CONTINGENT PAYMENT RIGHTS AGREEMENT
Exhibit 99.2
THIS CONTINGENT PAYMENT RIGHTS AGREEMENT, dated as of [ ], 2009 (this “Agreement”), is
entered into by and between The Medicines Company, a Delaware corporation (“Parent”), and American
Stock Transfer & Trust Company, a
[ ]
corporation, as Rights Agent (the “Rights
Agent”).
Preamble
Parent, Boxford Subsidiary Corporation, a Delaware corporation (“Purchaser”), and Targanta
Therapeutics Corporation, a Delaware corporation (“Company”), have entered into an Agreement and
Plan of Merger dated as of January 12, 2009 (as it may be amended or supplemented from time to time
pursuant to the terms thereof, the “Merger Agreement”), pursuant to which Purchaser (a) has made a
tender offer (the “Offer”) to acquire all of the outstanding shares of common stock, par value
$0.0001 per share, of Company (“Company Common Stock”) and (b) following acceptance of the Offer,
will merge with and into Company, with Company surviving the Merger as a subsidiary of Parent.
Pursuant to the Merger Agreement, in each of the Offer and the Merger, Parent has agreed to
provide to Company’s stockholders the right to receive contingent cash payments as hereinafter
described.
NOW, THEREFORE, for and in consideration of the premises and the consummation of the
transactions referred to above, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders (as hereinafter defined), as follows:
ARTICLE I
DEFINITIONS
DEFINITIONS
Section 1.1. Definitions.
(a) For all purposes of this Agreement, except as otherwise expressly provided or unless the
context otherwise requires:
(i) the terms defined in this Article have the meanings assigned to them in this Article, and
include the plural as well as the singular;
(ii) the words “herein,” “hereof” and “hereunder” and other words of similar import refer to
this Agreement as a whole and not to any particular Article, Section or other subdivision;
(iii) unless the context otherwise requires, words describing the singular number shall
include the plural and vice versa, words denoting any gender shall include all genders and words
denoting natural Persons shall include corporations, partnerships and other Persons and vice versa;
and
(iv) all references to “including” shall be deemed to mean including without limitation.
(b) Capitalized terms used but not otherwise defined herein shall have the meanings ascribed
thereto in the Merger Agreement. The following terms shall have the meanings ascribed to them
below:
“Board of Directors” means the board of directors of Parent.
“Board Resolution” means a copy of a resolution certified by the secretary or an assistant
secretary of Parent to have been duly adopted by the Board of Directors and to be in full force and
effect on the date of such certification, and delivered to the Rights Agent.
“Business Day” means any day other than a Saturday, Sunday or a day on which banking
institutions in New York, New York are authorized or obligated by law or executive order to remain
closed.
“cSSSI” means complicated skin and skin structure infections.
“CPRs” means the rights of Holders to receive contingent cash payments pursuant to Sections
1.1(a) and 3.1(a)(iii) of the Merger Agreement and this Agreement.
“CPR Payment Amounts” means the EMEA CPR Payment Amount, the FDA CPR Payment Amount, the
Single Dose CPR Payment Amount and the Net Sales CPR Payment Amount, as applicable.
“CPR Payment Date” means the date set forth in Section 2.4(i) on which a CPR Payment Amount is
to be paid by the Rights Agent to the Holders.
“DTC” means The Depository Trust Company.
“EMEA” means the European Medicines Agency.
“EMEA CPR Payment Amount” means an amount equal to (a) $1.00 per CPR, payable in cash, in the
event the EMEA CPR Payment Event occurs on or before December 31, 2009, (b) $0.75 per CPR, payable
in cash, in the event the EMEA CPR Payment Event occurs after December 31, 2009 and on or before
June 30, 2010 and (c) $0.50 per CPR, payable in cash, in the event the EMEA CPR Payment Event
occurs after June 30, 2010 and on or before December 31, 2013.
“EMEA CPR Payment Event” means EMEA approval of an MAA for Oritavancin for the treatment of
cSSSI granted to Parent or a Parent Affiliated Party, which approval is granted on or before
December 31, 2013.
“FDA CPR Payment Amount” means an amount equal to $0.50 per CPR, payable in cash.
“FDA CPR Payment Event” means final FDA approval of an NDA for Oritavancin for the treatment
of cSSSI granted to Parent or a Parent Affiliated Party, which approval is granted on or before the
Outside Payment Date.
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“Holder” means a Person in whose name a CPR is registered in the CPR Register.
“MAA” means a Marketing Authorization Application submitted to the EMEA.
“NDA” means a New Drug Application submitted to the FDA.
“Net Sales CPR Payment Amount” means an amount equal to $2.35 per CPR, payable in cash.
“Net Sales CPR Payment Event” means the first achievement of aggregate Net Sales of
Oritavancin in four consecutive calendar quarters of at least $400,000,000, all of which aggregate
Net Sales shall have occured on or before December 31, 2021.
“Net Sales” means the gross amount invoiced by or on behalf of the relevant Selling Entity for
Oritavancin sold to third parties other than the Company’s Affiliates, licensees or sublicensees in
bona fide, arm’s-length transactions, less the following deductions to the extent included in the
gross invoiced sales price of Oritavancin or otherwise directly paid or incurred by the Selling
Entity with respect to the sale of Oritavancin:
(1) normal and customary trade and quantity discounts actually allowed and properly
taken directly with respect to sales of Oritavancin;
(2) amounts repaid or credited by reasons of defects, recalls, returns, rebates or
allowances of goods or because of retroactive price reductions specifically identifiable to
Oritavancin;
(3) chargebacks, rebates (or the equivalent thereof) and other amounts paid on sale or
dispensing of Oritavancin, including such payments mandated by programs of Governmental Entities;
(4) rebates (or the equivalent thereof) and administrative fees paid to medical healthcare
organizations, to group purchasing organizations or to trade customers in line with approved
contract terms or other normal and customary understandings and arrangements;
(5) tariffs, duties, excise, sales, value-added and other taxes (other than taxes based on net
income) and charges of Governmental Entities;
(6) reasonable reserves made for uncollectible amounts on previously sold products;
(7) discounts pursuant to indigent patient programs and patient discount programs and coupon
discounts;
(8) transportation, freight, postage, importation, shipping insurance and other handling
expenses; and
(9) required distribution commissions and fees (including fees related to services provided
pursuant to distribution service agreements with wholesalers, fee-for-service wholesaler fees and
inventory management fees) payable to any third party providing distribution services to
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the Selling Entities, so long as such commissions and fees are consistent with the
distribution commissions and fees payable in respect to other branded prescription products
commercialized by the Company or the applicable Selling Entity;
all as determined in accordance with the Selling Entity’s usual and customary accounting
methods consistent with the treatment of other branded prescription products commercialized by the
applicable Selling Entity, which shall be in accordance with GAAP or International Financial
Reporting Standards. Further:
(A) In the case of any sale or other disposal of Oritavancin between or among the
Company, its Affiliates, licensees and sublicensees, for resale, Net Sales shall be calculated as
above only on the value charged or invoiced on the first arm’s-length sale thereafter to a third
party; and
(B) In the case of any sale or other disposal for value, such as barter or
counter-trade, of any product, or part thereof, other than in an arm’s-length transaction
exclusively for money and excluding any patient assistance programs, Net Sales shall be calculated
as above on the value of the non-cash consideration received or the fair market price (if higher)
of the Oritavancin in the country of sale or disposal.
“Non-Compliance Certificate” means each of an EMEA CPR Payment Non-Compliance Certificate, an
FDA CPR Payment Non-Compliance Certificate, a Single Dose CPR Payment Non-Compliance Certificate or
a Net Sales CPR Payment Non-Compliance Certificate.
“Officer’s Certificate” means a certificate signed by the chief executive officer, president,
chief financial officer, any vice president, the controller, the treasurer or the secretary, in
each case of Parent, in his or her capacity as such an officer, and delivered to the Rights Agent.
“Oritavancin” means any oral or intravenous formulation of a pharmaceutical product containing
as its sole active pharmaceutical ingredient the compound
22-0-(4-epi-vancosaminyl)-N3"-(4’-chloro[1,1’-biphenyl]—4-ylmethyl)-vancomycin.
“Outside Payment Date” means the date, on or before December 31, 2013, that is 40 months after
the date the first patient is enrolled in a Phase III Trial of cSSSI.
“Parent Affiliated Party” means an Affiliate of Parent, a successor or assign of Parent or an
Affiliate of Parent or a licensee or collaborator of Parent or any of the foregoing.
“Permitted Transfer” means: a transfer of CPRs (a) on death by will or intestacy; (b) pursuant
to a court order; (c) made by operation of law (including a consolidation or merger) or without
consideration in connection with the dissolution, liquidation or termination of any corporation,
limited liability company, partnership or other entity; (d) in the case of CPRs held in book-entry
or other similar nominee form, from a nominee to a beneficial owner, to the extent allowable by
DTC; or (e) as provided in Section 2.6.
“Phase III Trial” means a pivotal clinical study initiated by Parent or a Parent Affiliated
Party, in each case after the date hereof, of Oritavancin designed to confirm with statistical
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significance the efficacy and safety of Oritavancin for purposes of an application for
approval of an NDA for Oritavancin for the treatment of cSSSI.
“Rights Agent” means the Rights Agent named in the first paragraph of this Agreement, until a
successor Rights Agent shall have become such pursuant to the applicable provisions of this
Agreement, and thereafter “Rights Agent” shall mean such successor Rights Agent.
“Selling Entity” means the Company and each of its Affiliates, licensees and sublicensees.
“Single Dose CPR Payment Amount” means an amount equal to $0.70 per CPR, payable in cash.
“Single Dose CPR Payment Event” shall mean final FDA approval of an NDA for the use of
Oritavancin for the treatment of cSSSI administered by a single dose intravenous infusion granted
to Parent or a Parent Affiliated Party, which approval is granted on or before the Outside Payment
Date.
ARTICLE II
CONTINGENT PAYMENT RIGHTS
CONTINGENT PAYMENT RIGHTS
Section 2.1. CPRs.
The CPRs represent the right of Holders to receive contingent cash payments pursuant to
Sections 1.1(a) and 3.1(a)(iii) of the Merger Agreement and this Agreement. Each Holder shall be
entitled to one CPR for each share of Company Common Stock (a) the Purchaser accepts for payment
from such Holder pursuant to the Offer or (b) owned by such Holder immediately prior to the
Effective Time.
Section 2.2. Nontransferable.
The CPRs shall not be sold, assigned, transferred, pledged, encumbered or in any other manner
transferred or disposed of, in whole or in part, other than through a Permitted Transfer.
Section 2.3. No Certificate; Registration; Registration of Transfer; Change of Address.
(a) The CPRs shall not be evidenced by a certificate or other instrument.
(b) The Rights Agent shall keep a register (the “CPR Register”) for the purpose of
registering CPRs and transfers of CPRs as herein provided. The CPR Register will show one position
for Cede & Co representing all the shares of Company Common Stock held by DTC on behalf of the
street holders of the shares of Company Common Stock tendered by such holders in the Offer or held
by such holders as of immediately prior to the Effective Time. The Rights Agent will have no
responsibility whatsoever directly to the street holders with respect to transfers of CPRs unless
and until such CPRs are transferred into the name of such street holders in accordance with Section
2.2 of this Agreement. With respect to any payments to be made under Section 2.4 below, the Rights
Agent will accomplish the payment to any street holders of shares of Company Common Stock by
sending one lump payment to DTC. The Rights Agent
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will have no responsibilities whatsoever with regards to distribution of payments by DTC to
such street holders.
(c) Subject to the restrictions on transferability set forth in Section 2.2, every request
made to transfer a CPR must be in writing and accompanied by a written instrument of transfer in
form reasonably satisfactory to the Rights Agent, pursuant to Securities Transfer Association, Inc.
guidelines, duly executed by the Holder thereof, his attorney duly authorized in writing, personal
representative or survivor and setting forth in reasonable detail the circumstances relating to the
transfer. Upon receipt of such written notice, the Rights Agent shall, subject to its reasonable
determination that the transfer instrument is in proper form and the transfer otherwise complies
with the other terms and conditions herein (including the provisions of Section 2.2), register the
transfer of the CPRs in the CPR Register. All duly transferred CPRs registered in the CPR Register
shall be the valid obligations of Parent, evidencing the same right, and shall entitle the
transferee to the same benefits and rights under this Agreement, as those held by the transferor.
No transfer of a CPR shall be valid until registered in the CPR Register, and any transfer not duly
registered in the CPR Register will be void ab initio. Any transfer or assignment of the CPRs shall
be without charge (other than the cost of any transfer tax) to the Holder.
(d) A Holder may make a written request to the Rights Agent to change such Holder’s address
of record in the CPR Register. The written request must be duly executed by the Holder. Upon
receipt of such written notice, the Rights Agent shall promptly record the change of address in the
CPR Register.
Section 2.4. Payment Procedures.
(a) If the EMEA CPR Payment Event shall occur, then within 30 days following the occurrence
of the EMEA CPR Payment Event Parent shall deliver to the Rights Agent (i) a certificate (the “EMEA
CPR Payment Compliance Certificate”) certifying the date of the satisfaction of the EMEA CPR
Payment Event and that the Holders are entitled to receive the applicable EMEA CPR Payment Amount
set forth in such certificate and (ii) the aggregate amount of the EMEA CPR Payment payable to the
Holders.
(b) If the FDA CPR Payment Event shall occur, then within 30 days following the occurrence of
the FDA CPR Payment Event Parent shall deliver to the Rights Agent (i) a certificate (the “FDA CPR
Payment Compliance Certificate”) certifying the date of the satisfaction of the FDA CPR Payment
Event and that the Holders are entitled to receive the FDA CPR Payment Amount and (ii) the
aggregate amount of the FDA CPR Payment payable to the Holders.
(c) If the Single Dose CPR Payment Event shall occur, then within 30 days following the
occurrence of the Single Dose CPR Payment Event Parent shall deliver to the Rights Agent (i) a
certificate (the “Single Dose CPR Payment Compliance Certificate”) certifying the date of the
satisfaction of the Single Dose CPR Payment Event and that the Holders are entitled to receive the
Single Dose CPR Payment Amount and (ii) the aggregate amount of the Single Dose CPR Payment payable
to the Holders. Parent and the Rights Agent agree that the FDA CPR Payment Event and the Single
Dose CPR Payment Event may occur simultaneously, in which case both the FDA CPR Payment and the
Single Dose CPR Payment shall be payable simultaneously.
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(d) If the Net Sales CPR Payment Event shall occur, then within 30 days following the
occurrence of the Net Sales CPR Payment Event Parent shall deliver to the Rights Agent (i) a
certificate (the “Net Sales CPR Payment Compliance Certificate”) certifying the date of the
satisfaction of the Net Sales CPR Payment Event and that the Holders are entitled to receive the
Net Sales CPR Payment Amount and (ii) the aggregate amount of the Net Sales CPR Payment payable to
the Holders. For the avoidance of doubt, the Net Sales CPR Payment Amount shall be due and
payable by Parent on no more than one occasion.
(e) If the EMEA CPR Payment Event has not occurred on or before December 31, 2013, then on or
before January 31, 2014 Parent shall deliver to the Rights Agent a certificate (the “EMEA CPR
Payment Non-Compliance Certificate”) certifying that the EMEA CPR Payment Event has not occurred,
and as a result the Holders are not entitled to receive the EMEA CPR Payment Amount.
(f) If the FDA CPR Payment Event has not occurred on or before the Outside Payment Date, then
on or before the date that is 30 days after the Outside Payment Date Parent shall deliver to the
Rights Agent a certificate (the “FDA CPR Payment Non-Compliance Certificate”) certifying that the
FDA CPR Payment Event has not occurred, and as a result the Holders are not entitled to receive the
FDA CPR Payment Amount.
(g) If the Single Dose CPR Payment Event has not occurred on or before the Outside Payment
Date, then on or before the date that is 30 days after the Outside Payment Date Parent shall
deliver to the Rights Agent a certificate (the “Single Dose CPR Payment Non-Compliance
Certificate”) certifying that the Single Dose CPR Payment Event has not occurred, and as a result
the Holders are not entitled to receive the Single Dose CPR Payment Amount.
(h) If the Net Sales CPR Payment Event has not occurred on or before December 31, 2021, then
on or before March 1, 2022 Parent shall deliver to the Rights Agent a certificate (the “Net Sales
CPR Payment Non-Compliance Certificate”) certifying that the Net Sales CPR Payment Event has not
occurred, and as a result the Holders are not entitled to receive the Net Sales CPR Payment Amount.
(i) The Rights Agent shall, within ten Business Days of receipt, send each Holder at its
registered address a copy of each certificate delivered by Parent pursuant to this Section 2.4. If
in any such certificate Parent certifies that a CPR Payment Amount is payable to the Holders, then
at the time the Rights Agent sends a copy of such certificate to the Holders, the Right Agent shall
also pay the applicable CPR Payment Amount to each of the Holders (the amount to which each Holder
is entitled to receive will be based on the applicable CPR Payment Amount multiplied by the number
of CPRs held by such Holder as reflected on the CPR Register) by check mailed to the address of
each Holder as reflected in the CPR Register as of the close of business on the last Business Day
prior to such CPR Payment Date.
(j) Parent shall be entitled to deduct and withhold, or cause to be deducted or withheld,
from each CPR Payment Amount otherwise payable pursuant to this Agreement, such amounts as it is
required to deduct and withhold with respect to the making of such payment under the Code, or any
provision of state, local or foreign tax law. To the extent that amounts are so withheld and paid
over to or deposited with the relevant Governmental Entity, such withheld
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amounts shall be treated for all purposes of this Agreement as having been paid to the Holder
in respect of which such deduction and withholding was made. Prior to making any such tax
withholdings or causing any such tax withholdings to be made with respect to any Holder, the Rights
Agent shall, to the extent practicable, provide notice to the Holder of such potential withholding
and a reasonable opportunity for the Holder to provide any necessary tax forms (including an IRS
Form W-9 or an applicable IRS Form W-8) in order to avoid or reduce such withholding amounts.
(k) Parent agrees to treat, and to cause the Rights Agent to treat, all payments on the CPRs
as representing consideration for the sale of shares of Company Common Stock pursuant to the Merger
Agreement for all tax and tax reporting purposes, except to the extent that a portion of such
payments is required to be treated as imputed interest. Parent and the Rights Agent will determine
and report imputed interest amounts pursuant to Section 483 or 1274 of the Code. The CPRs shall
not be treated as an interest in a joint venture or partnership for tax purposes.
(l) Any portion of any CPR Payment Amount that remains undistributed to the Holders for six
months after any CPR Payment Date shall be delivered by the Rights Agent to Parent, upon demand,
and any Holder shall thereafter look only to Parent for payment of such CPR Payment Amount, but
shall have no greater rights against Parent than may be accorded to general unsecured creditors of
Parent under applicable law.
(m) Neither Parent nor the Rights Agent shall be liable to any person in respect of any CPR
Payment Amount delivered to a public official pursuant to any applicable abandoned property,
escheat or similar law. If any CPR Payment Amount has not been paid prior to two years after the
applicable CPR Payment Date (or immediately prior to such earlier date on which the CPR Payment
Amount would otherwise escheat to or become the property of any Governmental Entity), any such CPR
Payment Amount shall, to the extent permitted by applicable law, become the property of Parent,
free and clear of all claims or interest of any person previously entitled thereto.
Section 2.5. No Voting, Dividends Or Interest; No Equity Or Ownership Interest In Parent.
(a) The CPRs shall not have any voting or dividend rights, and interest shall not accrue on
any amounts payable on the CPRs to any Holder.
(b) The CPRs shall not represent any equity or ownership interest in Parent or in any
constituent company to the Merger.
Section 2.6. Ability To Abandon The CPR.
The Holder of a CPR may at any time at its option abandon all of its remaining rights in this
CPR by transferring the CPR to Parent without consideration therefor. Nothing in this Section 2.6
is intended to prohibit Parent from offering to acquire CPRs for consideration in its sole
discretion.
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ARTICLE III
THE RIGHTS AGENT
THE RIGHTS AGENT
Section 3.1. Certain Duties And Responsibilities.
The Rights Agent shall not have any liability for any actions taken or not taken in connection
with this Agreement, except to the extent of its willful misconduct, bad faith or gross negligence.
No provision of this Agreement shall require the Rights Agent to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties hereunder or in the
exercise of any of its rights or powers.
Section 3.2. Certain Rights of Rights Agent.
The Rights Agent undertakes to perform such duties and only such duties as are specifically
set forth in this Agreement, and no implied covenants or obligations shall be read into this
Agreement against the Rights Agent. In addition:
(a) the Rights Agent may rely and shall be protected in acting or refraining from acting upon
any resolution, certificate, statement, instrument, opinion, report, notice, request, direction,
consent, order or other paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) whenever the Rights Agent shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the Rights Agent may, in the absence
of bad faith, gross negligence or willful misconduct on its part, rely upon an Officer’s
Certificate;
(c) the Rights Agent may engage and consult with counsel of its selection and the written
advice of such counsel or any opinion of counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon;
(d) the permissive rights of the Rights Agent to do things enumerated in this Agreement shall
not be construed as a duty;
(e) the Rights Agent shall not be required to give any note or surety in respect of the
execution of such powers or otherwise in respect of the premises;
(f) Parent agrees to indemnify Rights Agent for, and hold Rights Agent harmless against, any
loss, liability, claim, demands, suits or expense arising out of or in connection with Rights
Agent’s duties under this Agreement, including the costs and expenses of defending Rights Agent
against any claims, charges, demands, suits or loss, unless such loss shall have been determined by
a court of competent jurisdiction to be a result of Rights Agent’s gross negligence, bad faith or
willful or intentional misconduct; and
(g) Parent agrees (i) to pay the fees and expenses of the Rights Agent in connection with
this Agreement as agreed upon in writing by Rights Agent and Parent on or prior to the date hereof,
and (ii) to reimburse the Rights Agent for all taxes and governmental charges, reasonable
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expenses and other charges of any kind and nature incurred by the Rights Agent in the
execution of this Agreement (other than taxes measured by the Rights Agent’s net income). The
Rights Agent shall also be entitled to reimbursement from Parent for all reasonable and necessary
out-of-pocket expenses paid or incurred by it in connection with the administration by the Rights
Agent of its duties hereunder.
Section 3.3. Resignation And Removal; Appointment of Successor.
(a) The Rights Agent may resign at any time by giving written notice thereof to Parent
specifying a date when such resignation shall take effect, which notice shall be sent at least 60
days prior to the date so specified. Parent shall have the right to remove Rights Agent at any
time by a Board Resolution specifying a date when such removal shall take effect. Notice of such
removal shall be given by Parent to Rights Agent, which notice shall be sent at least 60 days prior
to the date so specified.
(b) If the Rights Agent shall resign, be removed or become incapable of acting, Parent, by a
Board Resolution, shall promptly appoint a qualified successor Rights Agent who may be a Holder but
may not be an officer of Parent. The successor Rights Agent so appointed shall, forthwith upon its
acceptance of such appointment in accordance with this Section 3.3(b), become the successor Rights
Agent.
(c) Parent shall give notice of each resignation and each removal of a Rights Agent and each
appointment of a successor Rights Agent by mailing written notice of such event by first-class
mail, postage prepaid, to the Holders as their names and addresses appear in the CPR Register. Each
notice shall include the name and address of the successor Rights Agent. If Parent fails to send
such notice within ten days after acceptance of appointment by a successor Rights Agent, the
successor Rights Agent shall cause the notice to be mailed at the expense of Parent.
Section 3.4. Acceptance of Appointment By Successor.
Every successor Rights Agent appointed hereunder shall execute, acknowledge and deliver to
Parent and to the retiring Rights Agent an instrument accepting such appointment and a counterpart
of this Agreement, and thereupon such successor Rights Agent, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring
Rights Agent; but, on request of Parent or the successor Rights Agent, such retiring Rights Agent
shall execute and deliver an instrument transferring to such successor Rights Agent all the rights,
powers and trusts of the retiring Rights Agent.
ARTICLE IV
COVENANTS
COVENANTS
Section 4.1. List of Holders.
Parent shall furnish or cause to be furnished to the Rights Agent in such form as Parent
receives from the Company’s transfer agent (or other agent performing similar services for the
Company), the names and addresses of the Holders within ten Business Days of the Effective Time.
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Section 4.2. Payment of CPR Payment Amounts.
Parent shall duly and promptly deposit with the Rights Agent for payment to each Holder the
applicable CPR Payment Amounts, if any, in the manner provided for in Section 2.4 and in accordance
with the terms of this Agreement.
ARTICLE V
AMENDMENTS
AMENDMENTS
Section 5.1. Amendments Without Consent of Holders.
(a) Without the consent of any Holders or the Rights Agent, Parent, when authorized by a
Board Resolution, at any time and from time to time, may enter into one or more amendments hereto,
to evidence the succession of another Person to Parent and the assumption by any such successor of
the covenants of Parent herein as provided in Section 6.4.
(b) Without the consent of any Holders, Parent, when authorized by a Board Resolution, and
the Rights Agent, in the Rights Agent’s sole and absolute discretion, at any time and from time to
time, may enter into one or more amendments hereto, for any of the following purposes:
(i) to evidence the succession of another Person as a successor Rights Agent and the
assumption by any successor of the covenants and obligations of the Rights Agent herein;
(ii) to add to the covenants of Parent such further covenants, restrictions, conditions or
provisions as the Board of Directors and the Rights Agent shall consider to be for the protection
of the Holders; provided that, in each case, such provisions shall not materially adversely affect
the interests of the Holders;
(iii) to cure any ambiguity, to correct or supplement any provision herein that may be
defective or inconsistent with any other provision herein, or to make any other provisions with
respect to matters or questions arising under this Agreement; provided that, in each case, such
provisions shall not materially adversely affect the interests of the Holders;
(iv) as may be necessary or appropriate to ensure that the CPRs are not subject to
registration under the Securities Act or the Exchange Act; provided that such provisions shall not
materially adversely affect the interests of the Holders; or
(v) any other amendments hereto for the purpose of adding, eliminating or changing any
provisions of this Agreement, unless such addition, elimination or change is materially adverse to
the interests of the Holders.
(c) Promptly after the execution by Parent and the Rights Agent of any amendment pursuant to
the provisions of this Section 5.1, Parent shall mail (or cause the Rights Agent to mail) a notice
thereof by first class mail to the Holders at their addresses as they shall appear on the CPR
Register, setting forth in general terms the substance of such amendment.
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Section 5.2. Amendments With Consent of Holders.
(a) Subject to Section 5.1 (which amendments pursuant to Section 5.1 may be made without the
consent of the Holders), with the consent of the Holders of not less than a majority of the
outstanding CPRs, whether evidenced in writing or taken at a meeting of the Holders, Parent, when
authorized by a Board Resolution, and the Rights Agent may enter into one or more amendments hereto
for the purpose of adding, eliminating or changing any provisions of this Agreement, even if such
addition, elimination or change is materially adverse to the interest of the Holders.
(b) Promptly after the execution by Parent and the Rights Agent of any amendment pursuant to
the provisions of this Section 5.2, Parent shall mail (or cause the Rights Agent to mail) a notice
thereof by first class mail to the Holders at their addresses as they shall appear on the CPR
Register, setting forth in general terms the substance of such amendment.
Section 5.3. Execution of Amendments.
In executing any amendment permitted by this Article V, the Rights Agent shall be entitled to
receive, and shall be fully protected in relying upon, an opinion of counsel selected by Parent
stating that the execution of such amendment is authorized or permitted by this Agreement. The
Rights Agent may, but is not obligated to, enter into any such amendment that affects the Rights
Agent’s own rights, privileges, covenants or duties under this Agreement or otherwise.
Section 5.4. Effect of Amendments.
Upon the execution of any amendment under this Article V, this Agreement shall be modified in
accordance therewith, such amendment shall form a part of this Agreement for all purposes and every
Holder shall be bound thereby.
ARTICLE VI
OTHER PROVISIONS OF GENERAL APPLICATION
OTHER PROVISIONS OF GENERAL APPLICATION
Section 6.1. Notices To Rights Agent And Parent.
Any request, demand, authorization, direction, notice, consent, waiver or other document
provided or permitted by this Agreement shall be sufficient for every purpose hereunder if in
writing and sent by facsimile transmission, delivered personally, or by certified or registered
mail (return receipt requested and first-class postage prepaid) or sent by a nationally recognized
overnight courier (with proof of service), addressed as follows:
(a) if to the Rights Agent, addressed to it at [ ], or at any other address
previously furnished in writing to the Holders and Parent by the Rights Agent; or
(b) if to Parent, addressed to it at
[ ],
or at any other address
previously furnished in writing to the Rights Agent and the Holders by Parent, with a copy to
Xxxxxx Xxxxxx Xxxxxxxxx Xxxx and Xxxx LLP, 00 Xxxxx Xxxxxx, Xxxxxx, XX 00000, Attention: Xxxxx X.
Xxxxxxx, Esq. and Xxx X. Xxxxxxxxx, Esq.
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Section 6.2. Notice To Holders.
Where this Agreement provides for notice to Holders, such notice shall be sufficiently given
(unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid,
to each Holder affected by such event, at his, her or its address as it appears in the CPR
Register, not later than the latest date, and not earlier than the earliest date, prescribed for
the giving of such notice. In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder shall
affect the sufficiency of such notice with respect to other Holders.
Section 6.3. Effect of Headings.
The Article and Section headings herein are for convenience only and shall not affect the
construction hereof.
Section 6.4. Successors and Assigns.
All covenants and agreements in this Agreement by Parent shall bind its successors and
assigns, whether so expressed or not.
Section 6.5. Benefits of Agreement.
Nothing in this Agreement, express or implied, shall give to any Person (other than the
parties hereto, the Holders and their permitted successors and assigns hereunder) any benefit or
any legal or equitable right, remedy or claim under this Agreement or under any covenant or
provision herein contained, all such covenants and provisions being for the sole benefit of the
parties hereto, the Holders and their permitted successors and assigns.
Section 6.6. Governing Law.
This Agreement and the CPRs shall be governed by and construed in accordance with the laws of
the State of Delaware without regard to its rules of conflicts of laws.
Section 6.7. Legal Holidays.
In the event that a CPR Payment Date shall not be a Business Day, then, notwithstanding any
provision of this Agreement to the contrary, any payment required to be made in respect of the CPRs
on such date need not be made on such date, but may be made on the next succeeding Business Day
with the same force and effect as if made on the applicable CPR Payment Date.
Section 6.8. Severability Clause.
In case any one or more of the provisions contained in this Agreement shall for any reason be
held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of this Agreement, but this Agreement shall
be construed as if such invalid or illegal or unenforceable provision had never been contained
herein. Upon such determination that any term or other provision is invalid, illegal or
unenforceable, the court or other tribunal making such determination is authorized and instructed
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to modify this Agreement so as to effect the original intent of the parties as closely as
possible so that the transactions and agreements contemplated herein are consummated as originally
contemplated to the fullest extent possible.
Section 6.9. Counterparts.
This Agreement may be signed in any number of counterparts (which may be effectively delivered
by facsimile or other electronic means), each of which shall be deemed to constitute but one and
the same instrument.
Section 6.10. Termination.
This Agreement shall be terminated and of no force or effect, the parties hereto shall have no
liability hereunder, and no payments shall be required to be made, upon the earlier to occur of (a)
the payment of all potential CPR Payment Amounts required to be paid under the terms of this
Agreement and (b) the delivery of Non-Compliance Certificates relating to all CPR Payment Amounts
not previously paid pursuant to clause (a).
Section 6.11. Entire Agreement.
This Agreement and the Merger Agreement represent the entire understanding of the parties
hereto with reference to the transactions and matters contemplated hereby and thereby and this
Agreement supersedes any and all other oral or written agreements hereto made except for the Merger
Agreement. If and to the extent that any provision of this Agreement is inconsistent or conflicts
with the Merger Agreement, this Agreement shall govern and be controlling.
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed on its behalf
by its duly authorized officers as of the day and year first above written.
| THE MEDICINES COMPANY |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| AMERICAN STOCK TRANSFER & TRUST COMPANY |
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| By: | ||||
| Name: | ||||
| Title: | ||||
