Document:

Exhibit 10.24

PHASE
FORWARD INCORPORATED

2004 STOCK OPTION AND INCENTIVE PLAN

RESTRICTED STOCK UNIT
AWARD AGREEMENT

	
  Name of Grantee:

  	
   

  	
   

  	
   

  
	
  Number of Restricted Stock Units:

  	
   

  	
   

  	
   

  
	
  Grant Date:

  	
   

  	
   

  	
   

  

 

Phase Forward Incorporated
(the “Company”) has selected you to receive an award of Restricted Stock Units
identified above, subject to the terms set forth on Appendix A hereto
and the provisions of the Phase Forward Incorporated 2004 Stock Option and
Incentive Plan (the “Plan”) and the attached Statement of Terms and Conditions.

Please indicate your
acceptance of this Agreement by signing below and returning it promptly to the
Company, to the attention of Jackie Almeida.

	
  

  	
  PHASE FORWARD INCORPORATED

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Robert K. Weiler

  
	
   

  	
   

  	
  Chief Executive
  Officer

  

 

I hereby accept the award of
Restricted Stock Units and agree to the terms and conditions thereof as set
forth in the Plan and the attached Statement of Terms and Conditions.

	
  

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Grantee’s Signature

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Grantee’s Name and Address

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
				

 

 

Appendix A

1.             Vesting Schedule

	
  Percentage of Units Vested

  	
   

  	
  Vesting Date

  
	
  %

  	
   

  	
  Second
  Anniversary of Grant Date

  
	
   

  	
   

  	
   

  
	
  %

  	
   

  	
  Third Anniversary
  of Grant Date

  
	
   

  	
   

  	
   

  
	
  %

  	
   

  	
  Fourth
  Anniversary of Grant Date

  

 

2.             Acceleration Events

In the event of a Change in Control, the Restricted
Stock Units shall vest as follows:

·                  On the effective date of the Change in
Control, the number of units that vest shall be determined by multiplying the
number of Restricted Stock Units subject to the Award by the product of       %
and the number of full months that have elapsed since the Grant Date, reduced
by the units that have previously vested pursuant to the vesting schedule set
forth above.

·                  The remaining Restricted Stock Units shall
vest on each subsequent anniversary of the Grant Date through the fourth
anniversary, measured pro rata monthly from the effective date of Change in
Control over the number of months (rounded up) remaining between the date of
Change in Control and the fourth anniversary of the Grant Date.

 

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STATEMENT OF TERMS AND CONDITIONS

1.             Preamble.  This Statement contains the terms and
conditions of an award (“Award”) of Restricted Stock Units (“Restricted Stock
Units”) made to the Grantee identified in the Restricted Stock Unit Award
Agreement attached hereto pursuant to the Plan. 
Each Restricted Stock Unit represents the right to receive one share of
common stock of the Company (“Stock”) on the vesting date of that unit.

2.             Acceptance of Award.  The Grantee shall have no rights with respect
to this Award unless he/she shall have accepted this Award by signing and
delivering to the Company a copy of the Restricted Stock Unit Award Agreement within
30 days of the Grant Date indicated on such agreement.

3.             Restrictions and Conditions.

(a)           This Award may not be sold, assigned,
transferred, pledged or otherwise encumbered or disposed of by the Grantee
prior to vesting.

(b)           If the Grantee’s employment with the
Company and its Subsidiaries is voluntarily or involuntarily terminated for any
reason (including death) prior to vesting of Restricted Stock Units granted
herein, all Restricted Stock Units shall immediately and automatically be
forfeited and returned to the Company.

(c)           The Grantee shall not have any
stockholder rights, including voting or dividend rights, with respect to the
shares of Stock subject to the Award until the Grantee becomes a record holder
of those shares of Stock following their actual issuance pursuant to Section 6
of this Agreement

4.             Vesting of Restricted Stock
Units.

The
term “vest” as used in this Statement means the lapsing of the restrictions
that are described in this Statement with respect to the Restricted Stock Units.  The Restricted Stock Units shall vest in
accordance with the schedule set forth in Section 1 of Appendix A to the
Restricted Stock Unit Award Agreement so long as the Grantee remains an
employee of the Company or a Subsidiary on each vesting date.

Notwithstanding
the foregoing, the Grantee shall become vested in the Restricted Stock Units prior
to the vesting dates set forth in Section 1 of Appendix A to the Restricted
Stock Unit Award Agreement in certain circumstances as described in Section 2
of Appendix A.

5.             Dividend Equivalents.

(a)           If on any date the
Company shall pay any dividend on shares of Stock of the Company, the number of
Restricted Stock Units credited to the Grantee shall, as of such date, be
increased by an amount determined by the following formula:

 

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W = (X multiplied by Y) divided by Z, where:

W = the number of additional Restricted Stock Units to
be credited to the Grantee on such dividend payment date;

X = the aggregate number of Restricted Stock Units
credited to the Grantee as of the record date of the dividend;

Y = the cash dividend per share amount; and

Z = the Fair Market Value per share of Stock (as
determined under the Plan) on the dividend payment date.

(b)            In the case of a
dividend paid on Stock in the form of Stock, including without limitation a
distribution of Stock by reason of a stock dividend, stock split or otherwise,
the number of Restricted Stock Units credited to the Grantee shall be increased
by a number equal to the product of (i) the aggregate number of Restricted
Stock Units that have been awarded to the Grantee through the related dividend
record date, and (ii) the number of shares of Stock (including any fraction
thereof) payable as dividend on one share of Stock.  Any additional Restricted Stock Units shall
be subject to the vesting and restrictions of this Agreement in the same manner
and for so long as the Restricted Stock Units granted pursuant to this
Agreement to which they relate remain subject to such vesting and restrictions,
and shall be promptly forfeited to the Company if and when such Restricted
Stock Units are so forfeited.

6.             Receipt of Shares of Stock.

(a)           The Restricted Stock
Units in which the Grantee vests in accordance with the vesting schedule set
forth in Appendix A will be issuable in the form of shares of Stock immediately
upon vesting, subject to the collection of the minimum withholding taxes in
accordance with the mandatory share withholding provision of Section 9 of this
Agreement.

(b)           Once a stock
certificate (or electronic transfer) has been delivered to the Grantee in
respect of the Restricted Stock Units, the Grantee will be free to sell the
shares of Stock evidenced by such certificate (or electronic transfer), subject
to applicable requirements of federal and state securities law and the Company’s
insider trading policy.

7.             Definitions.  As used in this Agreement, the following
terms shall have the meanings set forth herein:

(a)           “Board” shall mean Board of
Directors of the Company.

(b)           “Change in Control” shall mean
the occurrence of any of the following events:

(i)            The Company is merged or consolidated or reorganized into
or with another corporation or other legal person, and as a result of such
merger, consolidation or reorganization less than fifty percent (50%) of the
combined voting power of the then-outstanding securities of such surviving,
resulting or reorganized corporation or person immediately after such
transaction is held in the aggregate by the 

 

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holders of the then-outstanding securities entitled
to vote generally in the election of directors of the Company (“Voting Stock”)
immediately prior to such transaction;

(ii)           The Company sells or otherwise transfers all or
substantially all of its assets to any other corporation or other legal person,
and as a result of such sale or transfer less than fifty percent (50%) of the
combined voting power of the then-outstanding securities of such corporation or
person immediately after such sale or transfer is held in the aggregate by the
holders of Voting Stock of the Company immediately prior to such sale or
transfer;

(iii)          Any corporation or other legal person, pursuant to a tender
offer, exchange offer, purchase of stock (whether in a market transaction or
otherwise) or other transaction or event acquires securities representing 30%
or more of the Voting Stock of the Company, or there is a report filed on
Schedule 13D or Schedule 14D-1 (or any successor schedule, form or report),
each as promulgated pursuant to the U.S. Securities Exchange Act of 1934, as
amended (the “Exchange Act”), disclosing that any “person” (as such term is
used in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act) has become
the “beneficial owner” (as such term is used in Rule 13d-3 under the Exchange
Act) of securities representing 30% or more of the Voting Stock of the Company;

(iv)          The Company files a report or proxy statement with the
Securities and Exchange Commission pursuant to the Exchange Act disclosing
under or in response to Form 8-K or Schedule 14A (or any successor schedule,
form or report or item therein) that a change in control of the Company has
occurred; or

(v)           If during any period of two consecutive years, individuals
who at the beginning of any such period constitute the Board cease for any
reason to constitute at least a majority thereof, unless the election, or the
nomination for election by the Company’s stockholders, of each director of the
Company first elected during such period was approved by a vote of at least a
majority of the directors then still in office who were directors of the Company
at the beginning of any such period;

provided, however, that a “Change in Control”
shall not be deemed to have occurred for purposes of this Agreement solely
because (1) the Company, (2) an entity in which the Company directly or
indirectly beneficially owns 50% or more of the Voting Stock, or (3) any
Company-sponsored employee stock ownership plan or any other employee benefit
plan of the Company, either files or becomes obligated to file a report or a
proxy statement under or in response to Schedule 13D, Schedule 14D-1, Form 8-K
or Schedule 14A (or any successor schedule, form or report) under the Exchange
Act, disclosing beneficial ownership by it of shares of Voting Stock or because
the Company reports that a change in control of the Company has occurred by
reason of such beneficial ownership.

Notwithstanding
the foregoing, a Change in Control shall not be deemed to have occurred if (A) the
Company is the surviving company in a transaction described in subparagraph 6(c)(i),
(B) a majority of the Board of Directors of the surviving company is comprised
of the members of the Board of the Company immediately prior to such
transaction and remains so for at least twelve (12) months thereafter, and (C) the
President and Chief Executive Officer of the surviving 

 

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company immediately after
the effective date of the transaction is the President and Chief Executive
Officer of the Company immediately prior to such transaction and remains so for
at least twelve (12) months thereafter or until his/her voluntary resignation,
if earlier.

(c)           “Successor” shall mean any
successor to the Company (whether direct or indirect, by Change in Control,
operation of law or otherwise), including but not limited to any successor
(whether direct or indirect, by Change in Control, operation of law or
otherwise) to, or ultimate parent entity of any successor to, the Company.

8.             Incorporation of Plan.  Notwithstanding anything herein to the
contrary, this Award shall be subject to and governed by all the terms and
conditions of the Plan.  Capitalized
terms in this Award shall have the meaning specified in the Plan, unless a
different meaning is specified herein.

9.             Tax Withholding.  The Company intends to meet its minimum tax
withholding obligation by withholding from shares of Stock to be issued to the
Grantee.

10.           No Obligation to Continue
Employment.  Neither the Company nor
any Subsidiary is obligated by or as a result of the Plan or this Award to
continue the Grantee in employment and neither the Plan nor this Award shall
interfere in any way with the right of the Company or any Subsidiary to
terminate the employment of the Grantee at any time.

11.           Notices.  Notices hereunder shall be mailed or
delivered to the Company at its principal place of business and shall be mailed
or delivered to the Grantee at the address on file with the Company or, in
either case, at such other address as one party may subsequently furnish to the
other party in writing.

12.           Successors and Assigns.  The Company will require its respective
assign and Successors to expressly assume this Award and to agree to perform
hereunder in the same manner and the same extent that the Company would be
required to perform if no such succession or assignment had taken place.  Regardless of whether such an agreement is executed,
this Award shall inure to the benefit of, and be binding upon, the Company’s
Successor and assigns and Grantee’s heirs, estates, legatees, executors,
administrators, and legal representatives.

 

 6Exhibit
4.7

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY
PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.  THIS NOTE IS A GLOBAL SECURITY
WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED
IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF.  THIS NOTE IS EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE
ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND, UNLESS AND
UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS
NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF
THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.

CUBIST
PHARMACEUTICALS, INC.

CUSIP No.: 229678 AC 1

2.25%
CONVERTIBLE SUBORDINATED NOTES DUE JUNE 15, 2013

Cubist Pharmaceuticals, Inc., a Delaware corporation
(the “Company”, which term shall include any successor corporation under the
Indenture referred to on the reverse hereof), promises to pay to Cede &
Co., or registered assigns, the principal sum of Three Hundred and Fifty Million
Dollars ($350,000,000) on June 15, 2013, or such greater or lesser amount as is
indicated on the Schedule of Exchanges of Notes on the other side of this Note.

	
  Interest Payment Dates:

  	
   

  	
  June 15 and December 15, commencing December 15,
  2006

  
	
   

  	
   

  	
   

  
	
  Record Dates:

  	
   

  	
  June 1 and December 1

  

 

This Note is convertible as specified on the other
side of this Note.  Additional provisions
of this Note are set forth on the other side of this Note.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the
Company has caused this instrument to be duly executed.

	
  

  	
  CUBIST PHARMACEUTICALS, INC.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David W. J. McGirr

  	
   

  
	
   

  	
  Name: 

  	
  David W. J. McGirr

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Chief Financial Officer and

  	
             

  	
   

  
	
   

  	
   

  	
  Senior Vice President

  	
   

  	
   

  

 

Attest:

 

	
  /s/ Christopher D. T.
  Guiffre

  	
   

  
	
  Name:
  Christopher D. T. Guiffre

  	
   

  
	
  Title: Senior
  Vice President, General Counsel and Secretary

  	
   

  

 

Dated:

TRUSTEE’S CERTIFICATE OF
AUTHENTICATION

This is one of the Securities referred to 

in the within-mentioned Indenture.

THE BANK OF NEW YORK TRUST

COMPANY, N.A., as Trustee

	
  /s/ Authorized Signatory

  
	
  Authorized Signatory

  

 

CUBIST
PHARMACEUTICALS, INC. 

2.25% CONVERTIBLE SENIOR NOTES DUE JUNE 15, 2013

1.             INTEREST

Cubist Pharmaceuticals, Inc., a Delaware corporation
(the “Company”, which term shall include any successor corporation under the
Indenture hereinafter referred to), promises to pay interest on the principal
amount of this Note at the rate of 2.25% per annum.  The Company shall pay interest semiannually
on June 15 and December 15 of each year, commencing on December 15, 2006.  Interest on the Notes shall accrue from the
most recent date to which interest has been paid or, if no interest has been
paid, from June 6, 2006; provided, however, that if there is not
an existing default in the payment of interest and if this Note is
authenticated between a record date referred to on the face hereof and the next
succeeding interest payment date, interest shall accrue from such interest
payment date.  Interest will be computed
on the basis of a 360-day year of twelve 30-day months.

2.             METHOD OF PAYMENT

The Company shall pay interest on this Note (except
defaulted interest) to the person who is the Holder of this Note at the close
of business on June 1 or December 1, as the case may be, next preceding the
related interest payment date.  The
Holder must surrender this Note to a Paying Agent to collect payment of
principal.  The Company will pay
principal and interest in money of the United States that at the time of
payment is legal tender for payment of public and private debts.  The Company may, however, pay principal and
interest in respect of any Certificated Security by check or wire payable in
such money; provided, however, that a Holder with an aggregate
principal amount in excess of $2,000,000 will be paid by wire transfer in
immediately available funds at the election of such Holder if such Holder has
provided wire transfer instructions to the Company and the Trustee at least 10
Business Days prior to the payment date.

3.             PAYING AGENT, REGISTRAR AND CONVERSION AGENT

Initially, The Bank of New York Trust Company, N.A., a
national banking association (the “Trustee”, which term shall include any
successor trustee under the Indenture hereinafter referred to), will act as
Paying Agent, Registrar and Conversion Agent. 
The Company may change any Paying Agent, Registrar or Conversion Agent
without notice to the Holder.  The
Company or any of its Subsidiaries may, subject to certain limitations set
forth in the Indenture, act as Paying Agent or Registrar.

4.             INDENTURE, LIMITATIONS

This Note is one of a duly authorized issue of Notes
of the Company designated as its 2.25% Convertible Subordinated Notes due June
15, 2013 (the “Notes”), issued under an Indenture, dated as of June 6, 2006
(together with any supplemental indentures thereto, the “Indenture”), between
the Company and the Trustee.  The terms
of this Note include those stated in the Indenture and those required by or
made part of the Indenture by reference to the Trust Indenture Act of 1939, as
amended, as in effect on the date of the Indenture.  This Note is subject 

to all such terms, and
the Holder of this Note is referred to the Indenture and said Act for a
statement of them.  The Notes are
unsecured obligations of the Company limited to $350,000,000 aggregate
principal amount (or such greater amount necessary to reflect the exercise by
the Underwriters of their option to purchase additional Notes in compliance
with the Underwriting Agreement), except that the Company at any time or from
time to time may, without the consent of any Holder, issue additional Notes
having the same terms as the Notes initially issued under the Indenture, and
entitled to all of the benefits of the Indenture.  The Indenture does not limit other debt of
the Company, secured or unsecured.

5.             OPTIONAL REDEMPTION

The Notes are subject to redemption, at the option of
the Company, on or after June 20, 2011, in whole or in part, but only if the
Closing Sale Price of the Common Stock for at least 20 Trading Days in the 30
consecutive Trading Day period ending on the date one day prior to the day the
Company gives a notice of redemption is greater than 150% of the Applicable
Conversion Price on the date of such notice, at a Redemption Price in cash
equal to 100% of the principal amount of the Notes to be redeemed together with
accrued and unpaid interest, if any, on the principal amount of the Notes
redeemed to the date of redemption.

No sinking fund is provided for the Notes.

6.             NOTICE OF REDEMPTION

Notice of redemption will be delivered at least 10
days but not more than 60 days before the Redemption Date to each Holder of
Notes to be redeemed at its registered address. 
Notes in denominations larger than $1,000 may be redeemed in part, but
only in whole multiples of $1,000.  On
and after the Redemption Date, subject to the deposit with the Paying Agent of
funds sufficient to pay the Redemption Price plus accrued interest, if any,
accrued to, but excluding, the Redemption Date, interest shall cease to accrue
on Notes or portions of them called for redemption.

7.                                       REPURCHASE
OF NOTES AT OPTION OF HOLDER UPON A FUNDAMENTAL CHANGE

Subject to the terms and conditions of the Indenture,
if a Fundamental Change occurs at any time prior to the Final Maturity Date,
each Holder will, upon receipt of the notice of the occurrence of a Fundamental
Change, have the right to require the Company to repurchase any or all of such
Holder’s Notes for cash in an amount equal to 100% of the principal amount of
the Notes to be repurchased plus accrued and unpaid interest, if any, to (but
not including) the Fundamental Change Repurchase Date, unless such Fundamental
Change Repurchase Date falls after an interest payment record date and on or
prior to the corresponding interest payment date, in which case the Fundamental
Change Repurchase Price will include the full amount of accrued and unpaid
interest payable on such interest payment date to the Holder of record at the
close of business on the corresponding interest payment record date.  Subject to Sections 3.8(b) of the Indenture,
on or before the 15th Business Day after the effective date of a
Fundamental Change, the Company will provide to all Holders of the Notes and
the Trustee and Paying Agent a notice of the occurrence of the Fundamental
Change and of the resulting repurchase right. 
To exercise 

the repurchase right, a
Holder must deliver a Repurchase Exercise Notice duly completed to the Paying
Agent as described in the Indenture.

Notwithstanding the foregoing, the Holders will not
have the right to require the Company to repurchase any Notes if a Fundamental
Change described in clause (b), (c) or (d) in the definition of Fundamental
Change occurs (and the Company will not be required to deliver the notice
described in Section 3.8(c) of the Indenture), if either:

(1)          
the Closing Sale Price for any five Trading Days within the period of 10
consecutive Trading Days ending immediately after the later of the effective
date of the Fundamental Change or the date of the public announcement of the
Fundamental Change, in the case of a Fundamental Change relating to an
acquisition of Capital Stock under clause (b) of the definition of Fundamental
Change, or the period of 10 consecutive Trading Days ending immediately before
the effective date of the Fundamental Change, in the case of a Fundamental
Change relating to a merger, consolidation, asset sale or otherwise under
clause (c) of the definition of Fundamental Change or a change in the Board of
Directors under clause (d) of the definition of Fundamental Change, equals or
exceeds 105% of the Applicable Conversion Price in effect on each of those five
Trading Days; or

(2)           at
least 90% of the consideration paid for the Common Stock (excluding cash
payments for fractional shares and cash payments made pursuant to dissenters’
or appraisal rights) in a merger or consolidation or a conveyance, sale,
transfer or lease otherwise constituting a Fundamental Change under clause (b)
and/or (c) of the definition of Fundamental Change consists of shares of common
stock traded on the New York Stock Exchange or another U.S. national securities
exchange or quoted on the Nasdaq Stock Market or another established automated
over-the-counter trading market in the United States (or will be so traded or
quoted immediately following the merger or consolidation) and, as a result of
the merger or consolidation, the Securities become convertible into shares of
such common stock.

Holders have the right to withdraw any Fundamental
Change repurchase notice, in whole or in part, by delivering to the Paying
Agent a written notice of withdrawal in accordance with the provisions of the
Indenture.

If cash sufficient to pay the Fundamental Change
Repurchase Price of all Notes or portions thereof to be purchased as of the
Fundamental Change Repurchase Date, has been deposited with the Paying Agent on
or prior to the Business Day following the Fundamental Change Repurchase Date,
all interest shall cease to accrue on such Notes (or portions thereof)
immediately after such Fundamental Change Repurchase Date and the Holder
thereof shall have no other rights as such other than the right to receive the
Fundamental Change Repurchase Price, upon surrender of such Notes.

8.             CONVERSION

A Holder of a Note may convert the principal amount of
such Note (or any portion thereof equal to $ 1,000 or any integral multiple of
$1,000 in excess thereof) into Common Stock at any time prior to the close of
business on the last Business Day prior to the Final Maturity Date, at the
Applicable Conversion Rate in effect on the Conversion Date; provided, however,

that, if such Note is
called for redemption or submitted or presented for purchase pursuant to Article
3 of the Indenture, such conversion right shall terminate at the close of
business on the Business Day immediately preceding the Redemption Date or
Fundamental Change Repurchase Date, as the case may be, for such Note or such
earlier date as the Holder presents such Note for redemption or for purchase
(unless the Company shall default in making the redemption payment or
Fundamental Change Repurchase Price payment when due, as the case may be, in
which case the conversion right shall terminate at the close of business on the
date such default is cured and such Note is redeemed or purchased, as the case
may be).

The Initial Conversion Rate means 32.4981 shares of
Common Stock per $1,000 principal amount of Notes, subject to adjustment under
certain circumstances as provided in the Indenture.

Upon surrender of Notes for conversion, the Company
will have the right to deliver, in lieu of shares of Common Stock, cash or a
combination of cash and shares of Common Stock in the amounts provided in
Section 4.2 of the Indenture.

No fractional shares will be issued upon conversion;
in lieu thereof, an amount will be paid in cash based upon the Closing Sale
Price of the Common Stock on the Trading Day immediately prior to the
Conversion Date.

To convert a Note, a Holder must (a) complete and
manually sign the conversion notice set forth below and deliver such notice to
a Conversion Agent, (b) surrender the Note to a Conversion Agent, (c) furnish
appropriate endorsements and transfer documents if required by a Registrar or a
Conversion Agent, and (d) pay any transfer or similar tax, if required.  Notes so surrendered for conversion (in whole
or in part) during the period from the close of business on any regular record
date to the opening of business on the next succeeding interest payment date
(excluding Notes or portions thereof called for redemption or subject to
purchase upon a Fundamental Change on a Redemption Date or Fundamental Change
Repurchase Date, as the case may be, during the period beginning at the close of
business on a regular record date and ending at the opening of business on the
first Business Day after the next succeeding interest payment date, or if such
interest payment date is not a Business Day, the second such Business Day)
shall also be accompanied by payment in funds acceptable to the Company of an
amount equal to the interest payable on such interest payment date on the
principal amount of such Note then being converted, and such interest shall be
payable to such registered Holder notwithstanding the conversion of such Note,
subject to the provisions of the Indenture relating to the payment of defaulted
interest by the Company.  If the Company
defaults in the payment of interest payable on such interest payment date, the
Company shall promptly repay such funds to such Holder.

A Note in respect of which a Holder had delivered a
Fundamental Change repurchase notice exercising the option of such Holder to
require the Company to purchase such Note may be converted only if the
Fundamental Change repurchase notice is withdrawn in accordance with the terms
of the Indenture.

9.             DENOMINATIONS, TRANSFER, EXCHANGE

The Notes are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000.  A Holder may register the transfer of or
exchange Notes in accordance with the Indenture.  The Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents and to
pay any taxes or other governmental charges that may be imposed in relation thereto
by law or permitted by the Indenture.

10.           PERSONS DEEMED OWNERS

The Holder of a Note may be treated as the owner of it
for all purposes.

11.           UNCLAIMED MONEY

The Trustee and each Paying Agent shall pay to the
Company upon request any money held by them for the payment of principal or
interest that remains unclaimed for two years after a right to such money has
matured.  After payment to the Company,
Holders entitled to money must look to the Company for payment as general
creditors unless an applicable abandoned property law designates another
person.

12.           AMENDMENT, SUPPLEMENT AND WAIVER

Subject to certain exceptions, the Indenture or the
Notes may be amended or supplemented with the consent of the Holders of at
least a majority in aggregate principal amount of the Notes then outstanding,
and an existing default or Event of Default and its consequence or compliance
with any provision of the Indenture or the Notes may be waived in a particular
instance with the consent of the Holders of a majority in aggregate principal
amount of the Notes then outstanding. 
Without the consent of or notice to any Holder, the Company and the
Trustee may amend or supplement the Indenture or the Notes to, among other
things, cure any ambiguity, defect or inconsistency or make any other change
that does not adversely affect the rights of any Holder.

13.           SUCCESSOR ENTITY

When a successor corporation assumes all the
obligations of its predecessor under the Notes and the Indenture in accordance
with the terms and conditions of the Indenture, the predecessor corporation
(except in certain circumstances specified in the Indenture) shall be released
from those obligations.

14.           DEFAULTS AND REMEDIES

Under the Indenture, an Event of Default includes: (i)
default for 30 days in payment of any interest on any Notes; (ii) default in
payment of any principal (including, without limitation, premium, if any) on
the Notes when due; (iii) failure by the Company for 60 days after notice to it
to comply with any of its other agreements contained in the Indenture or the
Notes; (iv) default in payment of the purchase price of any Note when due; (v)
the Company fails to provide a 

notice of a Fundamental
Change within 30 days after notice of failure to do so; (vi) default in the
payment of certain indebtedness of the Company or a Significant Subsidiary; and
(vii) certain events of bankruptcy, insolvency or reorganization of the Company
or any Significant Subsidiary.  If an
Event of Default (other than as a result of certain events of bankruptcy, insolvency
or reorganization of the Company) occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate principal amount of the Notes then
outstanding may declare all unpaid principal to the date of acceleration on the
Notes then outstanding to be due and payable immediately, all as and to the
extent provided in the Indenture.  If an
Event of Default occurs as a result of certain events of bankruptcy, insolvency
or reorganization of the Company, unpaid principal of the Notes then outstanding
shall become immediately due and payable without any declaration or other act
on the part of the Trustee or any Holder, all as and to the extent provided in
the Indenture.  Holders may not enforce
the Indenture or the Notes except as provided in the Indenture.  The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Notes.  Subject to certain limitations, Holders of a
majority in aggregate principal amount of the Notes then outstanding may direct
the Trustee in its exercise of any trust or power.  The Trustee may withhold from Holders notice
of any continuing default (except a default in payment of principal or
interest) if it determines that withholding notice is in their interests.  The Company is required to file periodic
reports with the Trustee as to the absence of default.

15.           TRUSTEE DEALINGS WITH THE COMPANY

The Bank of New York Trust Company, N.A., a national
banking association, the Trustee under the Indenture, in its individual or any
other capacity, may make loans to, accept deposits from and perform services
for the Company or an Affiliate of the Company, and may otherwise deal with the
Company or an Affiliate of the Company, as if it were not the Trustee.

16.           NO RECOURSE AGAINST OTHERS

No past, present or future director, officer,
employee, incorporator or stockholder of the Company, as such, shall have any
liability for any obligations of the Company under the Notes, the Indenture or
for any claim based on, in respect of, or by reason of, such obligations or
their creation.  The Holder of this Note
by accepting this Note waives and releases all such liability.  The waiver and release are part of the
consideration for the issuance of this Note.

17.           AUTHENTICATION

This Note shall not be valid until the Trustee or an
authenticating agent manually signs the certificate of authentication on the
other side of this Note.

18.           ABBREVIATIONS AND DEFINITIONS

Customary abbreviations may be used in the name of the
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=  tenants by the entireties), JT TEN (=
joint tenants with right of survivorship and not as tenants in common), CUST (=
Custodian) and UGMA (= Uniform Gifts to Minors Act).

All terms used in this Note but not specifically
defined herein are defined in the Indenture and are used herein as so defined.

19.           INDENTURE TO CONTROL; GOVERNING LAW

In the case of any conflict between the provisions of
this Note and the Indenture, the provisions of the Indenture shall control.

THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE INTERNAL LAW OF THE STATE OF NEW YORK WITHOUT GIVING
EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

The Company will furnish to any Holder, upon written
request and without charge, a copy of the Indenture.  Requests may be made to: Cubist
Pharmaceuticals, Inc., 65 Hayden Avenue, Lexington, MA 02421, Attention:
Investor Relations.

 

ASSIGNMENT
FORM

To assign this Note, fill in the form below:

I or we assign and
transfer this Note to:

 

	
  

  
	
  (Insert
  assignee’s social security or tax I.D. number)

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
  (Print or type
  assignee’s name, address and zip code)

  
	
  and irrevocably appoint

  
	
   

  
	
   

  
	
  agent to transfer this Note on the books of the
  Company. The agent may substitute another to act for him or her.

  

 

	
  Date:

  	
   

  	
   

  	
   

  	
  Your Signature:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (Sign exactly as your name appears on the 

  other side of this Note)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  * Signature guaranteed by:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
						

 

*                 The signature
must be guaranteed by an institution which is a member of one of the following
recognized signature guaranty programs: (i) the Securities Transfer Agent
Medallion Program (STAMP); (ii) the New York Stock Exchange Medallion Program
(MSP); (iii) the Stock Exchange Medallion Program (SEMP); or (iv) such other
guaranty program acceptable to the Trustee.

CONVERSION NOTICE

To convert this Note into Common Stock of the Company,
check the box:  ̈

To convert only part of this Note, state the principal
amount to be converted (must be $1,000 or a integral multiple of $1,000): $

If you want the stock certificate made out in another
person’s name, fill in the form below:

 

	
  

  
	
  (Insert
  assignee’s social security or tax I.D. number)

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
  (Print or type
  assignee’s name, address and zip code)

  

 

	
  Date:

  	
   

  	
   

  	
   

  	
  Your Signature:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (Sign exactly as your name appears on the 

  other side of this Note)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  * Signature guaranteed by:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
						

 

*                 The signature
must be guaranteed by an institution which is a member of one of the following
recognized signature guaranty programs: (i) the Securities Transfer Agent
Medallion Program (STAMP); (ii) the New York Stock Exchange Medallion Program
(MSP); (iii) the Stock Exchange Medallion Program (SEMP); or (iv) such other
guaranty program acceptable to the Trustee.

REPURCHASE EXERCISE NOTICE

UPON A FUNDAMENTAL CHANGE

To:          Cubist
Pharmaceuticals, Inc.

The undersigned
registered owner of this Note hereby irrevocably acknowledges receipt of a
notice from Cubist Pharmaceuticals, Inc. (the “Company”) as to the occurrence
of a Fundamental Change with respect to the Company and requests and instructs
the Company to redeem the entire principal amount of this Note, or the portion
thereof (which is $1,000 or an integral multiple thereof) below designated, in
accordance with the terms of the Indenture referred to in this Note at the
Fundamental Change Repurchase Price, together with accrued interest to, but
excluding, the Repurchase Date, to the registered Holder hereof.

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Signature(s)

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Signature(s) must be guaranteed by a qualified
  guarantor institution with membership in an approved signature guarantee
  program pursuant to Rule 17Ad-15 under the Securities Exchange Act of 1934.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Signature Guaranty

  

 

	
  Principal amount to be redeemed

  
	
  (in an integral multiple of $1,000, if less than
  all):

  
	
   

  
	
   

  

 

NOTICE: The signature to the foregoing Election must
correspond to the name as written upon the face of the Note in every
particular, without alteration or any change whatsoever.

SCHEDULE
OF EXCHANGES OF NOTES

The following exchanges, redemptions, repurchases or
conversions of a part of this Global Note have been made:

 

	
   

  Date of

  Exchange,

  Redemption,

  Repurchase or

  Conversion

  	
   

  	
  Amount
  of

  Decrease in

  Principal

  Amount

  of this 

  Global Note

  	
   

  	
  Amount
  of

  Increase in

  Principal

  Amount of this

  Global Note

  	
   

  	
  Principal
  Amount

  of this Global

  Note Following

  Such Decrease or

  Increase

  	
   

  	
  Signature
  of

  Authorized Signatory 

  of Securities 

  Custodian

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