Exhibit 4.1
SHAREHOLDERS' AGREEMENT
This SHAREHOLDERS' AGREEMENT (this "AGREEMENT") is made as of the 5th
day of August, 2000 by and among Cubist Pharmaceuticals, Inc., a Delaware
corporation ("CUBIST"), C&T Acquisition Corporation, a corporation duly
organized under the laws of the Province of British Columbia, Canada, and a
wholly-owned subsidiary of Cubist ("ACQUISITION SUB"), each of the other
entities and individuals who agree to become parties to this Agreement by
executing and delivering to Cubist a counterpart signature page to this
Agreement (each a "SHAREHOLDER" and, collectively, the "SHAREHOLDERS").
Capitalized terms not defined herein shall have the same meaning ascribed to
such terms in the Acquisition Agreement (as defined below).
WHEREAS, concurrently with the execution of this Agreement, Cubist,
Acquisition Sub, TerraGen Discovery, Inc., a corporation duly organized under
the laws of the Province of British Columbia, Canada (the "COMPANY"), and the
Shareholders' Representative are entering into an Acquisition Agreement in the
form of EXHIBIT A hereto (the "ACQUISITION AGREEMENT"), pursuant to which all of
the outstanding Company Shares shall, subject to the terms and conditions set
forth therein, and without any action on the part of the holders thereof, be
deemed to be transferred to the Acquisition Sub in exchange for Exchangeable
Shares issued by the Acquisition Sub or shares of Cubist Common Stock issued by
Cubist (the "ACQUISITION");
WHEREAS, each Shareholder is a shareholder of the Company and has
determined that the Acquisition is in such Shareholder's best interests;
WHEREAS, Cubist is unwilling to enter into the Acquisition Agreement
and to consummate the transactions contemplated thereunder unless certain
holders of Company Shares execute and deliver this Agreement; and
WHEREAS, the Shareholders are willing to enter into this Agreement to
facilitate the Acquisition and induce Cubist to enter into the Acquisition
Agreement.
NOW, THEREFORE, in consideration of the above and the mutual covenants
and agreements contained herein, and for other good and valuable consideration,
the receipt of which is hereby acknowledged, each of the parties hereto hereby
agrees as follows:
1. DEFINITIONS. The following terms shall have the following meanings:
"Acquisition Documents" means this Agreement (including any schedule or
exhibit hereto), the Acquisition Agreement (including any schedule or exhibit
thereto), and any other agreement, instrument, certificate, or other document
delivered by or on
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behalf of any party hereto or the Company in connection with this Agreement, the
Acquisition Agreement, or any of the other transactions contemplated hereby or
thereby.
"Acquisition Shares" means the shares of Cubist Common Stock issued at
the Effective Time pursuant to the Acquisition and/or the shares of Cubist
Common Stock issued or issuable upon exchange of Exchangeable Shares issued at
the Effective Time pursuant to the Acquisition.
"Certificate Limit" has the meaning ascribed to the term in Section 116
of the INCOME TAX ACT.
"Clearance Certificate" means a certificate issued pursuant to Section
116 of the INCOME TAX ACT.
"Consideration Stock" means (i) the Cubist Common Stock issued at the
Effective Time pursuant to the Acquisition, (ii) the Exchangeable Shares issued
at the Effective Time pursuant to the Acquisition and/or (iii) the Exchanged
Shares.
"Escrow Fund" shall have the meaning ascribed to such term in the
Escrow Agreement.
"Exchanged Shares" means the shares of Cubist Common Stock issued upon
exchange of Exchangeable Shares issued at the Effective Time pursuant to the
Acquisition.
"INCOME TAX ACT" means the Income Tax Act (Canada), as amended, and the
rules and regulations promulgated thereunder.
"Indemnified Party" shall mean any party asserting a claim for
indemnification under Section 4 of this Agreement.
"Indemnifying Party" shall mean any party against whom a claim for
indemnification under Section 4 of this Agreement has been asserted.
"Non-Resident Person" means, at the particular time that the context of
this Agreement requires, a Person who is not a resident of Canada for purposes
of the INCOME TAX ACT at that particular time.
"Regulation S" shall mean Regulation S promulgated under the Securities
Act, as such Regulation may be amended and in effect from time to time.
"Regulation S Shares" shall mean any Exchanged Shares issued by Cubist
in reliance on Regulation S, which reliance and the need therefor shall be
determined by Cubist in its absolute discretion at the time of such sale or
issuance and shall be conclusively evidenced by affixing the legends required by
Section 7.6(b)(i) hereof.
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"Rule 144" means Rule 144 of the Securities and Exchange Commission
promulgated under the Securities Act.
"Securities Act" means the Securities Act of 1933, as amended.
2. REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS. Each of the
Shareholders hereby represents and warrants to Cubist and Acquisition Sub with
respect to himself, herself or itself only, and on a several and not joint
basis, that as of the date hereof and as of the Closing Date:
(a) OWNERSHIP OF COMPANY SHARES. Such Shareholder owns, as of
the date hereof, and will own, as of the Closing, in each case of record and/or
beneficially, the Company Shares and other securities of the Company, if any,
indicated with respect to such Shareholder on SCHEDULE 2(A) attached hereto, to
be adjusted and updated for exercise of outstanding securities between the date
hereof and the Closing Date, all free and clear of Liens and not subject to any
rights of first refusal of any kind, and such Shareholder has not granted any
rights to purchase such Company Shares or such other securities of the Company
to any other person or entity. Such Shareholder does not own, either legally or
beneficially, any other Company Shares or other securities of the Company.
(b) AUTHORITY. Such Shareholder has all requisite power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. Once executed, this Agreement will have been duly executed
and delivered by such Shareholder, and, assuming the due authorization,
execution and delivery by the other parties hereto, will constitute a valid and
binding obligation of such Shareholder, enforceable in accordance with its
terms, except as the enforceability thereof may be limited by bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or other similar
Laws relating to the enforcement of creditors' rights generally and by general
principles of equity.
(c) TAX MATTERS. Such Shareholder has had an opportunity to
review with his or its own tax advisors the tax consequences to such Shareholder
of the transactions contemplated by the Acquisition Agreement. Such Shareholder
understands that it must rely solely on his or its advisors and not on any
statements or representations by Cubist, Acquisition Sub, the Company, or any of
their respective agents. Such Shareholder understands that he, she or it (and
not Cubist, Acquisition Sub or the Company) shall be responsible for his, her or
its own tax liability that may arise as a result of the transactions
contemplated by this Agreement and the Acquisition Agreement.
(d) PURCHASER QUESTIONNAIRE. If such Shareholder elects to
receive Exchangeable Shares pursuant to the Acquisition, then, at or prior to
the Closing, such Shareholder shall complete, execute and deliver to Cubist a
Purchaser Questionnaire. Such Shareholder hereby represents and warrants that
the information contained therein
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will be, as of the date such Purchaser Questionnaire is delivered to Cubist, and
as of the Closing Date, true, accurate and complete.
(e) NO CONFLICT. The obligations undertaken by such
Shareholder pursuant to Sections 4, 5, and 6 of this Agreement do not and will
not conflict with (i) any mortgage, indenture, lease, contract or other
agreement or instrument, permit, concession, franchise or license to which such
Shareholder or any of his or its properties or assets is subject, or (ii) any
judgment, order, decree, statute, law, ordinance, rule or regulation applicable
to such Shareholder or his or its properties or assets.
3. ACKNOWLEDGEMENT OF AND CONSENT TO CERTAIN PROVISIONS OF THE
ACQUISITION AGREEMENT AND THE ESCROW AGREEMENT. Each Shareholder, for itself and
on behalf of its executors, heirs, legal representatives, personal
representatives and successors, hereby agrees that, by executing this Agreement,
such Shareholder is hereby acknowledging, consenting, accepting and agreeing to
be bound by:
(a) the provisions of the Acquisition Agreement that provide
for the appointment of the Shareholders' Representative and that specify the
rights, powers, duties, responsibilities, liabilities (and the limitations
thereon) of the Shareholders' Representative; and
(b) all of the provisions of the Escrow Agreement, including,
without limitation, (i) the placement of the Escrowed Shares in escrow, (ii) the
appointment of the Escrow Agent, (iii) the rights, powers, duties,
responsibilities, liabilities (and the limitations thereon) of the Shareholders'
Representative under the Escrow Agreement, (iv) the rights, powers, duties,
responsibilities, liabilities (and the limitations thereon) of the Escrow Agent
under the Escrow Agreement, and (v) the right of Cubist to proceed against the
escrow established under the Escrow Agreement in accordance with the provisions
of the Escrow Agreement.
4. INDEMNIFICATION.
4.1. INDEMNIFICATION BY CUBIST AND ACQUISITION SUB. Subject to the
limitations set forth in Section 4.5 hereof, if the Closing occurs and the
Acquisition is consummated, Cubist and Acquisition Sub, jointly and severally,
will indemnify, defend, and hold harmless each of the Shareholders from and
against any and all Damages related to or arising, directly or indirectly, out
of or in connection with:
(a) any breach by Cubist and/or Acquisition Sub of any representation
or warranty made by Cubist and/or Acquisition Sub (collectively, the "CUBIST
REPRESENTATIONS AND WARRANTIES") in any of the Acquisition Documents; or
(b) any breach by Cubist and/or Acquisition Sub of any covenant,
agreement, obligation, or undertaking made by Cubist and/or Acquisition Sub in
any of the Acquisition Documents.
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4.2. INDEMNIFICATION BY THE SHAREHOLDERS.
(a) COMPANY OBLIGATIONS. Subject to the limitations set forth in
Section 4.5 hereof, if the Closing occurs and the Acquisition is consummated,
each of the Shareholders, severally but not jointly, will indemnify, defend, and
hold harmless Cubist, Acquisition Sub, the Company, and each of their respective
directors, officers, employees, agents, representatives, and other Affiliates
(collectively, the "CUBIST INDEMNIFIED PARTIES"), from and against any and all
Damages related to or arising, directly or indirectly, out of or in connection
with:
(i) any breach by the Company of any of the representations or
warranties made by the Company in any of the Acquisition Documents
(collectively, the "COMPANY REPRESENTATIONS AND Warranties");
(ii) any breach by the Company of any covenant, agreement,
obligation, or undertaking made by the Company in any of the Acquisition
Documents; or
(iii) all Third Party Expenses or Filing Fees incurred by the
Company in excess of $1,020,000.
(b) SHAREHOLDER OBLIGATIONS. Subject to the limitations set forth in
Sections 4.5(d), 4.5(e) and 4.5(f) hereof, each of the Shareholders, severally
but not jointly, will indemnify, defend, and hold harmless the Cubist
Indemnified Parties from and against any and all Damages related to or arising,
directly or indirectly, out of or in connection with:
(i) any breach by such Shareholder of any representation,
warranty, covenant, agreement, obligation, or undertaking made by such
Shareholder in any of the Acquisition Documents;
(ii) any failure by such Shareholder to pay any withholding
tax that such Shareholder is obligated to pay to the Canadian government in
connection with such Shareholder's receipt of Consideration Stock; or
(iii) if such Shareholder is a Non-Resident Person, any
failure by such Shareholder to obtain and deliver to Acquisition Sub and Cubist,
prior to such Shareholder's receipt of Consideration Stock, a Clearance
Certificate in connection with such Shareholder's receipt of such Consideration
Stock, which Clearance Certificate has a Certificate Limit not less than the
fair market value of such Consideration Stock on the date of its receipt by such
Shareholder.
4.3. CLAIMS.
(a) All claims for indemnification by an Indemnified Party
pursuant to this Section 4 shall be made in accordance with the provisions of
this Section 4; PROVIDED, HOWEVER, that if and to the extent that any
indemnified party desires or
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seeks to satisfy any claim for indemnification by proceeding against the Escrow
Fund, such Indemnified Party's claim against the Escrow Fund must be made in
accordance with the provisions of the Escrow Agreement.
(b) If an Indemnified Party has incurred or suffered Damages
for which it is entitled to indemnification under this Section 4, such
Indemnified Party shall give prompt written notice of such claim (a "CLAIM
NOTICE") to the Shareholders' Representative, in the case of a claim by a Cubist
Indemnified Party, or to Cubist, in the case of a claim by a Shareholder. Each
Claim Notice shall state the amount of claimed Damages (the "CLAIMED AMOUNT"),
if known, and the basis for such claim. If a Claim Notice indicates that the
claim to which such Claim Notice relates is a claim for indemnification under
section 4.2(b) hereof (a "Section 4.2(b) Claim"), the Shareholders'
Representative shall promptly upon receipt send a copy of such Claim Notice to
the applicable Shareholder against whom such Section 4.2(b) Claim is being made.
Notwithstanding anything in this Agreement to the contrary, the Shareholders'
Representative shall, immediately after sending to a Shareholder a copy of a
Claim Notice pertaining to a Section 4.2(b) Claim against such Shareholder,
cease to act as a representative of such Shareholder for all purposes of such
4.2(b) Claim (except for purposes of any claim against the Escrow Fund in
respect of such Section 4.2(b) Claim), and the Indemnified Party making such
Section 4.2(b) Claim against such Shareholder shall thereafter deal directly
with such Shareholder in connection with all matters pertaining to such Section
4.2(b) Claim (except for purposes of any claim against the Escrow Fund in
respect of such Section 4.2(b) Claim, as to which such Indemnified Party shall
deal directly with the Shareholders' Representative) and, in connection
therewith, such Shareholder shall have all of the powers, rights and obligations
given to the Shareholders' Representative in this Section 4.
(c) Within 30 days after delivery of a Claim Notice, the
Indemnifying Party (who for purposes of this Section 4 shall be represented by
the Shareholders' Representative in the case of a claim by a Cubist Indemnified
Party) shall provide to the Indemnified Party a written response (the "RESPONSE
NOTICE") in which the Indemnifying Party shall: (i) agree that all of the
Claimed Amount is owed to the Indemnified Party, (ii) agree that part, but not
all, of the Claimed Amount (the "AGREED AMOUNT") is owed to the Indemnified
Party, or (iii) contest that any of the Claimed Amount is owed to the
Indemnified Party. If no Response Notice is delivered by the Indemnifying Party
within such 30-day period, the Indemnifying Party shall be deemed to have agreed
that all of the Claimed Amount is owed to the Indemnified Party.
(d) If the Indemnifying Party in the Response Notice agrees
(or is deemed to have agreed) that all of the Claimed Amount is owed to the
Indemnified Party, the Indemnifying Party shall owe to the Indemnified Party an
amount equal to the Claimed Amount to be paid in the manner set forth in this
Section 4. If the Indemnifying Party in the Response Notice agrees that part,
but not all, of the Claimed Amount is owed to the Indemnified Party, the
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Indemnifying Party shall owe to the Indemnified Party an amount equal to the
Agreed Amount set forth in such Response Notice to be paid in the manner set
forth in this Section 4. If there is a dispute as to all or any portion of any
Claimed Amount, the Indemnifying Party and Indemnified Party and/or their
representatives shall attempt in good faith for thirty (30) days to agree upon
the rights of the respective parties with respect to such Claimed Amount or to
the portion thereof in dispute. If the Indemnifying Party and Indemnified Party
should so agree, a memorandum setting forth such agreement shall be prepared and
signed by both parties. If no such agreement can be reached after such good
faith negotiation, either Indemnifying Party or Indemnified Party may, by
written notice to the other (or with respect to notice to any Shareholder, to
the Shareholders' Representative), commence legal proceedings to settle the
dispute.
(e) The Indemnified Party shall give prompt written
notification to the Indemnifying Party of the commencement of any action, suit
or proceeding relating to a third party claim for which indemnification pursuant
to this Section 4 may be sought; provided, however, that no delay on the part of
the Indemnified Party in notifying the Indemnifying Party shall relieve the
Indemnifying Party of any liability or obligation under this Section 4 except to
the extent of any damage or liability caused by or arising out of such delay.
Within 20 days after delivery of such notification, the Indemnifying Party may,
upon written notice thereof to the Indemnified Party, assume control of the
defense of such action, suit or proceeding with counsel reasonably satisfactory
to the Indemnified Party, provided (i) the Indemnifying Party acknowledges in
writing to the Indemnified Party, on behalf of the Indemnifying Party, that any
damages, fines, costs or other liabilities that may be assessed against the
Indemnified Party in connection with such action, suit or proceeding constitute
Damages for which the Indemnified Party shall be entitled to indemnification
pursuant to this Section 4, (ii) the third party seeks monetary damages only,
and (iii) an adverse resolution of the third party's claim would not have a
material adverse effect on the goodwill or the reputation of the Indemnified
Party or the business, operations or future conduct of the Indemnified Party. If
the Indemnifying Party does not so assume control of such defense, the
Indemnified Party shall control such defense. The party not controlling such
defense may participate therein at its own expense; provided that if the
Indemnifying Party assumes control of such defense and the Indemnified Party
reasonably concludes that the Indemnifying Party and the Indemnified Party have
conflicting or different defenses available with respect to such action, suit or
proceeding, the reasonable fees and expenses of counsel to the Indemnified Party
shall be considered "Damages" for purposes of this Agreement. The party
controlling such defense shall keep the other party advised of the status of
such action, suit or proceeding and the defense thereof and shall consider in
good faith recommendations made by the other party with respect thereto. The
Indemnified Party shall not agree to any settlement of such action, suit or
proceeding without the prior written consent of the Indemnifying Party, which
shall not be unreasonably withheld or delayed. The Indemnifying Party shall not
agree to any settlement of or the entry of a judgment in any action, suit or
proceeding without
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the prior written consent of the Indemnified Party, which shall not be
unreasonably withheld (it being understood that it is reasonable to withhold
such consent if, among other things, the settlement or the entry of a judgment
(A) lacks a complete release of the Indemnified Party for all liability with
respect thereto or (B) imposes any liability or obligation on the Indemnified
Party).
4.4. PAYMENT OF CLAIMS. Subject to the provisions set forth below in
this Section 4.4, an Indemnifying Party shall make payment of any portion of any
Claimed Amount that such Indemnifying Party has agreed in a Response Notice that
it owes to an Indemnified Party or that such Indemnifying Party is deemed to
have agreed it owes to such Indemnified Party pursuant to the provisions of
Section 4.3(c) hereof, said payment to be made within thirty (30) days after
such Response Notice is delivered by such Indemnifying Party or should have been
delivered by such Indemnifying Party, as the case may be. Subject to the
provisions set forth below in this Section 4.4, such Indemnifying Party shall
make payment of any portion of any disputed Claimed Amount within five (5) days
following the resolution of the dispute by the Indemnified Party and the
Indemnifying Party or by a court of competent jurisdiction, as the case may be.
The foregoing provisions of this Section 4.4 shall not apply to any portion of
any Claimed Amount that is to be satisfied from the Escrow Fund (it being hereby
understood and agreed that the provisions of the Escrow Agreement shall apply
and govern as to all matters relating to the payment and satisfaction of all or
any portion of any Claimed Amount that is to be satisfied from the Escrow Fund).
4.5. LIMITATIONS OF LIABILITY.
(a) TIME LIMIT. No Indemnifying Party will be required to
indemnify an Indemnified Party pursuant to Section 4.1 or 4.2(a) hereof, as
applicable, unless a written claim for indemnification under Section 4.1 or
4.2(a) hereof, as applicable, is given by the Indemnified Party to the
Indemnifying Party on or prior to the first anniversary of the Effective Date.
(b) THRESHOLD. No Indemnifying Party will be required to
indemnify an Indemnified Party hereunder with respect to any Damages arising on
account of or related to any breach of any of the Company Representations and
Warranties or of any of the Cubist Representations and Warranties, as
applicable, until such time as the aggregate amount of Damages for which (i)
Cubist Indemnified Parties, on the one hand, or (ii) the Shareholders, on the
other hand, are otherwise entitled to indemnification pursuant to this Section 4
exceeds $300,000 (the "Warranty Threshold"), whereupon such Indemnified Party
will be entitled to indemnification for the full amount of all such Damages,
without regard to such threshold amount. The foregoing provisions of this
Section 4.5(b) shall not apply to any breach by the Company of the
representation and warranty set forth in Section 2.15(h) of the Acquisition
Agreement, and the Shareholders shall be required to indemnify the Cubist
Indemnified Parties for Damages resulting from any such breach without regard to
whether the aggregate Damages suffered by Cubist Indemnified Parties for which
they are otherwise entitled to
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indemnification hereunder have exceeded the Warranty Threshold. Any Damages for
which the Shareholders have indemnified Cubist Indemnified Parties pursuant to
the preceding sentence shall not be counted in determining whether the aggregate
amount of Damages suffered by Cubist Indemnified Parties for which they are
otherwise entitled to indemnification hereunder exceeds the Warranty Threshold.
Solely for the purpose of determining whether the aggregate number of Damages
suffered by Cubist Indemnified Parties have at any time exceeded the Warranty
Threshold, any requirement in the representation and warranty covered by the
provisions of Section 2.15(h) that an event or fact be known to the Company
(which is a condition to such event or fact constituting a misrepresentation or
breach of such representation and warranty (the "Knowledge Qualifier")) shall be
ignored. Notwithstanding the provisions of the immediately preceding sentence,
the Knowledge Qualifier in Section 2.15(h) shall at all times continue to be
applicable in determining whether in fact there has been a misrepresentation or
breach of Section 2.15(h) such that it would give rise to a Claim and the
corresponding obligation of the Shareholders to indemnify Cubist therefor.
(c) SPECIAL RECOURSE PROVISIONS; LIMITATION OF LIABILITY FOR
SECTION 4.2(a) CLAIMS. Notwithstanding any other provision in this Agreement to
the contrary, absent fraud by the Company, all claims for indemnification by a
Cubist Indemnified Party under Section 4.2(a) hereof shall be satisfied solely
from the Escrow Fund, and no Shareholder shall have any personal liability for
any claim for indemnification by a Cubist Indemnified Party under Section 4.2(a)
hereof (it being understood and agreed that the sole recourse of such Cubist
Indemnified Party for any such claim for indemnification under Section 4.2(a)
hereof shall be to make a claim against the Escrow Fund pursuant to, and in
accordance with, the provisions of this Agreement and the Escrow Agreement).
(d) MAXIMUM LIABILITY FOR SECTION 4.1(a), 4.1(b) OR SECTION
4.2(b)(i) CLAIMS. Absent fraud by Cubist or Acquisition Sub, the maximum
liability of Cubist and Acquisition Sub for any and all claims for
indemnification against Cubist or Acquisition Sub under Section 4.1(a) shall be
an amount equal to $3,000,000. Absent fraud by Cubist or Acquisition Sub, the
maximum liability of Cubist and Acquisition Sub for any and all claims for
indemnification against Cubist or Acquisition Sub under Section 4.1(b) shall be
an amount equal to $30,000,000. Absent fraud by a Shareholder, the maximum
liability of such Shareholder for any and all claims for indemnification against
such Shareholder under Section 4.2(b)(i) hereof shall be an amount equal to such
Shareholder's pro rata portion of $30,000,000 (such pro rata portion to be
determined based on the relative number of Company Shares owned by the
Shareholders immediately prior to the Effective Time). The limitation of
liability provisions set forth in the immediately preceding sentence shall not
limit the liability of a Shareholder under clauses (ii) and (iii) of Section
4.2(b).
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(e) DEEMED VALUE OF CONSIDERATION STOCK. The value of the
shares of Consideration Stock tendered in payment of any indemnification
obligation hereunder, whether from the Escrow Fund or otherwise, shall be
conclusively deemed to be equal to be $47.66 per share of Consideration Stock
(such dollar figure to be proportionately and equitably adjusted to reflect
stock splits, stock dividends, reverse stock splits, and other
recapitalizations, reorganizations and similar events affecting Cubist Common
Stock and occurring after the date of this Agreement).
(f) TAX AND INSURANCE BENEFITS. The amount of any Damages
otherwise payable to any Indemnified Party hereunder will be reduced (i) to the
extent that such Indemnified Party actually realizes, by reason of such Damages,
any tax benefit that is not offset by any corresponding adjustment of the tax
attributes of such Indemnified Party or any of his or its assets (e.g., any tax
deduction available to such Indemnified Party in respect of such Damages will
not be deemed to result in a tax benefit to such Indemnified Party to the extent
that such deduction results in a decrease in such Indemnified Party's tax basis
in any securities or other assets), and (ii) by any insurance proceeds actually
received by such Indemnified Party in respect thereof, to the extent that such
reduction is permitted without reduction of the amount of such proceeds payable
under the applicable insurance policy.
If any Indemnified Party recovers any amount from any insurer
after payment to such Indemnified Party by one or more Indemnifying Parties of
all Damages suffered or incurred by such Indemnified Party in respect of the
matters to which such insurance payment relates, then such Indemnified Party
will promptly pay over to such Indemnifying Parties the amount so recovered, to
the extent not in excess of the amount previously paid by such Indemnifying
Party to such Indemnified Party in respect of such matter.
4.6. SUBROGATION. An Indemnifying Party who indemnifies an Indemnified
Party pursuant to this Section 4 will, upon indefeasible payment in full of the
amount owed with respect to such matter pursuant to this Section 4, be
subrogated to the extent of such payment to the rights of such Indemnified Party
against all other persons in respect of the matter for which such
indemnification payment was made, to the extent permitted by applicable
insurance policies of such Indemnified Party, and upon such subrogation may
assert such rights against such other persons.
4.7. EXCLUSIVE REMEDIES.
(a) Subject to the provisions of Section 4.7(b) below, the
parties acknowledge and agree that, if the Closing takes place and the
Acquisition is consummated, their sole and exclusive remedies in respect of any
and all claims relating to any breach or purported breach of any representation,
warranty, covenant, agreement, obligation, or undertaking contained in any of
the
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Acquisition Documents will be pursuant to the indemnification provisions of
this Section 4.
(b) Notwithstanding the generality of the provisions of
Section 4.7(a), nothing in this Section 4.7 shall be construed to limit the
non-monetary equitable remedies of any party in respect of any breach by any
other party of any covenant or other agreement contained in any of the
Acquisition Documents.
5. RELEASES. Except as set forth on Schedule 5 hereto, if the Closing
occurs and the Acquisition is consummated, then, effective as of the Effective
Time, each of the Shareholders, for himself or itself and his or its heirs,
legatees, successors, and assigns, hereby fully and irrevocably releases,
remises, and discharges the Company and its officers, directors, employees,
agents, representatives, successors, and assigns from any and all Damages,
regardless of whether known, unknown, or unknowable, and regardless of whether
absolute, contingent, or otherwise, and regardless of whether at law, in equity,
or otherwise, and regardless of whether now existing or arising in the future,
in each case to the extent based on actions, omissions, and/or events occurring
at or before the Effective Time, including without limitation all rights to
indemnification and/or contribution, but excluding Damages and rights of
indemnification arising expressly under this Agreement. Furthermore, each of
such releasing persons hereby irrevocably agrees not to xxx, or to commence,
maintain, or aid in the prosecution of any litigation, arbitration, or other
action or proceeding against or adverse to any of such released persons, or
otherwise to seek any recourse against any of such released persons, in respect
of any matter hereby released or purported or attempted to be released.
6. NO SOLICITATION. Until the earlier of the Effective Time and the
date of termination of the Acquisition Agreement pursuant to the provisions of
Section 8.1 thereof, each Shareholder agrees that it will not, directly or
indirectly, take any of the following actions with any Person other than Cubist
and its designees: (a) solicit, initiate, entertain or encourage any proposals
or offers from, or conduct discussions with or engage in negotiations with, any
Person relating to any possible Business Combination with the Company or any of
its Subsidiaries (whether such Subsidiaries are in existence on the date hereof
or are hereafter organized), (b) provide information with respect to the Company
to any Person, other than Cubist, relating to, or otherwise cooperate with,
facilitate or encourage any effort or attempt by any such Person with regard to,
any possible Business Combination with the Company or any Subsidiary of the
Company (whether such Subsidiaries are in existence on the date hereof or are
hereafter organized), (c) cause the Company to enter into a Contract with any
Person, other than Cubist, providing for a Business Combination with the Company
or any Subsidiary (whether such Subsidiaries are in existence on the date hereof
or are hereafter organized), or (d) make or authorize any statement,
recommendation or solicitation in support of any possible Business Combination
with the Company or any Subsidiary (whether such Subsidiary is in existence on
the date hereof or is hereafter organized) other than by Cubist. Each
Shareholder shall immediately cease and cause to be terminated any such contacts
or negotiations in which it is involved with any Person relating to any such
transaction or Business Combination. In addition to the foregoing, if any
Shareholder
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receives prior to the Effective Time or the termination of the Acquisition
Agreement any offer or proposal (formal or informal) relating to any of the
above, such Shareholder shall immediately notify Cubist thereof and provide
Cubist with the details thereof including the identity of the Person or Persons
making such offer or proposal, and will keep Cubist fully informed of the status
and details of any such offer of proposal. Each Shareholder and Cubist
acknowledge that this Section 6 was a significant inducement for Cubist to enter
into this Agreement and the Acquisition Agreement and the absence of such
provision would have resulted in either (i) a material reduction in the
Acquisition consideration to be paid to the Shareholders or (ii) a failure to
induce Cubist to enter into this Agreement or the Acquisition Agreement.
7. REGISTRATION AND LOCK-UP OF CUBIST COMMON STOCK.
7.1. REGISTRATION OF SHARES. Cubist shall file with the SEC, on or
before the ninetieth (90th) day following the Closing Date, a registration
statement on Form S-3 covering the resale to the public by Shareholders (the
"Registering Shareholders") of the Acquisition Shares (the "Shareholder
Registration Statement"). Cubist shall use commercially reasonable efforts to
cause the Shareholder Registration Statement to be declared effective by the SEC
as soon as practicable following the filing thereof and to remain effective
until the third anniversary of the Closing Date or such earlier time as all of
the Acquisition Shares covered by the Shareholder Registration Statement have
been sold pursuant thereto (the "Effective Period"). Thereafter Cubist shall be
entitled to withdraw the Shareholder Registration Statement and the Shareholders
shall have no further right to offer or sell any of the Acquisition Shares
pursuant to the Shareholder Registration Statement (or any prospectus pursuant
thereto). The shares subject to the Shareholder Registration Statement shall not
be underwritten unless Cubist shall otherwise consent in its sole discretion.
7.2. LIMITATIONS ON REGISTRATION RIGHTS.
(a) Notwithstanding anything in this Section 7 to the
contrary, Cubist may, by written notice to the Registering Shareholders, suspend
the Shareholder Registration Statement after effectiveness (the period of any
such suspension being hereinafter referred to as a "Suspension Period") and
require that the Registering Shareholders immediately cease sales of shares
pursuant to the Shareholder Registration Statement, in the event that (i) Cubist
is engaged in any activity or transaction or preparations or negotiations for
any activity or transaction that Cubist desires to keep confidential for
business reasons, if Cubist determines in good faith that the public disclosure
requirements imposed on Cubist under the Securities Act in connection with the
Shareholder Registration Statement would require disclosure of such activity,
transaction, preparations or negotiations, provided, however, that any such
Suspension Period under this clause (i) shall not exceed ninety (90) days and
shall not be instituted more than twice in any consecutive twelve month period,
or (ii) the Shareholder Registration Statement can no longer be used under the
existing rules and regulations promulgated under the Securities Act. During the
Suspension Period, none of the
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Registering Shareholders shall offer or sell any Acquisition Shares pursuant to
or in reliance upon such registration statement (or the prospectus relating
thereto).
(b) Cubist shall not be required to disclose to the
Registering Shareholders the reasons for requiring a suspension of sales under
the Shareholder Registration Statement, and the Registering Shareholders shall
not disclose to any third party the existence of any such suspension, except as
required by law.
(c) If Cubist suspends the Shareholder Registration Statement
or requires the Shareholders to cease sales of shares pursuant to paragraph (a)
this Section 7.2, Cubist shall, as promptly as practicable following the
termination of the circumstance which entitled Cubist to do so, take such
actions as may be necessary to reinstate the effectiveness of the Shareholder
Registration Statement (if applicable) and give written notice to all
Registering Shareholders authorizing them to resume sales pursuant to the
Shareholder Registration Statement. If as a result thereof the prospectus
included in the Shareholder Registration Statement has been amended to comply
with the requirements of the Securities Act, Cubist shall enclose such revised
prospectus with a notice to Registering Shareholders given pursuant to this
Section 7.2(c), and the Registering Shareholders shall make no offers or sales
of shares pursuant to the Shareholder Registration Statement.
7.3 REGISTRATION PROCEDURES.
(a) In connection with the filing by Cubist of the Shareholder
Registration Statement, Cubist shall furnish to each Shareholder a copy of the
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act. Subject to Section 7.2 hereof, Cubist shall
prepare and file with the SEC such amendments and supplements to the Shareholder
Registration Statement and the prospectus used in connection with such
Shareholder Registration Statement as may be reasonably necessary to keep such
Shareholder Registration Statement effective and to comply with the provisions
of the Securities Act with respect to the disposition of all Acquisition Shares
pursuant to such Shareholder Registration Statement until the earlier of (i)
such time as all such Acquisition Shares have been disposed of, or (ii) the
third anniversary of the Closing Date. Cubist shall furnish to each Registering
Shareholder a copy of any amendment or supplement to such Shareholder
Registration Statement or prospectus prior to filing the same with the SEC, and
shall not file any such amendment or supplement to which any such requesting
Registering Shareholder shall reasonably have objected to in writing prior to
the filing thereof on the grounds that such amendment or supplement contains a
material inaccuracy with respect to the description of such Registering
Shareholder.
(b) If Cubist has delivered preliminary or final prospectuses
to the Registering Shareholders and after having done so the prospectus is
amended or supplemented to comply with the requirements of the Securities Act as
described
-14-
in Section 7.3(a) hereof, Cubist shall promptly notify the Registering
Shareholders and, if requested by Cubist, the Registering Shareholders shall
immediately cease making offers or sales of shares under the Shareholder
Registration Statement and return all prospectuses to Cubist. Cubist shall
promptly provide the Registering Shareholders with revised prospectuses and,
following receipt of the revised prospectuses, the Registering Shareholders
shall be free to resume making offers and sales under the Shareholder
Registration Statement.
(c) Cubist shall furnish to each requesting Registering
Shareholder such number of conformed copies of the Shareholder Registration
Statement and of each such amendment and supplement thereto (in each case
including all exhibits thereto), such number of copies of the prospectus
included in such Shareholder Registration Statement (including each preliminary
prospectus) and such number of documents, if any, incorporated by reference in
such Shareholder Registration Statement or prospectus, as such requesting
Registering Shareholder may reasonably request.
(d) Cubist shall use commercially reasonable efforts to
register or qualify the Acquisition Shares covered by the Shareholder
Registration Statement under the securities or "blue sky" laws of such states as
the Registering Shareholders shall reasonably request; PROVIDED, HOWEVER, that
Cubist shall not be required in connection with this paragraph (d) to qualify as
a foreign corporation or execute a general consent to service of process in any
jurisdiction.
(e) Cubist shall pay the expenses incurred by it in complying
with its obligations under this Section 7, including all registration and filing
fees, exchange listing fees, fees and expenses of counsel for Cubist, and fees
and expenses of accountants for Cubist, but excluding (i) any brokerage fees,
selling commissions or underwriting discounts incurred by the Registering
Shareholders in connection with sales under the Shareholder Registration
Statement and (ii) the fees and expenses of any counsel retained by Registering
Shareholders.
(f) Cubist shall promptly notify each Shareholder of the
happening of any event as a result of which the prospectus included in the
Shareholder Registration Statement contains an untrue statement of a material
fact or omits any fact necessary to make the statements therein misleading, and,
thereafter (but subject to the exercise by Cubist of its suspension right
pursuant to Section 7.2 of this Agreement), will promptly prepare (and, when
completed, give notice to each Registering Shareholder) a supplement or
amendment to such prospectus so that, as thereafter delivered to the purchasers
of such Acquisition Shares, such prospectus will not contain an untrue statement
of a material fact or omit to state any fact necessary to make the statement
therein not misleading.
(g) Notwithstanding anything to the contrary in this
Agreement, in the event that all Acquisition Shares subject to the Shareholder
Registration
-15-
Statement have been sold or may be sold pursuant to Rule 144(k) or Rule 145(d)
of the Securities Act, Cubist shall have the right to withdraw the Shareholder
Registration Statement, whereupon the right of the Registering Shareholders to
sell Acquisition Shares pursuant thereto shall terminate.
7.4 REQUIREMENTS OF COMPANY SHAREHOLDERS.
(a) INFORMATION. Cubist shall not be required to include any
Acquisition Shares in the Shareholder Registration Statement unless the
Registering Shareholder owning such shares furnishes to Cubist in writing such
information regarding such Registering Shareholder and the proposed sale of
Acquisition Shares by such Registering Shareholder as Cubist may reasonably
request in writing in connection with the Shareholder Registration Statement or
as shall be required in connection therewith by the SEC or any state securities
law authorities.
(b) LOCK-UP AGREEMENT. For a period of two years after the
Closing Date, each Shareholder that holds or owns (at the time of the written
request of Cubist or the managing underwriter referred to below in this Section
7.4(b) or at any time during the 90-day period commencing on the effective date
of the registration statement relating to such underwritten public offering of
Cubist's securities) of record or beneficially (within the meaning of Section
13(d) of the Exchange Act and the rules and regulations promulgated thereunder)
shares of Cubist Common Stock hereby agrees that, at the written request of
Cubist or any managing underwriter of any underwritten public offering of
securities of Cubist, such Shareholder shall not, without the prior written
consent Cubist or such managing underwriter, sell, make any short sale of, loan,
grant any option for the purchase of, pledge, encumber, or otherwise dispose of,
or exercise any registration rights with respect to, any shares of Cubist Common
Stock during the 90-day period commencing on the effective date of the
registration statement relating to such underwritten public offering of Cubist's
securities; PROVIDED, HOWEVER, that this obligation shall only apply if all
officers and directors of Cubist and holders of more than 5% of the outstanding
shares of Cubist Common Stock shall also be subject to similar lock-up
restrictions with respect to such underwritten public offering. In order to
enforce the foregoing covenant, Cubist may impose stop transfer instructions
with respect to the shares of Cubist Common Stock owned or held by each
Shareholder, and the Shareholders agree to enter into a customary agreement with
the underwriters of such offering reflecting the lock-up agreement set forth
herein.
7.5 INDEMNIFICATION. In the event that any Acquisition Shares of the
Registering Shareholders are included in a registration statement pursuant to
this Agreement:
(a) To the fullest extent permitted by law, Cubist will
indemnify and hold harmless each Registering Shareholder, any underwriter (as
defined in the
-16-
Securities Act) for Cubist, and each officer, director, fiduciary, employee,
member, general partner and limited partner (and affiliates thereof) of such
Registering Shareholder or such underwriter, each broker or other person acting
on behalf of such Registering Shareholder and each person, if any, who controls
such Registering Shareholder or such underwriter within the meaning of the
Securities Act, against any losses, claims, damages or liabilities, joint or
several, to which they may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue or alleged untrue statement
of any material fact contained in such registration statement, including any
preliminary prospectus or final prospectus contained therein or any amendments
or supplements thereto, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein,
or necessary to make the statements therein not misleading, or any violation by
Cubist of the Securities Act or state securities or blue sky laws applicable to
Cubist and leading to action or inaction required of Cubist in connection with
such registration or qualification under such Securities Act or state securities
or blue sky laws; and will reimburse on demand such Registering Shareholder,
such underwriter, such broker or other person acting on behalf of such
Registering Shareholder or such officer, director, fiduciary, employee, member,
general partner, limited partner, affiliate or controlling person for any legal
or other expenses reasonably incurred by any of them in connection with
investigating or defending any such loss, claim, damage, liability or action,
subject to the provisions of Section 7.5(c); PROVIDED, HOWEVER, that the
indemnity agreement contained in this Section 7.5(a) shall not apply to amounts
paid in settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of Cubist (which consent shall not be
unreasonably withheld), nor shall Cubist be liable in any such case for any such
loss, damage, liability or action to the extent that it arises out of or is
based upon an untrue statement or alleged untrue statement or omission made in
connection with such registration statement, preliminary prospectus, final
prospectus, or amendments or supplements thereto, in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration by the Registering Shareholders, any underwriter for them
or controlling person with respect to them.
(b) To the fullest extent permitted by law, each Registering
Shareholder will indemnify and hold harmless Cubist, each of its directors, each
of its officers who have signed such registration statement, each person, if
any, who controls Cubist within the meaning of the Securities Act, any
underwriter for Cubist (within the meaning of the Securities Act), and all other
Registering Shareholders against any losses, claims, damages or liabilities to
which Cubist or any such director, officer, controlling person, or underwriter
or all other Registering Shareholders may become subject to, under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are based upon any
untrue or alleged untrue statement of any material fact contained in such
registration statement, including
-17-
any preliminary prospectus or final prospectus contained therein or any
amendments or supplements thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent that such untrue statement or alleged untrue statement
or omission or alleged omission was made in such registration statement,
preliminary prospectus, final prospectus, or amendments or supplements thereto,
in reliance upon and in conformity with written information furnished by such
Registering Shareholder expressly for use in connection with such registration;
and such Registering Shareholder will reimburse any legal or other expenses
reasonably incurred by Cubist or any such director, officer, controlling person
or underwriter or all other Registering Shareholders in connection with
investigating or defending any such loss, claim, damage, liability or action,
subject to the provisions of Section 7.5(c), PROVIDED, HOWEVER, that the maximum
amount of liability of each Registering Shareholder hereunder shall be limited
to the proceeds (net of underwriting discounts and commissions, if any) actually
received by such Registering Shareholder from the sale of Acquisition Shares
covered by such registration statement, and PROVIDED, FURTHER, HOWEVER, that the
indemnity agreement contained in this Section 7.5(b) shall not apply to amounts
paid in settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of those Registering Shareholder(s)
against which the request for indemnity is being made (which consent shall not
be unreasonably withheld).
(c) Promptly after receipt by an indemnified party under this
Section 7.5 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against any indemnifying party
under this Section 7.5, notify the indemnifying party in writing of the
commencement thereof and the indemnifying party shall have the right to
participate in and, to the extent the indemnifying party desires, jointly with
any other indemnifying party similarly noticed, to assume at its expense the
defense thereof with counsel mutually satisfactory to the parties; PROVIDED,
HOWEVER, that, if any indemnified party shall have reasonably concluded that
there may be one or more legal defenses available to such indemnified party
which are different from or additional to those available to the indemnifying
party, or that such claim or litigation involves or could have an effect upon
matters beyond the scope of the indemnity agreement provided in this Section
7.5, the indemnifying party shall not have the right to assume the defense of
such action on behalf of such indemnified party, and such indemnifying party
shall reimburse such indemnified party and any person controlling such
indemnified party for the fees and expenses of counsel retained by the
indemnified party which are reasonably related to the matters covered by the
indemnity agreement provided in this Section 7.5. Subject to the foregoing, an
indemnified party shall have the right to employ separate counsel in any such
action and to participate in the defense thereof but the fees and expenses of
such counsel shall not be at the expense of the indemnifying party. The failure
to notify an indemnifying party promptly of the commencement of any such action,
if materially prejudicial to his ability to
-18-
defend such action, shall relieve such indemnifying party of any liability to
the indemnified party under this Section 7.5, but the omission so to notify the
indemnifying party will not relieve him of any liability which the indemnifying
party may have to any indemnified party otherwise other than under this Section
7.5.
(d) If the indemnification provided for in this Section 7 is
unavailable to a person entitled to indemnification hereunder, then each person
that would have been an Indemnifying Party hereunder will, in lieu of
indemnifying such Indemnified Party, contribute to the amount paid or payable by
such Indemnified Party for which indemnification would have been provided herein
in such proportion as is appropriate to reflect the relative fault of the
Indemnifying Party and such Indemnified Party, respectively, in connection with
the statements or omissions which resulted in the loss, damages, etc. underlying
such indemnification obligations. Relative fault will be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied in writing by the Indemnifying Party or such
Indemnified Party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
Cubist and each Shareholder agree that it would not be just and equitable if
contribution pursuant to this Section 7.5(d) were determined by PRO RATA
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to above in this Section 7.5(d). No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) will be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
7.6. SECURITIES LAWS TRANSFER RESTRICTIONS, LEGENDS.
(a) SPECIAL SECURITIES LAW TRANSFER RESTRICTIONS.
(i) The Regulation S Shares shall be subject to the
restrictions on transfer set forth below in this Section 7.6(a)(i). No
Shareholder shall sell, assign, pledge, transfer or otherwise dispose of any
Regulation S Shares, except (A) pursuant to an effective registration statement
under the Securities Act, (B) in accordance with the provisions of Regulation S
or (C) pursuant to an available exemption from registration under the Securities
Act and applicable state securities laws and, if requested by the Company, upon
delivery by such Shareholder of an opinion of counsel reasonably satisfactory to
Cubist to the effect that the proposed transfer is exempt from registration
under the Securities Act and applicable state securities law. Any sale,
assignment, pledge, transfer or other disposition of the Regulation S Shares in
violation of this Section 7.6(a)(i) shall be null and void. Cubist shall not
register on the books and records of Cubist any sale, assignment, pledge,
transfer or other disposition of any of the Regulation S Shares in violation of
this Section 7.6(a)(i).
-19-
(ii) With respect to those Exchanged Shares that are not
Regulation S Shares, no Shareholder shall sell, assign, pledge, transfer or
otherwise dispose or encumber any of such Exchanged Shares, except (A) pursuant
to an effective registration statement under the Securities Act, (B) pursuant to
an available exemption from registration under the Securities Act and applicable
state securities laws and, if requested by Cubist, upon delivery by such
Shareholder of an opinion of counsel reasonably satisfactory to Cubist to the
effect that the proposed transfer is exempt from registration under the
Securities Act and applicable state securities laws or (C) pursuant to the
resale provisions of Rule 144 (or any similar rule or regulation). Any transfer
or purported transfer of any of such Exchanged Shares in violation of this
Section 7.6(a)(ii) shall be null and void. Cubist shall not register on the
books and records of Cubist any sale, assignment, pledge, transfer or other
disposition of any of the Exchanged Shares in violation of this Section
7.6(a)(ii).
(iii) Cubist or Acquisition Sub may, and may instruct any
transfer agentfor them, to place such stop transfer orders as may be required on
their respective transfer books in order to ensure compliance with the
provisions of this Section 7.6.
(b) LEGENDS.
(i) Each certificate or other document evidencing any of the
Regulation S Shares, as determined by Cubist in its sole discretion, shall be
endorsed with the legends set forth below, and each Shareholder covenants that,
except to the extent such restrictions are waived by Cubist, it shall not
transfer the shares represented by any such certificate without complying with
the restrictions on transfer described in this Agreement and the legends
endorsed on such certificate:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT
BE OFFERED, SOLD, TRANSFERRED, ASSIGNED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF IN THE UNITED STATES OR TO U.S. PERSONS, EXCEPT
IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S PROMULGATED UNDER
SUCH ACT, ABSENT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT, OR
UNLESS AN EXEMPTION UNDER SUCH ACT IS THEN AVAILABLE AND, IF REQUESTED
BY THE COMPANY, UPON DELIVERY OF AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE COMPANY THAT THE PROPOSED TRANSFER IS EXEMPT UNDER
SUCH ACT."
(ii) Each certificate or other document evidencing any of the
Exchanged Shares that are issued by Cubist without relying on Regulation S, as
determined by Cubist in its sole discretion, shall be endorsed with the legends
set forth below, and each Shareholder covenants that, except to the extent such
restrictions are waived by Cubist, it shall not transfer the shares represented
by any such certificate without complying with
-20-
the restrictions on transfer described in this Agreement and the legends
endorsed on such certificate:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE OFFERED, SOLD,
ASSIGNED, PLEDGED TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE
OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SAID ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM REGISTRATION UNDER SAID ACT AND, IF REQUESTED
BY THE COMPANY, UPON DELIVERY OF AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE COMPANY THAT THE PROPOSED TRANSFER IS EXEMPT FROM
SAID ACT, OR PURSUANT TO THE RESALE PROVISIONS OF RULE 144."
8. GENERAL.
(a) This Agreement will bind and inure to the benefit of the
parties hereto and their respective heirs, successors, and permitted assigns. No
party will assign any rights or delegate any obligations hereunder without the
consent of the other parties, other than in the case of Cubist, in connection
with (i) an Acquisition or consolidation of Cubist or (ii) a sale of the assets
to which this transaction relates (provided that, in the event of such sale of
assets, Cubist agrees in writing to be bound by the obligations of Cubist under
this Agreement and the Acquisition Agreement), and any attempt to do so will be
void. Nothing in this Agreement is intended to or will confer any rights or
remedies on any person other than the parties hereto and their respective heirs,
successors, and permitted assigns. In addition to the foregoing, none of the
rights of any Shareholder under Section 7 of this Agreement shall be transferred
or assigned to any Person unless such Person is a Qualifying Holder (as defined
below). For purposes of this Section 8(a), the term "QUALIFYING HOLDER" shall
mean, with respect to any Shareholder, (i) any partner thereof, (ii) any
corporation or partnership controlling, controlled by, or under common control
with, such Shareholder, or (iii) any other direct transferee from such
Shareholder of at least 25% of such Shareholder's Acquisition Shares. None of
the rights of any Shareholder under Section 7 of this Agreement shall be
transferred or assigned to any Person (including, without limitation, a
Qualifying Holder) that acquires Acquisition Shares in the event that and to the
extent that such Person is eligible to resell such Acquisition Shares pursuant
to Rule 144(k) or Rule 145(d) of the Securities Act.
(b) All notices, requests, payments, instructions, or other
documents to be given hereunder will be in writing or by written
telecommunication, and will be deemed to have been duly given if (i) delivered
personally (effective upon delivery), (ii) mailed by registered or certified
mail, return receipt requested, postage prepaid (effective five business days
after dispatch), (iii) sent by a reputable, established courier service that
guarantees next business day delivery (effective the next business day), or (iv)
sent by telecopier followed within 24 hours by confirmation by one of the
foregoing
-21-
methods (effective upon receipt of the telecopy in complete, readable form),
addressed as follows (or to such other address as the recipient party may have
furnished to the sending party for the purpose pursuant to this section):
If to Cubist to:
Cubist Pharmaceuticals, Inc.
00 Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: President and Chief Executive Officer
Telecopier No. (000) 000-0000
with a copy sent at the same time and by the same means to:
Xxxxx X. Xxxx, Esq.
Xxxxxxx X. Xxxxxxx, Esq.
Xxxxxxx Xxxx LLP
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Telecopier No. (000) 000-0000
If to any of the Shareholders in care of:
MDS Capital Corp.
000 Xxxxxxxxxxxxx Xxxxxxxxx
Xxxxxxx, Xxxxxxx X0X 0X0
Attn: Legal Department
Telecopier No. (000) 000-0000
with a copy sent at the same time and by the same means to:
MDS Capital Corp.
000 Xxxx 0xx Xxxxxx
Xxxxx 000
Xxxxxxxxx, XX X0X 0X0
Attn: Xx. Xxxxxxx Xxxxxxx
Telecopier No. (000) 000-0000
(c) This Agreement may be executed by the parties in separate
counterparts, each of which when so executed and delivered will be an original,
and all of which together will constitute one and the same agreement. In
pleading or proving this Agreement, it will not be necessary to produce or
account for more than one such counterpart.
(d) The captions of sections or subsections of this Agreement
are for reference only and will not affect the interpretation or construction of
this Agreement.
-22-
(e) The language used in this Agreement is the language chosen
by the parties to express their mutual intent, and no rule of strict
construction will be applied against any party.
(f) No waiver of any breach or default hereunder will be valid
unless in a writing signed by the waiving party. No failure or other delay by
any party exercising any right, power, or privilege hereunder will be or operate
as a waiver thereof, nor will any single or partial exercise thereof preclude
any other or further exercise thereof or the exercise of any other right, power,
or privilege.
(g) This Agreement, together with the applicable Acquisition
Documents, contains the entire understanding and agreement among the parties,
and supersedes any prior understandings or agreements among them, or between or
among any of them, with respect to the subject matter hereof.
(h) This Agreement will be governed by and interpreted and
construed in accordance with the internal laws of The Commonwealth of
Massachusetts, as applied to contracts under seal made, and entirely to be
performed, within The Commonwealth of Massachusetts, and without reference to
principles of conflicts or choice of laws.
(i) This Agreement may not be amended, modified, or
supplemented except by a writing duly executed by all of the parties hereto.
(j) The provisions of this Agreement, including without
limitation the representations and warranties of the parties will be deemed
material, and, notwithstanding any investigation by or on behalf of any other
party, will be deemed to have been relied on by each other party, and will
survive the Closing and the consummation of the Acquisition and the other
transactions contemplated by the Acquisition Documents until terminated or no
longer in effect in accordance with their respective terms.
(k) This Agreement shall automatically terminate, without any
action on the part of any party hereto, upon the termination of the Acquisition
Agreement in the event that such termination occurs prior to the Closing
thereunder.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Shareholders' Agreement as an instrument under seal as of the date and year
first above written.
CUBIST PHARMACEUTICALS, INC.
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: President, CEO & Chairman
C&T ACQUISITION CORPORATION
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: President, CEO & Chairman
SHAREHOLDER COUNTERPART SIGNATURE PAGES FOLLOW
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxxxx Xxxxxxx
-------------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: President for MDS Ventures Pacific Inc.
Manager of: B.C. Life Sciences Limited
Partnership
Dated: August 5, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
CANADIAN MEDICAL DISCOVERIES
FUND INC.
By: /s/ Xxxxxxx Xxxxxxxxx
--------------------------
Name: Xxxxxxx Xxxxxxxxx
Dated: August 4, 2000
By: /s/ Xxxxxxx Xxxxxx
---------------------
Name: Xxxxxxx Xxxxxx
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President, S.R. One Limited
Dated: August 2, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxxx Xxxxx
-----------------------------------------
Name: Xxxxxx Xxxxx
Title: Investment Manager, Business
Development Bank of Canada
Dated: August 2, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ X.X. Xxxxxx
--------------------------------------
Name: X.X. Xxxxxx
Title: Director, 3i Asset Management Ltd.
Manager of 3i Bioscience
Investment Trust Plc
Dated: August 5, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
Technology Fund Plc Ltd
By: /s/ Xxxx Xxxx
---------------------------------------
Name: Xxxx Xxxx
Title: Director
Dated: August 1, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxxx Xxxxxx
-------------------------------------
Name: Xxxxxx Xxxxxx
Title: V.P. Research, CSO, TerraGen
Discovery, Inc.
Dated: August 3, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
Xenova Discovery Limited
By: /s/ Xxxxxx Xxxxxx
---------------------------------------
Name: Xxxxxx Xxxxxx
Title: Chief Financial Officer
Dated: August 5, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxx Xxxx
-----------------------------------
Name: Xxx Xxxx
Title:
Dated: August 5, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, qthe undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxx Xx Yap
------------------------------------
Name: Xxx Xx Xxx
Title:
Dated: August 5, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
qThe undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxx
Title:
Dated: September 29, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxx Xxx Xxxx
-----------------------------------
Name: Xxxx Xxx Xxxx
Title: Shareholder
Dated: September 27, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ X. Xxxxxxx
---------------------------------
Name: X. Xxxxxxx
Title: President
MDS Discovery Venture
Management Inc.
Dated: August 5, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxx XxXxxxx
------------------------------------
Name: Xxxxx XxXxxxx
Title:
Dated: August 5, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxx Xxxxxxxxxxx
---------------------------------
Name: Xxxxx Xxxxxxxxxxx
Title: Managing Director
University - Industry Liaison
Office
Dated: September 19, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxx Xxxxxx
-------------------------------------
Name: Xxxxx Xxxxxx
Title:
Dated: September 28, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxxx XxXxxxxx
-------------------------------------------
Name: Xxxxxx XxXxxxxx
Title:
Dated: September 20, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxxx Xxxx
---------------------------------------
Name: Xxxxxx Xxxx
Title:
Dated: September 27, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxx Xxxx
---------------------------------------
Name: Xxxxx Xxxx
Title: Finance Director
Dated: August 5, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Administrative Assistant
Dated: September 25, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxx Xx
------------------------------------
Name: Xxxxx Xx
Title:
Dated: August 5, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxx Xxx Mun Kun
------------------------------------
Name: Xxxx Xxx Xxx Xxx
Title: Director, IMCB Holdings
Dated: October 10, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
Xxxxx Investments Limited
By: /s/ Xxxxxxx Xxxx
-----------------------------
Name: Xxxxxxx Xxxx
Title: Operations Officer
Dated: October 11, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxxxxxxxx Xxxxxxxx
--------------------------------------
Name: Xxxxxxxxxxx Xxxxxxxx
Title:
Dated: August 5, 2000
SHAREHOLDER COUNTERPART SIGNATURE PAGE
The undersigned hereby agrees that, from and after the date
hereof, the undersigned has become a Shareholder party to the Shareholders'
Agreement, dated as of August 5, 2000, by and among Cubist Pharmaceuticals,
Inc., C&T Acquisition Corporation and each of the other Shareholder parties
thereto, and is entitled to all of the benefits under, and is subject to all of
the obligations, restrictions and limitations set forth in, the Shareholders'
Agreement that are applicable to the Shareholders (as such term is defined in
such Shareholders' Agreement).
By: /s/ Xxxxx Xx
---------------------------------------
Name: Xxxxx Xx
Title:
Dated: September 28, 2000
SCHEDULE 2(a)
SHAREHOLDERS(1)
Class B Convertible
Class A Common Preferred Promissory
Shareholder Shares Shares Options Note Warrants Total
------------------------------------------------------------------------------------------------------------------------------------
3I Bioscience Trust 2,311,558 2,311,558
Xxxxx Xxxxx 50,000 50,000
Xxxxxx Xxxxxxx 14,200 14,200
Xxxxxx Xxxx 3,000 3,000
Xxxx Xxxxxxx 1,000 1,000
Xxxxxxx Xxxxxxxxx 16,400 16,400
Xxxxxxx XxxXxxx 8,700 8,700
Xxxxxxx Xxxxxx 35,000 35,000
Biotechnology Investments Limited 1,349,964 178,125 1,528,089
Xxxxx Investments Ltd. 66,667 66,667
Xxxxx XxXxxxx 28,372 14,186 42,558
Business Development Bank of Canada 2,551,980 118,750 2,670,730
Canadian Medical Discoveries Fund
Inc. 200,000 5,866,906 130,625 6,197,533
Xxxxxxx Xxxxxxxx 25,000 25,000
Xxxxxxxxxxx Xxxxxxxx 7,000 7,300 14,300
Xxxxxxxxxxx Xxxxx 18,350 18,350
Xxxxxx Xxxxxx 10,200 10,200
Xxxxxx Xx 11,663 11,663
Xxxxxx Xxxxxx 28,370 25,000 14,184 67,554
Xxxxx Xxx 14,700 14,700
Xxxxx Xxxx 50,000 28,788 23,700 14,394 116,882
Xxxxxxx Xxxxxx 10,000 10,000
Xxxx Xxxxx 25,000 25,000
Xxxx Xxxxxxxxxx 12,500 12,500
Xxxxxx Xxxxxxxx 25,000 25,000
Xxxx Xxxxxxxxx 6,400 6,400
GATX/MM 1,068,750 1,068,750
Xxxxx Xxxxxx 20,000 2,700 22,700
Genhui Chen 12,163 12,163
Xxxxxxx Xxxxxxx 9,100 9,100
------------------
(1) As of August 5, 2000. The number of shares has been calculated as of the
Effective Time and assumes that the Conversion Rate (as defined in the
Company's Memorandum and Articles of Incorporation) of the Class B shares at
that time will be 1.425.
Class B Convertible
Class A Common Preferred Promissory
Shareholder Shares Shares Options Note Warrants Total
------------------------------------------------------------------------------------------------------------------------------------
Heinz Floss 25,000 25,000
Xxxxx Xxx 750 750
Xxxxx Xxxxxxxxx 8,700 8,700
IMCB Holdings Private Ltd. 1 1
Xxxxxxxxxx Xxxxxxxxxx 14,600 14,600
Jayvee &Co 157,545 157,545
Xxxxxx XxXxxxxxx 60,000 60,000
Xxxxx Xxxx 25,000 25,000
Xxxxx Xxxx 16,700 16,700
Xxxxxx X. Xxxxxx 250,000 116,300 366,300
Kah Xxxx Xxxx 20,000 20,000
Xxxxx Xx 5,000 5,000
Xxxxx Xxxxxxx 11,400 11,400
Xxxxx Xxxxxx 10,300 10,300
Xxxxxx Xxxxxxxx 43,700 43,700
Xxxxx Xxxxxx 10,200 10,200
Xxxxx Xxxxxx-Legal 19,650 19,650
Xxxxxx Xxxxxxx 12,400 12,400
MDS Discovery Venture
Management Inc. 300,000 300,000
MDS Ventures Pacific Inc. 1,190,261 1,190,261
Xxxxxxxx Xxxxx 14,600 14,600
Xxxx Xxxxx 36,500 36,500
Xxxx Xxxxxxx 10,500 10,500
Xxx Xxxxxxxx 25,000 25,000
Xxxxxx Xxxx 10,200 10,200
Xxxxxx How 1,000 1,000
Xxxxxxx Xxxxxx 2,000 6,600 8,600
S.R. One, Ltd. 3,966,328 344,375 4,310,703
Xxxxx Xxxxx 14,900 14,900
Xxxxxxx Sinneman 6,700 6,700
Xxxxxxx Xxxxxxx 88,800 88,800
Xxxxxxx Xxxxxxxx 6,300 6,300
Xxxxxx Xxxxxx 14,600 14,600
Xxxxxxx Xxx 750 750
Xxxxxxx Xxxxxxx 14,500 14,500
Xxxx Lysechko 7,600 7,600
Technology Fund Ltd. 1,437,499 243,058 1,680,557
Trega BioScience 855,000 855,000
Xxxxxx Xxxxxx 15,600 15,600
Tuck Xxx Xxxxx 8,000 8,000
University of BC 468,750 468,750
Xxxx Xxxx 1,000 1,000
Xxxxxx Xxxx 25,000 8,900 33,900
Wai-Ho Yap 20,000 20,000
Class B Convertible
Class A Common Preferred Promissory
Shareholder Shares Shares Options Note Warrants Total
------------------------------------------------------------------------------------------------------------------------------------
Wubin Pan 20,650 20,650
Xenova Discovery Ltd 1,425,000 2,875,000 4,300,000
Xxxxx Xx 12,750 6,400 19,150
Yangsheng Wanggui 6,000 6,000
Xxx Xxxx 1,000 1,000
Xxxxxx Xxxxx 3,000 3,000
