Restricted Share Agreement, dated as of September 18, 2015, by and between Kiniksa Pharmaceuticals, Ltd. and Thomas Beetham
KINIKSA PHARMACEUTICALS, LTD.
Restricted Stock Agreement
AGREEMENT made this 18 day of September, 2015, between Kiniksa Pharmaceuticals, Ltd., a Bermuda exempted company (the "Company"), and Thomas Beetham (the "Founder").
For valuable consideration, receipt of which is acknowledged, the parties hereto agree as follows:
The Company shall allot and issue to the Founder, and the Founder shall subscribe for and shall purchase from the Company, subject to the terms and conditions set forth in this Agreement, 200,000 common shares (the "Shares") US$0.0001 par value, of the Company ("Common Stock"), at a purchase price ofUS$0.0001 per share. The aggregate purchase price for the Shares shall be paid by the Founder by check payable to the order of the Company or such other method as may be acceptable to the Company. Upon receipt by the Company of payment for the Shares, the Company shall issue to the Founder one or more certificates in the name of the Founder for that number of Shares purchased by the Founder. The Founder agrees that the Shares shall be subject to the purchase options set forth in Sections 2 and 5 of this Agreement and the restrictions on transfer set forth in Section 4 of this Agreement.
"Unvested Shares" means the total number of Shares multiplied by the Applicable Percentage at the time the Purchase Option becomes exercisable by the Company. The "Applicable Percentage" shall be (i) 100% during the period ending on the first anniversary of the Vesting Commencement Date (as defined below), (ii) 75% on the first anniversary of the Vesting Commencement Date, (iii) 75% less 2.0833% for each month of employment completed by the Founder with the Company from and after the first anniversary of the Vesting Commencement Date, and (iv) zero on or after the fourth anniversary of the Vesting Commencement Date. For purposes of this Agreement, "Vesting Commencement Date" shall mean August 1, 2015.
below) or (ii) by the Founder for Good Reason (as defined below), then the vesting schedule of the Shares shall be accelerated so that all then Unvested Shares shall immediately become free from the Purchase Option on the date of such termination.
|3.||Exercise of Purchase Option and Closing.|
|4.||Restrictions on Transfer.|
|5.||Right of First Refusal.|
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transferee and state the number of such Shares the Founder proposes to transfer (the "Offered Shares"), the price per share and all other material terms and conditions of the transfer.
|(1)||a transfer of Shares to or for the benefit of any Approved|
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Relatives, or to a trust established solely for the benefit of the Founder and/or Approved Relatives;
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provided, however, that in the case of a transfer pursuant to clause (1) above, such Shares shall remain subject to this Agreement (including without limitation the restrictions on transfer set forth in Section 4 and the right of first refusal set forth in this Section 5) and such transferee shall, as a condition to such transfer, deliver to the Company a written instrument confirming that such transferee shall be bound by all of the terms and conditions of this Agreement.
The provisions of this Section 5 shall terminate upon the earlier of the
The Founder agrees, in connection with the initial underwritten public offering of the Common Stock pursuant to a registration statement under the Securities Act, (i) not to (a) offer, pledge, announce the intention to sell, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for shares of Common Stock or (b) enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership of shares of Common Stock, whether any transaction described in clause (a) or (b) is to be settled by delivery of shares of Common Stock or other securities, in cash or otherwise, during the period beginning on the date of the filing of such registration statement with the Securities and Exchange Commission and ending 180 days from the date of
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the final prospectus relating to the offering (plus up to an additional 34 days to the extent requested by the managing underwriters for such offering in order to address FINRA rules), and
(ii) to execute any agreement reflecting clause (i) above as may be requested by the Company or the managing underwriters at the time of such offering. The Company may impose stop-transfer instructions with respect to the shares of Common Stock or other securities subject to the foregoing restriction until the end of the "lock-up" period.
The Founder shall, upon the execution of this Agreement, execute Joint Escrow Instructions in the form attached to this Agreement as Exhibit A. The Joint Escrow Instructions shall be delivered to the Treasurer of the Company, as escrow agent thereunder. The Founder shall deliver to such escrow agent a stock assignment duly endorsed in blank, in the form attached to this Agreement as Exhibit B, and hereby instructs the Company to deliver to such escrow agent, on behalf of the Founder, the certificate(s) evidencing the Shares issued hereunder. Such materials shall be held by such escrow agent pursuant to the terms of such Joint Escrow Instructions.
All certificates representing Shares shall have affixed thereto legends in substantially the following form, in addition to any other legends that may be required under federal or state securities laws:
"The shares represented by this certificate are subject to restrictions on transfer and an option to purchase set forth in a certain Restricted Stock Agreement between the company and the registered owner of these shares (or his predecessor in interest), and such Agreement is available for inspection without charge at the office of the Treasurer of the company."
"The shares represented by this certificate have not been registered under the Securities Act of 1933, as amended, and may not be sold, transferred or otherwise disposed of in the absence of an effective registration statement under such Act or an opinion of counsel satisfactory to the company to the effect that such registration is not required."
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The Founder represents, warrants and covenants as follows:
(II) THE SHARES CANNOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THEY ARE SUBSEQUENTLY REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION FROM REGISTRATION IS THEN AVAILABLE; (III) IN ANY EVENT, THE EXEMPTION FROM REGISTRATION UNDER RULE 144 WILL NOT BE AVAILABLE FOR AT LEAST ONE YEAR AND EVEN THEN WILL NOT BE AVAILABLE UNLESS A PUBLIC MARKET THEN EXISTS FOR THE COMMON STOCK, ADEQUATE INFORMATION CONCERNING THE COMPANY IS THEN AVAILABLE TO THE PUBLIC, AND OTHER TERMS AND CONDITIONS OF RULE 144 ARE COMPLIED WITH; AND (IV) THERE IS NOW NO REGISTRATION STATEMENT ON FILE WITH
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THE SECURITIES AND EXCHANGE COMMISSION WITH RESPECT TO ANY STOCK OF THE COMPANY AND THE COMPANY HAS NO OBLIGATION OR CURRENT INTENTION TO REGISTER THE SHARES UNDER THE SECURITIES ACT.
|11.||Withholding Truces; Section 83(b) Election.|
THE FOUNDER ACKNOWLEDGES THAT IT IS SOLELY THE FOUNDER'S RESPONSIBILITY AND NOT THE COMPANY'S TO FILE TIMELY THE ELECTION UNDER SECTION 83(b), EVEN IF THE FOUNDER REQUESTS THE COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON THE FOUNDER'S BEHALF.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.
KINIKSA PHARMACEUTICALS, LTD.
By : /s/ Stephen Mahoney
Name: Stephen Mahony
Title: Sr. Vice President
2 Church Street
Hamilton HM 11 Bermuda
/s/ Thomas Beetham
Address:9 Starr Avenue East
Andover, MA O1810 USA
Joint Escrow Instructions September 18, 2015
Kiniksa Pharmaceuticals, Ltd. Clarendon House
2 Church Street
Hamilton HM 11 Bermuda
Attn: Treasurer Dear Sir/Madam:
As Escrow Agent for Kiniksa Pharmaceuticals, Ltd., a Bermuda exempted company, and its successors in interest under the Restricted Stock Agreement (the "Agreement") of even date herewith, to which a copy of these Joint Escrow Instructions is attached (the "Company"), and the undersigned person ("Holder"), you are hereby authorized and directed to hold the documents delivered to you pursuant to the terms of the Agreement in accordance with the following instructions:
|2.||Closing of Purchase.|
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evidencing the Shares to be transferred, to the Company against the simultaneous delivery to you of the purchase price for the Shares being purchased pursuant to the Agreement.
|4.||Duties of Escrow Agent.|
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G)The Company shall indemnify you and hold you harmless against any and all damages, losses, liabilities, costs, and expenses, including attorneys' fees and disbursements, (including without limitation the fees of counsel retained pursuant to Section 4(e) above, for anything done or omitted to be done by you as Escrow Agent in connection with this Agreement or the performance of your duties hereunder, except such as shall result from your gross negligence or willful misconduct.
Notices to the Company shall be sent to the address set forth in the salutation hereto, Attn: President
Kiniksa Pharmaceuticals Corp. 15 Walnut Street, Suite 200 Wellesley Hills, MA ###-###-#### USA
Notices to Holder shall be sent to the address set forth below Holder's signature below.
ESCROW AGENT:Notices to the Escrow Agent shall be sent
to the address set forth in the salutation hereto.
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Very truly yours,
Kiniksa Pharmaceuticals, Ltd.
By: _____/s/ Stephen Mahoney____________
Name: Stephen Mahoney
Title: Senior Vice President
___/s/ Thomas Beetham____________
Name: Thomas Beetham Address: 9 Starr Avenue East Andover, MA 01810 USA
Date Signed: September 18, 2015
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(INSTRUMENT OF TRANSFER SEPARATE FROM CERTIFICATE)
FOR VALUE RECEIVED, I hereby sell, assign and transfer unto _
shares of Common Stock, $0.0001 par value per share, of Kiniksa Pharmaceuticals, Ltd. (the "Company") standing in my name on the books of the Company represented by Certificate(s) Number
herewith, and do hereby irrevocably constitute and appoint _ attorney to transfer the said shares on the books of the Company with full power of substitution in the premises.
__/s/ Stephen Mahoney__________________
[Holder Print Signature]
[Holder Print Name]
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