ARIAD Pharmaceuticals,Inc. (NASDAQ:ARIA) Files An 8-K Entry into a Material Definitive Agreement

ARIAD Pharmaceuticals,Inc. (NASDAQ:ARIA) Files An 8-K Entry into a Material Definitive Agreement

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Item 1.01 Entry into a Material Definitive
Agreement.

Agreement and Plan of Merger

On January8, 2017, ARIAD Pharmaceuticals,Inc. (the Company or we)
entered into an Agreement and Plan of Merger (the Merger
Agreement) with Takeda Pharmaceutical Company Limited (Parent or
Takeda), a corporation organized under the laws of Japan, and
Kiku Merger Co.,Inc. (Merger Sub), a Delaware corporation and an
indirect wholly-owned subsidiary of Parent. The Boards of
Directors of both the Company and Parent have unanimously
approved the Merger Agreement.

to the Merger Agreement, upon the terms and subject to the
conditions thereof, Merger Sub will commence a tender offer (the
Offer) no later than January24, 2017, to acquire all of the
outstanding shares of common stock of the Company, $0.001 par
value per share (the Shares), at a purchase price of $24 per
Share (the Offer Price) in cash, net of applicable withholding
taxes and without interest.

The obligation of Merger Sub to purchase Shares tendered in the
Offer is subject to the satisfaction or waiver of customary
conditions set forth in the Merger Agreement, including (i)that
the number of Shares validly tendered and not withdrawn as of the
expiration of the Offer, together with any Shares owned by Parent
and its affiliates and excluding any Shares tendered to
guaranteed delivery procedures that have not yet been received
(as such term is defined in Section251(h)(6)(f)of the Delaware
General Corporate Law, as amended (DGCL)), represents at least a
majority of the then outstanding Shares (the Minimum Tender
Condition), and (ii)the expiration or termination of the waiting
period under the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended.

As soon as practicable following the consummation of the Offer
and subject to the satisfaction or waiver of certain conditions
set forth in the Merger Agreement, Merger Sub will be merged with
and into the Company (the Merger), with the Company surviving the
Merger as an indirect wholly-owned subsidiary of Parent (the
Surviving Corporation). The Merger will be governed by
Section251(h)of the DGCL and effected without a vote of the
Company stockholders. As a result of the Merger, each Share
(other than as Shares (i)owned by Parent, Merger Sub or any other
direct or indirect wholly-owned subsidiary of Parent immediately
prior to the Effective Time, (ii)owned by the Company or any
direct or indirect wholly-owned subsidiary of the Company or held
in the Companys treasury or (iii)held by a holder who is entitled
to appraisal and who has properly exercised appraisal rights for
such Shares in accordance with Section262 of the DGCL) will be
converted automatically into the right to receive the Offer Price
in cash, net of applicable withholding taxes and without
interest.

The Merger Agreement also provides that each Company stock
option, share of Company restricted stock, Company restricted
stock unit and Company performance stock unit (collectively, the
Company Equity Awards) that is outstanding as of immediately
prior to the consummation of the Offer will accelerate and become
fully vested (except that, in the case of a Company performance
stock unit, such awards shall vest at the greater of (i)the
target level of vesting for such Company performance stock unit
and (ii)the vesting level determined based on the actual
satisfaction of the performance metrics applicable to such
Company performance stock unit measured by the Compensation
Committee of our Board of Directors as of immediately prior to
the Offer expiration time) as of immediately prior to, and
contingent upon, the consummation of the Offer (subject to
certain exceptions with respect to vesting acceleration) and will
be canceled and converted into the right to receive the Offer
Price (less the applicable exercise price in the case of Company
stock options) in cash (net of applicable withholding taxes and
without interest) payable in respect of each Share subject to
such Company Equity Award. At or prior to the consummation of the
Offer, the Company, our Board of Directors and the Compensation
Committee of our Board of Directors, as applicable, are required
to adopt resolutions and take any actions that are necessary to
effectuate the provisions of the Merger Agreement with respect to
the Company Equity Awards. In addition, to the Merger Agreement,
the Company is required, among other things, to take all
reasonable actions to terminate its 1997 Employee Stock Purchase
Plan prior to the date that the Offer, the Merger and the other
transactions contemplated by the Merger Agreement (collectively,
the Transactions) close.

The Merger Agreement includes representations and warranties, and
covenants of the parties customary for a transaction of this
nature. Until the earlier of the termination of the Merger
Agreement and the date on which the Merger becomes effective (the
Effective Time), the Company has agreed to operate its business
and the business of its subsidiaries in the ordinary course,
consistent with past practice, and has agreed to certain other
operating covenants, as set forth more fully in the Merger
Agreement. Subject to the terms and conditions of the Merger
Agreement, the Company has also agreed not to solicit or initiate
discussions with any third party regarding acquisition proposals.

The Merger Agreement includes a remedy of specific performance
for the Company, Parent and Merger Sub. The Merger Agreement also
includes customary termination provisions for both the Company
and Parent and provides that, in connection with the termination
of the Merger Agreement under specified circumstances, including
termination by the Company to accept


and enter into a definitive agreement with respect to a
superior proposal, the Company will be required to pay a
termination fee of $169 million (the Termination Fee). Any such
termination of the Merger Agreement by the Company is subject
to certain conditions, including the Companys compliance with
certain procedures set forth in the Merger Agreement and a
determination by our Board of Directors that the failure to
take such action would reasonably be expected to be
inconsistent with its fiduciary duties, payment of the
Termination Fee by the Company and execution of a definitive
agreement by the Company with such third party. A superior
proposal is defined in the Merger Agreement generally as a bona
fide written unsolicited offer or proposal made by a
third-party relating to (i)the issuance to such person or group
(as defined in the Securities Exchange Act of 1934, as amended
(the Exchange Act), and the rulespromulgated thereunder) or
acquisition by such person or group of at least 50% of equity
interests in the Company or (ii)the acquisition by such person
or group of at least 50% of the consolidated assets of the
Company and its subsidiaries, in each case to a merger,
reorganization or other business combination, sale of shares of
capital stock, sale of assets, tender offer, exchange offer or
other similar transaction, that is on terms that our Board of
Directors determines in its good faith judgment is reasonably
likely to be consummated and would, if consummated, result in a
transaction that is more favorable to the Companys stockholders
from a financial point of view than the Transactions.

The foregoing description of the Merger Agreement is not
complete and is qualified in its entirety by reference to the
Merger Agreement, which is filed as Exhibit2.1 to this report
and incorporated herein by reference. The Merger Agreement, and
the foregoing description of the Merger Agreement, have been
included to provide investors and our stockholders with
information regarding the terms of the Merger. The assertions
embodied in the representations and warranties contained in the
Merger Agreement are qualified by information in confidential
disclosure schedules. Moreover, certain representations and
warranties in the Merger Agreement were made as of a specified
date, may be subject to a contractual standard of materiality
different from what might be viewed as material to
stockholders, or may have been used for the purpose of
allocating risk between the parties to the Merger Agreement.
Accordingly, the representations and warranties in the Merger
Agreement should not be relied on by any persons as
characterizations of the actual state of facts and
circumstances about the Company, Parent or Merger Sub at the
time they were made or otherwise, and information in the Merger
Agreement should be considered in conjunction with the entirety
of the factual disclosure about the Company in the Companys
public reports filed with the U.S. Securities and Exchange
Commission (the SEC). Information concerning the subject matter
of the representations and warranties may change after the date
of the Merger Agreement, which subsequent information may or
may not be fully reflected in the Companys public disclosures.

Tender Agreements

Concurrently with entering into the Merger Agreement, directors
of the Company and two funds affiliated with Sarissa Capital
Management LP (Sarissa Capital, of which the Chairman of our
Board of Directors is the Chief Investment Officer) who
collectively beneficially own an aggregate of 15,219,504 Shares
(including Shares acquired by such stockholder upon the
exercise of Company stock options) have each entered into a
Tender Agreement (collectively, the Tender Agreements) with the
Parent and Merger Sub. to the Tender Agreements, such directors
and affiliated stockholders have agreed to tender into the
Offer all Shares beneficially owned by them and not to withdraw
any such Shares previously tendered. They have also agreed to
vote, and have appointed the Parent as their proxy to vote, all
Shares beneficially owned by them against (i)any action or
agreement that would reasonably be expected to result in (A) a
breach of any covenant, representation or warranty of the
Company contained in the Merger Agreement or (B) any of the
conditions to the Offer or the Merger not being satisfied in
accordance with the terms of the Merger Agreement; (ii)any
change in our Board of Directors; and (iii)any proposed action,
agreement or transaction involving the Company that would
reasonably be expected, to impede, interfere with, delay,
postpone, adversely affect or prevent the consummation of the
Transactions. In addition, under the Tender Agreements, such
stockholders have agreed, subject to limited exceptions, not to
transfer, assign or otherwise dispose of the Shares
beneficially owned by them other than to the Offer.

The Tender Agreements will terminate upon the occurrence of
certain circumstances, including a termination of the Merger
Agreement in accordance with its terms. In addition, the
stockholders obligations to vote and tender to the Tender
Agreements are suspended upon certain adverse changes in our
Board of Directors recommendation of the Transactions, the
stockholders obligations to vote and tender to the Tender
Agreements is suspendedand are automatically reinstated upon a
renewal of the Board of Directors recommendation of the
Transactions. The foregoing description of the Tender
Agreements is not complete and is qualified in its entirety by
reference to the form of Tender Agreement, which is filed as
Exhibit99.3 to this report and incorporated herein by
reference.

Item 1.02 Termination of a Material
Definitive Agreement

In connection with the Merger, on January8, 2016, the Company
entered into a Call Option and Warrant Termination Agreement
(the Termination Agreement) with JP Morgan Chase Bank, National
Association, London Branch (the Counterparty), to which the
Company and the Counterparty agreed to terminate (i)the base
call option transaction entered into between the Company and
the Counterparty on June12, 2014 in connection with the
issuance of the Companys Notes (as defined below) and (ii)the
base warrant transaction entered into between the Company and
the Counterparty on June 12, 2014. Under the terms of the
Termination Agreement, no payment was or shall be made or
received by either party in connection with such termination.

The foregoing description of the Termination Agreement does not
purport to be complete and is qualified in its entirety by


reference to the Termination Agreement, which is filed as
Exhibit10.1 hereto and is incorporated herein by reference.

Item 7.01 Regulation FD Disclosure.

On January 9, 2017, in connection with the execution of the
Merger Agreement and the Transactions, the Company issued a
Notice of Fundamental Change and Make-Whole Fundamental Change
(the Notice) to the holders of its 3.625% Convertible Senior
Notes due 2019 (the Notes) issued to the Indenture dated as of
June 17, 2014, between the Company and Wells Fargo Bank,
National Association, as Trustee (the Indenture).

The Notice provides information relevant to the holders of the
Notes, including, among other things, that:

(i) the anticipated closing date of the Offer is February 15,
2017 (the Anticipated Fundamental Change Date), which is solely
provided for purposes of complying with the Indenture as the
actual closing date of the Offer, cannot yet be determined by
the Company;

(ii) due to the execution of the Merger Agreement, the holders
may convert their Notes from (a) the date of the Notice until
(b) the business day preceding the Fundamental Change
Repurchase Date (as defined in the Indenture);

(iii) upon the occurrence of a Make-Whole Fundamental Change,
the holders may convert their Notes at a make-whole premium
from (a) the effective date of the Fundamental Change until (b)
the Fundamental Change Repurchase Date (as defined in the
Indenture); and

(iv) upon the occurrence of a Fundamental Change (as defined in
the Indenture), the holders may require the Company to
repurchase their Notes for cash at a repurchase price equal to
50% of the principal amount of the Notes, together with accrued
and unpaid interest thereon to, but excluding, the Fundamental
Change Repurchase Date.

The foregoing description of the Notice is not complete and is
qualified in its entirety by reference to the Notice, which is
filed as Exhibit 99.4 to this report and incorporated herein by
reference.

The information presented above is being furnished to Item 7.01
of this Current Report on Form 8-K and shall not be deemed
filed for purposes of Section 18 of the Exchange Act or
otherwise subject to the liabilities of that Section, nor shall
it be deemed incorporated by reference in any filing under the
Securities Act of 1933, as amended, or the Exchange Act except
as shall be expressly set forth by specific reference in such
filing.

Additional Information

The Offer described in this Current Report on Form8-K and
documents attached hereto has not yet commenced. This Current
Report on Form8-K and documents attached hereto is provided for
informational purposes only and does not constitute an offer to
purchase or the solicitation of an offer to sell any
securities. At the time the Offer is commenced, Takeda and its
wholly owned subsidiary, Merger Sub, intend to file with the
SEC a Tender Offer Statement on Schedule TO containing an offer
to purchase, a form of letter of transmittal and other
documents relating to the tender offer, and the Company intends
to file with the SEC a Solicitation/Recommendation Statement on
Schedule 14D-9 with respect to the Offer. Takeda, Merger Sub
and the Company intend to mail these documents to the Companys
stockholders. Investors and stockholders should read those
filings carefully when they become available as they will
contain important information about the tender offer. Those
documents may be obtained without charge at the SECs website at
www.sec.gov. The offer to purchase and related materials may
also be obtained (when available) for free by contacting the
information agent for the tender offer.

Cautionary Statement Regarding Forward-Looking
Statements

This Current Report on Form8-K and documents attached hereto
contain forward-looking information related to Takeda, the
Company and the proposed acquisition of the Company by Takeda
that involves substantial risks and uncertainties that could
cause actual results to differ materially from those expressed
or implied by such statements. These forward-looking statements
generally include statements that are predictive in nature and
depend upon or refer to future events or conditions, and
include words such as believes, plans, anticipates,
projects, estimates, expects, intends, strategy, future,
opportunity, may, will, should, could, potential, or similar
expressions.
Forward-looking statements in this document
include, among other things, statements about the potential
benefits of the proposed acquisition, anticipated earnings
accretion and growth rates, the Anticipated Fundamental Change
Date, Takedas and the Companys plans, objectives, expectations
and intentions, the financial condition, results of operations
and business of Takeda and the Company, the Companys products,
the Companys pipeline assets and development, the acceleration
of the development of cancer treatments; the expected timing of
brigatinib approval in the U.S., and the anticipated timing of
closing of the acquisition. Risks and uncertainties include,
among other things, risks related to the satisfaction of the
conditions to closing the acquisition (including the failure to
obtain necessary regulatory approvals) in the anticipated
timeframe or at all, including uncertainties as to how many of
the Companys stockholders will tender their shares in the
tender offer and the possibility that the acquisition does not
close; risks related to the ability to realize the anticipated
benefits of the acquisition, including the possibility that the
expected benefits from the proposed acquisition will not be
realized or will not be realized within the expected time
period; the risk that the businesses will not be integrated
successfully; disruption from the transaction making it more
difficult to maintain business and operational relationships;
negative effects of this announcement or the consummation of
the proposed acquisition on the market price of Takedas common
stock and on Takedas operating results; significant transaction
costs; unknown liabilities; the risk of litigation and/or
regulatory actions related to the proposed acquisition; other
business effects, including the effects of industry, market,
economic, political or regulatory conditions; future exchange
and interest rates; changes in tax and other laws, regulations,
rates and policies; future business combinations or disposals;
the uncertainties inherent in research and development,
including the ability to sustain and increase the rate of
growth in revenues for the Companys products despite increasing
competitive, reimbursement and economic challenges; whether and
when any drug applications may be filed in any jurisdictions
for any indications or any additional indications for the
Companys products or for the Companys pipeline assets; whether
and when the FDA or any other applicable regulatory authorities
may approve any such applications, which will depend on its
assessment of the benefit-risk profile suggested by the
totality of the efficacy and safety information submitted;
decisions by the FDA or other regulatory authorities regarding
labeling and other matters that could affect the availability
or commercial potential of the Companys products and the
Companys pipeline assets; and competitive developments. Other
factors that may cause actual results to differ materially
include those set forth in the reports that the Company files
from time to time with the SEC, including its annual report on
Form10-K for the fiscal year ended December31, 2015 and
quarterly and current reports on Form10-Q and 8-K, as well as
the Tender Offer Statement on Schedule TO and other tender
offer documents filed by Merger Sub and Parent.

Many of these factors are beyond Takedas and the Companys
control. Unless otherwise required by applicable law, Takeda
and the Company disclaim any intention or obligation to update
forward-looking statements contained in these documents as the
result of new information or future events or developments.


Item 8.01 Other Events.

On January9, 2017, the Company and Parent issued a joint press
release announcing the proposed Transactions, a copy of which
is filed as Exhibit99.1 to this report and incorporated herein
by reference. On January9, 2017, the Company issued a press
release announcing the proposed Transactions, a copy of which
is filed as Exhibit99.2 to this report and incorporated herein
by reference.

Item 9.01. Financial Statements and Exhibits.

(d)Exhibits:

Exhibit Number

Description

2.1*

Agreement and Plan of Merger, dated as of January8, 2017,
by and among ARIAD Pharmaceuticals,Inc., Takeda
Pharmaceutical Company Limited and Kiku Merger Co.,Inc.

10.1

Call Option and Warrant Termination Agreement, dated as
of January8, 2017, between ARIAD Pharmaceuticals,Inc. and
JP Morgan Chase Bank, National Association, London
Branch.

99.1

Joint press release, dated January9, 2017, issued by
ARIAD Pharmaceuticals,Inc. and Takeda Pharmaceutical
Company Limited relating to the proposed acquisition of
ARIAD Pharmaceuticals, Inc.

99.2

Press release, dated as of January9, 2017, issued by
ARIAD Pharmaceuticals,Inc. relating to the proposed
acquisition of ARIAD Pharmaceuticals,Inc.

99.3

Formof Tender Agreement.

99.4

Notice issued by ARIAD Pharmaceuticals, Inc. on January
9, 2017 to holders of 3.625% Convertible Senior Notes due
2019 issued by ARIAD Pharmaceuticals, Inc.

* Schedules omitted to item 601(b)(2)of Regulation S-K. The
Company agrees to furnish supplementally a copy of any omitted
schedule to the SEC upon request, provided, however, that the
Company may request confidential treatment to Rule24b-2 of the
Securities Exchange Act of 1934, as amended, for any schedule
or exhibit so furnished.


to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.

ARIAD Pharmaceuticals,Inc.

Dated: January10, 2017

By:

/s/ Manmeet S. Soni

Manmeet S. Soni

Chief Financial Officer


EXHIBITINDEX

Exhibit Number

Description

2.1*

Agreement and Plan of Merger, dated as of January8, 2017,
by and among ARIAD Pharmaceuticals,Inc., Takeda
Pharmaceutical Company Limited and Kiku Merger Co.,Inc.

10.1

Call Option and Warrant Termination Agreement, dated as
of January8, 2017, between ARIAD Pharmaceuticals,Inc. and
JP Morgan Chase Bank, National Association, London
Branch.

99.1

Joint press release, dated January9, 2017, issued by
ARIAD Pharmaceuticals,Inc. and Takeda Pharmaceutical
Company Limited relating to the proposed acquisition of
ARIAD Pharmaceuticals, Inc.

99.2

Press release, dated as of January9, 2017, issued by
ARIAD Pharmaceuticals,Inc. relating to the proposed
acquisition of ARIAD Pharmaceuticals,Inc.

99.3

Formof Tender Agreement.

99.4

Notice issued by ARIAD Pharmaceuticals, Inc. on January
9, 2017 to holders of 3.625% Convertible Senior Notes due
2019 issued by ARIAD Pharmaceuticals, Inc.

* Schedules omitted to item 601(b)(2)of Regulation S-K. The
Company agrees to furnish supplementally a copy of any omitted
schedule to the SEC upon request, provided, however, that the
Company may request confidential treatment


About ARIAD Pharmaceuticals, Inc. (NASDAQ:ARIA)

ARIAD Pharmaceuticals, Inc. (ARIAD) is an oncology company. The Company is focused on transforming the lives of cancer patients with medicines. The Company’s product pipeline includes Iclusig (ponatinib), brigatinib, AP32788 and ridaforolimus. The Company’s Iclusig is a tyrosine kinase inhibitor (TKI) that is approved in the United States, the European Union, Australia, Switzerland, Israel and Canada for the treatment of adult patients with chronic myeloid leukemia (CML), and Philadelphia chromosome-positive acute lymphoblastic leukemia (Ph+ ALL). Its Brigatinib is an investigational inhibitor of anaplastic lymphoma kinase (ALK). Its AP32788 is a TKI, which is designed as a targeted therapy for patients with non-small cell lung cancer (NSCLC) with specific mutations in two kinases, epidermal growth factor receptor (EGFR), or human epidermal growth factor receptor 2 (HER2). Its Ridaforolimus is an investigational inhibitor of the mammalian target of rapamycin (mTOR).

ARIAD Pharmaceuticals, Inc. (NASDAQ:ARIA) Recent Trading Information

ARIAD Pharmaceuticals, Inc. (NASDAQ:ARIA) closed its last trading session down -0.07 at 23.68 with 62,154,877 shares trading hands.

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