**Exhibit 10.4**

 

 

 
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STOCK PURCHASEAGREEMENT

By and Between

SMITHKLINE BEECHAMCORPORATION AND GLAXO GROUP LIMITED

 

AND

 

PRAECISPHARMACEUTICALS INCORPORATED

Dated as of April7, 2006

 
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STOCK PURCHASEAGREEMENT

STOCK PURCHASE AGREEMENT(this “Agreement”), dated as of April 7, 2006, by and between SmithKlineBeecham Corporation, a corporation organized under the laws of Pennsylvania,having a principal place of business at One Franklin Plaza, 200 N. 16th Street, Philadelphia, Pennsylvania 19102 (“SBC”)and Glaxo Group Limited, a company organized under the laws of England andWales, having its registered office at Glaxo Wellcome House, Berkeley AvenueGreenford, Middlesex, UB6 ONN, United Kingdom (“GGL”, and with SBCcollectively, the “Investor” and each sometimes referred to herein as an “Investor”),and PRAECIS PHARMACEUTICALS INCORPORATION (the “Company”), a corporationorganized under the laws of Delaware with its principal place of business at830 Winter Street, Waltham, Massachusetts 02451-1420.

WHEREAS, concurrentlywith the execution of this Agreement, the Investor and the Company have enteredinto a Pilot Study and Option Agreement (the “Pilot Study Agreement” andtogether with this Agreement, the “Transaction Agreements”); and

WHEREAS, it iscontemplated by the Pilot Study Agreement that the Investor purchase, and theCompany issue and sell to the Investor, shares of common stock of the Companypursuant to the terms and conditions of this Agreement.

NOW, THEREFORE, inconsideration of the foregoing, and the representations and warranties andmutual promises and obligations contained herein, and for other good andvaluable consideration, the adequacy and sufficiency of which are herebyacknowledged, the Investor and the Company agree as follows:

**ARTICLE 1DEFINITIONS**

1.1           Defined Terms.  When used in this Agreement, the followingterms shall have the respective meanings specified therefor below:

“Affiliate” of aPerson shall mean any other Person which directly or indirectly controls, iscontrolled by, or is under common control with, such Person.  A Person shall be deemed to “control” anotherPerson if it (i) owns, directly or indirectly, beneficially or legally, votingsecurities or other comparable ownership interest representing a majority ofthe voting power of all outstanding voting securities or other comparableownership interest of such other Person generally entitled to vote for theelection of members of the board of directors or comparable governing body ofsuch other Person, or (ii) has the power, whether pursuant to contract,ownership of securities or otherwise, to direct the management and policies ofsuch other Person.

“Announcement Date” shall mean the date theCompany issues a press release announcing the execution of the TransactionAgreements pursuant to Section 8.11 of this Agreement.

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“Business Day” shall mean any day other than aSaturday or Sunday or a day on which banks located in New York, New York areauthorized or required by law to close.

“Common Stock” shall mean the Company’s CommonStock, par value $0.01 per share, together with the associated Rights.

“Disposition” or “Dispose of” shall meanany (i) offer, pledge, sale, contract to sell, sale of any option or contractto purchase, purchase of any option or contract to sell, grant of any option,right or warrant for the sale of, or other disposition of or transfer of anyInvestment Shares or (ii) swap or any other agreement or any transaction thattransfers, in whole or in part, directly or indirectly, the economicconsequence of ownership of the Investment Shares, whether any such swap ortransaction is to be settled by delivery of securities, in cash or otherwise.

“Governmental Authority” shall mean any federal,state, municipal, local, provincial or regional governmental authority in theUnited States or other political subdivision thereof and any Person exercisingexecutive, legislative, judicial, regulatory or administrative functions of orpertaining to government.

“Investment Shares” shall mean the total numberof shares of Common Stock, determined as provided in Section 2.2, to be issuedby the Company and purchased by the Investor at the Closing.

“Material Adverse Effect” shall mean anyevents, occurrences or circumstances which give rise to or would reasonably beexpected to give rise to, individually or in the aggregate, a material adverseeffect on the business, condition (financial or otherwise) or results ofoperations of the Company.

“Organizational Documents” shall mean theCompany’s Amended and Restated Certificate of Incorporation, as amended, as ineffect on the date hereof, and the Company’s Third Amended and Restated Bylaws,as in effect on the date hereof.

“Per Share Price” shall mean the average of thedaily closing prices per share of the Common Stock on The Nasdaq National Market, as reported inthe Wall Street Journal, over the trading days during the period beginning on,and including, March 11, 2006, and ending on, and including, April 25, 2006.

“Person” shall mean and include an individual,a partnership, a joint venture, a corporation, a limited liability company, alimited liability partnership, a trust, an incorporated organization and aGovernmental Authority.

“Rights” shall mean the rights issued orissuable under the Rights Agreement.

“Rights Agreement” shall mean the RightsAgreement dated as of January 24, 2001 between the Company and American StockTransfer & Trust Company, as Rights Agent.

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1.2           Additional Defined Terms.  In addition to the terms defined in Section1.1, the following terms shall have the respective meanings assigned thereto inthe sections indicated below:
|   | Defined Term            |   | Section   |   |
|--------|-------------------------|--------|-----------|--------|
|   |                    |   |      |   |
|   | Agreement               |   | Preambles |   |
|   | Closing                 |   | 2.3       |   |
|   | Closing Date            |   | 2.3       |   |
|   | Company                 |   | Preambles |   |
|   | Company SEC  Documents  |   | 3.7(a)    |   |
|   | Exchange Act            |   | 3.7(a)    |   |
|   | GGL                     |   | Preambles |   |
|   | Investor                |   | Preambles |   |
|   | Pilot Study  Agreement  |   | Preambles |   |
|   | Purchase Price          |   | 2.1       |   |
|   | Rule 144                |   | 4.5       |   |
|   | SBC                     |   | Preambles |   |
|   | SEC                     |   | 3.5       |   |
|   | Securities Act          |   | 3.7(a)    |   |
|   | Severed Clause          |   | 8.10      |   |
|   | Stock Plan              |   | 3.2       |   |
|   | Transaction  Agreements |   | Preambles |   |

 

1.3           Construction.  In this Agreement, unless the contextotherwise requires:

(a)       any reference in this Agreement to “writing”or comparable expressions includes a reference to facsimile transmission orcomparable means of communication;

(b)       words expressed in the singular numbershall include the plural and vice versa, words expressed in the masculine shallinclude the feminine and neuter gender and vice versa;

(c)       references to Articles and Sections arereferences to articles and sections of this Agreement;

(d)       reference to “day” or “days” are tocalendar days; and

(e)       “include,” “includes,” and “including”are deemed to be followed by “without limitation” whether or not they are infact followed by such words or words of similar import.

**ARTICLE 2PURCHASE AND SALE OF COMMON STOCK**

2.1           Issuance and Purchase of CommonStock.  Subject to the terms andconditions hereof, the Company agrees to issue and sell to the Investor at theClosing, and SBC and GGL 

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jointly and severally agree to purchase at theClosing, the Investment Shares, for an aggregate purchase price of $500,000(the “Purchase Price”).

(a)       Determination of Investment Shares.  The number of shares of Common Stock thatwill be issued by the Company and purchased by the Investor at the Closingshall be the quotient, rounded to the nearest whole number, obtained bydividing the Purchase Price by the Per Share Price; provided, however, that inno event will the number of shares of Common Stock that will be issued by theCompany and purchased by the Investor hereunder exceed 19.9% of the shares ofCommon Stock issued and outstanding as of the date of this Agreement.  The Investment Shares shall be registered54.16% in the name of GGL and 45.84% in the name of SBC, in each case roundedto the nearest full share.

2.2           Closing.  Subject to the satisfaction or waiver of eachof the conditions set forth in Article 6, the closing of the purchase and saleof the Investment Shares (the “Closing”) shall occur on April 28, 2006or such other time, date and place as are mutually agreed upon by the Investorand the Company. The date on which the Closing occurs is referred to as the “ClosingDate.” The Closing shall take place at the offices of Skadden, Arps, Slate,Meagher, & Flom, LLP, One Beacon Street, Boston, Massachusetts.

2.3           Closing Obligations.

(a)       At the Closing, the Company shall deliverto the Investor:

(i)            stock certificates, registered inthe names of GGL and SBC, representing the Investment Shares; and

(ii)           the certificates specified in Section6.1(c).

(b)       At the Closing, the Investor shall (andeach of SBL and GCL jointly and severally agree to) deliver to the Company thePurchase Price by wire transfer of immediately available funds to the Company’saccount in accordance with wire transfer instructions provided by the Companyto the Investor at least three Business Days prior to the Closing.

**ARTICLE 3REPRESENTATIONS AND WARRANTIES OF THE COMPANY**

The Company herebyrepresents and warrants to the Investor as of the date hereof as follows:

3.1           Organization, Good Standing andQualification.  The Company is acorporation duly organized, validly existing and in good standing under thelaws of the State of Delaware.  TheCompany has all requisite corporate power and corporate authority to own andoperate its properties and assets, to carry on its business as now conductedand as proposed to be conducted in the Company SEC Documents, to enter intothis Agreement as described, and to issue and sell the Investment Shares to theInvestor as provided in this Agreement.

3.2           Capitalization.  The authorized capital of the Company as ofApril 7, 2006 consisted of 200,000,000 shares of Common Stock, par value $0.01per share, of which, as of 

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April 7, 2006, (i) 10,513,055 shareswere issued and outstanding, (ii) 2,193,583 shares remained authorized andavailable for issuance under the Company’s Third Amended and Restated 1995Stock Plan (the “Stock Plan”), of which 1,651,354 were reserved for issuanceupon the exercise of outstanding stock options granted under the Stock Plan,and (iii) 23,332 shares remained authorized and available for issuance underthe Company’s Second Amended and Restated Employee Stock Purchase Plan.  All of the issued and outstanding shares ofCommon Stock have been duly authorized, validly issued, and are fully paid andnon-assessable.

3.3           Authorization.  All corporate action on the part of theCompany, its directors and stockholders necessary for the authorization, executionand delivery of this Agreement by the Company, and the performance of allobligations of the Company hereunder, including the authorization, issuance anddelivery of the Investment Shares, has been taken.  This Agreement has been duly executed and delivered by the Company and, upondue execution and delivery by the Investor, will constitute a valid and legallybinding obligation of the Company, enforceable against the Company inaccordance with its terms, except as such enforceability may be limited by (i)applicable bankruptcy, insolvency, reorganization, moratorium or other laws ofgeneral application relating to or affecting enforcement of creditors’ rightsand (ii) rules of law governing specific performance, injunctive relief orother equitable remedies and limitations of public policy.

3.4           No Conflicts.  The execution and performance of thisAgreement and compliance with the provisions thereof by the Company, do not andwill not: (a) violate any provision of law, statute, ordinance, rule or regulationor any ruling, writ, injunction, order, permit, judgment or decree of anyGovernmental Authority, (b) constitute a breach of, or default under, (or anevent which, with notice or lapse of time or both, would become a defaultunder,) or conflict with, or give rise to any right of termination,cancellation or acceleration of, any agreement, arrangement or instrument,whether written or oral, by which the Company or any of its assets are bound,or (c) violate or conflict with any of the provisions of the Company’sOrganizational Documents; except, in the case of subsections (a) and (b) aswould not have a Material Adverse Effect.

3.5           No Governmental Consents orFilings.  No consent, approval,authorization or other order of, or filing with, any Governmental Authority isrequired to be obtained or made by the Company in connection with the Company’sexecution, delivery and performance of this Agreement including the issuanceand sale pursuant to this Agreement of the Investment Shares, except suchfilings as may be required to be made with the Securities and ExchangeCommission (the “SEC”), any state blue sky or securities regulatoryauthority and The Nasdaq Stock Market, which filings shall be made in a timelymanner in accordance with all applicable laws, rules, regulations, statutes,ordinances and orders.

3.6           Valid Issuance of InvestmentShares.  When issued, sold anddelivered in accordance with the terms hereof for the consideration providedherein, the Investment Shares shall be duly authorized, validly issued, fullypaid and nonassessable, free from any encumbrances or restrictions on transferother than restrictions on transfer under this Agreements and under federal andstate securities laws.

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3.7           Company SEC Documents; FinancialStatements; Nasdaq Stock Market.

(a)       Since December 31, 2004, the Company hasfiled all required reports, schedules, forms, statements and other documents(including exhibits and all other information incorporated therein) with theSEC (such filings since such date, the “Company SEC Documents”).  As of their respective filing dates, each ofthe Company SEC Documents complied in all material respects with therequirements of the Securities Act of 1933, as amended (the “Securities Act”),or the Securities Exchange Act of 1934, as amended (the “Exchange Act”),and the rules and regulations of the SEC promulgated thereunder applicable tosuch Company SEC Documents, and no Company SEC Document when filed containedany untrue statement of a material fact or omitted to state a material factrequired to be stated therein or necessary in order to make the statementstherein, in light of the circumstances under which they were made, notmisleading.

(b)       The audited consolidated financialstatements of the Company included in its Annual Report on Form 10-K for thefiscal year ended December 31, 2005 comply as to form in all material respectswith applicable accounting requirements and the published rules and regulationsof the SEC with respect thereto, and present fairly, in all material respects,the consolidated financial position of the Company at December 31, 2005 and2004, and the consolidated results of its operations and its cash flows foreach of the three years in the period ended December 31, 2005, in conformitywith generally accepted accounting principles in the United States as of thedates thereof and the results of its operations and cash flows for the periodsthen ended.

(c)       The Common Stock is listed on The NasdaqStock Market and the Company has taken no action designed to, or which to itsknowledge is likely to have the effect of, terminating the registration of theCommon Stock under the Exchange Act or delisting the Common Stock from TheNasdaq Stock Market.

3.8           Offering.  Subject to the accuracy of the Investor’srepresentations set forth in Sections 4.3, 4.4 and 4.5, the offer, sale andissuance of the Investment Shares to be issued in conformity with the terms ofthis Agreement constitute transactions which are exempt from the registrationrequirements of the Securities Act and from all applicable state registrationor qualification requirements.

**ARTICLE4REPRESENTATIONS AND WARRANTIES OF THE INVESTOR**

SBC and GGL herebyjointly and severally represent and warrant to the Company as of the datehereof as follows:

4.1           Organization;Good Standing.  Each Investor is acorporation duly organized, validly existing and in good standing under thelaws of its jurisdiction of incorporation. Each Investor has all requisite corporate power and corporate authorityto enter into this Agreement and to purchase the Investment Shares as providedherein.

4.2           Authorization.  All corporate action on the part of eachInvestor, and its directors and stockholders necessary for the authorization,execution and delivery of this Agreement by the Investor, and the performanceof all obligations of the Investor hereunder, including the purchase of theInvestment Shares, has been taken.  ThisAgreement has been duly executed and 

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delivered by each Investor and, upon due execution anddelivery by the Company, will constitute a valid and legally binding obligationof each Investor, enforceable against each Investor in accordance with itsterms, except as such enforceability may be limited by (i) applicablebankruptcy, insolvency, reorganization, moratorium or other laws of generalapplication relating to or affecting enforcement of creditors’ rights and (ii)rules of law governing specific performance, injunctive relief or otherequitable remedies and limitations of public policy.

4.3           Purchase Entirely for Own Account.  The Investment Shares shall be acquired forinvestment for each Investor’s own account, not as a nominee or agent, and notwith a view to the resale or distribution of any part thereof, and neitherInvestor has any present intention of selling, granting any participation, orotherwise distributing the Investment Shares. Neither Investor has any contract, undertaking, agreement or arrangementwith any Person to sell, transfer or grant participation to a Person any of theInvestment Shares.

4.4           Investment Experience andAccredited Investor Status.  EachInvestor is an “accredited investor” (as defined in Regulation D under theSecurities Act).  Each Investor has suchknowledge and experience in financial or business matters that it is capable ofevaluating the merits and risks of the investment in the Investment Shares tobe purchased hereunder.

4.5           Restricted Securities.  Each Investor understands that the InvestmentShares, when issued, shall be “restricted securities” under the federal securitieslaws inasmuch as they are being acquired from the Company in a transaction notinvolving a public offering and that under such laws and applicable regulationssuch securities may be resold without registration under the Securities Actonly in certain limited circumstances. In connection with this, each Investor represents that it is familiarwith Rule 144 of the Securities Act, as presently in effect (“Rule 144”).

**ARTICLE 5**COVENANTS

5.1           Further Assurances.  The parties agree to take such reasonable stepsand execute such other and further documents as may be necessary or appropriateto cause the terms and conditions contained herein to be carried into effect.

5.2           Limitations on Dispositions.

(a)       Through the second anniversary of theClosing Date, neither of the Investors nor any of their respective Affiliatesshall make any Disposition, except, upon prior written notice to the Company,to an Affiliate of such Investor, provided such Affiliate shall, and shallagree in writing with the Company that it shall, be subject to the samerestrictions on Dispositions set forth in, and bound by the other provisionsof, this Article 5 applicable to the Investor. After the second anniversary of the Closing Date, the Investor and theirrespective Affiliates (taken together) may Dispose in a single calendar quarterof no more than 25% of the Investment Shares purchased at the Closing (subjectto stock splits, reverse stock splits, combinations, recapitalizations andsimilar events).

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(b)       With respect to any sale or transfer ofthe Investment Shares, each Investor or its Affiliate, as the case may be,shall not make any such sale or transfer unless the sale or transfer is madepursuant to Rule 144 or similar provisions of federal securities laws as ineffect from time to time.

(c)       In the event the Company proposes to sellsecurities in an underwritten offering or private placement prior to April 7,2010, the Investor shall, if requested by the Company and, if applicable, theunderwriter or placement agent in such transaction, agree not to sell orotherwise transfer or dispose of any Common Stock of the Company held by theInvestor for a specified period of time, such period of time not to exceedninety (90) days; provided all the Company’s directors and officers are similarlybound.  Such agreement shall be inwriting in a form satisfactory to the Company and underwriter or placementagent, if applicable, in such transaction. The Company may impose stop transfer instructions with respect to theCommon Stock subject to the foregoing restrictions until the end of the lock-upperiod.  The Company may request no morethan one (1) lock-up period per calendar year.

5.3           Legends.  The certificate representing the InvestmentShares shall bear the following legends:

(a)       “These securities have not beenregistered under the Securities Act of 1933. They may not be sold, offered for sale, pledged or hypothecated in theabsence of a registration statement in effect with respect to the securities underthe Securities Act or an opinion of counsel (which counsel shall be reasonablysatisfactory to the issuer) that such registration is not required or unlesssold pursuant to Rule 144 of the Securities Act.”;

(b)       any legend required by applicable statesecurities laws; and

(c)       “These securities are also subject to andshall be transferable only upon the terms and conditions of a Stock PurchaseAgreement dated as of April 7, 2006, a copy of which is on file with theSecretary of the Issuer.”

5.4           Current Public Information.  For so long as the Common Stock continues tobe registered under the Exchange Act or, if earlier, until such time as theInvestor no longer holds any of Investment Shares, the Company shall:

(a)       make and keep available, at all times,adequate public information as required under paragraph (c) of Rule 144 underthe Securities Act; and

(b)       file with the SEC in a timely manner allreports and other documents required of the Company under Sections 13, 14, and15(d) of the Exchange Act.

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**ARTICLE 6**CONDITIONS

6.1           Conditions to the Obligation ofInvestor. The obligation of the Investor to purchase the Investment Sharespursuant to this Agreement is subject to the satisfaction at or prior to theClosing Date of the following conditions, any and all of which may be waived inwhole or in part by the Investor to the extent permitted by applicable law:

(a)       No Order or Decree. No order,decree, judgment, or injunction shall have been issued by a GovernmentalAuthority and shall be in effect which restrains, enjoins, prevents, orotherwise makes illegal the consummation of the purchase and sale of theInvestment Shares pursuant to this Agreement.

(b)       Representations and Warranties.Each of the representations and warranties of the Company in Article 3 shall betrue and correct in all material respects as of the Closing Date as though madeon and as of the Closing Date (or, to the extent any such representation andwarranty speaks only as of a specific date or period, as of such date orperiod).

(c)       At the Closing, Investor shall havereceived (i) a certificate of the Company dated the Closing Date and executedby an authorized officer of the Company certifying to the fulfillment of thecondition specified in Section 6.1(b) and (ii) a good standing certificate withrespect to the Company issued by the Secretary of State of the State ofDelaware as of a recent date prior to the Closing Date.

6.2           Conditions to the Obligation ofthe Company. The obligation of the Company to issue and sell the InvestmentShares to the Investor pursuant to this Agreement is subject to thesatisfaction at or prior to the Closing Date of the following conditions, anyand all of which may be waived in whole or in part by the Company to the extentpermitted by applicable law:

(a)       No Order or Decree. No order,decree, judgment, or injunction shall have been issued by a GovernmentalAuthority shall be in effect which restrains, enjoins, prevents, or otherwisemakes illegal the consummation of the purchase and sale of the InvestmentShares pursuant to this Agreement.

(b)       Representations and Warranties.Each of the representations and warranties of each Investor in Article 4 shallbe true and correct in all material respects as of the date of this Agreementand as of the Closing Date as though made on and as of the Closing Date (or, tothe extent any such representation and warranty speaks only as of a specificdate or period, as of such date or period).

**ARTICLE 7TERMINATION**

7.1           Termination by Mutual Consent.  This Agreement may be terminated at any timeprior to the Closing by mutual written consent of the Investor and the Company.

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7.2           Termination by Either Party.  This Agreement may be terminated by eitherInvestor or the Company if the Closing shall not have occurred by May 3, 2006; provided,however, that the right to terminate pursuant to this Section 7.2 shallnot be available to any party whose breach of this Agreement has been the causeof, or resulted in, the failure of the Closing to occur on or before May 3,2006.

7.3           Effect of Termination. In theevent that this Agreement is terminated pursuant to this Article 7, thisAgreement shall be of no further force or effect and no party shall have anyfurther liability or obligation hereunder, except that such termination shallnot relieve any party from liabilities or damages arising out of any breach ofthis agreement prior to termination.

**ARTICLE 8**MISCELLANEOUS

8.1           Remedies.  In case any one or more of therepresentations, warranties, covenants or agreements set forth in thisAgreement shall have been breached by any party hereto, the party or partiesentitled to the benefit of such covenants or agreements may proceed to protectand enforce their rights either by suit in equity or action at law, including,but not limited to, an action for damages as a result of any such breach or anaction for specific performance of any such covenant or agreement contained inthis Agreement.  The rights, powers andremedies of the parties under this Agreement are cumulative and not exclusiveof any other right, power or remedy which such parties may have under any otheragreement or law.  No single or partialassertion or exercise of any right, power or remedy of a party hereunder shallpreclude any other or further assertion or exercise thereof.

8.2           Successors and Assigns.  Except as otherwise expressly providedherein, the terms and conditions of this Agreement shall inure to the benefitof and be binding upon the respective successors and assigns of theparties.  Except as otherwise expresslyprovided herein, neither this Agreement nor any of the rights or obligationshereunder may be assigned by either party without (a) the prior written consentof the Company in the case of any assignment by the Investor, or (b) the priorwritten consent of the Investor in the case of any assignment by the Company,except in each case to any third party who acquires all or substantially all ofthe business of the assigning party by merger, sale of assets orotherwise.  Notwithstanding theforegoing, upon prior written notice to the Company, the Investor may assignthe right and obligation to purchase the Investment Shares for the PurchasePrice, and all of its other rights and obligations hereunder, to any of itsAffiliates; provided that the Investor shall remain liable for the performanceof such obligations.

8.3           Entire Agreement.  This Agreement contains the completeunderstanding of the parties to this Agreement with respect to the subjectmatter hereof and supersedes all prior understandings and writings relating tothe subject matter hereof.

8.4           Governing Law; Submission toJurisdiction.  This Agreement will beconstrued, and the respective rights of the Investor and the Company hereunderdetermined, according to the substantive law of the State of Delaware, withoutregard to the provisions governing conflicts 

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of law.  Each ofthe Investor and the Company irrevocably submits to the exclusive jurisdictionof the state courts of, or the United States federal courts located in thestate of Delaware, for purposes of any suit, action or other proceeding arisingout of this Agreement or any transaction or matter contemplated hereby, andeach of the Investor and the Company irrevocably agrees that it will not objectto such venue or the jurisdiction of such courts.

8.5           Counterparts.  This Agreement may be executed incounterparts, each of which shall be deemed an original but which togethershall constitute one and the same instrument.

8.6           Titles and Subtitles.  The titles and subtitles used in thisAgreement are used for convenience only and are not to be considered inconstruing or interpreting this Agreement.

8.7           Notices.  All notices, instructions and othercommunications hereunder or in connection herewith shall be in writing, shallbe sent to the address of the relevant party set forth below and shall be (a)delivered personally, (b) sent by registered or certified mail, return receiptrequested, postage prepaid, (c) sent via a reputable nationwide overnightcourier service, or (d) sent by facsimile transmission, with a confirmationcopy to be sent by registered or certified mail, return receipt requested,postage prepaid.  Any such notice,instruction or communication shall be deemed to have been delivered uponreceipt if delivered by hand, three (3) Business Days after it is sent byregistered or certified mail, return receipt requested, postage prepaid, one(1) Business Day after it is sent via a reputable nationwide overnight courierservice, or when transmitted with electronic confirmation of receipt, iftransmitted by facsimile (if such transmission is made during regular businesshours of the recipient on a Business Day; or otherwise, on the next BusinessDay following such transmission).  Eitherparty may change its address by giving notice to the other party in the mannerprovided above.
| ** ** | **GGL:**                     | ** ** | **With a required copy to:**     |
|------------|------------------------------|------------|----------------------------------|
|       | Glaxo Wellcome House         |       | GlaxoSmithKline                  |
|       | Berkeley Avenue              |       | 2301 Renaissance Blvd.           |
|       | Greenford, Middlesex         |       | MailStop RN0220                  |
|       | UB6 0NN                      |       | King of Prussia, PA 19101        |
|       | United Kingdom               |       | Attn: Vice President &       |
|       | Attn: Corporate  Secretariat |       | Associate General Counsel        |
|       | Facsimile: 44 20 8047  6904  |       | Facsimile: 610-787-7084          |
|       |                         |       |                             |
|       |                         |       |                             |
| ** ** | **SBC:**                     | ** ** | **With a required copy to:**     |
|       | One Franklin Plaza  (FP2355) |       | GlaxoSmithKline                  |
|       | 200 N. 16th Street      |       | One Franklin Plaza (PFP2355)     |
|       | Philadelphia, PA 19102       |       | 200 N. 16th Street 19102    |
|       | Attn: Corporate  Secretariat |       | Philadelphia, PA 19102           |
|       | Facsimile: 215-751-5349      |       | Attn: VP & Associate General |
|       |                         |       | Counsel, Corporate Functions- US |
|       |                         |       | Facsimile: 215-751-5349          |

 

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| ** ** | **Praecis:**                   | ** ** | **With a required copy to:**                 |
|------------|--------------------------------|------------|----------------------------------------------|
|       | Praecis Pharmaceuticals  Inc.  |       | Kent Coit, Esquire                           |
|       | 830 Winter Street              |       | Skadden, Arps, Slate, Meagher & Flom LLP |
|       | Waltham, Massachusetts  02451  |       | One Beacon Street                            |
|       | Attn: Chief Executive  Officer |       | Boston, Massachusetts 02108                  |
|       | Facsimile: 781-890-7471        |       | Facsimile: 617-573-4822                      |

 

8.8           Expenses.  Each party shall pay its own fees andexpenses with respect to this Agreement and the transactions contemplatedhereby.

8.9           Amendments and Waivers.  Any term of this Agreement may be amended andthe observance of any term of this Agreement may be waived (either generally orin a particular instance and either retroactively or prospectively), only withthe written consent of the Company and the Investor.

8.10         Severability.  If, under applicable laws, any provisionhereof is invalid or unenforceable, or otherwise directly or indirectly affectsthe validity of any other material provision(s) of this Agreement (“SeveredClause”), then, it is mutually agreed that this Agreement shall endureexcept for the Severed Clause.  Theparties to this Agreement shall consult and use their reasonable best effortsto agree upon a valid and enforceable provision which shall be a reasonablesubstitute for such Severed Clause in light of the intent of this Agreement.

8.11         Press Release.  The Company shall issue a press releaseannouncing the signing of the Transaction Agreements no later than one (1)Business Day following the date of this Agreement.

 

**[SignaturePage Follows]**

 

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IN WITNESSWHEREOF, the parties have executed and delivered this Agreement as of the datefirst above written.
|        | PRAECIS PHARMACEUTICALS  INCORPORATED                  |
|--------|--------------------------------------------------------|
|   |                                                   |   |
|   | By:                                                    | /s/ Kevin F. McLaughlin |   |   |
|   |                                                   | Name: Kevin F. McLaughlin |   |   |
|   |                                                   | Title:   President and CEO |   |   |
|   |                                                   |   |   |   |
|   |                                                   |   |   |   |
|   | SMITHKLINE BEECHAM CORPORATION,  D/B/A GLAXOSMITHKLINE |
|   |                                                   |   |
|   | By:                                                    | /s/ Donald F. Parman |   |   |
|   |                                                   | Name: Donald F. Parman |   |   |
|   |                                                   | Title:   Vice President and Secretary |   |   |
|   |                                                   |   |   |   |
|   |                                                   |   |   |   |
|   | GLAXO GROUP LIMITED                                    |
|   |                                                   |   |
|   | By:                                                    | /s/ Simon Bicknell |   |   |
|   |                                                   | Name: Simon Bicknell |   |   |
|   |                                                   | Title:   Company Secretary |   |   |
|        |                                                        |  |  |  |  |

 

 

 

 

SIGNATURE PAGE TOSTOCK PURCHASE AGREEMENT

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