Document:

exv10w3

 

Exhibit 10.3

Promissory Note

Up to $30,000,000

     For value received, Tarragon Corporation, a Nevada corporation
(“Borrower”), promises to pay to the order of Beachwold Partners, L.P. , the
principal sum of Thirty Million Dollars ($30,000,000), or so much thereof as may be outstanding,
with interest on the unpaid principal balance thereof at the rate set forth in the Letter Agreement
(as defined below).

     1. Defined Terms. This Note is given pursuant to that certain letter agreement dated
as of the date hereof between Borrower and Lender (the “Letter Agreement”). As used in this Note,
(i) the term “Lender” means the holder of this Note, (ii) the term “Indebtedness” means the
principal of, interest on, or any other amounts due at any time under, this Note including late
charges and default interest, and (iii) “Event of Default” means any failure to pay the principal
balance hereof on the Maturity Date, or any failure by Borrower to make interest payments or other
payments due within applicable grace periods herein or under the Letter Agreement, or to otherwise
comply in any respect with its obligations under the Letter Agreement.

     2. Address for Payment. All payments due under this Note shall be payable at 1775
Broadway, 23rd Floor, New York, NY, Attn: William S. Friedman.

     3. Payment of Principal and Interest. Principal and interest shall be paid as
follows:

     Installments of interest only shall be payable within five days after demand, no more
frequently than monthly. All outstanding principal and interest shall be due and payable on the
earliest to occur of (i) January 2, 2008, or (ii) any earlier date on which the unpaid principal
balance of this Note becomes due and payable, by acceleration or otherwise (the “Maturity Date”).

     4. Application of Payments. If at any time Lender receives, from Borrower or
otherwise, any amount applicable to the Indebtedness which is less than all amounts due and payable
at such time, Lender may apply that payment to amounts then due and payable in any manner and in
any order determined by Lender, in Lender’s discretion. Borrower agrees that neither Lender’s
acceptance of a payment from Borrower in an amount that is less than all amounts then due and
payable nor Lender’s application of such payment shall constitute or be deemed to constitute either
a waiver of the unpaid amounts or an accord and satisfaction.

     5. Acceleration. If an Event of Default has occurred and is continuing, the entire
unpaid principal balance, any accrued interest, if any, and all other amounts payable under this
Note and any other loan document shall at once become due and payable, at the option of Lender,
without any prior notice to Borrower. Lender may exercise this option to accelerate regardless of
any prior forbearance.

 

 

Exhibit 10.3

     6. Late Charge. If any amount payable under this Note or the Letter Agreement or if
the principal amount due at the Maturity Date is not received by Lender within 20 days after the
amount is due, Borrower shall pay to Lender, within five days after demand by Lender, a late charge
equal to 4 percent of such amount. Borrower acknowledges that its failure to make timely payments
will cause Lender to incur additional expenses in servicing and processing the loan evidenced by
this Note (the “Loan”), and that it is extremely difficult and impractical to determine those
additional expenses. Borrower agrees that the late charge payable pursuant to this Paragraph
represents a fair and reasonable estimate, taking into account all circumstances existing on the
date of this Note, of the additional expenses Lender will incur by reason of such late payment.
The late charge is payable in addition to, and not in lieu of, any interest payable at the Default
Rate pursuant to Paragraph 7.

     7. Default Rate. So long as any monthly installment or any other payment due under
this Note remains past due for 30 days or more, interest under this Note shall accrue on the unpaid
principal balance from the earlier of the due date of the first unpaid monthly installment or other
payment due, as applicable, at a rate (the “Default Rate”) equal to the lesser of 4 percentage
points above the rate stated in the Letter Agreement or the maximum interest rate which may be
collected from Borrower under applicable law. If the unpaid principal balance and all accrued
interest are not paid in full on the Maturity Date, the unpaid principal balance and all accrued
interest shall bear interest from the Maturity Date at the Default Rate. Borrower also
acknowledges that its failure to make timely payments will cause Lender to incur additional
expenses in servicing and processing the Loan, that, during the time that any monthly installment
or other payment under this Note is delinquent for more than 30 days, Lender will incur additional
costs and expenses arising from its loss of the use of the money due and from the adverse impact on
Lender’s ability to meet is other obligations and to take advantage of other investment
opportunities, and that it is extremely difficult and impractical to determine those additional
costs and expenses. Borrower also acknowledges that, during the time that any monthly installment
or other payment due under this Note is delinquent for more than 30 days, Lender’s risk of
nonpayment of this Note will be materially increased and Lender is entitled to be compensated for
such increased risk. Borrower agrees that the increase in the rate of interest payable under this
Note to the Default Rate represents a fair and reasonable estimate, taking into account all
circumstances existing on the date of this Note, of the additional costs and expenses Lender will
incur by reason of the Borrower’s delinquent payment and the additional compensation Lender is
entitled to receive for the increased risks of nonpayment associated with a delinquent loan.

     8. Prepayments. This Note is prepayable in full or in part at any time, without
premium.

     9. Costs and Expenses. Borrower shall pay on demand all expenses and costs, including
fees and out-of-pocket expenses of attorneys and expert witnesses and costs of investigation,
incurred by Lender as a result of any default under this Note or the Letter Agreement or in
connection with efforts to collect any amount due under this Note, or to enforce the provisions of
the Letter Agreement, including those incurred in post-judgment collection efforts and in any
bankruptcy proceedings (including any action for relief from the automatic stay of any bankruptcy
proceeding) or judicial or non-judicial foreclosure proceeding.

 

 

Exhibit 10.3

     10. Forbearance. Any forbearance by Lender in exercising any right or remedy under
this Note or the Letter Agreement or otherwise afforded by applicable law, shall not be a waiver of
or preclude the exercise of that or any other right or remedy. The acceptance by Lender of any
payment after the due date of such payment, or in an amount which is less than the required
payment, shall not be a waiver of Lender’s right to require prompt payment when due of all other
payments or to exercise any right or remedy with respect to any failure to make prompt payment.
Enforcement by Lender of any remedy for Borrower’s obligations under this Note shall not constitute
an election by Lender of remedies so as to preclude the exercise of any other right or remedy
available to Lender.

     11. Waivers. Presentment, demand, notice of dishonor, protest, notice of
acceleration, notice of intent to demand or accelerate payment or maturity, presentment for
payment, notice of nonpayment, grace, and diligence in collecting the Indebtedness are waived by
Borrower, and all endorsers and guarantors of this Note and all other third party obligors.

     12. Loan Charges. Borrower and Lender intend at all times to comply with the laws of
the State of New York governing the maximum rate or amount of interest payable on or in connection
with this Note and the Indebtedness (or applicable United Sates federal law to the extent that it
permits Lender to contract for, charge, take, reserve, or receive a greater amount of interest than
under New York law). If the applicable law is ever judicially interpreted so as to render usurious
any amount payable under this Note, or contracted for, charged, taken, reserved or received with
respect to the Indebtedness, or of acceleration of the maturity of this Note, or if any prepayment
by Borrower results in Borrower having paid any interest in excess of that permitted by any
applicable law, then Borrower and Lender expressly intend that all excess amounts collected by
Lender shall be applied to reduce the unpaid principal balance of this Note (or, if this Note has
been or would thereby be paid in full, shall be refunded to Borrower), and the provisions of this
Note and the Letter Agreement immediately shall be deemed reformed and the amounts thereafter
collectible under this Note or the Letter Agreement reduced, without the necessity of the execution
of any new documents, so as to comply with any applicable law, but so as to permit the recovery of
the fullest amount otherwise payable under this Note or the Letter Agreement. The right to
accelerate the maturity of this Note does not include the right to accelerate any interest which
has not otherwise accrued on the date of such acceleration, and Lender does not intend to collect
any unearned interest in the event of acceleration. All sums paid or agreed to be paid to Lender
for the use, forbearance or detention of the Indebtedness shall, to the extent permitted by any
applicable law, be amortized, prorated, allocated and spread throughout the full term of the
Indebtedness until payment in full so that the rate or amount of interest on account of the
Indebtedness does not exceed the applicable usury ceiling. Notwithstanding any provision contained
in this Note that permits the compounding of interest, including any provision by which any accrued
interest is added to the principal amount of this Note, the total amount of interest that Borrower
is obligated to pay and Lender is entitled to receive with respect to the Indebtedness shall not
exceed the amount calculated on a simple (i.e. noncompounded) interest basis at the maximum
rate on principal amounts actually advanced to or for the account of Borrower, including all
current and prior advances.

 

 

Exhibit 10.3

     13. Commercial Purpose. Borrower represents that the Indebtedness is being incurred
by Borrower solely for the purpose of carrying on a business or commercial enterprise, and not for
personal, family or household purposes.

     14. Counting of Days. Except where otherwise specifically provided, any reference in
this Note to a period of “days” means calendar days, not Business Days.

     15. Governing Law. This Note shall be governed by the laws of the State of New York.

     16. Captions. The captions of the paragraphs of this Note are for convenience only
and shall be disregarded in construing this Note.

     17. Notices. All notices, demands and other communications required or permitted to
be given by Lender to Borrower pursuant to this Note shall be given by registered or certified
mail, or by overnight delivery service to Borrower at the address set forth below, and to the
Lender at the address set forth in Paragraph 2.

     18. Consent to Jurisdiction and Venue. Borrower agrees that any controversy arising
under or in relation to this Note shall be litigated exclusively in New York, New York (the
“Jurisdiction”). The state and federal courts and authorities with jurisdiction in the
Jurisdiction shall have exclusive jurisdiction over all controversies which shall arise under or in
relation to this Note. Borrower irrevocably consents to service, jurisdiction, and venue of such
courts for any such litigation and waives any other venue to which it might be entitled by virtue
of domicile, habitual residence or otherwise.

     19. WAIVER OF TRIAL BY JURY. BORROWER AND LENDER EACH (A) AGREE NOT TO ELECT A TRIAL BY JURY
WITH RESPECT TO ANY ISSUE ARISING OUT OF THIS NOTE OR THE RELATIONSHIP BETWEEN THE PARTIES AS
LENDER AND BORROWER THAT IS TRIABLE OF RIGHT BY A JURY AND (B) WAIVE ANY RIGHT TO TRIAL BY JURY
WITH RESPECT TO SUCH ISSUE TO THE EXTENT THAT ANY SUCH RIGHT EXISTS NOW OR IN THE FUTURE. THIS
WAIVER OF RIGHT TO TRIAL BY JURY IS SEPARATELY GIVEN BY EACH PARTY, KNOWINGLY AND VOLUNTARILY, WITH
THE BENEFIT OF COMPETENT LEGAL COUNSEL.

     In Witness Whereof, Borrower has signed and delivered this Note, or has
caused this Note to be signed and delivered by its duly authorized representative, on the
6th day of March, 2006, but effective for all purposes as of January 2, 2006.

	 	 	 	 	 
	 	Borrower:
 

Tarragon Corporation 

 	 
	 	By:  	                   /s/Robert P. Rothenberg
 	 
	 	 	Robert P. Rothenberg 	 
	 	 	Presidentexv10w54

 

Exhibit
10.54

CYTOKINETICS, INCORPORATED

EXECUTIVE EMPLOYMENT AGREEMENT

     This Executive Employment Agreement (the “Agreement”) is made and entered into by and between
David Cragg (the “Executive”) and Cytokinetics, Incorporated, a Delaware Corporation (the
“Company”), effective as of February 1, 2005 (the “Effective Date”).

RECITALS

WHEREAS: It is expected that the Company from time to time will consider the possibility of an
acquisition by another company or other change of control. The Board of Directors of the Company
(the “Board”) recognizes that such consideration can be a distraction to Executive and can cause
Executive to consider alternative employment opportunities. The Board has determined that it is in
the best interests of the Company and its stockholders to assure that the Company will have the
continued dedication and objectivity of Executive, notwithstanding the possibility, threat or
occurrence of a Change of Control of the Company.

WHEREAS: The Board believes that it is in the best interests of the Company and its stockholders to
provide Executive with an incentive to continue his or her employment and to motivate Executive to
maximize the value of the Company upon a Change of Control for the benefit of its stockholders.

WHEREAS: The Board believes that it is imperative to provide Executive with certain severance
benefits upon Executive’s termination of employment following a Change of Control. These benefits
will provide Executive with enhanced financial security and incentive and encouragement to remain
with the Company notwithstanding the possibility of a Change of Control.

WHEREAS: Certain capitalized terms used in the Agreement are defined in Section 11 below.

AGREEMENT

     NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties hereto
agree as follows:

     1. Term of Agreement. This Agreement shall terminate upon the date that all of the
obligations of the parties hereto with respect to this Agreement have been satisfied.

     2. At-Will Employment. The Company and Executive acknowledge that Executive’s
employment is and shall continue to be at-will, as defined under applicable law. If Executive’s
employment terminates for any reason, including (without limitation) any termination prior to a
Change of Control, Executive shall not be entitled to any payments, benefits, damages, awards or
compensation other than as provided by this Agreement or by law.

     3. Duties and Scope of Employment.

               (a) Positions and Duties. As of the Effective Date, Executive will serve as the Vice
President of Human Resources of the Company. Executive will render such business and

 

 

professional services in the performance of his duties, consistent with Executive’s position
within the Company, as will reasonably be assigned to him by the Company’s Board of Directors.

               (b) Obligations. During such time as the Executive is employed by the Company,
Executive will perform his duties faithfully and to the best of his ability and will devote his
full business efforts and time to the Company. During such time as the Executive is employed by
the Company, Executive agrees not to actively engage in any other employment, occupation or
consulting activity for any material direct or indirect remuneration without the prior approval of
the Board.

     4. Compensation.

               (a) Base Salary. During such time as the Executive is employed by the Company, the
Company will pay Executive an annual salary as determined in the discretion of the Board of
Directors or any committee thereof. The base salary will be paid periodically in accordance with
the Company’s normal payroll practices and will be subject to the usual, required withholding.
Executive’s salary will be subject to review and adjustments will be made based upon the Company’s
normal performance review practices.

               (b) Performance Bonus. Executive will be eligible to receive an annual bonus and other
bonuses, less applicable withholding taxes, as determined by the Board of Directors or any
committee thereof in the Board’s or such committee’s sole discretion.

               (c) Equity Compensation. Executive will be eligible to receive stock and option
grants, and other equity compensation awards, as determined by the Board of Directors or any
committee thereof in the Board’s or such committee’s sole discretion.

     5. Employee Benefits. During the time that Executive is an employee of the Company,
Executive will be entitled to participate in the Benefit Plans currently and hereafter maintained
by the Company of general applicability to other senior executives of the Company. The Company
reserves the right to cancel or change the Benefit Plans it offers to its employees at any time.

     6. Vacation. Executive will be entitled to vacation in accordance with the Company’s
vacation policy, with the timing and duration of specific vacations mutually and reasonably agreed
to by the parties hereto.

     7. Expenses. The Company will reimburse Executive for reasonable travel,
entertainment or other expenses incurred by Executive in the furtherance of or in connection with
the performance of Executive’s duties as an employee of the Company, in accordance with the
Company’s expense reimbursement policy as in effect from time to time.

     8. Severance Benefits.

               (a) Involuntary Termination Following a Change of Control. If within eighteen (18)
months following a Change of Control (X)(i) Executive terminates his or her employment with the
Company (or any parent or subsidiary of the Company) for Good Reason or (ii) the Company (or any
parent or subsidiary of the Company) terminates Executive’s employment for other than Cause, and
(Y) Executive signs and does not revoke a standard release of claims with the Company in a

-2-

 

form reasonably acceptable to the Company, then Executive shall receive the following
severance from the Company:

                         (i) Severance Payment. Executive will be entitled to (i) receive continuing payments
of severance pay (less applicable withholding taxes) at a rate equal to his base salary rate, as
then in effect, for a period of eighteen (18) months from the date of such termination, to be paid
periodically in accordance with the Company’s normal payroll policies; and (B) a lump-sum payment
equal to 100% of Executive’s target annual bonus as of the date of such termination.

                         (ii) Options; Restricted Stock. All of Executive’s then outstanding options to
purchase shares of the Company’s Common Stock (the “Options”) shall immediately vest and become
exercisable (that is, in addition to the shares subject to the Options which have vested and become
exercisable as of the date of such termination), but in no event shall the number of shares subject
to such Options which so vest exceed the total number of shares subject to such Options.
Additionally, all of the shares of the Company’s Common Stock then held by Executive subject to a
Company right of repurchase (the “Restricted Stock”) shall immediately vest and have such Company
right of repurchase with respect to such shares of Restricted Stock lapse (that is, in addition to
the shares of Restricted Stock which have vested as of the date of such termination), but in no
event shall the number of shares which so vest exceed the number of shares of Restricted Stock
outstanding immediately prior to such termination.

                         (iii) Continued Employee Benefits. Executive shall receive Company-paid coverage for
Executive and Executive’s eligible dependents under the Company’s Benefit Plans for a period equal
to the shorter of (i) eighteen (18) months or (ii) such time as Executive secures employment with
benefits generally similar to those provided in the Company’s Benefit Plans.

               (b) Timing of Severance Payments. Any lump-sum severance payment to which Executive
is entitled shall be paid by the Company to Executive in cash and in full, not later than ten (10)
calendar days after the date of the termination of Executive’s employment as provided in Section
8(a), and any other severance payments shall be paid in accordance with normal payroll policies as
provided in Section 8(a). If Executive should die before all amounts have been paid, such unpaid
amounts shall be paid in a lump-sum payment to Executive’s designated beneficiary, if living, or
otherwise to the personal representative of Executive’s estate.

               (c) Voluntary Resignation; Termination for Cause. If Executive’s employment with the
Company terminates (i) voluntarily by Executive other than for Good Reason or (ii) for Cause by the
Company, then Executive shall not be entitled to receive severance or other benefits except for
those as may then be established under the Company’s then existing severance and Benefits Plans or
pursuant to other written agreements with the Company.

               (d) Disability; Death. If the Company terminates Executive’s employment as a result
of Executive’s Disability, or Executive’s employment terminates due to his or her death, then
Executive shall not be entitled to receive severance or other benefits except for those as may then
be established under the Company’s then existing written severance and Benefits Plans or pursuant
to other written agreements with the Company.

-3-

 

               (e) Termination Apart from Change of Control. In the event Executive’s employment is
terminated for any reason, either prior to the occurrence of a Change of Control or after the
eighteen (18) month period following a Change of Control, then Executive shall be entitled to
receive severance and any other benefits only as may then be established under the Company’s
existing written severance and Benefits Plans, if any, or pursuant to any other written agreements
with the Company.

               (f) Exclusive Remedy. In the event of a termination of Executive’s employment within
eighteen (18) months following a Change of Control, the provisions of this Section 8 are intended
to be and are exclusive and in lieu of any other rights or remedies to which Executive or the
Company may otherwise be entitled, whether at law, tort or contract, in equity, or under this
Agreement. Executive shall be entitled to no benefits, compensation or other payments or rights
upon termination of employment following a Change in Control other than those benefits expressly
set forth in this Section 8.

     9. Conditional Nature of Severance Payments.

               (a) Proprietary Information and Invention Assignment Agreement. If Executive is in
material breach of the terms of the Proprietary Information and Invention Assignment Agreement, by
and between the Company and Executive, dated as of February 1, 2005 (the “Invention Agreement”),
including, without limitation, Executive’s obligations of confidentiality and of non-solicitation
contained in the Invention Agreement, then upon such breach by Executive: (i) Executive shall
refund to the Company all cash paid to Executive pursuant to Section 8 of this Agreement; and (ii)
all severance benefits pursuant to this Agreement shall immediately cease.

               (b) Non-Competition. Executive acknowledges that the nature of the Company’s
business is such that if Executive were to become employed by, or substantially involved in, the
business of a competitor of the Company during the eighteen (18) months following the termination
of Executive’s employment with the Company, it would be very difficult for Executive not to rely on
or use the Company’s trade secrets and confidential information. Thus, to avoid the inevitable
disclosure of the Company’s trade secrets and confidential information, Executive agrees and
acknowledges that Executive’s right to receive the severance payments set forth in this Agreement
(to the extent Executive is otherwise entitled to such payments) will be conditioned upon Executive
not directly or indirectly engaging in (whether as an employee, consultant, agent, proprietor,
principal, partner, stockholder, corporate officer, director or otherwise), nor having any
ownership interest in or participating in the financing, operation, management or control of, any
person, firm, corporation or business that competes with the Company or is a customer of the
Company. Notwithstanding the foregoing, Executive may own, directly or indirectly, up to 1% of the
capital stock of a company that competes with the Company, provided such capital stock is traded on
a national securities exchange or through the automated quotation system of a registered securities
association. Upon any breach of this section, all severance payments pursuant to this Agreement
will immediately cease.

               (c) Understanding of Obligations. Executive represents that he is fully aware of his
obligations under the Invention Agreement and hereunder, including, without limitation, the
reasonableness of the length of time, scope and geographic coverage of any such obligations.

-4-

 

     10. Limitation on Payments. In the event that the severance and other benefits
provided for in this Agreement or otherwise payable to Executive (i) constitute “parachute
payments” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the
“Code”) and (ii) but for this Section 10, would be subject to the excise tax imposed by Section
4999 of the Code, then Executive’s severance benefits shall be either:

               (a) delivered in full, or

               (b) delivered as to such lesser extent which would result in no portion of such severance
benefits being subject to excise tax under Section 4999 of the Code,

whichever of the foregoing amounts, taking into account the applicable federal, state and local
income taxes and the excise tax imposed by Section 4999, results in the receipt by Executive on an
after-tax basis, of the greatest amount of severance benefits, notwithstanding that all or some
portion of such severance benefits may be taxable under Section 4999 of the Code. Unless the
Company and Executive otherwise agree in writing, any determination required under this Section 10
shall be made in writing by the Company’s independent public accountants immediately prior to
Change of Control (the “Accountants”), whose determination shall be conclusive and binding upon
Executive and the Company for all purposes. For purposes of making the calculations required by
this Section 10, the Accountants may make reasonable assumptions and approximations concerning
applicable taxes and may rely on reasonable, good faith interpretations concerning the application
of Sections 280G and 4999 of the Code. The Company and Executive shall furnish to the Accountants
such information and documents as the Accountants may reasonably request in order to make a
determination under this Section. The Company shall bear all costs the Accountants may reasonably
incur in connection with any calculations contemplated by this Section 10. If there is a reduction
pursuant to this Section 10 of the severance benefits to be delivered to Executive, such reduction
shall first be applied to any cash amounts to be delivered to the Executive under this Agreement
and thereafter to any other severance benefits of Executive hereunder.

     11. Definition of Terms. The following terms referred to in this Agreement shall have
the following meanings:

               (a) Benefit Plans. “Benefit Plans” means plans, policies or arrangements that the
Company sponsors (or participates in) and that immediately prior to Executive’s termination of
employment provide Executive and/or Executive’s eligible dependents with medical, dental, vision
and/or financial counseling benefits. Benefit Plans do not include any other type of benefit
(including, but not by way of limitation, disability, life insurance or retirement benefits). A
requirement that the Company provide Executive and Executive’s eligible dependents with coverage
under the Benefit Plans will not be satisfied unless the coverage is no less favorable than that
provided to Executive and Executive’s eligible dependents immediately prior to Executive’s
termination of employment. Notwithstanding any contrary provision of this Section 11, but subject
to the immediately preceding sentence, the Company may, at its option, satisfy any requirement that
the Company provide coverage under any Benefit Plan by instead providing coverage under a separate
plan or plans providing coverage that is no less favorable or by paying Executive a lump-sum
payment sufficient to provide Executive and Executive’s eligible dependents with equivalent
coverage under a third party plan that is reasonably available to Executive and Executive’s
eligible dependents.

-5-

 

               (b) Cause. “Cause” means any of the following: (i) the failure by you to
substantially perform your duties with the Company (other than due to your incapacity as a result
of physical or mental illness for a period not to exceed 90 days); (ii) the engaging by you in
conduct which is materially injurious to the Company, its business or reputation, or which
constitutes gross misconduct; (iii) your material breach of the terms of this Agreement, the
Invention Agreement or any other agreements between you and the Company; (iv) the material breach
or taking of any action in material contravention of the policies of the Company adopted by the
Board of Directors or any committee thereof, including, without limitation, the Company’s Code of
Ethics, Insider Trading Compliance Program, Disclosure Process and Procedures or Corporate
Governance Guidelines; (v) your conviction for or admission or plea of no contest with respect to a
felony; or (vi) an act of fraud against the Company, the misappropriation of material property
belonging to the Company, or an act of violence against an officer, director, employee or
consultant of the Company; provided, however, that in the event that any of the foregoing events in
(i), (iii) or (iv) is capable of being cured, the Company shall provide written notice to you
describing the nature of such event, and you shall thereafter have thirty (30) business days to
cure such event.

               (c) Change of Control. “Change of Control” means the occurrence of any of the
following:

                         (i) Any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange
Act of 1934, as amended) becomes the “beneficial owner” (as defined in Rule 13d-3 under said Act),
directly or indirectly, of securities of the Company representing fifty percent (50%) or more of
the total voting power represented by the Company’s then outstanding voting securities; or

                         (ii) Any action or event occurring within a two-year period, as a result of which fewer than a
majority of the directors are Incumbent Directors. “Incumbent Directors” shall mean directors who
either (A) are directors of the Company as of the date hereof, or (B) are elected, or nominated for
election, to the Board with the affirmative votes of at least a majority of the Incumbent Directors
at the time of such election or nomination (but shall not include an individual whose election or
nomination is in connection with an actual or threatened proxy contest relating to the election of
directors to the Company); or

                         (iii) The consummation of a merger or consolidation of the Company with any other corporation,
other than a merger or consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by remaining outstanding or
by being converted into voting securities of the surviving entity) at least fifty percent (50%) of
the total voting power represented by the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation; or

                         (iv) The consummation of the sale, lease or other disposition by the Company of all or
substantially all the Company’s assets.

               (d) Disability. “Disability” shall mean that Executive has been unable to perform
his Company duties as the result of his incapacity due to physical or mental illness, and such
inability, at least twenty-six (26) weeks after its commencement, is determined to be total and
permanent by a physician selected by the Company or its insurers and reasonably acceptable to Executive or

-6-

 

Executive’s legal representative. Termination resulting from Disability may
only be effected after at least thirty (30) days’ written notice by the Company of its intention
to terminate Executive’s employment. In the event that Executive resumes the performance of
substantially all of his or her duties hereunder before the termination of his or her employment
becomes effective, the notice of intent to terminate shall automatically be deemed to have been
revoked.

               (e) Good Reason. “Good Reason” means any of the following unless such event is agreed
to, in writing or as set forth below, by you: (i) a material reduction in your salary or benefits
(excluding the substitution of substantially equivalent compensation and benefits), other than as a
result of a reduction in compensation affecting employees of the Company, or its successor entity,
generally; (ii) a material diminution of your duties or responsibilities relative to your duties
and responsibilities in effect immediately prior to the Change of Control, provided however, that,
in the case of the Company being acquired and made part of a larger organization, a change in your
title or reporting requirements where your duties, responsibilities and authority after the Change
of Control are functionally similar to your duties, responsibilities and authority prior to the
Change of Control (as, for example, when the Vice-President, Sales of the Company remains
responsible for sales of the Company’s products following a Change of Control but is not made the
Vice President, Sales of the acquiring corporation) shall not constitute “Good Reason;” (iii)
relocation of your place of employment to a location more than 50 miles from the Company’s office
location at the time of the Change of Control; and (iv) failure of a successor entity in any Change
of Control to assume and perform under this Agreement. If any of the events set forth above shall
occur, you shall give prompt written notice of such event to the Company, or its successor entity,
and if such event is not cured within thirty (30) days from such notice you may exercise your
rights to resign for Good Reason, provided that if you have not exercised such right within 45 days
of the date of such notice you shall be deemed to have agreed to the occurrence of such event.

     12. Arbitration.

               (a) General. In consideration of Executive’s service to the Company, its promise to
arbitrate all employment related disputes and Executive’s receipt of the compensation, pay raises
and other benefits paid to Executive by the Company, at present and in the future, Executive agrees
that any and all controversies, claims, or disputes with anyone (including the Company and any
employee, officer, director, shareholder or benefit plan of the Company in their capacity as such
or otherwise) arising out of, relating to, or resulting from Executive’s service to the Company
under this Agreement or otherwise or the termination of Executive’s service with the Company,
including any breach of this Agreement, will be subject to binding arbitration under the
Arbitration Rules set forth in California Code of Civil Procedure Section 1280 through 1294.2,
including Section 1283.05 (the “Rules”) and pursuant to California law. Disputes which Executive
agrees to arbitrate, and thereby agrees to waive any right to a trial by jury, include any
statutory claims under state or federal law, including, but not limited to, claims under Title VII
of the Civil Rights Act of 1964, the Americans with Disabilities Act of 1990, the Age
Discrimination in Employment Act of 1967, the Older Workers Benefit Protection Act, the California
Fair Employment and Housing Act, the California Labor Code, claims of harassment, discrimination or
wrongful termination and any statutory claims. Executive further understands that this Agreement
to arbitrate also applies to any disputes that the Company may have with Executive.

-7-

 

               (b) Procedure. Executive agrees that any arbitration will be administered by the
American Arbitration Association (“AAA”) and that a neutral arbitrator will be selected in a manner
consistent with its National Rules for the Resolution of Employment Disputes. The arbitration
proceedings will allow for discovery according to the rules set forth in the National Rules for the
Resolution of Employment Disputes or California Code of Civil Procedure. Executive agrees that the
arbitrator will have the power to decide any motions brought by any party to the arbitration,
including motions for summary judgment and/or adjudication and motions to dismiss and demurrers,
prior to any arbitration hearing. Executive agrees that the arbitrator will issue a written
decision on the merits. Executive also agrees that the arbitrator will have the power to award any
remedies, including attorneys’ fees and costs, available under applicable law. Executive
understands the Company will pay for any administrative or hearing fees charged by the arbitrator
or AAA except that Executive will pay the first $125.00 of any filing fees associated with any
arbitration Executive initiates. Executive agrees that the arbitrator will administer and conduct
any arbitration in a manner consistent with the Rules and that to the extent that the AAA’s
National Rules for the Resolution of Employment Disputes conflict with the Rules, the Rules will
take precedence.

               (c) Remedy. Except as provided by the Rules, arbitration will be the sole, exclusive
and final remedy for any dispute between Executive and the Company. Accordingly, except as
provided for by the Rules, neither Executive nor the Company will be permitted to pursue court
action regarding claims that are subject to arbitration. Notwithstanding, the arbitrator will not
have the authority to disregard or refuse to enforce any lawful Company policy, and the arbitrator
will not order or require the Company to adopt a policy not otherwise required by law which the
Company has not adopted.

               (d) Availability of Injunctive Relief. In addition to the right under the Rules to
petition the court for provisional relief, Executive agrees that any party may also petition the
court for injunctive relief where either party alleges or claims a violation of this Agreement or
the Confidentiality Agreement or any other agreement regarding trade secrets, confidential
information, nonsolicitation or Labor Code §2870. In the event either party seeks injunctive
relief, the prevailing party will be entitled to recover reasonable costs and attorneys fees.

               (e) Administrative Relief. Executive understands that this Agreement does not
prohibit Executive from pursuing an administrative claim with a local, state or federal
administrative body such as the Department of Fair Employment and Housing, the Equal Employment
Opportunity Commission or the workers’ compensation board. This Agreement does, however, preclude
Executive from pursuing court action regarding any such claim.

               (f) Voluntary Nature of Agreement. Executive acknowledges and agrees that Executive
is executing this Agreement voluntarily and without any duress or undue influence by the Company or
anyone else. Executive further acknowledges and agrees that Executive has carefully read this
Agreement and that Executive has asked any questions needed for Executive to understand the terms,
consequences and binding effect of this Agreement and fully understand it, including that Executive
is waiving Executive’s right to a jury trial. Finally, Executive agrees that Executive has been
provided an opportunity to seek the advice of an attorney of Executive’s choice before signing this
Agreement.

-8-

 

     13. Successors.

               (a) The Company’s Successors. Any successor to the Company (whether direct or
indirect and whether by purchase, merger, consolidation, liquidation or otherwise) to all or
substantially all of the Company’s business and/or assets shall assume the obligations under this
Agreement and agree expressly to perform the obligations under this Agreement in the same manner
and to the same extent as the Company would be required to perform such obligations in the absence
of a succession. For all purposes under this Agreement, the term “Company” shall include any
successor to the Company’s business and/or assets which executes and delivers the assumption
agreement described in this Section 13(a) or which becomes bound by the terms of this Agreement by
operation of law.

               (b) The Executive’s Successors. The terms of this Agreement and all rights of
Executive hereunder shall inure to the benefit of, and be enforceable by, Executive’s personal or
legal representatives, executors, administrators, successors, heirs, distributees, devisees and
legatees.

     14. Notice.

               (a) General. Notices and all other communications contemplated by this Agreement
shall be in writing and shall be deemed to have been duly given when personally delivered or when
mailed by U.S. registered or certified mail, return receipt requested and postage prepaid. In the
case of Executive, mailed notices shall be addressed to him or her at the home address which he or
she most recently communicated to the Company in writing. In the case of the Company, mailed
notices shall be addressed to its corporate headquarters, and all notices shall be directed to the
attention of its Chief Financial Officer.

               (b) Notice of Termination. Any termination by the Company for Cause or by Executive
for Good Reason or as a result of a voluntary resignation shall be communicated by a notice of
termination to the other party hereto given in accordance with Section 14(a) of this Agreement.
Such notice shall indicate the specific termination provision in this Agreement relied upon, shall
set forth in reasonable detail the facts and circumstances claimed to provide a basis for
termination under the provision so indicated, and shall specify the termination date (which shall
be not more than thirty (30) days after the giving of such notice).

     15. Miscellaneous Provisions.

               (a) No Duty to Mitigate. Executive shall not be required to mitigate the amount of
any payment contemplated by this Agreement, nor, except as otherwise contemplated in this
Agreement, shall any such payment be reduced by any earnings that Executive may receive from any
other source.

               (b) Waiver. No provision of this Agreement shall be modified, waived or discharged
unless the modification, waiver or discharge is agreed to in writing and signed by Executive and by
an authorized officer of the Company (other than Executive). No waiver by either party of any
breach of, or of compliance with, any condition or provision of this Agreement by the other party

-9-

 

shall be considered a waiver of any other condition or provision or of the same condition or
provision at another time.

               (c) Headings. All captions and section headings used in this Agreement are for
convenient reference only and do not form a part of this Agreement.

               (d) Entire Agreement. This Agreement and the Invention Agreement constitute the
entire agreement of the parties hereto and supersedes in their entirety all prior representations,
understandings, undertakings or agreements (whether oral or written and whether expressed or
implied) of the parties with respect to the subject matter hereof. No future agreements between
the Company and Executive may supersede this Agreement, unless they are in writing and specifically
mentioned this Agreement.

               (e) Choice of Law. The laws of the State of California (without reference to its
choice of laws provisions) shall govern the validity, interpretation, construction and performance
of this Agreement.

               (f) Severability. The invalidity or unenforceability of any provision or provisions
of this Agreement shall not affect the validity or enforceability of any other provision hereof,
which shall remain in full force and effect.

               (g) Withholding. All payments made pursuant to this Agreement will be subject to
withholding of applicable income and employment taxes.

               (h) Counterparts. This Agreement may be executed in counterparts, each of which shall
be deemed an original, but all of which together will constitute one and the same instrument.

[Remainder of Page Intentionally Left Blank]

-10-

 

     IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the
Company by its duly authorized officer, as of the day and year set forth below.

	 	 	 	 	 	 	 
	COMPANY	 	CYTOKINETICS, INCORPORATED	 	 
	 

	 	By:
	 	/s/James Sabry	 	 
	 

	 	 
	 	 

	 	 
	 

	 	Title:	 	President & CEO	 	 
	 

	 	 	 	 	 	 

	 	 	 	 	 
	EXECUTIVE

	By: 	 /s/David Cragg
  

	 	 
	 

	 	David Cragg, Vice President of Human	 	 
	 

	 	Resources	 	 

-11-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00099-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00099-of-00352.parquet"}]]