EX-10.1






EXHIBIT 10.1




COMMON STOCK PURCHASE AGREEMENT




COMMON STOCK PURCHASE AGREEMENT (this “Agreement”) dated as of December 19, 2006,
between ALTUS PHARMACEUTICALS INC., a Delaware corporation (the “Company”), and GENENTECH,
INC. (the “Purchaser”).



WHEREAS, the parties hereto are simultaneously entering into a Collaboration and License
Agreement (the “Collaboration Agreement”); and



WHEREAS, in connection with the transactions contemplated by the Collaboration Agreement, the
Purchaser desires to purchase from the Company, and the Company desires to issue and sell to the
Purchaser, shares of Common Stock, $0.01 par value per share (the “Common Stock”), of the
Company.



NOW, THEREFORE, in consideration of the mutual promises hereinafter set forth and other good
and valuable consideration, the receipt of which is hereby acknowledged, the parties hereby agree
as follows:




	 	1.	 	Purchase and Sale of the Shares.





(a) Subject to the terms and conditions of this Agreement, at the Closing (as defined in
clause (b) below), the Company will issue and sell to the Purchaser, and the Purchaser will
purchase from the Company, 794,575 shares (the “Shares”) of Common Stock of the Company for
an aggregate purchase price of $15,000,000 (the “Purchase Price”). For the sake of
clarification only, the per share price used to calculate such number of Shares is equal to the
average of the reported last sale price of the Common Stock on the Nasdaq Global Market from
November 28, 2006 through December 18, 2006. The number of Shares to be issued to the Purchaser
hereunder shall be adjusted to reflect fully the effect of any reclassification, stock split,
reverse split, stock dividend, reorganization, recapitalization or other like change with respect
to Common Stock of the Company occurring after the date hereof and prior to the Closing.



(b) The closing of the transactions contemplated hereby (the “Closing”) shall take
place at 10:00 a.m., Eastern time, on a date to be specified by the Company and the Purchaser (the
“Closing Date”), which shall be no later than the fifth business day after satisfaction or
waiver of the conditions to the Closing set forth in Section 4 of this Agreement, remotely via the
exchange of documents and signatures, unless another date, place or time is agreed to in writing by
the Purchaser and the Company. The respective obligations of the parties to this Agreement to
effect the transactions contemplated hereby shall be subject to the delivery of the following at
the Closing:



(i) the Company and the Purchaser shall execute and deliver the Registration Rights Agreement
in the form attached hereto as Exhibit A (the “Registration Rights Agreement”);



(ii) US1DOCS 5965865v8



the Company shall deliver to the Purchaser a certificate of its Secretary or Assistant
Secretary attesting as to the resolutions of the Board of Directors of the Company relating to the
sale of the Shares;



(iii) the Company shall deliver to the Purchaser a certificate as to the corporate good
standing of the Company issued by the Secretary of State of the State of Delaware;



(iv) Wilmer Cutler Pickering Hale and Dorr LLP, counsel for the Company, shall deliver to the
Purchaser an opinion, dated the Closing Date, in substantially the form attached hereto as
Exhibit B;



(v) the Purchaser shall pay the Purchase Price to the Company by wire transfer of immediately
available funds to an account designated by the Company; and



(vi) the Company shall instruct the transfer agent for the Common Stock to issue and promptly
deliver to the Purchaser a stock certificate representing the Shares.



2. Representations and Warranties of the Company. The Company represents and warrants
to the Purchaser that the statements contained in this Section 2 are true and correct as of the
date hereof.



(a) Organization and Good Standing. The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware. The Company has the
corporate power and authority to enter into and perform its obligations under this Agreement and
the Registration Rights Agreement, to own and operate its properties and assets and to carry on its
business as currently conducted and as presently proposed to be conducted.



(b) Authorization and Binding Nature. The execution, delivery and performance by the
Company of this Agreement and the Registration Rights Agreement and the issuance and delivery of
the Shares has been duly authorized by all requisite corporate action on the part of the Company
and this Agreement and the Registration Rights Agreement constitute valid and legally binding
obligations of the Company, enforceable against the Company in accordance with their respective
terms, except (i) as may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting the enforcement of creditors’ rights
generally and (ii) as may be limited by laws relating to the availability of specific performance,
injunctive relief or other equitable remedies.



(c) Non-Contravention. The execution, delivery and performance by the Company of this
Agreement and the Registration Rights Agreement will not, with or without the giving of notice or
the passage of time or both, (i) violate or conflict with the provisions of the certificate of
incorporation or bylaws of the Company, (ii) violate or conflict with any judgment, decree, order
or award of any court, governmental body or arbitrator applicable to the Company, or (iii) violate
or conflict with any material agreement to which the Company is a party or by which it is bound.



(d) Governmental Consents. No consent, approval, order or authorization of, or
registration, qualification, designation, declaration or filing with, any federal, state or local
governmental authority is required on the part of the Company in order to enable the Company to
execute, deliver and perform its obligations under this Agreement, or to execute and deliver the
Registration Rights Agreement, except for such qualifications or filings under applicable
securities laws as may be required to be made after the Closing in connection with the transactions
contemplated by this Agreement.



(e) Authorization of Shares. When issued, sold and delivered in accordance with the
provisions of this Agreement for the consideration expressed herein, the Shares will be duly
authorized, validly issued, fully paid and nonassessable, and will be free of restrictions on
transfer other than restrictions under this Agreement, the Registration Rights Agreement and
applicable state and federal securities laws.



(f) SEC Reports. The Company has previously furnished or made available to the
Purchaser (i) its Annual Report on Form 10-K for the fiscal year ended December 31, 2005, as
amended, as filed with the Securities and Exchange Commission (the “SEC”), and (ii) all
other reports filed by the Company with the SEC under Section 13 or subsections (a) and (c) of
Section 14 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) since
January 1, 2006 (such reports are collectively referred to herein as the “Reports”). The
Reports constitute all of the documents required to be filed by the Company under Section 13 or
subsections (a) and (c) of Section 14 of the Exchange Act with the SEC from January 1, 2006 through
the date of this Agreement. The Reports complied in all material respects with the requirements of
the Exchange Act and the rules and regulations thereunder when filed. The Reports, when considered
together, do not contain any 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 light of the
circumstances under which they were made, not misleading.



3. Representations and Warranties of the Purchaser. The Purchaser represents and
warrants to the Company that the statements contained in this Section 3 are true and correct as of
the date hereof.



(a) Corporate Power. The Purchaser has the corporate power and authority to enter
into and perform its obligations under this Agreement and the Registration Rights Agreement. The
Purchaser has not been organized, reorganized or recapitalized for the purpose of investing in the
Company.



(b) Authorization and Binding Nature. The execution, delivery and performance by the
Purchaser of this Agreement and the Registration Rights Agreement have been duly authorized by all
requisite corporate action on the part of the Purchaser and this Agreement and the Registration
Rights Agreement constitute valid and legally binding obligations of the Purchaser, enforceable
against the Purchaser in accordance with their respective terms, except (i) as may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application
affecting the enforcement of creditors’ rights generally and (ii) as may be limited by laws
relating to the availability of specific performance, injunctive relief or other equitable
remedies.



(c) Non-Contravention. The execution, delivery and performance by the Purchaser of
this Agreement will not, with or without the giving of notice or the passage of time or both, (i)
violate the provisions of the certificate of incorporation or bylaws of the Purchaser, (ii) violate
any judgment, decree, order or award of any court, governmental body or arbitrator applicable to
the Purchaser, or (iii) conflict with or violate any material agreement to which the Purchaser is a
party or by which it is bound.



(d) Accredited Investor. The Purchaser is an “accredited investor,” as defined in
Rule 501 under the Securities Act.



(e) Investment. The Purchaser is acquiring the Shares for its own account for
investment, not for resale to any other person and not with a view to or in connection with any
resale or distribution. The Purchaser understands that the Shares have not been registered under
the securities laws of the United States or any other jurisdiction and cannot be transferred or
resold except as permitted pursuant to a valid registration statement or an applicable exemption
from registration. The Purchaser acknowledges that the Company has not made any representations
with respect to registration of the Shares under applicable securities laws, that there can be no
assurance that any market for the Common Stock will continue into the foreseeable future and that,
as a result, the Purchaser must be prepared to bear the economic risk of its investment for an
indefinite period of time.



(f) Access to Information. The Purchaser has substantial knowledge and experience in
making investment decisions of this type and is capable of evaluating the merits and risks of its
investment in the Company. The Company has made available to the Purchaser all documents and other
information necessary for the Purchaser to evaluate the merits and risks of its investment in the
Company. The Company has made available to the Purchaser all documents requested and has provided
answers to all of its questions relating to an investment in the Company. In evaluating the
suitability of an investment in the Company, the Purchaser has not relied upon any representations
(whether oral or written) other than as set forth herein. The Purchaser has had an opportunity to
discuss this investment with representatives of the Company and to ask questions of them. The
Purchaser understands that an investment in the Company involves significant risks.



4. Conditions to Closing.



(a) Conditions to Obligations of the Purchaser. The Purchaser shall have no
obligation to effect the transactions contemplated hereby until the Effective Date (as such term is
defined in the Collaboration Agreement), at which time the obligations of the Purchaser to effect
the transactions contemplated hereby shall be subject to the delivery by the Company at the Closing
of the items identified in Section 1(b) of this Agreement and the satisfaction on or prior to the
Closing Date of each of the following additional conditions, any of which may be waived, in
writing, exclusively by the Purchaser:



(i) The representations and warranties of the Company set forth in this Agreement shall be
true and correct as of the Closing Date as though made on and as of the Closing Date (except (A) to
the extent such representations and warranties are specifically made as of a particular date, in
which case such representations and warranties shall be true and correct as of such date and
(B) where the failure to be true and correct, individually or in the aggregate, has not had a
Material Adverse Effect); and the Purchaser shall have received a certificate signed on behalf of
the Company by the chief executive officer or the chief financial officer of the Company to such
effect. For purposes of this Agreement, the term “Material Adverse Effect” means a
material adverse change in the business, financial condition or results of operations of the
Company and its subsidiaries, taken as a whole; provided, however, that none of the following shall
constitute, or shall be considered in determining whether there has occurred, a Material Adverse
Effect: (1) changes that are the result of economic factors affecting the national, regional or
world economy or acts of war or terrorism; (2) changes that are the result of factors generally
affecting the industries or markets in which the Company operates; (3) any adverse change arising
out of or resulting from actions contemplated by the parties in connection with this Agreement or
the Collaboration Agreement or the pendency or announcement of the transactions contemplated by
this Agreement or the Collaboration Agreement, including without limitation actions of
collaborators, competitors or employees; (4) changes in law, rules or regulations or generally
accepted accounting principles or the interpretation thereof; (5) any action taken pursuant to or
in accordance with this Agreement or the Collaboration Agreement or at the request of the
Purchaser; (6) any failure by the Company to meet any published securities analyst estimates of
revenues, earnings, expenses or amount of cash for any period ending on or after the date of this
Agreement and prior to the Closing; (7) any loss of collaborators or other business relationships
resulting directly or indirectly from the announcement of the transactions contemplated by this
Agreement or the Collaboration Agreement; (8) any stockholder litigation; and (9) a decline in the
price of the Common Stock of the Company.



(ii) The Collaboration Agreement shall not have been terminated prior to the Closing.



(b) Conditions to Obligations of the Company. The Company shall have no obligation to
effect the transactions contemplated hereby until the Effective Date, at which time the obligations
of the Company to effect the transactions contemplated hereby shall be subject to the delivery by
the Purchaser at the Closing of the items identified in Section 1(b) of this Agreement and the
satisfaction on or prior to the Closing Date of each of the following additional conditions, any of
which may be waived, in writing, exclusively by the Company:



(i) The representations and warranties of the Purchaser set forth in this Agreement shall be
true and correct in all material respects as of the Closing Date as though made on and as of the
Closing Date; and the Company shall have received a certificate signed on behalf of the Purchaser
by an officer of the Company to such effect.



(ii) The Collaboration Agreement shall not have been terminated prior to the Closing.



5. Closing Efforts. Each of the Company and the Purchaser shall use reasonable
commercial efforts to consummate the transactions contemplated by this Agreement.



6. Termination. This Agreement may be terminated (i) at any time by mutual written
consent of the Company and the Purchaser, (ii) by either party if the Collaboration Agreement has
been terminated for any reason prior to the Closing or (iii) by either party if the Closing has not
occurred within 30 days after the Effective Date. In the event that this Agreement is terminated,
the respective obligations of the Company and the Purchaser to sell and purchase the Shares and as
otherwise provided in this Agreement shall become void and be of no further force or effect,
provided that any such termination shall not relieve any party from liability for any breach by
such party, prior to the termination of this Agreement, of any covenant or agreement (but not any
representation or warranty) contained in this Agreement or impair the right of any party to obtain
such remedies as may be available to it in law or equity with respect to such a breach by any other
party.



7. Opinions and Legends. The Purchaser agrees that the Shares shall not be sold or
transferred unless: (i) the Shares shall first have been registered under the Securities Act, (ii)
the Shares are sold pursuant to Rule 144 under the Securities Act of 1933, as amended (the
“Securities Act”) and the Company is furnished with an opinion of counsel reasonably
satisfactory to the Company to the effect that such sale or transfer is exempt from the
registration requirements of the Securities Act or (iii) the Company shall first have been
furnished with an opinion of counsel reasonably satisfactory to the Company to the effect that such
sale or transfer is exempt from the registration requirements of the Securities Act. The Purchaser
understands that the certificate representing the Shares shall bear a legend substantially in the
following form:



“The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended, and may not
be sold, exchanged, transferred, pledged, hypothecated or otherwise
disposed of unless and until such securities are registered under
such Act or an opinion of counsel satisfactory to the issuer is
obtained to the effect that such registration is not required.”



Promptly after a request from the Purchaser, the foregoing legend shall be removed and the Company
shall issue a certificate without such legend to the holder of any Shares upon which it is stamped,
if, unless otherwise required by state securities laws, (i) the Shares are resold under an
effective registration statement under the Securities Act or (ii) the Shares are eligible for
resale pursuant to Rule 144(k) of the Securities Act and the Company is furnished with an opinion
of counsel reasonably satisfactory to the Company to such effect.



8. Miscellaneous.



(a) Notices. Any notices or other communications required or permitted hereunder
shall be sufficiently given if delivered personally or sent by facsimile or with a reputable
express courier, with charges prepaid, to the address set forth below or to such other address of
which the parties may have given notice. Unless otherwise specified herein, such notices or other
communications shall be deemed received one business day after personal delivery or delivery by
facsimile, or three business days after being sent, if sent by reputable express courier.



If to the Company:



Altus Pharmaceuticals Inc.



125 Sidney Street



Cambridge, Massachusetts 02139



Attention: General Counsel



Facsimile No.: (617) 299-2999



with a copy to:



WilmerHale



60 State Street



Boston, Massachusetts 02109



Attention: Peter N. Handrinos, Esq.



Facsimile No.: (617) 526-5000



If to the Purchaser:



Genentech, Inc.



1 DNA Way



South San Francisco, California 94080



Attn: Corporate Secretary



Facsimile No.: (650) 467-9146



(b) Successors and Assigns. No party may assign its rights or obligations
hereunder without the prior written consent of the other party. Subject to the foregoing, this
Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Any assignment in contravention of this provision shall be void.



(c) Survival of Warranties. The representations and warranties of the Company and the
Purchaser contained in or made pursuant to this Agreement shall survive the execution and delivery
of this Agreement and the Closing for one year.



(d) Entire Agreement. This Agreement and the Registration Rights Agreement
represent the entire understanding and agreement between the parties hereto with respect to the
subject matter hereof and supersede all prior oral and written and all contemporaneous oral
negotiations, commitments and understandings between such parties. The parties may amend or modify
this Agreement, in such manner as may be agreed upon, only by a written instrument executed by the
parties hereto.



(e) Expenses. Each party shall pay its own expenses in connection with this
Agreement and the transactions contemplated hereby.



(f) Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware, without reference to conflict of laws principles, and the
parties hereby consent to the jurisdiction of the courts of the State of Delaware.



(g) Section Headings. The section headings are for the convenience of the parties
and in no way alter, modify, amend, limit or restrict the contractual obligations of the parties.



(h) Severability. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision of this Agreement.



(i) Counterparts. This Agreement may be executed in two or more counterparts, each
of which shall be deemed to be an original, but all of which shall be one and the same document.



[Remainder of Page Intentionally Left Blank]






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IN WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as of and on
the date first above written.



ALTUS PHARMACEUTICALS INC.



By: /s/ Sheldon Berkle

Name: Sheldon Berkle

Title: President and Chief Executive Officer




GENENTECH, INC.



By: /s/ Arthur D. Levinson

Name: Arthur D. Levinson

Title: Chairman and Chief Executive Officer





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