The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this paragraph (e) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. (f) Survival. The obligations of the Company and the Investor under this Section 2.3 shall survive the completion of any offering of Shares in a Registration Statement. 12 3 RULE 144. The Company covenants that it will file the reports required to be filed by it under the Securities Act and the Exchange Act and the rules and regulations adopted by the SEC thereunder (or, if the Company is not required to file such reports, it will, upon the request of the Investor, make publicly available such information as necessary to permit sales pursuant to Rule 144 under the Securities Act), and it will take such further action as the Investor may reasonably request, all to the extent required from time to time to enable the Investor to sell the shares purchased hereunder without registration under the Securities Act within the limitation of the exemptions provided by (a) Rule 144 under the Securities Act, as such rule may be amended from time to time, or (b) any similar rule or regulation hereafter adopted by the SEC. Upon the request of the Investor, the Company will deliver to it a written statement as to whether the Company has complied with such information and requirements. 4 SUCCESSORS AND ASSIGNS. The rights set forth in this Annex A may not be assigned by the Investor. Without the necessity of the prior written consent of the Investor, but after notice duly given and in compliance with Clause 8 of the Deed, the Company may assign its rights and delegate its duties hereunder to any successor-in-interest corporation in the event of a merger or consolidation of the Company with or into another corporation, or any merger or consolidation of another corporation with or into the Company that results directly or indirectly in an aggregate change in the ownership or control of more than 50% of the voting rights of the equity securities of the company, or the sale of all or substantially all of the Company's assets. The terms and conditions of this Annex shall inure to the benefit of and be binding upon the respective permitted successors and assigns of the parties. Nothing in this Annex A, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Annex A, except as expressly provided in this Annex A. 13 EXHIBIT A Certificate of Subsequent Sale Bank of New York 101 Barclay Street New York, NY 10286 RE: Sale of Shares of Common Stock of OSI Pharmaceuticals, Inc. (the "Company") pursuant to the Company's Prospectus dated , (the "Prospectus") Dear Sir/Madam: The undersigned hereby certifies, in connection with the sale of shares of Common Stock of the Company included in the table of Selling Stockholders in the Prospectus, that the undersigned has sold the shares pursuant to the Prospectus and in a manner described under the caption "Plan of Distribution" in the Prospectus and that such sale complies with all applicable securities laws, applicable to the undersigned, including, without limitation, the Prospectus delivery requirements of the Securities Act of 1933, as amended. Selling Stockholder (the beneficial owner): - ------------------------------------------------------------------- Record Holder (e.g., if held in name of nominee): - ----------------------------------------------------------- Restricted Stock Certificate No.(s): - --------------------------------------------------------------------------- Number of Shares Sold: - -------------------------------------------------------------------------------- Date of Sale: - -------------------------------------------------------------------------------- In the event that you receive a stock certificate(s) representing more shares of Common Stock than have been sold by the undersigned, then you should return to the undersigned a newly issued certificate for such excess shares in the name of the Record Holder and BEARING A RESTRICTIVE LEGEND. Further, you should place a stop transfer on your records with regard to such certificate. Very truly yours, By: -------------------------------------------- Dated: - -------------------------------------------- Print Name: ---------------------------------------- Title: --------------------------------------------
cc: Robert L. Van Nostrand Vice President and Chief Financial Officer OSI Pharmaceuticals, Inc. 58 South Service Road, Suite 110 Melville, NY 11747 14 EX-4.2 3 y08089exv4w2.txt EX-4.2: FORM OF DEED OF SHARE EXCHANGE EXHIBIT 4.2 DATED 2005 OSI PHARMACEUTICALS, INC. (1) AND 'FIRST-NAME' 'SURNAME' (2) --------------------------------------------------------------- DEED OF SHARE EXCHANGE RELATING TO THE SHARES OF PROSIDION LIMITED --------------------------------------------------------------- TABLE OF CONTENTS Definitions and Interpretation.............................. 1 1 Exchange of Shares.......................................... 2 2 Representations............................................. 3 2 Completion.................................................. 4 4 Further Assurance........................................... 5 5 Invalidity.................................................. 6 5 Non-Assignment.............................................. 7 5 Notices..................................................... 8 5 Third Party Rights.......................................... 9 5 Variation................................................... 10 6 Waiver...................................................... 11 6 Entire Agreement............................................ 12 6 Counterparts................................................ 13 6 Governing Law............................................... 14 6
DEED OF SHARE EXCHANGE THIS DEED is made the day of 2005 BETWEEN: (1) OSI PHARMACEUTICALS, INC., a company incorporated under the laws of the state of Delaware, USA and having its registered office at 58 South Service Road, Melville, New York, 11747, USA (the "PARENT COMPANY"); and (2) 'First-Name' 'Surname' of 'Address-1', 'Address-2', 'Address-3', 'Address-4' 'Address-5' (the "MEMBER"), each a "PARTY" and collectively the "PARTIES"). RECITALS: (A) WHEREAS Prosidion Limited was incorporated under the laws of England and Wales on 25 November 2002 (registered number 4600121) and has an authorised share capital of 2,000 Pound divided into 14,000,000 Preferred Ordinary Shares of 0.0001 Pound each ("PREFERRED ORDINARY SHARES"); 4,000,000 A Ordinary Shares of 0.0001 Pound each ("A ORDINARY SHARES"); and 2,000,000 B Ordinary Shares of 0.0001 Pound("B ORDINARY SHARES") each. (B) WHEREAS 'Shareholding' B Ordinary Shares (the "SHARES") have been issued to the Member. (C) WHEREAS the Member is the legal and beneficial owner of the Shares. (D) WHEREAS the Parent Company has proposed to acquire all of the Shares from the Member in exchange for common stock, par value $0.01 per share of the Parent Company ("PARENT COMPANY STOCK"). (E) WHEREAS the Member and the Parent Company have agreed to the exchange of the Shares in return for the issue of Parent Company Stock on the terms and conditions set out in this Deed. (F) WHEREAS, the offer and issuance of the Consideration Stock, as defined below, by the Parent Company is made pursuant to Regulation D under the Securities Act of 1933, as amended (the "SECURITIES ACT"). NOW IT IS AGREED AS FOLLOWS: 1 DEFINITIONS AND INTERPRETATION 1.1 In this Deed, subject to any express contrary indication: (a) words importing the singular shall include the plural and vice versa; (b) any reference to this Deed or any other agreement or document shall be construed as a reference to that agreement or document as it may have been, or may from time to time be, amended, varied, novated, replaced or supplemented; (c) any reference to a statute or enactment shall be construed as a reference to such statute as it may have been, or may from time to time be, amended or re-enacted and any subordinate legislation made or thing done, or may from time to time be done, under the statute or enactment provided that, as between the parties, no such amendment or modification shall apply for the purposes of this Deed to the extent that it would impose any new or extended obligation, liability or restriction on, or otherwise adversely affect the rights of, any party; and (d) any reference to any English legal term for any action, remedy, method of judicial proceeding, legal document, legal status, court, official, or any legal concept or thing shall in respect 1 of any jurisdiction (other than England) be deemed to include what most nearly approximates in that jurisdiction to the English legal term. 1.2 All headings in this Deed are for ease of reference only and shall not affect the interpretation of this Deed. 1.3 Capitalised terms used in the Recitals and this Deed shall, unless the context otherwise requires, have the meaning set out in the Articles of Association of the Company. 2 EXCHANGE OF SHARES 2.1 EXCHANGE RATIO For the purposes of this Deed the Parent Company and the Member agree that the Shares shall be exchanged for Parent Company Stock on the basis of the following exchange ratio (the "EXCHANGE RATIO"): For each Share: 0.29685 shares of Parent Company Stock 2.2 NO FRACTIONAL SHARES No certificates representing fractional shares of the Parent Company Stock shall be issued, and such fractional share interests will not entitle the Member to vote or to any other rights of a stockholder of the Parent Company. With respect to any fractional share interest to which the Member is entitled, the Member shall be paid an amount in cash equal to the product obtained by multiplying (i) such fractional share interest to which the Member would otherwise be entitled by (ii) $53.90. 2.3 EXCHANGE OF SHARES At Completion, in consideration for the Parent Company issuing to the Member 'OSIP -- Shares shares of Parent Company Stock (the "CONSIDERATION STOCK"), the Member as legal and beneficial owner shall transfer his Shares to the Parent Company with full title guarantee free from any lien, claim, charge, security interest, mortgage, pledge, easement, conditional sale or other title retention agreement, defect in title, rights of third parties, restrictive covenant or other restrictions of any kind (each an "ENCUMBRANCE"). 3 REPRESENTATIONS AND COVENANTS 3.1 The Member represents and warrants to the Parent Company at the date hereof that: (a) he is the legal and beneficial owner of the Shares; (b) there is no Encumbrance on, over or affecting any of the Shares; (c) no agreement to create an Encumbrance has been entered into and no claim has been made by any person (natural or otherwise) that he is entitled to any such Encumbrance; and (d) he is duly authorized and has full power and authority to enter into and exercise his rights and perform his obligations under this Deed and all other documents to be executed by him at Completion; and (e) his obligations under this Deed are valid and binding subject to applicable law. 3.2 In respect of U.S. securities laws, the Member represents and warrants to the Parent Company at the date hereof that: (a) the Member is an "accredited investor" as defined in Regulation D under the Securities Act and is knowledgeable, sophisticated and experienced in making investments of the type contemplated by this Deed; 2 (b) the Member is acquiring the Consideration Stock for his own account for investment only and with no present intention of distributing any of the Consideration Stock and has no arrangement or understanding with any other persons regarding the distribution of the Consideration Stock; (c) the Member (i) has been granted the opportunity to ask questions of, and receive answers from, representatives of the Parent Company concerning the terms and conditions of the exchange and (ii) has requested, received, reviewed and considered all information that he has deemed relevant in making an informed decision to acquire the Consideration Stock; (d) the Member has been advised of and understands the risks of an investment in the Consideration Stock; (e) the Member acknowledges that the acquisition of the Consideration Stock has not been registered under the Securities Act or registered or qualified under any U.S. state securities law in reliance on specific exemptions therefrom, which exemptions depend upon, among other things, the Members representations and covenants as expressed in this Deed; (f) the Member has been informed and understands that the Consideration Stock may not be sold except (i) pursuant to a registration statement, (ii) pursuant to an exemption from registration, or (iii) in compliance with Rule 144 of the Securities Act (and is therefore subject to the holding requirements of Rule 144 of the Securities Act); (g) the Member has no direct or indirect affiliation or association with any member of the National Association of Securities Dealers, Inc. in the United States (the "NASD"). (h) The Member acknowledges that none of the Consideration Stock was offered or sold to him by means of any form of general solicitation or general advertising, and in connection therewith the Member did not (i) receive or review any advertisement, article, notice or other communication published in a newspaper or magazine or similar media or broadcast over television or radio, whether closed circuit or generally available; or (ii) attend any seminar, meeting or industry investor conference whose attendees were invited by any general solicitation or general advertising. 3.3 In respect of U.S. securities laws, the Member covenants with the Parent Company that: (a) The Member will not, directly or indirectly, offer, sell, pledge, transfer or otherwise dispose of or solicit any offers to buy any of the Consideration Stock except in compliance with the Securities Act and applicable state securities laws. In furtherance thereof, the Member will not make any disposition of the Consideration Stock except (i) pursuant to a registration statement under the Securities Act covering such proposed disposition, (ii) upon prior notice to the Parent Company and, if reasonably requested by the Parent Company, delivery to the Parent Company of an opinion of counsel, reasonably satisfactory to the Parent Company, that such disposition will not require registration under the Securities Act, or (iii) in compliance with Rule 144 under the Securities Act. (b) The Member understands that the Consideration Stock is characterized as "restricted securities" under the Securities Act inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under such law and applicable regulations such securities may be resold without registration under the Securities Act only in certain limited circumstances. The Member understands that certificates evidencing the Consideration Stock may bear one or all of the following legends: "The shares represented by this certificate have not been registered under the Securities Act of 1933, as amended (the "Act"), and may not be transferred without (i) an opinion of counsel satisfactory to the corporation that such transfer may lawfully be made without registration under such Act or qualification under applicable state securities laws; or (ii) such registration or qualification." If required by the authorities of any state in the United States in connection with the issuance of sale of the Consideration Stock, the legend required by such state authority. 3 Any purchaser of the Consideration Stock pursuant to an effective registration statement under the Securities Act will be entitled to receive a certificate bearing no restrictive legend. 4 COMPLETION 4.1 Completion shall take place at the offices of Prosidion Limited, Watlington Road, Oxford, OX4 6LT on April 14, 2005 (the "COMPLETION"). At Completion, the Member shall deliver to the Parent Company: (a) duly executed transfers of its Shares in favour of the Parent Company together with all share certificates relating to the Shares or, in the absence of which, an indemnity relating to loss of such share certificate; and (b) any other documents which may be required to vest in the Parent Company the full legal and beneficial ownership of the Shares and enable the Parent Company to procure them to be registered in its name or as it may direct. 4.2 At Completion the Member IRREVOCABLY AND UNCONDITIONALLY APPOINTS the Parent Company and each of Colin Goddard of 30 Allenby Drive, Fort Solonga, NY 11768, USA, Bob Van Nostrand of 15 Mariners Circle, West Islip, NY 11797, USA and Barbara Wood of 200 West 90th Street, Apartment 12F, New York, NY 10024, USA, each acting severally (each an "ATTORNEY") to be the true and lawful Attorney of the Member, with full power to appoint substitutes, pending registration of the Parent Company as the legal owner of the Shares and in his/her name or otherwise on his/her behalf as the Attorney sees fit to execute notices, instruments of proxy or other documents which may fall to be executed or signed by the Member and exercise and perform any of the acts and things to be done and performed by the Member in connection with the legal and beneficial ownership of all or any of the Shares held by the Member as if the Attorney were the legal and beneficial owner of such Shares and in particular but without limitation the Attorney is appointed to: (a) attend any General Meeting (Annual and/or Extraordinary) of the Company and to represent the Member and vote on the Member's behalf and in his name; (b) exercise in the Member's name and on his/her behalf, all rights and privileges attached to his Shares including but not limited to the right to requisition the convening of an Extraordinary General Meeting; (c) to receive, in the Member's name and on his behalf, any notice or document which the Member is entitled to receive solely by virtue of being the registered holder of the Shares including the right to receive all benefits and entitlements which attach to the Shares from the date of Completion. For the avoidance of doubt this paragraph (c) does not cover Consideration Stock to be issued to the Member pursuant to his agreement with the Parent Company relating to the exchange of the Shares; and (d) execute and do (or procure the execution and giving of) such documents, acts and things as in the opinion of the Attorney is desirable and in such manner as the Attorney thinks fit as if the Attorney were the absolute legal and beneficial owner thereof. 4.3 The power of attorney granted in Clause 4.2 shall expire on the date on which the Parent Company is registered as the holder of the Shares in the register of members of the Company. 4.4 The Member undertakes to ratify everything which the Attorney shall do or purport to do in good faith by virtue of the powers granted by the power of attorney granted in Clause 4.2. 4.5 Within seven days of the Parent Company receiving the documents referred to in Clause 4.1 from the Member, it shall issue the Consideration Stock to the Member and shall procure that the Member is registered as a stockholder in the Parent Company in respect of his/its Consideration Stock. (a) If the Member fails or refuses to accept delivery of Consideration Stock then it shall be set aside by the Parent Company. Such setting aside shall be deemed, for all purposes of this Clause 4, 4 to be a payment to the Member and all the Member's rights as a member of the Company shall cease as from the Completion Date and the Parent Company shall be discharged, on such setting aside, from all obligations in respect of the same. The Parent Company shall not be responsible for the safe custody of the Consideration Stock so set aside (which shall be held by the Parent Company for a maximum period of 12 years, after which period the Parent Company shall be entitled to cancel the Consideration Stock in full). (b) A receipt by the Member of stock certificates relating to his Consideration Stock due on exchange of his Shares shall constitute an absolute discharge to the Parent Company for all its obligations relating thereto. 4.6 The Parent Company undertakes to file with U.S. Securities and Exchange Commission a registration statement with respect to the resale of the Parent Company Stock and have such registration statement declared effective according to the terms set forth in Annex A to this Deed. 5 FURTHER ASSURANCE Each Member shall, at the expense of the Parent Company, do or procure to be done all such further acts and things and execute or procure the execution of all such other documents as the Parent Company may from time to time reasonably require for the purpose of giving to the Parent Company the full benefit of all the provisions of this Deed. 6 INVALIDITY If any provision of this Deed is held to be invalid or unenforceable, then such provision shall (so far as it is invalid or unenforceable) be given no effect and shall be deemed not to be included in this Deed but without invalidating any of the remaining provisions of this Deed. The parties shall then use all reasonable endeavours to replace the invalid or unenforceable provision by a valid provision the effect of which is as close as possible to the intended effect of the invalid or unenforceable provision. 7 NON-ASSIGNMENT No party shall, without the consent of the others, be entitled to assign the benefit or burden of this Deed in whole or in part with the exception of the assignment rights set forth in Annex A to this Deed. 8 NOTICES 8.1 Any notice to be given under this Deed shall be in writing and shall be delivered personally or sent by pre-paid international courier to the addressee at the address set out on the face of this Deed or such other address as may be notified from time to time. A notice so addressed shall be deemed to have been received: (a) if personally delivered, at the time of delivery; and (b) if sent by international courier, two days after the date of delivery of the notice to the international courier by the sender. 8.2 For the avoidance of doubt, notice given under this Deed shall not be validly served if sent by electronic mail. 9 THIRD PARTY RIGHTS The parties do not intend that any term of this Deed shall be enforceable pursuant to the Contracts (Rights of Third Parties) Act 1999 by any person who is not a party to this Deed. 5 10 VARIATION No variation of any of the terms of this Deed (or of any other documents referred to herein) shall be valid unless it is in writing and signed by or on behalf of each of the parties hereto. The expression "variation" shall include any variation, supplement, deletion or replacement however effected. 11 WAIVER 11.1 Any delay by the parties in exercising, or failure to exercise, any right or remedy under this Deed shall not constitute a waiver of the right or remedy or a waiver of any other rights or remedies and no single or partial exercise of any rights or remedy under this Deed or otherwise shall prevent any further exercise of the right or remedy or the exercise of any other right or remedy. 11.2 The rights and remedies of the parties under this Deed are cumulative and not exclusive of any rights or remedies provided by law. 12 ENTIRE AGREEMENT This Deed, together with documents described in or expressed to be entered into in connection with this Deed, constitutes the entire agreement between the parties with respect to all matters referred to herein and supersede all prior written or oral discussions, representations, negotiations and agreements among them regarding such subject matter. Each party confirms that the terms of this Deed are fair and reasonable. 13 COUNTERPARTS This Deed may be executed in as many counterparts (including facsimile counterparts) as may be required. It shall not be necessary that the signatures of, or on behalf of, each party, or that the signatures of all persons required to bind any party, appear on each counterpart; but it shall be sufficient that the signature of, or on behalf of, each party, or that the signatures of the persons required to bind any party, appear on one or more of the counterparts. All counterparts shall collectively constitute a single Deed. It shall not be necessary in making proof of this Deed to produce or account for more than a number of counterparts containing the respective signatures of, or on behalf of, all of the parties hereto. 14 GOVERNING LAW 14.1 This Deed shall be governed by and construed in accordance with the laws of England and Wales. 14.2 In relation to any legal action or proceedings arising out of or in connection with this Deed ("PROCEEDINGS"), each of the parties irrevocably submits to the non-exclusive jurisdiction of the English courts and waives any objection to Proceedings in such courts on the grounds of venue or on the grounds that Proceedings have been brought in an inappropriate forum. 6 IN WITNESS WHEREOF the parties hereto have duly executed this agreement as a deed with the intent that it is delivered as such on the day and year first above written. EXECUTED AS A DEED ) BY ) OSI PHARMACEUTICALS, INC. ) ACTING BY A DULY AUTHORISED ) REPRESENTATIVE AND IN ACCORDANCE ) WITH THE LAWS OF THE JURISDICTION OF ) ITS INCORPORATION AND ARTICLES OF ) ASSOCIATION/BY-LAWS ) )
-------------------------------------- EXECUTED AS A DEED ) BY ) 'FIRST-NAME' 'SURNAME' ) ACTING BY A DULY AUTHORISED ) REPRESENTATIVE AND IN ACCORDANCE ) WITH THE LAWS OF THE JURISDICTION OF ) ITS INCORPORATION AND ARTICLES OF ) ASSOCIATION/BY-LAWS ) )
-------------------------------------- 7 ANNEX "A" TERMS AND CONDITIONS FOR RESALE REGISTRATION 1 DEFINITIONS. In addition to those terms defined in the agreement, for the purposes of this Annex A, the following terms shall have the meanings set forth here: 1.1 "Affiliate" shall mean, with respect to any Person, any other Person which directly or indirectly controls, is controlled by, or is under common control with, such Person. 1.2 "Closing Date" shall mean the date of Completion. 1.3 "Common Stock" shall mean the Parent Company Stock as defined in Recital D of the Deed. 1.4 "Company" shall mean the Parent Company as defined in the preamble of the Deed. 1.5 "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder. 1.6 "Investor" shall mean the Member as defined in the preamble of the Deed. 1.7 "Nasdaq National Market" shall mean The Nasdaq Stock Market, Inc. National Market. 1.8 "Person" shall mean an individual, corporation, partnership, trust, business trust, association, joint stock company, joint venture, pool, syndicate, sole proprietorship, unincorporated organization, governmental authority or any other form of entity not specifically listed herein. 1.9 "Registration Statement" shall mean a registration statement filed pursuant to Section 2.1(a) of this Annex A. 1.10 "SEC" shall mean the United States Securities and Exchange Commission. 1.11 "Shares" shall mean the Consideration Stock as defined in Clause 2.1 of the Deed. 1.12 "Suspension" shall have the meaning set forth in Section 2.2(c) of this Annex A. 1.13 "Suspension Notice" shall have the meaning set forth in Section 2.2(c) of this Annex A. 2 REGISTRATION OF THE SHARES; COMPLIANCE WITH THE SECURITIES ACT. 2.1 Registration Procedures and Expenses. The Company shall: (a) subject to prompt receipt of necessary information from the Investor after prompt request from the Company to the Investor to provide such information, use commercially reasonable efforts to prepare and file with the SEC, as soon as practicable after the Closing Date of the transactions contemplated in the Deed, a shelf registration statement (the "Registration Statement") to enable the resale of the Shares by the Investor from time to time on a delayed or continuous basis pursuant to Rule 415 of the Securities Act through the automated quotation system of the Nasdaq National Market or such other market as may be the principal market on which the Company's Common Stock is sold, or any other manner reasonably requested by the Investor, including privately-negotiated transactions; (b) use commercially reasonable efforts, subject to receipt of necessary information from the Investor after prompt request from the Company to the Investor to provide such information, to cause the Registration Statement to become effective as soon as practicable after the Registration Statement is filed by the Company; (c) use commercially reasonable efforts to prepare and file with the SEC such amendments and supplements to the Registration Statement and the prospectus used in connection therewith as may be necessary to keep the Registration Statement current and effective until the later of (i) two years 8 after the Closing Date or (ii) the date on which all of the Shares may be sold pursuant to Rule 144 of the Securities Act without regard to any volume limitations; (d) furnish to the Investor such number of copies of the Registration Statement, prospectuses and preliminary prospectuses in conformity with the requirements of the Securities Act and such other documents as the Investor may reasonably request, in order to facilitate the public sale or other disposition of all or any of the Shares by the Investor; provided, however, that the obligation of the Company to deliver copies of prospectuses or preliminary prospectuses to the Investor shall be subject to the receipt by the Company of reasonable assurances from the Investor that the Investor will comply with the applicable provisions of the Securities Act and of such other securities or blue sky laws as may be applicable in connection with any use of such prospectuses or preliminary prospectuses; (e) take all reasonable actions necessary to ensure that the Shares are listed and available for quotation on The Nasdaq National Market; (f) file documents required of the Company for normal blue sky clearance in states specified in writing by the Investor; provided, however, that the Company shall not be required to qualify to do business or consent to service of process in any jurisdiction in which it is not now so qualified or has not so consented; (g) bear all expenses in connection with the procedures in paragraph (a) through (f) of this Section 2.1 and the registration of the Shares pursuant to the Registration Statement; and (h) advise the Investor promptly after it shall receive notice or obtain knowledge of the issuance of any stop order by the SEC delaying or suspending the effectiveness of the Registration Statement or of the initiation or threat of any proceeding for that purpose; and it will promptly use commercially reasonable efforts to prevent the issuance of any stop order or to obtain its withdrawal at the earliest possible moment if such stop order should be issued. The Company understands that the Investor disclaims being an underwriter, but any determination by the SEC that the Investor is an underwriter shall not relieve the Company of any obligations it has hereunder. 2.2 Transfer of Shares After Registration; Suspension. (a) The Investor hereby agrees that it will not effect any disposition of the Shares that would constitute a sale within the meaning of the Securities Act except as contemplated in the Registration Statement referred to in Section 2.1 and as described below or as otherwise permitted by law, and that it will promptly notify the Company of any changes in the information set forth in the Registration Statement regarding the Investor or its plan of distribution. (b) Except in the event that paragraph (c) below applies, the Company shall (i) if deemed necessary by the Company, prepare and file from time to time with the SEC a post-effective amendment to the Registration Statement or a supplement to the related prospectus or a supplement or amendment to any document incorporated therein by reference or file any other required document so that such Registration Statement will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and so that, as thereafter delivered to purchasers of the Shares being sold thereunder, such prospectus will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; (ii) provide the Investor copies of any documents filed pursuant to this Section 2.2(b)(i); and (iii) inform the Investor that the Company has complied with its obligations in this Section 2.2(b)(i) (or that, if the Company has filed a post-effective amendment to the Registration Statement which has not yet been declared effective, the Company will notify the Investor to that effect, will use commercially reasonable efforts to secure the 9 effectiveness of such post-effective amendment as promptly as possible and will promptly notify the Investor pursuant to this Section 2.2(b)(i) when the amendment has become effective). (c) Subject to paragraph (d) below, in the event (i) of any request by the SEC or any other federal or state governmental authority during the period of effectiveness of the Registration Statement for amendments or supplements to a Registration Statement or related prospectus or for additional information; (ii) of the issuance by the SEC or any other federal or state governmental authority of any stop order suspending the effectiveness of a Registration Statement or the initiation of any proceedings for that purpose; (iii) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Shares for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; or (iv) of any event or circumstance which, upon the advice of its counsel, necessitates the making of any changes in the Registration Statement or prospectus, or any document incorporated or deemed to be incorporated therein by reference, so that, in the case of the Registration Statement, it will not contain any untrue statement of a material fact or any omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and that in the case of the prospectus, it will not contain any untrue statement of a material fact or any omission to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; then the Company shall promptly deliver a certificate in writing to the Investor (the "Suspension Notice") to the effect of the foregoing and, upon receipt of such Suspension Notice, the Investor will refrain from selling any Shares pursuant to the Registration Statement (a "Suspension") until it receives copies of a supplemented or amended prospectus prepared and filed by the Company, or until it is advised in writing by the Company that the current prospectus may be used, and has received copies of any additional or supplemental filings that are incorporated or deemed incorporated by reference in any such prospectus. In the event of any Suspension, the Company will use its commercially reasonable efforts to cause the use of the prospectus so suspended to be resumed as soon as reasonably practicable. (d) Provided that a Suspension is not then in effect, the Investor may sell the Shares under the Registration Statement; provided, however, that it arranges for delivery of a current prospectus to the transferee of such Shares. Upon receipt of a request therefor, the Company has agreed to provide an adequate number of current prospectuses to the Investor and to supply copies to any other parties requiring such prospectuses. (e) In the event of a sale of the Shares by the Investor pursuant to the Registration Statement, the Investor must also deliver to the Company's transfer agent, with a copy to the Company, a Certificate of Subsequent Sale substantially in the form attached hereto as Exhibit A so that the Shares may be properly transferred. Assuming timely delivery to the Company's transfer agent of one or more stock certificates representing the Shares in proper form for transfer and assuming compliance by the Investor with the terms of this Deed, the Company's transfer agent will issue and make appropriate delivery of one or more stock certificates in the name of the buyer so as to permit timely compliance by the Investor with applicable settlement requirements. 2.3 Indemnification. (a) Definitions. For the purpose of this Section 2.3: (i) the term "Selling Stockholder" shall include the Investor and each person, if any, who controls the Investor within the meaning of Section 15 of the Securities Act, including any officer, director, trustee or Affiliate of the Investor; (ii) the term "Registration Statement" shall include any final prospectus, exhibit, supplement or amendment included in or relating to the Registration Statement referred to in Section 2.1; and (iii) the term "untrue statement" shall include any untrue statement or alleged untrue statement, or any omission or alleged omission to state in the Registration Statement a material 10 fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (b) Indemnification by the Company. To the extent permitted by law, the Company agrees to indemnify and hold harmless the Selling Stockholder from and against any losses, claims, damages or liabilities to which such Selling Stockholder may become subject (under the Securities Act or otherwise) insofar as such losses, claims, damages or liabilities (or actions or proceedings in respect thereof) arise out of, or are based upon, (i) any untrue statement of a material fact contained in the Registration Statement, or (ii) any failure by the Company to fulfill any undertaking included in the Registration Statement, and the Company will reimburse such Selling Stockholder for any reasonable legal or other expenses reasonably incurred in investigating, defending or preparing to defend any such action, proceeding or claim; provided, however, that the Company shall not be liable in any such case to the extent that such loss, claim, damage or liability arises out of, or is based upon, an untrue statement made in such Registration Statement in reliance upon and in conformity with written information furnished to the Company by or on behalf of the Selling Stockholder specifically for use in preparation of the Registration Statement or the failure of the Selling Stockholder to comply with its covenants and agreements contained in the Deed respecting the sale of the Shares or any statement or omission in any prospectus that is corrected in any subsequent prospectus that was delivered to the Investor prior to the pertinent sale or sales by the Investor; provided however,that the Selling Stockholder shall be entitled to be indemnified in any such case for any statement or alleged statement in or omission or alleged omission from such Registration Statement, preliminary prospectus, final prospectus or summary prospectus contained therein, or any amendment or supplement thereto, in which such statement or omission has been corrected, in writing, by the Investor and delivered to the Company at least ten (10) days before the sale or sales from which such loss occurred. The Company shall reimburse the Selling Stockholder for the amounts provided for herein upon receipt of written demand providing evidence of such expenses. (c) Indemnification by the Investor. To the extent permitted by law, the Investor agrees to indemnify and hold harmless the Company (and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act, each officer of the Company who signs the Registration Statement and each director of the Company) and all other selling stockholders listed in the Registration Statement from and against any losses, claims, damages or liabilities to which the Company (or any such officer, director or controlling person) may become subject (under the Securities Act or otherwise), insofar as such losses, claims, damages or liabilities (or actions or proceedings in respect thereof) arise out of, or are based upon, (i) any failure to comply with the covenants and agreements contained in this Deed respecting the sale of the Shares, or (ii) any untrue statement of a material fact contained in the Registration Statement if such untrue statement was made in reliance upon and in conformity with written information furnished by or on behalf of the Investor specifically for use in preparation of the Registration Statement, and the Investor will reimburse the Company (or such officer, director or controlling person), as the case may be, for any reasonable legal or other expenses reasonably incurred in investigating, defending or preparing to defend any such action, proceeding or claim; provided however, that the Selling Stockholder shall have no obligation to indemnify the Company in any such case for any statement or alleged statement in or omission or alleged omission from such Registration Statement, preliminary prospectus, final prospectus or summary prospectus contained therein, or any amendment or supplement thereto, in which such statement or omission has been corrected, in writing, by the Investor and delivered to the Company at least ten (10) days before the sale or sales from which such loss occurred. The Investor shall reimburse the Company and the other selling stockholders listed in the Registration Statement for the amounts provided for herein upon receipt of written demand providing evidence of such expenses. (d) Notice of Claims, Etc. Promptly after receipt by any indemnified person of a notice of a claim or the beginning of any action in respect of which indemnity is to be sought against an indemnifying person pursuant to this Section 2.3, such indemnified person shall notify the 11 indemnifying person in writing of such claim or of the commencement of such action, but the omission to so notify the indemnifying party will not relieve it from any liability which it may have to any indemnified party under this Section 2.3 (except to the extent that such omission materially and adversely affects the indemnifying party's ability to defend such action) or from any liability otherwise than under this Section 2.3. Subject to the provisions hereinafter stated, in case any such action shall be brought against an indemnified person, the indemnifying person shall be entitled to participate therein, and, to the extent that it shall elect by written notice delivered to the indemnified party promptly after receiving the aforesaid notice from such indemnified party, shall be entitled to assume the defense thereof, with counsel reasonably satisfactory to such indemnified person. After notice from the indemnifying person to such indemnified person of its election to assume the defense thereof, such indemnifying person shall not be liable to such indemnified person for any legal expenses subsequently incurred by such indemnified person in connection with the defense thereof; provided, however, that if there exists or shall exist a conflict of interest that would make it inappropriate, in the opinion of counsel to the indemnified person, for the same counsel to represent both the indemnified person and such indemnifying person or any Affiliate or associate thereof, the indemnified person shall be entitled to retain its own counsel at the expense of such indemnifying person; provided, however, that no indemnifying person shall be responsible for the fees and expenses of more than one separate counsel (together with appropriate local counsel) for all indemnified parties. In no event shall any indemnifying person be liable in respect of any amounts paid in settlement of any action unless the indemnifying person shall have approved the terms of such settlement; provided, however, that such consent shall not be unreasonably withheld. No indemnifying person shall, without the prior written consent of the indemnified person, effect any settlement of any pending or threatened proceeding in respect of which any indemnified person is or could have been a party and indemnification could have been sought hereunder by such indemnified person, unless such settlement includes an unconditional release of such indemnified person from all liability on claims that are the subject matter of such proceeding. (e) Contribution. If the indemnification provided for in this Section 2.3 is unavailable to or insufficient to hold harmless an indemnified party under paragraph (b) or (c) above in respect of any losses, claims, damages or liabilities (or actions or proceedings in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative fault of the Company on the one hand and the Investor, as well as any other selling stockholder under the Registration Statement, on the other in connection with the statements or omissions or other matters which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative fault shall be determined by reference to, among other things, in the case of an untrue statement, whether the untrue statement relates to information supplied by the Company on the one hand or an Investor or other selling stockholder on the other and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement. The Company and the Investor agree that it would not be just and equitable if contribution pursuant to this paragraph (e) were determined by pro rata allocation (even if the Investor and other selling stockholders were treated as one entity for such purpose) or by any other method of allocation which does not take into account the equitable considerations referred to above in this paragraph (e). The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this paragraph (e) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. (f) Survival. The obligations of the Company and the Investor under this Section 2.3 shall survive the completion of any offering of Shares in a Registration Statement. 12 3 RULE 144. The Company covenants that it will file the reports required to be filed by it under the Securities Act and the Exchange Act and the rules and regulations adopted by the SEC thereunder (or, if the Company is not required to file such reports, it will, upon the request of the Investor, make publicly available such information as necessary to permit sales pursuant to Rule 144 under the Securities Act), and it will take such further action as the Investor may reasonably request, all to the extent required from time to time to enable the Investor to sell the shares purchased hereunder without registration under the Securities Act within the limitation of the exemptions provided by (a) Rule 144 under the Securities Act, as such rule may be amended from time to time, or (b) any similar rule or regulation hereafter adopted by the SEC. Upon the request of the Investor, the Company will deliver to it a written statement as to whether the Company has complied with such information and requirements. 4 SUCCESSORS AND ASSIGNS. The rights set forth in this Annex A may not be assigned by the Investor. Without the necessity of the prior written consent of the Investor, but after notice duly given and in compliance with Clause 8 of the Deed, the Company may assign its rights and delegate its duties hereunder to any successor-in-interest corporation in the event of a merger or consolidation of the Company with or into another corporation, or any merger or consolidation of another corporation with or into the Company that results directly or indirectly in an aggregate change in the ownership or control of more than 50% of the voting rights of the equity securities of the company, or the sale of all or substantially all of the Company's assets. The terms and conditions of this Annex shall inure to the benefit of and be binding upon the respective permitted successors and assigns of the parties. Nothing in this Annex A, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Annex A, except as expressly provided in this Annex A. 13 EXHIBIT A CERTIFICATE OF SUBSEQUENT SALE Bank of New York 101 Barclay Street New York, NY 10286 RE: Sale of Shares of Common Stock of OSI Pharmaceuticals, Inc. (the "Company") pursuant to the Company's Prospectus dated , (the "Prospectus") Dear Sir/Madam: The undersigned hereby certifies, in connection with the sale of shares of Common Stock of the Company included in the table of Selling Stockholders in the Prospectus, that the undersigned has sold the shares pursuant to the Prospectus and in a manner described under the caption "Plan of Distribution" in the Prospectus and that such sale complies with all applicable securities laws, applicable to the undersigned, including, without limitation, the Prospectus delivery requirements of the Securities Act of 1933, as amended. Selling Stockholder (the beneficial owner): - ------------------------------------------------------------------- Record Holder (e.g., if held in name of nominee): - ----------------------------------------------------------- Restricted Stock Certificate No.(s): - --------------------------------------------------------------------------- Number of Shares Sold: - -------------------------------------------------------------------------------- Date of Sale: - -------------------------------------------------------------------------------- In the event that you receive a stock certificate(s) representing more shares of Common Stock than have been sold by the undersigned, then you should return to the undersigned a newly issued certificate for such excess shares in the name of the Record Holder and BEARING A RESTRICTIVE LEGEND. Further, you should place a stop transfer on your records with regard to such certificate. Very truly yours, Dated: - --------------------------------------------.. By: -------------------------------------------- Print Name: ---------------------------------------- Title: --------------------------------------------
cc: Robert L. Van Nostrand Vice President and Chief Financial Officer OSI Pharmaceuticals, Inc. 58 South Service Road, Suite 110 Melville, NY 11747 14 EX-5.1 4 y08089exv5w1.txt EX-5.1: OPINION OF SAUL EWING LLP . . . EXHIBIT 5.1 lawyers@saul.com SAUL EWING www.saul.com
April 22, 2005 OSI Pharmaceuticals, Inc. 58 South Service Road Suite 110 Melville, NY 11747 Ladies and Gentlemen: We refer to the Registration Statement on Form S-3 (collectively with any amendments thereto, the "Registration Statement") of OSI Pharmaceuticals, Inc., a Delaware corporation (the "Company"), filed with the Securities and Exchange Commission covering the registration under the Securities Act of 1933, as amended (the "Securities Act"), of 84,940 shares of common stock, par value $.01 per share, of the Company (the "Shares"), as described in the Prospectus included in the Registration Statement. We have examined the Registration Statement, the Certificate of Incorporation, as amended, and the Amended and Restated By-laws of the Company and such records, certificates and other documents as we have considered necessary or appropriate for the purposes of this opinion. Without limiting the generality of the foregoing, in our examination we have assumed without independent verification that (i) each natural person executing a document we examined is legally competent to do so, (ii) all documents submitted to us as originals are "authentic," the signatures on all documents that we examined are genuine, and all documents submitted to us as certified, conformed, photostatic or facsimile copies conformed to the original document, and (iii) all corporate records made available to us by the Company and or public records reviewed are accurate and complete. Based on the foregoing, it is our opinion that the Shares were, when issued, duly authorized, validly issued, fully paid and non-assessable. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to this firm under the caption "Legal Matters" in the Prospectus contained therein. In giving this consent, we do not admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Securities and Exchange Commission thereunder. Very truly yours, /s/ SAUL EWING LLP - -------------------------------------------------------------------------------- BALTIMORE CHESTERBROOK HARRISBURG NEWARK PHILADELPHIA PRINCETON WASHINGTON WILMINGTON A DELAWARE LIMITED LIABILITY PARTNERSHIP EX-23.1 5 y08089exv23w1.txt EX-23.1: CONSENT OF KPMG LLP EXHIBIT 23.1 CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM The Board of Directors OSI Pharmaceuticals, Inc.: We consent to the incorporation by reference of our report dated November 29, 2004, with respect to the consolidated balance sheets of OSI Pharmaceuticals, Inc. and subsidiaries as of September 30, 2004 and 2003, and the related consolidated statements of operations, stockholders' equity, and cash flows for each of the years in the three-year period ended September 30, 2004, and to the reference to our firm under the heading "Experts" in this Registration Statement on Form S-3 and related prospectus. As discussed in Note 1 (b) to the consolidated financial statements, the Company adopted EITF 00-21 "Revenue Arrangements with Multiple Deliverables" in 2004. As discussed in notes 1(j) and 8 to the consolidated financial statements, the Company fully adopted the provisions of Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets" in 2003. As discussed in notes 10 to the consolidated financial statements, the Company early adopted Statement of Financial Accounting Standards No. 145 "Rescission of FASB Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical Corrections" relating to the classification of the effect of early debt extinguishments in 2002. /s/ KPMG LLP Melville, New York April 21, 2005 -----END PRIVACY-ENHANCED MESSAGE-----