Exhibit 10.2

EXECUTION VERSION

 

SHARE PURCHASE AGREEMENT

 

by and among

 

INCYTE EUROPE S.à r.l.,

 

ARIAD PHARMACEUTICALS (CAYMAN) L.P.,

 

ARIAD PHARMACEUTICALS, INC. (AS GUARANTOR),

 

and

 

INCYTE CORPORATION (AS GUARANTOR)

 

 

 

May 9, 2016

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  

 

 

Table of Contents

 

    Page       Article 1 DEFINITIONS AND CONSTRUCTION 1       Section 1.1
Definitions 1       Section 1.2 Additional Defined Terms 9       Section 1.3
Construction 10       Article 2 THE TRANSACTION 10       Section 2.1 Sale and
Purchase of Shares 10       Section 2.2 Purchase Price 11       Section 2.3
Closing Date Adjustment 11       Section 2.4 Post-Closing Adjustment 11      
Section 2.5 Closing 14       Section 2.6 Closing Deliveries 14       Article 3
REPRESENTATIONS AND WARRANTIES OF THE SELLER 15       Section 3.1 Organization
and Good Standing 15       Section 3.2 Authority and Enforceability 15      
Section 3.3 No Conflict 16       Section 3.4 Capitalization and Ownership 16    
  Section 3.5 Brokers Fees 17       Section 3.6 Financial Statements 17      
Section 3.7 No Undisclosed Liabilities 17       Section 3.8 Absence of Certain
Changes and Events 18       Section 3.9 Tangible Personal Property 18      
Section 3.10 Leased Real Property 19       Section 3.11 Intellectual Property 19
      Section 3.12 Contracts 20       Section 3.13 Tax Matters 21       Section
3.14 Employee Benefit Matters 22       Section 3.15 Employment and Labor Matters
22       Section 3.16 Environmental, Health and Safety Matters 23       Section
3.17 Governmental Authorizations 23       Section 3.18 Compliance with Laws 24  
    Section 3.19 Product Liability 24       Section 3.20 Legal Proceedings 24

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  -i-

 

 

Table of Contents

(continued)

 

    Page       Section 3.21 Insurance 24       Section 3.22 Customers. 25      
Section 3.23 Interested Party Transactions 25       Section 3.24 Bank Accounts
25       Section 3.25 No Other Representations or Warranties 25       Article 4
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER 26       Section 4.1
Organization and Good Standing 26       Section 4.2 Authority and Enforceability
26       Section 4.3 No Conflict 26       Section 4.4 Legal Proceedings 26      
Section 4.5 Investment Intent 27       Section 4.6 Brokers Fees 27       Section
4.7 Financial Capacity 27       Section 4.8 Independent Investigation 27      
Article 5 PRE-CLOSING COVENANTS 27       Section 5.1 Access and Investigation;
Notice 27       Section 5.2 Operation of the Businesses of the Acquired
Companies 28       Section 5.3 Consents and Filings; Commercially Reasonable
Efforts 29       Section 5.4 Financing 30       Section 5.5 Public Announcements
30       Section 5.6 Intragroup Agreements 30       Section 5.7 Carve Out
Restructuring 30       Section 5.8 Financial Statements 30       Section 5.9 CSC
Guarantee 31       Article 6 CONDITIONS PRECEDENT TO OBLIGATION TO CLOSE 31    
  Section 6.1 Joint Condition 31       Section 6.2 Conditions to the Obligation
of the Purchaser 31       Section 6.3 Conditions to the Obligation of the Seller
32       Article 7 TERMINATION 32       Section 7.1 Termination Events 32      
Section 7.2 Effect of Termination 32

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  -ii-

 

 

Table of Contents

(continued)

 

    Page       Section 7.3 Certain Effects of Termination 33       Article 8
INDEMNIFICATION 33       Section 8.1 Indemnification by the Seller 33      
Section 8.2 Indemnification by the Purchaser 33       Section 8.3 Claim
Procedure 33       Section 8.4 Survival 34       Section 8.5 Limitations on
Liability 35       Section 8.6 Tax Refunds, Insurance Proceeds and Other
Payments 35       Section 8.7 Subrogation 36       Section 8.8 Exclusive Remed
36       Article 9 TAX MATTERS 36       Section 9.1 Swiss Tax Rulings 36      
Section 9.2 Liability and Indemnification for Taxes 37       Section 9.3 Tax
Return Filing; Audit Responsibilities 37       Section 9.4 Cooperation 38      
Section 9.5 No Code Section 338 Election 38       Section 9.6 Tax Treatment of
Indemnity Payments. 38       Article 10 EMPLOYEE MATTERS 39       Section 10.1
Employees 39       Section 10.2 Indemnity 39       Article 11 POST-CLOSING
COVENANTS 40       Section 11.1 Confidentiality 40       Section 11.2
Indemnification 40       Section 11.3 Seller’s Group Marks 40       Section 11.4
Standstill 41       Section 11.5 Further Actions 42       Section 11.6 Books and
Records and Cooperation with Litigation 42       Article 12 GENERAL PROVISIONS
42       Section 12.1 Notices 42       Section 12.2 Amendment 44       Section
12.3 Waiver and Remedies 44

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.  -iii-

 

 

Table of Contents

(continued)

 

    Page       Section 12.4 Entire Agreement 44       Section 12.5 Assignment,
Successors and No Third Party Rights 44       Section 12.6 Severability 44      
Section 12.7 Exhibits and Schedules 44       Section 12.8 Interpretation 45    
  Section 12.9 Expenses 45       Section 12.10 Governing Law 45       Section
12.11 Limitation on Liability 45       Section 12.12 Specific Performance 45    
  Section 12.13 Jurisdiction and Service of Process 45       Section 12.14
Waiver of Jury Trial 46       Section 12.15 No Joint Venture 46       Section
12.16 Non Recourse 46       Section 12.17 Guaranty 46       Section 12.18
Counterparts 46

 

Exhibits

 

Exhibit A       Amended and Restated Buy-In License Agreement Territory

Exhibit B       Territory

Exhibit C       Joint Press Release

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  -iv-

 

 

SHARE PURCHASE AGREEMENT

 

This Share Purchase Agreement (the “Agreement”) is made as of May 9, 2016, by
and among Incyte Europe S.à r.l., an entity formed under the laws of Switzerland
(the “Purchaser”), ARIAD Pharmaceuticals (Cayman) L.P., an Exempted Limited
Partnership registered in the Cayman Islands, acting by its general partner,
ARIAD Pharmaceuticals (Cayman) Inc., an Exempted Company incorporated in the
Cayman Islands with limited liability (the “Seller”), ARIAD Pharmaceuticals,
Inc., a Delaware corporation (“ARIAD US”), solely in its capacity as guarantor
under Section 13.17(a) hereof, and Incyte Corporation, a Delaware corporation
(“Incyte US”), for the purposes of Section 11.4 and in its capacity as guarantor
under Section 13.17(b).

 

WITNESSETH:

 

WHEREAS, the Seller owns all of the shares in the share capital of ARIAD
Pharmaceuticals (Luxembourg) S.à r.l., a private limited liability company
(société à responsabilité limitée) organized and existing under the laws of the
Grand Duchy of Luxembourg, with a share capital of USD 20,000, having its
registered office at 6, rue Eugène Ruppert, L-2453 Luxembourg and registered
with the Luxembourg Trade and Companies Register under number B 169.951 (the
“Company”);

 

WHEREAS, this Agreement contemplates the sale by the Seller to the Purchaser of
all of the share capital of the Company; and

 

WHEREAS, this Agreement is being executed in the presence of the Company.

 

NOW, THEREFORE, intending to be legally bound and in consideration of the mutual
provisions set forth in this Agreement and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:

 

Article 1
DEFINITIONS AND CONSTRUCTION

 

Section 1.1           Definitions.  For the purposes of this Agreement and the
Ancillary Agreements:

 

“Acquired Companies” means, collectively, the Company and its Subsidiaries.

 

“Affiliate” means, with respect to a specified Person, any other Person that
controls, is controlled by or is under common control with that Person. For the
purposes of this definition, the terms “controls”, “controlled by” and “under
common control with” as used with respect to any Person, means (i) to possess
(directly or indirectly) the power to direct the management or affairs of such
Person, whether through ownership of voting securities or other equity rights or
by contract relating to voting rights or corporate governance or otherwise, or
(ii) to own, directly or indirectly, more than fifty percent (50%) of the
outstanding voting securities or other ownership interest of such Person.

 

“Affiliated Group” means a group of corporations with which any Acquired Company
has filed consolidated, combined, unitary or similar Tax Returns.

 

“Amended and Restated Buy-In License Agreement” means the Amended and Restated
Buy-In License Agreement in the form attached as Exhibit A.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1

 

 

“Ancillary Agreements” means, collectively, the Amended and Restated Buy-In
License, the Interim Quality Agreement, the Marketing Authorization Services
Agreement, the Transition Services Agreement and the Reverse Transition Services
Agreement.

 

“Antitrust Approvals” means all authorizations, orders, grants, consents,
clearances, permissions and approvals and all expirations, lapses and
terminations of any required waiting periods (including extensions thereof), in
each case under any Antitrust Law, required to consummate the transactions
contemplated by this Agreement.

 

“ARIAD SWISSCO” means ARIAD Pharmaceuticals (Europe) S.a.r.l.

 

“ARIAD SWISSCO Intragroup Indebtedness” means any Indebtedness outstanding under
(i) the credit facility entered into between the Seller and ARIAD SWISSCO on
October 12, 2012; and (ii) the loan agreement entered into between ARIAD US and
ARIAD SWISSCO on August 7, 2012, in the case of each of (i) and (ii) as from
time to time supplemented, modified or amended.

 

“Australian Business” means the business carried on by ARIAD Pharmaceuticals
(Australia) Pty Ltd.

 

“Books and Records” means minutes books, stock books, stock ledgers, books of
account, manuals, general, financial, warranty and shipping records, invoices,
customer and supplier lists, correspondence, engineering, maintenance and
operating records and other documents, records and files, in each case
exclusively related to the business of the Acquired Companies.

 

“Business Day” means any day other than Saturday, Sunday or any day on which
banking institutions in the US or Switzerland are closed either under applicable
Law or action of any Governmental Authority. For the avoidance of doubt, any
other reference to days shall mean calendar days.

 

“Cash” means, with respect to a Person, the amount of cash, cash equivalents and
liquid investments on hand or credited to any account open in the name of such
Person with a financial institution (plus all uncollected bank deposits and less
all outstanding checks).

 

“Change” means a change, circumstance, condition, event, effect, development or
state of facts.

 

“Claims” means any charges, mortgages, pledges, security interests, escrows,
options, rights of first refusal, indentures, security agreements or other
encumbrances, claims, agreements, arrangements or commitments of any kind or
character and whether or not relating in any way to credit or the borrowing of
money.

 

“Closing Cash” means the Cash of the Acquired Companies on a consolidated basis
calculated as of 11:59 p.m., New York City time, on the date immediately
preceding the Closing Date in accordance with GAAP in a manner consistent with
the methods and practices used to prepare the Company Interim Balance Sheet
(with any amounts denominated in Foreign Currency converted to US Dollars using
the Exchange Rate).

 

“Closing Indebtedness” means the sum of (a) Indebtedness of the Acquired
Companies on a consolidated basis calculated as of 11:59 p.m., New York City
time, on the date immediately preceding the Closing Date, after giving effect to
the settlement of the ARIAD SWISSCO Intragroup Indebtedness, in accordance with
GAAP in a manner consistent with the methods and practices used to prepare the

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 2

 

 

Company Interim Balance Sheet plus (b) an amount equal to the aggregate
Retention Payments (with any amounts denominated in Foreign Currency converted
to US Dollars using the Exchange Rate).

 

“Closing Net Cash” means the difference between (a) the Closing Cash and (b) the
Closing Indebtedness. For purposes of this definition, if the Closing
Indebtedness exceeds the Closing Cash, then the Closing Net Cash amount will be
represented by a negative number.

 

“Closing Net Working Capital” means (a) all current assets of the Acquired
Companies (excluding Closing Cash and any assets relating to Taxes, including
assets that relate to the right to use Tax Attributes and any assets that relate
to a right to a tax refund or that otherwise results from the overpayment of
Taxes in any period) on a consolidated basis minus (b) all current liabilities
of the Acquired Companies (excluding the Deferred Revenue, Deferred Refund
Obligations and any Closing Indebtedness, to the extent made up of current
liabilities, and Liabilities relating to Taxes and as adjusted pursuant to
Section 5.8), in each case calculated as of 11:59 p.m., New York City time, on
the date immediately preceding the Closing Date in accordance with GAAP in a
manner consistent with the methods and practices used to prepare the Company
Interim Balance Sheet (with any amounts denominated in Foreign Currency
converted to US Dollars using the Exchange Rate). For purposes of this
definition, if the current Liabilities of the Acquired Companies on a
consolidated basis exceed the current assets of the Acquired Companies on a
consolidated basis, then the Closing Net Working Capital amount will be
represented by a negative number.

 

“Code” means the Internal Revenue Code of 1986, as amended, and the rules and
regulations promulgated thereunder.

 

“Commercialize” means all activities directed to importing (into, or within, the
Territory), exporting (within the Territory), storing, marketing, promoting,
selling, offering for sale and distributing the Product in the Territory.
“Commercializes,” “Commercialized,” “Commercialization” and other forms of the
word “Commercialize” shall have the correlative meaning. For clarity,
“Commercialize” excludes manufacture.

 

“Company Plan” means any “employee benefit plan” (as defined in Section 3(3) of
ERISA), any Pension Arrangement and any other material plan, Contract or
arrangement involving direct or indirect compensation, including insurance
coverage, severance benefits, ill health, disability, deferred compensation,
bonuses, stock options, stock purchase, phantom stock, stock appreciation or
other forms of incentive compensation or post-retirement compensation sponsored
or maintained by any Acquired Company or the Seller for the benefit of any
current or former director, officer or Transferred Employee of any Acquired
Company.

 

“Compound” has the meaning given to that term in the Amended and Restated Buy-In
License Agreement.

 

“Contract” means any written contract, agreement, lease, license, commitment,
understanding, franchise, warranty, guaranty, mortgage, note, bond or other
instrument or consensual obligation that is legally binding.

 

“Controlled Person” means Incyte US, its direct and indirect Subsidiaries [***].

 

“CSC Guarantee” means that certain guarantee provided by ARIAD US for the
benefit of CSC Pharmaceuticals Handels GmbH (“CSC”) to guarantee the performance
of the obligations of ARIAD

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 3

 

 

SWISSCO under the Market Access Services and Distribution and Supply Agreement
between ARIAD SWISSCO and CSC.

 

“Deferred Revenue” means the amounts recorded in other current liabilities in
the Financial Statements attributable to the matter described in Section 3.7 of
the Seller Disclosure Schedule.

 

“Deferred Refund Obligations” means the aggregate amount of the refunds payable
to the applicable Governmental Authority relating to the Deferred Revenue and
described in Section 3.7 of the Seller Disclosure Schedule.

 

“Encumbrance” means any charge, mortgage, encumbrance, pledge, security
interest, or other lien other than (a) carrier’s, warehousemen’s, mechanic’s,
materialmen’s and other similar liens with respect to amounts that are not yet
due and payable or that are being contested in good faith, (b) liens for Taxes
that are not yet due and payable or that are being contested in good faith, (c)
liens securing rental payments under capital lease arrangements, (d)
restrictions arising under applicable zoning and other land use Laws that do
not, individually or in the aggregate, have a material adverse effect on the
present use or occupancy of the property subject thereto.

 

“Environmental Law” means any Law concerning (a) the treatment, disposal,
emission, discharge, Release or threatened Release of Hazardous Material or (b)
the protection of the environment (including natural resources, air and surface
or subsurface land or waters).

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
and the rules and regulations promulgated thereunder.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

“Exchange Rate” means the exchange rate between the applicable Foreign Currency
and US Dollars observed by Bloomberg at 9:00 a.m., New York City time, three
Business Days prior to the Closing Date.

 

“Foreign Currency” means any currency other than US Dollars.

 

“GAAP”, unless otherwise stated, means United States generally accepted
accounting principles.

 

“Governmental Authority” means any (a) nation, region, state, county, city,
town, village, district or other jurisdiction, (b) federal, state, local,
municipal, foreign or other government, (c) governmental or quasi-governmental
authority of any nature (including any governmental agency, branch, department
or other entity and any court or other tribunal), (d) multinational organization
exercising judicial, legislative or regulatory power or (e) body exercising, or
entitled to exercise, any administrative, executive, judicial, legislative,
police, regulatory or taxing authority or power of any nature of any federal,
state, local, municipal, foreign or other government.

 

“Governmental Authorization” means any approval, consent, ratification, waiver,
license, permit, registration or other authorization issued or granted by any
Governmental Authority.

 

“Hazardous Material” means any waste or other substance that is listed, defined,
designated or classified as hazardous, radioactive or toxic or a pollutant or a
contaminant under any Environmental Law, including any admixture or solution
thereof, and including petroleum and all derivatives thereof or synthetic
substitutes therefor, asbestos or asbestos-containing materials in any form or
condition and polychlorinated biphenyls.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 4

 

 

“Indebtedness” means, with respect to any Person (a) all indebtedness of such
Person, whether or not contingent, for borrowed money, (b) all obligations of
such Person evidenced by notes, bonds, debentures or other similar instruments
or debt securities and warrants or other rights to acquire any such instruments
or securities and (c) all indebtedness of others referred to in clauses (a) and
(b) hereof guaranteed, directly or indirectly, in any manner by such Person, or
in effect guaranteed directly or indirectly by such Person through an agreement
(i) to pay or purchase such Indebtedness or to advance or supply funds for the
payment or purchase of such Indebtedness, (ii) to purchase, sell or lease (as
lessee or lessor) property, or to purchase or sell services, primarily for the
purpose of enabling the debtor to make payment of such Indebtedness or to assure
the holder of such Indebtedness against Loss, (iii) to supply funds to or in any
other manner invest in the debtor (including any agreement to pay for property
or services irrespective of whether such property is received or such services
are rendered), (iv) to grant an Encumbrance on property owned or acquired by
such Person, whether or not the obligation secured thereby has been assumed or
(v) otherwise to assure a creditor against Loss, except in the case of any of
items (a), (b) or (c) to the extent solely between or among the Acquired
Companies.

 

“Intellectual Property” means all (a) patents (including utility and design
patents), patent applications, Patent Cooperation Treaty filings, patent
disclosures and all related extensions, continuations, continuations-in-part,
divisions, reissues, and reexaminations, utility models, certificates of
invention and design patents, and all extensions thereto, (b) trademarks,
service marks, trade dress, brand names, certification marks, logos, slogans,
rights in designs, industrial designs, corporate names, trade names, business
names, together with the goodwill associated with any of the foregoing, in each
case whether registered or unregistered, and all applications and registrations
therefor (“Trademarks”), (c) domain names, URLs and any other addresses for use
on the Internet, (d) copyrights and registrations and applications therefor,
together with all renewals, extensions, translations, adaptations, derivations
and combinations therefor, works of authorship, publications, documentation,
website content, rights in fonts and typefaces, and database rights, (e) rights
of publicity, rights of privacy, royal warrants and moral rights, (f) know-how,
trade secrets, confidential and proprietary information, rights in research and
development, financial, marketing and business data, pricing and cost
information, plans (including business and marketing plans), formulae,
inventions, processes, techniques, technical data, designs, drawings (including
engineering and auto-cad drawings), specifications, databases, blue prints, and
customer and supplier lists and information, in each case whether patentable or
not and whether or not reduced to practice, (g) other intellectual property or
similar corresponding or equivalent right to any of the foregoing or other
proprietary or Contract right relating to any of the foregoing (including
remedies against infringements thereof and rights of protection of interest
therein under the laws of all jurisdictions) and (h) copies and tangible
embodiments thereof, in each case whether or not the same are in existence as of
the date of this Agreement or developed after such date and in any jurisdiction
throughout the world.

 

“Interim Quality Agreement” means a quality agreement in the form reasonably
acceptable to the parties to this Agreement.

 

“Intragroup Agreement” means a Contract between or among any member of the
Seller’s Group, on the one hand, and any Acquired Company, on the other hand,
but excluding any Ancillary Agreement.

 

“Judgment” means any order, injunction, judgment, decree, ruling, assessment or
arbitration award of any Governmental Authority or arbitrator or other court or
tribunal.

 

“Knowledge” means the actual knowledge of any of each Person listed in Section
1.1(a) of the Seller Disclosure Schedule, after such inquiry as such Persons
normally would conduct in the ordinary course of their duties to Seller and its
Affiliates.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 5

 

 

“Law” means any federal, state, local, municipal, foreign, international,
multinational, or other constitution, law, statute, treaty, rule, regulation,
ordinance or code.

 

“Liability” means any liability or obligation, whether known or unknown,
absolute or contingent, accrued or unaccrued, liquidated or unliquidated, due or
to become due.

 

“Loss” means any direct and actual Liabilities, losses, damages, penalties,
fines, costs or expenses (including reasonable attorney’s or other professional
fees and expenses), but excluding any special, incidental indirect, exemplary,
punitive or consequential damages, lost profits, loss of revenue, lost sales, or
amounts calculated as a multiple of earnings, profits, revenue, sales or other
measures; provided, that the foregoing exclusions shall not limit the rights any
party to indemnity for such damages to the extent actually paid to Persons other
than the parties hereto, any Indemnified Party or their respective Affiliates.

 

“Marketing Authorization Services Agreement” means a marketing authorization
services agreement in the form reasonably acceptable to the parties to this
Agreement.

 

“Material Adverse Effect” means any Change that has a material adverse effect on
(a) the business, assets (whether tangible or intangible), liabilities,
financial condition, operations or results of operations of the Acquired
Companies, taken as a whole, or (b) the ability of the Seller to consummate
timely the transactions contemplated by this Agreement; provided that none of
the following shall be deemed, either alone or in combination, to constitute,
and none of the following shall be taken into account in determining whether
there has been, a Material Adverse Effect: (i) any Change generally affecting
economic, regulatory or political conditions, (ii) any Change generally
affecting the financial, credit, securities or other capital markets in the
United States or any foreign jurisdiction, (iii) any Change generally affecting
the industry in which the Acquired Companies operate, (iv) any hurricane,
tornado, flood, earthquake, tsunami, volcanic eruption or other natural
disaster, (v) any Change occurring in national or international political
conditions, including acts of war, sabotage or terrorism, or any escalation or
worsening of any such acts of war, sabotage or terrorism, (vi) any Change
occurring after the date of this Agreement in applicable Law or generally
accepted accounting principles, (vii) the public announcement of the execution
of this Agreement and (viii) any failure to meet any internal or published
projections, forecasts or revenue or earnings predictions for any period ending
on or after the date of this Agreement (but not the facts or circumstances
underlying or giving rise to such failure), except, with respect to the
foregoing clauses (i) through (vi), to the extent that the effects of any such
matter are, or would reasonably be expected to be, disproportionately adverse to
the business, financial condition, operations or results of operations of the
Acquired Companies, taken as a whole, as compared to other companies operating
in the industries and markets in which the Acquired Companies operate.

 

“Marketing Authorization” means a marketing authorization (or equivalent product
approval in any country within the Territory) issued by a Governmental Authority
with respect to the Product to enable the Product to be placed on the market in
a country in the Territory.

 

“Organizational Documents” means, with respect to any entity, the certificate of
incorporation or formation, the articles of incorporation, by-laws, articles of
organization, partnership agreement, limited liability company agreement,
formation agreement, joint venture agreement or other similar organizational
documents of such entity (in each case, as amended).

 

“Pension Arrangement” means any pension plan disclosed at Section 3.14(a) of the
Seller Disclosure Schedule.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 6

 

 

“Person” means an individual or an entity, including a (for profit or not for
profit) corporation, limited liability company, general or limited partnership,
trust, association or other business or investment entity, academic institution,
research institution, or any Governmental Authority.

 

“Post-Closing Period” means any taxable period or portion of a period that
begins after the Closing Date.

 

“Pre-Closing Period” means any taxable period or portion of a period that begins
on or before the Closing Date and ends on or before the Closing Date.

 

“Pre-Sale Restructuring” means: (i) the financial restructuring of ARIAD SWISSCO
for the purposes of settling the ARIAD SWISSCO Intragroup Indebtedness; (ii)
ARIAD SWISSCO entering into the Amended and Restated Buy-In License Agreement;
and (iii) any transaction or arrangement required for the implementation of the
transactions in (i) and (ii).

 

“Proceeding” means any action, arbitration, audit, examination, investigation,
hearing, litigation or suit (whether civil, criminal, administrative, judicial
or investigative, whether formal or informal, and whether public or private)
commenced, brought, conducted or heard by or before, or otherwise involving, any
Governmental Authority or arbitrator.

 

“Product” means any pharmaceutical product containing Compound as an active
chemical entity, alone or in combination with one or more other active
ingredients, in any and all forms, presentations, dosages, and formulations.

 

“Registrations” means (a) Marketing Authorizations, (b) receipt of any license
issued by a Governmental Authority required to import Product(s) into each
country in the Territory, and (c) any other license issued by a Governmental
Authority or approval which is legally required to Commercialize the Product in
each country of the Territory (e.g., wholesale licenses).

 

“Regulatory Authority” means the European Medicines Agency or any other
Governmental Authority that is a competent authority for the issuance of any of
the Registrations, or any part of them, in any country of the Territory.

 

“Release” means the release, spill, emission, leaking, pumping, pouring,
emptying, escaping, dumping, injection, deposit, disposal, discharge, dispersal,
leaching or migrating of any Hazardous Material into the environment.

 

“Representatives” means, with respect to a Person, the directors, managers,
officers, employees, agents or advisors (including attorneys, accountants,
consultants, bankers and financial advisors) of such Person.

 

“Required Contracts” means the Contracts listed at Section 1.1(b) of the Seller
Disclosure Schedule.

 

“Retention Payments” means the payments listed at Section 1.1(c) of the Seller
Disclosure Schedule.

 

“Reverse Transition Services Agreement” means a reverse transition services
agreement in the form reasonably acceptable to the parties to this Agreement.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 7

 

 

“Schedule” means the Seller Disclosure Schedule or the Purchaser Disclosure
Schedule, as the context requires.

 

“SEC” means the U.S. Securities and Exchange Commission.

 

“Seller Fundamental Representations” means those representations and warranties
of the Seller set out in Section 3.1(a), Section 3.1(b), Section 3.2, Section
3.4(a), Section 3.4(b) and Section 3.5.

 

“Seller’s Group” means the Seller and its Affiliates, but excluding the Acquired
Companies.

 

“Seller’s Group Marks” means any marks or logos that contain Seller’s name
“ARIAD,” including but not limited to, ARIAD, ARIAD PASS, and ARIAD
PHARMACEUTICALS and ARIAD with Spiral Design.

 

“Shares” means all of the issued and outstanding share capital of the Company.

 

“Straddle Period” means any taxable period that begins before and ends after the
Closing Date.

 

“Subsidiary” means, with respect to a specified Person, any corporation or other
Person of which securities or other interests having the power to elect a
majority of that corporation’s or other Person’s board of directors or similar
governing body, or otherwise having the power to direct the business and
policies of that corporation or other Person (other than securities or other
interests having such power only upon the happening of a contingency that has
not occurred) are held by the specified Person or one or more of its
Subsidiaries. When used in this Agreement without reference to a particular
Person, “Subsidiary” means a Subsidiary of the Company.

 

“Swiss Tax Authorities” means any taxing or other authority competent to impose
any liability in respect of Tax or responsible for the administration and/or
collection of Tax or enforcement of any law in relation to Tax in Switzerland.

 

“Tax” means (a) any federal, state, local, foreign or other tax, charge, fee,
duty (including customs duty), levy or assessment, including any income, gross
receipts, net proceeds, alternative or add-on minimum, corporation, ad valorem,
turnover, real property, personal property (tangible or intangible), sales, use,
franchise, excise, value added, stamp, leasing, lease, user, transfer, fuel,
excess profits, profits, occupational, premium, interest equalization, windfall
profits, severance, license, registration, payroll, environmental, capital
stock, capital duty, disability, estimated, gains, wealth, welfare, employee’s
income withholding, other withholding, unemployment or social security or other
tax of whatever kind (including any fee, assessment or other charges in the
nature of or in lieu of any tax) that is imposed by any Governmental Authority,
(b) any interest, fines, penalties or additions resulting from, attributable to,
or incurred in connection with any items described in this paragraph or any
related contest or dispute and (c) any Liability for the Taxes of another
Person.

 

“Tax Attributes” means any net operating loss, net capital loss, investment tax
credit, foreign credit, charitable deduction or any other credit or tax
attribute that could be carried forward or back to reduce Taxes (including
deductions and credits relating to alternative minimum Taxes), and any
additional items described in Section 381 of the Code without reference to the
conditions and limitations described therein.

 

“Tax Contest” means an audit, claim, dispute or controversy relating to Taxes.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 8

 

 

“Tax Return” means any report, return, declaration, claim for refund, notice, or
information return or statement related to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.

 

“Territory” means the area within the geographic boundaries as set forth in
Exhibit B.

 

“Third Party” means any Person other than Seller and Purchaser and their
respective Affiliates.

 

“Transition Services Agreement” means a transition services agreement in the
form reasonably acceptable to the parties to this Agreement.

 

“US Dollars” means the lawful currency of the United States as at the date of
this Agreement.

 

Section 1.2           Additional Defined Terms.  For purposes of this Agreement,
the following terms have the meanings specified in the indicated Section of this
Agreement:

 

Defined Term   Section Adjustment Calculation   Section 2.4(a) Adjustment Notice
  Section 2.4(a) Affiliate Indemnified Party   Section 12.2 Agreement   Preamble
Antitrust Laws   Section 5.3(b) ARIAD SWISSCO Balance Sheet   Section 3.6(a)(i)
ARIAD US   Preamble Audited Consolidated Balance Sheets   Section 5.8 Audited
Consolidated Financial Statements   Section 5.8 Carve Out Restructuring  
Section 5.7 Claim Notice   Section 8.3(a) Closing   Section 2.5 Closing Balance
Sheet   Section 2.4(a) Closing Date   Section 2.5 Closing Date Payment   Section
2.2 Closing Net Cash Statement   Section 2.4(a) Closing Net Working Capital
Statement   Section 2.4(a) Company   Preamble Company Balance Sheet   Section
3.6(a)(ii) Company Information   Section 12.1(b) Company Intellectual Property  
Section 3.11(a) Company Interim Balance Sheet   Section 3.6(a)(iii)
Confidentiality Agreement   Section 12.1(a) Continuation Period   Section
10.1(a) Controlling Party   Section 8.3(d) Dispute Notice   Section 2.4(c)(ii)
Estimated Closing Net Cash   Section 2.3(a) Estimated Closing Net Working
Capital   Section 2.3(b) FCPA   Section 3.18 Final Closing Net Cash   Section
2.4(f) Final Closing Net Working Capital   Section 2.4(f) Financial Statements  
Section 3.6(a) Indemnified Party   Section 8.3(a)

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 9

 

 

Indemnifying Party   Section 8.3(a) Independent Accounting Firm   Section 2.4(e)
Initial Purchase Price   Section 2.2 Leased Real Property   Section 3.10(a)
Material Contracts   Section 3.12(a) Material Customers   Section 3.22(a)
Non-controlling Party   Section 8.3(d) Other Consolidated Financial Statements  
Section 5.8 Purchase Price   Section 2.2 Purchaser   Preamble Purchaser
Indemnified Parties   Section 8.1 Real Property Leases   Section 3.10(a)
Resolution Period   Section 2.4(e) Seller   Preamble Seller Disclosure Schedule
  Article 3 Seller Indemnified Parties   Section 8.2 Subsidiary Shares   Section
3.4(b) Swiss Tax Rulings   Section 9.1(a) Third Party Claim   Section 8.3(b)
Transferred Employees   Section 10.1(a) Transferred Former Employees   Section
10.1(a) Warranted Leased Real Property   Section 3.10(b)

 

Section 1.3           Construction. The language in all parts of this Agreement
will be construed, in all cases, according to its fair meaning. Any reference in
this Agreement to an “Article,” “Section,” “Exhibit” or “Schedule” refers to the
corresponding Article, Section, Exhibit or Schedule of or to this Agreement,
unless the context indicates otherwise. The table of contents and the headings
of Articles and Sections are provided for convenience only and are not intended
to affect the construction or interpretation of this Agreement. All words used
in this Agreement are to be construed to be of such gender or number as the
circumstances require. The words “including,” “includes,” or “include” are to be
read as listing non-exclusive examples of the matters referred to, whether or
not words such as “without limitation” or “but not limited to” are used in each
instance. The word “extent” in the phrase “to the extent” means the degree to
which a subject or other thing extends, and such phrase will not mean simply
“if”. Where this Agreement states that a party “shall”, “will” or “must” perform
in some manner or otherwise act or omit to act, it means that the party is
legally obligated to do so in accordance with this Agreement. Any reference to a
statute is deemed also to refer to any amendments or successor legislation as in
effect at the relevant time. Unless otherwise stated, all references to any
agreements will be deemed to include the Exhibits, schedules and annexes to such
agreement. Any reference to a Contract or other document as of a given date
means the Contract or other document as amended, supplemented and modified from
time to time through such date.

 

Article 2
THE TRANSACTION

 

Section 2.1           Sale and Purchase of Shares. In accordance with the
provisions of this Agreement, at the Closing, the Seller will sell and transfer
to the Purchaser, and the Purchaser will purchase and acquire from the Seller,
all of the Shares, free and clear of all Claims (other than any restrictions on
transferability imposed by applicable securities Laws).

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 10

 

 

Section 2.2           Purchase Price. Subject to the terms and conditions of
this Agreement, at the Closing, in consideration for the sale of the Shares, the
Purchaser will pay to the Seller an aggregate amount in cash equal to US Dollars
140,000,000 (the “Initial Purchase Price”), as adjusted pursuant to Section 2.3
(the “Closing Date Payment”). The Closing Date Payment is subject to adjustment
following the Closing pursuant to Section 2.4. The Initial Purchase Price as
adjusted pursuant to Section 2.3 and Section 2.4(f) will be the “Purchase
Price”.

 

Section 2.3           Closing Date Adjustment.

 

(a)          Estimated Closing Net Cash. No later than two Business Days prior
to the Closing Date, the Seller will provide to the Purchaser an estimate of the
Closing Net Cash (such estimate, the “Estimated Closing Net Cash”). To the
extent the Estimated Closing Net Cash is positive (i.e., the Closing Cash
exceeds the Closing Indebtedness), the Purchaser will add the absolute value of
such amount to the Initial Purchase Price paid at the Closing. To the extent the
Estimated Closing Net Cash is negative (i.e., the Closing Indebtedness exceeds
the Closing Cash), the Purchaser will deduct the absolute value of such amount
from the Initial Purchase Price paid at the Closing.

 

(b)          Estimated Closing Net Working Capital. No later than two Business
Days prior to the Closing Date, the Seller will provide to the Purchaser an
estimate of the Closing Net Working Capital (the “Estimated Closing Net Working
Capital”). If the Estimated Closing Net Working Capital is greater than zero,
the Purchaser will add the absolute value of the excess to the Initial Purchase
Price paid at the Closing. If the Estimated Closing Net Working Capital is less
than zero, the Purchaser will deduct the absolute value of the shortfall from
the Initial Purchase Price paid at the Closing.

 

Section 2.4           Post-Closing Adjustment.

 

(a)          Within 45 days after the Closing Date, the Purchaser will prepare
and deliver to the Seller a written notice (the “Adjustment Notice”) containing
(i) an unaudited consolidated balance sheet of the Acquired Companies as at
immediately prior to the Closing (the “Closing Balance Sheet”), (ii) the
Purchaser’s calculation of the Closing Net Working Capital based on the Closing
Balance Sheet (the “Closing Net Working Capital Statement”), (iii) the
Purchaser’s calculation of Closing Net Cash based on the Closing Balance Sheet
(the “Closing Net Cash Statement”) and (iv) the Purchaser’s calculation of the
amount of any payments required pursuant to Section 2.4(g) (the “Adjustment
Calculation”). The Closing Balance Sheet, the Closing Net Working Capital
Statement and the Closing Net Cash Statement will be prepared in accordance with
GAAP applied in a manner consistent with the methods and practices used to
prepare the Company Interim Balance Sheet.

 

(b)          During the preparation of the Adjustment Notice, at the Purchaser’s
request, the Seller will, and will cause each of the Acquired Companies to, (i)
provide the Purchaser and the Purchaser’s Representatives with reasonable access
to the books, records, facilities and Employees of the Acquired Companies to the
extent not otherwise already acquired as of the Closing Date, (ii) provide the
Purchaser, within ten Business Days after the Closing Date, with normal
month-end closing financial information for the period ending as of the close of
business on the Closing Date and (iii) reasonably cooperate with the Purchaser
and the Purchaser’s Representatives, including by providing on a timely basis
all information reasonably necessary or useful in preparing the Adjustment
Notice and any other information reasonably requested by the Purchaser.
Following delivery of the Adjustment Notice, at the Seller’s request, the
Purchaser (i) shall reasonably cooperate and assist, and shall cause its
Representatives to assist, the Seller and its Representatives in the review of
the Adjustment Notice and (ii) shall provide the Seller and its Representatives
with any information reasonably requested by them.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 11

 

 

(c)          Within 30 days after delivery of the Adjustment Notice, the Seller
will either:

 

(i)          agree in writing with the Adjustment Calculation, in which case
such calculation will be final and binding on the parties for purposes of
Section 2.4(g); or

 

(ii)         dispute the Adjustment Calculation by delivering to the Purchaser a
written notice (a “Dispute Notice”) which shall specify which items are being
disputed and set forth in reasonable detail the basis for each disputed item
therein.

 

(d)          If the Seller fails to take either of the foregoing actions within
30 days after delivery of the Adjustment Notice, then the Seller will be deemed
to have irrevocably accepted the Adjustment Calculation, in which case, the
Adjustment Calculation will be final and binding on the parties for purposes of
Section 2.4(g).

 

(e)          If the Seller timely delivers a Dispute Notice to the Purchaser,
then the Purchaser and the Seller will attempt in good faith, for a period of 30
days following the Purchaser’s receipt of such Dispute Notice (the “Resolution
Period”), to agree on the Adjustment Calculation for purposes of Section 2.4(g).
Any resolution by the Purchaser and the Seller memorialized in writing and
signed by both the Purchaser and the Seller during the Resolution Period as to
any disputed items set forth in such Dispute Notice will be final and binding on
the parties for purposes of Section 2.4(g). If the Purchaser and the Seller do
not resolve all disputed items by the end of the Resolution Period, then the
Purchaser and the Seller will submit the remaining items in dispute to
PricewaterhouseCoopers LLP for resolution, or if that firm is unwilling or
unable to serve, the Purchaser and the Seller will engage another mutually
agreeable independent accounting firm of recognized international standing,
which firm is not the regular auditing firm of the Purchaser or the Acquired
Companies. If the Purchaser and the Seller are unable to jointly select such
independent accounting firm within 10 days after the Resolution Period, the
Purchaser, on the one hand, and the Seller, on the other hand, will each select
an independent accounting firm of recognized international standing and such
selected accounting firms will select a third independent accounting firm of
recognized international standing, which firm is not the regular auditing firm
of the Purchaser or the Acquired Companies; provided, however, that if either
the Purchaser, on the one hand, or the Seller, on the other hand, fails to
select such independent accounting firm during this 10-day period, then the
parties agree that the independent accounting firm selected by the other party
will be the independent accounting firm selected by the parties for purposes of
this Section 2.4 (such selected independent accounting firm, whether pursuant to
this sentence or the preceding sentence, the “Independent Accounting Firm”).

 

(i)          The Independent Accounting Firm will (A) act as an expert in
accounting, and not as an arbitrator, to resolve only those items specifically
set forth on a timely delivered Dispute Notice that remain in dispute as of such
time, and that have not been deemed pursuant to Section 2.4(c), Section 2.4(d)
or Section 2.4(e) to be final and binding on the Parties, (B) render its
determination in accordance with this Agreement and otherwise in accordance with
GAAP applied in a manner consistent with the methods and practices used to
prepare the Company Interim Balance Sheet, (C) not determine an Adjustment
Calculation that would result in a Purchase Price (1) in excess of the
applicable amount in the Adjustment Notice or (2) that is less than the
applicable amount in the Dispute Notice and (D) render its determination with
respect to the items in dispute in a written report that specifies the
conclusions of the Independent Accounting Firm as to each item in dispute and
the resulting Adjustment Calculation. The Independent Accounting Firm will only
render its determination with respect to the specific remaining accounting
differences submitted to it and may rely only upon information submitted to it
by or on behalf of the Purchaser or the Seller. The Purchaser and the Seller
will each use their commercially reasonable efforts to cause the Independent
Accounting Firm to render its

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 12

 

 

determination within 30 days after referral of the disputed items on a timely
delivered Dispute Notice to such firm or as soon thereafter as reasonably
practicable. The decision of the Independent Accounting Firm will be final,
conclusive and binding on the Parties and will not be subject to appeal or
further review. The costs and expenses of the Independent Accounting Firm will
be allocated between the Parties based upon the percentage which the portion of
the contested amount not awarded to each party bears to the amount actually
contested by such party, as determined by the Independent Accounting Firm. The
Buyer and the Representative agree to execute, if requested by the Independent
Accounting Firm, a reasonable engagement letter, including customary indemnities
in favor of the Independent Accounting Firm.

 

(ii)         For purposes of complying with this Section 2.4, the Purchaser and
the Seller will furnish to the Independent Accounting Firm such work papers and
other documents and information relating to the disputed items on a timely
delivered Dispute Notice as the Independent Accounting Firm may reasonably
request and are available to that party (or its Representatives). A copy of any
such work papers and other documents and information provided by a party to the
Independent Accounting Firm will be provided concurrently to the other party
free of charge. Each party will be afforded the opportunity to present to the
Independent Accounting Firm any material related to the disputed items on a
timely delivered Dispute Notice and to discuss such items with the Independent
Accounting Firm, with any such presentation or discussion to be held in the
presence of both the Purchaser and the Seller and/or their respective
Representatives.

 

Notwithstanding anything herein to the contrary, the dispute resolution
mechanism contained in this Section 2.4(e) will be the exclusive mechanism for
resolving any disputes regarding the Adjustment Calculation.

 

(f)          The “Final Closing Net Working Capital” will be the calculation of
the Closing Net Working Capital contained in the Closing Net Working Capital
Statement, as adjusted pursuant to the mutual agreement of the Seller and the
Purchaser, or as adjusted by the Independent Accounting Firm, in each case,
pursuant to Section 2.4(e), together with any other modifications to the Closing
Net Working Capital Statement mutually agreed upon by the Seller and the
Purchaser. The “Final Closing Net Cash” will be the calculation of the Closing
Net Cash contained in the Closing Net Cash Statement, as adjusted pursuant to
the mutual agreement of the Seller and the Purchaser, or as adjusted by the
Independent Accounting Firm, in each case, pursuant to Section 2.4(e), together
with any other modifications to the Closing Net Cash Statement mutually agreed
upon by the Seller and Purchaser.

 

(g)          If the Final Closing Net Working Capital is less than the Estimated
Closing Net Working Capital, then the Seller will pay to the Purchaser the
absolute value of such difference in cash in accordance with Section 2.4(h). If
the Final Closing Net Working Capital is greater than the Estimated Closing Net
Working Capital, then the Purchaser will pay to the Seller the absolute value of
such difference in cash in accordance with Section 2.4(h). If the Final Closing
Net Cash is less than the Estimated Closing Net Cash, then the Seller will pay
to the Purchaser the absolute value of such difference in cash in accordance
with Section 2.4(h). If the Final Closing Net Cash is greater than the Estimated
Closing Net Cash, then the Purchaser will pay to the Seller the absolute value
of such difference in accordance with Section 2.4(h).

 

(h)          Any amounts due and payable by one party to the other pursuant to
Section 2.4(g) will be paid to the applicable party by means of a wire transfer
of immediately available funds in US Dollars within three Business Days after
the determination of the Final Closing Net Working Capital and the Final Closing
Net Cash, as applicable, pursuant to Section 2.4(f).

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 13

 

 

(i)          Notwithstanding anything to the contrary set forth in this
Agreement, in no event will the Seller be obligated to indemnify any Purchaser
Indemnified Party for any Loss as a result of, based upon or arising from, any
Liability to the extent such Liability is reflected in the calculation of the
Final Closing Net Working Capital or the Final Closing Net Cash as determined
pursuant to Section 2.4(f). Any payment made pursuant to this Section 2.4 will
be treated by the Parties for all purposes as an adjustment to the Initial
Purchase Price and will not be subject to offset for any reason.

 

Section 2.5           Closing. The closing of the transactions contemplated by
this Agreement (the “Closing”) will take place at the offices of Baker &
McKenzie LLP, 300 East Randolph Street, Suite 5000, Chicago, Illinois, 60601, at
10:00 a.m., local time, as soon as practicable, but in any event not later than
the third Business Day immediately following the date on which the last of the
conditions set forth in Article 6 has been satisfied or waived (other than those
conditions that by their nature can only be satisfied at the Closing), or at
such other time and place as the Seller and the Purchaser may agree in writing;
provided, however, that in no event with the Closing occur prior to June 1,
2016. The date on which the Closing actually occurs is referred to in this
Agreement as the “Closing Date.”

 

Section 2.6           Closing Deliveries.

 

(a)          At the Closing, the Seller will deliver or cause to be delivered to
the Purchaser:

 

(i)          written resolutions or copies of the minutes of the meeting of the
Board of Directors of each of the Company and the Seller approving the transfer
of the Shares;

 

(ii)         a certificate or certificates representing the Shares, duly
endorsed or accompanied by a stock power duly endorsed in blank and with all
required stock transfer tax stamps affixed, together with such other documents
and instruments necessary to vest in the Purchaser all of the Seller’s right,
title and interest in and to the Shares;

 

(iii)        a short form acceptance letter signed by the Company approving the
transfer of its shares;

 

(iv)        a certificate, dated as of the Closing Date, executed by the Seller
confirming the satisfaction of the conditions specified in Section 6.2(a) and
Section 6.2(b);

 

(v)         the Ancillary Agreements to which the Seller or its Affiliates are a
party, duly executed by the Seller or the applicable Affiliate of the Seller;
and

 

(vi)        resignations effective as of the Closing Date of each director and
officer of each Acquired Company as the Purchaser may have requested in writing
within ten (10) Business Days prior to the Closing Date.

 

(b)          At the Closing, the Purchaser will deliver or cause to be delivered
to the Seller:

 

(i)          the Closing Date Payment by wire transfer of immediately available
funds in US Dollars to the account or accounts specified by the Seller;

 

(ii)         a certificate, dated as of the Closing Date, executed by the
Purchaser confirming the satisfaction of the conditions specified in Section
6.3(a) and Section 6.3(b); and

 

(iii)        the Ancillary Agreements to which the Purchaser or its Affiliates
are a party executed by the Purchaser or the applicable Affiliate of the
Purchaser.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 14

 

 

Article 3
REPRESENTATIONS AND WARRANTIES OF THE SELLER

 

The Seller represents and warrants to the Purchaser that all of the statements
contained in this Article 3 are true and correct as of the date hereof and as of
the Closing Date or, if made as of a specific date, as of such date, subject to
such exceptions as are specifically set forth in the Seller disclosure schedule
to this Agreement (the “Seller Disclosure Schedule”) supplied by the Seller to
the Purchaser on the date hereof:

 

Section 3.1           Organization and Good Standing.

 

(a)          The Seller is an Exempted Limited Partnership duly registered and
validly existing under the Laws of the Cayman Islands. ARIAD US is a corporation
duly organized, validly existing and in good standing under the Laws of the
State of Delaware.

 

(b)          Each Acquired Company is a corporation, limited liability company
or other legal entity duly organized, validly existing and in good standing (to
the extent such concepts are recognized under applicable Law) under the Laws of
the jurisdiction of its formation and has all requisite corporate, limited
liability company or similar power and authority to conduct its business as
presently conducted. Each Acquired Company is duly qualified to do business and
is in good standing (to the extent such concepts are recognized under applicable
Law) as a foreign corporation, limited liability company or otherwise in each
jurisdiction in which the nature of its activities requires such qualification,
except where the failure to so qualify would not have a Material Adverse Effect.

 

(c)          The Seller has delivered to the Purchaser a complete and accurate
copy of the Organizational Documents for each Acquired Company as in effect on
the date hereof and no Acquired Company is in breach or violation of or default
under its Organizational Documents. The Books and Records of each Acquired
Company accurately reflect in all material respects and in a manner consistent
with the historical practices of the Acquired Companies the material actions
taken by written consent or resolution and meetings held by their respective
voting equityholders and directors (or equivalent governing bodies), as the case
may be, and copies of such material actions taken by written consent or
resolutions and meetings have been made available to the Purchaser.

 

(d)          ARIAD Pharmaceuticals (Canada) ULC is a non-operating company, and
it owns no assets or holds any Liabilities.

 

Section 3.2           Authority and Enforceability. Each of the Seller and ARIAD
US has all requisite corporate power and authority to execute and deliver this
Agreement and each Ancillary Agreement to which it is a party and to perform its
obligations under this Agreement and each such Ancillary Agreement. The
execution, delivery and performance of this Agreement and each Ancillary
Agreement to which the Seller or ARIAD US is a party and the consummation of the
transactions contemplated hereby and thereby by the Seller and ARIAD US have
been duly authorized by all necessary action on the part of the Seller and ARIAD
US. Each of the Seller and ARIAD US has duly and validly executed and delivered
this Agreement and, on or prior to the Closing, each of the Seller and ARIAD US
will have duly and validly executed and delivered each Ancillary Agreement to
which it is a party. Assuming the due authorization, execution and delivery of
this Agreement and the Ancillary Agreements by the Purchaser, Incyte US and the
other parties thereto, this Agreement constitutes, and at the Closing each
Ancillary Agreement to which the Seller or ARIAD US is a party will constitute,
the valid and binding obligation of the Seller or ARIAD US, as applicable,
enforceable against the Seller or ARIAD US, as applicable, in accordance with
its terms, subject to (a) Laws of general application relating to bankruptcy,
insolvency

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 15

 

 

and the relief of debtors and (b) Laws governing specific performance,
injunctive relief and other equitable remedies.

 

Section 3.3           No Conflict. Except for the requirements of any Antitrust
Law (if applicable), and except in any case that would not have a Material
Adverse Effect, neither the execution, delivery and performance by the Seller or
ARIAD US of this Agreement and any Ancillary Agreement to which it is a party,
nor the consummation of the transactions contemplated by this Agreement, will
(a) conflict with or violate the Organizational Documents of any of the Acquired
Companies, (b) result in a breach or default under, or create in any Person the
right to terminate, cancel, accelerate or modify, or require any notice, consent
or waiver under, any Material Contract (with or without due notice or lapse of
time or both), (c) violate any Law or Judgment applicable to any of the Acquired
Companies, (d) require any of the Acquired Companies to obtain any Governmental
Authorization or make any filing with any Governmental Authority, (e) result in
the creation of any Claims upon the Shares or the Subsidiary Shares or (f)
result in the imposition of any Lien or other Encumbrance on any of the assets
of the Acquired Companies.

 

Section 3.4           Capitalization and Ownership.

 

(a)          The share capital (or equivalent) of the Acquired Companies, the
number of shares (or equivalent equity interest) and the beneficial and record
ownership thereof, is set forth in Section 3.4(a) of the Seller Disclosure
Schedule. Except as set forth in Section 3.4(a) of the Seller Disclosure
Schedule, the Seller is the sole record holder and beneficial owner of all of
the Shares, free and clear of all Claims. Upon payment in full of the Purchase
Price, good and valid title to the Shares will pass to the Purchaser, free and
clear of any Claims (other than any restrictions or transferability imposed by
applicable securities Laws), and with no restrictions on the voting rights or
other incidents of record and beneficial ownership of such Shares. All of the
Shares are duly authorized, validly issued, fully paid and nonassessable and
were issued in compliance with all applicable Laws.

 

(b)          Section 3.4(b) of the Seller Disclosure Schedule sets forth for all
Acquired Companies (a) its name and jurisdiction of incorporation, (b) its
authorized share capital (or equivalent) and (c) the number of issued and
outstanding shares of share capital (or equivalent) and the record holders and
beneficial owners thereof. No Acquired Company owns or has any rights to
acquire, directly or indirectly, any capital stock or other equity interests of
any Person, except for the Subsidiaries set forth in Section 3.4 of the Seller
Disclosure Schedule. All of the issued and outstanding equity securities of each
Subsidiary of the Company (the “Subsidiary Shares”) are duly authorized, validly
issued, fully paid and nonassessable, and are owned of record and beneficially
by one or more of the Acquired Companies in the respective amounts set forth in
Section 3.4(b) of the Seller Disclosure Schedule.

 

(c)          There are no Contracts to which either the Seller or any other
Person is a party or bound with respect to the voting (including voting trusts
or proxies) of the Shares or the Subsidiary Shares. Other than the Shares and
the Subsidiary Shares, there are no outstanding or authorized shares of capital
stock, options, warrants, rights or Contracts to which any Acquired Company is a
party or which are binding upon any Acquired Company obligating any Acquired
Company to (i) issue, deliver, grant or sell, or cause to be issued, delivered,
granted or sold, additional shares of capital stock of, or other equity or
voting interests in, or options, warrants or other securities or subscription,
preemptive or other rights convertible into, or exchangeable or exercisable for,
shares of capital stock of, or other equity or voting interests in, any Acquired
Company, or any “phantom stock” right, stock appreciation right or other similar
right with respect to any Acquired Company, (ii) repurchase, redeem or otherwise
acquire any shares of capital stock of, or other equity or voting interests in
any Acquired Company or (iii) to enter into any Contract with respect to (i) or
(ii).

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 16

 

 

(d)          Upon consummation of the transactions contemplated by this
Agreement, the Purchaser will own all of the issued and outstanding capital
stock of the Company, free and clear of all Claims.

 

Section 3.5           Brokers Fees.  Neither the Seller nor any Acquired Company
has any Liability to pay any fees or commissions to any broker, finder or agent
in connection with any of the transactions contemplated by this Agreement or any
Ancillary Agreement to which the Purchaser would become liable or obligated or
for which any Acquired Company, after the Closing Date, will have any continuing
obligation.

 

Section 3.6           Financial Statements.

 

(a)          Attached as Section 3.6 of the Seller Disclosure Schedule are the
following:

 

(i)          an audited balance sheet of ARIAD SWISSCO as of December 31, 2015
(the “ARIAD SWISSCO Balance Sheet”) and the related audited statement of income
for the years then ended, including any notes thereto, together with the report
thereon of Deloitte, independent certified public accountants;

 

(ii)         an unaudited consolidated balance sheet of the Company as of
December 31, 2015 and the related unaudited consolidated statement of income for
the years then ended (the “Company Balance Sheet”);

 

(iii)        an unaudited consolidated balance sheet of the Company as of March
31, 2016 (the “Company Interim Balance Sheet”) and the related unaudited
consolidated statement of income for the year-to-date period then ended; and

 

(collectively (i), (ii) and (iii) the “Financial Statements”)

 

(iv)        a reconciliation between the ARIAD SWISSCO Balance Sheet and the
related statement of income under Swiss generally accepted accounting principles
to GAAP.

 

(b)          The Financial Statements fairly present in all material respects
the financial condition and results of operations of the Acquired Companies as
of the respective dates thereof and for the periods indicated therein, in
accordance with Swiss generally accepted accounting principles with respect to
the ARIAD SWISSCO Balance Sheet and in accordance with GAAP with respect to the
Company Balance Sheet and the Company Interim Balance Sheet (except that the
Company Interim Balance Sheet is subject to normal year-end adjustments and does
not contain all footnotes or other presentation items as required by GAAP).

 

(c)          The Seller maintains a system of “internal control over financial
reporting” (as defined in Rule 13a-15(f) of the Exchange Act) sufficient to
provide reasonable assurance (i) that transactions of the Acquired Companies are
made in accordance with management’s authorization, (ii) that transactions of
the Acquired Companies are recorded as necessary to permit the preparation of
Seller’s consolidated financial statements in conformity with GAAP and (iii)
regarding prevention or timely detection of the unauthorized acquisition, use or
disposition of the properties or assets of the Acquired Companies.

 

Section 3.7           No Undisclosed Liabilities. No Acquired Company has any
Liabilities as of the date of this Agreement that would be required to be
reflected on a consolidated balance sheet prepared in accordance with GAAP
except for (a) Liabilities reflected, reserved against or otherwise disclosed in
the Financial Statements, (b) Liabilities arising in the ordinary course of
business consistent with past

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 17

 

 

practice after the date of the Company Interim Balance Sheet, (c) Liabilities
disclosed herein or in the Seller Disclosure Schedule, including Section 3.7 of
the Seller Disclosure Schedule or (d) Liabilities in an amount that do not
exceed US Dollars 500,000 in the aggregate.

 

Section 3.8           Absence of Certain Changes and Events. From the date of
the ARIAD SWISSCO Balance Sheet to the date of this Agreement, the Acquired
Companies have operated their business in the ordinary course of business and
there has not been with respect to any Acquired Company any:

 

(a)          amendment to its Organizational Documents;

 

(b)          change in its authorized or issued share capital (or equivalent),
declaration, setting aside or payment of a dividend or other distribution
(whether in cash, stock or property) in respect of any share capital (or
equivalent), or issuance, sale, grant, repurchase or redemption of any shares of
its share capital (or equivalent) or any securities convertible, exchangeable or
redeemable for, or any options, warrants or other rights to acquire, any such
securities;

 

(c)          incurrence of any Indebtedness in amounts in excess of US Dollars
50,000 individually or US Dollars 500,000 in the aggregate, that would be
outstanding immediately following the Closing;

 

(d)          sale, lease, license or transfer of, or Encumbrance on, any
material portion of its assets other than in the ordinary course of business;

 

(e)          damage to, or destruction or loss of, any of material asset of the
Acquired Company not covered by insurance;

 

(f)          except as required by Law, adoption of, material amendment to or
material increase in the payments to or benefits under, any Company Plan;

 

(g)          waiver or release of any material right or claim other than in the
ordinary course of business;

 

(h)          change in the accounting methods used by the Acquired Companies;

 

(i)          making or rescission of any Tax election, settlement or compromise
of any Tax Liability or amendment of any Tax Return;

 

(j)          payment, discharge or satisfaction of any claim, liability or
obligation (absolute, accrued, asserted or unasserted, contingent or otherwise
of the Acquired Company), other than payments, discharges or satisfactions in
the ordinary course of business of Liabilities or arising in the ordinary course
of business since the date of the ARIAD SWISSCO Balance Sheet;

 

(k)          revaluation by the Acquired Company of any of its assets (whether
tangible or intangible), including writing down the value of inventory or
writing off notes or accounts receivable;

 

(l)          loan by the Acquired Company to any Person, or purchase by the
Acquired Company of any debt securities of any Person, except for advances to
Employees for travel and business expenses in the ordinary course of business;
or

 

(m)          agreement in writing by any Acquired Company to do any of the
foregoing.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 18

 

 

Section 3.9           Tangible Personal Property.

 

(a)          The Acquired Companies, as applicable, have good and marketable
title to, or in the case of leased assets, valid leasehold interests in, all of
their tangible personal property, free and clear of all Encumbrances except as
set forth in Section 3.9(a) of the Seller Disclosure Schedule.

 

(b)          Section 3.9(b) of the Seller Disclosure Letter sets forth an
accurate and complete list of leases of personal property or equipment having a
value in excess of US Dollars 50,000.

 

Section 3.10         Leased Real Property.

 

(a)          Section 3.10 of the Seller Disclosure Schedule sets forth an
accurate and complete description (by street address of the subject leased real
property, the date and term of the lease, the name of the parties thereto and
the aggregate annual rent payable thereunder) of all real property that is
leased by any Acquired Company (the “Leased Real Property”). The Seller has made
available to the Purchaser complete copies of the leases in effect as of the
date hereof relating to the Leased Real Property (the “Real Property Leases”)
and there has not been any sublease or assignment entered into by any Acquired
Company in respect of the leases relating to such Leased Real Property. No
Acquired Company is in default of any material provision of any lease of any of
the Leased Real Property.

 

(b)          Each applicable Acquired Company has peaceful, undisturbed and
exclusive possession of the Leased Real Property at Section 3.10(b) of the
Seller Disclosure Schedule (the “Warranted Leased Real Property”), and no
Acquired Company has assigned (collaterally or otherwise) or granted any other
security interest in the Warranted Real Property Leases or any interest therein,
and there are no Liens on the estate or interest created by the Warranted Real
Property Leases. The full amount of security deposit required under each lease
of Warranted Leased Real Property, if any, is on deposit thereunder.

 

(c)          The use of the Warranted Leased Real Property, or any portion
thereof, and the improvements erected thereon, do not violate or conflict in any
material respect with (i) any Law, Permit, covenants, conditions or restrictions
applicable thereto; or (ii) the terms and provisions of any Contract relating
thereto.

 

(d)          Except in any case that would not reasonably be expected to be
material to the business of the Acquired Companies, take as a whole, (i) there
is no pending, or to the Knowledge of the Seller, threatened, appropriation,
condemnation or like Proceeding affecting the Warranted Leased Real Property or
any part thereof; and (ii) no Acquired Company has received written notice that
is in violation of any applicable zoning law, regulation or other applicable
Law, related to or affecting the Warranted Leased Real Property.

 

(e)          The Warranted Leased Real Property is in good operating condition
and repair and is suitable for the conduct of the Acquired Companies’ business
as presently conducted therein, except where the failure of the property to be
in good operating condition would not have a Material Adverse Effect.

 

(f)          No Person other than an Acquired Company is in possession of the
Warranted Leased Real Property or any portion thereof, and there are no leases,
licenses, subleases, concessions or other Contracts, written or oral, granting
to any other Person the right to use or occupy the Warranted Leased Real
Property or any portion thereof.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 19

 

 

Section 3.11         Intellectual Property.

 

(a)          The Acquired Companies own all rights, title and interest in, or
otherwise have the right to use, make, have made, sell, have sold, develop,
commercialize and import the Compound and Product under all Intellectual
Property used in the operation of their business as presently conducted (the
“Company Intellectual Property”), except where the failure to own or have the
right to use such Company Intellectual Property would not have a Material
Adverse Effect.

 

(b)          To the Seller’s Knowledge, the claims of the issued patents listed
in Section 3.11(b) of the Seller Disclosure Schedule are not invalid and the
issued patents included in Section 3.11(b) of the Seller Disclosure Schedule are
not unenforceable in the Territory. No Third Party has challenged in writing,
or, to the Company’s Knowledge, has threatened to challenge, the enforceability
or validity of any issued patents included in Section 3.11(b) of the Seller
Disclosure Schedule or any claims therein, respectively in the Territory through
the institution of legal proceedings in a court or through revocation,
opposition, interference, reexamination, nullity or similar invalidity
proceedings before a patent office or any equivalent entity in the Territory. To
the Seller’s Knowledge, no Third Party is infringing the patents listed in
Section 3.11(b) of the Seller Disclosure Schedule.

 

(c)          No Third Party has challenged in writing, or, to the Seller’s
Knowledge, has threatened to challenge, the Company’s right to use and license
the trademarks listed in Section 3.11(c) of the Seller Disclosure Schedule in
the Territory.

 

(d)          There are no claims asserted in writing, Judgments, or settlements
in effect against, or amounts with respect thereto owed by, the Acquired
Companies relating to the patents listed in Section 3.11(b) of the Seller
Disclosure Schedule in the Territory. No claim or litigation is pending or, to
the Seller’s Knowledge, threatened alleging that the manufacture, development,
use or sale of the Product in the Territory as of the date of this Agreement
infringes or would infringe any issued patent in the Territory existing as of
the date of this Agreement.

 

(e)          The patents listed in Section 3.11(b) of the Seller Disclosure
Schedule have been filed and maintained, and are being diligently prosecuted, in
the respective patent offices where filed in the Territory in accordance with
applicable Laws. All applicable and material fees that are finally due prior to
the date of this Agreement in connection with the prosecution and maintenance of
the patents listed in Section 3.11(b) of the Seller Disclosure Schedule in the
Territory have been paid.

 

(f)          Section 3.11(f) of the Seller Disclosure Schedule lists each
written Contract under which any of Seller, ARIAD US or Acquired Company has
granted a license to a Third Party to, make, have made, sell, have sold,
develop, commercialize and import the Compound and Product in the Territory
under the Intellectual Property of the Seller, ARIAD US or any Acquired Company.

 

This Section 3.11 constitutes the sole and exclusive representations and
warranties of the Seller with respect to any matters relating to Intellectual
Property.

 

Section 3.12         Contracts.  

 

(a)          Section 3.12(a) of the Seller Disclosure Schedule sets forth an
accurate and complete list as of the date hereof of each Contract to which any
Acquired Company is a party, which:

 

(i)          is an executory Contract for the purchase or sale of materials,
supplies, goods, equipment or services that involves the payment by or to any
Acquired Company of more than US Dollars 250,000 in any twelve (12) month
period;

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 20

 

 

(ii)         is for capital expenditures in excess of US Dollars 250,000;

 

(iii)        is a mortgage, indenture, guarantee, loan or credit agreement,
security agreement or other Contract relating to indebtedness for borrowed
money, other than accounts receivables and payables in the ordinary course of
business;

 

(iv)        is a written Contract under which any Acquired Company has granted
to or received from a Third Party a license to use, make, have made, sell, have
sold, develop, commercialize and import the Compound and Product under the
Intellectual Property of such Acquired Company or Third Party (except for any
license implied by the sale of a product, licenses for use of Trademarks in
marketing or promotional materials and licenses for commonly available software
programs with a value of less than US Dollars 250,000);

 

(v)         is a Contract that limits or purports to limit the ability of the
Acquired Companies to compete in any line of business or with any Person or in
any geographic area;

 

(vi)        is a written Contract with a Transferred Employee that provides for
payments in excess of US Dollars 250,000 per annum (excluding any Contract that
does not provide severance or termination payments);

 

(vii)       is a lease of personal property or equipment having a value in
excess of US Dollars 100,000; or

 

(viii)      is an agreement of indemnification or guaranty, but excluding
agreements of indemnification or guaranty that are contained in the Company’s
written Contracts with its customers, suppliers and service providers that have
been entered into in the ordinary course of business.

 

The Contracts listed in Section 3.12(a) of the Seller Disclosure Schedule are
referred to in this Agreement as the “Material Contracts.”

 

(b)          The Seller has made available to the Purchaser an accurate and
complete copy of each Material Contract. With respect to each such Material
Contract, neither any Acquired Company party to the Material Contract, nor, to
the Seller’s Knowledge, any other party to the Material Contract is in breach or
default under the Material Contract, except for such breaches or defaults as to
which requisite waivers or consents have been obtained or which would not have a
Material Adverse Effect. Each Material Contract is enforceable as to the
applicable Acquired Company party thereto in accordance with its terms except to
the extent it has previously expired in accordance with its terms and subject to
(i) Laws of general application relating to bankruptcy, insolvency and the
relief of debtors, and (ii) rules of Law governing specific performance,
injunctive relief and other equitable remedies. To the Seller’s Knowledge, no
party to a Material Contract intends to terminate such Material Contract with
the applicable Acquired Company party thereto.

 

Section 3.13         Tax Matters.

 

(a)          (i) All material Tax Returns required to be filed by the Acquired
Companies have been timely filed, (ii) all Taxes shown on such Tax Returns have
been paid, (iii) no Governmental Authority has proposed formally in writing to
make or has made any material adjustment with respect to such Tax Returns, (iv)
no Acquired Company has any Liability for any Tax obligation of any other
taxpayer (including any Affiliated Group), including any obligation under any
Tax sharing agreement or under

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 21

 

 

Section 1.1502-6 of the Treasury Regulations or any similar provision of any
Law, (v) no Section 280G (or similar foreign tax provision) will be triggered by
the transactions contemplated by this Agreement, (vi) any unpaid Taxes do not
exceed the reserves for Taxes as set forth in the Company Interim Balance Sheet,
and (vii) the Acquired Companies have no Tax liens. The Seller has made
available to the Purchaser accurate and complete copies of all Tax Returns filed
by the Acquired Companies for the years ended December 31, 2014, and December
31, 2013.

 

(b)          All Taxes that each Acquired Company is required by Law to withhold
or collect have been properly withheld or collected, and, to the extent required
by applicable Law, have been paid over to the proper Governmental Authority.

 

(c)          To the Seller’s Knowledge, no federal, state, local or foreign Tax
Contests or other Proceedings are pending or being conducted, nor has any
Acquired Company received any written notice from any Governmental Authority
that any such Tax Contest or other Proceeding is pending, threatened or
contemplated. No Acquired Company has waived any statute of limitations with
respect to Taxes or agreed to an extension of time with respect to a Tax
assessment or deficiency affecting the Acquired Company, which waiver or
extension of time is currently outstanding.

 

This Section 3.13 constitutes the sole and exclusive representations and
warranties of the Seller with respect to any matters relating to Taxes.

 

Section 3.14         Employee Benefit Matters.  

 

(a)          Section 3.14(a) of the Seller Disclosure Schedule sets forth an
accurate and complete list of all Company Plans.

 

(b)          The Seller has made available to the Purchaser an accurate,
up-to-date and complete copy of each Company Plan that has been reduced to
writing.

 

(c)          The Acquired Companies have performed all of their obligations
under each Company Plan in all material respects in accordance with the terms of
such Company Plan. The Acquired Companies have complied with all obligations
under applicable Law to inform and consult the Transferred Employees or their
representatives about the transaction contemplated in this Agreement.

 

(d)          Section 3.14(d) of the Seller Disclosure Schedule sets forth an
accurate and complete list of: (i) any employment, severance and change of
control agreement with any Transferred Employee the benefits of which are
contingent upon the occurrence of a transaction involving the Company of the
nature of the transactions contemplated by this Agreement (either alone or upon
termination of employment following such transactions); and (ii) any agreement
or plan binding upon any Acquired Company, including, any Company Plan, any of
the benefits of which will be increased, or the vesting of the benefits of which
will be accelerated, by the consummation of the transactions contemplated by
this Agreement (either alone or upon the termination of employment following
such transactions).

 

This Section 3.14 constitutes the sole and exclusive representations and
warranties of the Seller with respect to any matters relating to Employee
Benefit Matters.

 

Section 3.15         Employment and Labor Matters.

 

(a)          Except as set forth in Section 3.15 of the Seller Disclosure
Schedule, no Acquired Company is a party to or bound by any collective
bargaining agreement, works council agreement or any

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 22

 

 

other agreement with a body representing any or all of the Transferred Employees
and, to the Seller’s Knowledge, no petition has been filed or Proceedings
instituted by any Transferred Employee or group of Transferred Employees of any
Acquired Company seeking recognition of a bargaining representative or other
works council agreement or any other agreement with a body representing any or
all of the Transferred Employees. There is no labor strike, picketing, slowdown,
lockout, or other work stoppage or labor dispute pending or, to the Seller’s
Knowledge, threatened between any Acquired Company, on the one hand, and any of
its Transferred Employees, on the other hand, except for such disputes with
individual Transferred Employees arising in the ordinary course of business.

 

(b)          The Acquired Companies are in compliance in all material respects
with all applicable Laws pertaining to the employment of their Transferred
Employees, including all such Laws relating to equal employment opportunities,
prohibited discrimination and other similar employment activities. Section 3.15
of the Seller Disclosure Schedule sets forth an accurate and complete list (as
at the date of this Agreement) of all Transferred Employees of any Acquired
Company, together with their salary, job title, notice period, benefits, start
date of employment and role and place of work. There has been no material change
to such compensation or benefits during the 120 days preceding the date of this
Agreement. The Seller has provided to the Purchaser an accurate and complete
list (as at the date of this Agreement) of all equity awards granted to
Transferred Employees.

 

(c)          Section 3.15(c) of the Seller Disclosure Schedule sets forth an
accurate and complete list as of the date hereof of each Contract providing for
the grant of any severance or termination pay or benefits (in cash or otherwise)
to any Transferred Employee (in excess of a payment in respect of their notice
period or any severance payment required by Law).

 

This Section 3.15 constitutes the sole and exclusive representations and
warranties of the Seller with respect to any matters relating to Employment and
Labor Matters.

 

Section 3.16         Environmental, Health and Safety Matters. The Acquired
Companies are in compliance in all material respects with (a) all Environmental
Laws applicable to the conduct of their business as presently conducted and the
occupancy of the Warranted Leased Real Property as presently occupied and (b)
all Governmental Authorizations required of the Acquired Companies under
Environmental Laws to conduct their business as presently conducted or to occupy
the Warranted Leased Real Property as presently occupied. No Acquired Company
has received any written notice stating that the conduct of its business or the
condition of any of its Warranted Leased Real Property is currently in violation
of any Environmental Law (including, to the Seller’s Knowledge, any claim or
complaint from any Employee alleging exposure to Hazardous Material). To the
Seller’s Knowledge, no Acquired Company has (i) disposed of, emitted,
discharged, handled, stored, transported, used or released any Hazardous
Material, arranged for the disposal, discharge, storage or release of any
Hazardous Material, or (ii) entered into any written Contract that may require
it to guarantee, reimburse, pledge, defend, hold harmless or indemnify any other
party with respect to Liabilities arising out of Environmental Laws or the
Hazardous Material related activities. No Proceeding is pending or, to the
Seller’s Knowledge, threatened against any Acquired Company that alleges a
material violation by any Acquired Company of any applicable Environmental Laws.

 

This Section 3.16 constitutes the sole and exclusive representations and
warranties of the Seller with respect to any matters relating to Environmental,
Health and Safety Matters.

 

Section 3.17         Governmental Authorizations. Except as set forth in Section
3.17 of the Seller Disclosure Schedule or as would not reasonably be expected to
have a Material Adverse Effect, the Acquired Companies have all Governmental
Authorizations that are necessary for them to conduct their

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 23

 

 

business in the manner in which it is presently conducted, the Acquired
Companies are in compliance with all such Governmental Authorizations and all
such Governmental Authorizations are in full force and effect. Neither the
Seller nor the Acquired Companies have received any written notice that any
Governmental Authority with jurisdiction in the Territory over the Products has
commenced or will commence any action: (i) to suspend, revoke, not renew or
materially amend any Governmental Authorizations in the Territory; or (ii)
prohibit production, marketing or sale of any Product in the Territory.

 

Section 3.18         Compliance with Laws. The Acquired Companies are in
compliance in all material respects with all Laws applicable to them or the
conduct of their business or the ownership or use of their properties and assets
in the Territory. To the Seller’s Knowledge, neither the Acquired Companies nor,
any of their respective directors, officers, employees or agents have in the
last three (3) years and in any material respect related to the business of the
Acquired Companies, directly or indirectly, made, offered, promised or
authorized any payment or gift of any money or anything of value to or for the
benefit of any “foreign official” (as such term is defined in the U.S. Foreign
Corrupt Practices Act of 1977, as amended (the “FCPA”)), foreign political party
or official thereof or candidate for foreign political office for the purpose of
(i) influencing any official act or decision of such official, party or
candidate, (ii) inducing such official, party or candidate to use his, her or
its influence to affect any act or decision of a foreign Governmental Authority,
or (iii) securing any improper advantage, in the case of (i), (ii) and (iii)
above in order to assist the Company or any of its Affiliates obtain or retain
business and in violation of the FCPA. Neither the Acquired Companies nor, to
the Seller’s Knowledge, any of their respective directors, officers, employees
or agents have made or authorized any bribe, rebate, payoff, influence payment,
kickback or other unlawful payment of funds or received or retained any funds in
violation of any applicable Law. Neither the Acquired Companies nor, to the
Seller’s Knowledge, any of their respective officers, directors or employees,
have received any written notice from any Governmental Authority stating that
they are the subject of any allegation, voluntary disclosure, investigation,
prosecution or other enforcement action related to the FCPA or any other
anti-corruption law.

 

Section 3.19         Product Liability. Except as would not have a Material
Adverse Effect, the Products sold by the Acquired Companies have complied in all
material respects with all applicable product specifications contained in the
relevant Marketing Authorizations. Except as would not have a Material Adverse
Effect, none of the Products after being sold have been the subject of any
product recall ordered by any Government Authority and, to the Seller’s
Knowledge, no circumstances currently exist which are reasonably likely to cause
any such product recall to be initiated.

 

Section 3.20         Legal Proceedings. There is no material Proceeding pending
or, to the Seller’s Knowledge, threatened against any Acquired Company, any of
its officers or directors or any of its properties or assets. No Acquired
Company is subject to any outstanding Judgment.

 

Section 3.21         Insurance. The Company maintains, and through the Closing
will continue to maintain, in full force and effect, policies of insurance
against fire, theft and other casualties, and covering such other Liabilities
and business risks and properties of the Acquired Companies which are
customarily insured against by companies of similar size and in the industry in
which the Acquired Companies operate. There is no claim by the Company pending
under any of such policies as to which coverage has been denied by the
underwriters of such policies. All premiums due and payable under all such
policies have been paid (or if installment payments are due, will be paid if
incurred prior to the Closing Date) and the Company is otherwise in material
compliance with the terms of such policies. Such policies are in full force and
effect.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 24

 

 

Section 3.22         Customers.

 

(a)          Section 3.22(a) of the Seller Disclosure Schedule sets forth a
complete and accurate list of the 10 largest customers of the Acquired Companies
based on net sales during each of the calendar years ended 2015 and 2014 and the
calendar-year-to-date period ended March 31, 2016 (the “Material Customers”).
Such net sale amounts are also set forth on Section 3.22(a) of the Seller
Disclosure Schedule. No Material Customer has canceled, terminated or otherwise
materially and adversely modified, or, to the Seller’s Knowledge, threatened to
cancel, terminate, or otherwise materially and adversely modify, its
relationship with any Acquired Company and no Acquired Company has received
written notice that any Material Customer may take such action or limit its
purchases from any Acquired Company, either as a result of the consummation of
the transactions contemplated by this Agreement or otherwise.

 

(b)          Since the date of the ARIAD SWISSCO Balance Sheet, no Acquired
Company has taken, or permitted any Representative to take, any action that was
designed to have the effect of accelerating the timing of sales or the provision
of products or services by any Acquired Company or of invoicing therefore.
Without limitation of the foregoing, since the date of the ARIAD SWISSCO Balance
Sheet, no Acquired Company has sold or provided any amount of products or
services (a) with payment terms longer than terms customarily offered by such
Acquired Company for such product, (b) at a discount from the listed price
materially differing from any discounts customarily offered by such Acquired
Company, or (c) with shipment or similar terms materially differing from the
shipment or similar terms customarily offered by such Acquired Company.

 

(c)          Section 3.22(c) of the Seller Disclosure Schedule sets forth a
description of all incentives (including coupon, discount, allowance, rebate,
bill-back, price concession or advertising fund payment activities or programs
and the like) and pricing allowances (including slotting allowances, retailer or
distributor ads, store display allowances and similar items) offered by the
Acquired Companies to its customers that are in effect as of the date hereof.

 

Section 3.23         Interested Party Transactions. To the Seller’s Knowledge,
no officer or director of any Acquired Company (or any Affiliate or member of
the immediate family (as such term is defined in Rule 16a-1 of the Exchange Act)
of such officer or director) has or has had: (a) an interest in any entity which
furnished or sold or licensed, or furnishes or sells or licenses, Products or
right to Company Intellectual Property that any Acquired Company furnishes or
sells or (ii) any interest in any entity that purchases from or sells or
furnishes to the any Acquired Company, any goods or services; provided, however,
that ownership of no more than one percent (1%) of the outstanding voting stock
of a publicly traded corporation shall not be deemed to be an “interest in any
entity” for purposes of this Section 3.23.

 

Section 3.24         Bank Accounts. Section 3.24 of the Seller Disclosure
Schedule lists (a) all bank accounts, lock boxes and safe deposit boxes relating
to the business and operations of the Acquired Companies (including the name of
the bank or other institution where such account or box is located and the name
of each authorized signatory thereto) and (b) the name and address of each
Person who has a power of attorney to act on behalf of any Acquired Company.

 

Section 3.25         No Other Representations or Warranties. Except for the
representations and warranties set forth in this Article 3, neither the Seller,
nor any other Person, makes any other express or implied representation or
warranty on behalf of the Seller or any of its Affiliates with respect to the
Shares, the Seller, the Acquired Companies or any other matter relating to the
transactions contemplated by this Agreement. The Seller makes no representations
or warranties to the Purchaser regarding the probable success or profitability
of the Acquired Companies. The disclosure of any matter or item in any

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 25

 

 

schedule hereto shall not be deemed to constitute an acknowledgement that any
such matter is required to be disclosed.

 

Article 4
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

 

The Purchaser represents and warrants to the Seller as of the date of this
Agreement and as of the Closing Date:

 

Section 4.1           Organization and Good Standing. The Purchaser is an entity
duly organized, validly existing and in good standing under the Laws of
Switzerland. Incyte US is a corporation duly organized, validly existing and in
good standing under the Laws of the State of Delaware.

 

Section 4.2           Authority and Enforceability. Each of the Purchaser and
Incyte US has all requisite corporate power and authority to execute and deliver
this Agreement and each Ancillary Agreement to which it is a party and to
perform its obligations under this Agreement and each such Ancillary Agreement.
The execution, delivery and performance of this Agreement and each Ancillary
Agreement to which the Purchaser or Incyte US is a party and the consummation of
the transactions contemplated hereby and thereby have been duly authorized by
all necessary action on the part of the Purchaser and Incyte US. Each of the
Purchaser and Incyte US has duly and validly executed and delivered this
Agreement and, on or prior to the Closing, each of the Purchaser and Incyte US
will have duly and validly executed and delivered each Ancillary Agreement to
which it is a party. Assuming the due authorization, execution and delivery of
this Agreement and the Ancillary Agreements by the Seller, ARIAD US and the
other parties thereto, this Agreement constitutes, and at the Closing each
Ancillary Agreement to which the Purchaser or Incyte US is a party will
constitute, the valid and binding obligation of the Purchaser or Incyte US, as
applicable , enforceable against the Purchaser or Incyte US, as applicable, in
accordance with its terms, subject to (a) Laws of general application relating
to bankruptcy, insolvency and the relief of debtors and (b) Laws governing
specific performance, injunctive relief and other equitable remedies.

 

Section 4.3           No Conflict. Except for the requirements of any Antitrust
Law (if applicable), and except in any case that would not have a material
adverse effect on the ability of the Purchaser or Incyte US to perform its
obligations under this Agreement or on the ability of the Purchaser or Incyte US
to consummate the transactions contemplated by this Agreement, neither the
Purchaser’s or Incyte US’s execution, delivery and performance of this Agreement
and any Ancillary Agreement to which the Purchaser or Incyte US is a party, nor
the consummation of the transactions contemplated by this Agreement, will (a)
conflict with or violate the Purchaser’s or Incyte US’s Organizational
Documents, (b) result in a breach or default under or create in any Person the
right to terminate, cancel, accelerate or modify, or require any notice, consent
or waiver under, any Contract to which the Purchaser or Incyte US is a party or
by which the Purchaser or Incyte US is bound, in any case with or without due
notice or lapse of time or both, (c) result in the imposition of any lien or
other encumbrance on any of the assets of the Purchaser or Incyte US, (d)
violate any Law or Judgment applicable to the Purchaser or Incyte US or (e)
require the Purchaser or Incyte US to obtain any Governmental Authorization or
make any filing with any Governmental Authority.

 

Section 4.4           Legal Proceedings. There is no Proceeding pending, or, to
the Purchaser’s knowledge, threatened against the Purchaser that questions or
challenges the validity of this Agreement or that may prevent, delay, make
illegal or otherwise interfere in any material respect with the ability of the
Purchaser to consummate any of the transactions contemplated in this Agreement.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 26

 

 

Section 4.5           Investment Intent. The Purchaser is acquiring the Shares
for the Purchaser’s own account and investment purposes and is not acquiring the
Shares with a view to, or for sale in connection with, any distribution thereof
within the meaning of any federal or state securities Laws. The Purchaser is an
“accredited investor” within the meaning of Rule 501(a) of Regulation D as
promulgated by the Securities and Exchange Commission under the Securities Act
of 1933, as amended, and has sufficient business and financial knowledge and
experience to protect its own interests and to evaluate the merits and risks in
connection with the purchase of the Shares.

 

Section 4.6           Brokers Fees. Neither the Purchaser nor any Person acting
on its behalf has incurred any Liability to pay any fees or commissions to any
broker, finder or agent in connection with any of the transactions contemplated
by this Agreement.

 

Section 4.7           Financial Capacity. The Purchaser has, or will have on the
Closing Date, immediately available cash in an amount sufficient to pay the
Purchase Price.

 

Section 4.8           Independent Investigation. The Purchaser has conducted its
own independent investigation, review and analysis of the business, operations,
assets, liabilities, results of operations, financial condition and prospects of
the business of the Acquired Companies as it has deemed appropriate, which
investigation, review and analysis was done by the Purchaser and its Affiliates
and Representatives. The Purchaser acknowledges that it and its Affiliates and
Representatives have been provided adequate access to the personnel, properties,
premises and records of the Acquired Companies for such purpose. In entering
into this Agreement, the Purchaser acknowledges that it has relied solely upon
the aforementioned investigation, review and analysis and not on any factual
representations or opinions of the Seller, the Acquired Companies or their
Representatives (except the representations and warranties set forth in Article
3). The Purchaser hereby acknowledges and agrees that other than the
representations and warranties set forth in Article 3, none of the Seller, the
Acquired Companies, or any other Person makes or has made any other express or
implied representation or warranty on behalf of the Seller or any of its
Affiliates with respect to the Shares, the Seller, the Acquired Companies or any
other matter relating to the transactions contemplated by this Agreement.

 

Article 5
PRE-CLOSING COVENANTS

 

Section 5.1           Access and Investigation; Notice. Until the Closing and
upon reasonable advance notice from the Purchaser, the Seller will and will
cause the Acquired Companies to allow the Purchaser and its Representatives
reasonable access during normal business hours and without unreasonable
interference with the operation of the business of the Acquired Companies to (a)
such materials and information about the Acquired Companies as the Purchaser may
reasonably request and (b) specified members of management of the Acquired
Companies as the Parties may reasonably agree. Notwithstanding the foregoing,
the Seller will not be required to disclose (or cause the Acquired Companies to
disclose) any information to the Purchaser or its Representatives if such
disclosure would be reasonably likely to: (x) cause significant competitive harm
to the business of the Acquired Companies if the transactions contemplated
hereby are not consummated, (y) jeopardize any attorney-client or other legal
privilege or (z) contravene any applicable Laws (including Antitrust Laws),
fiduciary duty or binding agreement entered into prior to the date hereof. The
Purchaser will, and will cause its Representatives to, hold confidentially all
information so obtained in accordance with the terms of the Confidentiality
Agreement. Seller will provide prompt written notice to the Purchaser of any
event, circumstance, development, material or other information that the Seller
reasonably determines would have a Material Adverse Effect.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 27

 

 

Section 5.2           Operation of the Businesses of the Acquired Companies.  

 

(a)          Until the Closing, except as otherwise set forth in this Agreement
or Section 5.2(a) of the Seller Disclosure Schedule, required by Law or as
otherwise consented to by the Purchaser (which consent will not be unreasonably
withheld, conditioned or delayed), the Seller will cause the Acquired Companies
to conduct their business in the ordinary course of business in substantially
the same manner as heretofore conducted, and, to the extent consistent
therewith, use commercially reasonable efforts to preserve the relationships of
the Acquired Companies with their customers, suppliers, distributors, licensors,
licensees, and others doing business with them and to preserve the goodwill and
ongoing operations of the Acquired Companies.

 

(b)          Until the Closing, except as otherwise set forth in this Agreement
or Section 5.2(b) of the Seller Disclosure Schedule or as otherwise consented to
by the Purchaser (which consent will not be unreasonably withheld, conditioned
or delayed), the Seller will not cause or permit any Acquired Company to:

 

(i)          amend its Organizational Documents;

 

(ii)         issue, sell or pledge additional shares of its capital stock or
securities convertible into any such shares, or any options, warrants or rights
to acquire any such shares or other convertible securities;

 

(iii)        purchase, redeem or otherwise acquire any outstanding shares of its
capital stock;

 

(iv)        declare, set aside or pay any dividend or other distribution in
respect of its capital stock, other than in cash in the ordinary course of
business in connection with the Company’s cash management practices;

 

(v)         pay, discharge, waive or satisfy, any Indebtedness other than in the
ordinary course of business;

 

(vi)        adopt or change accounting methods or practices (including any
change in depreciation or amortization policies), except as required by GAAP or
applicable Law;

 

(vii)       make or change any Tax election, adopt or change any Tax accounting
method, enter into any closing agreement with respect to Taxes, settle or
compromise any material Tax claim or assessment, consent to any extension or
waiver of the limitation period applicable to any material Tax claim or
assessment or file any material Tax Return or any amended Tax Return unless a
copy of such Tax Return has been delivered to the Purchaser for review a
reasonable time prior to filing;

 

(viii)      make any loan to any Person or purchase debt securities of any
Person or amend the terms of any outstanding loan agreement;

 

(ix)         incur any Indebtedness, guarantee any Indebtedness of any Person,
issue or sell any debt securities, or guarantee any debt securities of any
Person;

 

(x)          commence or settle any lawsuit, threat of any lawsuit or proceeding
or other investigation against the Company involving an amount in dispute
greater than US Dollars 50,000;

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 28

 

 

(xi)         enter into any agreement to purchase or sell any interest in real
property, grant any security interest in any real property, enter into any
lease, sublease, license or other occupancy agreement with respect to any real
property or alter, amend, modify or terminate any of the terms of any Real
Property Leases;

 

(xii)        terminate or materially and adversely amend any Material Contract;

 

(xiii)       waive or release any right or claim of a material value to the
Acquired Companies other than in the ordinary course of business;

 

(xiv)      sell, lease or license, or permit any Encumbrance on, any material
portion of its assets other than in the ordinary course of business;

 

(xv)       acquire, by merger or consolidation with, or by purchase of all or a
substantial portion of the assets or stock of, or by any other manner, any
business or entity, or enter into any joint venture, partnership or other
similar arrangement for the conduct of its business;

 

(xvi)      change in any material respect the remuneration or terms of
employment of any of its Employees or make offers to employ or engage any other
personnel (other than to replace any Employees who have resigned or served or
been served with notice to end their employment) other than (A) in the ordinary
course of business, (B) as required by Law or (C) for retention, incentive and
similar payments relating to the consummation of the transactions contemplated
by this Agreement;

 

(xvii)     except in cooperation with the Purchaser, make any representations
regarding offers of employment from the Purchaser or the terms thereof;

 

(xviii)    alter, or enter into any commitment to alter, its interest in any
corporation, association, joint venture, partnership or business entity in which
any Acquired Company directly or indirectly holds any interest;

 

(xix)       cancel, amend or renew any insurance policy; or

 

(xx)        agree in writing to take any of the foregoing actions.

 

Section 5.3           Consents and Filings; Commercially Reasonable Efforts.

 

(a)          Subject to the terms and conditions of this Agreement and unless
otherwise specified in this Agreement, each of the parties will use their
respective commercially reasonable efforts (i) to take promptly, or cause to be
taken, all actions, and to do promptly, or cause to be done, all things
reasonably necessary to consummate and make effective the transactions
contemplated by this Agreement and (ii) as promptly as practicable after the
date of this Agreement, to obtain all Governmental Authorizations from, and make
all filings with, all Governmental Authorities (including Antitrust Approvals),
and to obtain all other consents, waivers, approvals and other authorizations
from, all other third parties, that are reasonably necessary in connection with
the authorization, execution and delivery of this Agreement and the consummation
of the transactions contemplated by this Agreement.

 

(b)          The Purchaser will be solely responsible for all filing fees due
under antitrust or other competition Laws (“Antitrust Laws”) in connection with
any Antitrust Approvals and neither the Seller nor any Acquired Company will
have any Liability with respect to the payment of such filing fees.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 29

 

 

(c)          The Seller and the Purchaser will promptly notify the other of any
communication it or any of its Affiliates receives from any Governmental
Authority relating to the transactions contemplated by this Agreement, and will
permit the other party to review in advance any proposed communication by such
party to any Governmental Authority. Neither party will agree to participate in
any meeting with any Governmental Authority in respect of any filings,
investigation or other inquiry unless it consults with the other party in
advance and, to the extent permitted by such Governmental Authority, gives the
other party the opportunity to attend and participate at such meeting. The
Seller and the Purchaser will coordinate and cooperate fully with each other in
exchanging such information and providing such assistance as the other party may
reasonably request in connection with the foregoing and in seeking early
termination of any applicable waiting periods under any Antitrust Laws. The
Seller and the Purchaser will provide each other with copies of all
correspondence, filings or communications between them or any of their
Representatives, on the one hand, and any Governmental Authority or members of
its staff, on the other hand, with respect to this Agreement and the
transactions contemplated by this Agreement.

 

(d)          The Purchaser and the Seller will use commercially reasonable
efforts to respond to any request for additional information received from any
Governmental Entity under the Antitrust Laws and to resolve the objections, if
any, that could be asserted by any Governmental Entity under Antitrust Laws with
respect to the transactions contemplated by this Agreement.

 

Section 5.4           Financing. Notwithstanding anything contained in this
Agreement to the contrary, the Purchaser expressly acknowledges and agrees that
the Purchaser’s obligations under this Agreement are not conditioned in any
manner whatsoever upon the Purchaser obtaining any financing and any failure to
fulfill any obligation under this Agreement arising from the failure of the
Purchaser to obtain financing or the unavailability of such financing will be
deemed to be intentional for purposes of this Agreement.

 

Section 5.5           Public Announcements. Each party agrees not to issue any
press release or make any other public announcement relating to this Agreement
without the prior written approval of the other party, except that each of the
Seller and the Purchaser reserves the right, without the other party’s prior
consent, to make any public disclosure it believes in good faith is required by
applicable securities Laws or securities listing standards (in which case the
disclosing party agrees to consult with the other party prior to making the
disclosure and allow the other party reasonable time to comment thereon prior to
issuance or release; provided, that, the disclosing party will consider the
other party’s comments in good faith, but it is not required to accept all
comments). Following execution and delivery of this Agreement, ARIAD US and the
Purchaser shall issue a joint press release substantially in the form set forth
in Exhibit C.

 

Section 5.6           Intragroup Agreements. The Seller shall terminate prior to
or effective as of the Closing all Intragroup Agreements (including the ARIAD
Intragroup Indebtedness), settle all outstanding financial obligations arising
thereunder and cause each Person party thereto to be unconditionally released
and irrevocably discharged from any and all further covenants, undertakings,
warranties and other obligations contained in such Intragroup Agreements.

 

Section 5.7           Carve Out Restructuring. Prior to the Closing, the Seller
shall transfer to a member of the Seller’s Group the Australian Business in
substantially the manner described in Section 5.7 of the Seller Disclosure
Schedule (the “Carve Out Restructuring”).

 

Section 5.8           Financial Statements. Prior to the Closing, the Seller
shall provide to the Purchaser an audited consolidated balance sheet for the
Company for each of the fiscal years ending December 31, 2015 and 2014
(collectively, the “Audited Consolidated Balance Sheets”) and the related
statements of income, changes in equity and cash flow, for each such fiscal year
(collectively, with the Audited Consolidated Balance Sheets, the “Audited
Consolidated Financial Statements”) and unaudited consolidated interim financial
statements for the Company for the

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 30

 

 

period ending March 31, 2016 (the “Other Consolidated Financial Statements”), in
each case prepared in accordance with the requirements of Regulation S-X of the
SEC and in form and substance sufficient to permit the Purchaser to comply with
its obligations under Item 9.01 of Form 8-K under the Exchange Act. The Seller
shall use commercially reasonable efforts to obtain all necessary auditor
reports and consents from the Seller’s independent auditors required by the SEC
to file such Audited Consolidated Financial Statements and Other Consolidated
Financial Statements with the SEC. The fees, costs and expenses incurred by the
Seller or its Affiliates in connection with the delivery of the Audited
Consolidated Financial Statements and any auditor reports or consents required
pursuant to this Section 5.8 shall reduce dollar-for-dollar the amount of the
current liabilities of the Acquired Companies for the purposes of calculating
Closing Net Working Capital.

 

Section 5.9           CSC Guarantee. The Purchaser and the Seller will use
commercially reasonable efforts to provide financial assurances reasonably
acceptable to CSC in substitution of the CSC Guarantee or to otherwise obtain
the full release of the CSC Guarantee, in each case at or prior to the Closing.
In the event that the CSC Guarantee is not substituted or released at or prior
to the Closing, (a) the Purchaser and the Seller will continue to use
commercially reasonable efforts to provide financial assurances reasonably
acceptable to CSC in substitution of the CSC Guarantee or to otherwise obtain
the full release of the CSC Guarantee as promptly as practicable and (b) until
such time as the CSC Guarantee is substituted or released, the Purchaser will
indemnify and hold harmless the Seller and its Affiliates (including ARIAD US)
against and from any and all Liabilities arising out of or relating to CSC
Guarantee.

 

Article 6
CONDITIONS PRECEDENT TO OBLIGATION TO CLOSE

 

Section 6.1           Joint Condition. The obligation of the Purchaser and the
Seller to consummate the transactions contemplated by this Agreement is subject
to the satisfaction, on or before the Closing Date, of the following condition
(any of which may be waived by the mutual agreement between the parties, in
whole or in part): there must not be in effect any Law or Judgment that would
prohibit or make illegal the consummation of the transactions contemplated by
this Agreement or cause the transactions contemplated by this Agreement to be
rescinded following consummation.

 

Section 6.2           Conditions to the Obligation of the Purchaser. The
obligation of the Purchaser to consummate the transactions contemplated by this
Agreement is subject to the satisfaction, on or before the Closing Date, of each
of the following conditions (any of which may be waived by the Purchaser, in
whole or in part):

 

(a)          The representations and warranties of the Seller in Article 3 must
be true and correct in all respects as at Closing (except to the extent any such
representation or warranty speaks as of the date of this Agreement or any other
specific date, in which case such representation or warranty must have been true
and correct in all respects as of such date), except where the failure of such
representations and warranties to be so true and correct (without regard for any
“material,” “Material Adverse Effect” or similar qualification) would not,
individually or in the aggregate, constitute a Material Adverse Effect;

 

(b)          All of the covenants and obligations that the Seller is required to
perform or comply with under this Agreement on or before the Closing Date must
have been duly performed and complied with in all material respects;

 

(c)          The Seller must have delivered or caused to be delivered each
document that Section 2.6(a) requires it to deliver;

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 31

 

 

(d)          The Required Contracts shall not have been amended, modified or
rescinded and shall be in full force and effect; and

 

(e)          There shall not have occurred any event or condition of any
character that has had, or is reasonably likely to have, a Material Adverse
Effect since the date of this Agreement.

 

Section 6.3           Conditions to the Obligation of the Seller. The obligation
of the Seller to consummate the transactions contemplated by this Agreement is
subject to the satisfaction, on or before the Closing Date, of each of the
following conditions (any of which may be waived by the Seller, in whole or in
part):

 

(a)          The representations and warranties of the Purchaser in Article 4
must be true and correct in all material respects as of the Closing (except to
the extent any such representation or warranty speaks as of the date of this
Agreement or any other specific date, in which case such representation or
warranty must have been true and correct in all material respects as of such
date);

 

(b)          All of the covenants and obligations that the Purchaser is required
to perform or comply with under this Agreement on or before the Closing Date
must have been duly performed and complied with in all material respects; and

 

(c)          The Purchaser must have delivered or caused to be delivered to the
Seller each document that Section 2.6(b) requires it to deliver.

 

Article 7
TERMINATION

 

Section 7.1           Termination Events. This Agreement may, by written notice
given before or at the Closing, be terminated:

 

(a)          by mutual consent of the Purchaser and the Seller;

 

(b)          by either the Purchaser or the Seller if any Governmental Authority
has issued a nonappealable final Judgment or taken any other nonappealable final
action, in each case having the effect of permanently restraining, enjoining or
otherwise prohibiting the transactions contemplated by this Agreement; provided,
however, that the right to terminate this Agreement under this Section 7.1(b)
will not be available to any party whose failure to fulfill any material
covenant under this Agreement, including the obligations of the Purchaser under
Section 5.3, has been the cause of or resulted in the action or event described
in this Section 7.1(b) occurring;

 

(c)          by the Purchaser if the Closing has not occurred (other than
through the failure of the Purchaser to comply fully with its obligations under
this Agreement) on or before June 30, 2016; or

 

(d)          by the Seller if the Closing has not occurred (other than through
the failure of the Seller or the Company to comply fully with its obligations
under this Agreement) on or before June 30, 2016.

 

Section 7.2           Effect of Termination. If this Agreement is terminated
pursuant to Section 7.1, this Agreement and all rights and obligations of the
parties under this Agreement automatically end without Liability against any
party or its Affiliates, except that (a) Section 12.1 (Confidentiality), Section
5.5 (Public Announcements), Section 7.3 (Certain Effects of Termination),
Article 13 (General Provisions) (except for Section 13.12 (Specific
Performance)) and this Section 7.2 will remain in full force and survive any
termination of this Agreement and (b) if this Agreement is terminated by a party
because of

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 32

 

 

the knowing and intentional breach of this Agreement by the other party or
because one or more of the conditions to the terminating party’s obligations
under this Agreement is not satisfied as a result of the other party’s knowing
and intentional failure to comply with its obligations under this Agreement, the
terminating party’s right to pursue all legal remedies will survive such
termination unimpaired.

 

Section 7.3           Certain Effects of Termination. If the Purchaser or the
Seller terminates this Agreement pursuant to Section 7.1, the Purchaser will
comply with the Confidentiality Agreement regarding the return and/or
destruction of any information furnished to the Purchaser in connection with
this Agreement.

 

Article 8
INDEMNIFICATION

 

Section 8.1           Indemnification by the Seller. If the Closing occurs, and
subject to the limitations expressly set forth in Section 8.4 and Section 8.5,
the Seller will indemnify and hold harmless the Purchaser and its directors,
officers, employees, agents, representatives, stockholders and Affiliates
(collectively, the “Purchaser Indemnified Parties”) from and against any and all
Losses (other than Losses with respect to Taxes, for which the provisions of
Section 9.2 will govern) incurred by the Purchaser Indemnified Parties arising
or resulting from (a) any breach of any representation or warranty set forth in
Article 3, (b) any breach of any covenant of the Purchaser set forth in this
Agreement, (c) any Indebtedness to the extent not taken into account in the
determination of the Final Closing Net Cash and (d) the Deferred Refund
Obligations. The amount of indemnified Losses will be determined without regard
to any “materiality” or “Material Adverse Effect” qualification contained in the
applicable provisions hereof.

 

Section 8.2           Indemnification by the Purchaser. If the Closing occurs,
and subject to the limitations expressly set forth in Section 8.4 and Section
8.5, the Purchaser will indemnify and hold harmless the Seller and its
directors, officers, employees, agents, representatives, stockholders and
Affiliates (collectively, the “Seller Indemnified Parties”) from and against any
and all Losses (other than Losses with respect to Taxes, for which the
provisions of Section 9.2(b) will govern) incurred by the Seller Indemnified
Parties arising or resulting from (a) any breach of any representation or
warranty set forth in Article 4 and (b) any breach of any covenant of the
Purchaser set forth in this Agreement. The amount of indemnified Losses will be
determined without regard to any “materiality” or “Material Adverse Effect”
qualification contained in the applicable provisions hereof.

 

Section 8.3           Claim Procedure.  

 

(a)          A party that seeks indemnity under this Article 8 (an “Indemnified
Party”) will give written notice (a “Claim Notice”) to the party from whom
indemnification is sought (an “Indemnifying Party”) whether the Losses sought
arise from matters solely between the parties or from Third Party Claims
described in Section 8.3(b). The Claim Notice must contain (i) a description
and, if known, the estimated amount of any Losses incurred or reasonably
expected to be incurred by the Indemnified Party, (ii) a reasonable explanation,
accompanied by reasonable supporting documentation, of the basis for the Claim
Notice to the extent of the facts then known by the Indemnified Party and (iii)
a demand for payment of those Losses.

 

(b)          If the Indemnified Party seeks indemnity under this Article 8 in
response to a claim or Proceeding by another Person not a party to this
Agreement (a “Third Party Claim”), then the Indemnified Party will give a Claim
Notice to the Indemnifying Party within ten days after the Indemnified Party has
received notice or otherwise learns of the assertion of such Third Party Claim
and will include in the

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 33

 

 

Claim Notice (i) the facts constituting the basis for such Third Party Claim and
the amount of the damages claimed by the other Person, in each case to the
extent known to the Indemnified Party, accompanied by reasonable supporting
documentation submitted by such third party (to the extent then in the
possession of the Indemnified Party) and (ii) the assertion of the claim or the
notice of the commencement of any Proceeding relating to such Third Party Claim;
provided, however, that no delay or deficiency on the part of the Indemnified
Party in so notifying the Indemnifying Party will relieve the Indemnifying Party
of any Liability under this Agreement except to the extent such delay or
deficiency prejudices or otherwise adversely affects the rights of the
Indemnifying Party with respect thereto.

 

(c)          The Indemnifying Party will have 30 days after receipt of notice of
such Third Party Claim to elect to assume control of the defense of such Third
Party Claim with counsel reasonably satisfactory to the Indemnified Party by
giving to the Indemnified Party written notice of the intention to assume
control of such defense. If the Indemnifying Party elects not to assume control
of such defense, the Indemnified Party will control such defense.

 

(d)          The party not controlling the defense of the Third Party Claim (the
“Non-controlling Party”) may participate in the defense thereof at its own
expense. However, if the Indemnifying Party assumes control of such defense as
permitted above and, based upon the reasonable opinion of counsel to the
Indemnified Party reasonably acceptable to the Indemnifying Party, a conflict or
potential conflict of interest exists between the Indemnified Party and the
Indemnifying Party which makes the representation of both parties inappropriate
under applicable standards of professional conduct, then the reasonable fees and
expenses of counsel to the Indemnified Party will be considered and included as
“Losses” for purposes of this Agreement. The Non-controlling Party will furnish
the party controlling the defense of the Third Party Claim (the “Controlling
Party”) with such information as it may have with respect to the Third Party
Claim (including copies of any summons, complaint or other pleading which may
have been served on such party and any written claim, demand, invoice, billing
or other document evidencing or asserting the same) and will otherwise cooperate
with and assist the Controlling Party and its counsel in the defense of such
Third Party Claim. The Controlling Party will keep the Non-controlling Party
reasonably advised of the status of such Third Party Claim and will consider in
good faith recommendations made by the Non-controlling Party with respect
thereto.

 

(e)          The Indemnifying Party will not agree to any settlement of, or
consent to the entry of any Judgment (other than a Judgment of dismissal on the
merits without costs) arising from, any such Third Party Claim without the prior
written consent of the Indemnified Party; provided, however, that the consent of
the Indemnified Party will not be required if the Indemnifying Party agrees in
writing to pay any amounts payable pursuant to such settlement or any Judgment
and such settlement or Judgment includes a full, complete and unconditional
release of the Indemnified Party from further Liability. The Indemnified Party
will not agree to any settlement of, or the entry of any Judgment (other than a
Judgment of dismissal on the merits without costs) arising from, any such Third
Party Claim without the prior written consent of the Indemnifying Party.

 

Section 8.4           Survival. Other than the Seller Fundamental
Representations and the representations and warranties set forth in Section 3.13
(Tax Matters), all representations and warranties contained in this Agreement
will survive the Closing until the twelve-month anniversary of the Closing Date.
The Seller Fundamental Representations and the representations and warranties
set forth in Section 3.13 (Tax Matters) will survive the Closing until sixty
days after the expiration of the applicable statute of limitations. None of the
covenants or other agreements contained in this Agreement shall survive the
Closing Date other than those which by their terms contemplate performance after
the Closing Date, and each such surviving covenant and agreement shall survive
the Closing for the period contemplated by its terms or in accordance with the
applicable statute of limitations with respect thereto, whichever is shorter.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 34

 

 

All claims for indemnification under this Agreement must be asserted pursuant to
a Claim Notice given prior to the expiration of the applicable survival period
set forth in this Section 8.4; provided, however, that any representation,
warranty or covenant that is the subject of a claim for indemnification which is
asserted pursuant to a Claim Notice given after the Closing Date within the
survival period specified in this Section 8.4 will survive until, but only for
purposes of, the resolution of such claim.

 

Section 8.5           Limitations on Liability.

 

(a)          Notwithstanding anything to the contrary contained in this
Agreement:

 

(i)          no indemnification payments will be made by or on behalf of an
Indemnifying Party in respect of any breaches of representations and warranties
made by such party, as applicable, under this Agreement (other than with respect
to Seller Fundamental Representations) until the aggregate amount of Losses for
which such Indemnifying Party would (but for this clause) be liable thereunder
exceeds 1% of the Initial Purchase Price, in which event the Indemnifying Party
will be liable for all Losses from the first dollar;

 

(ii)         the aggregate total amount for which an Indemnifying Party will be
liable to indemnify and hold harmless the Indemnified Parties with respect to
any breaches of representations and warranties made by the Indemnifying Party
under this Agreement (other than with respect to Seller Fundamental
Representations) will not exceed 10% of the Initial Purchase Price;

 

(iii)        the aggregate total amount for which an Indemnifying Party will be
liable to indemnify and hold harmless the Indemnified Parties under this
Agreement will not exceed the Initial Purchase Price; and

 

(iv)        any indemnity provided hereunder shall be so applied as to avoid any
double counting and no Indemnified Party shall be entitled to obtain
indemnification more than once for the same matter or Losses.

 

(b)          An Indemnified Party’s right to indemnification or other remedies
based upon the representations, warranties, covenants and agreement of the
Indemnifying Party contained in this Agreement will not be affected or deemed
waived by reason of the fact that the Indemnified Party, based solely upon its
own investigation and without regard to any information provided by the
Indemnifying Party, knew or should have known that any representation or
warranty might be inaccurate or that the Indemnifying Party filed to comply with
any agreement or covenant.

 

The limitations on liability set forth in this Section 8.5 shall not apply to
Losses resulting from fraud with respect to any breach of any representation or
warranty or willful breach with respect to any covenant, in each case as
contained in this Agreement.

 

Section 8.6           Tax Refunds, Insurance Proceeds and Other Payments. The
amount of any and all Losses for which indemnification is provided pursuant to
this Article 8 or Article 9 will be net of any Tax benefit to which an
Indemnified Party is entitled by reason of payment of such Liability and any
amounts of any insurance proceeds, indemnification payments, contribution
payments or reimbursements receivable by, or payable in kind to, the Indemnified
Party with respect to such Losses or any of the circumstances giving rise
thereto. In connection therewith, if, at any time following payment in full by
the Indemnifying Party of any amounts of Losses due under this Agreement, the
Indemnified Party receives any insurance proceeds, indemnification payments,
contribution payments or reimbursements relating to

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 35

 

 

the circumstances giving rise to such Losses, the Indemnified Party will
promptly remit to the Indemnifying Party such proceeds, payments or
reimbursements in an amount not to exceed the amount of the corresponding
indemnification payment made by the Indemnifying Party. The Purchaser will use
(and will cause its Affiliates to use) commercially reasonable efforts to
collect the proceeds of any available insurance which would have the effect of
reducing any Losses (in which case the net proceeds thereof will reduce the
Losses).

 

Section 8.7           Subrogation. If the Purchaser or any Purchaser Indemnified
Party is indemnified for any Losses pursuant to this Agreement with respect to
any claim by a Person not party to this Agreement, then the Seller will be
subrogated to all rights and remedies of the Purchaser or the Purchaser
Indemnified Party against such third party, and the Purchaser will, and will
cause each of the Purchaser Indemnified Parties to, cooperate with and assist
the Seller in asserting all such rights and remedies against such third party.

 

Section 8.8           Exclusive Remedy From and after the Closing, except for
the availability of injunctive or other equitable relief and claims relating to
fraud, the sole and exclusive remedy of the Purchaser for any matter arising out
of the transactions contemplated by this Agreement will be pursuant to the
indemnification obligations set forth in Article 8 and Article 9 and, except to
the extent the Purchaser has asserted a claim for indemnification by giving a
Claim Notice in accordance with Section 8.3 prior to the expiration of the
applicable survival period set forth in Section 8.4, the Purchaser will have no
remedy against the Seller for any breach of any provision of this Agreement. In
no event will the Seller have any Liability for Losses arising from the conduct
of the business of the Acquired Companies after the Closing.

 

Article 9
TAX MATTERS

 

Section 9.1           Swiss Tax Rulings.

 

(a)          As soon as reasonably practicable and in any event within thirty
days following the execution and delivery of this Agreement, the Seller shall
prepare and file with the Swiss Tax Authorities the requests for tax rulings
listed in Section 9.1(a) of the Seller Disclosure Schedule with respect to the
applicable federal stamp tax and or income or withholding tax that may arise as
a result of the Pre-Sale Restructuring (the “Swiss Tax Rulings”).

 

(b)          The Seller and the Purchaser will each use their respective
reasonable best efforts to take, or cause to be taken, all actions and to do, or
cause to be done, all things necessary, proper or advisable to obtain the Swiss
Tax Rulings. Subject to this Section 9.1(b), the Seller will control and be
responsible for the filing of the Swiss Tax Rulings and the submission of any
information, documentation, responses or communication with the Swiss Tax
Authority relating thereto. The parties will provide to each other such
assistance, information and cooperation as is reasonably required to obtain the
Swiss Tax Rulings (including providing necessary information, assisting in
responding to any inquiries and attending meetings with the applicable Swiss Tax
Authority) and, in connection therewith, each party will (i) promptly notify the
other party of any material communication between such party and any Swiss Tax
Authority relating to the Swiss Tax Rulings; (ii) consult with the other party
in advance of participating in any meeting or discussion with any Swiss Tax
Authority relating to the Swiss Tax Rulings and, to the extent permitted by such
Swiss Tax Authority, give the other party (and its counsel and tax advisors) the
opportunity to attend and participate thereat; and (iii) subject to applicable
Law, discuss with and permit the other party (and its counsel and tax advisors)
to review in advance, and consider in good faith the other party’s reasonable
comments in connection with, any proposed filing, submission or

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 36

 

 

communication to any Swiss Tax Authority relating to the Swiss Tax Rulings. For
the avoidance of doubt, the provisions of this Section 9.1(b) shall govern with
respect to the interactions of the parties with the Swiss Tax Authority in
connection with the Swiss Tax Ruling and Section 5.3(c) will not apply to the
matters addressed in this Section 9.1(b).

 

Section 9.2           Liability and Indemnification for Taxes.

 

(a)          If the Closing occurs, and subject to Section 8.5(a)(iii) and the
limitations expressly set forth in Section 9.2(d), and except to the extent any
Taxes are reserved or accrued on the Closing Balance Sheet, the Seller will
indemnify the Purchaser Indemnified Parties against: (i) all Losses for all
Taxes of the Acquired Companies that are attributable to the Pre-Closing Period
or as a result of the Pre-Sale Restructuring or Carve-out Restructuring, and
(ii) all Losses for all Taxes attributable to any breach of the Company’s
representations and warranties set forth in Section 3.13.

 

(b)          If the Closing occurs, the Purchaser will indemnify the Seller
Indemnified Parties against all Losses (i) for all Taxes of the Acquired
Companies that are attributable to any Post-Closing Period, except to the extent
that such Losses for Taxes are attributable to any breach of the Company’s
representations and warranties set forth in Section 3.13 and (ii) for all Taxes
arising solely out of or due to any breach of any covenant of the Purchaser set
forth in this Agreement.

 

(c)          With respect to any Straddle Period, any Losses for Taxes will be
allocated between the Pre-Closing Period and the Post-Closing Period by closing
the books of the Acquired Companies at the end of the Closing Date, except that
(i) Tax items of a periodic nature, such as property taxes or depreciation
allowances calculated on an annual basis, will be allocated by apportioning a
pro-rata portion of such Taxes to each day in the relevant Straddle Period, and
(ii) Liabilities relating to Tax associated with the Pre-Sale Restructuring will
fall into the Pre-Closing Period.

 

(d)          The Seller will not be required to indemnify the Purchaser
Indemnified Parties for reductions in any Tax Attributes. The Seller will not be
required to indemnify the Purchaser Indemnified Parties against Losses for Taxes
attributable to the Pre-Closing Period or the Pre-Sale Restructuring or
Carve-out Restructuring to the extent such Losses for Taxes could be reduced
under applicable Law by reason of net operating loss carryovers, Tax credits and
similar Tax attributes arising in the Pre-Closing Period (assuming for the
purposes of this sentence that such attributes are not used to reduce Taxes in
the Post-Closing Period).

 

Section 9.3           Tax Return Filing; Audit Responsibilities.  

 

(a)          Except as set forth in Section 9.3(b), the Purchaser will control
and be responsible for the filing of all Tax Returns required to be filed with
respect to the Company after the Closing Date. All such Tax Returns will be
completed in accordance with past practice to the extent permitted by applicable
Law. The Purchaser will make all payments required with respect to any such Tax
Return.

 

(b)          The Seller will control and be responsible for the preparation and
filing of all Tax Returns due after the Closing Date that relate to the Company
or any Affiliate of the Company and are Affiliated Group Tax Returns which
include Pre-Closing Period operations. All such Tax Returns will be completed in
accordance with past practice to the extent permitted by applicable Law. The
Seller will make all payments required with respect to any such Tax Return.

 

(c)          In the event that the Seller or the Purchaser is liable under this
Agreement for any Taxes paid by the other party with respect to any Tax Return,
prompt reimbursement will be made.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 37

 

 

(d)          If the Purchaser receives notice of a Tax Contest with respect to
any Acquired Company which could reasonably be expected to cause the Seller to
have an indemnification obligation under this Article 9, then the Purchaser will
notify the Seller in writing of such Tax Contest within five Business Days of
receiving such notice. The Seller will have the right to control the conduct and
resolution of such Tax Contest; provided, however, that the Seller may decline
to participate in such Tax Contest. If the Seller controls the conduct of such
Tax Contest, the Seller will not resolve such Tax Contest, to the extent such
Tax Contest relates to Post-Closing Period Taxes, without the Purchaser’s
written consent, which consent will not be unreasonably withheld, conditioned or
delayed. If the Seller declines to control such Tax Contest, then the Purchaser
will have the right to control the conduct of such Tax Contest; provided,
however, that the Purchaser will not resolve such Tax Contest without the
Seller’s written consent, which consent will not be unreasonably withheld,
conditioned or delayed. Each party will bear its own costs for participating in
such Tax Contest.

 

(e)          Any net refunds and credits attributable to the payment of Taxes
for a Pre-Closing Period will be for the account of the Seller, and the
Purchaser will promptly pay to the Seller any such refund or credit.

 

(f)          To the extent not inconsistent with the provisions of this Section
9.3, the procedures of Article 8 will apply in the case of any claim for Losses
related to Taxes.

 

Section 9.4           Cooperation. Each of the Seller and the Purchaser agree
that it will:

 

(a)          provide assistance to the other party as reasonably requested in
preparing and filing Tax Returns and responding to Tax Contests;

 

(b)          make available to the other party as reasonably requested all
information, records, and documents relating to Taxes concerning the Acquired
Companies; and

 

(c)          retain any books and records that could reasonably be expected to
be necessary or useful in connection with any preparation by any other party of
any Tax Return or for any Tax Contest or other examination or Proceeding
relating to Taxes. Such books and records will be retained until the expiration
of the applicable statute of limitations (including extensions thereof).
Thereafter, the Purchaser will not dispose of any such Tax Returns, books and
records unless it first offers in writing such Tax Returns, books and records to
the Seller and the Seller fails to accept such offer within 60 days of it being
made.

 

Section 9.5           No Code Section 338 Election. Neither the Purchaser, the
Company, nor any of their Affiliates will make any election under Section 338 of
the Code with respect to the transactions contemplated by this Agreement.

 

Section 9.6           Tax Treatment of Indemnity Payments. Any indemnity payment
under this Agreement shall be treated as an adjustment to the Purchase Price for
Tax purposes unless otherwise required by applicable Tax Law. Each party shall
notify the other party if it receives notice that any Governmental Authority
proposes to treat any indemnification payment as other than an adjustment to the
Purchase Price for Tax purposes, or if it otherwise determines that an
indemnification payment is required by applicable Tax Law to be treated as other
than an adjustment to the Purchase Price for Tax purposes.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 38

 

 

Article 10
EMPLOYEE MATTERS

 

Section 10.1         Employees.  

 

(a)          For the one-year period commencing on the Closing Date (or such
longer period as may be required by applicable Law) (the “Continuation Period”),
the Purchaser will provide, or cause the Acquired Companies to provide, those
employees employed by any Acquired Company at Closing, including those employees
on vacation, leave of absence, disability (including long-term disability),
military, parental or sick leave or layoff (whether or not such employees return
to active employment with the Acquired Company) (the “Transferred Employees”),
with employee benefits that in the aggregate are substantially equivalent to,
and no less favorable than, those provided to such Transferred Employees
immediately prior to the Closing, subject to any variations agreed with such
Transferred Employees. During the Continuation Period or such longer period as
may be required under the terms of any applicable employee benefit plan or
arrangement, the Purchaser will continue to provide, or cause the Acquired
Companies to provide, those former employees of any Acquired Company who left
employment prior to the Closing and who retain a benefit in any applicable
Company Plan (the “Transferred Former Employees”) and their dependents,
beneficiaries and join annuitants, with employee/retiree benefits that in the
aggregate are substantially equivalent to, and no less favorable than, the
benefits to which such Transferred Former Employees were entitled under the
Company Plans in effect immediately prior to the Closing, subject to any
variations agreed with such Employees. These obligations are not intended to
limit any provisions of applicable Law or Contracts which are more favorable to
Transferred Employees or Transferred Former Employees.

 

(b)          To the extent that service is relevant for purposes of eligibility,
vesting or benefit accrual under any employee benefit plan, program or
arrangement established or maintained by the Purchaser for the benefit of
Transferred Employees or Transferred Former Employees, such plan, program or
arrangement will credit such employees or former employees for service on or
prior to the Closing with the Acquired Companies and their Affiliates.

 

(c)          Upon the Closing Date, the Purchaser will honor or cause the
Acquired Companies to honor in accordance with their terms all individual
employment, severance, retention and other compensation agreements then existing
between the Acquired Companies and any employee, director or officer thereof,
except as otherwise agreed in writing by the Purchaser and such Person.

 

(d)          Promptly after the execution and delivery of this Agreement, the
Purchaser and the Seller will cooperate in good faith to prepare a written
communication to the Transferred Employees and written guidance for any verbal
communications by or on behalf of either party to the Transferred Employees
regarding the employee benefits (including equity compensation arrangements) to
be provided to the Transferred Employees by the Acquired Companies following the
Closing.

 

(e)          The Purchaser shall cause the applicable Retention Payment to paid
to each individual identified on Schedule 1.1(c) to the Seller Disclosure
Schedules on the first regularly scheduled payroll date for such individual
following the Closing Date.

 

Section 10.2         Indemnity. From and after the Closing and subject to
Sections 8.3 and 8.5(a)(iii), the Purchaser will indemnify and hold harmless the
Seller Indemnified Parties against all Losses that are incurred from and after
the Closing arising or resulting from (a) any Company Plan maintained or
sponsored directly by any Acquired Company that transfers with the Acquired
Companies by operation of Law, (b) any claim with respect to any Company Plan
which transfers in whole, or in part, by operation of

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 39

 

 

this Article 10 and (c) any failure of the Purchaser to discharge its
obligations under this Article 10.

 

Article 11
POST-CLOSING COVENANTS

 

Section 11.1         Confidentiality.

 

(a)          The parties agree to continue to abide by that certain
Confidentiality Agreement between ARIAD US and Purchaser dated January 19, 2016
(the “Confidentiality Agreement”), which will survive until the Closing, at
which time the Confidentiality Agreement will terminate; provided, however, that
if this Agreement is, for any reason, terminated prior to the Closing, the
Confidentiality Agreement will continue in full force and effect in accordance
with its terms.

 

(b)          For a period of [***] years after the Closing, the Seller will, and
will instruct its Representatives to, hold in confidence, unless compelled to
disclose by judicial or administrative process or by other requirements of Law,
all non-public documents and information to the extent relating to the Acquired
Companies (the “Company Information”), except to the extent that such the
Company Information (i) must be disclosed in connection with the obligations of
the Seller pursuant to this Agreement or any Ancillary Agreement, (ii) can be
shown to have been in the public domain through no fault of the Seller or (iii)
was later lawfully acquired by the Seller from sources other than those related
to its prior ownership of the Acquired Companies. Notwithstanding the foregoing,
in no event will this Section 12.1(b) limit or otherwise restrict the right of
the Seller to disclose such the Company Information (w) to its and its
Affiliates’ respective Representatives to the extent reasonably required to
facilitate the negotiation, execution, delivery or performance of this Agreement
and the Ancillary Agreements, (x) to any Governmental Authority or arbitrator to
the extent reasonably required in connection with any Proceeding relating to the
enforcement of this Agreement or any Ancillary Agreement, (y) in connection with
its indemnification obligations under this Agreement, including the defense of
any Third Party Claim, and (z) as permitted in accordance with Section 5.5.

 

Section 11.2         Indemnification. The Purchaser will not, for a period of
six years after the Closing, take or permit any action to alter or impair any
exculpatory or indemnification provisions now existing in the Organizational
Documents of any Acquired Company for the benefit of any individual who served
as a director or officer of any Acquired Company at any time prior to the
Closing (each an “Affiliate Indemnified Party”), except for any changes which
may be required to conform with changes in applicable Law and any changes which
do not affect the application of such provisions to acts or omissions of such
individuals prior to the Closing. Without limiting the generality of this
Section 12.2, the provisions of this Section 12.2 are intended for the benefit
of, and may be enforced by, each of the Affiliate Indemnified Parties and their
respective heirs.

 

Section 11.3         Seller’s Group Marks.

 

(a)          As soon as practicable after Closing, and in any event by no later
than the date falling six months following the Closing Date, remove all Seller’s
Group Marks from, or otherwise destroy, all sales or promotional materials,
stationery, buildings, signage, vehicles or internet websites in its possession
or control bearing any Seller’s Group Marks.

 

(b)          As soon as practicable after Closing, and in any event by no later
than the date falling six months following the Closing Date, change the name of
all Acquired Companies so that it no longer includes any Seller’s Group Marks.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 40

 

 

Section 11.4         Standstill.

 

(a)          Except as permitted by Section 12.4(b), for a period of [***]
following the execution and delivery of this Agreement, without the prior
written consent of the Board of Directors of ARIAD US, no Controlled Person
shall (or assist or encourage others to) directly or indirectly in any manner:
(i) acquire, announce an intention to acquire, or agree to acquire, directly or
indirectly, alone or in concert with others, by purchase, gift or otherwise, any
direct or indirect beneficial ownership (within the meaning of Rule 13d-3 under
the Exchange Act) or interest in any securities or direct or indirect rights,
warrants or options to acquire, or securities convertible into or exchangeable
for, any securities of ARIAD US; (ii) make, or in any way participate in,
directly or indirectly, alone or in concert with others, any “solicitation” of
“proxies” to vote (as such terms are used in the proxy rules of the SEC
promulgated pursuant to Section 14 of the Exchange Act) any securities of ARIAD
US with respect to any business combination, restructuring, recapitalization or
similar transaction; (iii) form, join or in any way participate in a “group”
within the meaning of Section 13(d)(3) of the Exchange Act with respect to any
voting securities of ARIAD US; (iv) acquire, announce an intention to acquire,
or agree to acquire, directly or indirectly, alone or in concert with others, by
purchase, exchange or otherwise, (x) any of the assets, tangible or intangible,
of ARIAD US or (y) direct or indirect rights, warrants or options to acquire any
assets of ARIAD US, other than in the ordinary course of business; (v) enter
into any arrangement or understanding with others to do any of the actions
restricted or prohibited under clauses (i), (ii), (iii) or (iv) of this Section
12.4(a); (vi) otherwise act in concert with others, to seek to offer to ARIAD US
or any of its stockholders any business combination, restructuring,
recapitalization or similar transaction to or with ARIAD US, or (vii) take any
action to control or influence the management, Board of Directors or policies of
ARIAD US.

 

(b)          The provisions of Section 12.4(a) shall not apply (i) in the event
that ARIAD US announces publicly that it is seeking purchasers for ARIAD US,
(ii) upon the commencement by a third party of a tender or exchange offer for
more than 50% of the voting power of the outstanding voting securities of ARIAD
US, provided that if such third party withdraws its tender or exchange offer,
Section 11.4(a) shall again apply as of the date of such withdrawal, (iii) if a
third party acquires beneficial ownership of more than 20% of the outstanding
common stock of ARIAD US, (iv) if ARIAD US publicly announces a transaction, or
an intention to effect any transaction, which would result in (A) the sale by
ARIAD US or one or more of its subsidiaries to a third party of assets
representing more than 50% of the consolidated earning power or assets of ARIAD
US and its subsidiaries, (B) the common shareholders of ARIAD US immediately
prior to such transaction owning less than 50% of the outstanding common stock
of the acquiring entity or, in the case of a merger transaction, the surviving
corporation (or, if the surviving corporation is a subsidiary of a parent
company, the parent company) or (C) a third party acquiring beneficial ownership
of more than 20% of the outstanding common stock of ARIAD US. For clarity, the
foregoing provisions shall prohibit the Controlled Persons from acquiring shares
of common stock of ARIAD US pursuant to a public tender offer for all
outstanding common stock of ARIAD US in consideration for cash unless one of the
exceptions in the preceding sentence applies. Notwithstanding the above,
cumulative acquisitions by the Controlled Persons of less than [***] of ARIAD
US’s outstanding common shares shall not be deemed a breach of this provision.

 

(c)          Nothing in this Section 11.4 shall prevent a Controlled Person from
privately approaching ARIAD US to make an offer for the acquisition solely by
the Controlled Persons of ARIAD US or any assets of ARIAD US, including ARIAD
US’s rights to Products; provided that, (i) in the event ARIAD US does not
accept any such offer, no Controlled Person shall take any action in
contravention of Section 11.4(a), which shall continue to apply in all respects
in accordance with the provision thereof and (ii) no Controlled Person shall
make any public announcement regarding any such private approach by a

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 41

 

 

Controlled Person or otherwise take any action that would reasonably require
ARIAD US to make a public announcement regarding such offer or any of the types
of matters set Section 11.4(a).

 

Section 11.5         Further Actions. Subject to the other express provisions of
this Agreement, upon the request of any party to this Agreement, the other
parties will execute and deliver such other documents, instruments and
agreements as the requesting party may reasonably require for the purpose of
carrying out the intent of this Agreement and the transactions contemplated by
this Agreement.

 

Section 11.6         Books and Records and Cooperation with Litigation. 

 

(a)          As soon as reasonably practical after the Closing, and in no event
later than 30 days after the Closing Date, the Seller shall, or shall cause its
Affiliates to, deliver to the Purchaser or an Affiliate of the Purchaser as
directed in writing by the Purchaser all Books and Records not kept at the
Leased Real Properties.

 

(b)          For a period of six years after the Closing Date or such longer
time as may be required by Law (i) the Purchaser shall not, and shall cause its
Affiliates not to, intentionally dispose of or destroy any of the Books and
Records without first offering to turn over possession thereof to the Seller by
written notice to the Seller at least 60 days prior to the proposed date of such
disposition or destruction and (ii) upon reasonable advance notice, the
Purchaser shall, and shall cause its Affiliates to, give the Seller and its
Representatives reasonable access, during normal business hours and without
unreasonable interruption of the Purchaser’s business, to, at the Seller’s sole
cost and expense, make copies of any Books and Records at reasonable times at
the Purchaser’s principal place of business or at any location where any Books
and Records are stored. The provisions of Section 11.6(b)(i) shall not prohibit
or restrict, and shall not require the Purchaser to provide any notice to the
Seller in connection with, the deletion of electronic mail messages or other
information stored in an electronic format in the ordinary course of business in
a manner consistent with the Purchaser’s electronic records retention policies
and applicable Law. The Seller’s access to the Books and Records after the
Closing Date pursuant to Section 11.6(b)(ii) shall be limited to access that is
reasonably required to permit the Seller to comply with its financial and Tax
reporting obligations, to defend against any Proceeding or claim by a Third
Party in which the Seller or its Affiliates are involved relating to or in
connection with the Acquired Companies, or otherwise to comply with any
requirement of applicable Law, in each case, subject to the Purchaser’s
reasonable policies restricting access by Third Parties to the Purchaser’s and
its Affiliates’ (including, following the Closing, the Acquired Companies’)
information technology systems or assets.

 

(c)          For a period of six years after the Closing Date, each of the
Purchaser and the Seller shall, and shall cause its Affiliates to, make
available upon reasonable advance notice and at reasonable times upon written
request any personnel whose assistance or participation is reasonably required
in anticipation of, or preparation for, existing or future Proceedings or claims
by a Third Party in which such party or any of its Affiliates are involved
relating to or in connection with the Acquired Companies.

 

(d)          The requesting party shall reimburse the other party for its
reasonable out-of-pocket expenses incurred in performing the covenants contained
in this Section 11.6.

 

Article 12
GENERAL PROVISIONS

 

Section 12.1         Notices. All notices and other communications under this
Agreement must be in writing and are deemed duly delivered when (a) delivered if
delivered personally or by nationally recognized overnight courier service
(costs prepaid), (b) sent by facsimile with confirmation of

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 42

 

 

transmission by the transmitting equipment (or, the first Business Day following
such transmission if the date of transmission is not a Business Day) or (c)
received or rejected by the addressee, if sent by United States of America
certified or registered mail, return receipt requested; in each case to the
following addresses or facsimile numbers and marked to the attention of the
individual (by name or title) designated below (or to such other address,
facsimile number or individual as a party may designate by notice to the other
parties):

 

If to the Seller or ARIAD US:

 

ARIAD Pharmaceuticals, Inc.

26 Landsdowne Street

Cambridge, MA 02139

Facsimile:     [***]

Attention:    Chief Executive Officer

                      Chief Legal Officer

 

with a copy (which will not constitute notice) to:

 

Baker & McKenzie LLP

100 New Bridge Street

London, EC4V 6JA

United Kingdom

Facsimile:     [***]

Attention:    Jane Hobson

 

and

 

Baker & McKenzie LLP
300 East Randolph Street, Suite 5000
Chicago, Illinois 60601
United States of America
Facsimile:     [***]
Attention:    Andrew J. Warmus

 

If to the Purchaser or Incyte US:

 

Incyte Corporation

1801 Augustine Cut-Off

Wilmington, DE 19803

United States of America

Facsimile:     [***]

Attention:    General Counsel

 

with a copy (which will not constitute notice) to:

 

Morgan, Lewis & Bockius LLP

502 Carnegie Center

Princeton , NJ 08540

United States of America

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 43

 

 

Facsimile:     [***]

Attention:     Randall Sunberg

                     Emilio Ragosa

 

Section 12.2         Amendment. this Agreement may not be amended, supplemented
or otherwise modified except in a written document signed by each party to be
bound by the amendment and that identifies itself as an amendment to this
Agreement.

 

Section 12.3         Waiver and Remedies. The parties may (a) extend the time
for performance of any of the obligations or other acts of any other party to
this Agreement, (b) waive any inaccuracies in the representations and warranties
of any other party to this Agreement contained in this Agreement or (c) waive
compliance with any of the covenants or conditions for the benefit of such party
contained in this Agreement. (i) any such extension or waiver by any party to
this Agreement will be valid only if set forth in a written document signed on
behalf of the party or parties against whom the extension or waiver is to be
effective; (ii) no extension or waiver will apply to any time for performance,
inaccuracy in any representation or warranty, or noncompliance with any covenant
or condition, as the case may be, other than that which is specified in the
written extension or waiver; and (iii) no failure or delay by any party in
exercising any right or remedy under this Agreement or any of the documents
delivered pursuant to this Agreement, and no course of dealing between the
parties, operates as a waiver of such right or remedy, and no single or partial
exercise of any such right or remedy precludes any other or further exercise of
such right or remedy or the exercise of any other right or remedy. Except as
provided in Section 8.8, any enumeration of a party’s rights and remedies in
this Agreement is not intended to be exclusive, and a party’s rights and
remedies are intended to be cumulative to the extent permitted by law and
include any rights and remedies authorized in law or in equity.

 

Section 12.4         Entire Agreement. This Agreement (including the Schedules
and Exhibits hereto and the documents and instruments referred to in this
Agreement that are to be delivered at the Closing) constitutes the entire
agreement among the parties and supersedes any prior understandings, agreements
or representations by or among the parties, or any of them, written or oral,
with respect to the subject matter of this Agreement. Notwithstanding the
foregoing, the Confidentiality Agreement will remain in effect in accordance
with its terms as modified pursuant to Section 12.1.

 

Section 12.5         Assignment, Successors and No Third Party Rights. This
Agreement binds and benefits the parties and their respective successors and
assigns, except that the Purchaser may not assign any rights under this
Agreement, whether by operation of law or otherwise, without the prior written
consent of the Seller. No party may delegate any performance of its obligations
under this Agreement, except that the Purchaser may at any time delegate the
performance of its obligations (other than the obligation to pay the Purchase
Price) to any Affiliate of the Purchaser so long as the Purchaser remains fully
responsible for the performance of the delegated obligation. Nothing expressed
or referred to in this Agreement will be construed to give any Person, other
than the parties to this Agreement, any legal or equitable right, remedy or
claim under or with respect to this Agreement or any provision of this Agreement
except such rights as may inure to a successor or permitted assignee under this
Section 12.5.

 

Section 12.6         Severability. If any provision of this Agreement is held
invalid, illegal or unenforceable, the remaining provisions of this Agreement
remain in full force and effect, if the essential terms and conditions of this
Agreement for each party remain valid, binding and enforceable.

 

Section 12.7         Exhibits and Schedules. The Exhibits and Schedules to this
Agreement are incorporated herein by reference and made a part of this
Agreement. The Seller Disclosure Schedule and

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 44

 

 

the Purchaser Disclosure Schedule are arranged in sections and paragraphs
corresponding to the numbered and lettered sections and paragraphs of Article 3
and Article 4, respectively. The disclosure in any section or paragraph of the
Seller Disclosure Schedule, and those in any amendment or supplement thereto,
qualifies other sections and paragraphs in this Agreement to the extent it is
reasonably apparent that a given disclosure is applicable to such other sections
and paragraph.

 

Section 12.8         Interpretation. In the negotiation of this Agreement, each
party has received advice from its own attorney. The language used in this
Agreement is the language chosen by the parties to express their mutual intent,
and no provision of this Agreement will be interpreted for or against any party
because that party or its attorney drafted the provision.

 

Section 12.9         Expenses. Except as set forth in this Agreement, whether or
not the transactions contemplated by this Agreement are consummated, each party
will pay its own direct and indirect expenses incurred by it in connection with
the preparation and negotiation of this Agreement and the consummation of the
transactions contemplated by this Agreement, including all fees and expenses of
its Representatives.

 

Section 12.10         Governing Law. Unless any Exhibit or Schedule specifies a
different choice of law, the internal laws of the State of New York (without
giving effect to any choice or conflict of law provision or rule that would
cause the application of laws of any other jurisdiction) govern all matters
arising out of or relating to this Agreement and its Exhibits and Schedules and
the transactions contemplated by this Agreement, including its validity,
interpretation, construction, performance and enforcement and any disputes or
controversies arising therefrom or related thereto.

 

Section 12.11         Limitation on Liability. NOTWITHSTANDING ANY OTHER
PROVISION OF THIS AGREEMENT OR ANY ANCILLARY AGREEMENT TO THE CONTRARY, IN NO
EVENT WILL ANY PARTY OR ANY OF ITS AFFILIATES BE LIABLE FOR ANY SPECIAL,
INCIDENTAL, INDIRECT, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES (INCLUDING
LOST PROFITS, LOSS OF REVENUE OR LOST SALES) IN CONNECTION WITH ANY CLAIMS,
LOSSES, DAMAGES OR INJURIES ARISING OUT OF THE CONDUCT OF SUCH PARTY PURSUANT TO
THIS AGREEMENT REGARDLESS OF WHETHER THE NONPERFORMING PARTY WAS ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES OR NOT.

 

Section 12.12         Specific Performance. The parties agree that irreparable
damage would occur and the parties would have no adequate remedy at Law in the
event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. The parties
accordingly agree that, prior to the termination of this Agreement pursuant to
Section 7.1, in addition to any other remedy to which a party is entitled at law
or in equity, such party is entitled to injunctive relief to prevent breaches of
this Agreement by the other party and otherwise to enforce specifically the
provisions of this Agreement against the other party. Each party (a) expressly
waives any requirement that the other party obtain any bond or provide any
indemnity in connection with any action seeking injunctive relief or specific
enforcement of the provisions of this Agreement (b) agrees it will not oppose
the granting of such remedy.

 

Section 12.13         Jurisdiction and Service of Process. Any action or
proceeding arising out of or relating to this Agreement or the transactions
contemplated by this Agreement must be brought in the New York State Court
located in the City of New York, Borough of Manhattan, or, if it has or can
acquire jurisdiction, in the United States District Court for the Southern
District of New York located in the City

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 45

 

 

of New York, New York. Each of the parties knowingly, voluntarily and
irrevocably submits to the exclusive jurisdiction of each such court in any such
action or proceeding and waives any objection it may now or hereafter have to
venue or to convenience of forum. Any party to this Agreement may make service
on another party by sending or delivering a copy of the process to the party to
be served at the address and in the manner provided for the giving of notices in
Section 12.1. Nothing in this Section 12.13, however, affects the right of any
party to serve legal process in any other manner permitted by law.

 

Section 12.14         Waiver of Jury Trial. EACH OF THE PARTIES KNOWINGLY,
VOLUNTARILY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ALL
RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED
ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR THE ACTIONS OF ANY PARTY TO
THIS AGREEMENT IN NEGOTIATION, EXECUTION AND DELIVERY, PERFORMANCE OR
ENFORCEMENT OF THIS AGREEMENT.

 

Section 12.15         No Joint Venture. Nothing in this Agreement creates a
joint venture or partnership between the parties. This Agreement does not
authorize any party (a) to bind or commit, or to act as an agent, employee or
legal representative of, another party, except as may be specifically set forth
in other provisions of this Agreement, or (b) to have the power to control the
activities and operations of another party. The parties are independent
contractors with respect to each other under this Agreement. Each party agrees
not to hold itself out as having any authority or relationship contrary to this
Section 12.15.

 

Section 12.16         Non Recourse. No past, present or future Representative,
incorporator, member, partner, equity holder or Affiliate of the Seller, any
Acquired Company or any of their respective Affiliates shall have any liability
for any Liabilities of the Seller, as applicable, under this Agreement or for
any claim based on, in respect of, or by reason of, the transactions
contemplated hereby.

 

Section 12.17         Guaranty.

 

(a)          ARIAD US irrevocably guarantees all representation, warranty,
covenant and obligations of the Seller and the performance of its obligations
under the provisions of this Agreement. This is a guarantee of payment and
performance, and not of collection, and ARIAD US acknowledges and agrees that
this guarantee is full and unconditional, and no release or extinguishments of
the Seller’s Liabilities (other than in accordance with the terms of this
Agreement), whether by decree in any bankruptcy proceeding or otherwise, will
affect the continuing validity and enforceability of this guarantee. ARIAD US
hereby waives, for the benefit of the Purchaser any right to require the
Purchaser as a condition of payment or performance of ARIAD US to proceed
against the Seller.

 

(b)          Incyte US irrevocably guarantees all representation, warranty,
covenant and obligations of the Purchaser and the performance of its obligations
under the provisions of this Agreement. This is a guarantee of payment and
performance, and not of collection, and Incyte US acknowledges and agrees that
this guarantee is full and unconditional, and no release or extinguishments of
the Purchaser’s Liabilities (other than in accordance with the terms of this
Agreement), whether by decree in any bankruptcy proceeding or otherwise, will
affect the continuing validity and enforceability of this guarantee. Incyte US
hereby waives, for the benefit of the Seller any right to require the Seller as
a condition of payment or performance of Incyte US to proceed against the
Purchaser.

 

Section 12.18         Counterparts. The parties may execute this Agreement in
multiple counterparts, each of which constitutes an original as against the
party that signed it, and all of which together

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 46

 

 

constitute one agreement. This Agreement is effective upon delivery of one
executed counterpart from each party to the other parties. The signatures of all
parties need not appear on the same counterpart. The delivery of signed
counterparts by facsimile or email transmission that includes a copy of the
sending party’s signature(s) is as effective as signing and delivering the
counterpart in person.

 

[Signature page follows.]

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 47

 

 

IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of
the date indicated in the first sentence of this Agreement.

 

  ARIAD PHARMACEUTICALS (CAYMAN) L.P.       BY: ARIAD Pharmaceuticals (Cayman)
Inc., its General Partner             By: /s/ Manmeet S. Soni       Manmeet S.
Soni       Director       ARIAD PHARMACEUTICALS, INC., solely as guarantor      
  By: /s/ Manmeet S. Soni     Manmeet S. Soni     Executive Vice President,
Chief Financial Officer and Treasurer

 

[Signature Page to Stock Purchase Agreement]

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  

 

 

IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of
the date indicated in the first sentence of this Agreement.

 

  Incyte Europe S.à r.l.         By: /s/ Laurent Chardonnet     Name: Laurent
Chardonnet     Title: Head of Finance       Incyte CORPORATION, for the purposes
of Section 11.4 and 12.7(b)         By: /s/ Hervé Hoppenot     Name: Hervé
Hoppenot     Title: President and Chief Executive Officer

 

[Signature Page to Stock Purchase Agreement]

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  

 

 

For acknowledgment and consent of the transfers of the Shares in accordance with
the provisions of this Agreement and for the purpose of article 1690 of the
Luxembourg Civil code and 190 of the Luxembourg law dated 10 August 1915 on
commercial companies, as amended:

 

  ARIAD Pharmaceuticals (luxembourg) S.à r.l.         By: /s/ Jonathan Dickinson
    Jonathan Dickinson     Class A Manager

 

[Signature Page to Stock Purchase Agreement]

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  

 

 

EXHIBIT A

 

Amended and Restated Buy-In License Agreement

 

Attached.

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  

 

 

EXHIBIT B

 

Territory

 

European Union Countries   [***]     1.    Austria   [***] 2.    Belgium   37.
Israel 3.    Bulgaria   [***] 4.    Croatia   43. Norway 5.    Cyprus  
44. Russia 6.    Czech Republic   [***] 7.    Denmark   47. Switzerland
8.    Estonia   48. Turkey 9.    Finland   [***] 10.  France     11.  Germany  
  12.  Greece     13.  Hungary     14.  Ireland     15.  Italy     16.  Latvia  
  17.  Lithuania     18.  Luxembourg     19.  Malta     20.  Netherlands    
21.  Poland     22.  Portugal     23.  Romania     24.  Slovakia    
25.  Slovenia     26.  Spain     27.  Sweden     28.  United Kingdom    

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  

 

 

EXHIBIT C

 

Joint Press Release

 

Portions of this Exhibit, indicated by the mark “[***],” were omitted and have
been filed separately with the
Securities and Exchange Commission pursuant to the Registrant’s application
requesting confidential treatment
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.