NEITHER THIS DEBENTURE, NOR THE SHARES ISSUABLE UPON CONVERSION OF THIS
DEBENTURE HAVE BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE 'ACT'). THIS DEBENTURE SHALL NOT CONSTITUTE AN OFFER TO
SELL NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY JURISDICTION IN
WHICH SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE SECURITIES ARE
'RESTRICTED' AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS PERMITTED UNDER THE
ACT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR AN EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF SUCH ACT
NEITHER THIS DEBENTURE, NOR THE SHARES ISSUABLE UPON CONVERSION OF THIS
DEBENTURE MAY BE OFFERED OR SOLD IN THE UNITED STATES OR TO U.S. PERSONS (AS
SUCH TERM IS DEFINED IN REGULATION S PROMULGATED UNDER THE ACT) UNLESS THE
SECURITIES ARE REGISTERED UNDER THE ACT OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE ACT.
THIS DEBENTURE DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF
AN OFFER TO BUY, ANY OF THE SECURITIES OFFERED HEREBY BY ANY PERSON IN ANY
JURISDICTION IN WHICH IT IS UNLAWFUL FOR SUCH PERSON TO MAKE SUCH AN OFFERING OR
SOLICITATION. IN MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN
EXAMINATION OF THE COMPANY AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS
AND THE RISKS INVOLVED. THESE SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY
FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE
FOREGOING AUTHORITIES HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED THE ADEQUACY
OF THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
No. $ U.S.
---------- -------
CELGENE CORPORATION
8% CONVERTIBLE DEBENTURE DUE JULY 31, 1997
THIS DEBENTURE is one of a duly authorized issue of Debentures of CELGENE
CORPORATION, a corporation duly organized and existing under the laws of the
State of Delaware (the 'Company'), designated as its 8% Convertible Debentures
Due July 31, 1997, in an aggregate principal amount not exceeding U.S.
$12,000,000
FOR VALUE RECEIVED, the Company promises to pay to __________, the
registered holder hereof (the 'Holder'), the principal sum of
___________________ ($_________ U.S.), on or prior to July 31, 1997 (the
'Maturity Date') and to pay (continued on reverse)
IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed
by an officer thereunto duly authorized.
CELGENE CORPORATION
Dated: July 1995 By:___________________________________
Dr. Sol J. Barer,
President and Chief
Operating Officer
(page 2 of 4 of Celgene Corporation Convertible Debenture due July 31, 1997)
interest on the principal sum outstanding from time to time in arrears on the
Maturity Date, at the rate of 8% per annum accruing from the date of initial
issuance. Accrual of interest shall commence on the first business day to occur
after the date hereof until payment in full of the principal sum has been made
or duly provided for. The interest so payable will be paid on the Maturity Date
to the person in whose name this Debenture (or one or more predecessor
Debentures) is registered on the records of the Company regarding registration
and transfers of the Debentures (the 'Debenture Register') on the first business
day prior to the Maturity Date: provided, however, that the Company's obligation
to a transferee of this Debenture arises only if such transfer, sale or other
disposition is made in accordance with the terms and conditions of the
Regulation S Subscription Agreement executed by the original Holder or a
subsequent transferee. All accrued and unpaid interest shall bear interest at
the same rate of 8% per annum from the Maturity Date until the date of payment.
The principal of, and interest on, this Debenture are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts, at the address of the Holder
last appearing on the Debenture Register of the Company as designated in writing
by the Holder from time to time. The Debenture Register shall represent the
record of ownership and right to receive principal and interest on this
Debenture. Interest and principal shall be payable only to the registered Holder
as reflected in the Debenture Register. A transfer of the right to receive
principal and interest under this Debenture shall be transferable only through
an appropriate entry in the Debenture Register as provided herein. The
forwarding of such payment shall constitute a payment of interest hereunder and
shall satisfy and discharge the liability for principal and interest on this
Debenture to the extent of the sum represented by such payment.
This Debenture is subject to the following additional provisions:
1. The Debentures are issuable in denominations of One Hundred Thousand
Dollars ($100,000 U.S.) and integral multiples of Fifty Thousand Dollars
($50,000 U.S.) in excess thereof. The Debentures are exchangeable for an equal
aggregate principal amount of Debentures of different authorized denominations,
as requested by the Holders surrendering the same but shall not be issuable in
denominations less than integral multiples of Fifty Thousand Dollars ($50,000
U.S.). No service charge will be made for such registration of transfer or
exchange.
2. The Company shall be entitled to withhold from all payments of principal
of, and interest on, this Debenture any amounts required to be withheld under
the applicable provisions of the United States income tax laws or other
applicable laws at the time of such payments. The Holder shall pay any other
taxes, charges, or levies in connection with the issuance or transfer thereof.
3. This Debenture has been issued subject to investment representations of
the original purchaser hereof and may be transferred or exchanged only in
compliance with the Securities Act of 1933, as amended (the 'Act'), including
Regulation S promulgated under the Act. Any Holder of this Debenture, by
acceptance hereof, agrees to the representations, warranties and covenants
herein. Prior to due presentment to the Company for transfer of this Debenture,
the Company and any agent of the Company may treat the person in whose name this
Debenture is duly registered on the Company's Debenture Register as the owner
hereof for the purpose of receiving payment as herein provided and for all other
purposes, whether or not this Debenture be overdue, and neither the Company nor
any such agent shall be affected by notice to the contrary.
4. The Holder of this Debenture is entitled, at its option, at any time
commencing on July 29, 1995 until September 11, 1995 to convert the principal
amount of this Debenture, in whole but not in part, into shares of Common Stock,
par value $.01 per share (the 'Common Stock') of the Company at a conversion
price (the 'Fixed Conversion Price') for each share of Common Stock equal to
100% of the Closing Bid Price, as defined, on July 28, 1995 and is entitled, at
its option at any time commencing on September 12, 1995 until July 30, 1997
(which is the last business day prior to the Maturity Date hereof) to convert
the principal amount of this Debenture, in whole but not in part, into shares of
Common Stock of the Company at a conversion price ('Variable Conversion Price')
for each share of Common Stock equal to the lesser of (a) Eight-five percent
(85%) of the Market Price (as defined) of the Company's Common Stock, or (b)
100% of the Closing Bid Price, as defined, on July 28, 1995. For purposes of
this Section 4, the 'Closing Bid Price' of the Common Stock for each day shall
be the closing bid price of the Common Stock on such day as reported on the New
York Stock Exchange composite tape, or, if the Common Stock is not listed or
admitted for trading on such Exchange, on the principal national securities
exchange on which is the Common Stock is listed or admitted for trading, or if
not listed or admitted for trading on any national securities exchange, the
closing bid price of the Common Stock as reported by the National Association of
Securities Dealers Automated Quotation System ('NASDAQ') National Market System
(or, if not so reported, the closing price) or, if not admitted for quotation on
the NASDAQ National Market System, the average of the high bid and the low asked
prices as recorded by the National Association of Securities Dealers, Inc.
through NASDAQ, or, if the Common Stock is not traded in the over-the-counter
market, the fair market value of one share of Common Stock on such day as
determined in good faith by the Board of Directors (which decision shall be
conclusive). For purposes of this Section 4, 'Market Price' shall mean the
average of the Closing Bid Price for the five trading days prior to the Date of
Conversion (as herein defined). Such conversion shall be effectuated by
surrendering the Debentures to be converted by overnight courier to the
Company's registrar and transfer agent, American Stock Transfer & Trust Co.
('Transfer Agent'), with the form of conversion notice attached hereto as
Exhibit A (with an advance copy of the Debenture and the conversion notice to
the Transfer Agent and the Company by facsimile), executed by the Holder of this
Debenture evidencing such Holder's intention to convert this Debenture, and
accompanied, in the event the Holder desires to register the shares of Common
Stock in a name other than that of Holder, by proper assignment hereof. The
Company and the Transfer Agent shall make a reasonable effort to deliver the
converted shares to the Holder within three business days from date of receipt
of the conversion notice and the original of this Debenture. In the event the
Holder converts the Debenture at the Fixed Conversion Price or Variable
Conversion Price, the accrued interest shall be payable to the Holder in shares
of Common Stock (unless such Debenture is redeemed for cash under the terms of
Section 5 herein), and the interest and number of shares issued upon conversion
shall be calculated as follows:
Number of shares issued upon conversion = (Principal + Interest)/Conversion
Price, where
Principal = The principal amount of the Debenture to be converted,
Interest = Principal x (N/365) x .08, where N = the number of days
from July 28, 1995 to the date of conversion, and
Conversion Price = Either the Fixed Conversion Price or the Variable
Conversion Price, as defined in this paragraph 4 herein, whichever is
applicable at the time of such conversion.
(continued on attached)
(page 3 of 4 of Celgene Corporation Convertible Debenture due July 31, 1997)
In all cases the conversion of this Debenture in full shall represent payment of
all interest and principal payable to the Holder hereunder. No fractions of
shares or scrip representing fractions of shares will be issued on conversion,
but the number of shares issuable shall be rounded up to the nearest whole
share. The date on which notice of conversion is given (the 'Date of
Conversion') shall be deemed to be the date set forth in such notice of
conversion if the original of this Debenture is received by the Transfer Agent
within five business days thereafter. If the original of this Debenture is not
received by the Transfer Agent within five business days after the Date of
Conversion, the notice of conversion shall become null and void. In the event of
any stock split, stock dividend payable in securities of the Company, or other
reclassification of the Common Stock, the conversion price shall be equitably
adjusted so that the Holder shall receive, in exchange for the conversion price,
such securities or other property which it would have received had it converted
this Debenture immediately prior to such stock split, dividend or other
reclassification. No service charge will be made for any such conversion.
5. The Company shall have the right to redeem this Debenture for cash by
giving notice (the 'Redemption Notice') to the Holder by facsimile, original to
follow by two-day courier, within one business day from the date facsimile
notice of conversion is received by the Company. The redemption price shall be
paid to Holder within seven calendar days after such facsimile has been given
except in the event the Common Stock price is below $5.00, in which case the
redemption price shall be paid to Holder within 21 calendar days after such
facsimile notice has been given. The redemption price (the 'Redemption Price')
shall be the greater of a) the amount calculated by multiplying the sum of the
Principal and accrued Interest of this Debenture, as those terms are defined in
paragraph 4 above, by a fraction, the numerator of which shall be the Closing
Bid Price on the proposed Date of Conversion, and the denominator of which shall
be the lesser of the conversion prices described in clauses (a) and (b) of
Section 4 above, and b) 115% of the Principal and accrued Interest of this
Debenture. After receipt of the Redemption Notice, all rights with respect to
this Debenture, including, without limitation, the conversion rights contained
herein (notwithstanding the furnishing by the holder hereof of a notice of
conversion to the Company), shall forthwith terminate, except only the right of
the holder to receive the Redemption Price.
6. The Company is entitled, at its option, any time commencing on October
15, 1995 until July 30, 1996 to require the Holder to convert the Principal and
accrued Interest of this Debenture, as those terms are defined in paragraph 4
above, into shares of Common Stock of the Company at a conversion price for each
share of Common Stock equal to the lesser of a) 75% of the Closing Bid Price on
the date the Company provides notice of conversion and b) 100% of the Closing
Bid Price on July 28, 1995. The Company is entitled, at its option, any time
commencing on July 31, 1996 until July 30, 1997 to require the Holder to convert
the Principal and accrued Interest of this Debenture, as those terms are defined
in paragraph 4 above, into shares of Common Stock of the Company at a conversion
price for each share of Common Stock equal to the lesser of (a) or (b) of
Section 4 above. In either case, the Company shall notify the Holder of the
Company's intent to force conversion by giving written notice ('Notice of
Mandatory Conversion') to the Holder by facsimile, original to follow by two-day
courier, before midnight, New York City time, on the date of such mandatory
conversion. The Company is not entitled to require conversion under this Section
6 if the Company makes any planned press release either a) on the day it
provides such Notice of Mandatory Conversion to the Holder or b) prior to the
close of trading on the following business day.
7. Except as expressly provided herein, no provision of this Debenture
shall alter or impair the obligation of the Company, which is absolute and
unconditional, to pay the principal of, and interest on, this Debenture at the
time, place, and rate, and in the coin or currency, herein prescribed. This
Debenture and all other Debentures now or hereafter issued of similar terms are
direct obligations of the Company. This Debenture ranks pari passu with all
other Debentures now or hereafter issued under the terms set forth herein.
8. Except as provided by applicable law, no recourse shall be had for the
payment of the principal of, or the interest on, this Debenture, or for any
claim based hereon, or otherwise in respect hereof, against any incorporator,
shareholder, officer or director, as such, past, present, or future, of the
Company or of any successor corporation, whether by virtue of any constitution,
statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise, all such liability being, by the acceptance hereof and as part of the
consideration for the issue hereof, expressly waived and released.
9. After this Debenture shall have been surrendered for conversion as
herein provided or notice of conversion shall have been given by the Company
pursuant to Section 6 herein, this Debenture shall no longer be deemed to be
outstanding and all rights with respect to this Debenture, including, without
limitation, the right to recei ve interest hereon and the principal hereof,
shall forthwith terminate as of the Date of Conversion, except only the right of
the holder hereof to receive shares of Common Stock in exchange herefor.
10. This Debenture shall not entitle the holder hereof to any of the rights
of a stockholder of the Company, including without limitation, the right to
vote, to receive dividends and other distributions, or to receive any notice of,
or to attend, meetings of stockholders or any other proceedings of the Company.
11. If this Debenture shall be mutilated, lost, stolen or destroyed, the
Company shall execute and deliver, in exchange and substitution for and upon
cancellation of a mutilated Debenture, or in lieu of or in substitution for a
lost, stolen or destroyed Debenture, a new Debenture for the principal amount of
this Debenture so mutilated, lost, stolen or destroyed but only upon receipt of
evidence of such loss, theft or destruction of such Debenture, and of the
ownership thereof, and indemnity, if requested, all reasonably satisfactory to
the Company.
12. Any Holder of this Debenture, by acceptance hereof, agrees that such
Holder will not offer, sell or otherwise dispose of this Debenture or the shares
of Common Stock issuable upon exercise thereof except under circumstances which
will not result in a violation of the Act, including Regulation S promulgated
under the Act, or any applicable state Blue Sky law or similar laws relating to
the sale of securities and the holder agrees to provide the Company with such
documentation as the Company shall deem necessary in accordance with Section 4
of the Regulation S subscription agreement executed by the original holder
hereof to demonstrate that
(continued on attached)
(page 4 of 4 of Celgene Corporation Convertible Debenture due July 31, 1997)
such offer, sale or disposition complied with applicable securities laws. This
provision shall similarly apply to subsequent transfers of this Debenture.
13.This Debenture shall be governed by and construed in accordance with the
laws of the State of Delaware, without giving effect to conflicts of laws.
14.For purposes hereof, the term 'business day' shall mean any day on which
banks are generally open for business in the State of Delaware, USA and
excluding any Saturday and Sunday.
15. In the event of a merger, reorganization, recapitalization or similar
event of or with respect to the Company (a 'Corporate Change') (other than a
Corporate Change in which all or substantially all of the consideration received
by the holders of the Company's equity securities upon such Corporate Change
consists of cash or assets other than securities issued by the acquiring entity
or any affiliate thereof), this Debenture shall be assumed by the acquiring
entity and thereafter this Debenture shall be convertible into such class and
type of securities as the Holder would have received had the Holder converted
this Debenture immediately prior to such Corporate Change.
16. Any notice or other communication required or permitted to be given
hereunder shall be given as provided herein or delivered against receipt if to
(i) the Company at, 7 Powder Horn Drive, Warren, New Jersey 07059, Telecopy No.
(908) 805-3931 and (ii) the holder of this Debenture, to such holder at its last
address as shown on the Debenture Register (or to such other address as the
party shall have furnished in writing in accordance with the provisions of this
Section 16). Any notice or other communication mail shall be deemed given at the
time of receipt thereof.
17. Any waiver by the Company or the holder hereof of a breach of any
provision of this Debenture shall not operate as or be construed to be a waiver
of any other breach of such provision or of any breach of any other provision of
this Debenture. The failure of the Company or the holder hereof to insist upon
strict adherence to any term of this Debenture on one or more occasions shall
not be considered a waiver or deprive that party of the right thereafter to
insist upon strict adherence to that term or any other term of this Debenture.
Any waiver must be in writing.
18. If any provision of this Debenture is invalid, illegal or
unenforceable, the balance of this Debenture shall remain in effect, and if any
provision is inapplicable to any person or circumstance, it shall nevertheless
remain applicable to all other persons and circumstances.
EXHIBIT A
NOTICE OF CONVERSION
(To be Executed by the Registered Holder
in order to Convert the Debenture)Holder
The undersigned hereby irrevocably elects to convert the above Debenture No.
___________ into shares of Common Stock, par value $.01 per share (the 'Common
Stock'), of Celgene Corporation (the 'Company') according to the conditions
hereof, as of the date written below. If shares are to be issued in the name of
a person other than undersigned, the undersigned will pay all transfer taxes
payable with respect thereto and is delivering herewith such certificates and
opinions as reasonably requested by the Company. No fee will be charged to the
Holder for any conversion, except for transfer taxes, if any.
If this Debenture is being converted during the Restricted Period (as that term
is defined in the subscription agreement executed by the original purchaser of
this Debenture), the undersigned represents that it is not a U.S. Person as
defined in Regulation S promulgated under the United States Securities Act of
1933, as amended (the 'Act') and is not converting the Debenture on behalf of
any U.S. Person. The undersigned also represents and warrants that all offers
and sales by the undersigned of the shares of Common Stock issuable to the
undersigned upon conversion of the Debenture shall be made in compliance with
Regulation S, pursuant to registration of the Common Stock under the Act or
pursuant to an exemption from registration under the Act.
Conversion calculations: --------------------------------
Date of Conversion
--------------------------------
Applicable Conversion Price
--------------------------------
Signature
--------------------------------
Name
Address
--------------------------------
--------------------------------
* The original Debenture and Notice of Conversion must be received by the
Company's Transfer Agent before any shares of Common Stock will be issued. If
the original of this Debenture is not received by the Transfer Agent (or such
other person as the Company may specify) within five business days after the
date of conversion specified above, this notice of conversion shall become null
and void.