Exhibit 10.6

 

 

 

 

 

 

 

INVESTOR AGREEMENT

By and Between

BAYER AG

AND

ARVINAS, INC.

Dated as of July 16, 2019

 

 

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TABLE OF CONTENTS

 

 

 

 

 

 

 

Page

 

 

 

 

 

 

 

1.

 

Definitions

 

1

 

 

 

 

 

2.

 

Registration Rights

 

6

 

 

 

 

 

 

 

2.1

 

Company Registration

 

6

 

 

2.2

 

Expenses

 

7

 

 

2.3

 

Effectiveness

 

7

 

 

2.4

 

Rule 415; Cutback

 

8

 

 

2.5

 

Company Obligations

 

8

 

 

2.6

 

Obligations of the Investor

 

11

 

 

2.7

 

Indemnification

 

11

 

 

 

 

 

 

 

3.

 

Standstill.

 

14

 

 

 

 

 

 

 

4.

 

Restrictions on Dispositions.

 

15

 

 

 

 

 

 

 

 

 

4.1

 

Lock-Up

 

15

 

 

4.2

 

Certain Tender Offers.

 

15

 

 

4.3

 

Sale Limitations

 

15

 

 

4.4

 

Offering Lock-Up

 

15

 

 

4.5

 

Transactions for Personal Account

 

15

 

 

 

 

 

 

 

5.

 

Voting Agreement.

 

16

 

 

 

 

 

 

 

 

 

5.1

 

Voting of Securities

 

16

 

 

5.2

 

Certain Extraordinary Matters

 

17

 

 

5.3

 

Quorum

 

17

 

 

 

 

 

 

 

6.

 

Termination of Certain Rights and Obligations

 

17

 

 

 

 

 

 

 

 

 

6.1

 

Termination of Registration Rights

 

17

 

 

6.2

 

Termination of Standstill Term

 

18

 

 

6.3

 

Termination of Lock-Up Term

 

18

 

 

6.4

 

Termination of Voting Agreement Term

 

18

 

 

6.5

 

Effect of Termination

 

18

 

 

 

 

 

 

 

7.

 

Miscellaneous.

 

19

 

 

 

 

 

 

 

 

 

7.1

 

Governing Law; Submission to Jurisdiction; Waiver of Jury Trial

 

19

 

 

7.2

 

Extension; Waiver

 

19

 

 

7.3

 

No Agreement Until Executed

 

20

 

 

7.4

 

Notices

 

20

 

 

7.5

 

Miscellaneous

 

21

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7.6

 

Amendments

 

21

 

 

7.7

 

Interpretation

 

21

 

 

7.8

 

Severability

 

21

 

 

7.9

 

Assignment

 

22

 

 

7.10

 

Third Party Beneficiaries

 

22

 

 

7.11

 

No Strict Construction

 

22

 

 

7.12

 

Equitable Remedies

 

22

 

 

7.13

 

Remedies Cumulative

 

22

 

 

7.14

 

No Conflicting Agreements

 

22

 

 

7.15

 

Use of Proceeds

 

22

 

 

7.16

 

No Publicity.

 

23

 

 

7.17

 

Limitation of Liability

 

23

 

 

7.18

 

Commitment Agreement and Collaboration Agreement

 

23

 

 

 

 

 

 

 

Exhibit A – Form of Irrevocable Proxy

Exhibit B – Plan of Distribution

 

 

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INVESTOR AGREEMENT

THIS INVESTOR AGREEMENT (this “Agreement”) is made as of July 16, 2019, by and
between Bayer AG (the “Investor”) and Arvinas, Inc. (the “Company”), a Delaware
corporation, with its principal place of business at 5 Science Park, 395
Winchester Ave., New Haven, CT 06511.

WHEREAS, the Stock Purchase Agreement, dated as of June 3, 2019, by and between
the Investor and the Company (the “Purchase Agreement”) provides for the
issuance and sale by the Company to the Investor, and the purchase by the
Investor, of a number of shares (such shares, the “Purchased Shares”) of the
Company’s common stock, par value $0.001 per share (the “Common Stock”);

WHEREAS, as a condition to consummating the transactions contemplated by the
Purchase Agreement, the Investor and the Company have agreed upon certain rights
and restrictions as set forth herein with respect to the Purchased Shares and
other securities of the Company beneficially owned by the Investor and its
Affiliates, and it is a condition to the closing under the Purchase Agreement
that this Agreement be executed and delivered by the Investor and the Company;
and

WHEREAS, simultaneously with the execution of the Purchase Agreement, the
Company and the Investor entered into the Commitment Agreement and the
Collaboration Agreement (as defined below).

NOW, THEREFORE, in consideration of the premises and mutual agreements
hereinafter set forth, and for other valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

1.Definitions.  As used in this Agreement, the following terms shall have the
following meanings:

(a)“Affiliate” shall mean, with respect to any Person, another Person that
controls, is controlled by or is under common control with such Person.  A
Person shall be deemed to control another Person if such Person possesses,
directly or indirectly, the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting
securities, by contract or otherwise.  Without limiting the generality of the
foregoing, for purposes of this Agreement, a Person shall be deemed to control
another Person if either of the following conditions is met: (i) in the case of
corporate entities, direct or indirect ownership of more than fifty percent
(50%) of the stock or shares having the right to vote for the election of
directors, or (ii) in the case of non-corporate entities, direct or indirect
ownership of more than fifty percent (50%) of the equity interest with the power
to direct the management and policies of such non-corporate entities.  For the
purposes of this Agreement, in no event shall the Investor or any of its
Affiliates be deemed Affiliates of the Company or any of its Affiliates, nor
shall the Company or any of its Affiliates be deemed Affiliates of the Investor
or any of its Affiliates.

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(b)“Agreement” shall have the meaning set forth in the Preamble to this
Agreement, including all Exhibits attached hereto.

(c)“Beneficial owner,” “beneficially owns,” “beneficial ownership” and terms of
similar import used in this Agreement shall, with respect to a Person, have the
meaning set forth in Rule 13d-3 under the Exchange Act (i) assuming the full
conversion into, and exercise and exchange for, shares of Common Stock of all
Common Stock Equivalents beneficially owned by such Person and (ii) determined
without regard for the number of days in which such Person has the right to
acquire such beneficial ownership.

(d)“Business Day” shall mean a day on which banking institutions in New, York,
New York, United States and Leverkusen, Germany are open for business, excluding
any Saturday or Sunday.

(e)“Change of Control” shall mean (i) the acquisition of beneficial ownership,
directly or indirectly, by any Third Party of securities or other voting
interests of the Company representing a majority or more of the combined voting
power of the Company’s then outstanding securities or other voting interests;
(ii) any merger, consolidation or business combination involving the Company
with a Third Party that results in the holders of beneficial ownership (other
than by virtue of obtaining irrevocable proxies) of voting securities or other
voting interests of the Company immediately prior to such merger, consolidation
or other business combination ceasing to hold beneficial ownership of more than
fifty percent (50%) of the combined voting power of the surviving entity
immediately after such merger, consolidation or business combination; (iii) any
sale, lease, exchange, contribution or other transfer to a Third Party (in one
transaction or a series of related transactions) of all or substantially all of
the Company’s assets; or (iv) individuals who, as of the date hereof, constitute
the Board of Directors of the Company (the “Incumbent Board”) cease for any
reason to constitute at least a majority of the Board of Directors of the
Company (provided, however, that any individual becoming a director subsequent
to the date hereof whose election, or nomination for election by the Company’s
shareholders, was recommended or approved by a vote of at least a majority of
the directors then comprising the Incumbent Board shall be considered as though
such individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of any person other than the Board of Directors of the
Company).

(f)“Closing Date” shall have the meaning set forth in the Purchase Agreement.

(g)“Collaboration Agreement” shall have the meaning set forth in the Purchase
Agreement.

(h)“Commitment Agreement” shall have the meaning set forth in the Purchase
Agreement.

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(i)“Common Stock” shall have the meaning set forth in the Preamble to this
Agreement.

(j)“Common Stock Equivalents” shall mean any options, restricted stock units,
warrants or other securities or rights convertible into or exercisable,
exchangeable or settleable for, whether directly or following conversion into or
exercise, exchange or settlement for other options, restricted stock units,
warrants or other securities or rights, shares of Common Stock or any swap,
hedge or similar agreement or arrangement that transfers in whole or in part,
the economic risk of ownership of, or voting or other rights of, the Common
Stock.

(k)“Company” shall have the meaning set forth in the Preamble to this Agreement.

(l)“Competitor” shall mean any biopharmaceutical enterprise significantly
involved in developing and commercializing protein degrading technologies, or
any other Person that directly or indirectly beneficially owns a majority of the
voting securities or voting interests in such an enterprise, or any direct or
indirect majority-owned subsidiary of such an enterprise or of such a Person.

(m)“Disposition” or “Dispose of” shall mean any (i) pledge, sale, contract to
sell, sale of any option or contract to purchase, purchase of any option or
contract to sell, grant of any option, right or warrant for the sale of, or
other disposition of or transfer of any shares of Common Stock, or any Common
Stock Equivalents, including, without limitation, any “short sale” or similar
arrangement, or (ii) swap or any other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the economic consequence
of ownership of shares of Common Stock, whether any such swap or transaction is
to be settled by delivery of securities, in cash or otherwise.

(n)“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.

(o)“Extraordinary Matter” shall have the meaning set forth in Section 5.2.

(p)“Investor” shall have the meaning set forth in the Preamble to this
Agreement.

(q)“Irrevocable Proxy” shall have the meaning set forth in Section 5.1.

(r)“Joint Venture” shall have the meaning set forth in the Purchase Agreement.

(s)“Law” or “Laws” shall mean any law, statute, rule, regulation, order,
judgment or ordinance having the effect of law of any national, federal, state,
provincial, regional, county, city or other political subdivision of any such
government or country or any supranational organization of which any such
country is a member.

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(t)“Lock-Up Agreement” shall have the meaning set forth in Section 4.4.

(u) “Lock-Up Term” shall mean the period from and after the date of this
Agreement until the occurrence of any event set forth in Section 6.3.

(v)“Permitted Transferee” shall mean (i) a controlled Affiliate of the Investor
or (ii) a controlling Affiliate of the Investor (or any controlled Affiliate of
such controlling Affiliate) or the acquiring Person in the case of a change of
control of the Investor.

(w)“Permitted Transferee Irrevocable Proxy” shall have the meaning set forth in
Section 5.1.

(x)“Person” shall mean any individual, partnership, joint venture, limited
liability company, firm, corporation, trust, unincorporated organization,
government or any department or agency thereof or other entity, as well as any
syndicate or group that would be deemed to be a Person under Section 13(d)(3) of
the Exchange Act.

(y)“Prospectus” shall mean (i) the prospectus included in any Registration
Statement, as amended or supplemented by any prospectus supplement, with respect
to the terms of the offering of any portion of the Registrable Securities
covered by such Registration Statement and by all other amendments and
supplements to the prospectus, including post-effective amendments and all
material incorporated by reference in such prospectus, and (ii) any “free
writing prospectus” as defined in Rule 405 under the Securities Act.

(z)“Purchase Agreement” shall have the meaning set forth in the Preamble to this
Agreement and shall include all Exhibits attached thereto.

(aa)“Purchased Shares” shall have the meaning set forth in the Preamble to this
Agreement, and shall be adjusted for (i) any stock split, stock dividend, share
exchange, merger, consolidation or similar recapitalization and (ii) any Common
Stock issued as (or issuable upon the exercise of any warrant, right or other
security that is issued as) a dividend or other distribution with respect to, or
in exchange or in replacement of, the Purchased Shares.

(bb)“Register,” “registered” and “registration” refer to a registration made by
preparing and filing a Registration Statement or similar document in compliance
with the Securities Act, and the declaration or ordering of effectiveness of
such Registration Statement or document.

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(cc)“Registrable Securities” shall mean (i) the Purchased Shares and (ii) any
other securities issued or issuable with respect to or in exchange for the
Purchased Shares, whether by merger, charter amendment or otherwise; provided
that a security shall cease to be a Registrable Security upon the earlier of
(A) a sale pursuant to a Registration Statement or a valid exemption under the
Securities Act, and (B) such security becoming eligible for sale without
restriction by the Investor pursuant to Rule 144 and without the requirement to
be in compliance with Rule 144(c)(1) (or any successor thereto) promulgated
under the Securities Act.

(dd)“Registration Statement” shall mean a registration statement of the Company
under the Securities Act that covers the resale of any of the Registrable
Securities pursuant to the provisions of this Agreement, amendments and
supplements to such Registration Statement, including post-effective amendments,
all exhibits and all material incorporated by reference in such Registration
Statement.

(ee)“SEC” shall mean the U.S. Securities and Exchange Commission.

(ff)“Securities Act” shall mean the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.

(gg)“Selling Securityholder Questionnaire” shall mean a form of selling
securityholder questionnaire as may be reasonably requested by the Company from
time to time.

(hh) “Shares of Then Outstanding Common Stock” shall mean, at any time, the
issued and outstanding shares of Common Stock at such time, as well as all
capital stock issued and outstanding at such time as a result of any stock
split, stock dividend, or reclassification of Common Stock distributable, on a
pro rata basis, to all holders of Common Stock.

(ii)“Standstill Parties” shall have the meaning set forth in Section 3.1.

(jj)“Standstill Term” shall mean the period from and after the date of this
Agreement until the occurrence of any event set forth in Section 6.2.

(kk)“Third Party” shall mean any Person other than the Investor, the Company or
any Affiliate of the Investor or the Company.

(ll)“Voting Agreement Term” shall mean the period from and after the date of
this Agreement until the occurrence of any event set forth in Section 6.4.

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2.Registration Rights.

2.1Company Registration.  

(a)If, prior to the third (3rd) anniversary of the date hereof, the Company
proposes to file a registration statement to register shares of the Company’s
Common Stock (a “Triggering Registration”), it will, prior to such filing,
promptly give written notice to the Investor of its intention to do so and, if
the Company receives the written request of the Investor (an “Investor Request”)
within twenty (20) Business Days after the Company provides such notice, the
Company shall use commercially reasonable efforts to (i) promptly prepare and
file with the SEC one Registration Statement covering the resale of all of the
Registrable Securities within thirty (30) days after the date of such Investor
Request (the “Filing Deadline”) and (ii) make such Registration Statement become
effective with the SEC within ninety (90) days after the Filing Deadline (or as
soon as practicable thereafter). Subject to any SEC comments, such Registration
Statement shall include the plan of distribution attached hereto as Exhibit B;
provided, however, that in no event shall the Investor be named as an
“underwriter” in such Registration Statement without the Investor’s prior
written consent.  Such Registration Statement also shall cover, to the extent
allowable under the Securities Act and the rules promulgated thereunder
(including Rule 416), such indeterminate number of additional shares of Common
Stock resulting from stock splits, stock dividends or similar transactions with
respect to the Registrable Securities.  Such Registration Statement (and each
amendment or supplement thereto, and each request for acceleration of
effectiveness thereof) shall be provided in accordance with Section 2.5(c)
hereof to the Investor prior to its filing or other submission.

(b)Notwithstanding any other provision of this Section 2, following notice of a
Triggering Registration but prior to the filing of the underlying registration
statement with the SEC, the Company shall have the right to postpone or withdraw
any such Triggering Registration without obligation to the Investor pursuant to
Section 2.1(a) (regardless of whether an Investor Request has been delivered).

(c)If the Investor does not submit an Investor Request within twenty (20)
Business Days of the Company’s notice that it proposes to file its first
registration statement to register shares of the Company’s Common Stock after
the date hereof, or notifies the Company in writing that it does not intend to
request registration of its shares, the Investor shall be deemed to have
forfeited its registration rights under this Agreement and this Section 2 shall
be of no further force and effect. For the avoidance of doubt, to the extent the
Investor does timely submit an Investor Request and for any reason (other than a
withdrawal of such Investor Request by the Investor, and subject to Sections
2.3(b) and 2.4 below) a Registration Statement covering the Investor’s
Registrable Securities is not subsequently declared effective by the SEC
(including in the event that the Triggering Registration is withdrawn by the
Company pursuant to Section 2.1(b) above), Section 2.1(a) shall apply with
respect to the Company’s next filing of a registration statement to register
shares of the Company’s Common Stock.

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2.2Expenses.  The Company will pay all expenses associated with the Registration
Statement, including filing and printing fees, the Company’s counsel and
accounting fees and expenses, costs associated with clearing the Registrable
Securities for sale under applicable state securities laws and listing fees, but
excluding discounts, commissions, fees of underwriters, selling brokers, dealer
managers or similar securities industry professionals with respect to the
Registrable Securities being sold.  The Company will reimburse the Investor for
all reasonable, documented out-of-pocket legal expenses incurred by the Investor
associated with the Registration Statement up to an aggregate of US $25,000.

2.3Effectiveness.  

(a)The Company shall use commercially reasonable efforts to have the
Registration Statement declared effective as soon as practicable after
filing.  The Company shall notify the Investor by facsimile or e-mail as
promptly as practicable, and in any event, within twenty-four (24) hours, after
the Registration Statement is declared effective and shall simultaneously
provide the Investor with copies of any related Prospectus to be used in
connection with the sale or other disposition of the securities covered thereby.

(b)For not more than sixty (60) consecutive days or for a total of not more than
one hundred twenty (120) days in any twelve (12) month period, the Company may
suspend the use of any Prospectus included in the Registration Statement
contemplated by this Section 2 in the event that the Company determines in good
faith that such suspension is necessary to (A) delay the disclosure of material
non-public information concerning the Company, the disclosure of which at the
time is not, in the good faith opinion of the Company, after consultation with
counsel, in the best interests of the Company, (B) amend or supplement the
affected Registration Statement or the related Prospectus so that such
Registration Statement or Prospectus shall not include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the case of the Prospectus in light
of the circumstances under which they were made, not misleading, (C) permit the
Company to conduct a sale of securities or other financing that is not a sale of
Registrable Securities or (D) file a replacement Registration Statement covering
the resale of Registrable Securities in connection with the expiration or
anticipated expiration of an effective Registration Statement (an “Allowed
Delay”), provided that the Company shall promptly (i) notify the Investor in
writing of the commencement of an Allowed Delay, but shall not (without the
prior written consent of the Investor) disclose to the Investor any material
non-public information giving rise to an Allowed Delay, (ii) advise the Investor
in writing to cease all sales under such Registration Statement until the end of
the Allowed Delay and (iii) use commercially reasonable efforts to terminate an
Allowed Delay as promptly as practicable.

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2.4Rule 415; Cutback.  If at any time the SEC takes the position that the
offering of some or all of the Registrable Securities in a Registration
Statement is not eligible to be made on a delayed or continuous basis under the
provisions of Rule 415 under the Securities Act or requires the Investor to be
named as an “underwriter,” the Company shall use commercially reasonable efforts
to persuade the SEC that the offering contemplated by such Registration
Statement is a valid secondary offering and not an offering “by or on behalf of
the issuer” as defined in Rule 415 and that the Investor is not an
“underwriter.”  The Investor shall have the right to select one legal counsel to
review and oversee any registration or matters pursuant to this Section 2.4,
including participation in any meetings or discussions with the SEC regarding
the SEC’s position and to comment on any written submission made to the SEC with
respect thereto.    In the event that, despite the Company’s commercially
reasonable efforts and compliance with the terms of this Section 2.4, the SEC
does not alter its position, the Company shall (i) remove from such Registration
Statement such portion of the Registrable Securities (the “Cut Back Shares”)
and/or (ii) agree to such restrictions and limitations on the registration and
resale of the Registrable Securities as the SEC may require to assure the
Company’s compliance with the requirements of Rule 415 (collectively, the “SEC
Restrictions”); provided, however, that the Company shall not agree to name the
Investor as an “underwriter” in such Registration Statement without the prior
written consent of the Investor.  Any cut-back imposed on the Investor pursuant
to this Section 2.4 shall be applied first to any of the Registrable Securities
of the Investor as such Investor shall designate, unless the SEC Restrictions
otherwise require or provide or the Investor otherwise agrees. From and after
such date as the Company is able to effect the registration of such Cut Back
Shares, the Company shall use commercially reasonable efforts to file a
Registration Statement relating to such Cut Back Shares and to have such
Registration Statement declared effective by the SEC.

2.5Company Obligations.  The Company will use commercially reasonable efforts to
effect the registration of the Registrable Securities in accordance with the
terms hereof, and pursuant thereto the Company will, as expeditiously as
possible:

(a)use commercially reasonable efforts to cause such Registration Statement to
remain continuously effective for a period that will terminate upon the earlier
of (i) the date on which all Registrable Securities covered by such Registration
Statement, as amended from time to time, have been sold, (ii) the date on which
the Investor and its Affiliates together own less than one percent (1%) of the
Shares of Then Outstanding Common Stock, and (iii) the first (1st) anniversary
of the later of (A) the date on which such Registration Statement was declared
effective by the SEC and (B) the end of the Lock-Up Term (the “Effectiveness
Period”), and advise the Investor promptly in writing when the Effectiveness
Period has expired;

(b)use commercially reasonable efforts to prepare and file with the SEC such
amendments and post-effective amendments to such Registration Statement and the
related Prospectus as may be necessary to keep such Registration Statement
effective for the Effectiveness Period and to comply with the provisions of the
Securities Act and the Exchange Act with respect to the distribution of all of
the Registrable Securities covered thereby;

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(c)provide copies to and permit any counsel designated by the Investor to review
the Registration Statement and all amendments and supplements thereto (but
excluding any documents incorporated by reference in such Registration
Statement, amendments or supplements that are available on the SEC’s Electronic
Data Gathering, Analysis, and Retrieval system (or any successor system)) no
fewer than five (5) Business Days prior to their filing with the SEC and not
file any document to which such counsel reasonably objects;

(d)furnish to the Investor (i) promptly after the same is prepared and filed
with the SEC, if requested by the Investor, one (1) copy of any Registration
Statement and any amendment thereto, each preliminary prospectus and Prospectus
and each amendment or supplement thereto, and each letter written by or on
behalf of the Company to the SEC or the staff of the SEC, and each item of
correspondence from the SEC or the staff of the SEC, in each case relating to
such Registration Statement (other than any portion of any of the foregoing
which contains information for which the Company has sought confidential
treatment), and (ii) such number of copies of a Prospectus, including a
preliminary prospectus, and all amendments and supplements thereto and such
other documents as the Investor may reasonably request in order to facilitate
the disposition of the Registrable Securities owned by the Investor that are
covered by such Registration Statement;

(e)use commercially reasonable efforts to (i) prevent the issuance of any stop
order or other suspension of effectiveness and, (ii) if such order is issued,
obtain the withdrawal of any such order at the earliest practical moment;

(f)prior to any public offering of Registrable Securities, use commercially
reasonable efforts to register or qualify or cooperate with the Investor and its
counsel in connection with the registration or qualification of such Registrable
Securities for the offer and sale under the securities or blue sky laws of such
jurisdictions requested by the Investor and do any and all other commercially
reasonable acts or things necessary or advisable to enable the distribution in
such jurisdictions of the Registrable Securities covered by the Registration
Statement; provided, however, that the Company shall not be required in
connection therewith or as a condition thereto to (i) qualify to do business in
any jurisdiction where it would not otherwise be required to qualify but for
this Section 2.5(f), (ii) subject itself to general taxation in any jurisdiction
where it would not otherwise be so subject but for this Section 2.5(f), or
(iii) file a general consent to service of process in any such jurisdiction;

(g)use commercially reasonable efforts to cause all Registrable Securities
covered by a Registration Statement to be listed on each securities exchange,
interdealer quotation system or other market on which similar securities issued
by the Company are then listed;

(h)promptly notify the Investor, at any time prior to the end of the
Effectiveness Period, upon discovery that, or upon the happening of any event as
a result of which, the Prospectus includes an untrue statement of a material
fact or omits to state any material fact required to be stated therein or
necessary to make the statements

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therein not misleading in light of the circumstances then existing, and promptly
prepare, file with the SEC and furnish to such holder a supplement to or an
amendment of such Prospectus as may be necessary so that such Prospectus shall
not include an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing;

(i)notify the Investor, promptly after the Company receives notice thereof, of
the time when such Registration Statement has been declared effective or a
supplement to any Prospectus forming a part of such Registration Statement has
been filed;

(j)after such Registration Statement becomes effective, notify the Investor of
any request by the SEC that the Company amend or supplement such Registration
Statement or Prospectus;

(k)otherwise use commercially reasonable efforts to comply with all applicable
rules and regulations of the SEC under the Securities Act and the Exchange Act,
including, without limitation, Rule 172 under the Securities Act, file any final
Prospectus, including any supplement or amendment thereof, with the SEC pursuant
to Rule 424 under the Securities Act, promptly inform the Investor in writing
if, at any time during the Effectiveness Period, the Company does not satisfy
the conditions specified in Rule 172 and, as a result thereof, the Investor is
required to deliver a Prospectus in connection with any disposition of
Registrable Securities and take such other actions as may be reasonably
necessary to facilitate the registration of the Registrable Securities
hereunder; and make available to its security holders, as soon as reasonably
practicable,  an earnings statement covering a period of at least twelve
(12) months, beginning after the effective date of the Registration Statement,
which earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act, including Rule 158 promulgated thereunder; and

(l)with a view to making available to the Investor the benefits of Rule 144 (or
its successor rule) and any other rule or regulation of the SEC that may at any
time permit the Investor to sell shares of Common Stock to the public without
registration, the Company covenants and agrees to: (i) make and keep public
information available, as those terms are understood and defined in Rule 144,
until the earlier of (A) six months after such date as all of the Registrable
Securities may be sold without restriction by the holders thereof pursuant to
Rule 144 and without the requirement to be in compliance with Rule 144(c)(1) (or
any successor thereto) promulgated under the Securities Act or any other rule of
similar effect or (B) such date as all of the Registrable Securities shall have
been resold; (ii) file with the SEC in a timely manner all reports and other
documents required of the Company under the Exchange Act; and (iii) furnish to
the Investor upon request, as long as the Investor owns any Registrable
Securities, (A) a written statement by the Company that it has complied with the
reporting requirements of the Exchange Act, (B) a copy of the Company’s most
recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q, and (C) such
other information as may be reasonably requested in order to avail the Investor
of any rule or regulation of the SEC that permits the selling of any such
Registrable Securities without registration.

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2.6Obligations of the Investor.  

(a)It shall be a condition precedent to the obligations of the Company to take
any action pursuant to Section 2 hereof with respect to the Registrable
Securities that the Investor furnish in writing to the Company a Selling
Securityholder Questionnaire and any other information regarding itself, the
Registrable Securities and the intended method of disposition of the Registrable
Securities, as shall be reasonably required to effect the registration of such
Registrable Securities, and such Investor shall execute such documents in
connection with such registration as the Company may reasonably request.  At
least ten (10) Business Days prior to the first anticipated filing date of any
Registration Statement, the Company shall notify the Investor of the information
the Company requires from the Investor in connection with such Registration
Statement.  The Investor shall provide such information to the Company at least
five (5) Business Days prior to the first anticipated filing date of such
Registration Statement.

(b)The Investor, by its acceptance of the Registrable Securities, agrees to
cooperate with the Company as reasonably requested by the Company in connection
with the preparation and filing of a Registration Statement hereunder, unless
the Investor has notified the Company in writing of its election to not request
registration of the Registrable Securities pursuant to Section 2.1 of this
Agreement

(c)The Investor agrees that, upon receipt of any written notice from the Company
of either (i) the commencement of an Allowed Delay pursuant to Section 2.3(b) or
(ii) the happening of an event pursuant to Section 2.5(h) hereof, the Investor
will immediately discontinue disposition of Registrable Securities pursuant to
any Registration Statement covering such Registrable Securities, until the
Investor is advised by the Company in writing that such dispositions may again
be made.

(d)The Investor covenants and agrees that it will comply with the prospectus
delivery requirements of the Securities Act as applicable to it or an exemption
therefrom in connection with sales of Registrable Securities pursuant to any
Registration Statement.

2.7Indemnification.

(a)Indemnification by the Company.  The Company shall indemnify and hold
harmless the Investor and its officers, directors, members, employees and
agents, successors and assigns, and each other person, if any, who controls the
Investor within the meaning of the Securities Act, against any losses, claims,
damages or liabilities, joint or several, to which they may become subject under
the Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based
upon:  (i) any untrue statement or alleged untrue statement or omission or
alleged omission of any material fact contained in any Registration Statement,
any preliminary Prospectus or final Prospectus, or any amendment or supplement
thereof; (ii) any violation by the Company or its agents of any rule or
regulation promulgated under the Securities Act applicable to the Company or its

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agents and relating to action or inaction required of the Company in connection
with such registration; or (iii) any failure to register or qualify the
Registrable Securities included in any such Registration Statement in any state
where the Company or its agents has affirmatively undertaken or agreed in
writing that the Company will undertake such registration or qualification on
the Investor’s behalf and will reimburse the Investor, and each such officer,
director or member and each such controlling person for any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the Company will not be liable in any such case if and to the extent that
any such loss, claim, damage or liability arises out of or is based upon (i) an
untrue statement or alleged untrue statement or omission or alleged omission so
made in conformity with information furnished by the Investor or any such
controlling person in writing specifically for use in such Registration
Statement or Prospectus, (ii) the use by the Investor of an outdated or
defective Prospectus after the Company has notified the Investor in writing that
such Prospectus is outdated or defective, (iii) the Investor’s failure to send
or give a copy of the Prospectus or supplement (as then amended or
supplemented), if required (and not exempted) to the Persons asserting an untrue
statement or omission or alleged untrue statement or omission at or prior to the
written confirmation of the sale of Registrable Securities or (iv) the
disposition of any Registrable Securities pursuant to any Registration Statement
or Prospectus covering such Registrable Securities during an Allowed Delay.

(b)Indemnification by the Investor.  The Investor shall indemnify and hold
harmless, to the fullest extent permitted by law, the Company, its directors,
officers, employees, stockholders and each person who controls the Company
(within the meaning of the Securities Act) against any losses, claims, damages,
liabilities and expense (including reasonable attorney fees) resulting from any
untrue statement of a material fact or any omission of a material fact required
to be stated in any Registration Statement or Prospectus or preliminary
Prospectus or amendment or supplement thereto or necessary to make the
statements therein not misleading, to the extent, but only to the extent that
such untrue statement or omission is contained in any information furnished in
writing by the Investor to the Company specifically for inclusion in such
Registration Statement or Prospectus or amendment or supplement thereto.  Except
to the extent that any such losses claims, damages, liabilities or expenses are
finally judicially determined to have resulted from the Investor’s fraud or
willful misconduct, in no event shall the liability of the Investor be greater
in amount than the dollar amount of the proceeds (net of all expense paid by the
Investor in connection with such registration and/or any claim relating to this
Section 2.7 and the amount of any damages the Investor has otherwise been
required to pay by reason of such untrue statement or omission) received by the
Investor upon the sale of the Registrable Securities included in such
Registration Statement giving rise to such indemnification obligation.

(c)Conduct of Indemnification Proceedings.  Any person entitled to
indemnification hereunder shall (i) give prompt notice to the indemnifying party
of any claim with respect to which it seeks indemnification and (ii) permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party; provided, however, that any person
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indemnification hereunder shall have the right to employ separate counsel and to
participate in the defense of such claim, but the fees and expenses of such
counsel shall be at the expense of such person unless (a) the indemnifying party
has agreed to pay such fees or expenses, (b) the indemnifying party shall have
failed to assume the defense of such claim and employ counsel reasonably
satisfactory to such person or (c) in the reasonable judgment of any such
person, based upon written advice of its counsel, a conflict of interest exists
between such person and the indemnifying party with respect to such claims (in
which case, if the person notifies the indemnifying party in writing that such
person elects to employ separate counsel at the expense of the indemnifying
party, the indemnifying party shall not have the right to assume the defense of
such claim on behalf of such person); and provided, further, that the failure of
any indemnified party to give notice as provided herein shall not relieve the
indemnifying party of its obligations hereunder, except to the extent that such
failure to give notice shall materially and adversely affect the indemnifying
party in the defense of any such claim or litigation.  It is understood that the
indemnifying party shall not, in connection with any proceeding in the same
jurisdiction, be liable for fees or expenses of more than one separate firm of
attorneys at any time for all such indemnified parties.  No indemnifying party
will, except with the consent of the indemnified party, which shall not be
unreasonably withheld or conditioned, consent to entry of any judgment or enter
into any settlement that does not include as a full and unconditional term
thereof the giving by the claimant or plaintiff to such indemnified party of a
release from all liability (monetary or otherwise) in respect of such claim or
litigation.

(d)Contribution.  If for any reason the indemnification provided for in the
preceding paragraphs (a) and (b) is unavailable to an indemnified party or
insufficient to hold it harmless, other than as expressly specified therein,
then the indemnifying party shall contribute to the amount paid or payable by
the indemnified party as a result of such loss, claim, damage or liability in
such proportion as is appropriate to reflect the relative fault of the
indemnified party and the indemnifying party, as well as any other relevant
equitable considerations.  No person guilty of fraudulent misrepresentation
within the meaning of Section 11(f) of the Securities Act shall be entitled to
contribution from any person not guilty of such fraudulent
misrepresentation.  Except to the extent that any such losses claims, damages,
liabilities or expenses are finally judicially determined to have resulted from
the Investor’s fraud or willful misconduct, in no event shall the contribution
obligation of the Investor be greater in amount than the dollar amount of the
proceeds (net of all expenses paid by the Investor in connection with such
registration and/or any claim relating to this Section 2.7 and the amount of any
damages such Investor has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission) received by
it upon the sale of the Registrable Securities giving rise to such contribution
obligation.

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3.Standstill.

3.1For the duration of the Standstill Term, unless the Company or its Affiliates
or representatives have specifically invited or approved the Investor to do so
in writing, neither the Investor nor any of its Affiliates or representatives
(collectively, the “Standstill Parties”) will in any manner, directly or
indirectly, (i) effect or seek, offer or propose (whether publicly or otherwise)
to effect, or cause or participate in or in any way advise, assist or encourage
any other Person to effect or seek, offer or propose (whether publicly or
otherwise) to effect or participate in: (A) any acquisition of any securities
(or beneficial ownership thereof) or assets of the Company, or any rights to
acquire any such securities (including derivative securities representing the
right to vote or economic benefit of any such securities) or assets; (B) any
tender or exchange offer, merger or other business combination involving the
Company; (C) any recapitalization, restructuring, liquidation, dissolution or
other extraordinary transaction with respect to the Company; or (D) any
“solicitation” of “proxies” (as such terms are used in the proxy rules of the
SEC) or consents to vote any voting securities of the Company; (ii) form, join
or in any way participate in a “group” (as defined under the Exchange Act) with
respect to any securities of the Company; (iii) otherwise act, alone or in
concert with others, to control or influence the management, Board of Directors
or policies of the Company; (iv) negotiate with or provide any information to
any Person (other than the Investor’s representatives in accordance with this
Agreement) with respect to, or make any statement or proposal to any Person
(other than the Investor’s representatives in accordance with this Agreement)
with respect to, or make any public announcement or proposal or offer whatsoever
with respect to, or act as a financing source for or otherwise invest in any
other Persons in connection with, or otherwise solicit, seek or offer to effect
any transactions or actions described, or take any action which would reasonably
be expected to require the Company to make a public announcement regarding any
of the types of matters set forth in clause (i) above; or (v) enter into any
discussions or arrangements with any Third Party with respect to any of the
foregoing.  Notwithstanding anything to the contrary contained in this
Agreement, Investor and its Affiliates shall not be precluded from owning or
acquiring interests in broad-based mutual funds or similar entities that own
capital stock of the Company, and nothing herein shall prohibit passive
investments by pension or employee benefit plans of Investor.

3.2The Investor also agrees during the Standstill Term not to request the
Company (or its directors, officers, employees or agents), directly or
indirectly, to amend or waive any provision of this Section 3 (including this
sentence).  

3.3The Investor’s obligations under this Section 3 shall not apply in the event
that, during the Standstill Term, the Company publicly announces that it has
entered into an agreement with any Third Party or group which provides for the
acquisition (by way of merger, tender offer or otherwise) by such Third Party or
group of more than fifty percent (50%) of the then-outstanding capital stock of
the Company, securities representing more than fifty percent (50%) of the voting
power of the then-outstanding capital stock of the Company, or all or
substantially all the consolidated assets of the Company until such time, if
applicable, that such agreement is terminated in accordance with its terms.  The
expiration or tolling of the Investor’s obligations under this Section 3 will
not terminate or otherwise affect any other provision in this Agreement.

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4.Restrictions on Dispositions.

4.1Lock-Up.  During the Lock-Up Term, without the prior approval of the Company,
the Investor shall not, and shall cause its Affiliates not to, Dispose of any of
the Purchased Shares; provided, however, that the foregoing shall not prohibit
the Investor from (i) transferring the Purchased Shares to a Permitted
Transferee or (ii) Disposing of any Purchased Shares in order to reduce the
beneficial ownership of the Standstill Parties to 19.99%, or such lesser
percentage as advised in good faith and in writing by the Investor’s certified
public accountants that would be necessary pursuant to applicable accounting
rules and guidelines so as to not require the Investor to include in its
financial statements its portion of the Company’s financial results, of the
Shares of Then Outstanding Common Stock.

4.2Certain Tender Offers.  Notwithstanding any other provision of this Section
4, this Section 4 shall not prohibit or restrict any Disposition of Shares of
Then Outstanding Common Stock and/or Common Stock Equivalents by the Standstill
Parties into (i) a tender offer by a Third Party which is not opposed by the
Company’s Board of Directors (but only after the Company’s filing of a Schedule
14D-9, or any amendment thereto, with the SEC disclosing the recommendation of
the Company’s Board of Directors with respect to such tender offer) or (ii) an
issuer tender offer by the Company.

4.3Sale Limitations. Subject to the restrictions set forth in Section 4.1, the
Investor agrees that, except for any transfer of Shares of Then Outstanding
Common Stock and/or Common Stock Equivalents by the Investor to a Permitted
Transferee or the Company, it shall not, and shall cause its Affiliates not to,
Dispose of any Shares of Then Outstanding Common Stock and/or Common Stock
Equivalents at any time to any Person that such Investor or Affiliate knows
(after a reasonable inquiry in a private placement) is a Competitor.

4.4Offering Lock-Up.  The Investor shall, if requested in writing by the Company
and an underwriter of Common Stock in connection with any underwritten public
offering of Common Stock, agree not to Dispose of any Shares of Then Outstanding
Common Stock and/or Common Stock Equivalents for a specified period of time,
such period of time not to exceed ninety (90) days (a “Lock-Up Agreement”),
provided that (a) such agreement shall not restrict the Investor’s ability to
Dispose of any Shares of Then Outstanding Common Stock and/or Common Stock
Equivalents in accordance with Section 4.2, and (b) each officer and director
has entered into a written agreement with similar obligations no less favorable
to such Person than as contemplated hereby.  Any Lock-Up Agreement shall be in
writing in a form reasonably satisfactory to the Company and the underwriter(s)
in such offering.  The Company may impose stop transfer instructions with
respect to the Shares of Then Outstanding Common Stock and/or Common Stock
Equivalents subject to the foregoing restrictions until the end of the specified
period of time.

4.5Transactions for Personal Account.  For the avoidance of doubt, nothing in
this Article 4 will restrict any Disposition of shares of Common Stock held by
an executive officer or director of the Investor for his or her personal
account.

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5.Voting Agreement.

5.1Voting of Securities.  During the Voting Agreement Term, other than as
permitted by Section 5.2 with respect to Extraordinary Matters, in any vote or
action by written consent of the stockholders of the Company (including, without
limitation, with respect to the election of directors), the Investor shall, and
shall cause any Permitted Transferees to, vote or execute a written consent with
respect to the Purchased Shares, in the sole discretion of the Investor, in
accordance with the written  recommendation of the Company’s Board of
Directors.  In furtherance of this Section 5.1, the Investor hereby irrevocably
appoints the Company and any individuals designated by the Company (such
designated individuals to be limited to the President and Chief Executive
Officer, Chief Financial Officer or Secretary of the Company), and each of them
individually, as the attorneys, agents and proxies, with full power of
substitution and re-substitution in each of them, for the Investor, and in the
name, place and stead of the Investor, to vote (or cause to be voted) in such
manner as set forth in this Section 5.1 (but in any case, excluding any matter
that is an Extraordinary Matter described in Section 5.2) with respect to the
Purchased Shares to which the Investor is or may be entitled to vote at any
meeting of the Company held after the date hereof, whether annual or special and
whether or not an adjourned meeting (the “Irrevocable Proxy”).  This Irrevocable
Proxy is coupled with an interest, shall be irrevocable and binding on any
successor-in-interest of the Investor and shall not be terminated by operation
of law upon the occurrence of any event.  This Irrevocable Proxy shall operate
to revoke and render void any prior proxy as to voting securities heretofore
granted by the Investor which is inconsistent herewith.  Notwithstanding the
foregoing, the Irrevocable Proxy shall be effective if, at any annual or special
meeting of the stockholders of the Company and at any adjournments or
postponements of any such meetings, the Investor (i) fails to appear or
otherwise fails to cause its voting securities of the Company to be counted as
present for purposes of calculating a quorum, or (ii) fails to vote such voting
securities in accordance with this Section 5.1, in each case at least two (2)
Business Days prior to the date of such stockholders’ meeting.  The Irrevocable
Proxy shall terminate upon the earlier of the expiration or termination of the
Voting Agreement Term.  The Investor shall cause any Permitted Transferee to
promptly execute and deliver to the Company an irrevocable proxy, substantially
in the form of Exhibit A attached hereto, and irrevocably appoint the Company
and any individuals designated by the Company, and each of them individually,
with full power of substitution and resubstitution, as its attorney, agent and
proxy to vote (or cause to be voted) such Purchased Shares of the Company as to
which such Permitted Transferee is entitled to vote, in such manner as each such
attorney, agent and proxy or his substitute shall in its, his or her sole
discretion deem appropriate or desirable with respect to the matters set forth
in this Section 5.1 (the “Permitted Transferee Irrevocable Proxy”).  The
Investor acknowledges, and shall cause any Permitted Transferees to acknowledge,
that any such proxy executed and delivered shall be coupled with an interest,
shall constitute, among other things, an inducement for the Company to enter
into this Agreement, shall be irrevocable and binding on any
successor-in-interest of such Permitted Transferee and shall not be terminated
by operation of Law upon the occurrence of any event.  Such proxy shall operate
to revoke and render void any prior proxy as to any voting securities of the
Company heretofore granted by such Permitted Transferee, to the extent it is
inconsistent herewith.  The Investor acknowledges and agrees that it shall be a
condition to any proposed transfer of voting securities of the Company by the
Investor to such Permitted Transferee that such

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Permitted Transferee execute and deliver to the Company a Permitted Transferee
Irrevocable Proxy, and that any purported transfer shall be void and of no force
or effect if such Permitted Transferee Irrevocable Proxy is not so executed and
delivered at the closing of such transfer.  Such proxy shall terminate upon the
earlier of the expiration or termination of the Voting Agreement Term.  The
Investor acknowledges and agrees that it shall be a condition to any proposed
transfer of voting securities of the Company by the Investor to any Permitted
Transferee during the Voting Agreement Term that such Permitted Transferee shall
agree in writing to be subject to and bound by all restrictions and obligations
set forth in this Section 5.1.

In the event the Company’s stockholders are permitted to act by written consent,
the Company and the Investor shall each negotiate in good faith with the other
provisions as consistent as possible with the foregoing to govern the voting of
the Investor’s and its Permitted Transferees’ Shares of Then Outstanding Common
Stock as closely as practicable to the foregoing.

5.2Certain Extraordinary Matters.  The Investor and its Permitted Transferees
may vote, or execute a written consent with respect to, any or all of the voting
securities of the Company as to which they are entitled to vote or execute a
written consent, as they may determine in their sole discretion, with respect to
the following matters (each such matter being an “Extraordinary Matter”):

(a)any transaction which would result in a Change of Control of the Company; and

(b)any liquidation or dissolution of the Company.

5.3Quorum.  In furtherance of Section 5.1, the Investor shall be, and shall
cause each of its Permitted Transferees to be, present in person or represented
by proxy at all meetings of stockholders to the extent necessary so that all
voting securities of the Company as to which they are entitled to vote shall be
counted as present for the purpose of determining the presence of a quorum at
such meeting.

6.Termination of Certain Rights and Obligations.

6.1Termination of Registration Rights.  Except for Section 2.7, which shall
survive until the expiration of any applicable statutes of limitation, Section 2
shall terminate automatically and have no further force or effect upon the
earliest to occur of:

(a)the expiration of the Effectiveness Period;

(b)the forfeiture of the Investor’s registration rights pursuant to Section
2.1(c);

(c)a liquidation or dissolution of the Company; and

(d)the date on which the Common Stock ceases to be registered pursuant to
Section 12 of the Exchange Act.

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6.2Termination of Standstill Term.  Section 3 shall terminate and have no
further force or effect upon the earliest to occur of:

(a)the date that is eighteen (18) months after the Closing Date;

(b)the Standstill Parties cease to hold any Shares of Outstanding Common Stock;

(c)a liquidation or dissolution of the Company; and

(d)the date on which the Common Stock ceases to be registered pursuant to
Section 12 of the Exchange Act.

6.3Termination of Lock-Up Term.  Section 4.1 shall terminate and have no further
force or effect upon the earliest to occur of:

(a)the date that is six (6) months after the Closing Date;

(b) a Change of Control of the Company;

(c)the Standstill Parties cease to hold any Shares of Outstanding Common Stock;

(d)a liquidation or dissolution of the Company; and

(e)the date on which the Common Stock ceases to be registered pursuant to
Section 12 of the Exchange Act.

6.4Termination of Voting Agreement Term.  Section 5 shall terminate and have no
further force or effect upon the earliest to occur of:

(a)the date that is eighteen (18) months after the Closing Date;

(b)a Change of Control of the Company;

(c)the Standstill Parties cease to hold any Shares of Outstanding Common Stock;
and

(d)a liquidation or dissolution of the Company.

6.5Effect of Termination.  No termination pursuant to any of Sections 6.1, 6.2,
6.3 or 6.4 shall relieve any of the parties (or the Permitted Transferee, if
any) for liability for breach of or default under any of their respective
obligations or restrictions under any terminated provision of this Agreement,
which breach or default arose out of events or circumstances occurring or
existing prior to the date of such termination.

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7.Miscellaneous.

7.1Governing Law; Submission to Jurisdiction; Waiver of Jury Trial.  All issues
and questions concerning the application, construction, validity, interpretation
and enforcement of this Agreement shall be governed by and construed in
accordance with the internal laws of the State of Delaware, without giving
effect to any choice or conflict of law provision or rule (whether of the State
of Delaware or any other jurisdiction) that would cause the application of laws
of any jurisdiction other than those of the State of Delaware. Except as
expressly set forth herein, the parties hereby agree that any suit, action or
proceeding seeking to enforce any provision of, or based on any matter arising
out of or in connection with, this Agreement or the transactions contemplated
hereby, whether in contract, tort or otherwise, shall be brought in the United
States District Court for the District of Delaware or in the Court of Chancery
of the State of Delaware (or, if such court lacks subject matter jurisdiction,
in the Superior Court of the State of Delaware), so long as one of such courts
shall have subject-matter jurisdiction over such suit, action or proceeding, and
that any cause of action arising out of this Agreement shall be deemed to have
arisen from a transaction of business in the State of Delaware.  Each of the
parties hereby irrevocably consents to the jurisdiction of such courts (and of
the appropriate appellate courts therefrom) in any such suit, action or
proceeding and irrevocably waives, to the fullest extent permitted by law, any
objection that it may now or hereafter have to the laying of the venue of any
such suit, action or proceeding in any such court or that any such suit, action
or proceeding which is brought in any such court has been brought in an
inconvenient forum.  Service of process, summons, notice or other document by
registered mail to the address set forth in Section 7.4 shall be effective
service of process for any suit, action or other proceeding brought in any such
court. Each party hereby acknowledges and agrees that any controversy which may
arise under this Agreement is likely to involve complicated and difficult issues
and, therefore, each such party irrevocably and unconditionally waives any right
it may have to a trial by jury in respect of any legal action arising out of or
relating to this Agreement or the transactions contemplated hereby.

7.2Extension; Waiver.  The failure of any party to insist upon strict
performance of a covenant hereunder or of any obligation hereunder, irrespective
of the length of time for which such failure continues, shall not be a waiver of
such party’s right to demand strict compliance herewith in the future.  No
consent or waiver, express or implied, to or of any breach or default in the
performance of any obligation hereunder, shall constitute a consent or waiver to
or of any other breach or default in the performance of the same or any other
obligation hereunder.  Any agreement on the part of a party to any extension or
waiver shall be valid only if set forth in a written instrument signed on behalf
of the party against which such waiver or extension is to be enforced.  Waiver
of any term or condition of this Agreement by a party shall not be construed as
a waiver of any subsequent breach or waiver of the same term or condition by
such party, or a waiver of any other term or condition of this Agreement by such
party.

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7.3No Agreement Until Executed.  Irrespective of negotiations among the parties
or the exchanging of drafts of this Agreement, this Agreement shall not
constitute or be deemed to evidence a contract, agreement, arrangement or
understanding among the parties unless and until this Agreement is executed and
delivered by the parties.

7.4Notices.  All notices, requests, consents, claims, demands, waivers and other
communications hereunder shall be in writing and shall be deemed to have been
given:  (a) when delivered by hand (with written confirmation of receipt); (b)
when received by the addressee if sent by a nationally recognized overnight
courier (receipt requested); (c) on the date sent by e-mail of a PDF document
(with confirmation of transmission) if sent during normal business hours of the
recipient, and on the next Business Day if sent after normal business hours of
the recipient; or (d) on the third day after the date mailed, by certified or
registered mail, return receipt requested, postage prepaid.  Such communications
must be sent to the respective parties at the following addresses (or at such
other address for a party as shall be specified in a notice given in accordance
with this Section 7.4):

 

If to the Investor:

Bayer AG

 

Kaiser-Wilhelm-Allee 20

 

51373 Leverkusen

 

Germany

 

Attention:  Dr. Christian Bank, LL.M.

 

Email:  christian.bank@bayer.com

 

 

with a copy to:

Orrick, Herrington & Sutcliffe LLP
1000 Marsh Road
Menlo Park, CA 94025
Attention:  Matthew R. Gemello

 

If to the Company:

Arvinas, Inc.

 

5 Science Park

 

395 Winchester Ave.

 

New Haven, Connecticut 06511

 

Attention: Matthew Batters, Esq.

 

 

with a copy to:

Wilmer Cutler Pickering Hale and Dorr LLP
7 World Trade Center
250 Greenwich Street
New York, NY 10007
Attention:  Brian A. Johnson

 

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7.5Miscellaneous.  This Agreement, the Purchase Agreement, the Transaction
Documents (as defined in the Commitment Agreement), the Collaboration Agreement
and any documents executed by the parties simultaneously herewith or pursuant
thereto, constitute the entire agreement of the parties with respect to the
subject matter hereof and supersedes all prior arrangements and understandings,
written or oral, among the parties with respect to the subject matter
hereof.  This Agreement may be executed in counterparts, each of which shall be
deemed an original, but all of which together shall be deemed to be one and the
same agreement.  A signed copy of this Agreement delivered by facsimile, e-mail
or other means of electronic transmission shall be deemed to have the same legal
effect as delivery of an original signed copy of this Agreement.

7.6Amendments.  No provision in this Agreement shall be supplemented, deleted or
amended except in a writing executed by an authorized representative of each of
the Investor and the Company.

7.7Interpretation.  For purposes of this Agreement:  (a) the words “include,”
“includes” and “including” shall be deemed to be followed by the words “without
limitation”; (b) the word “or” is not exclusive; (c) the words “herein,”
“hereof,” “hereby,” “hereto” and “hereunder” refer to this Agreement as a whole;
and (d) the words “will” and “shall” are to be interpreted as having the same
meaning.  The definitions given for any defined terms in this Agreement shall
apply equally to both the singular and plural forms of the terms
defined.  Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms.  Unless the context
otherwise requires, references herein:  (x) to Articles, Sections and Exhibits
mean the Articles and Sections of, and Exhibits attached to, this Agreement; (y)
to an agreement, instrument or other document means such agreement, instrument
or other document as amended, supplemented and modified from time to time to the
extent permitted by the provisions thereof; and (z) to a statute means such
statute as amended from time to time and includes any successor legislation
thereto and any regulations promulgated thereunder.  This Agreement shall be
construed without regard to any presumption or rule requiring construction or
interpretation against the party drafting an instrument or causing any
instrument to be drafted.  The Exhibits referred to herein shall be construed
with, and as an integral part of, this Agreement to the same extent as if they
were set forth verbatim herein.  The word “dollar” or symbol “$” refer to the
lawful currency of the United States of America. The headings in this Agreement
are inserted for convenience or reference only and are in no way intended to
describe, interpret, define, or limit the scope, extent or intent of this
Agreement or any provision of this Agreement in accordance herewith.

7.8Severability.  If any term or provision of this Agreement is held to be
invalid, illegal or unenforceable under applicable Law in any jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other term or
provision of this Agreement or invalidate or render unenforceable such term or
provision in any other jurisdiction.  Upon such determination that any term or
other provision is invalid, illegal or unenforceable, the parties shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in a mutually acceptable manner in
order that the transactions contemplated hereby be consummated as originally
contemplated to the greatest extent possible.

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7.9Assignment.  Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by either party without the prior
written consent of the other party.  Subject to the prior sentence, this
Agreement shall be binding upon and shall inure to the benefit of the parties
and their respective heirs, executors, administrators, successors and assigns.

7.10Third Party Beneficiaries.  None of the provisions of this Agreement shall
be for the benefit of or enforceable by any Third Party, including any creditor
of any party hereto.  No Third Party shall obtain any right under any provision
of this Agreement or shall by reason of any such provision make any claim in
respect of any debt, liability or obligation (or otherwise) against any party
hereto.

7.11No Strict Construction.  This Agreement has been prepared jointly and shall
not be construed against either party.

7.12Equitable Remedies.  Each party acknowledges that a breach or threatened
breach by such party of any of its obligations under this Agreement would give
rise to irreparable harm to the other party, for which monetary damages would
not be an adequate remedy, and hereby agrees that in the event of a breach or a
threatened breach by such party of any such obligations, the other party shall,
in addition to any and all other rights and remedies that may be available to
them in respect of such breach, be entitled to equitable relief, including a
temporary restraining order, an injunction, specific performance and any other
relief that may be available from a court of competent jurisdiction (without any
requirement to post bond).

7.13Remedies Cumulative.  The rights and remedies under this Agreement are
cumulative and are in addition to and not in substitution for any other rights
and remedies available at law or in equity or otherwise.

7.14No Conflicting Agreements.  The Investor hereby represents and warrants to
the Company that neither it nor any of its Affiliates is, as of the date of this
Agreement, a party to, and agrees that neither it nor any of its Affiliates
shall, on or after the date of this Agreement, enter into any agreement that
conflicts with the rights granted to the Company in this Agreement.  The Company
hereby represents and warrants to the Investor that it is not, as of the date of
this Agreement, a party to, and agrees that it shall not, on or after the date
of this Agreement, enter into any agreement, or approve any amendment to its
charter or by-laws or similar organizational documents of the Company with
respect to its securities, that conflicts with the rights granted to the
Investor in this Agreement which have not expired or been terminated in
accordance with the terms hereof.  The Company further represents and warrants
that the rights granted to the Investor hereunder do not in any way conflict
with the rights granted to any other holder of the Company’s securities under
any other agreements.

7.15Use of Proceeds.  The Company shall use the proceeds from the sale of the
Purchased Shares for research and development and other working capital purposes
and shall not use such proceeds for the redemption of any shares of Common Stock
or for the payment of any dividends on shares of Common Stock.

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7.16No Publicity.  The parties hereto agree that the provisions of Section 4.3
of the Commitment Agreement (mutatis mutandis) and Section 11.01(d) of that
certain Amended and Restated Limited Liability Company Agreement (mutatis
mutandis) to be entered into in connection with the Joint Venture (as amended,
restated, supplemented and/or otherwise modified from time to time, the “LLC
Agreement”) shall be applicable to the parties to this Agreement with respect to
any public disclosures regarding the Purchase Agreement, the Joint Venture, and
the Collaboration Agreement or regarding the parties hereto or their Affiliates
(it being understood that the provisions of Section 4.3 of the Commitment
Agreement and Section 11.01(d) of the LLC Agreement shall be read to apply to
disclosures of information relating to this Agreement and the transactions
contemplated hereby).

7.17Limitation of Liability.  IN NO EVENT WILL EITHER PARTY BE LIABLE TO THE
OTHER PARTY (OR THE OTHER PARTY’S AFFILIATES OR SUBLICENSEES) IN CONNECTION WITH
THIS AGREEMENT FOR LOST REVENUE, LOST PROFITS, LOST SAVINGS, LOSS OF USE, DAMAGE
TO GOODWILL, OR ANY CONSEQUENTIAL, INCIDENTAL, SPECIAL, EXEMPLARY, PUNITIVE OR
INDIRECT DAMAGES UNDER ANY THEORY, INCLUDING CONTRACT, NEGLIGENCE, OR STRICT
LIABILITY, EVEN IF THAT PARTY HAS BEEN PLACED ON NOTICE OF THE POSSIBILITY OF
SUCH DAMAGES.

7.18Commitment Agreement and Collaboration Agreement.  Each of the Commitment
Agreement and the Collaboration Agreement (and any related agreements entered
into in connection with the transactions contemplated thereby) are intended to
be separate arrangements among the parties thereto and are only referenced
herein for purposes of the Closing (as defined in the Purchase
Agreement).  Except as expressly provided herein, in no event shall the terms
set forth herein limit or otherwise apply to the Collaboration Agreement, the
Commitment Agreement, or any other related agreement and/or any transaction
contemplated thereby.

(Signature Page Follows)

 

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IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of
the date first above written.

 

BAYER AG

 

 

 

 

By:

 

/s/ Christian Bank

Name:

 

Dr. Christian Bank

Title:

 

Head of Legal M&A

 

 

By:

 

/s/ Jörg Möller

Name:

 

Jörg Möller

Title:

 

Head of PH Research & Development

 

 

ARVINAS, INC.

 

 

 

 

 

 

By:

 

/s/ John Houston

Name:

 

John Houston, Ph.D.

Title:

 

President & CEO

 

 

 

[Signature Page to Investor Agreement]

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EXHIBIT A

FORM OF IRREVOCABLE PROXY

In order to secure the performance of the duties of the undersigned pursuant to
Section 5.1 of the Investor Agreement, dated as of July 16, 2019 (the
“Agreement”), by and between Bayer AG and Arvinas, Inc. (the “Company”), the
undersigned hereby irrevocably appoints the Company and any individual
designated by the Company, and each of them individually, as the attorneys,
agents and proxies, with full power of substitution and resubstitution in each
of them, for the undersigned, and in the name, place and stead of the
undersigned, to vote (or cause to be voted) in such manner as set forth in
Section 5.1 of the Agreement (but in any case excluding any matter that is an
Extraordinary Matter described in Section 5.2) with respect to all Purchased
Shares, which the undersigned is or may be entitled to vote at any meeting of
the Company held after the date hereof, whether annual or special and whether or
not an adjourned meeting.  This proxy is coupled with an interest, shall be
irrevocable and binding on any successor-in-interest of the undersigned and
shall not be terminated by operation of law upon the occurrence of any
event.  This proxy shall operate to revoke and render void any prior proxy as to
voting securities heretofore granted by the undersigned which is inconsistent
herewith.  Notwithstanding the foregoing, this irrevocable proxy shall be
effective if, at any annual or special meeting of the stockholders of the
Company (or any consent in lieu thereof) and at any adjournments or
postponements of any such meetings, the undersigned (i) fails to appear or
otherwise fails to cause its voting securities of the Company to be counted as
present for purposes of calculating a quorum, or (ii) fails to vote such voting
securities in accordance with Section 5.1 of the Agreement, in each case at
least two (2) Business Days prior to the date of such stockholders’
meeting.  This proxy shall terminate upon the earlier of the expiration or
termination of the Voting Agreement Term.

 

BAYER AG

 

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

 

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EXHIBIT B

Plan of Distribution

The selling stockholders, which as used herein includes donees, pledgees,
transferees or other successors-in-interest selling shares of common stock or
interests in shares of common stock received after the date of this prospectus
from a selling stockholder as a gift, pledge, partnership distribution or other
transfer, may, from time to time, sell, transfer or otherwise dispose of any or
all of their shares of common stock or interests in shares of common stock on
any stock exchange, market or trading facility on which the shares are traded or
in private transactions.  These dispositions may be at fixed prices, at
prevailing market prices at the time of sale, at prices related to the
prevailing market price, at varying prices determined at the time of sale, or at
negotiated prices.

The selling stockholders may use any one or more of the following methods when
disposing of shares or interests therein:

– ordinary brokerage transactions and transactions in which the broker-dealer
solicits purchasers;

– block trades in which the broker-dealer will attempt to sell the shares as
agent, but may position and resell a portion of the block as principal to
facilitate the transaction;

– purchases by a broker-dealer as principal and resale by the broker-dealer for
its account;

– an exchange distribution in accordance with the rules of the applicable
exchange;

– privately negotiated transactions;

– short sales effected after the date the registration statement of which this
prospectus is a part is declared effective by the SEC;

– through the writing or settlement of options or other hedging transactions,
whether through an options exchange or otherwise;

– broker-dealers may agree with the selling stockholders to sell a specified
number of such shares at a stipulated price per share;

– a combination of any such methods of sale; and

– any other method permitted by applicable law.

The selling stockholders may, from time to time, pledge or grant a security
interest in some or all of the shares of common stock owned by them and, if they
default in the performance of their secured obligations, the pledgees or secured
parties may offer and sell the shares of common stock, from time to time, under
this prospectus, or under an amendment to this prospectus under Rule 424(b)(3)
or other applicable provision of the Securities Act of 1933, as amended (the
“Securities Act”), amending the list of selling stockholders to include the
pledgee, transferee or

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other successors in interest as selling stockholders under this prospectus.  The
selling stockholders also may transfer the shares of common stock in other
circumstances, in which case the transferees, pledgees or other successors in
interest will be the selling beneficial owners for purposes of this prospectus.

In connection with the sale of common stock or interests therein, the selling
stockholders may enter into hedging transactions with broker-dealers or other
financial institutions, which may in turn engage in short sales of the common
stock in the course of hedging the positions they assume.  The selling
stockholders may also sell shares of common stock short and deliver these
securities to close out their short positions, or loan or pledge the common
stock to broker-dealers that in turn may sell these securities.  The selling
stockholders may also enter into option or other transactions with
broker-dealers or other financial institutions or the creation of one or more
derivative securities which require the delivery to such broker-dealer or other
financial institution of shares offered by this prospectus, which shares such
broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction).

The aggregate proceeds to the selling stockholders from the sale of the common
stock offered by them will be the purchase price of the common stock less
discounts or commissions, if any.  Each of the selling stockholders reserves the
right to accept and, together with their agents from time to time, to reject, in
whole or in part, any proposed purchase of common stock to be made directly or
through agents.  We will not receive any of the proceeds from this offering.  

The selling stockholders also may resell all or a portion of the shares in open
market transactions in reliance upon Rule 144 under the Securities Act, provided
that they meet the criteria and conform to the requirements of that rule.

The selling stockholders and any underwriters, broker-dealers or agents that
participate in the sale of the common stock or interests therein may be
“underwriters” within the meaning of Section 2(11) of the Securities Act.  Any
discounts, commissions, concessions or profit they earn on any resale of the
shares may be underwriting discounts and commissions under the Securities
Act.  Selling stockholders who are “underwriters” within the meaning of
Section 2(11) of the Securities Act will be subject to the prospectus delivery
requirements of the Securities Act.

To the extent required, the shares of our common stock to be sold, the names of
the selling stockholders, the respective purchase prices and public offering
prices, the names of any agents, dealer or underwriter, and any applicable
commissions or discounts with respect to a particular offer will be set forth in
an accompanying prospectus supplement or, if appropriate, a post-effective
amendment to the registration statement that includes this prospectus.

In order to comply with the securities laws of some states, if applicable, the
common stock may be sold in these jurisdictions only through registered or
licensed brokers or dealers.  In addition, in some states the common stock may
not be sold unless it has been registered or qualified for sale or an exemption
from registration or qualification requirements is available and is complied
with.

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We have advised the selling stockholders that the anti-manipulation rules of
Regulation M promulgated under the Securities Exchange Act of 1934, as amended,
may apply to sales of shares in the market and to the activities of the selling
stockholders and their affiliates.  In addition, to the extent applicable we
will make copies of this prospectus (as it may be supplemented or amended from
time to time) available to the selling stockholders for the purpose of
satisfying the prospectus delivery requirements of the Securities Act.  The
selling stockholders may indemnify any broker-dealer that participates in
transactions involving the sale of the shares against certain liabilities,
including liabilities arising under the Securities Act.

We have agreed to indemnify the selling stockholders against liabilities,
including liabilities under the Securities Act and state securities laws,
relating to the registration of the shares offered by this prospectus.

We have agreed with the selling stockholders to keep the registration statement
of which this prospectus constitutes a part effective until the earlier of
(1) such time as all of the shares covered by this prospectus and actually
issued or issuable upon conversion of the Notes have been sold and (2) the date
on which all of the shares may be sold without restriction pursuant to Rule 144
of the Securities Act.

* * * * *

 

 

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