Icahn Enters Into Telik Derivative Pacts >TELK
Jun 6, 2007 10:37:43 (ET)
Investor Carl Icahn's Icahn Associates Corp. on Wednesday said some of its affiliates recently entered into derivative agreements with "counterparties" related to 1.84 million shares of Telik Inc. (TELK) stock.
The derivative agreements, known as total return swaps, provide that the profit or loss to the Icahn group will be based on an increase or decrease in value of the shares, according to a Securities and Exchange Commission filing.
As a result, in addition to the shares the Icahn group already owns, it also has "long economic exposure" to 1.84 million more through the agreements.
In a proxy statement filed April 11, Telik reported that the Icahn group held a 9.91% stake, with beneficial ownership of about 5.2 million shares.
The derivative agreements will be settled in cash and don't give Icahn or his affiliates direct or indirect voting, investment or dispositive control over the shares, the SEC filing said. The Icahn group also disclaims any beneficial ownership in shares tied to the agreements.
On Monday, Telik said the Food and Drug Administration had placed a clinical hold on its investigational new drug application for Telcyta after data from a late-stage trial of the anti-cancer compound was presented at the annual meeting of the American Society of Clinical Oncology.
The Palo Alto, Calif., biopharmaceutical company also said that no new patients will be enrolled in Telcyta clinical trials and that current patients won't receive additional treatment until the FDA releases the hold.
Telik said it plans to submit to the FDA additional safety information and hopes to meet with agency officials "as soon as possible."
Shares of Telik recently traded at $3.32, off 10 cents.
-Brian Coyle, Dow Jones Newswires; 202-862-3545 |
