Document:

Exhibit 4.1
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DESCRIPTION OF SECURITIES REGISTERED UNDER SECTION 12 OF THE EXCHANGE ACT
The following description of registered securities of InVivo Therapeutics Holdings Corp. (“us,” “our,” “we” or the “Company”) is intended as a summary only and therefore is not a complete description. This description is based upon, and is qualified by reference to, our articles of incorporation, as amended, our amended and restated bylaws and applicable provisions of the Nevada Revised Statutes (the “NRS”). You should read our articles of incorporation, as amended, and amended and restated bylaws, which are incorporated by reference as Exhibits 3.1, 3.3, 3.4, 3.5 and 3.6 and Exhibit 3.2, respectively, to the Annual Report on Form 10-K of which this Exhibit 4.1 is a part, for the provisions that are important to you.
Authorized Capital Stock
Our authorized capital stock consists of 50,000,000 shares of common stock, par value $0.00001 per share. Our common stock is registered under Section 12(b) of the Exchange Act.
Common Stock
Voting Rights. The holders of common stock are entitled to one vote per share on all matters submitted to a vote of the stockholders, including the election of directors. Generally, all matters to be voted on by stockholders must be approved by a majority (or, in the case of election of directors, by a plurality) of the votes entitled to be cast by all shares of common stock that are present in person or represented by proxy. Except as otherwise provided by law, amendments to our articles of incorporation generally must be approved by a majority of the votes entitled to be cast by all outstanding shares of common stock. Our articles of incorporation do not provide for cumulative voting in the election of directors.
Dividends. Except as provided by law or in our articles of incorporation, the holders of common stock will be entitled to such cash dividends as may be declared from time to time by our board of directors from funds available.
Liquidation, Dissolution and Winding Up. Upon liquidation, dissolution or winding up of the Company, the holders of common stock will be entitled to receive pro rata all assets available for distribution to such holders after payment of our liabilities.
Other Rights. The holders of common stock have no preferential or preemptive right and no subscription, redemption or conversion privileges with respect to the issuance of additional shares of our common stock. 
Provisions of Our Articles of Incorporation and Bylaws and the NRS That May Have Anti-Takeover Effects
Anti-Takeover Effects of Provisions of Nevada State Law
We may be or in the future we may become subject to Nevada's control share laws. A corporation is subject to Nevada's control share law if it has more than 200 stockholders, at least 100 of whom are stockholders of record and residents of Nevada, and if the corporation does business in Nevada, including through an affiliated corporation. This control share law may have the effect of discouraging corporate takeovers. We currently have less than 100 stockholders of record who are residents of Nevada.
The control share law focuses on the acquisition of a "controlling interest," which means the ownership of outstanding voting shares that would be sufficient, but for the operation of the control share law, to enable the acquiring person to exercise the following proportions of the voting power of the corporation in the election of directors: (1) one-fifth or more but less than one-third; (2) one-third or more but less than a majority; or (3) a majority or more. The ability to exercise this voting power may be direct or indirect, as well as individual or in association with others.
The effect of the control share law is that an acquiring person, and those acting in association with that person, will obtain only such voting rights in the control shares as are conferred by a resolution of the stockholders of the corporation, approved at a special or annual meeting of stockholders. The control share law contemplates that voting rights will be considered only once by the other stockholders. Thus, there is no authority to take away voting rights from the control shares of an acquiring person once those rights have been approved. If the stockholders do not grant voting rights to the control shares acquired by an acquiring person, those shares do not become permanent non-voting shares. The acquiring person is free to sell the shares to others. If the buyer or buyers of those shares themselves do not acquire a controlling interest, the shares are not governed by the control share law.
If control shares are accorded full voting rights and the acquiring person has acquired control shares with a majority or more of the voting power, a stockholder of record, other than the acquiring person, who did not vote in favor of approval of voting rights, is entitled to demand fair value for such stockholder's shares.
In addition to the control share law, Nevada has a business combination law, which prohibits certain business combinations between Nevada corporations and "interested stockholders" for two years after the interested stockholder first becomes an interested stockholder, unless the corporation's board of directors approves the combination in advance. For purposes of Nevada 

law, an interested stockholder is any person who is: (a) the beneficial owner, directly or indirectly, of 10% or more of the voting power of the outstanding voting shares of the corporation, or (b) an affiliate or associate of the corporation and at any time within the previous two years was the beneficial owner, directly or indirectly, of 10% or more of the voting power of the then-outstanding shares of the corporation. The definition of "business combination" contained in the statute is sufficiently broad to cover virtually any kind of transaction that would allow a potential acquirer to use the corporation's assets to finance the acquisition or otherwise to benefit its own interests rather than the interests of the corporation and its other stockholders.
The effect of Nevada's business combination law is to potentially discourage parties interested in taking control of the Company from doing so if it cannot obtain the approval of our board of directors.
Anti-Takeover Effects of Provisions of Our Articles of Incorporation and Bylaws
Our articles of incorporation provide for a classified board of directors. This provision could prevent a party who acquires control of a majority of our outstanding common stock from obtaining control of the board until our second annual stockholders meeting following the date the acquirer obtains the controlling stock interest. The classified board provision could have the effect of discouraging a potential acquirer from making a tender offer or otherwise attempting to obtain control of us and could increase the likelihood that incumbent directors will retain their positions. In addition, under our amended and restated bylaws, directors may be removed only for cause and only by the affirmative vote of the holders of at least 80% of the voting power of our then outstanding shares of capital stock entitled to vote generally in the election of directors, voting together as a single class.
Our amended and restated bylaws also provide that stockholders may only act at meetings of stockholders and not by written consent in lieu of a stockholders' meeting. Our amended and restated bylaws provide that stockholders may not call a special meeting of stockholders. Rather, only the Chairman of our board of directors, the President, or the board of directors pursuant to a resolution approved by a majority of the entire board of directors are able to call special meetings of stockholders. These provisions may discourage another person or entity from making a tender offer, even if it acquired a majority of our outstanding voting stock, because the person or entity could only take action at a duly called stockholders' meeting relating to the business specified in the notice of meeting and not by written consent.
Our amended and restated bylaws also provide that stockholders may only conduct business at special meetings of stockholders that was specified in the notice of the meeting, and a stockholder must notify us in writing, within timeframes specified in our bylaws, of any stockholder nomination of a director and of any other business that the stockholders intends to bring at a meeting of stockholders. Our amended and restated bylaws also provide that our bylaws may be amended by our board of directors or by the affirmative vote of at least 80% of our voting stock then outstanding. These provisions could have the effect of discouraging a potential acquirer from making a tender offer or otherwise attempting to obtain control of us because the foregoing provisions may limit the proposals that may be acted upon at a stockholders’ meeting, and the amendment provisions in our bylaws make such provisions difficult to change.pbyi-ex101d_196.htm

Exhibit 10.1(d)

 

 

 

 

 

[***] Certain information in this document has been excluded pursuant to Regulation S-K, Item 601(b)(10). Such excluded information is not material and would likely cause competitive harm to the registrant if publicly disclosed.

October 29, 2020

Puma Biotechnology, Inc. 

10880 Wilshire Blvd., Suite 2150

Los Angeles, CA 90024

Attention: Alan Auerbach

Re:Amendment No. 2 to the License Agreement Between Pfizer Inc. and Puma Biotechnology, Inc. 

Dear Mr. Auerbach: 

This letter (“Amendment No. 2”) will serve as a second amendment to the License Agreement between Pfizer Inc. (“Pfizer”) and Puma Biotechnology, Inc. (“Puma”) dated August 18, 2011, as amended (the “Agreement”). Any capitalized terms below shall have the meaning set forth in the Agreement, unless otherwise defined herein. This Amendment No. 2 will be effective as of October 29, 2020.

Pfizer and Puma have previously discussed the scope of Puma’s right to enforce certain patent rights against a Third Party pursuant to Section 8.2 of the Agreement. The Parties desire to amend the terms of the Agreement and the Parties agree as follows:

1. Subject to the terms and conditions of Section 8 of the Agreement and this Amendment No. 2, Pfizer hereby additionally grants Puma the sole right, but does not impose the obligation, to control any and all [***] Enforcements and any settlement thereof; provided that any settlement by Puma will be pursuant to the terms of this Amendment No.2 and the Agreement. All patents claiming priority to [***] are collectively referred to herein as the “[***] Patents”. Enforcement of any of the [***] Patents against any actual or threatened infringement, 

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Exhibit 10.1(d)

 

 

 

 

misappropriation or other violation by a Third Party product, other than Products, or challenge to the validity, scope or enforceability by a Third Party, [***] with any such Third Party, in each case, in the Territory, are referred to herein as a “[***] Enforcement”. 

2. During the course of any [***] Enforcement, Puma and Pfizer will periodically, but no less frequently than once every [***], consult with respect to such [***] Enforcement, including consulting with respect to the status, litigation strategy and settlement of such [***] Enforcement. Puma will reasonably consider Pfizer’s input and comments with respect to such [***] Enforcement including settlement proposals or offers in connection therewith. Subject to Applicable Law and any limitations imposed by court order, when negotiating a license or settlement in connection with a [***] Enforcement with a Third Party that is the subject of such [***] Enforcement, Puma will use [***] to keep Pfizer informed with respect to the content and progress of any such license or settlement negotiations between Puma and such Third Party. Puma will reasonably consider Pfizer’s input and comments with respect to the negotiation of any such license or settlement agreement. 

3. Prior to executing any license or settlement agreement relating to a [***] Enforcement (each a “Proposed Settlement”), Puma will give Pfizer timely notice (each a “Settlement Notice”) of the terms of such Proposed Settlement and notice of, and details regarding, any additional agreements, arrangements, obligations, rights, promises or conditions associated with such Proposed Settlement [***]. Puma will not enter into any such Proposed Settlement without the prior written approval of Pfizer, such approval not to be unreasonably withheld, conditioned or delayed [***]. Pfizer will be deemed to have approved a Proposed Settlement if Pfizer does not reject in writing the terms of such Proposed Settlement that is the subject of a Settlement Notice within [***] after receipt of such Settlement Notice. If an earlier deadline is imposed in connection with a Proposed Settlement by a court or other similar venue or arises due to a pending action to be taken before a court or other similar venue [***] Pfizer will use commercially reasonable efforts to approve or deny such Proposed Settlement prior to such deadline. If Pfizer rejects any Proposed Settlement, Pfizer will promptly provide Puma with an explanation of the reason for its rejection. 

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Exhibit 10.1(d)

 

 

 

 

4. If Pfizer approves or is deemed to have approved a Proposed Settlement in connection with a [***] Enforcement, Puma will enter into a license or settlement agreement, as applicable, relating to such [***] Enforcement that has Material Terms that are substantially the same as the Material Terms presented to Pfizer in the Settlement Notice associated with such [***] Enforcement (each such settlement a “Final Settlement”). “Material Terms” with respect to a license or settlement agreement means (a) [***], (b) [***], and (c) [***]. Puma will warrant to Pfizer, [***] in any Final Settlement associated with a [***] Enforcement that such Final Settlement memorializes all of the agreements, arrangements, obligations, rights, promises and conditions between the parties to such Final Settlement that are associated with such [***] Enforcement.  Other than a Final Settlement Agreement, in no event will Puma enter into any other agreement, arrangement, obligation, right, promise or other conditions with the other party to such Final Settlement that is associated with such [***] Enforcement.

5. For clarity, the rights granted pursuant to this Amendment No. 2 do not grant Puma the right to sublicense rights under the [***] Patents, outside of a Final Settlement, to use products, other than Products, in the Territory, beyond those rights already granted to Puma under the Agreement, without the prior written approval of Pfizer.

6. Notwithstanding anything to the contrary in the Agreement, if Pfizer objects to the Proposed Settlement, Pfizer will [***]. Following any such objection of a Proposed Settlement by Pfizer, Puma shall consult with Pfizer on litigation strategy, choice of counsel, and fees and costs associated with [***] Enforcement, and Pfizer and Puma shall work together to reach mutual agreement on an acceptable license or settlement related to such [***] Enforcement.  After the end of each calendar quarter after such objection, Puma will [***]. Pfizer will [***] or as otherwise requested by Puma in writing.

7. Notwithstanding anything to the contrary in the Agreement, if any monetary recovery including, but not limited to, any damages, royalties, or other consideration, is received in connection with a [***] Enforcement (“Recovery”), such Recovery will be applied in the following order: (a) first, to Puma’s external costs and external expenses that were incurred solely in connection with such [***] Enforcement and settling any related suits or actions, including all such costs and expenses incurred in connection with preparing, negotiating and 

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Exhibit 10.1(d)

 

 

 

 

responding to any Proposed Settlement, Settlement Notice and Final Settlement relating to such [***] Enforcement, [***], (b) second, to Pfizer’s external costs and external expenses incurred solely in connection with such [***] Enforcement and settling any related suits or actions, including all such costs and expenses incurred in connection with preparing, negotiating and responding to any Proposed Settlement, Settlement Notice and Final Settlement relating to such [***] Enforcement, [***], and (c) finally, any remaining Recovery will [***]. Any payment to Pfizer in accordance with this Section 7 will be made by Puma to Pfizer to such bank account as has been designated by Pfizer pursuant to the Agreement within the later of [***] days of receipt of such recovery by Puma or [***] days of receipt of an undisputed accounting of Pfizer’s costs and expenses. Sections 5.1.5 and 5.2 of the Agreement will apply with respect to any such payment that may become due and owing to Pfizer in accordance with this Section 7. For the avoidance of doubt, Puma’s exercise of its rights under Section 1 of this Amendment No. 2 will trigger no obligation to pay Pfizer any amounts under the Agreement, including any Milestone Payment, Royalty or other amount required under Sections 5 or 8 of the Agreement, that are in addition to the amounts required to be paid to Pfizer under this Section 7. 

8. Failure to comply with the preceding Sections 1 and 7 shall be deemed a material breach by Puma resulting in termination of all additional rights granted to Puma pursuant to this Letter Agreement, unless Puma cures such breach within thirty (30) days of receiving notice thereof. 

9. Except as amended herein, all terms of the Agreement shall remain unchanged and in full force and effect. In the event of any conflict between this Letter Agreement and any term of the Agreement, this Letter Agreement shall control. 

Please indicate Puma’s agreement to the above by having an authorized officer of Puma sign and date where indicated below. 

 

 

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Sincerely, 

 

	
By:
	
/s/ Andy Schmeltz

	
 
	
 

	
Pfizer Inc.

 

Andy Schmeltz

Global President & General Manager, Pfizer Oncology

UNDERSTOOD, AGREED and ACCEPTED: 

 

	
Puma Biotechnology, Inc.

	
 
	
 

	
By:
	
/s/ Alan Auerbach

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