exv10w1






Exhibit 10.1




STOCK PURCHASE AGREEMENT




     THIS STOCK PURCHASE AGREEMENT (this “Agreement”) dated as of February 4, 2009 (the
“Execution Date”) between Idenix Pharmaceuticals, Inc., a company organized under the laws
of the State of Delaware with its principal place of business at 60 Hampshire Street, Cambridge,
Massachusetts 02139, USA (“Idenix”), and SmithKline Beecham Corporation, doing business as
GlaxoSmithKline, a company organized under the laws of the Commonwealth of Pennsylvania, with its
principal place of business at One Franklin Plaza, Philadelphia, Pennsylvania 19101 USA
(“GSK” and, together with Idenix, the “Parties”).



RECITALS




     WHEREAS, on the date hereof, Idenix and GSK have entered into that certain license agreement
(the “License Agreement”) pursuant to which Idenix has granted GSK an exclusive license for
certain assets as set forth therein;



     WHEREAS, the License Agreement contemplates that GSK shall (a) pay to Idenix a non-refundable,
non-creditable license fee in the amount of seventeen million U.S. Dollars (US $17,000,000); and
(b) purchase shares of Idenix’s common stock, $0.001 par value per share (the “Common
Stock”), in each case, on the Closing Date (as defined herein); and



     WHEREAS, Idenix desires to issue and sell and GSK desires to purchase shares of Common Stock,



     NOW, THEREFORE, in consideration of the respective representations, warranties, covenants and
conditions contained herein, and other good and valuable consideration, the sufficiency of which is
hereby acknowledged, the Parties agree as follows:



     1. Purchase and Sale of the Common Stock. On the terms and subject to the conditions
set forth herein, at the Closing, GSK shall pay to Idenix, an aggregate purchase price of Seventeen
Million U.S. Dollars ($17,000,000) in cash (the “Purchase Price”), by wire transfer of
immediately available funds and, in exchange therefore, Idenix shall issue and sell to GSK
2,475,728 shares of Common Stock (the “Purchased Shares”).



     2. Closing. Subject to the satisfaction or waiver of the conditions set forth in this
Agreement, the closing of the purchase of the Purchased Shares by GSK pursuant hereto (the
“Closing”) shall occur on the Effective Date (as defined in the License Agreement);
provided that if any conditions have not been so satisfied or waived on such date, the
Closing shall occur on the first Business Day after the satisfaction or waiver (by the Party
entitled to grant such waiver) of the conditions to the Closing set forth in this Agreement (other
than those conditions that by their nature are to be satisfied at the Closing, but subject to
fulfillment or waiver of those conditions), at 10:00 a.m., New York time, at the offices of Wilmer
Cutler Pickering Hale and Dorr LLP, 60 State Street,



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Boston, Massachusetts (or remotely via the exchange of signatures and documents) or such other
date or location as agreed by the Parties. The date of the Closing is referred to as the
“Closing Date.”



     3. Closing Deliveries.




(a) Subject to the satisfaction or waiver on the Closing Date of the applicable
conditions to the Closing in Section 4, at the Closing, Idenix shall deliver, or
cause to be delivered, to GSK the following:




(i) a copy of the Novartis Waiver (as defined in the License
Agreement);




(ii) a consent from the requisite number of Preference Holders (as
such term is defined in that certain amended and restated
stockholders’ agreement, dated July 27, 2004, among Idenix, Novartis
Pharma AG and certain other Idenix stockholders) (“Preference
Holders Consent”);




(iii) a certificate representing the Purchased Shares, registered in
the name of GSK;




(iv) a consent from Novartis Pharma AG relating to the issuance of the
Purchased Shares (the “Novartis Consent”) as set forth on
Exhibit A hereto;




(v) a legal opinion in the form attached as Exhibit B hereto;
and




(vi) such other documents as are required to be delivered by Idenix to
GSK pursuant to the terms of this Agreement.




(b) At the Closing, GSK shall deliver, or cause to be delivered, to Idenix the
following:




(i) the Purchase Price in cash; and




(ii) such other documents as are required to be delivered by GSK to
Idenix pursuant to the terms of this Agreement.



     4. Closing Conditions.




The respective obligations of GSK on the one hand, and Idenix, on the other hand,
to consummate the Closing are subject to the fulfillment or written waiver by GSK
and Idenix prior to the Closing of the following conditions:



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(i) each of the HSR Clearance Date and the Effective Date shall have
occurred;




(ii) no provision of any applicable law or regulation and no judgment,
injunction, order or decree shall prohibit the Closing or shall
prohibit or restrict GSK from owning the Purchased Shares and no
lawsuit shall have been commenced by a Governmental Entity seeking to
restrict such ownership; and




(iii) the Common Stock shall be listed on the NASDAQ Global Market or
such other market on which the Common Stock is then listed or quoted,
subject to official notice of issuance.



     5. Representations and Warranties of Idenix. Except as disclosed by Idenix in a
written Disclosure Schedule delivered by Idenix to GSK on or prior to the date hereof (the
“Disclosure Schedule”), which Disclosure Schedules shall be deemed a part hereof, Idenix
hereby represents and warrants to GSK that the statements contained in this Section 5 are complete
and accurate as of the Execution Date and shall be complete and accurate as of the Closing Date (or
such other date as is specified below). The Disclosure Schedule shall be arranged in sections
corresponding to the numbered and lettered sections and subsections contained in this Section 5,
and the disclosures in any section or subsection of the Disclosure Schedule shall qualify other
sections and subsections in this Section 5 to the extent it is reasonably clear from a reading of
the disclosure that such disclosure is applicable to such other sections and subsections.




(a) Corporate Organization. Idenix is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware, has
all requisite power and authority to own, lease and operate its properties and
carry on its business as it is now being conducted and is duly licensed or
qualified and is in good standing as a foreign corporation in each jurisdiction in
which the properties owned, leased or operated, or the business conducted, by it to
the extent such qualification and good standing is required by applicable law,
except for any such failure to be licensed, qualified or in good standing which,
individually or in the aggregate, would not be reasonably expected to have a
Material Adverse Effect on Idenix. Except as set forth in Section 5(a) of the
Disclosure Schedule, no subsidiary of Idenix holds or controls any material assets
or has any material liabilities that are not reflected in the financial statements
of Idenix included in Company Reports filed with the SEC prior to the date of this
Agreement.




(b) Corporate Authority. Idenix has the requisite corporate power and
authority to execute, deliver and perform this Agreement and to consummate the
transactions contemplated hereby. The execution, delivery and performance of this
Agreement by Idenix and the issuance and sale by Idenix of the Purchased Shares
have been duly authorized by



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Idenix’s Board of Directors, and no other corporate proceedings on the part of
Idenix are necessary to authorize this Agreement or (other than Idenix’s receipt of
the Novartis Consent) for Idenix to consummate the transactions as contemplated
herein. This Agreement has been duly and validly executed and delivered by Idenix
and (assuming the due authorization, execution and delivery by GSK) will constitute
a legal, valid and binding agreement of Idenix, enforceable against it in
accordance with its terms, subject as to enforcement of remedies to applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
generally the enforcement of creditors’ rights and remedies and subject to a
court’s discretionary authority with respect to the granting of a decree ordering
specific performance or other equitable remedies.




(c) No Violations; Consents and Approvals.




(i) Neither the execution, delivery or performance by Idenix of this
Agreement nor the consummation by Idenix of the transactions
contemplated hereby (A) will result in a violation or breach of
Idenix’s charter, as amended, or by-laws, as amended; (B) will result
in a violation or breach of (or give rise to any right of termination,
revocation, cancellation or acceleration under or increased payments
under), or constitute a default (with or without due notice or lapse
of time or both) under, or result in the creation of any lien,
mortgage, charge, encumbrance or security interest of any kind (a
“Lien”) upon any of the properties or assets of Idenix under
any of the terms, conditions or provisions of any note, bond,
mortgage, indenture, contract, agreement, obligation, instrument,
offer, commitment, understanding or other arrangement to which Idenix
is a party (each a “Contract”); or (C) will result in a
violation of any law, statute, ordinance, rule, regulation, permit,
concession, grant, franchise or any judgment, ruling, order, writ,
injunction or decree applicable to Idenix, except, in the case of
clauses (B) or (C), for violations, breaches, defaults, rights of
termination, revocations, cancellations or accelerations or Liens that
would not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect on Idenix.




(ii) Except for filings or consents as may be required under, and
other applicable requirements of, (A) the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the “HSR Act”); (B)
applicable securities laws; and (C) the Nasdaq Marketplace Rules, no
consent, approval, order or authorization of, or registration,
declaration or filing with, any government or any court,
administrative agency or commission



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or other governmental authority or agency, federal, state, local or
foreign (a “Governmental Entity”), is required with respect to
Idenix in connection with the execution, delivery or performance by
Idenix of this Agreement or the consummation by Idenix of the
transactions contemplated hereby, except where the failure to obtain
such consents, approvals, orders or authorizations, or to make such
filings would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect on Idenix.




(d) Capital Stock. The authorized capital stock of Idenix consists of
125,000,000 shares of Common Stock, of which 56,581,801 shares of Common Stock were
issued and outstanding as of the close of business on February 2, 2009. All of the
outstanding shares of Common Stock have been duly authorized and validly issued,
and are fully paid and nonassessable. As of February 2, 2009, Idenix had
outstanding stock options to purchase 5,542,259 shares of Common Stock and
2,234,526 shares of Common Stock are reserved for future issuance pursuant to
Idenix’s stock incentive plans. There are no preemptive or similar rights on the
part of any holders of any class of securities of Idenix and, except as set forth
in this paragraph (d), no securities convertible into or exchangeable for, or
options, warrants, calls, subscriptions, rights, contracts, commitments,
arrangements or understandings of any kind to which Idenix is a party or by which
it is bound obligating Idenix to issue, deliver or sell, or cause to be issued,
delivered or sold, additional shares of capital stock or other voting securities of
Idenix.




(e) Company Reports; Financial Statements. Idenix has timely filed all
reports, schedules, forms, statements and other documents required to be filed by
it with the SEC under the Securities Act and the Exchange Act and the U.S. Food
and Drug Administration (“FDA”) under its applicable regulations since January 1,
2007 (the “Company Reports”) and has paid all fees and assessments due and
payable in connection therewith. As of its filing date, each Company Report
complied in all material respects with all statutes and applicable rules and
regulations of the SEC or FDA, as the case may be. To the Knowledge of Idenix,
there are no outstanding comments from the SEC or the FDA with respect to any
Company Report. In the case of each such Company Report filed with or furnished to
the SEC, such Company Report, as of its date, or if amended prior to the date of
this Agreement, as of the date of such amendment (i) complied in all material
respects with the applicable requirements of the Securities Act or the Exchange
Act, as applicable, and the rules and regulations thereunder; and (ii) did not, at
the time it was filed, contain any untrue statement of a material fact or omit to
state any 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. With respect to each



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Company Report filed with the FDA, such Company Report was complete and accurate in
all material respects as of its respective date, or if amended prior to the date of
this Agreement, as of the date of such amendment. No executive officer of Idenix
has failed in any respect to make the certifications required of him or her under
Section 302 or 906 of the Sarbanes-Oxley Act of 2002. The financial statements of
Idenix included in Company Reports filed with the SEC comply in all material
respects with applicable accounting requirements and the rules and regulations of
the SEC with respect thereto as in effect at the time of filing. Such financial
statements have been prepared in accordance with GAAP applied on a consistent basis
during the periods involved, except as may be otherwise specified in such financial
statements or the notes thereto and except that unaudited financial statements may
not contain all footnotes required by GAAP, and fairly present in all material
respects the financial position of Idenix as of and for the dates thereof and the
results of operations and cash flows for the periods then ended, subject, in the
case of unaudited statements, to normal, year-end audit adjustments.




(f) Internal Controls. The records, systems, controls, data and
information of Idenix are recorded, stored, maintained and operated under means
(including any electronic, mechanical or photographic process, whether computerized
or not) that are under the exclusive ownership and direct control of Idenix
(including all means of access thereto and therefrom), except for any non-exclusive
ownership and non-direct control that would not reasonably be expected to have a
material adverse effect on the system of internal accounting controls described
below. Idenix (i) has implemented and maintains disclosure controls and procedures
(as defined in Rule 13a-15(e) of the Exchange Act) to ensure that material
information relating to Idenix is made known to the chief executive officer and the
chief financial officer of Idenix by others within Idenix; and (ii) has disclosed,
based on its most recent evaluation prior to the date hereof, to Idenix’s outside
auditors and the audit committee of the Board of Directors (A) any significant
deficiencies and material weaknesses in the design or operation of internal
controls over financial reporting (as defined in Rule 13a-15(f) of the Exchange
Act) that are reasonably likely to adversely affect Idenix’s ability to record,
process, summarize and report financial information; and (B) to the Knowledge of
Idenix, any fraud, whether or not material, that involves management or other
employees who have a significant role in Idenix’s internal controls over financial
reporting. Since December 31, 2007 and until the date of this Agreement, (i)
neither Idenix nor, to the Knowledge of Idenix, any director, officer, employee,
auditor, accountant or representative of Idenix has received or otherwise had or
obtained knowledge of any material complaint, allegation, assertion or claim,
whether written or oral, regarding the accounting or auditing practices,
procedures, methodologies or methods of Idenix or their respective internal
accounting controls, including any



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material complaint, allegation, assertion or claim that Idenix has engaged in
questionable accounting or auditing practices; and (ii) no attorney representing
Idenix, whether or not employed by Idenix, has reported evidence of a material
violation of securities laws, breach of fiduciary duty or similar violation by
Idenix or any of its officers, directors, employees or agents to the Board of
Directors or any committee thereof or to any director or officer of Idenix.




(g) Taxes.




(i) Idenix has (A) duly and timely filed (including pursuant to
applicable extensions granted without penalty) all material Tax
Returns required to be filed by it; and (B) paid in full all Taxes due
or made adequate provision in the financial statements of Idenix (in
accordance with GAAP) for any such Taxes, whether or not shown as due
on such Tax Returns.




(ii) To the Knowledge of Idenix, no material deficiencies for any
Taxes have been proposed, asserted or assessed in writing against or
with respect to any Taxes due by or Tax Returns of Idenix which
deficiencies have not since been resolved, except for Taxes proposed,
asserted or assessed that are being contested in good faith by
appropriate proceedings and for which reserves adequate in accordance
with GAAP have been provided.




(iii) There are no material Liens for Taxes upon the assets of Idenix
except for statutory liens for current Taxes not yet due or Liens for
Taxes that are being contested in good faith by appropriate
proceedings and for which reserves adequate in accordance with GAAP
have been provided.




(h) Absence of Certain Events and Changes. Except as disclosed in Company
Reports filed with the SEC prior to the date of this Agreement (excluding any risk
factor disclosures contained in such documents under the heading “Risk Factors” and
any disclosure of risks included in any “forward-looking statements” disclaimer or
other statements that are similarly non-specific and are predictive or
forward-looking in nature), since the date of filing of Idenix’s Quarterly Report
on Form 10-Q for the quarter ended September 30, 2008 with the SEC, (i) Idenix has
conducted its businesses in the ordinary course consistent with past practice; (ii)
there has not been any event, change or development which, individually or in the
aggregate, would reasonably be expected to have a Material Adverse Effect on
Idenix; (iii) Idenix has not incurred any material liabilities (contingent or
otherwise) other than trade payables and accrued expenses incurred in the ordinary
course of business consistent with past practice; and (iv) Idenix has not altered
its method of accounting in any material



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respect; and (v) Idenix has not declared or made any dividend or distribution of
cash or other property to its shareholders or purchased, redeemed or made any
agreements to purchase or redeem any shares of its capital stock.




(i) No Undisclosed Liabilities. Idenix does not have any liabilities
(contingent or otherwise), except for (i) liabilities reflected or reserved against
in financial statements of Idenix included in Company Reports filed with the SEC
prior to the date of this Agreement; and (ii) liabilities that have not had and
would not reasonably be expected to have a Material Adverse Effect on Idenix.




(j) Litigation. There are no material civil, criminal or administrative
actions, suits, or proceedings pending or, to the Knowledge of Idenix, threatened,
against Idenix or to which any of its assets are subject. There are no material
outstanding judgments, orders, decrees, or injunctions of any Governmental Entity
naming Idenix.




(k) Compliance with Laws. Idenix has all material permits, licenses,
franchises, authorizations, orders and approvals of, and has made all filings,
applications and registrations with, Governmental Entities that are required in
order to permit it to own or lease its properties and assets and to carry on its
business as presently conducted that are material to the business of Idenix.
Idenix has complied in all material respects and is not in default or violation of,
and, to the Knowledge of Idenix, is not under investigation with respect to or
threatened to be charged with or given notice of any material violation of, any
applicable domestic (federal, state or local) or foreign law, statute, ordinance,
license, rule, regulation, policy or guideline, order, demand, writ, injunction,
decree or judgment of any Governmental Entity.




(l) Contracts.




(i) Idenix has filed as exhibits to Company Reports filed with the SEC
all material agreements required to be filed under the rules and
regulations of the SEC (the “Material Contracts”).




(ii) All Material Contracts are valid, binding and in full force and
effect and enforceable against Idenix, provided that no
representation is made as to the enforceability of any non-competition
provision in any employment agreement or written arrangement; (B)
Idenix is in all material respects in compliance with and has in all
material respects performed all obligations required to be performed
by it to date under each Material Contract; and (C) as of the date
hereof, Idenix does not know of, and has not received written notice
of, any material violation or default (or any condition which with the



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passage of time or the giving of notice would cause such a violation
of or a default) by any other party under any Material Contract. To
the Knowledge of Idenix, except as disclosed on Company Reports filed
with the SEC prior to the date of this Agreement, there are no
material transactions, or series of related transactions, agreements,
arrangements or understandings, nor are there any currently proposed
material transactions, or series of related transactions, between
Idenix, on the one hand, and any current or former director or
executive officer of Idenix or any person who beneficially owns 5% or
more of the outstanding shares of Common Stock (or any of such
person’s immediate family members or Affiliates), on the other hand.




(m) Status of Purchased Shares. The Purchased Shares being issued at the
Closing will have been duly authorized by all necessary corporate action on the
part of Idenix, and at the Closing such Purchased Shares will have been validly
issued and, assuming payment therefor has been made, will be fully paid and
nonassessable, free and clear of all Liens. The issuance of such Purchased Shares
will not be subject to preemptive rights of any other shareholder of Idenix.




(n) Intellectual Property. Intellectual Property of Idenix is owned free
from any Liens (other than Permitted Liens), except where a failure to be free from
liens would not reasonably be expected to have a Material Adverse Effect on Idenix.
All Intellectual Property Licenses are in full force and effect, except (i) as
enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium and other laws relating to or affecting creditors’
rights generally and by general equitable principles and public policy constraints
(including those pertaining to limitations and/or exclusions of liability,
competition laws, penalties and jurisdictional issues including conflicts of laws)
and (ii) to the extent that any failure to be enforceable, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect on
Idenix. To the Knowledge of Idenix, all Company Intellectual Property is valid and
enforceable and all intellectual property that is the subject of such Intellectual
Property is valid and enforceable. To the Knowledge of Idenix, Idenix has not
received written notice from any third party that the development or future
commercialization of Idenix’s products or product candidates infringes or
misappropriates the rights of any third party in respect of any Intellectual
Property owned by such third party. To the Knowledge of Idenix, none of the
material Company Intellectual Property is being infringed or misappropriated by any
third party.



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(o) Brokers or Finders. No agent, broker, investment banker or other firm
is or will be entitled to any broker’s or finder’s fee or any other commission or
similar fee in connection with any of the transactions contemplated by this
Agreement or the License Agreement as a result of any actions taken by Idenix.




(p) Private Placement. Assuming the accuracy of GSK’s representations and
warranties set forth in Section 6, no registration under the Securities Act is
required for the offer and sale of the Purchased Shares by Idenix to GSK as
contemplated hereby.




(q) Investment Company. Idenix is not, and immediately after receipt of
payment for the Purchased Shares will not be, an “investment company” within the
meaning of the Investment Company Act of 1940, as amended.



     6. Representations and Warranties of GSK. GSK represents and warrants to Idenix as
follows:




(a) Organization. GSK is a corporation duly organized, validly existing
and in good standing under the laws of the Commonwealth of Pennsylvania, has all
requisite power and authority to own, lease and operate its properties and carry on
its business as it is now being conducted and is duly licensed or qualified and is
in good standing as a foreign corporation in each jurisdiction in which the
properties owned, leased or operated, or the business conducted, by it to the
extent such qualification and good standing is required by applicable law, except
for any such failure to be licensed, qualified or in good standing which,
individually or in the aggregate, would not be reasonably expected to have a
Material Adverse Effect on GSK.




(b) Authority. GSK has the requisite corporate power and authority to
execute, deliver and perform this Agreement and to consummate the transactions
contemplated hereby. The execution, delivery and performance of this Agreement by
GSK has been duly authorized, and no other corporate proceedings on the part of GSK
to authorize this Agreement or for GSK to consummate the transactions as
contemplated herein. This Agreement has been duly and validly executed and
delivered by GSK and (assuming the due authorization, execution and delivery by
Idenix) will constitute a legal, valid and binding agreement of GSK, enforceable
against it in accordance with its terms, subject as to enforcement of remedies to
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting generally the enforcement of creditors’ rights and remedies and subject
to a court’s discretionary authority with respect to the granting of a decree
ordering specific performance or other equitable remedies.



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(c) Conflicting Agreements and Other Matters. Neither the execution and
delivery of this Agreement nor the performance by GSK of its obligations hereunder
will conflict with, result in a breach of the terms, conditions or provisions of,
constitute a default under, result in the creation of any Lien upon any of the
properties or assets of GSK pursuant to, or require any consent, approval or other
action by or any notice to or filing with any Government Entity pursuant to, the
organizational documents or agreements of GSK or any agreement, instrument, order,
judgment, decree, statute, law, rule or regulation by which GSK is bound, except
for filings after the Closing under Section 13(d) of the Exchange Act and filings
under the HSR Act.




(d) Acquisition for Investment. GSK (i) is acquiring the Purchased Shares
for its own account for the purpose of investment and not with a view to or for
sale in connection with any distribution thereof, and has no present intention to
effect, or any present or contemplated plan, agreement, undertaking, arrangement,
obligation, indebtedness, or commitment providing for, any distribution of
Purchased Shares; (ii) is an “accredited investor” as defined in Rule 501(a) under
the Securities Act; (iii) has carefully reviewed the representations concerning
Idenix contained in this Agreement and has made detailed inquiry concerning Idenix,
its business and personnel; and (iv) has sufficient knowledge and experience in
finance and business that it is capable of evaluating the risks and merits of its
investment in Idenix and is able financially to bear the risks thereof.




(e) General Solicitation. GSK is not purchasing the Purchased Shares as a
result of any advertisement, article, notice or other communication regarding the
Purchased Shares published in any newspaper, magazine or similar media or broadcast
over television or radio or presented at any seminar or any other general
solicitation or general advertisement.




(f) Confidentiality. GSK acknowledges and agrees that it is a party to the
Prior Confidentiality Agreements (as defined in the License Agreement). GSK is in
compliance, in all material respects, and is bound by the terms of the Prior
Confidentiality Agreements.




(g) Brokers or Finders. No agent, broker, investment banker or other firm
is or will be entitled to any broker’s or finder’s fee or any other commission or
similar fee in connection with any of the transactions contemplated by this
Agreement or the License Agreement as a result of any actions taken by GSK.



     7. Registration Rights.



     7.1 Registration of the Purchased Shares.



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(a) Idenix shall file with the SEC as promptly as practicable after the Closing
Date (and in any event no later than 90 days following the Closing Date), a
Registration Statement covering the resale to the public by GSK of the Purchased
Shares. Idenix shall use commercially reasonable efforts to cause the
Registration Statement covering the Purchased Shares to be declared effective by
the SEC (collectively, the “Registrable Shares”) within 120 days or as
promptly as practicable after the filing thereof. Idenix shall cause such
Registration Statement to remain effective and in compliance with the Securities
Act and usable for resale of such Registrable Shares for a period from the date of
its initial effectiveness until the earlier of (i) all Registrable Shares covered
by such Registration Statement have been sold or may be sold without volume
restrictions pursuant to Rule 144 or (ii) two (2) years from the date the
Registration Statement is declared effective. Idenix shall promptly, and in no
event in more than five (5) Business Days, notify GSK of the effectiveness of such
Registration Statement after Idenix confirms effectiveness with the SEC. In
connection with Idenix’s preparation and filing of the Registration Statement, GSK
shall deliver to Idenix within ten (10) days after the Closing, a completed
questionnaire in the form attached hereto as Exhibit C.




(b) Any registration pursuant to this Section 7.1 shall be effected by means of a
shelf registration under the Securities Act in accordance with the methods and
distribution set forth in the Registration Statement and Rule 415.



     7.2 GSK Compliance. GSK covenants and agrees that it will comply with the prospectus
delivery requirements of the Securities Act as applicable to it in connection with sales of
Registrable Shares pursuant to a Registration Statement. Idenix shall comply in all material
respects with all applicable rules and regulations of the SEC applicable to the filing of a
Registration Statement.



     7.3 Registration Procedures.




(a) In connection with the filing by Idenix of a Registration Statement covering
Registrable Shares, Idenix shall furnish to GSK (i) a copy of the prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Securities Act; and (ii) such other documents as GSK may reasonably request, in
order to facilitate the public sale or other disposition of the Registrable Shares.




(b) In addition, whenever required to effect the registration of any Registrable
Shares or to facilitate the sale of Registrable Shares by GSK pursuant to a
Registration Statement, Idenix shall, as expeditiously as reasonably practicable:
(i) prepare and file with the SEC a prospectus supplement with respect to a
proposed offering of Registrable Shares pursuant to an effective registration
statement and keep such registration



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statement effective or such prospectus supplement current; and (ii) prepare and
file with the SEC such amendments and supplements to the applicable registration
statement and the prospectus or prospectus supplement used in connection with such
registration statement as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
registration statement.




(c) Idenix shall use commercially reasonable efforts to register or qualify the
Registrable Shares covered by a Registration Statement under the securities laws of
each state of the United States as GSK shall reasonably request and keep such
registration or qualification in effect for so long as such registration statement
remains in effect, and to take any other action which may be reasonably necessary
to enable GSK to consummate the disposition in such jurisdictions of the securities
owned by it; provided, however, that Idenix shall not be required
in connection with this paragraph (c) to qualify as a foreign corporation or
execute a general consent to service of process in any jurisdiction.




(d) If Idenix has delivered preliminary or final prospectuses to GSK and after
having done so the prospectus is amended or supplemented to comply with the
requirements of the Securities Act, Idenix shall promptly notify GSK and, if
requested by Idenix, GSK shall immediately cease making offers or sales of
Registrable Shares covered by a Registration Statement and return all prospectuses
to Idenix. Within 30 days, Idenix shall provide GSK with revised or supplemented
prospectuses and, following receipt of the revised or supplemented prospectuses,
GSK shall be free to resume making offers and sales of Registrable Shares under
such Registration Statement.




(e) Idenix shall be entitled to include in a Registration Statement covering
Registrable Shares the shares of Common Stock held by other shareholders of Idenix.




(f) Subject to Section 7.3(i), Idenix shall pay the expenses incurred by it in
complying with its registration obligations under this Section 7, including all
registration and filing fees, exchange listing fees, fees and expenses of counsel
for Idenix, the reasonable fees and expenses of GSK’s counsel (not to exceed
$15,000) and fees and expenses of accountants for Idenix, but excluding any
brokerage fees, selling commissions or underwriting discounts incurred by GSK in
connection with sales under any Registration Statement covering Registrable Shares.




(g) Subject to Idenix’s right to suspend the use of the prospectus or prospectus
supplement as provided in subsection (h) below), Idenix shall use commercially
reasonable efforts to avoid the issuance of any order suspending the effectiveness
of a Registration Statement, or any suspension of the qualifications (or exemption
from qualification) of any



13









 







of the Registrable Shares for sale in any jurisdiction. Idenix shall advise GSK
promptly after it shall receive notice of any stop order or issuance of any order
by the SEC delaying or suspending the effectiveness of a Registration Statement
covering Registrable Shares or of the initiation of any proceeding for that
purpose, and it will promptly use commercially reasonable efforts to prevent the
issuance of any stop order or to obtain its withdrawal at the earliest possible
moment if such stop order should be issued.




(h) If the filing, initial effectiveness or continued use of a Registration
Statement at any time would require Idenix to make an Adverse Disclosure, Idenix
may, upon giving prompt written notice to GSK, suspend the use of a preliminary or
final prospectus and GSK shall immediately cease making offers or sales of
Registrable Shares covered by a Registration Statement for a period (such period
being referred to herein as the “Suspension Period”) not to exceed 30 days
in the aggregate in any three-month period or 90 days in the aggregate in any
12-month period.




(i) Idenix shall enter into an underwriting agreement in customary form, scope and
substance and take all such other actions reasonably requested by GSK to expedite
or facilitate the underwritten disposition of all but no less than all Registrable
Shares then owned by GSK, and in connection therewith in any underwritten offering
(including making members of management and executives of Idenix available to
participate in “road show”, similar sales events and other marketing activities),
(i) make such representations and warranties to GSK and the managing
underwriter(s), if any, with respect to the business of Idenix and its
subsidiaries, and the Registration Statement, prospectus and documents, if any,
incorporated or deemed to be incorporated by reference therein, in each case, in
customary form, substance and scope, and, if true, confirm the same if and when
requested; (ii) use its reasonable best efforts to furnish underwriters opinions of
counsel to Idenix, addressed to the managing underwriter(s), if any, covering the
matters customarily covered in such opinions requested in underwritten offerings;
(iii) use its reasonable best efforts to obtain “cold comfort” letters from the
independent certified public accountants of Idenix (and, if necessary, any other
independent certified public accountants of any business acquired by Idenix for
which financial statements and financial data are included in the Registration
Statement) who have certified the financial statements included in such
Registration Statement, addressed to each of the managing underwriter(s), if any,
such letters to be in customary form and covering matters of the type customarily
covered in “cold comfort” letters; (iv) if an underwriting agreement is entered
into, the same shall contain indemnification provisions and procedures customary in
underwritten offerings; and (v) deliver such documents and certificates as may be
reasonably requested by GSK, their counsel and the managing



14









 







underwriter(s), if any, to evidence the continued validity of the representations
and warranties made pursuant to clause (i) above and to evidence compliance with
any customary conditions contained in the underwriting agreement or other agreement
entered into by Idenix. Notwithstanding anything contained herein to the contrary,
Idenix shall not be required to enter into any underwriting agreement or permit any
underwritten offering absent an agreement by the applicable underwriter(s) to
indemnify Idenix in form, scope and substance as is customary in underwritten
offerings by Idenix in which an Affiliate of Idenix acts as an underwriter.
Notwithstanding anything contained herein to the contrary, GSK shall not exercise
its rights under this Section 7.3(i) prior to the first anniversary of the Closing
Date.




(j) Idenix shall make available for inspection by a representative of GSK, the
managing underwriter(s), if any, and any attorneys or accountants retained by GSK
or such managing underwriter(s), at the offices where normally kept, during
reasonable business hours, financial and other records, pertinent corporate
documents and properties of Idenix, and cause the officers, directors and employees
of Idenix to supply all information in each case reasonably requested by any such
representative, managing underwriter(s), attorney or accountant in connection with
such Registration Statement.



     7.4 Registration Confidentiality. GSK agrees to treat as confidential (unless
otherwise publicly disclosed by Idenix) any written notice from Idenix regarding Idenix’s plans to
file a Registration Statement and shall not disclose such information to any other person, or use
such information, except as is necessary to exercise its rights under this Agreement.



     7.5 Rule 144 Reporting. With a view to making available to GSK the benefits of the
Rules and regulations of the SEC that may permit the sale of the Registrable Shares to the public
without registration, Idenix agrees to use its commercially reasonable efforts to:




(a) make and keep public information available, as those terms are understood and
defined in Rule 144(c)(1) or any similar or analogous rule promulgated under the
Securities Act, at all times after the Effective Date;




(b) file with the SEC, in a timely manner, all reports and other documents required
of Idenix under the Exchange Act; and




(c) so long as GSK owns any Registrable Shares, furnish to GSK forthwith upon
request: (i) a written statement by Idenix as to its compliance with the reporting
requirements of Rule 144 under the Securities Act, and of the Exchange Act; (ii) a
copy of the most recent annual or quarterly report of Idenix; and (iii) such other
reports and documents as GSK may reasonably request in availing itself of any rule
or



15









 







regulation of the SEC allowing it to sell any such securities without registration.



     7.6 Registration Rights Indemnification.




(a) Idenix agrees to indemnify and hold harmless GSK and its officers, directors,
employees, agents, representatives and Affiliates, and each Person, if any, that
controls GSK within the meaning of Section 15 of the Securities Act (each, an
“GSK Indemnitee”) from and against any losses, claims, damages, actions,
liabilities, amounts paid in settlements, costs and expenses (“Losses”), to
which such GSK Indemnitee may become subject (under the Securities Act, the
Exchange Act, state securities or Blue Sky laws or otherwise) insofar as such
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of, or are based upon any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement covering the
Registrable Shares, in any preliminary prospectus or final prospectus contained in
such Registration Statement or any amendments or supplements thereto or any
documents incorporated therein by reference or contained in any free writing
prospectus (as such term is defined in Rule 405) prepared by Idenix or authorized
by it in writing for use by such GSK Indemnitee, or the omission or alleged
omission to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and Idenix will reimburse such GSK
Indemnitee for any reasonable legal or other expenses reasonably incurred in
investigating, defending or preparing to defend any such action, proceeding or
claim, or preparing to defend any such action, proceeding or claim;
provided, however, that Idenix shall not be liable in any such case
to the extent that (i) such loss, claim, damage or liability arises out of, or is
based upon, an untrue statement made in such Registration Statement, preliminary
prospectus or prospectus, any amendment or supplement thereto or contained in any
such free writing prospectus (as such term is defined in Rule 405) in reliance upon
and in conformity with information furnished in writing to Idenix by or on behalf
of such GSK Indemnitee for use in the preparation thereof or any statement or
omission in any prospectus that is corrected in any subsequent prospectus that was
delivered to such GSK Indemnitee, or (ii) such loss, claim, damage or liability
arises solely as a result of the use by a GSK Indemnitee of a preliminary or final
prospectus in contravention of the Suspension Period pursuant to Section 7.3(h)
above, provided that Idenix shall have provided proper notice of such Suspension
Period prior to such use.




(b) GSK agrees to indemnify and hold harmless Idenix and its officers, directors,
employees, agents, representatives and Affiliates, and each Person, if any, who
controls Idenix within the meaning of Section 15 of the Securities Act (each, an
“Idenix Indemnitee”), from and against any



16









 







Losses to which any such Idenix Indemnitee may become subject (under the Securities
Act, the Exchange Act, state securities or Blue Sky laws or otherwise), insofar as
such losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of, or are based upon any untrue statement of a material fact
contained in any Registration Statement covering the Registrable Shares or in any
preliminary prospectus, final prospectus contained in such Registration Statement,
or any amendments or supplements thereto or any documents incorporated therein by
reference or contained in any free writing prospectus (as that term is defined in
Rule 405) prepared by Idenix or authorized by it in writing for use by an Idenix
Indemnitee or the omission or alleged omission to state a material fact required
to be stated therein or necessary to make the statements therein not misleading, if
such untrue statement or omission was made in reliance upon and in conformity with
information furnished in writing by or on behalf of GSK for use in preparation of
the Registration Statement, prospectus, amendment or supplement and GSK will
reimburse Idenix, or such officer, director or controlling person, as the case may
be, for any reasonable legal or other expenses reasonably incurred in
investigating, defending or preparing to defend any such action, proceeding or
claim.




(c) If the indemnification provided for in this Section 7.6 or Section 8(f)(i) or
(ii) is unavailable to or insufficient to hold harmless an indemnified party under
paragraph (a) or (b) above in respect of any losses, claims, damages or liabilities
(or actions or proceedings in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative fault of Idenix on the one hand and GSK on the other hand, in connection
with the statements or omissions or other matters which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative fault shall be determined by
reference to, among ether things, in the case of an untrue statement, whether the
untrue statement relates to information supplied by Idenix on the one hand or GSK
on the other hand and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such untrue statement. Idenix and
GSK agree that it would not be just and equitable if contribution pursuant to this
paragraph (c) were determined by pro rata allocation or by any other method of
allocation which does not take into account the equitable considerations referred
to above in this paragraph (c). The amount paid or payable by an indemnified party
as a result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this paragraph (c) shall be deemed to include any
reasonable legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any



17









 







such action or claim. 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 who was not guilty of such fraudulent misrepresentation.




(d) The rights and obligations of Idenix and GSK under this Section 7.6 shall
survive the termination of this Agreement.



     7.7 Termination. All of Idenix’s obligations to register the Registrable Shares under
this Agreement shall terminate on a merger or consolidation of Idenix in which GSK receives cash or
securities that have been registered with the SEC in exchange for the Purchased Shares.



     8. Covenants and Additional Agreements.




(a) Obligations. Idenix and GSK shall use commercially reasonable efforts
to take or cause to be taken all actions, and to do or cause to be done all other
things, necessary, proper or advisable in order to fulfill and perform its
obligations in respect of this Agreement, or otherwise to consummate and make
effective the transactions contemplated hereby and thereby.




(b) Consents and Approvals. Idenix and GSK shall, as promptly as
practicable, (i) make, or cause to be made, all filings and submissions (including
but not limited to under the HSR Act and foreign antitrust filings and any filings
under the rules and regulations of the SEC) required under any law applicable to
it, and give such reasonable undertakings as may be required in connection
therewith; and (ii) use commercially reasonable efforts to obtain or make, or cause
to be obtained or made, all Permits and consents necessary to be obtained or made
by it, in each case in connection with this Agreement, the sale and transfer of the
Purchased Shares pursuant hereto and the consummation of the other transactions
contemplated hereby or thereby. Idenix shall, as promptly as practicable, use
commercially reasonable efforts to cause the Common Stock to be listed on Nasdaq or
such other market on which the Common Stock is then listed or quoted, subject to
official notice of issuance.




(c) Further Actions. Idenix and GSK shall coordinate and cooperate with
the other Party in exchanging such information and supplying such reasonable
assistance as may be reasonably requested by such other party in connection with
the filings and other actions contemplated by this Agreement. GSK and Idenix will
have the right to review in advance, and to the extent practicable each will
consult with the other, in each case subject to applicable laws relating to the
exchange of information, all the information relating to such other Party, and any
of their respective Affiliates, which appears in any filing made with, or written
materials submitted to, any third party or any Governmental Entity in connection



18









 







with the transactions to which it will be party contemplated by this Agreement. In
exercising the foregoing right, each of the Parties hereto agrees to act reasonably
and as promptly as practicable. Idenix and GSK shall execute, acknowledge and
deliver such further instruments, and do all such other acts, as may be necessary
or appropriate in order to carry out the purposes and intent of this Agreement.




(d) Certain Transactions. Idenix will not merge or consolidate into, or
sell, transfer or lease all or substantially all of its property or assets to, any
other party unless the successor, transferee or lessee party, as the case may be
(if not Idenix), expressly assumes the due and punctual performance and observance
of each and every covenant and condition of this Agreement to be performed and
observed by Idenix.




(e) Dividends; Capital Structure. From the Execution Date until the
Closing, Idenix shall (i) not declare or pay any dividend or distribution on the
Common Stock; (ii) split, combine, redeem or reclassify, or purchase or otherwise
acquire, any shares of capital stock (or other equity interests) or other
securities of Idenix; or (iii) adopt or implement a “poison pill,” stockholder
rights plan or any similar device.




(f) Indemnity.




(i) Idenix agrees to indemnify and hold harmless each GSK Indemnitee
to the fullest extent lawful, from and against any and all Losses
arising out of or resulting from (A) any inaccuracy in or breach of
Idenix’s representations or warranties in this Agreement, (B) any
breach of the agreements or covenants made by Idenix in this Agreement
or (C) any action, suit, claim, proceeding or investigation by any
Governmental Entity, shareholder of Idenix or any other person (other
than Idenix) relating to the execution and delivery of this Agreement
or the issuance of the Purchased Shares contemplated hereby (other
than any Losses attributable to the acts, errors or omissions on the
part of GSK, but not including the transactions contemplated hereby).




(ii) GSK agrees to indemnify and hold harmless each Idenix Indemnitee
to the fullest extent lawful, from and against any and all Losses
arising out of or resulting from (A) any inaccuracy in or breach of
GSK’s representations or warranties in this Agreement or (B) any
breach of agreements or covenants made by GSK in this Agreement.




(iii) Promptly after receipt by any indemnified person of a notice of
a claim or the beginning of any action in respect of which indemnity
is to be sought against an indemnifying



19









 







person pursuant to Section 7.6 or Sections 8(f)(i) and (ii), such
indemnified person shall notify the indemnifying person in writing of
such claim or of the commencement of such action, but the omission to
so notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party under the
applicable Section (except to the extent that such omission materially
and adversely affects the indemnifying party’s ability to defend such
action). Subject to the provisions hereinafter stated, in case any
such action shall be brought against an indemnified person, the
indemnifying person shall be entitled to participate therein, and, to
the extent that it shall elect by written notice delivered to the
indemnified party within 45 days after receiving the aforesaid notice
from such indemnified party, shall be entitled to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified
person. After notice from the indemnifying person to such indemnified
person of its election to assume the defense thereof, such
indemnifying person shall not be liable to such indemnified person for
any legal expenses subsequently incurred by such indemnified person in
connection with the defense thereof; provided,
however, that if there exists or shall exist a conflict of
interest that would make it inappropriate, in the opinion of counsel
to the indemnified person, for the same counsel to represent both the
indemnified person and such indemnifying person, the indemnified
person shall be entitled to retain its own counsel at the expense of
such indemnifying person; provided, however, that no
indemnifying person shall be responsible for the fees and expenses of
more than one separate counsel (together with appropriate local
counsel) for all indemnified parties. In no event shall any
indemnifying person be liable in respect of any amounts paid in
settlement of any action unless the indemnifying person shall have
approved the terms of such settlement; provided,
however, that such consent shall not be unreasonably withheld.
The indemnifying party shall not be liable for any settlement of any
action, suit, claim or proceeding effected without its written
consent; provided, however, that the indemnifying
party shall not unreasonably withhold or delay its consent. The
indemnifying party further agrees that it will not, without the
indemnified party’s prior written consent (which shall not be
unreasonably withheld or delayed), settle or compromise any claim or
consent to entry of any judgment in respect thereof in any pending or
threatened action, suit, claim or proceeding in respect of which
indemnification has been sought hereunder unless such settlement or
compromise includes an



20









 







unconditional release of such indemnified party from all liability
arising out of such action, suit, claim or proceeding.




(iv) No investigation by GSK of Idenix or by Idenix of GSK prior to or
after the date hereof shall limit any indemnified party’s exercise of
any right hereunder or be deemed to be a waiver of any such right.



     9. Interpretation; Definitions.




(a) For purposes of this Agreement, the following terms shall have the following
meanings:




“Adverse Disclosure” means public disclosure of material non-public information
that, in Idenix’s Board of Director’s good faith judgment, after consultation with counsel
to Idenix, (a) would be required to be made in any Registration Statement or report filed
with the SEC by Idenix so that such Registration Statement or report would not be
materially misleading; (b) would not be required to be made at such time but for the filing
of such Registration Statement; and (c) Idenix has a bona fide business
purpose for not disclosing publicly.




“Affiliate” means, with respect to any Person, any other Person that directly or
indirectly through one or more intermediaries, Controls, is Controlled by, or is under
common Control with, such Person.




“Agreement” means this Agreement, as the same may be amended or supplemented from
time to time, by written agreement of Idenix and GSK, together with all appendices,
exhibits and schedules attached hereto and the Disclosure Schedule.




“Business Day” means any day on which banking institutions are open in the City of
Boston.




“Closing” is defined in Section 2.




“Closing Date” is defined in Section 2.




“Common Stock” is defined in the recitals to this Agreement.




“Company Intellectual Property” means the Intellectual Property and Intellectual
Property Licenses that are owned by Idenix.




“Company Reports” is defined in Section 5(e).




“Contract” is defined in Section 5(c)(i).




“Control” means the possession, direct or indirect, of the power to direct or cause
the direction of the management and policies of a Person, whether through the



21









 







ownership of voting securities, by contract or otherwise, and “Controlled” has a
correlative meaning.




“Disclosure Schedule” is defined in Section 5.




“Effective Date” is defined in Section 2.




“Exchange Act” means the Securities Exchange Act of 1934, as amended, or any
successor federal statute and the rules and regulations of the SEC promulgated thereunder,
all as the same shall be in effect from time to time.




“Execution Date” is defined in the preamble to this Agreement.




“FDA” is defined in Section 5(e).




“GAAP” means United States generally accepted accounting principles.




“Governmental Entity” is defined in Section 5(c)(ii).




“GSK” is defined in the preamble to this Agreement.




“GSK Indemnitee” is defined in Section 7.6(a).




“HSR Act” is defined in Section 5(c)(ii).




“HSR Clearance Date” is defined in Section 1.




“Idenix” is defined in the preamble to this Agreement.




“Idenix Indemnitee” is defined in Section 7.6(b).




“Indebtedness” shall mean (a) any liabilities for borrowed money or amounts owed in
excess of $250,000 (other than trade accounts payable incurred in the ordinary course of
business) and (b) all guaranties, endorsements and other contingent obligations in respect
of indebtedness of others, whether or not the same are or should be reflected in Idenix’s
balance sheet (or the notes thereto), except guaranties by endorsement of negotiable
instruments for deposit or collection or similar transactions in the ordinary course of
business.




“Intellectual Property” means trademarks, trade names, trade dress, service marks,
copyrights, domain names, and similar rights (including registrations and applications to
register or renew the registration of any of the foregoing), patents and patent
applications, trade secrets, and any other similar intellectual property rights.




“Intellectual Property License” means any written license, permit, authorization,
approval, Contract or consent granted, issued by or with any Person relating to the use by
Idenix of Intellectual Property.



22









 






“Knowledge of Idenix,” or any like expression means the actual knowledge of each of
the Chief Executive Officer, the Chief Financial Officer and the Executive Vice President,
General Counsel of Idenix and the knowledge that would be reasonably expected to be known
by such individuals in the ordinary and usual course of the performance of their
professional responsibilities to Idenix.




“Lien” is defined in Section 5(c)(i).




“License Agreement” is defined in the recitals to this Agreement.




“Losses” is defined in Section 7.6(a).




“Material Adverse Effect” on or with respect to an entity means any state of
facts, event, change or effect that has had, or would reasonably be expected to have, a
material adverse effect on (a) the results of business, properties, results of operations
or financial condition of such entity, (b) the ability of such entity to consummate the
transactions and perform in any material respect on a timely basis its obligations
contemplated under the Transaction Documents, or (c) the legality, validity or
enforceability of any Transaction Document.




“Material Contract” is defined in Section 5(l)(i).




“Nasdaq” means the NASDAQ Global Market.




“Novartis Consent” is defined in Section 3.




“Novartis Waiver” is defined in Section 3.




“Parties” is defined in the preamble to this Agreement.




“Permit” all permits, licenses, registrations, certificates, orders or approvals
from any Governmental Entity.




“Permitted Liens” means (a) those Liens (A) for Taxes not yet due or payable or
being contested in good faith and for which adequate reserves have been established in
accordance with GAAP, (B) that constitute mechanics’, carriers’, workmen’s or like liens,
liens arising under original purchase price conditional sales contracts and equipment
leases with third parties entered into in the ordinary course, (C) Liens incurred or
deposits made in the ordinary course of business consistent with past practice in
connection with workers’ compensation, unemployment insurance and social security,
retirement and other legislation, (D) easements, covenants, declarations, rights or way,
encumbrances, or similar restrictions in connection with real property owned by Idenix that
do not materially impair the use of such real property by Idenix; and (b) with respect to
Company Intellectual Property, (A) the joint ownership of any Company Intellectual Property
by Idenix, on the one hand, and any other Person(s) (each such Person, a
“Co-Owner”), on the other hand, set forth in Section 5(n) of the



23









 







Disclosure Schedule; (B) licenses under the Company Intellectual Property granted by
Idenix, any Co-Owner or any licensee of the foregoing set forth in Section 5(n) of the
Disclosure Schedule; or (C) rights to use Company Intellectual Property granted by Idenix
under reasonable and customary service agreements, clinical trial agreements, consulting
agreements, material transfer agreements and confidentiality agreements entered into in the
ordinary course of business.




“Person” means any individual, partnership, joint venture, corporation, limited
liability company, trust, unincorporated organization, government or department or agency
of a government or other entity.




“Preference Holders” is defined in Section 3.




“Preference Holders Consent” is defined in Section 3.




“Prior Confidentiality Agreements” is defined in Section 6(f).




“Purchase Price” is defined in Section 1.




“Purchased Shares” is defined in Section 1.




“Registrable Shares” is defined in Section 7.1.




“Registration Statement” means the registration statement(s) on Form S-3 (or any
successor form related to secondary offerings) required to be filed hereunder and any
additional registration statements contemplated by Section 7.1, including (in each case)
the prospectus, amendments and supplements to such registration statement or prospectus,
including pre- and post-effective amendments, all exhibits thereto, and all material
incorporated by reference or deemed to be incorporated by reference in such registration
statement.




“SEC” means the Securities and Exchange Commission.




“Securities Act” means the Securities Act of 1933, as amended, or any successor
federal statute, and the rules and regulations of the SEC promulgated thereunder, all as
the same shall be in effect from time to time.




“Suspension Period” is defined in Section 7.3(h).




“Taxes” means all taxes, charges, levies, penalties or other assessments imposed by
any United States federal, state, local or foreign taxing authority, including any income,
excise, property, sales, transfer, franchise, payroll, withholding, social security or
other taxes, together with any interest or penalties attributable thereto, and any payments
made or owing to any other person measured by such taxes, charges, levies, penalties or
other assessment, whether pursuant to a tax indemnity agreement, tax sharing payment or
otherwise.



24









 






“Tax Return” means any return, report, information return or other document
(including any related or supporting information) required to be filed with any taxing
authority with respect to Taxes, including without limitation all information returns
relating to Taxes of third parties, any claims for refunds of Taxes and any amendments or
supplements to any of the foregoing.




“Transaction Documents” means this Agreement, the License Agreement and any other
documents or agreements executed in connection with the transactions contemplated hereunder
or thereunder.




(b) The definitions of the terms herein apply equally to the singular and plural
forms of the terms defined. Whenever the context may require, any pronoun will
include the corresponding masculine, feminine and neuter forms. The words
“include”, “includes” and “including” will be deemed to be followed by the phrase
“without limitation.” Unless the context requires otherwise, (A) any definition of
or reference to any agreement, instrument or other document herein will be
construed as referring to such agreement, instrument or other document as from time
to time amended, supplemented or otherwise modified (subject to any restrictions on
such amendments, supplements or modifications set forth herein or therein), (B) any
reference to any laws or regulations herein will be construed as referring to such
laws and regulations as from time to time enacted, repealed or amended, (C) any
reference herein to any Person will be construed to include the Person’s successors
and assigns, (D) the words “herein”, “hereof” and “hereunder”, and words of similar
import, will be construed to refer to this Agreement in its entirety and not to any
particular provision hereof, (E) any reference herein to the words “mutually agree”
or “mutual written agreement” will not impose any obligation on either party to
agree to any terms relating thereto or to engage in discussions relating to such
terms except as such party may determine in such party’s sole discretion, and (F)
all references herein to Sections, Exhibits or Schedules will be construed to refer
to Sections, Exhibits and Schedules of this Agreement.



     10. Termination.




(a) This Agreement may be terminated prior to the Closing:




(i) by mutual written agreement of Idenix and GSK;




(ii) Idenix or GSK, upon written notice to the other parties, if the
Effective Date has not occurred on or prior to the date that is ninety
(90) days after the Parties make their respective HSR Filings pursuant
to Section 13.1 of the License Agreement; provided,
however, that the right to terminate this Agreement pursuant
to this Section 10(a)(ii) shall not be available to any party whose
failure to fulfill any obligation



25









 







under this Agreement or the License Agreement shall have been the
cause of, or shall have resulted in, the failure of the Closing to
occur on or prior to such date; or




(iii) by Idenix or GSK, upon written notice to the other party, in the
event that any Governmental Entity shall have issued any order, decree
or injunction or taken any other action restraining, enjoining or
prohibiting any of the transactions contemplated by this Agreement,
and such order, decree, injunction or other action shall have become
final and nonappealable.




(b) In the event of any termination of this Agreement as provided in Section 10(a),
this Agreement (other than Sections 8(f)(i)(C), 8(f)(iii) and 11 (excluding
Sections 11.2 and 11.9), which shall remain in full force and effect) shall
forthwith become wholly void and of no further force and effect; provided that
nothing herein shall relieve any party from liability for any knowing breach of
this Agreement.



     11. Miscellaneous.



     11.1 Severability. If any term, provision, covenant or restriction of this Agreement
is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of
the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the remaining terms,
provisions, covenants, and restrictions without including any of such which may be hereafter
declared invalid, void or unenforceable.



     11.2 Specific Enforcement. GSK, on the one hand, and Idenix, on the other,
acknowledge and agree that irreparable damage would occur in the event that any of the provisions
of this Agreement were not performed in accordance with their specific terms or were otherwise
breached. It is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of the provisions hereof in any court of the United States or any
state thereof having jurisdiction, this being in addition to any other remedy to which they may be
entitled at law or equity.



     11.3 Entire Agreement. This Agreement and the License Agreement constitute the entire
agreement, and supersede all other prior agreements, understandings, representations and
warranties, both written and oral, among the parties, with respect to the subject matter hereof.



     11.4 Counterparts. This Agreement may be executed in one or more counterparts, each
of which, when so executed and delivered, shall be considered to be an original, and all of which
counterparts, taken together, will constitute one and the same



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instrument even if the parties have not executed the same counterpart. Signatures provided by
facsimile or electronic transmission will be deemed to be original signatures.



     11.5 Notices. All notices and other communications required or permitted under this
Agreement shall be in writing and addressed to Idenix or GSK, as the case may be, at their
respective addresses set forth below:


Notices to GSK shall be addressed to:



GlaxoSmithKline

709 Swedeland Road

P.O. Box 1539

King of Prussia, PA 19406-0939

Attention: Senior Vice President of Worldwide Business Development

Telephone: (610) 270- 5397

Facsimile: (610) 270-5166




With copies to:


GlaxoSmithKline

2301 Renaissance Blvd.

King of Prussia, PA 1946-2772

Attention: Vice President, R&D Legal Operations Business Development
Transactions

Telephone: (610) 787-4093

Facsimile: (610) 787-7084



and to



Cleary Gottlieb Steen & Hamilton LLP

One Liberty Plaza

New York, New York 10006

Attention: Benet J. O’Reilly

Phone: (212) 225-2000

Facsimile: (212) 225-3999



Notices to Idenix shall be addressed to:



Idenix Pharmaceuticals Inc.

60 Hampshire Street

Cambridge, MA 02139, USA

Attention: Chief Executive Officer

Telephone: 617-995-9888

Facsimile: 617-995-9889




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With a copy to:



Idenix Pharmaceuticals Inc.

60 Hampshire Street

Cambridge, MA 02139, USA

Attention: General Counsel

Telephone: 617-995-9005

Facsimile: 617-995-9889



and to



Wilmer Cutler Pickering Hale and Dorr LLP

60 State Street

Boston, Massachusetts 01209

Attn: Susan Murley, Esq.

Telephone (617) 526-6000

Facsimile: (617) 526-5000



All notices and other communications required or permitted under this Agreement shall be effective
upon the earlier of actual receipt thereof by the person to whom notice is directed or (a) in the
case of notices and communications sent by personal delivery or telecopy, one Business Day after
such notice or communication arrives at the applicable address or was successfully sent to the
applicable telecopy number, (b) in the case of notices and communications sent by overnight
delivery service, at noon (local time) on the second Business Day following the day such notice or
communications was delivered to such delivery service, and (c) in the case of notices and
communications sent by United States mail, three days after such notice or communication shall have
been deposited in the United States mail. Any notice delivered to a party hereunder shall be sent
simultaneously, by the same means, to such party’s counsel as set forth above.




     11.6 Amendments. This Agreement may not be waived, changed, modified, or discharged
orally, but only by an agreement in writing signed by the party or parties against whom enforcement
of any waiver, change, modification or discharge is sought or by parties with the right to consent
to such waiver, change, modification or discharge on behalf of such party.



     11.7 Successors and Assigns. All covenants and agreements contained herein shall bind
and inure to the benefit of the parties hereto and their respective successors and assigns. This
Agreement, and the rights and obligations of GSK hereunder, may be assigned by GSK to any person or
entity to which Purchased Shares are transferred by GSK; provided that such assignment of
rights shall be contingent upon the transferee providing a written instrument to Idenix notifying
Idenix of such transfer and assignment and agreeing in writing to be bound by the terms of this
Agreement.



     11.8 Expenses and Remedies. All costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby shall be borne by the party incurring such
expense.



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     11.9 Transfer of Purchased Shares. GSK understands and agrees that the Purchased
Shares have not been registered under the Securities Act or the securities laws of any state and
that they may only be sold or otherwise disposed of in compliance with state and federal securities
laws. GSK understands and agrees that each certificate representing the Purchased Shares (other
than Securities which have been transferred in a transaction registered under the Securities Act or
exempt from the registration requirements of the Securities Act pursuant to Rule 144 thereunder or
any similar rule or regulation) shall bear the following legend:




“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD OR OTHERWISE
DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND
APPLICABLE STATE SECURITIES LAWS OR AN APPLICABLE EXEMPTION TO THE REGISTRATION
REQUIREMENTS OF SUCH ACT OR SUCH LAWS.”


and GSK agrees to transfer the Purchased Shares only in accordance with the provisions of such
legend. Idenix shall cause the foregoing legend to be removed from any Purchased Shares or from the
certificates representing such Purchased Shares, at the request of the holder thereof, at such time
as they become eligible for resale pursuant to an effective Registration Statement or without
volume restrictions pursuant to Rule 144 or upon receipt by Idenix of an opinion of counsel
reasonably satisfactory to the Company to the effect that such legend is no longer required under
the Securities Act and applicable state laws. Subject to compliance with any applicable securities
laws and the conditions set forth in this Section 11.9, if GSK wishes to transfer Purchased Shares,
at GSK’s request, and subject to the delivery by GSK of such documentation as may be reasonably
requested by Idenix or its counsel, Idenix shall cause its counsel to issue a legal opinion to
Idenix’s transfer agent, if required by Idenix’s transfer agent, to effect a transfer of any of the
Purchased Shares.




     11.10 Governing Law. This Agreement shall be governed by and construed and enforced
in accordance with the laws of the State of Delaware without regard to choice of law and conflicts
of law principles.



     11.11 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY
AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT
OR THE TRANSACTIONS CONTEMPLATED HEREBY.



     11.12 Publicity. Idenix and GSK shall abide by Section 7.4 of the License Agreement
relating to publicity.



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     11.13 No Third Party Beneficiaries. Nothing contained in this Agreement is intended
to confer upon any Person other than the parties hereto and their respective successors and
permitted assigns, any benefit, right or remedies under or by reason of this Agreement.



[Signature Pages Follow]




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IN WITNESS WHEREOF, the Parties executed this Agreement as of the date first above written.




	 	 	 	 	 
	 	IDENIX PHARMACEUTICALS, INC.

 	 
	 	By:  	/s/
Jean - Pierre Sommadossi                            	 
	 	 	Name:  	Jean - Pierre Sommadossi, Ph.D.	 
	 	 	Title:  	Chairman and CEO	 
	 
	 	SMITHKLINE BEECHAM CORPORATION 

D/B/A GLAXOSMITHKLINE

 	 
	 	By:  	/s/
William J. Mosher 	 
	 	 	Name:  	
William J. Mosher 	 
	 	 	Title:  	Vice President and Secretary	 
	 




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