Document:

alny-ex105_536.htm

Confidential

 
Exhibit 10.5
 

AMENDED AND RESTATED INVESTOR AGREEMENT

By and Between

GENZYME CORPORATION

AND

ALNYLAM PHARMACEUTICALS, INC.

Dated as of April 8, 2019

 

 

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED AND REPLACED WITH “[***]”. SUCH IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THIS EXHIBIT BECAUSE IT IS (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM TO THE COMPANY IF DISCLOSED.

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TABLE OF CONTENTS

Page

1.Definitions1

2.Intentionally Omitted6

3.Restrictions on Beneficial Ownership6

	
 
	
3.1
	
Standstill6
	
 

	
 
	
3.2
	
Company Agreements7
	
 

4.Restrictions on Dispositions9

	
 
	
4.1
	
Intentionally Omitted9
	
 

	
 
	
4.2
	
Limitations on Dispositions9
	
 

	
 
	
4.3
	
Certain Tender Offers10
	
 

	
 
	
4.4
	
Offering Lock-Up10
	
 

5.Voting Agreement10

	
 
	
5.1
	
Voting of Securities10
	
 

	
 
	
5.2
	
Certain Extraordinary Matters12
	
 

6.Right of First Offer12

	
 
	
6.1
	
Right of First Offer12
	
 

	
 
	
6.2
	
Limitations12
	
 

	
 
	
6.3
	
Expiration14
	
 

7.Intentionally Omitted14

8.Information Rights14

	
 
	
8.1
	
Intentionally Omitted14
	
 

	
 
	
8.2
	
Financial Information and Reporting14
	
 

	
 
	
8.3
	
Confidentiality15
	
 

9.Termination of Certain Rights and Obligations15

	
 
	
9.1
	
Termination of Standstill Agreement15
	
 

	
 
	
9.2
	
Termination of Restrictions on Dispositions15
	
 

	
 
	
9.3
	
Termination of Voting Agreement and Offering Lock-Up15
	
 

	
 
	
9.4
	
Termination of Right of First Offer16
	
 

	
 
	
9.5
	
Effect of Termination16
	
 

10.Miscellaneous16

	
 
	
10.1
	
Governing Law; Submission to Jurisdiction16
	
 

	
 
	
10.2
	
Waiver17
	
 

	
 
	
10.3
	
Notices17
	
 

	
 
	
10.4
	
Entire Agreement17
	
 

	
 
	
10.5
	
Amendments17
	
 

	
 
	
10.6
	
Headings; Nouns and Pronouns; Section References17
	
 

	
 
	
10.7
	
Severability18
	
 

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10.8
	
Assignment18
	
 

	
 
	
10.9
	
Successors and Assigns18
	
 

	
 
	
10.10
	
Counterparts18
	
 

	
 
	
10.11
	
Third Party Beneficiaries18
	
 

	
 
	
10.12
	
No Strict Construction18
	
 

	
 
	
10.13
	
Remedies18
	
 

	
 
	
10.14
	
Specific Performance18
	
 

	
 
	
10.15
	
No Conflicting Agreements19
	
 

	
 
	
10.16
	
Rule 16b-319
	
 

	
 
	
10.17
	
[***]19
	
 

 

 

Exhibit A – Form of Irrevocable Proxy
Exhibit B – Notices

 

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AMENDED AND RESTATED INVESTOR AGREEMENT

THIS AMENDED AND RESTATED INVESTOR AGREEMENT (this “Agreement”) is made as of April 8, 2019, by and between Genzyme Corporation (“Investor”), a Massachusetts corporation with its principal place of business at 500 Kendall Street, Cambridge, MA 02142, and Alnylam Pharmaceuticals, Inc. (the “Company”), a Delaware corporation with its principal place of business at 300 Third Street, Cambridge, MA 02142.

WHEREAS, that certain Stock Purchase Agreement, dated as of January 11, 2014, by and between the Investor and the Company (the “Purchase Agreement”), provides for the issuance and sale by the Company to the Investor, and the purchase by the Investor, of a number of shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”), equal to the Share Amount (as defined in the Purchase Agreement) (the “Purchased Shares”); 

WHEREAS, as a condition to consummating the transactions contemplated by the Purchase Agreement, the Company and the Investor entered into that certain Investor Agreement dated as of February 27, 2014 (the “Original Investor Agreement”); and

WHEREAS, the Company and the Investor wish to amend and restate the Original Investor Agreement in its entirety as of the date hereof, as set forth herein.  

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

Definitions

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

(a)“Acquisition Proposal” shall have the meaning set forth in Section 3.1(c).

(b)“Affiliate” shall mean, with respect to a Person, any other Person which controls, is controlled by or is under common control with the applicable Person.  For purposes of this definition, “control” shall mean: (a) in the case of corporate entities, direct or indirect ownership of at least fifty percent (50%) of the stock or shares entitled to vote for the election of directors, or otherwise having the power to control or direct the affairs of such Person; and (b) in the case of non-corporate entities, direct or indirect ownership of at least fifty percent (50%) of the equity interest or the power to direct the management and policies of such non-corporate entities.

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

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

(e)“beneficial owner,” “beneficially owns,” “beneficial ownership” and terms of similar import used in this Agreement shall, with respect to a Person, have the 

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meaning set forth in Rule 13d-3 under the Exchange Act (i) assuming the full conversion into, and exercise and exchange for, shares of Common Stock of all Common Stock Equivalents beneficially owned by such Person and (ii) determined without regard for the number of days in which such Person has the right to acquire such beneficial ownership.

(f)“Business Day” shall mean a day on which commercial banking institutions in New York, New York are open for business.

(g)“Change of Control” shall mean, with respect to the Company, any of the following events: (i) any Person is or becomes the beneficial owner (except that a Person shall be deemed to have beneficial ownership of all shares that any such Person has the right to acquire, whether such right which may be exercised immediately or only after the passage of time), directly or indirectly, of a majority of the total voting power represented by all Shares of Then Outstanding Common Stock; (ii) the Company consolidates with or merges into another corporation or entity, or any corporation or entity consolidates with or merges into the Company, other than (A) a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof) a majority of the combined voting power of the voting securities of the Company or such surviving entity or any parent thereof outstanding immediately after such merger or consolidation, (B) a merger or consolidation which would result in a majority of the board of directors of the combined entity being comprised of members of the board of directors of the pre-transaction Company and the chief executive officer of the combined entity being the chief executive officer of the pre-transaction Company, in each case immediately following the consummation of such merger or consolidation, or (C) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Person becomes the beneficial owner, directly or indirectly, of a majority of the total voting power of all Shares of Then Outstanding Common Stock or (iii) the Company conveys, transfers or leases all or substantially all of its assets to any Person other than a wholly owned Affiliate of the Company. 

(h)“Clinical Study” shall have the meaning set forth in the Master Agreement.

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

(j)“Collaboration Agreement” shall mean the Master Agreement and the License Terms.

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

(l)“Common Stock Equivalents” shall mean any options, warrants or other securities or rights convertible into or exercisable or exchangeable for, whether directly or following conversion into or exercise or exchange for other options, warrants or other securities or rights, shares of Common Stock.

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

(n)“Dilutive Event” shall have the meaning set forth in Section 3.2(c).

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

(p)“Election Notice Date” shall have the meaning set forth in Section 3.2(c).

(q)“Excepted Compensatory Issuance” shall have the meaning set forth in Section 6.2.

(r)“Excepted Transactional Issuance” shall have the meaning set forth in Section 6.2.

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

(t)“Exclusive TTR Agreement” shall mean the Exclusive License Agreement between the Investor and the Company, dated as of January 6, 2018 and as amended from time to time.

(u)“Exercise Period” shall have the meaning set forth in Section 6.1.

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

(w)“Governmental Authority” shall mean any court, agency, authority, department, regulatory body or other instrumentality of any government or country or of any national, federal, state, provincial, regional, county, city or other political subdivision of any such government or country or any supranational organization of which any such country is a member.

(x)“Holders” shall mean (but, in each case, only for so long as such Person remains an Affiliate of the Investor) the Investor and any Permitted Transferee thereof, if any.

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

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

(aa)“Later Block Sale” shall have the meaning set forth in Section 4.2.

(bb)“Law” or “Laws” shall mean all laws, statutes, rules, regulations, orders, judgments, injunctions and/or ordinances of any Governmental Authority.

(cc)“License Terms” shall mean the Amended and Restated ALN-AT3 Global License Terms between the Company and the Investor, dated as of April 8, 2019, and as amended from time to time.

(dd)“Master Agreement” shall mean that certain Master Collaboration Agreement between the Investor and Company, dated as of January 11, 2014, as amended by Amendment No. 1 to the Master Collaboration Agreement dated July 1, 2015, Amendment No 2. to the Master Collaboration Agreement dated January 6, 2018, and Amendment No. 3 to the Master Collaboration Agreement dated April 8, 2019, and as further amended from time to time.

(ee) “Modified Clause” shall have the meaning set forth in Section 10.7.

(ff)“New Securities” shall have the meaning set forth in Section 6.1.

(gg)“Offer Notice” shall have the meaning set forth in Section 6.1.

(hh)“Offeror” shall have the meaning set forth in Section 3.1(c).

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

(jj)“Permitted Transferee” shall mean (i) a controlled Affiliate of the Investor that is wholly owned, directly or indirectly, by the Investor, or (ii) a controlling Affiliate of the Investor (or any controlled Affiliate of such controlling Affiliate) that wholly owns, directly or indirectly, the Investor; it being understood that for purposes of this definition “wholly owned” shall mean an Affiliate in which the Investor owns, directly or indirectly, at least ninety-nine percent (99%) of the outstanding capital stock of such Affiliate.

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

(ll)“Potential Standstill Term Expiration Date” shall have the meaning set forth in Section 3.2(c).

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

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

(oo)“SEC” shall mean the United States Securities and Exchange Commission.

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

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

(rr)“Standstill Limit” shall mean thirty percent (30%) of the Shares of Then Outstanding Common Stock.

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

(tt)“Standstill Term” shall mean the period from and after the date of this Agreement until the earlier of (i) the fifth (5th) anniversary of the earlier of (a) the expiration of the Term and (b) the termination of the Collaboration Agreement and (ii) the date following December 31, 2021 on which (x) the beneficial ownership of the Investor and its Affiliates no longer represents at least five percent (5%) of the Shares of Then Outstanding Common Stock and (y) Investor delivers a written notice to the Company electing to terminate Section 3.1 (provided, however, that if the Investor and its Affiliates acquire beneficial ownership representing at least five percent (5%) of the Shares of Then Outstanding Common Stock at any time within one year after the beneficial ownership of the Investor and its Affiliates ceasing to represent at least five percent (5%) of the Shares of Then Outstanding Common Stock, the Standstill Term shall be automatically reinstated).

(uu)“Term” shall mean the period beginning on the Closing Date and ending on the expiration of the date of expiration of the last to expire Royalty Term under the License Terms or the Exclusive TTR License Agreement.

(vv)“Third Party” shall mean any Person other than the Investor, the Company or any of their respective Affiliates.

(ww)“Voting-Restricted Shares” shall mean all shares of Common Stock held by the Investor and its Affiliates; however, if the shares of Common Stock held by the Investor and its Affiliates comprise or exceed twenty percent (20%) of the Shares of Then Outstanding Common Stock, the term “Voting-Restricted Shares” shall only apply to the number 

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of shares of Common Stock held by the Investor and its Affiliates that is equal to 19.99% of the Shares of Then Outstanding Common Stock.

Intentionally Omitted

.  

Restrictions on Beneficial Ownership

.  

Standstill

.  During the Standstill Term, neither the Investor nor any of its Affiliates (collectively, the “Standstill Parties”) shall (and the Investor shall cause its Affiliates not to), except as expressly approved or invited in writing by the Company:

(a)directly or indirectly, acquire beneficial ownership of Shares of Then Outstanding Common Stock and/or Common Stock Equivalents, or make a tender, exchange or other offer to acquire Shares of Then Outstanding Common Stock and/or Common Stock Equivalents, if after giving effect to such acquisition, the Standstill Parties would beneficially own more than the Standstill Limit; provided, however, that notwithstanding the provisions of this Section 3.1(a), if the number of shares constituting Shares of Then Outstanding Common Stock is reduced or if the aggregate ownership of the Standstill Parties is increased as a result of a repurchase by the Company of Shares of Then Outstanding Common Stock, stock split, stock dividend or a recapitalization of the Company, the Standstill Parties shall not be required to dispose of any of their holdings of Shares of Then Outstanding Common Stock even though such action resulted in the Standstill Parties’ beneficial ownership totaling more than the Standstill Limit;

(b)directly or indirectly, (i) seek to have called any meeting of the stockholders of the Company, (ii) propose or nominate for election to the Company’s Board of Directors any person whose nomination has not been approved by a majority of the Company’s Board of Directors or (iii) unless a person referred to in the foregoing clause (ii) is nominated by a third party in connection with such party’s publicly announced and not withdrawn Acquisition Proposal (in which case the provisions of Section 5.1 shall apply to permit the Standstill Parties to either vote in accordance with the recommendation of the Company’s Board of Directors or in the same proportion as the votes cast by all other holders of all classes of voting securities of the Company), fail to cause to be voted in accordance with the recommendation of the Company’s Board of Directors with respect to such person for election to the Company’s Board of Directors any Shares of Then Outstanding Common Stock;

(c)directly or indirectly, encourage or support a tender, exchange or other offer or proposal by any other Person or group (an “Offeror”) the consummation of which would result in a Change of Control of the Company (an “Acquisition Proposal”); provided, however, that from and after the filing of a Schedule 14D-9 (or successor form of Tender Offer Solicitation/Recommendation Statement under Rule 14d-9 of the Exchange Act) by the Company recommending that stockholders accept any such offer, Investor shall not be prohibited from taking any of the actions otherwise prohibited by this Section 3.1(c) for so long as the Company maintains and does not withdraw such recommendation; 

(d)directly or indirectly, solicit proxies or consents or become a participant in a solicitation (as such terms are defined in Regulation 14A under the Exchange 

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Act) in opposition to the recommendation of a majority of the Company’s Board of Directors with respect to any matter, or seek to advise or influence any Person, with respect to voting of any Shares of Then Outstanding Common Stock of the Company;

(e)deposit any Shares of Then Outstanding Common Stock in a voting trust or subject any Shares of Then Outstanding Common Stock to any arrangement or agreement with respect to the voting of such Shares of Then Outstanding Common Stock;

(f)propose (i) any merger, consolidation, business combination, tender or exchange offer, purchase of the Company’s assets or businesses, or similar transaction involving the Company or (ii) any recapitalization, restructuring, liquidation or other extraordinary transaction with respect to the Company;

(g)act in concert with any Third Party to take any action in clauses (a) through (f) above, or form, join or in any way participate in a “partnership, limited partnership, syndicate, or other group” within the meaning of Section 13(d)(3) of the Exchange Act;

(h)enter into discussions, negotiations, arrangements or agreements with any Person relating to the foregoing actions referred to in (a) through (g) above; or

(i)request or propose to the Company’s Board of Directors, any member(s) thereof or any officer of the Company that the Company amend, waive, or consider the amendment or waiver of, any provisions set forth in this Section 3.1 (including this clause (i));

provided, however, that (A) nothing contained in this Section 3.1 shall prohibit the Investor from making confidential, non-public proposals to, or entering into confidential, non-public discussions, negotiations, arrangements or agreements with, the Company and with third parties with the express authorization of the Company, which the Investor or any Affiliate may request in a confidential, non-public manner, regarding a transaction or matter of the type described in the foregoing clauses (a) and (f), (B) the mere voting in accordance with Section 5 hereof of any voting securities of the Company held by the Investor or its Affiliates shall not constitute a violation of any of clauses (a) through (h) above, and (C) nothing in the foregoing clause (b) shall prohibit the Investor from proposing to the Company’s Nominating and Corporate Governance Committee (and not pursuant to the advance notice provisions set forth in the Company’s bylaws), in a confidential, non public manner, potential director candidates for consideration by the Company’s Nominating and Corporate Governance Committee, which candidates the Investor believes would be in the best interest of the Company and its stockholders.

Company Agreements

.  

(a)During the Standstill Term, the Company shall not take any action or omit to take any action that would prevent or impede the Investor or its Affiliates from acquiring beneficial ownership of Shares of Then Outstanding Common Stock and/or Common Stock Equivalents to the extent that, after giving effect to such acquisition, the Standstill Parties would beneficially own less than the Standstill Limit, including by adopting a shareholder rights 

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plan applicable to the Standstill Parties that contains a threshold below the Standstill Limit if such shareholder rights plan does not otherwise permit the Investor to beneficially own up to the Standstill Limit, provided, however, that nothing contained in this Section 3.2(a) or elsewhere in this Agreement shall affect the Company’s ability to (i) take and disclose a position in accordance with Rule 14d-9, Rule 14e-2(a) or Item 1012(a) of Regulation M-A promulgated under the Exchange Act or (ii) make any disclosure to the Company’s stockholders, in each case if, in the good faith judgment of the Company’s Board of Directors, the failure to take such position and/or make such disclosure would be inconsistent with the directors’ fiduciary duties under applicable law or any disclosure requirements under applicable law. 

(b)Following expiration of the Standstill Term, the Company shall not take any action or omit to take any action that would force the Investor to dispose of any of its holdings of Shares of Then Outstanding Common Stock.  

(c)Upon the expiration of the Standstill Term (the “Potential Standstill Term Expiration Date”), in the event that the Standstill Parties beneficially own, in the aggregate, at least twenty percent (20%) of the Shares of Then Outstanding Common Stock, the Investor may deliver to the Company not later than five (5) business days following a Potential Standstill Term Expiration Date a written notice electing to reinstate the provisions of Section 3 and Section 5 and continue the Standstill Term as provided in this Section 3.2(c) (the “Election Notice Date”).  If such election is made, the provisions of Section 3 and Section 5 shall be reinstated and the provisions of such sections, including the Standstill Term, shall be deemed to have remained in effect at all times without interruption or tolling notwithstanding the occurrence of a Potential Standstill Term Expiration Date; provided, however, that the “Standstill Limit” shall instead be the percentage of Shares of Then Outstanding Common Stock beneficially owned, in the aggregate, by the Standstill Parties as of the Potential Standstill Term Expiration Date.  Following the Election Notice Date,  the “Standstill Term” shall terminate on  the date on which the Standstill Parties beneficially own, in the aggregate, less than twenty percent (20%) of the Shares of Then Outstanding Common Stock; provided, however, that if the beneficial ownership of the Investor and its Affiliates in the aggregate is reduced below such threshold as a direct result of dilution suffered upon an issuance of securities by the Company pursuant to an Excepted Transactional Issuance (a “Dilutive Event”), the Standstill Term shall instead terminate upon the earliest of (x) Investor’s failure to provide written notice to the Company of its election to purchase additional securities within the five (5) business day period set forth in Section 6.2 related to the applicable Dilutive Event, (y) Investor’s failure to consummate such purchase of additional securities of the Company pursuant to Section 6.2 within the time period set forth therein related to the applicable Dilutive Event or (z) the date of Investor’s purchase of additional securities of the Company pursuant to Section 6.2 related to the applicable Dilutive Event if, immediately following the consummation of such purchase, the Investor and its Affiliates beneficially own, in the aggregate, less than twenty percent (20%) of the Shares of Then Outstanding Common Stock.

(d)If the Company (i) permits any other Person or group to own Shares of Then Outstanding Common Stock and/or Common Stock Equivalents in the aggregate exceeding the Standstill Limit or (ii) executes a transaction with any other Person or group that (i) results in said Person or group becoming the beneficial owner of Shares of Then Outstanding Common Stock and/or Common Stock Equivalents in an amount equal to or greater than the 

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percentage ownership represented by the Purchased Shares on the date hereof and (ii) is a collaboration or other license agreement with the Company, the Company shall offer to the Investor an opportunity to amend Sections 3 and 5 of this Agreement in a manner such that such provisions would be consistent with the “standstill” terms and conditions upon which the Company permitted such other Person or group to own and act (or fail to act) with respect to the Company and the Company's Shares of Then Outstanding Common Stock and/or Common Stock Equivalents.  This Section 3.2(d) shall terminate and be of no further force or effect on the date on which the Investor and its Affiliates beneficially own, in the aggregate, less than seven and one-half percent (7.5%) of the Shares of Then Outstanding Common Stock; provided, however, that if the beneficial ownership of the Investor and its Affiliates in the aggregate is reduced below such threshold as a direct result of dilution suffered upon a Dilutive Event, this Section 3.2(d) shall instead terminate upon the earliest of (x) Investor’s failure to provide written notice to the Company of its election to purchase additional securities within the five (5) business day period set forth in Section 6.2 related to the applicable Dilutive Event, (y) Investor’s failure to consummate the purchase of additional securities of the Company pursuant to Section 6.2 within the time period set forth therein related to the applicable Dilutive Event or (z) the date of Investor’s purchase of additional securities of the Company pursuant to Section 6.2 related to the applicable Dilutive Event if, immediately following the consummation of such purchase, the Investor and its Affiliates beneficially own, in the aggregate, less than seven and one-half percent (7.5%) of the Shares of Then Outstanding Common Stock.

Restrictions on Dispositions

.  

Intentionally Omitted

.  

Limitations on Dispositions

.  Except for any transfer of Purchased Shares by the Investor to a Permitted Transferee, the Investor shall not, and shall cause its Affiliates not to, Dispose of any Purchased Shares at any time, except (i) in any transaction approved by the Company or (ii) pursuant to privately negotiated, fully bought block sale transactions to an underwriter or underwriters, which must be executed after market close; provided that (x) in no event shall any such block sale transaction (the “Later Block Sale”) occur fewer than thirty (30) days after an earlier block sale transaction without prior written authorization by the Company, unless the closing price of the Common Stock on the date of the proposed Later Block Sale has increased by ten percent (10%) or more as compared to the closing price of the Common Stock on the date of the last block sale transaction; (y) in any such block sale transaction, the Purchased Shares shall not be sold at a discount greater than or equal to ten percent (10%) of the closing price of the Common Stock on the date of the proposed block sale transaction, without prior written authorization by the Company; and (z) the Investor shall use its best efforts to limit the number of such block sale transactions to no more than four (4); provided, however, that in the event of adverse market conditions limiting the liquidity of the Common Stock, the Investor may enter into more than four (4) block sale transactions to one or more underwriters, each of which must be executed after market close and in a manner consistent with the volume limitations set forth in Rule 144 under the Securities Act (whether or not such limitations would by their terms apply to such sales).  The Investor will consult with the underwriter or underwriters in each such block sale transaction to determine the appropriate strategy to sell the Purchased Shares in accordance with this Section 4.2, with the goal of minimizing any adverse impact on the trading price of the Common Stock and minimizing filings with the SEC.

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Certain Tender Offers

.  Notwithstanding any other provision of this Section 4, this Section 4 shall not prohibit or restrict any Disposition of Purchased Shares by the Standstill Parties into (a) a tender offer by a Third Party which is not opposed by the Company’s Board of Directors (but only after the Company’s filing of a Schedule 14D-9, or any amendment thereto, with the SEC disclosing the recommendation of the Company’s Board of Directors with respect to such tender offer), unless Investor is then in breach of its obligations pursuant to Section 3.1 with respect to the tender offer or (b) an issuer tender offer by the Company.

Offering Lock-Up

.  If the Holders together beneficially own at least six percent (6%) of the Shares of Then Outstanding Common Stock, the Holders shall, if requested by the Company and an underwriter of Common Stock of the Company, agree not to Dispose of any Purchased Shares for a specified period of time, such period of time not to exceed ninety (90) days.  Such agreement shall be in writing in a form satisfactory to the Company, the underwriter(s) in such offering and shall contain customary exceptions to the restrictions set forth therein.  The Company may impose stop transfer instructions with respect to the Purchased Shares to the extent consistent with any such agreement until the end of the specified period of time.  The foregoing provisions of this Section 4.4 shall apply to the Holders only if the Company’s directors, officers and any holders of an equal or greater number of Shares of Then Outstanding Common Stock that are party to a collaboration, license or similar agreement with the Company are subject to similar lock-up restrictions.  Any discretionary waiver or termination of the restrictions of any or all of such agreements by the Company or the underwriters shall apply pro rata to all Holders subject to such agreements, based on the number of shares subject to such agreements.

Voting Agreement

.  

Voting of Securities

.  From and after the date of this Agreement, other than as permitted by Section 5.2 with respect to Extraordinary Matters or as required by Section 3.1(b) or 3.2(a), in any vote or action by written consent of the stockholders of the Company (including, without limitation, with respect to the election of directors), the Investor shall, and shall cause its respective Affiliates to, vote or execute a written consent with respect to the Voting-Restricted Shares, in the sole discretion of the Investor, either (a) in accordance with the recommendation of the Company’s Board of Directors or (b) in the case of a meeting of stockholders, if the Investor or an Affiliate of the Investor has delivered written notice to the Company at any time prior to the vote on any given matter (but in any event not less than five (5) Business Days prior to such vote), setting forth its intent to vote pursuant to this Section 5.1(b), in the same proportion as the votes cast by all other holders of all classes of voting securities of the Company (as estimated by the inspector of election immediately prior to the closing of the polls with respect to the vote on any given matter, subject to adjustment for the inspector of election’s final tabulation of votes cast).  In the event that the Investor or an Affiliate of the Investor does not deliver timely written notice to the Company as provided in Section 5.1(b), such Person shall be deemed to have elected to vote the Voting-Restricted Shares of the Company as to which it is entitled to vote as provided in Section 5.1(a).  In furtherance of this Section 5.1, the Investor hereby irrevocably appoints the Company and any individuals designated by the Company, and each of them individually, as the attorneys, agents and proxies, with full power of substitution and re-substitution in each of them, for the Investor, and in the name, place and stead of the Investor, to vote (or cause to be voted) in such manner as set forth 

10

ACTIVE/100404761.2  

 
 

 

in this Section 5.1 (but in any case, (i) in accordance with any written instruction from the Investor, properly delivered under this Section 5.1, to vote as contemplated by clause (b) above, and (ii) excluding any matter that is an Extraordinary Matter described in Section 5.2) with respect to the Voting-Restricted Shares, and Section 3.1(b) and Section 3.2(a) with respect to all Shares of Then Outstanding Common Stock beneficially owned by Investor and its Affiliates, with respect to which the Investor is or may be entitled to vote at any meeting of the Company held after the date hereof, whether annual or special and whether or not an adjourned meeting (the “Irrevocable Proxy”).  This Irrevocable Proxy is coupled with an interest, shall be irrevocable and binding on any successor in interest of the Investor and shall not be terminated by operation of law upon the occurrence of any event.  This Irrevocable Proxy shall operate to revoke and render void any prior proxy as to any securities of the Company heretofore granted by the Investor which is inconsistent herewith.  Notwithstanding the foregoing, the Irrevocable Proxy shall be effective if, at any annual or special meeting of the stockholders of the Company and at any adjournments or postponements of any such meetings, the Investor (A) fails to appear or otherwise fails to cause the Voting-Restricted Shares (in the case of matters referred to in this Section 5.1) and any securities of the Company (in the case of the matters referred to in Section 3) to be counted as present for purposes of calculating a quorum, or (B) fails to vote such securities of the Company in accordance with this Section 5.1, Section 3.1(b) and Section 3.2(a), in each case at least five (5) business days prior to the date of such stockholders’ meeting. The Irrevocable Proxy shall terminate upon the earlier of the expiration or termination of the voting agreement set forth in this Section 5.1.  The Investor shall cause any Affiliate of the Investor that may from time to time own of record (or the record holder holding on behalf of such Affiliate if owned beneficially) Voting-Restricted Shares (in the case of matters referred to in this Section 5.1) and any securities of the Company (in the case of the matters referred to in Section 3.1(b) and 3.2(a)), if and when requested by the Company from time to time, to promptly execute and deliver to the Company an irrevocable proxy, substantially in the form of Exhibit A attached hereto, and irrevocably appoint the Company and any individuals designated by the Company, and each of them individually, with full power of substitution and resubstitution, as its attorney, agent and proxy to vote (or cause to be voted) such securities of the Company as to which such Affiliate is entitled to vote, in such manner as each such attorney, agent and proxy or his substitute shall in its, his or her sole discretion deem appropriate or desirable with respect to the matters set forth in this Section 5.1, Section 3.1(b) and Section 3.2(a) (the “Affiliate Irrevocable Proxy”).  The Investor acknowledges, and shall cause its Affiliates to acknowledge, that any such proxy executed and delivered shall be coupled with an interest, shall constitute, among other things, an inducement for the Company to enter into this Agreement, shall be irrevocable and binding on any successor in interest of such Affiliate and shall not be terminated by operation of Law upon the occurrence of any event.  Such proxy shall operate to revoke and render void any prior proxy as to any securities of the Company heretofore granted by such Affiliate, to the extent it is inconsistent herewith.  The Investor acknowledges and agrees that it shall be a condition to any proposed transfer of any securities of the Company by the Investor to such Affiliate that such Affiliate execute and deliver to the Company an Affiliate Irrevocable Proxy, and that any purported transfer shall be void and of no force or effect if such Affiliate Irrevocable Proxy is not so executed and delivered at the closing of such transfer.  Such proxy shall terminate upon the earlier of the expiration or termination of this Section 5.1.  For the avoidance of doubt, this Section 5 does not apply to any Shares of Then Outstanding Common Stock other than the Voting-Restricted Shares, except as otherwise expressly contemplated by 

11

ACTIVE/100404761.2  

 
 

 

Section 3.1(b) and Section 3.2(a). In the event the Company’s stockholders are permitted to act by written consent, the Company and the Investor shall each negotiate in good faith with the other provisions as consistent as possible with the foregoing to govern the voting of the Investor’s and its Affiliates’ Voting-Restricted Shares and Shares of Then Outstanding Common Stock as closely as practicable to the foregoing.

Certain Extraordinary Matters

.  The Investor and its Affiliates may vote, or execute a written consent with respect to, any or all of the Voting-Restricted Shares of the Company as to which they are entitled to vote or execute a written consent, as they may determine in their sole discretion, with respect to the following matters (each such matter being an “Extraordinary Matter”):

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

(b)any liquidation or dissolution of the Company

Right of First Offer

.  

Right of First Offer

.  Subject to the terms and conditions of this Section 6 and applicable securities laws, if the Company proposes to offer or sell any shares of Common Stock or any Common Stock Equivalents (the “New Securities”), the Company shall give written notice (the “Offer Notice”) to the Investor stating (a) its bona fide intention to offer such New Securities, (b) the number of such New Securities to be offered, and (c) the structure of the proposed offering or sale.  By written notification to the Company within five (5) days after the date of the Offer Notice (the “Exercise Period”, the Investor may elect to purchase, upon the same terms and conditions as other purchasers in the offering or sale of the New Securities, up to that portion of such New Securities that would allow the Investor to maintain its percentage ownership of Shares of Then Outstanding Common Stock after the offering or sale of the New Securities.  The Investor shall be entitled to apportion the right of first offer hereby granted to it in such proportions as it deems appropriate, among itself and its Permitted Transferees that are “accredited investors” within the meaning of Rule 501(a) under the Securities Act.

Limitations

.  The right of first offer in Section 6.1 shall not be applicable to:

(a)securities issued or issuable in exchange and as consideration for the bona fide acquisition of another corporation or entity by the Company by consolidation, merger, purchase of all or substantially all of the assets, or other bona fide reorganization in which the Company acquires, in a single transaction or series of related transactions, all or substantially all of the assets of such other corporation or entity or fifty percent (50%) or more of the voting power of such other corporation or entity or fifty percent (50%) or more of the equity ownership of such other entity;

(b)securities issued or issuable in exchange and as consideration for the rights obtained in research, collaboration, license, development, strategic alliance or other similar agreements or strategic partnerships;

12

ACTIVE/100404761.2  

 
 

 

(c)securities issuable upon conversion of or with respect to any then previously-issued or outstanding securities;

(d)securities issued pursuant to arms’ length bank financings;

(e)shares of Common Stock and/or Common Stock Equivalents issued or issuable for compensatory purposes to employees, officers, directors, contractors, vendors, advisors or consultants of the Company or any of its subsidiaries (whether or not issued pursuant to a Company equity incentive plan); 

(f)securities issued as a dividend, stock split or distribution on the Common Stock; and

(g)any right, option or warrant to acquire any securities set forth in Section 6.2(a)-(f) above.

provided, however, in the event the Company issues New Securities in a transaction to which the right of first offer in Section 6.1 shall not apply pursuant to Sections 6.2(a), 6.2(b) or 6.2(d) (an “Excepted Transactional Issuance”) or Section 6.2(e) (an “Excepted Compensatory Issuance”), the Company shall grant the Investor the right, upon the terms and conditions set forth in this paragraph, (i) to purchase a number of securities of the same type as the New Securities issued in the Excepted Transactional Issuance (except that securities purchased by the Investor in connection with an Excepted Transactional Issuance involving a public offering shall be registered under the Securities Act only to the extent permitted by applicable law) such that the percentage of Common Stock or any Common Stock Equivalents of the Company held by the Investor immediately after giving effect to the issuance of such New Securities and the issuance and purchase by the Investor of such securities pursuant to this Section 6.2 shall equal the percentage of Common Stock or any Common Stock Equivalents of the Company held by the Investor immediately prior to the Excepted Transactional Issuance and (ii) to purchase a number of securities of the same type as the New Securities issued in Excepted Compensatory Issuances during the previous calendar year such that the percentage of Common Stock or any Common Stock Equivalents of the Company held by the Investor immediately after giving effect to the issuance of such New Securities in such Excepted Compensatory Issuances and the issuance and purchase by the Investor of such securities pursuant to this Section 6.2 shall equal the percentage of Common Stock or any Common Stock Equivalents of the Company that would have been held by the Investor had the applicable Excepted Compensatory Issuances not been made.  The Company shall, within five (5) business days after the consummation of an Excepted Transactional Issuance and within ten (10) business days after the end of each calendar year in respect of Excepted Compensatory Issuances, provide written notice to the Investor of the offer described in this clause.  The Investor shall have five (5) business days from the date of such notice to provide the Company with written notice of its election to exercise all or a portion of its purchase right under this clause, and such purchase shall be consummated within five (5) business days after the date of the Investor’s written election.  The price per security for the offer related to an Excepted Transactional Issuance shall be the greater of (x) the per security price of the New Securities issued in the Excepted Transactional Issuance and (y) the closing price, if any, of the New Securities on the date of purchase by the Investor pursuant to this Section 6.2; provided, however, that if the price per security of the New Securities issued in the Excepted 

13

ACTIVE/100404761.2  

 
 

 

Transactional Issuance is greater than the closing market price of the New Securities on the date of the definitive agreement for such Excepted Transactional Issuance, the foregoing price formula shall not apply, and the price per security shall be the closing market price of the New Securities on the date of purchase by the Investor pursuant to this Section 6.2.  The price per security for the offer related to Excepted Compensatory Issuances shall be the closing market price of the New Securities on the date of purchase by the Investor pursuant to this Section 6.2.

Expiration

.  In the event the Investor fails to exercise its right of first refusal within the Exercise Period for the entire amount of New Securities offered pursuant to Section 6.1 above, the Company shall have forty-five (45) days thereafter to it to sell or enter into an agreement (pursuant to which the sale of New Securities covered thereby shall be closed, if at all, within thirty (30) days from the date of such agreement) to sell the New Securities respecting which the Investor’s right of first refusal set forth in Section 6.1 was not exercised, at a price and upon terms no more favorable to the purchasers thereof than specified in the Offer Notice. In the event the Company has not sold within such forty-five (45) day period or entered into an agreement to sell the New Securities in accordance with the foregoing within such thirty (30) days, the Company shall not thereafter issue or sell any New Securities without first again offering such securities to the Investor in the manner provided in this Section 6.  If the Investor fails to exercise its right to purchase New Securities within the Exercise Period for the entire amount of New Securities offered pursuant to Section 6.1 above, but nevertheless expresses thereafter an interest in participating in such offering prior to such offering having been effected, the Company will use commercially reasonable efforts to include the Investor in such offering if the Company, in its reasonable discretion, determines that the inclusion of the Investor at such later time will not adversely affect the success of such offering.

Intentionally Omitted

.  

Information Rights

. 

Intentionally Omitted

.  

Financial Information and Reporting

.  Until the date on which the Investor and its Affiliates no longer beneficially own, in the aggregate, at least two and one-half percent (2.5%) of the Shares of Then Outstanding Common Stock, the Company will provide to Investor or its designated Affiliate the financial information described in this Section 8.2 as well as any financial information reasonably requested by Investor so that Investor can manage and account for its investment in the Company, including to determine the fair value of the Company’s investment or assess whether the Company needs to account for the investment using the equity method of accounting or otherwise, including making its management available to Investor for reasonable inquiries regarding its financial statements and performance.  If the Investor or its Affiliate (a) determines in good faith that such financial information is reasonably likely to be necessary with respect to the financial reporting of the Investor or its Affiliates and (b) provides the Company with written notice to such effect, then beginning as promptly as reasonably practicable but in no event later than the 120th day following such notice, the Company will deliver via overnight delivery and electronic mail to the Investor or its Affiliate the information described in Exhibit C hereto by the dates indicated on Exhibit C (as such Exhibit C may be 

14

ACTIVE/100404761.2  

 
 

 

updated by the Investor from time to time to reflect changes in the financial reporting requirements of the Investor or its Affiliates). 

Confidentiality

.  All confidential or proprietary information and data relating to the Company and its subsidiaries provided by the Company to the Investor pursuant to this Section 8 shall be deemed “Confidential Information” under the Master Agreement and accordingly shall be subject to the terms and conditions of the Master Agreement governing “Confidential Information.” 

Termination of Certain Rights and Obligations

.  

Termination of Standstill Agreement

.  Section 3, other than Sections 3.2(b) and (c), shall terminate and have no further force or effect, upon the earliest to occur of:

(a)provided that none of the Standstill Parties has violated Section 3.1(c), (d) or (f) with respect to the Offeror referred to in this clause (a), the public announcement by the Company or any Offeror of any definitive agreement between the Company and such Offeror and/or any of its Affiliates providing for a Change of Control of the Company;

(b)the expiration of the Standstill Term (subject to revival as set forth in the definition of such term);

(c)the date on which the Common Stock ceases to be registered pursuant to Section 12 of the Exchange Act; and

(d)a liquidation or dissolution of the Company;

provided, however, that if Section 3 terminates due to clause (a) above and such agreement is abandoned and no other similar transaction has been announced and not abandoned or terminated within ninety (90) days thereafter, the restrictions contained in Section 3 shall again be applicable until otherwise terminated pursuant to this Section 9.1.

Termination of Restrictions on Dispositions

.  Section 4 (other than Section 4.4) shall terminate and have no further force or effect upon the earliest to occur of:

(a)the consummation by an Offeror of a Change of Control of the Company;

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

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

Termination of Voting Agreement and Offering Lock-Up

.  Section 5 and Section 4.4 shall terminate and have no further force or effect upon the earliest to occur of:

15

ACTIVE/100404761.2  

 
 

 

(a)the consummation by an Offeror of a Change of Control of the Company;

(b)a liquidation or dissolution of the Company; 

(c)the date on which the Common Stock ceases to be registered pursuant to Section 12 of the Exchange Act; and

(d)the expiration or termination of the Standstill Term.

Termination of Right of First Offer

.  Section 6 shall terminate and have no further force or effect upon the earliest to occur of:

(a)the date on which the Investor and its Affiliates beneficially own, in the aggregate, less than seven and one-half percent (7.5%) of the Shares of Then Outstanding Common Stock; provided, however, that if the beneficial ownership of the Investor and its Affiliates in the aggregate is reduced below such threshold as a direct result of dilution suffered upon a Dilutive Event, Section 6 shall instead terminate upon the earliest of (x) Investor’s failure to provide written notice to the Company of its election to purchase additional securities within the five (5) business day period set forth in Section 6.2 related to the applicable Dilutive Event, (y) Investor’s failure to consummate the purchase of additional securities of the Company pursuant to Section 6.2 within the time period set forth therein related to the applicable Dilutive Event or (z) the date of Investor’s purchase of additional securities of the Company pursuant to Section 6.2 related to the applicable Dilutive Event if, immediately following the consummation of such purchase, the Investor and its Affiliates beneficially own, in the aggregate, less than seven and one-half percent (7.5%) of the Shares of Then Outstanding Common Stock.

(b)the consummation by an Offeror of a Change of Control of the Company;

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

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

Effect of Termination

.  No termination pursuant to any of Sections 9.1, 9.2, 9.3, or 9.4 shall relieve any of the parties (or the Permitted Transferee, if any) for liability for breach of or default under any of their respective obligations or restrictions under any terminated provision of this Agreement, which breach or default arose out of events or circumstances occurring or existing prior to the date of such termination.

Miscellaneous

.  

Governing Law; Submission to Jurisdiction

.  This Agreement shall be governed by and construed in accordance with the Laws of the State of Delaware, without regard to the conflict of laws principles thereof that would require the application of the Law of any other jurisdiction.  Any action brought, arising out of, or relating to this Agreement shall be brought in the Court of Chancery of the State of Delaware. Each party hereby irrevocably 

16

ACTIVE/100404761.2  

 
 

 

submits to the exclusive jurisdiction of said Court in respect of any claim relating to the validity, interpretation and enforcement of this Agreement, and hereby waives, and agrees not to assert, as a defense in any action, suit or proceeding in which any such claim is made that it is not subject thereto or that such action, suit or proceeding may not be brought or is not maintainable in such courts, or that the venue thereof may not be appropriate or that this agreement may not be enforced in or by such courts. The parties hereby consent to and grant the Court of Chancery of the State of Delaware jurisdiction over such parties and over the subject matter of any such claim and agree that mailing of process or other papers in connection with any such action, suit or proceeding in the manner provided in Section 10.3 or in such other manner as may be permitted by law, shall be valid and sufficient thereof.

Waiver

.  Waiver by a party of a breach hereunder by another party shall not be construed as a waiver of any subsequent breach of the same or any other provision.  No delay or omission by a party in exercising or availing itself of any right, power or privilege hereunder shall preclude the later exercise of any such right, power or privilege by such party.  No waiver shall be effective unless made in writing with specific reference to the relevant provision(s) of this Agreement and signed by a duly authorized representative of the party granting the waiver.

Notices

.  All notices, instructions and other communications hereunder or in connection herewith shall be in writing, shall be sent to the address of the relevant party set forth on Exhibit B attached hereto and shall be (a) delivered personally, (b) sent by registered or certified mail, return receipt requested, postage prepaid, (c) sent via a reputable nationwide overnight courier service or (d) sent by facsimile transmission, with a confirmation copy to be sent by registered or certified mail, return receipt requested, postage prepaid.  Any such notice, instruction or communication shall be deemed to have been delivered upon receipt if delivered by hand, three (3) Business Days after it is sent by registered or certified mail, return receipt requested, postage prepaid, one (1) Business Day after it is sent via a reputable nationwide overnight courier service or when transmitted with electronic confirmation of receipt, if transmitted by facsimile (if such transmission is made during regular business hours of the recipient on a Business Day; or otherwise, on the next Business Day following such transmission).  Any party may change its address by giving notice to the other parties in the manner provided above.

Entire Agreement

.  This Agreement and the Purchase Agreement contain the entire agreement among the parties with respect to the subject matter hereof and thereof and supersede all prior and contemporaneous arrangements or understandings, whether written or oral, with respect hereto and thereto.

Amendments

.  No provision in this Agreement shall be supplemented, deleted or amended except in a writing executed by an authorized representative of each of the parties hereto.

Headings; Nouns and Pronouns; Section References

.  Headings in this Agreement are for convenience of reference only and shall not be considered in construing this Agreement.  Whenever the context may require, any pronouns used herein shall include the corresponding masculine, feminine or neuter forms, and the singular form of names and 

17

ACTIVE/100404761.2  

 
 

 

pronouns shall include the plural and vice-versa.  References in this Agreement to a section or subsection shall be deemed to refer to a section or subsection of this Agreement unless otherwise expressly stated.

Severability

.  If, under applicable Laws, any provision hereof is invalid or unenforceable, or otherwise directly or indirectly affects the validity of any other material provision(s) of this Agreement in any jurisdiction (“Modified Clause”), then, it is mutually agreed that this Agreement shall endure and that the Modified Clause shall be enforced in such jurisdiction to the maximum extent permitted under applicable Laws in such jurisdiction; provided that the parties shall consult and use all reasonable efforts to agree upon, and hereby consent to, any valid and enforceable modification of this Agreement as may be necessary to avoid any unjust enrichment of either party and to match the intent of this Agreement as closely as possible, including the economic benefits and rights contemplated herein.

Assignment

.  Neither this Agreement nor any rights or duties of a party hereto may be assigned by such party, in whole or in part, without (a) the prior written consent of the Company in the case of any assignment by the Investor; or (b) the prior written consent of the Investor in the case of an assignment by the Company.

Successors and Assigns

.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

Counterparts

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

Third Party Beneficiaries

.  None of the provisions of this Agreement shall be for the benefit of or enforceable by any Third Party other than any Affiliate of the Investor.  No Third Party with the exception of any Affiliate of the Investor shall obtain any right under any provision of this Agreement or shall by reason of any such provision make any claim in respect of any debt, liability or obligation (or otherwise) against any party hereto.

No Strict Construction

.  This Agreement has been prepared jointly and will not be construed against any party.

Remedies

.  The rights, powers and remedies of the parties under this Agreement are cumulative and not exclusive of any other right, power or remedy which such parties may have under any other agreement or Law.  No single or partial assertion or exercise of any right, power or remedy of a party hereunder shall preclude any other or further assertion or exercise thereof.

Specific Performance

.  The Company and the Investor hereby acknowledge and agree that the rights of the parties hereunder are special, unique and of extraordinary character, and that if any party refuses or otherwise fails to act, or to cause its Affiliates to act, in accordance with the provisions of this Agreement, such refusal or failure would result in irreparable injury to the Company or the Investor, as the case may be, the exact amount of which would be difficult to ascertain or estimate and the remedies at law for which 

18

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would not be reasonable or adequate compensation.  Accordingly, if any party refuses or otherwise fails to act, or to cause its Affiliates to act, in accordance with the provisions of this Agreement, then, in addition to any other remedy which may be available to any damaged party at law or in equity, such damaged party will be entitled to seek specific performance and injunctive relief, without posting bond or other security, and without the necessity of proving actual or threatened damages, which remedy such damaged party will be entitled to seek in any court of competent jurisdiction.

No Conflicting Agreements

.  The Investor hereby represents and warrants to the Company that neither it nor any of its Affiliates is, as of the date of this Agreement, a party to, and agrees that neither it nor any of its Affiliates shall, on or after the date of this Agreement, enter into any agreement that conflicts with the rights granted to the Company in this Agreement.  The Company hereby represents and warrants to each Holder that it is not, as of the date of this Agreement, a party to, and agrees that it shall not, on or after the date of this Agreement, enter into, any agreement or approve any amendment to its Organizational Documents (as defined in the Purchase Agreement) with respect to its securities that conflicts with the rights granted to the Holders in this Agreement.  The Company further represents and warrants that the rights granted to the Holders hereunder do not in any way conflict with the rights granted to any other holder of the Company’s securities under any other agreements.

Rule 16b-3

.  If at any time in the future the Investor determines that Rule 16b-3 promulgated under the Exchange Act may be available to exempt from Section 16(b) of the Exchange Act a transaction between the Investor and the Company, the Company shall cooperate and use commercially reasonable efforts to take such actions, including by adopting appropriate resolutions of the Board of Directors of the Company, to permit the Investor to rely on such exemption. 

[***]

 

(Signature Page Follows)

 

19

ACTIVE/100404761.2  

 
 

 

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

GENZYME CORPORATION

	
 
	
By:
	
/s/ William J. Sibold

	
 
	
Name:
	
William J. Sibold

	
 
	
Title:
	
Chief Executive Officer

ALNYLAM PHARMACEUTICALS, INC.

	
 
	
By:
	
/s/ John M. Maraganore

	
 
	
Name:
	
John M. Maraganore

	
 
	
Title:
	
Chief Executive Officer

 

ACTIVE/100404761.2  

 
 

 

EXHIBIT A

FORM OF IRREVOCABLE PROXY

In order to secure the performance of the duties of the undersigned pursuant to Section 5.1 of the Amended and Restated Investor Agreement, dated as of April 8, 2019 (the “Agreement”), by and between Genzyme Corporation and Alnylam Pharmaceuticals, Inc. (the “Company”), the undersigned hereby irrevocably appoints the Company and any individual designated by the Company, and each of them individually, as the attorneys, agents and proxies, with full power of substitution and resubstitution in each of them, for the undersigned, and in the name, place and stead of the undersigned, to vote (or cause to be voted) in such manner as set forth in Section 5.1 of the Agreement (but in any case, (i) in accordance with any written instruction from the undersigned, properly delivered under Section 5.1 of the Agreement, to vote as contemplated by Section 5.1(b) of the Agreement and (ii) excluding any matter that is an Extraordinary Matter described in Section 5.2) with respect to all Voting-Restricted Shares (in the case of matters referred to in Section 5.1) and all securities of the Company (in the case of the matters referred to in Section 3.1(b) and Section 3.2(a)), which the undersigned is or may be entitled to vote at any meeting of the Company held after the date hereof, whether annual or special and whether or not an adjourned meeting.  This proxy is coupled with an interest, shall be irrevocable and binding on any successor in interest of the undersigned and shall not be terminated by operation of law upon the occurrence of any event.  This proxy shall operate to revoke and render void any prior proxy as to securities of the Company heretofore granted by the undersigned which is inconsistent herewith.  Notwithstanding the foregoing, this irrevocable proxy shall be effective if, at any annual or special meeting of the stockholders of the Company (or any consent in lieu thereof) and at any adjournments or postponements of any such meetings, the undersigned (A) fails to appear or otherwise fails to cause its voting securities of the Company to be counted as present for purposes of calculating a quorum, or (B) fails to vote such voting securities in accordance with Sections 3.1(b), 3.2(a) or 5.1 of the Agreement, in each case at least five (5) business days prior to the date of such stockholders’ meeting.  This proxy shall terminate upon the earlier of the expiration or termination of the voting agreement set forth in Section 5.1 of the Agreement.

[___________________________]

	
 
	
By:
	

	
 
	
Name:
	

	
 
	
Title:
	

 

 

A-1

ACTIVE/100404761.2  

 
 

 

EXHIBIT B

NOTICES

	
(a)
	
If to Genzyme Corporation:

Genzyme Corporation

50 Binney Street

Cambridge, Massachusetts 02142

Attention: Head of Rare Disease Business Unit

Facsimile: (617) 252-7600

with a copy to:

Genzyme Corporation

50 Binney Street

Cambridge, Massachusetts 02142

Attention: Head of Legal Global Functions

Facsimile: (617) 252-7553

and to:

Ropes & Gray LLP

Prudential Tower

800 Boylston Street

Boston, MA 02199-3600

Attention: Christopher D. Comeau, Esq.

Facsimile: (617) 235-0507

	
(b)
	
If to the Company:

Alnylam Pharmaceuticals, Inc.

300 Third Street

Cambridge, MA 02142

Attention:  Vice President – Legal

Facsimile: (617) 551-8101

with a copy to:

Goodwin Procter LLP

100 Northern Avenue

Boston, MA 02210

Attention: Mitchell S. Bloom, Esq.

Facsimile No.: (617) 523-1231

 

B-1

ACTIVE/100404761.2  

 
 

 

EXHIBIT C

The below chart summarizes the type of information needed to apply the at equity method for an associate that is disclosing its financial statements under another referential than IFRS.

 

 

					
	
INFORMATION
	
Ref
	
PERIOD
	
TIMING
	
COMMENT

 

	
Issued and outstanding shares by classes (Common, Preferred...)
	
 
	
Quarter
	
D+5
	
Rights attached to each class of shares is also needed in order to determine the appropriate ownership interest

	
Outstanding potential rights (Options, Convertible rights)
	
 
	
Quarter
	
D+5
	
 

	
YTD consolidated income statement (USGAAP)
	
A
	
Month
	
D+7
	
Estimate could be used at this deadline – (final numbers required at D+11)

	
YTD statement of comprehensive income (USGAAP)
	
B
	
Quarter
	
D+7
	
Same

	
Equity Roll forward including detail of equity transactions (USGAAP)
	
C
	
Quarter
	
D+7
	
Same

	
Summarized balance sheet (USGAAP) 
	
D
	
Quarter
	
D+7
	
Same

	
Main USGAAP/IFRS differences
	
E
	
Quarter
	
D+7
	
>5M$ 

	
Transactions between Sanofi & the Company
	
F
	
Quarter 
	
D+7
	
P&L, OCI and Balance Sheet

	
Transactions between Sanofi & the Company
	
 
	
Half-year
	
D+7
	
Off balance sheet

	
List of the Company’s subsidiaries
	
 
	
Annual
	
D+7
	
 

 

Other information needed as part of a first application of the equity method: 

- Detailed programs of share based payment awards as of 31 December 20Y-2, 31 December 20Y-1 and equity method date

 

 

The financial reporting schedules (referenced from A to F) to be obtained from the Company are presented below:

 

C-1

ACTIVE/100404761.2  

 
 

 

A/ YTD CONSOLIDATED INCOME STATEMENT (USGAAP)

 

			
	
Amounts in K$ (1)
	
YTD as of XX
	
 

	
 
	
Total 
	
Transactions with Sanofi

	
Net Sales
	
 
	
 

	
Other Revenue
	
 
	
 

	
Cost of goods sold
	
 
	
 

	
Gross profit
	
 
	
 

	
Research and development expense
	
 
	
 

	
Selling and general expenses
	
 
	
 

	
Other operating income & expense
	
 
	
 

	
Amortization of intangible assets
	
 
	
 

	
Impairment of intangible assets
	
 
	
 

	
Fair value re-measurement of contingent consideration liabilities 
	
 
	
 

	
Operating income
	
 
	
 

	
Financial expense
	
 
	
 

	
Financial income
	
 
	
 

	
Income before tax and associates & JV
	
 
	
 

	
Income tax expense
	
 
	
 

	
Share of profit/(loss) of associates and JV
	
 
	
 

	
Net income 
	
 
	
 

	
Attributable to non-controlling interests
	
 
	
 

	
Net income attributable to equity holders of the Company
	
 
	
 

	
 
	
(1)
	
Positive amount = income

 

C-2

ACTIVE/100404761.2  

 
 

 

B/ YTD CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME/LOSS (USGAAP)

				
	
Amounts in K$ (1)
	
Beginning period as of XX
	
Change in the period
	
Ending period as of XX

	
Net income
	
 
	
 
	
 

	
Other comprehensive income:
	
 
	
 
	
 

	
Actuarial gains (losses)
	
 
	
 
	
 

	
Tax effect on actuarial gains and losses
	
 
	
 
	
 

	
Unrealized gains & losses on available-for-sale financial assets
	
 
	
 
	
 

	
Tax effect on unrealized gains & losses on AFS
	
 
	
 
	
 

	
Cash flow hedge
	
 
	
 
	
 

	
Tax effect on cash flow hedge
	
 
	
 
	
 

	
Net investment hedge
	
 
	
 
	
 

	
Tax effect on net investment hedge
	
 
	
 
	
 

	
Change in currency translation difference
	
 
	
 
	
 

	
Other comprehensive income for the period, net of taxes
	
 
	
 
	
 

	
Total comprehensive income 
	
 
	
 
	
 

	
Of which attributable to non-controlling interests
	
 
	
 
	
 

	
 
	
(1)
	
Positive amount = income

C-3

ACTIVE/100404761.2  

 
 

 

 

C/ EQUITY ROLL FORWARD (USGAAP)

								
	
Amounts in K$ (1)
	
Number of Shares
	
Capital
	
Additional Paid in Capital
	
Accumulated retained earnings
	
Other Comprehensive income (loss)
	
Non-controlling interests
	
Total Equity

	
Beginning balance as of XX
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Net income for the period
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Other comprehensive income for the period
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Payment of dividends
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Increase in capital (2)
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Decrease in capital
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Repurchase of Shares
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Equity component of convertible notes
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Purchase of convertible note
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Warrants in connection of convertible notes
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Share-based payments:
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 Increase in capital in connection with exercise of stock options
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 Increase in capital in connection with restricted shares
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 Share-based payment expense
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 Excess tax benefit from share-based payment expense
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Other changes (3)
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Ending balance as of XX
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
(1)
	
Positive amount = credit

	
 
	
(2)
	
Other than share-based payments

	
 
	
(3)
	
To be detailed

C-4

ACTIVE/100404761.2  

 
 

 

D/ SUMMARIZED BALANCE SHEET (USGAAP)

 

			
	
Amounts in K$ (1)
	
YTD as of XX
	
 

	
ASSETS
	
Total 
	
Transactions with Sanofi

	
Non-current assets
	
 
	
(2)

	
Accounts receivable
	
 
	
 

	
Deferred tax assets – current portion
	
 
	
 

	
Other current assets
	
 
	
(2)

	
TOTAL ASSETS
	
 
	
 

	
 
	
(1)
	
Positive amount = debit balance

	
 
	
(2)
	
To be detailed 

 

 

			
	
Amounts in K$ (1)
	
YTD as of XX
	
	
LIABILITIES AND EQUITY
	
Total 
	
Transactions with Sanofi

	
Equity
	
 
	
 

	
Deferred revenue non-current portion
	
 
	
 

	
Other non-current liabilities
	
 
	
(2)

	
Accounts payable
	
 
	
 

	
Deferred revenue current portion
	
 
	
 

	
Other current liabilities
	
 
	
(2)

	
TOTAL LIABILITIES AND EQUITY
	
 
	
 

	
 
	
(1)
	
Positive amount = credit balance

	
 
	
(2)
	
To be detailed

 

 

C-5

ACTIVE/100404761.2  

 
 

 

E/IFRS-USGAAP differences 

								
	
Amounts in K$
	
Note
	
Beginning period as of XX
	
Net income
	
OCI
	
Other Equity
	
Ending period as of XX
	
Income Statement line affected

	
R&D expense resulting from payments of rights to a product or technology (before regulatory approval)
	
(1)
	
 
	
 
	
 
	
 
	
 
	
 

	
Amortization expense related to acquired R&D previously capitalized 
	
(1)
	
 
	
 
	
 
	
 
	
 
	
 

	
Impairment loss related to acquired R&D previously capitalized
	
(1)
	
 
	
 
	
 
	
 
	
 
	
 

	
Lease classification including land
	
(2)
	
 
	
 
	
 
	
 
	
 
	
 

	
Asset retirement obligations
	
(3)
	
 
	
 
	
 
	
 
	
 
	
 

	
Inventory capitalized prior regulatory approval
	
(4)
	
 
	
 
	
 
	
 
	
 
	
 

	
Reversal of inventory written off upon regulatory approval
	
(5)
	
 
	
 
	
 
	
 
	
 
	
 

	
Inventory samples
	
(6)
	
 
	
 
	
 
	
 
	
 
	
 

	
Deferred tax on intragroup inventory margin
	
(7)
	
 
	
 
	
 
	
 
	
 
	
 

	
Executive Stock Purchase Plan 
	
(8)
	
 
	
 
	
 
	
 
	
 
	
 

	
Share based payments (Income tax)
	
(9)
	
 
	
 
	
 
	
 
	
 
	
 

	
Actuarial gains & losses on postretirement benefits
	
(10)
	
 
	
 
	
 
	
 
	
 
	
 

	
Prior service costs on postretirement employee benefits
	
(11)
	
 
	
 
	
 
	
 
	
 
	
 

C-6

ACTIVE/100404761.2  

 
 

 

								
	
Expected return on plan asset
	
(12)
	
 
	
 
	
 
	
 
	
 
	
 

	
Asset ceiling (net pension asset)
	
(13)
	
 
	
 
	
 
	
 
	
 
	
 

	
Provision recognition – measurement
	
(14)
	
 
	
 
	
 
	
 
	
 
	
 

	
Long term provision discounting
	
(15)
	
 
	
 
	
 
	
 
	
 
	
 

	
Revenue recognition (TBD) 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
TOTAL
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
(1)
	
Capitalized under IFRS

	
 
	
(2)
	
Classification Operating versus Finance lease depending on criteria (IFRS/USGAAP) 

	
 
	
(3)
	
Recognition criteria & measurement differences between IFRS and USGAAP

	
 
	
(4)
	
Fully written down under Sanofi’s accounting policy

	
 
	
(5)
	
Reversal permitted under IFRS

	
 
	
(6)
	
Net Residual Value is zero under Sanofi’s accounting policy

	
 
	
(7)
	
Based on the buyer’s rate under IFRS versus seller’s rate under USGAAP

	
 
	
(8)
	
Compensation expense under IFRS

	
 
	
(9)
	
Deferred tax based on intrinsic value at each balance sheet date under IFRS – Only tax expected above tax effect of cumulative expense is recognized through equity

	
 
	
(10)
	
 Recognized immediately in OCI under IFRS

	
 
	
(11)
	
 Recognized as expense in the period of plan amendments under IFRS

	
 
	
(12)
	
 Expected return on plan assets determined by applying the discount rate under IFRS (market yields on high quality corporate bonds)

	
 
	
(13)
	
 Limitation required under IFRS

	
 
	
(14)
	
 Present obligation exists under IFRS and best estimate approach

	
 
	
(15)
	
 Discounted required under IFRS when the effect is material (>5M€)

C-7

ACTIVE/100404761.2  

 
 

 

F/ TRANSACTIONS WITH SANOFI –

 UPFRONT AND MILESTONE PAYMENTS:

							
	
Upfronts & Milestones paid by Sanofi
	
Amount in K$
	
Payment date
	
Deferred Revenue

Beginning period as of XX(1)
	
Payment during the period
	
Amount recognized as Revenue during the period (1)
	
Deferred Revenue Ending period as of XX (1)

	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
......
	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
(1)
	
Positive amount = credit amount in the balance sheet and income statement

 

OTHER ITEMS WITH P&L IMPACT:

			
	
 
	
Amount in K$ (1)
	
Line impacted in the consolidated P&L

	
Product sales to Sanofi
	
 
	
 

	
Royalties paid by Sanofi
	
 
	
 

	
R&D expense incurred by the Company funded by Sanofi
	
 
	
 

	
...
	
 
	
 

	
 
	
(1)
	
Positive amount = income; Negative amount = expense

 

OTHER GAINS & LOSSES RELATING TO TRANSACTIONS WITH SANOFI (Amounts >5M$) – to be detailed

Example: Gain or loss on non-current asset disposals to Sanofi.

 

 

 

 

 

 

 

 

 

C-8

ACTIVE/100404761.2alny-ex106_374.htm

Exhibit 10.6

 

STOCK PURCHASE AGREEMENT

BY AND BETWEEN

REGENERON PHARMACEUTICALS, INC.

AND

ALNYLAM PHARMACEUTICALS, INC.

 

DATED AS OF APRIL 8, 2019

ACTIVE/97613778.18  

 

 

 
 

 

TABLE OF CONTENTS

Page

	
1.
	
Definitions1

	
 
	
1.1
	
Defined Terms1

	
 
	
1.2
	
Additional Defined Terms3

	
2.
	
Purchase and Sale of Common Stock or Preferred Stock4

	
3.
	
Closing Date; Deliveries5

	
 
	
3.1
	
Closing Date5

	
 
	
3.2
	
Deliveries5

	
4.
	
Representations and Warranties of the Company5

	
 
	
4.1
	
Organization, Good Standing and Qualification6

	
 
	
4.2
	
Capitalization and Voting Rights6

	
 
	
4.3
	
Subsidiaries7

	
 
	
4.4
	
Authorization7

	
 
	
4.5
	
No Defaults7

	
 
	
4.6
	
No Conflicts8

	
 
	
4.7
	
No Governmental Authority or Third-Party Consents8

	
 
	
4.8
	
Valid Issuance of Shares8

	
 
	
4.9
	
Litigation8

	
 
	
4.10
	
Licenses and Other Rights; Compliance with Laws8

	
 
	
4.11
	
Company SEC Documents; Financial Statements; Nasdaq Stock Market9

	
 
	
4.12
	
Absence of Certain Changes9

	
 
	
4.13
	
Internal Controls; Disclosure Controls and Procedures9

	
 
	
4.14
	
Intellectual Property10

	
 
	
4.15
	
Offering10

	
 
	
4.16
	
No Integration10

	
 
	
4.17
	
Brokers’ or Finders’ Fees10

	
 
	
4.18
	
Not Investment Company10

	
 
	
4.19
	
Insurance10

	
 
	
4.20
	
No General Solicitation11

	
 
	
4.21
	
Foreign Corrupt Practices11

	
 
	
4.22
	
Regulation M Compliance11

	
 
	
4.23
	
Office of Foreign Assets Control11

	
 
	
4.24
	
U.S. Real Property Holding Corporation11

	
5.
	
Representations and Warranties of the Investor11

	
 
	
5.1
	
Organization; Good Standing11

	
 
	
5.2
	
Authorization11

	
 
	
5.3
	
No Conflicts12

	
 
	
5.4
	
No Governmental Authority or Third-Party Consents12

	
 
	
5.5
	
Purchase Entirely for Own Account12

	
 
	
5.6
	
Disclosure of Information12

	
 
	
5.7
	
Investment Experience and Accredited Investor Status12

i

 

 

	
 
	
5.8
	
Acquiring Person13

	
 
	
5.9
	
Restricted Securities13

	
 
	
5.10
	
Legends13

	
 
	
5.11
	
Financial Assurances13

	
6.
	
Investor’s Conditions to Closing13

	
 
	
6.1
	
Representations and Warranties13

	
 
	
6.2
	
Covenants14

	
 
	
6.3
	
Investor Agreement14

	
 
	
6.4
	
Collaboration Agreement14

	
 
	
6.5
	
No Material Adverse Effect14

	
 
	
6.6
	
Restated Certificate or Certificate of Designations14

	
7.
	
Company’s Conditions to Closing14

	
 
	
7.1
	
Representations and Warranties14

	
 
	
7.2
	
Covenants15

	
 
	
7.3
	
Investor Agreement15

	
 
	
7.4
	
Collaboration Agreement15

	
8.
	
Mutual Conditions to Closing15

	
 
	
8.1
	
HSR Act and Other Qualifications15

	
 
	
8.2
	
Injunctions15

	
 
	
8.3
	
Absence of Litigation15

	
 
	
8.4
	
No Prohibition; Market Listing15

	
9.
	
Termination15

	
 
	
9.1
	
Ability to Terminate15

	
 
	
9.2
	
Effect of Termination16

	
10.
	
Additional Covenants and Agreements16

	
 
	
10.1
	
Market Listing16

	
 
	
10.2
	
Notification under the HSR Act16

	
 
	
10.3
	
Assistance and Cooperation17

	
 
	
10.4
	
Effect of Waiver of Condition to Closing18

	
 
	
10.5
	
Nasdaq Matters18

	
 
	
10.6
	
Integration18

	
 
	
10.7
	
Blue Sky Filings18

	
 
	
10.8
	
Legend Removal18

	
 
	
10.9
	
Annual Meeting18

	
11.
	
Miscellaneous19

	
 
	
11.1
	
Governing Law; Submission to Jurisdiction19

	
 
	
11.2
	
Waiver19

	
 
	
11.3
	
Notices19

	
 
	
11.4
	
Entire Agreement19

	
 
	
11.5
	
Amendments20

	
 
	
11.6
	
Headings; Nouns and Pronouns; Section References20

	
 
	
11.7
	
Severability20

ii

 

 

	
 
	
11.8
	
Assignment20

	
 
	
11.9
	
Successors and Assigns20

	
 
	
11.10
	
Counterparts20

	
 
	
11.11
	
Third Party Beneficiaries20

	
 
	
11.12
	
No Strict Construction20

	
 
	
11.13
	
Survival of Warranties21

	
 
	
11.14
	
Remedies21

	
 
	
11.15
	
Expenses21

 

 

Exhibit A – Form of Certificate of Designations

Exhibit B - Notices

 

iii

 

 

STOCK PURCHASE AGREEMENT

THIS STOCK PURCHASE AGREEMENT (this “Agreement”), dated as of April 8, 2019, by and between Regeneron Pharmaceuticals, Inc. (the “Investor”), a New York corporation with its principal place of business at 777 Old Saw Mill River Road, Tarrytown, New York 10591, and Alnylam Pharmaceuticals, Inc. (the “Company”), a Delaware corporation with its principal place of business at 300 Third Street, Cambridge, Massachusetts 02142.

WHEREAS, pursuant to the terms and subject to the conditions set forth in this Agreement, the Company desires to issue and sell to the Investor, and the Investor desires to subscribe for and purchase from the Company, certain shares of common stock, par value $0.01 per share, of the Company (the “Common Stock”), or, if Shareholder Approval is not obtained prior to the date that the conditions to Closing set forth in Section 6, Section 7, and Section 8 have been satisfied or waived as provided therein, certain shares of Series A Redeemable Convertible Preferred Stock, par value $0.01 per share, of the Company (the “Preferred Stock”), having the preferences, rights and limitations set forth in the form of Certificate of Designations attached hereto as Exhibit A (the “Certificate of Designations”).

NOW, THEREFORE, in consideration of the following mutual promises and obligations, and for good and valuable consideration, the adequacy and sufficiency of which are hereby acknowledged, the Investor and the Company agree as follows:

1.Definitions

.

1.1Defined Terms

.  When used in this Agreement, the following terms shall have the respective meanings specified therefor below:

“Affiliate” shall mean, with respect to any Person, another Person which Controls, is Controlled by or is under common Control with such Person.  For the purposes of this Agreement, in no event shall the Investor or any of its Affiliates be deemed Affiliates of the Company or any of its Affiliates, nor shall the Company or any of its Affiliates be deemed Affiliates of the Investor or any of its Affiliates.

“Agreement” shall have the meaning set forth in the Preamble, including all Exhibits attached hereto.

“Business Day” shall mean a day on which commercial banking institutions in New York, New York are open for business.

“Collaboration Agreement” shall mean the Master Agreement by and between the Investor and the Company, dated as of April 8, 2019.

“Control” (including the terms “Controlled by” or “under common Control with”) 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 ownership of voting securities, by contract or otherwise. Without limiting the generality of the foregoing, a Person shall be deemed to Control another Person if any of the following conditions is met: (i) in the case of corporate entities, direct or indirect ownership of more than fifty percent (50%) of the stock or shares having the 

 

 

right to vote for the election of directors, and (ii) in the case of non-corporate entities, direct or indirect ownership of more than fifty percent (50%) of the equity interest with the power to direct the management and policies of such non-corporate entities.

“Controlled Affiliate” shall mean, with respect to a Person, an Affiliate of such Person Controlled by such Person.

“Effect” shall have the meaning set forth in the definition of “Material Adverse Effect.”

“Governmental Authority” shall mean any court, agency, authority, department or other instrumentality of any government or country or of any national, federal, state, provincial, regional, county, city or other political subdivision of any such government or country or any supranational organization of which any such country is a member.

“Intellectual Property” shall mean trademarks, trade names, trade dress, service marks, copyrights, 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” shall mean any license, permit, authorization, approval, contract or consent granted, issued by or with any Person relating to the use of Intellectual Property.

“Investor Agreement” shall mean the Investor Agreement by and between the Investor and the Company, dated as of April 8, 2019.

“Law” or “Laws” shall mean all laws, statutes, rules, regulations, orders, judgments, injunctions and/or ordinances of any Governmental Authority.

“Lien” shall mean a lien, charge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.

“Material Adverse Effect” shall mean any change, event or occurrence (each, an “Effect”) that, individually or when taken together with all other Effects, has (i) a material adverse effect on the business, financial condition, assets, results of operations or prospects of the Company and its subsidiaries, taken as a whole, or (ii) a material adverse effect on the Company’s ability to perform its obligations, or consummate the Transaction, in accordance with the terms of this Agreement, except in the case of (i) or (ii) to the extent that any such Effect results from or arises out of: (A) changes in conditions in the United States or global economy or capital or financial markets generally, including changes in interest or exchange rates, (B) changes in general legal, regulatory, political, economic or business conditions or changes in generally accepted accounting principles in the United States or interpretations thereof that, in each case, generally affect the biotechnology or biopharmaceutical industries, (C) the announcement of this Agreement or the Collaboration Agreement or the identity of the Investor, (D) any change in the trading prices or trading volume of the Common Stock (it being understood that the facts giving rise to or contributing to any such change may be deemed to constitute, or be taken into account when determining whether there has been or will be, a Material Adverse Effect, except to the extent any of such facts is an Effect referred in clauses (A) 

2

 

 

through (I) of this definition), (E) acts of war, sabotage or terrorism, or any escalation or worsening of any such acts of war, sabotage or terrorism, (F) earthquakes, hurricanes, floods or other natural disasters, (G) any action taken by the Company contemplated by this Agreement or in accordance with the Collaboration Agreement or with the Investor’s written consent, (H) any breach, violation or non-performance by the Investor or any of its Controlled Affiliates under the Collaboration Agreement, or (I) shareholder litigation arising out of or in connection with the execution, delivery or performance of the Transaction Agreements; provided, that, with respect to clauses (A), (B), (E) and (F), such Effect does not have a materially disproportionate and adverse effect on the Company relative to other companies in the biotechnology or biopharmaceutical industries.

“Organizational Documents” shall mean (i) the Restated Certificate of Incorporation of the Company dated as of June 3, 2004, as amended through the date of this Agreement and (ii) the Amended and Restated Bylaws of the Company, as amended through the date of this Agreement.

“Per Share Purchase Price” shall mean (i) if Common Stock is issued and sold hereunder, $90.00, or (ii) if Preferred Stock is issued and sold hereunder, $270.00.

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

“Shareholder Approval” shall mean the approval of the Company’s shareholders to amend the Company’s Restated Certificate of Incorporation to increase the number of authorized shares of Common Stock by at least the number of shares of Common Stock equal to the number of shares of Common Stock issuable hereunder.

“Termination Date” shall mean September 30, 2019.

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

“Transaction” shall mean the issuance and sale of the Shares by the Company, and the purchase of the Shares by the Investor, in accordance with the terms hereof.

“Transaction Agreements” shall mean this Agreement, the Investor Agreement and the Collaboration Agreement.

1.2Additional Defined Terms

.  In addition to the terms defined in Section 1.1, the following terms shall have the respective meanings assigned thereto in the sections indicated below:

		
	
Defined Term
	
Section

	
Aggregate Purchase Price
	
Section 2

3

 

 

		
	
Defined Term
	
Section

	
Certificate of Designations
	
Preamble

	
Closing
	
Section 3.1

	
Closing Date
	
Section 3.1

	
Common Stock
	
Preamble

	
Company
	
Preamble

	
Company SEC Documents
	
Section 4.11(a)

	
DOJ
	
Section 10.2(a)

	
Exchange Act
	
Section 4.11(a)

	
FTC
	
Section 10.2(a)

	
HSR Act
	
Section 4.7

	
Investor
	
Preamble

	
LAS
	
Section 4.7

	
Modified Clause
	
Section 11.7

	
Permits
	
Section 4.10

	
Preferred Stock
	
Preamble

	
SEC
	
Section 4.7

	
Securities Act
	
Section 4.11(a)

	
Shares
	
Section 2

	
Subsidiaries
	
Section 4.3

 

2.Purchase and Sale of Common Stock or Preferred Stock

.  Subject to the terms and conditions of this Agreement, at the Closing, the Company shall issue and sell to the Investor, free and clear of all liens, other than any liens arising as a result of any action by the Investor, and the Investor shall purchase from the Company, a number of shares of Common Stock, or, if Shareholder Approval is not obtained prior to the date that the conditions to Closing set forth in Section 6, Section 7, and Section 8 have been satisfied or waived as provided therein, a number of shares of Preferred Stock (such shares of Common Stock or Preferred Stock, as applicable, the “Shares”) equal to the amount obtained by dividing the aggregate purchase price of 

4

 

 

$400,000,000.00 (the “Aggregate Purchase Price”) by the Per Share Purchase Price rounded up to the nearest whole share.  In the event of any stock dividend, stock split, combination of shares, recapitalization or other similar change in the capital structure of the Company after the date hereof and on or prior to the Closing which affects or relates to the Common Stock, the number of Shares shall be adjusted proportionately.

 

3.Closing Date; Deliveries

.

3.1Closing Date

.  Subject to the satisfaction or waiver of all the conditions to the Closing set forth in Sections 6, 7 and 8 hereof, the closing of the purchase and sale of the Shares hereunder (the “Closing”) shall be held on the third (3rd) Business Day after the satisfaction of the conditions to Closing set forth in Sections 6, 7 and 8 (other than those conditions that by their nature are to be satisfied at the Closing), at 10:00 a.m. Boston time, at the offices of Goodwin Procter LLP, 100 Northern Avenue, Boston, Massachusetts 02210, or at such other time, date and location as the parties may agree in writing; provided, that in no event shall the Closing occur prior to the second Business Day following the 2019 annual meeting of stockholders of the Company.  The date the Closing occurs is hereinafter referred to as the “Closing Date.”

3.2Deliveries

.

(a)Deliveries by the Company.  At the Closing, the Company shall instruct its transfer agent to register the Shares in book-entry in the name of the Investor and shall cause the transfer agent to deliver written confirmation of the book-entry delivery of the Shares to the Investor.  The Company shall also deliver at the Closing: (i) a certificate in form and substance reasonably satisfactory to the Investor and duly executed on behalf of the Company by an authorized executive officer of the Company, certifying that the conditions to Closing set forth in Sections 6 and 8.3(b) of this Agreement have been fulfilled; (ii) a certificate of the secretary of the Company dated as of the Closing Date certifying (A) that attached thereto is a true and complete copy of the Amended and Restated Bylaws of the Company as in effect on the Closing Date; (B) that attached thereto is a true and complete copy of all resolutions adopted by the Board of Directors of the Company authorizing the execution, delivery and performance of the Transaction Agreements and the Transaction and that all such resolutions are in full force and effect and are all the resolutions adopted in connection with the transactions contemplated hereby as of the Closing Date; and (C) that attached thereto is a true and complete copy of the Company’s Restated Certificate of Incorporation, including the Certificate of Designations, if applicable, as in effect on the Closing Date; and (iii) a legal opinion of Goodwin Proctor LLP, counsel to the Company, in form and substance reasonably acceptable to the Investor. 

(b)Deliveries by the Investor.  At the Closing, the Investor shall deliver to the Company the Aggregate Purchase Price by wire transfer of immediately available United States funds to an account designated by the Company.  The Company shall notify the Investor in writing of the wiring instructions for such account not less than five (5) Business Days before the Closing Date.

4.Representations and Warranties of the Company

.  The Company hereby represents and warrants to the Investor that:

5

 

 

4.1Organization, Good Standing and Qualification

.

(a)Each of the Company and the Subsidiaries (as defined below) is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, with the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted.  Each of the Company and the Subsidiaries has all requisite corporate power and corporate authority to own, lease and operate its properties and assets, to carry on its business as now conducted, and as proposed to be conducted as described in the Company SEC Documents, and the Company has all requisite corporate power to enter into the Transaction Agreements to issue and sell the Shares and to perform its obligations under and to carry out the other transactions contemplated by the Transaction Agreements.

(b)Each of the Company and its Subsidiaries the qualified to transact business and is in good standing in each jurisdiction in which the character of the properties owned, leased or operated by the Company or Subsidiary, as applicable, or the nature of the business conducted by the Company or Subsidiary, as applicable, makes such qualification necessary, except where the failure to be so qualified would not have a Material Adverse Effect.

4.2Capitalization and Voting Rights

.

(a)The authorized capital of the Company as of the date hereof consists of: (i) 125,000,000 shares of Common Stock of which, as of the date of this Agreement, 106,437,145 shares are issued and outstanding and (ii) 5,000,000 shares of preferred stock, par value $0.01 per share, none of which are issued and outstanding as of the date of this Agreement.  All of the issued and outstanding shares of Common Stock (A) have been duly authorized and validly issued, (B) are fully paid and non-assessable and (C) were issued in compliance with all applicable federal and state securities Laws.

(b)All of the authorized shares of Common Stock are entitled to one (1) vote per share.  

(c)Except as described or referred to in Section 4.2(a) above, as provided in the Investor Agreement and as set forth in the Company SEC Documents, as of the date hereof, there are not: (i) any outstanding equity securities, options, warrants, rights (including conversion or preemptive rights) or other agreements pursuant to which the Company is or may become obligated to issue, sell or repurchase any shares of its capital stock or any other securities of the Company or (ii) except as set forth in the Investor Agreement, any restrictions on the transfer of capital stock of the Company other than pursuant to state and federal securities Laws.

(d)Except as provided in the Investor Agreement and as set forth in the Company SEC Documents, the Company is not a party to or subject to any agreement or understanding relating to the voting of shares of capital stock of the Company or the giving of written consents by a stockholder or director of the Company.

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(e)Except as provided in the Investor Agreement and as set forth in the Company’s filings with the SEC, no Person has any right to cause the Company to effect the registration under the Securities Act of any securities of the Company.

(f)The Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act nor has the Company received any notification that the SEC is contemplating terminating such registration.

4.3Subsidiaries

.  The Company has disclosed all of its subsidiaries required to be disclosed pursuant to Item 601(b)(21) of Regulation S-K in an exhibit to its Annual Report on Form 10-K (the “Subsidiaries”).  The Company owns, directly or indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all of the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights to subscribe for or purchase securities. 

4.4Authorization

.

(a)Subject to the Company’s receipt of the Shareholder Approval in the event that Common Stock is issued and sold hereunder, all requisite corporate action on the part of the Company, its directors and stockholders required by applicable Law for the authorization, execution and delivery by the Company of the Transaction Agreements and the performance of all obligations of the Company hereunder and thereunder, including the authorization, issuance and delivery of the Shares, has been taken; 

(b)Each of this Agreement and the Investor Agreement has been duly executed and delivered by the Company, and upon the due execution and delivery thereof by the Investor will constitute valid and legally binding obligations of the Company, enforceable against the Company in accordance with their respective terms (except as such enforceability may be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other Laws of general application relating to or affecting enforcement of creditors’ rights and (ii) rules of Law governing specific performance, injunctive relief or other equitable remedies and limitations of public policy).

(c)No stop order or suspension of trading of the Common Stock has been imposed by Nasdaq, the SEC or any other Governmental Authority and remains in effect.

4.5No Defaults

.  The Company is not in default under or in violation of (a) its Organizational Documents, (b) any provision of applicable Law or any ruling, writ, injunction, order, Permit, judgment or decree of any Governmental Authority or (c) any agreement, arrangement or instrument, whether written or oral, by which the Company or any of its assets are bound, except, in the case of subsections (b) and (c), as would not have a Material Adverse Effect.  There exists no condition, event or act which after notice, lapse of time, or both, would constitute a default or violation by the Company under any of the foregoing, except, in the case of subsections (b) and (c), as would not have a Material Adverse Effect.

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4.6No Conflicts

.  The execution, delivery and performance of the Transaction Agreements and compliance with the provisions thereof by the Company do not and shall not: (a) violate any provision of applicable Law or any ruling, writ, injunction, order, permit, judgment or decree of any Governmental Authority, (b) constitute a breach of, or default under (or an event which, with notice or lapse of time or both, would become a default under) or conflict with, or give rise to any right of termination, cancellation or acceleration of, any agreement, arrangement or instrument, whether written or oral, by which the Company or any of its assets are bound (c) violate or conflict with any of the provisions of the Company’s Organizational Documents or (d) result in any encumbrance upon any of the Shares, other than restrictions pursuant to the Investor Agreement or securities Laws, or any of the properties or assets of the Company or any Subsidiary, except, in the case of subsections (a) and (b), as would not have a Material Adverse Effect.

4.7No Governmental Authority or Third-Party Consents

.  No consent, approval, authorization or other order of, or filing with, or notice to, any Governmental Authority or other Third Party is required to be obtained or made by the Company in connection with the authorization, execution and delivery by the Company of any of the Transaction Agreements or with the authorization, issue and sale by the Company of the Shares, except (i) such filings as may be required to be made with the Securities and Exchange Commission (the “SEC”) and with any state blue sky or securities regulatory authority, which filings shall be made in a timely manner in accordance with all applicable Laws, (ii) as required pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”) and (iii) if required, with respect to the Shares, the filing with The Nasdaq Stock Market LLC of, and the absence of unresolved issues with respect to, a Notification Form: Listing of Additional Shares (the “LAS”).

4.8Valid Issuance of Shares

.  When issued, sold and delivered at the Closing in accordance with the terms hereof for the Aggregate Purchase Price, the Shares shall be duly authorized, validly issued, fully paid and nonassessable, free from any liens, encumbrances or restrictions on transfer, including preemptive rights, rights of first refusal or other similar rights, other than as arising pursuant to the Transaction Agreements, as a result of any action by the Investor or under federal or state securities Laws.

4.9Litigation

.  Except as set forth in the Company SEC Documents filed prior to the date of this Agreement, there is no action, suit, proceeding or investigation pending (of which the Company has received notice or otherwise has knowledge) or, to the Company’s knowledge, threatened, against the Company or which the Company intends to initiate which has had or is reasonably likely to have a Material Adverse Effect.

4.10Licenses and Other Rights; Compliance with Laws

.  The Company has all franchises, permits, licenses and other rights and privileges (“Permits”) necessary to permit it to own its properties and to conduct its business as presently conducted and is in compliance thereunder, except where the failure to be in compliance does not and would not have a Material Adverse Effect.  The Company has not taken any action that would interfere with the Company’s ability to renew all such Permit(s), except where the failure to renew such Permit(s) would not have a Material Adverse Effect.  The Company is and has been in compliance with all Laws applicable to its business, properties and assets, and to the products and services sold by it, 

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except where the failure to be in compliance does not and would not have a Material Adverse Effect.

4.11Company SEC Documents; Financial Statements; Nasdaq Stock Market

.

(a)Since December 31, 2016, the Company has timely filed all required reports, schedules, forms, statements and other documents (including exhibits and all other information incorporated therein), and any required amendments to any of the foregoing, with the SEC (the “Company SEC Documents”).  As of their respective filing dates, each of the Company SEC Documents complied in all material respects with the requirements of the Securities Act of 1933, as amended (the “Securities Act”), and the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations of the SEC promulgated thereunder applicable to such Company SEC Documents, and no Company SEC Documents when filed, declared effective or mailed, as applicable, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

(b)The financial statements of the Company included in its Annual Report on Form 10-K for the fiscal year ended December 31, 2018 and in its quarterly reports on Form 10-Q for the quarterly periods ended September 30, 2018, June 30, 2018, and March 31, 2018 comply as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto, have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and fairly present in all material respects the financial position of the Company as of the dates thereof and the results of its operations and cash flows for the periods then ended.  Except (i) as set forth in the Company SEC Documents or (ii) for liabilities incurred in the ordinary course of business subsequent to the date of the most recent balance sheet contained in the Company SEC Documents, the Company has no liabilities, whether absolute or accrued, contingent or otherwise, other than those that would not, individually or in the aggregate, have a Material Adverse Effect.

(c)As of the date of this Agreement, the Common Stock is listed on The Nasdaq Global Select Market, and the Company has taken no action designed to, or which is likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act or delisting the Common Stock from The Nasdaq Global Select Market.  As of the date of this Agreement, the Company has not received any notification that, and has no knowledge that, the SEC or The Nasdaq Stock Market LLC is contemplating terminating such listing or registration.

4.12Absence of Certain Changes

.  Except as disclosed in the Company SEC Documents, since December 31, 2018, there has not occurred any event that has caused or would reasonably be expected to cause a Material Adverse Effect.

4.13Internal Controls; Disclosure Controls and Procedures

.  The Company maintains internal control over financial reporting as defined in Rule 13a-15(f) under the 

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Exchange Act.  The Company has implemented the “disclosure controls and procedures” (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) required in order for the Principal Executive Officer and Principal Financial Officer of the Company to engage in the review and evaluation process mandated by the Exchange Act, and is in compliance with such disclosure controls and procedures in all material respects.  Each of the Principal Executive Officer and the Principal Financial Officer of the Company (or each former Principal Executive Officer of the Company and each former Principal Financial Officer of the Company, as applicable) has made all certifications required by Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 with respect to all reports, schedules, forms, statements and other documents required to be filed by the Company with the SEC.

4.14Intellectual Property

.  The Intellectual Property that is owned by the Company is owned free from any liens or restrictions, and all of the Company’s material Intellectual Property Licenses are in full force and effect in accordance with their terms and are free of any liens or restrictions except (a) where the failure to be free from such liens or restrictions would not have a Material Adverse Effect or (b) as set forth in any such Intellectual Property License.  Except as set forth in the Company SEC Documents, there is no legal claim or demand of any Person pertaining to, or any proceeding which is pending (of which the Company has received notice or otherwise has knowledge) or, to the knowledge of the Company, threatened, (i) challenging the right of the Company in respect of any Company Intellectual Property, or (ii) that claims that any default exists under any Intellectual Property License, except, in the case of (i) and (ii) above, where any such claim, demand or proceeding would not have a Material Adverse Effect.

4.15Offering

.  Subject to the accuracy of the Investor’s representations set forth in Sections 5.5, 5.6, 5.7, 5.9 and 5.10, the offer, sale and issuance of the Shares to be issued in conformity with the terms of this Agreement constitute transactions which are exempt from the registration requirements of the Securities Act and from all applicable state registration or qualification requirements.  Neither the Company nor any Person acting on its behalf will take any action that would cause the loss of such exemption.

4.16No Integration

.  The Company has not, directly or through any agent, sold, offered for sale, solicited offers to buy or otherwise negotiated in respect of, any security (as defined in the Securities Act) which is or will be integrated with the Shares sold pursuant to this Agreement in a manner that would require the registration of the Shares under the Securities Act.

4.17Brokers’ or Finders’ Fees

.  No broker, finder, investment banker or other Person is entitled to any brokerage, finder’s or other fee or commission from the Company in connection with the transactions contemplated by the Transaction Agreements.

4.18Not Investment Company

.  The Company is not, and immediately after receipt of the Aggregate Purchase Price will not be, an “investment company” as defined in the Investment Company Act of 1940, as amended.

4.19Insurance

.  The Company is insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company is engaged and for an enterprise at a substantially similar 

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stage of lifecycle as the Company, including, but not limited to, directors and officers insurance coverage.  To the Company’s knowledge, it will be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business.

4.20No General Solicitation

.  Neither the Company nor any person acting on behalf of the Company has offered or sold any of the Shares by any form of general solicitation or general advertising.  The Company has not, directly or through any agent, sold, offered for sale, solicited offers to buy or otherwise negotiated in respect of, any security (as defined in the Securities Act) in a manner or under any circumstances that would require the registration of the Shares under the Securities Act (including, without limitation, by virtue of the integration of the offering of the Shares with any prior offering of Company shares).

4.21Foreign Corrupt Practices

.  Neither the Company, nor to the knowledge of the Company, any agent or other person acting on behalf of the Company, has: (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company (or made by any person acting on its behalf of which the Company is aware) which is in violation of Law or (iv) violated in any material respect any provision of the Foreign Corrupt Practices Act of 1977, as amended, or any applicable non-U.S. anti-bribery Law.

4.22Regulation M Compliance

.  The Company has not taken, directly or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of any of the Shares.

4.23Office of Foreign Assets Control

.  Neither the Company nor, to the Company's knowledge, any director, officer, agent, employee or Affiliate of the Company is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department.

4.24U.S. Real Property Holding Corporation

.  The Company is not and has never been a U.S. real property holding corporation within the meaning of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon Investor’s request.

5.Representations and Warranties of the Investor

.  The Investor hereby represents and warrants to the Company, that:

5.1Organization; Good Standing

.  The Investor is a corporation duly organized, validly existing and in good standing under the laws of the State of New York.  The Investor has or will have all requisite power and authority to enter into the Transaction Agreements, to purchase the Shares and to perform its obligations under and to carry out the other transactions contemplated by the Transaction Agreements.

5.2Authorization

.  All requisite action on the part of the Investor and its directors and stockholders, required by applicable Law for the authorization, execution and 

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delivery by the Investor of the Transaction Agreements and the performance of all of its obligations thereunder, including the subscription for and purchase of the Shares, has been taken.  Each of this Agreement and the Investor Agreement has been duly executed and delivered by the Investor and upon the due execution and delivery thereof by the Company, will constitute valid and legally binding obligations of the Investor, enforceable against the Investor in accordance with their respective terms (except as such enforceability may be limited by (a) applicable bankruptcy, insolvency, reorganization, moratorium or other Laws of general application relating to or affecting enforcement of creditors’ rights and (b) rules of Law governing specific performance, injunctive relief or other equitable remedies and limitations of public policy).

5.3No Conflicts

.  The execution, delivery and performance of the Transaction Agreements and compliance with the provisions thereof by the Investor do not and shall not: (a) violate any provision of applicable Law or any ruling, writ, injunction, order, permit, judgment or decree of any Governmental Authority, (b) constitute a breach of, or default under (or an event which, with notice or lapse of time or both, would become a default under) or conflict with, or give rise to any right of termination, cancellation or acceleration of, any agreement, arrangement or instrument, whether written or oral, by which the Investor or any of its assets, are bound, or (c) violate or conflict with any of the provisions of the Investor’s organizational documents (including any articles or memoranda of organization or association, charter, bylaws or similar documents), except as would not impair or adversely affect the ability of the Investor to consummate the Transactions and perform its obligations under the Transaction Agreements and except, in the case of subsections (a) and (b), as would not have a Material Adverse Effect on the Investor.

5.4No Governmental Authority or Third-Party Consents

.  No consent, approval, authorization or other order of any Governmental Authority or other Third Party is required to be obtained by the Investor in connection with the authorization, execution and delivery of any of the Transaction Agreements or with the subscription for and purchase of the Shares, except as required pursuant to the HSR Act.

5.5Purchase Entirely for Own Account

.  The Shares shall be acquired for investment for the Investor’s own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and the Investor has no present intention of selling, granting any participation or otherwise distributing the Shares.  The Investor does not have and will not have as of the Closing any contract, undertaking, agreement or arrangement with any Person to sell, transfer or grant participation to a Person any of the Shares.

5.6Disclosure of Information

.  The Investor has received all the information from the Company and its management that the Investor considers necessary or appropriate for deciding whether to purchase the Shares hereunder.  The Investor further represents that it has had an opportunity to ask questions and receive answers from the Company regarding the Company, its financial condition, results of operations and prospects and the terms and conditions of the offering of the Shares sufficient to enable it to evaluate its investment.

5.7Investment Experience and Accredited Investor Status

.  The Investor is an “accredited investor” (as defined in Regulation D under the Securities Act).  The Investor has 

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such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in the Shares to be purchased hereunder.

5.8Acquiring Person

.  As of the date of this Agreement and immediately prior to the Closing, neither the Investor nor any of its Controlled Affiliates beneficially owns, or will beneficially own (as determined pursuant to Rule 13d-3 under the Exchange Act without regard for the number of days in which a Person has the right to acquire such beneficial ownership), any securities of the Company.

5.9Restricted Securities

.  The Investor understands that the Shares, when issued, shall be “restricted securities” under the federal securities Laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under such Laws the Shares may be resold without registration under the Securities Act only in certain limited circumstances.  The Investor represents that it is familiar with Rule 144 of the Securities Act, as presently in effect.

5.10Legends

.  The Investor understands that the Shares in book-entry form shall be subject to the following legends:

(a)“These securities have not been registered under the Securities Act of 1933.  They may not be sold, offered for sale, pledged or hypothecated in the absence of a registration statement in effect with respect to the securities under the Securities Act or an opinion of counsel (which counsel shall be reasonably satisfactory to Alnylam Pharmaceuticals, Inc.) that such registration is not required or unless sold pursuant to Rule 144 of the Securities Act.”; and

(b)“The securities represented by this certificate are subject to and shall be transferable only upon the terms and conditions of an Investor Agreement by and between Alnylam Pharmaceuticals, Inc. and Regeneron Pharmaceuticals, Inc., a copy of which is on file with the Secretary of Alnylam Pharmaceuticals, Inc.”

5.11Financial Assurances

.  As of the date hereof and as of the Closing Date, the Investor has and will have access to cash in an amount sufficient to pay to the Company the Aggregate Purchase Price.

6.Investor’s Conditions to Closing

.  The Investor’s obligation to purchase the Shares at the Closing is subject to the fulfillment as of the Closing of the following conditions (unless waived in writing by the Investor):

6.1Representations and Warranties

.  The representations and warranties made by the Company in Section 4 hereof shall be true and correct (i) as of the date of this Agreement and (ii) as of the Closing Date as though made on and as of the Closing Date, except to the extent such representations and warranties are specifically made as of a particular date, in which case such representations and warranties shall be true and correct as of such date; provided, however, that for purposes of this Section 6.1, all such representations and warranties of the Company (other than Sections 4.1(a), 4.2, 4.3, 4.4, 4.8, 4.15, 4.16 and 4.20 of this Agreement) shall be deemed to be true and correct for purposes of this Section 6.1 unless the failure or failures of such representations and warranties to be so true and correct, without regard to any “material,” 

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“materiality” or “Material Adverse Effect” qualifiers set forth therein (other than any reference to “material” in Sections 4.11(a) and 4.11(b)), individually or in the aggregate, has had or would reasonably be expected to have a Material Adverse Effect; provided further, however, that the representations made by the Company in Section 4.2(a) shall be updated by the Company and delivered to the Investor prior to Closing such that the Section 4.2(a) shall be true and correct as of the Closing Date as though made on and as of the Closing Date.

6.2Covenants

.  All covenants and agreements contained in this Agreement to be performed or complied with by the Company on or prior to the Closing Date shall have been performed or complied with in all material respects.

6.3Investor Agreement

.  The Company shall have duly executed and delivered to the Investor the Investor Agreement, and there shall have been no termination of the Investor Agreement that, as of the Closing, is effective.

6.4Collaboration Agreement

.  The Company shall have duly executed and delivered to the Investor the Collaboration Agreement, and there shall have been no termination of the Collaboration Agreement that, as of the Closing, is effective.

6.5No Material Adverse Effect

.  From and after the date of this Agreement until the Closing Date, there shall have occurred no event that has caused or would reasonably be expected to cause a Material Adverse Effect.

6.6Restated Certificate or Certificate of Designations

.  If Shareholder Approval is obtained prior to the date that the conditions to Closing set forth in this Section 6, Section 7, and Section 8 have been satisfied or waived as provided herein and therein, the Company shall have filed a Certificate of Amendment to the Restated Certificate of Incorporation of the Company with the Secretary of State of the State of Delaware prior to the Closing to increase the number of authorized shares of Common Stock by at least the number of shares of Common Stock equal to the number of Shares of Common Stock issuable hereunder, which such Certificate of Amendment to the Restated Certificate of Incorporation shall continue to be in full force and effect as of the Closing. If Shareholder Approval is not obtained prior to the date that the conditions to Closing set forth in this Section 6, Section 7, and Section 8 have been satisfied or waived as provided herein and therein, the Company shall have filed the Certificate of Designations with the Secretary of State of the State of Delaware prior to the Closing, which such Certificate of Designations shall continue to be in full force and effect as of the Closing.

7.Company’s Conditions to Closing

.  The Company’s obligation to issue and sell the Shares at the Closing is subject to the fulfillment as of the Closing of the following conditions (unless waived in writing by the Company):

7.1Representations and Warranties

.  The representations and warranties made by the Investor in Section 5 hereof shall be true and correct as of the date of this Agreement and as of the Closing Date as though made on and as of the Closing Date, except to the extent such representations and warranties are specifically made as of a particular date, in which case such representations and warranties shall be true and correct as of such date.

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7.2Covenants

.  All covenants and agreements contained in this Agreement to be performed or complied with by the Investor on or prior to the Closing Date shall have been performed or complied with in all material respects.

7.3Investor Agreement

.  The Investor shall have duly executed and delivered to the Company the Investor Agreement, and there shall have been no termination of the Investor Agreement that, as of the Closing, is effective.

7.4Collaboration Agreement

.  The Investor shall have duly executed and delivered to the Company the Collaboration Agreement, and there shall have been no termination of the Collaboration Agreement that, as of the Closing, is effective.  

8.Mutual Conditions to Closing

.  The obligations of the Investor and the Company to consummate the Closing are subject to the fulfillment as of the Closing Date of the following conditions:

8.1HSR Act and Other Qualifications

.  The filings required under the HSR Act in connection with the Transaction Agreements, as applicable, shall have been made and the required waiting period shall have expired or been terminated as of the Closing Date, and all other authorizations, consents, waivers, permits, approvals, qualifications and registrations to be obtained or effected with any Governmental Authority, including, without limitation, necessary blue sky permits and qualifications required by any state for the offer and sale to the Investor of the Shares, shall have been obtained and shall be in effect as of the Closing Date.

8.2Injunctions

.  There shall be no Law, injunction (whether temporary, preliminary or permanent), judgment or ruling enacted, promulgated, issued, entered, amended or enforced by any Governmental Authority in effect enjoining, restraining, preventing or prohibiting the consummation of the transactions contemplated by any Transaction Agreement or making the consummation of the transactions contemplated by any Transaction Agreement illegal.

8.3Absence of Litigation

.  There shall be no action, suit, proceeding or investigation by a Governmental Authority pending or currently threatened in writing against the Company or the Investor that questions the validity of any of the Transaction Agreements, the right of the Company or the Investor to enter into any Transaction Agreement or to consummate the transactions contemplated hereby or thereby or which, if determined adversely, would impose substantial monetary damages on the Company or the Investor as a result of the consummation of the transactions contemplated by any Transaction Agreement.

8.4No Prohibition; Market Listing

.  (a) No provision of any applicable Law and no judgment, injunction (preliminary or permanent), order or decree that prohibits, makes illegal or enjoins the consummation of the Transaction shall be in effect; and (b) the Common Stock shall be eligible for listing on The Nasdaq Global Select Market.  

9.Termination

.

9.1Ability to Terminate

.  This Agreement may be terminated at any time prior to the Closing by:

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(a)mutual written consent of the Company and the Investor;

(b)either the Company or the Investor, upon written notice to the other, if any of the mutual conditions to the Closing set forth in Section 8 shall have become incapable of fulfillment by the Termination Date and shall not have been waived in writing by the other party; provided, however, that the right to terminate this Agreement under this Section 9.1(b) shall not be available to any party whose failure to fulfill any obligation under this Agreement has been the cause of, or resulted in, the failure to consummate the transactions contemplated hereby prior to the Termination Date;

(c)the Investor, if (i) any of the representations and warranties of the Company contained in Section 4 of this Agreement shall fail to be true and correct, (ii) there shall be a breach by the Company of any covenant of the Company in this Agreement that, in either case, (A) would result in the failure of a condition set forth in Sections 6 or 8, and (B) which is not curable or, if curable, is not cured on or prior to the twentieth (20th) day after written notice thereof is given by the Investor to the Company, or (iii) the Closing Date shall not have occurred by the Termination Date; or

(d)the Company, if (i) any of the representations and warranties of the Investor contained in Section 5 of this Agreement shall fail to be true and correct or (ii) there shall be a breach by the Investor of any covenant of the Investor in this Agreement that, in either case, (A) would result in the failure of a condition set forth in Section 7 or 8, and (B) which is not curable or, if curable, is not cured on or prior to the twentieth (20th) day after written notice thereof is given the Company to the Investor.

9.2Effect of Termination

.  In the event of the termination of this Agreement pursuant to Section 9.1 hereof, (a) this Agreement (except for this Section 9.2 and Section 11 hereof (other than Section 11.13), and any definitions set forth in this Agreement and used in such sections) shall forthwith become void and have no effect, without any liability on the part of any party hereto or its Affiliates, and (b) all filings, applications and other submissions made pursuant to this Agreement, to the extent practicable, shall be withdrawn from the agency or other Person to which they were made or appropriately amended to reflect the termination of the transactions contemplated hereby; provided, however, that nothing contained in this Section 9.2 shall relieve any party from liability for fraud or any intentional or willful breach of this Agreement.

10.Additional Covenants and Agreements

.

10.1Market Listing

.  From the date hereof through the Closing Date, Company shall use all reasonable efforts to (a) maintain the listing and trading of the Common Stock on The Nasdaq Global Select Market and (b) effect the listing of the Shares on The Nasdaq Global Select Market, including submitting the LAS to The Nasdaq Stock Market LLC, if required.

10.2Notification under the HSR Act

.  

(a)Filing.  The Investor and the Company shall use best efforts, as promptly as practicable, but in no event later than seven (7) Business Days following the execution and delivery of this Agreement, to file or cause to be filed with the United States 

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Federal Trade Commission (the “FTC”) and the United States Department of Justice (the “DOJ”), the notification and report form required for the transactions contemplated hereby and any supplemental information requested in connection therewith pursuant to the HSR Act, which forms shall specifically request early termination of the waiting period prescribed by the HSR Act.  Each of the Investor and the Company shall furnish to each other’s counsel such necessary information and reasonable assistance as the other may request in connection with its preparation of any filing or submission that is necessary under the HSR Act.  Each of the Investor and the Company shall be responsible for their own costs and expenses, and the Investor and the Company each shall pay one-half of the filing fee required under the HSR Act.    

(b)Clearance.  The Investor and the Company shall use reasonable best efforts to promptly obtain clearance under the HSR Act for the consummation of this Agreement.  The Investor and the Company each agree not to take any action that will have the effect of delaying, impairing, or impeding, the early termination or expiration of the applicable waiting period under the HSR Act for the transactions contemplated by this Agreement.  The Investor and the Company commit to instruct their respective counsel to cooperate with each other and use reasonable best efforts to facilitate and expedite the identification and resolution of any issues arising under the HSR Act and, consequently, the expiration or termination of the applicable HSR Act waiting period at the earliest practicable date.  Such reasonable best efforts and cooperation include, but are not limited to, counsel’s undertaking (a) to promptly inform the other party of any written or oral communication received from the DOJ or the FTC; (b) to respond as promptly as practicable to any request from the DOJ or FTC for information, documents or other materials in connection with a review of the transactions contemplated by this Agreement; (c) to provide to the other party, and permit the other party to review and comment in advance of submission, all proposed correspondence, filings, and written communications to the DOJ or FTC with respect to the transactions contemplated by this Agreement; and (d) not to participate in any substantive meeting or discussion with the DOJ or the FTC in respect of an investigation or inquiry concerning the transactions contemplated by this Agreement unless it consults with the other party in advance and, except as prohibited by applicable law or the DOJ or the FTC, gives the other party the opportunity to attend and participate therein.  The parties will consider in good faith the views of one another, in connection with any analyses, appearances, presentations, memoranda, briefs, arguments, opinions, and proposals made or submitted by or on behalf of any party to the DOJ or the FTC, except as may be prohibited by or restricted by law.

10.3Assistance and Cooperation

.  Prior to the Closing, upon the terms and subject to the conditions set forth in this Agreement, each of the parties agrees to use all reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, and to assist and cooperate with the other party in doing, all things necessary, proper or advisable to consummate and make effective, in the most expeditious manner practicable, the transactions contemplated by this Agreement, including using all reasonable efforts to: (a) cause the conditions precedent set forth in Sections 6, 7 and 8 to be satisfied (including, in the case of the Company, promptly notifying the Investor of any notice from the Nasdaq Stock Market LLC with respect to the LAS); (b) obtain all necessary actions or non-actions, waivers, consents, approvals, orders and authorizations from Governmental Authorities and make all necessary registrations, declarations and filings (including registrations, declarations and filings with 

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Governmental Authorities, if any); and (c) obtain all necessary consents, approvals or waivers from Third Parties.

10.4Effect of Waiver of Condition to Closing

.  In the event that, as of the Closing, the Investor provides written notice to the Company of its waiver of the condition regarding a Material Adverse Effect set forth in Section 6.5 of this Agreement, the Investor shall be deemed to have waived any right of recourse against the Company for, and agreed not to sue the Company in respect of, any and all events or inaccuracies in any representations or warranties of the Company (a) that, as of the Closing, have caused or would reasonably be expected to cause such Material Adverse Effect and (b) of which the Investor had notice in writing from the Company immediately prior to the Closing.

10.5Nasdaq Matters

. Prior to the Closing, the Company shall comply in all material respects with all listing, reporting, filing, and other obligations under the rules of Nasdaq.

10.6Integration

. The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in the Securities Act) that would be integrated with the offer or sale of the Shares to be issued to the Investor hereunder for purposes of the rules and regulations of any of the following markets or exchanges on which the Common Stock of the Company is listed or quoted for trading on the date in question: the Pink OTC Markets, the OTC Bulletin Board, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the NYSE American or the New York Stock Exchange. 

10.7Blue Sky Filings

.  The Company shall take such action as the Company shall reasonably determine is necessary in order to obtain an exemption for, or to qualify the Shares for, sale to the Investor at the Closing under applicable securities or “Blue Sky” laws of the states of the United States, and shall provide evidence of such actions promptly upon request of the Investor.

10.8Legend Removal

.  After the expiration of the Lock-up Term (as defined in the Investor Agreement), the Company shall cause the legends set forth in Section 5.10(a) and (b) to be removed from the Shares, no later than three (3) Business Days from receipt of a request from the Investor pursuant to this Section 10.8, if (i) the Shares have been resold under an effective registration statement under the Securities Act, (ii) the Shares have been or will be transferred in compliance with Rule 144 under the Securities Act, (iii) the Shares are eligible for resale pursuant to Rule 144(b)(1)(i) under the Securities Act without the requirement for the Company to be in compliance with the current public information required under Rule 144 under the Securities Act as to such Shares and without volume or manner-of-sale restrictions or (iv) the Investor shall have provided the Company with an opinion of counsel, reasonably satisfactory to the Company, stating that such securities may lawfully be transferred without registration under the Securities Act (assuming for this purpose that the Investor is not an affiliate of the Issuer).

10.9Annual Meeting

.  The Company agrees to use its reasonable best efforts to, at the next regularly scheduled annual meeting of stockholders of the Company, which annual meeting shall in no event occur later than May 10, 2019, obtain the Shareholder Approval.  If the Shareholder Approval is not obtained at the 2019 annual meeting of stockholders of the 

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Company, the Company shall use its commercially reasonable efforts to obtain the Shareholder Approval as soon as practicable thereafter.

11.Miscellaneous

.

11.1Governing Law; Submission to Jurisdiction

.  This Agreement shall be governed by and construed in accordance with the Laws of the State of Delaware, without regard to the conflict of laws principles thereof that would require the application of the Law of any other jurisdiction.  Any action brought, arising out of, or relating to this Agreement shall be brought in the Court of Chancery of the State of Delaware.  Each party hereby irrevocably submits to the exclusive jurisdiction of said Court in respect of any claim relating to the validity, interpretation and enforcement of this Agreement, and hereby waives, and agrees not to assert, as a defense in any action, suit or proceeding in which any such claim is made that it is not subject thereto or that such action, suit or proceeding may not be brought or is not maintainable in such courts, or that the venue thereof may not be appropriate or that this agreement may not be enforced in or by such courts.  The parties hereby consent to and grant the Court of Chancery of the State of Delaware jurisdiction over such parties and over the subject matter of any such claim and agree that mailing of process or other papers in connection with any such action, suit or proceeding in the manner provided in Section 11.3 or in such other manner as may be permitted by law, shall be valid and sufficient thereof.

11.2Waiver

.  Waiver by a party of a breach hereunder by the other party shall not be construed as a waiver of any subsequent breach of the same or any other provision.  No delay or omission by a party in exercising or availing itself of any right, power or privilege hereunder shall preclude the later exercise of any such right, power or privilege by such party.  No waiver shall be effective unless made in writing with specific reference to the relevant provision(s) of this Agreement and signed by a duly authorized representative of the party granting the waiver.

11.3Notices

.  All notices, instructions and other communications hereunder or in connection herewith shall be in writing, shall be sent to the address of the relevant party set forth on Exhibit B attached hereto and shall be (a) delivered personally, (b) sent by registered or certified mail, return receipt requested, postage prepaid, (c) sent via a reputable nationwide overnight courier service or (d) sent by electronic mail, with a confirmation copy to be sent by registered or certified mail, return receipt requested, postage prepaid.  Any such notice, instruction or communication shall be deemed to have been delivered upon receipt if delivered by hand, three (3) Business Days after it is sent by registered or certified mail, return receipt requested, postage prepaid, one (1) Business Day after it is sent via a reputable nationwide overnight courier service or when transmitted with electronic confirmation of receipt, if transmitted by electronic mail (if such transmission is made during regular business hours of the recipient on a Business Day; or otherwise, on the next Business Day following such transmission).  Either party may change its address by giving notice to the other party in the manner provided above.

11.4Entire Agreement

.  This Agreement, the Collaboration Agreement and the Investor Agreement contain the entire agreement among the parties with respect to the subject 

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matter hereof and thereof and supersede all prior and contemporaneous arrangements or understandings, whether written or oral, with respect hereto and thereto.

11.5Amendments

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

11.6Headings; Nouns and Pronouns; Section References

.  Headings in this Agreement are for convenience of reference only and shall not be considered in construing this Agreement.  Whenever the context may require, any pronouns used herein shall include the corresponding masculine, feminine or neuter forms, and the singular form of names and pronouns shall include the plural and vice-versa.  References in this Agreement to a section or subsection shall be deemed to refer to a section or subsection of this Agreement unless otherwise expressly stated.

11.7Severability

.  If, under applicable Laws, any provision hereof is invalid or unenforceable, or otherwise directly or indirectly affects the validity of any other material provision(s) of this Agreement in any jurisdiction (“Modified Clause”), then, it is mutually agreed that this Agreement shall endure and that the Modified Clause shall be enforced in such jurisdiction to the maximum extent permitted under applicable Laws in such jurisdiction; provided that the parties shall consult and use all reasonable efforts to agree upon, and hereby consent to, any valid and enforceable modification of this Agreement as may be necessary to avoid any unjust enrichment of either party and to match the intent of this Agreement as closely as possible, including the economic benefits and rights contemplated herein.

11.8Assignment

.  Neither this Agreement nor any of the rights or obligations hereunder may be assigned by either the Investor or the Company without (a) the prior written consent of the Company in the case of any assignment by the Investor or (b) the prior written consent of the Investor in the case of an assignment by the Company.

11.9Successors and Assigns

.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

11.10Counterparts

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

11.11Third Party Beneficiaries

.  None of the provisions of this Agreement shall be for the benefit of or enforceable by any Third Party, including any creditor of any party hereto, except with respect to a Permitted Transferee (as defined in the Investor Agreement).  No Third Party (other than a Permitted Transferee) shall obtain any right under any provision of this Agreement or shall by reason of any such provision make any claim in respect of any debt, liability or obligation (or otherwise) against any party hereto.

11.12No Strict Construction

.  This Agreement has been prepared jointly and will not be construed against either party.

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11.13Survival of Warranties

.  The representations and warranties of the Company and the Investor contained in this Agreement shall survive the Closing for eighteen (18) months, except for (a) the representations and warranties set forth in Sections 4.1, 4.2, 4.4, 4.5(a), 4.6(c), 4.8, 4.13, 4.14, 4.15, 4.16, 4.17, 5.1, 5.2, 5.5, 5.7, 5.8, 5.9 and 5.10, which shall survive the Closing and (b) the representation and warranty of the Investor in Section 5.11, which shall not survive the Closing.  The parties hereby acknowledge and agree that the rights of the parties hereunder are special, unique and of extraordinary character, and that if any party refuses or otherwise fails to act, or to cause its Affiliates to act, in accordance with the provisions of this Agreement, such refusal or failure would result in irreparable injury to the Company or the Investor as the case may be, the exact amount of which would be difficult to ascertain or estimate and the remedies at law for which would not be reasonable or adequate compensation.  Accordingly, if any party refuses or otherwise fails to act, or to cause its Affiliates to act, in accordance with the provisions of this Agreement, then, in addition to any other remedy which may be available to any damaged party at law or in equity, such damaged party will be entitled to seek specific performance and injunctive relief, without posting bond or other security, and without the necessity of proving actual or threatened damages, which remedy such damaged party will be entitled to seek in any court of competent jurisdiction.

11.14Remedies

.  The rights, powers and remedies of the parties under this Agreement are cumulative and not exclusive of any other right, power or remedy which such parties may have under any other agreement or Law.  No single or partial assertion or exercise of any right, power or remedy of a party hereunder shall preclude any other or further assertion or exercise thereof.

11.15Expenses

.  Each party shall pay its own fees and expenses in connection with the preparation, negotiation, execution and delivery of the Transaction Agreements.

(Signature Page Follows)

 

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

REGENERON PHARMACEUTICALS, INC.

 

 

	
 
	
By:
	
/s/ Nouhad Husseini

	
 
	
Name:
	
Nouhad Husseini

	
 
	
Title:
	
Vice President

 

Signature Page to Stock Purchase Agreement

 

 

 

ALNYLAM PHARMACEUTICALS, INC.

 

 

	
 
	
By:
	
/s/ John M. Maraganore, Ph.D.

	
 
	
Name:
	
John M. Maraganore, Ph.D.

	
 
	
Title:
	
Chief Executive Officer

 

 

Signature Page to Stock Purchase Agreement

 

 

EXHIBIT A

FORM OF CERTIFICATE OF DESIGNATIONS

 

A-1

 

 

EXHIBIT B

NOTICES

(a)If to the Investor:

Regeneron Pharmaceuticals, Inc.

777 Old Saw Mill River Road

Tarrytown, New York 10591

Attention: President & CEO

Copy: General Counsel

 

with a copy to:

Morgan, Lewis & Bockius LLP

One Federal Street

Boston, MA 02110

Attention: Alan Leeds, Esq.

Email: alan.leeds@morganlewis.com

Bryan Keighery, Esq.

Email: bryan.keighery@morganlewis.com

 

(b)If to the Company:

Alnylam Pharmaceuticals, Inc.

300 Third Street

Cambridge, Massachusetts 02142

Attention: Legal Department

 

with a copy to:

Goodwin Procter LLP
100 Northern Avenue
Boston, MA 02210
Attention: Mitchell S. Bloom, Esq.

Email: mbloom@goodwinlaw.com

Gregg L. Katz, Esq.

Email: gkatz@goodwinlaw.com

B-1

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