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Sample Business Contracts

Secured Promissory Note - Cubist Pharmaceuticals Inc. and Mark P. Carthy

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                            SECURED PROMISSORY NOTE

$80,000                                                 Boston, Massachusetts
                                                        May 19, 1997

    FOR VALUE RECEIVED, the undersigned, Mark P. Carthy (the "Maker"), by 
this Secured Promissory Note (this "Note"), absolutely and unconditionally 
promises to pay to the order of CUBIST PHARMACEUTICALS, INC., a Delaware 
corporation (the "Payee"), the aggregate principal amount of Eighty Thousand 
Dollars ($80,000) on May 18, 2000 (the "Maturity Date"), and to pay interest 
on the principal amount outstanding from time to time hereunder, from the 
date hereof through and including the date on which such principal amount is 
paid in full, at a rate of four percent (4%) per annum simple interest. 
Interest hereunder shall be due and payable on the first anniversary hereof 
and on the Maturity Date or any accelerated maturity hereof.

    The Maker shall have the right to prepay the unpaid principal amount of 
this Note in full at any time, or in part from time to time, without premium 
or prepayment penalty, provided that there is paid with each such principal 
prepayment all accrued and unpaid interest to the date of prepayment 
(calculated on the basis of a 365-day year for the actual number of days for 
which the same is due).

    All payments of interest and principal hereunder shall be made at the 
principal residence or business address of the holder hereof. All payments 
hereunder shall be applied first to any unpaid accrued interest, second to 
payment of all, if any, other amounts except principal due under or in 
respect of this Note, and third to repayment of principal.

    This Note is made and delivered by the Maker to the Payee pursuant to 
that certain letter agreement, dated as of the date hereof, among the Payee 
and the Maker, and is secured pursuant to the provisions of a certain Stock 
Pledge Agreement, dated of even date herewith, between the Maker and the 
Payee.

    Anything implied herein to the contrary notwithstanding, in the event 
that (1) the Maker shall fail to pay when due all or any portion of the 
principal of or interest on this Note, (2) the Maker shall make an assignment 
of the whole or a substantial part of his assets for the benefit of 
creditors, or (3) there shall be commenced by or against the Maker any 
proceeding under any bankruptcy, insolvency, readjustment of debt or similar 
law of any jurisdiction, (each event referred to in clauses (1) through (3) 
above being hereinafter referred to herein as an "Event of Default") then 
without notice to or demand upon the Maker the entire unpaid principal of 
this Note, and all interest accrued thereon, shall (if not already due and 
payable) immediately become and be due and payable to the order of the holder 
hereof.


<PAGE>

                                       -2-

    The Maker hereby, to the fullest extent permitted by applicable law: (a) 
waives presentment, demand, notice, protest, and all other demands and 
notices in connection with delivery, acceptance, performance, default, 
acceleration or enforcement of or under this Note; (b) assents to any 
extension or postponement of the time of payment or any other indulgence, and 
to any substitution, exchange or release of collateral; and (c) agrees to pay 
to the holder, on demand, all costs and expenses of collection, including, 
without limitation, reasonable attorneys' fees and legal expenses, incurred 
by the holder in enforcing this Note, whether or not litigation is commenced.

    No failure by the holder to exercise, or delay by the holder in 
exercising, any right or remedy hereunder shall operate as a waiver thereof, 
or of any other right or remedy, and no single or partial exercise of any 
right or remedy shall preclude any other or further exercise thereof or of 
any other right or remedy. Acceptance by the holder of any payment after the 
maturity of this Note has been accelerated shall not constitute a waiver of 
such acceleration.

    This Note shall take effect as an instrument under seal and shall be 
governed by and construed in accordance with the law of The Commonwealth of 
Massachusetts.

                                       /s/ Mark P. Carthy
                                       --------------------------------------
                                       Mark P. Carthy
                                       21 Stone Road
                                       Belmont, MA 02178


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.4
<SEQUENCE>5
<DESCRIPTION>EXHIBIT 10.4
<TEXT>

<PAGE>
                                                     

                             STOCK PLEDGE AGREEMENT

    This STOCK PLEDGE AGREEMENT (this "Agreement") is made as of this 19th 
day of May, 1997 by and between Mark P. Carthy (the "Pledgor"), and Cubist 
Pharmaceuticals, Inc. a Delaware corporation (the "Company").

    WHEREAS, the Company has granted the Pledgor an Incentive Stock Option to 
purchase 200,000 shares of the Company's Common Stock, $.001 par value per 
share (the "Common Stock") at an exercise price of $8.00 per share.
 
    WHEREAS, the Pledgor wishes to exercise the Option for purposes of 
purchasing from the Company 10,000 shares (the "Shares") of Common Stock, 
such purchase to be upon the terms and conditions set forth in that certain 
letter agreement, dated as of the date hereof, by and between the Company and 
the Pledgor (the "Letter Agreement");
 
    WHEREAS, the Company has agreed to sell the Shares to the Pledgor 
pursuant to the terms of the Letter Agreement;
 
    WHEREAS, the Letter Agreement provides that the Pledgor shall make 
payment of the aggregate purchase price for the Shares by delivering to the 
Company a promissory note, the principal amount of which shall be equal to 
such aggregate purchase price (the "Note"); and
 
    WHEREAS, it is a condition precedent to the Company's obligation to 
consummate the sale of the Shares to the Pledgor that the Pledgor shall have 
executed and delivered this Agreement.
 
    NOW, THEREFORE, in consideration of the premises contained herein and for 
other good and valuable consideration, the receipt and sufficiency of which 
are hereby acknowledged, the parties hereto hereby agree as follows:
 
    1. Pledge of Stock, etc. The Pledgor hereby pledges, assigns, grants a 
security interest in, and delivers to the Company, to secure the Obligations 
(as defined below), all of his right, title and interest in and to the Shares 
to be held by the Company subject to the terms and conditions hereinafter set 
forth. The certificates for such Shares, accompanied by stock powers or other 
appropriate instruments of assignment thereof duly executed in blank by the 
Pledgor, are being delivered to the Company contemporaneously herewith. The 
Pledgor also hereby pledges, assigns, grants a security interest in, and 
delivers to the Company, to secure the Obligations, all of his right, title 
and interest in and to any and all sums or other property (including, without 
limitation, any additional shares of the capital stock of the Company and any 
shares of the capital stock of any issuer) paid or distributed upon or with 
respect to any of the shares of the capital stock of the Company or any other 
issuer pledged hereunder from time to time, regardless of whether any such 
sums or other property are paid or distributed by dividend or redemption, 
upon liquidation or dissolution, or otherwise.

<PAGE>

    2. Definitions. The following terms shall have the following meanings:
 
         Event of Default shall have the meaning ascribed to such term in the 
    Note.
 
         Stock. The Shares, together with any additional shares of capital 
    stock of any issuer pledged to the Company from time to time pursuant to 
    Section1 hereof.
 
         Stock Collateral.  The property at any time pledged to the Company 
    hereunder (whether described herein or not) and all income therefrom, 
    increases therein and proceeds thereof, but excluding from the definition 
    of "Stock Collateral" any income, increases or proceeds received by the 
    Pledgor to the extent expressly permitted by Section6.
 
    3. Security for Obligations. This Agreement and the security interest in 
and pledge of the Stock Collateral hereunder are made with and granted to the 
Company as security for the payment and performance in full of all of the 
obligations of the Pledgor under the Note (all of such obligations being 
collectively referred to herein as the "Obligations").
 
    4. Liquidation, Recapitalization, etc. Any sums or other property 
(including, without limitation, any shares of the capital stock of any 
issuer, including the Company, or any securities exchangeable for or 
convertible into shares of such capital stock) paid or distributed upon or 
with respect to any of the Stock, whether by dividend or redemption or upon 
the liquidation or dissolution of the issuer thereof or otherwise, shall, 
except to the limited extent provided in Section6, be paid over and delivered 
to the Company to be held by the Company, pursuant to the terms of this 
Agreement, as security for the payment and performance in full of all of the 
Obligations. In the event that, pursuant to the recapitalization or 
reclassification of the capital of the issuer thereof or pursuant to the 
reorganization thereof, any distribution of capital shall be made on or in 
respect of any of the Stock or any property shall be distributed upon or with 
respect to any of the Stock, the property so distributed shall be delivered 
to the Company to be held by it as security for the Obligations. Except to 
the limited extent provided in Section6, all sums of money and property paid 
or distributed in respect of the Stock, whether as a dividend or upon such a 
liquidation, dissolution, recapitalization or reclassification or otherwise, 
that are received by the Pledgor shall, until paid or delivered to the 
Company, be held in trust for the Company as security for the payment and 
performance in full of all of the Obligations.
 
    5. Warranty of Title; Authority. The Pledgor hereby represents and 
warrants that: (a) the Pledgor has good and marketable title to the Shares, 
subject to no pledges, liens, security interests, charges, options, 
restrictions or other encumbrances except the pledge and security interest 
created by this Agreement, and except for any restrictions imposed by the 
Securities Act of 1933, as amended (the "Securities Act"), (b) the Pledgor 
has full power, authority and legal right to execute, deliver and perform its 
obligations under this Agreement and to pledge and grant a security interest 
in all of the Stock Collateral pursuant to this Agreement, and (c) the 
execution, delivery and performance of this Agreement by the Pledgor and the 
pledge of and grant of a security interest in the Stock Collateral hereunder 
do not contravene any law, rule or 

<PAGE>

regulation or any provision of the charter or by-laws of the issuer or 
issuers thereof or of any judgment, decree or order of any tribunal or of any 
agreement or instrument to which the Pledgor is a party or by which he or any 
of his property is bound or affected or constitute a default thereunder. The 
Pledgor further warrants that he will have good and marketable title to any 
and all Stock Collateral hereafter pledged to the Company hereunder, subject 
to no pledges, liens, security interests, charges, options, restrictions or 
other encumbrances except the pledge and security interest created by this 
Agreement, and except for any restrictions imposed by the Securities Act. The 
Pledgor covenants that he shall defend the Company's rights and security 
interest in such Stock Collateral against the claims and demands of any and 
all third parties. The Pledgor further covenants that he shall not enter into 
any agreement that conflicts with this Agreement.
 
    6. Dividends, Voting, etc., Prior to Maturity. So long as no Event of 
Default shall have occurred and be continuing, the Pledgor shall be entitled 
to receive all cash dividends paid in respect of the Stock, to vote the Stock 
and to give consents, waivers and ratifications in respect of the Stock; 
provided, however, that no vote shall be cast or consent, waiver or 
ratification given by the Pledgor if the effect thereof would impair any of 
the Stock Collateral. All such rights of the Pledgor to receive cash 
dividends shall cease in case an Event of Default shall have occurred and be 
continuing. All such rights of the Pledgor to vote and give consents, waivers 
and ratifications with respect to the Stock shall, at the Company's option, 
as evidenced by the Company's notifying the Pledgor of such election, cease 
in case an Event of Default shall have occurred and be continuing.
 
    7. Remedies.

          7.1. In General. If an Event of Default shall have occurred and be 
    continuing, the Company shall thereafter have the following rights and 
    remedies (to the extent permitted by applicable law) in addition to the 
    rights and remedies of a secured party under the Uniform Commercial Code 
    of Massachusetts, all such rights and remedies being cumulative, not 
    exclusive, and enforceable alternatively, successively or concurrently, 
    at such time or times as the Company deems expedient:
 
               (a) if the Company so elects and gives notice of such election 
        to the Pledgor, the Company may vote any or all shares of the Stock 
        (whether or not the same shall have been transferred into its name or 
        the name of its nominee or nominees) for any lawful purpose, 
        including, without limitation, if the Company so elects, for the 
        liquidation of the assets of the issuer thereof, and give all 
        consents, waivers and ratifications in respect of the Stock and 
        otherwise act with respect thereto as though it were the outright 
        owner thereof (the Pledgor hereby irrevocably constituting and 
        appointing the Company as his proxy and attorney-in-fact, with full 
        power of substitution, to do so);

<PAGE>

               (b) the Company may demand, sue for, collect or make any 
        compromise or settlement the Company deems suitable in respect of any 
        Stock Collateral;
 
               (c) the Company may sell, resell, assign and deliver, or 
        otherwise dispose of, any or all of the Stock Collateral, for cash or 
        credit or both and upon such terms, at such place or places, at such 
        time or times and to such entities or other persons as the Company 
        thinks expedient, all without demand for performance by the Pledgor 
        or any notice or advertisement whatsoever except as expressly 
        provided herein or as may otherwise be required by law; and
 
               (d) the Company may cause all or any part of the Stock held by 
        it to be transferred into its name or the name of its nominee or 
        nominees.

          7.2. Sale of Stock Collateral. In the event of any disposition of 
    the Stock Collateral as provided in clause (c) of Section7.1, the Company 
    shall give to the Pledgor at least five business days' prior written 
    notice of the time and place of any public sale of the Stock Collateral 
    or of the time after which any private sale or any other intended 
    disposition is to be made. The Pledgor hereby acknowledges that five 
    business days prior written notice of such sale or sales shall be 
    reasonable notice. The Company may enforce its rights hereafter without 
    any other notice and without compliance with any other condition 
    precedent now or hereunder imposed by statute, rule of law or otherwise 
    (all of which are hereby expressly waived by the Pledgor, to the fullest 
    extent permitted by law). The Company may buy any part or all of the 
    Stock Collateral at any public sale and if any part or all of the Stock 
    Collateral is of a type customarily sold in a recognized market or is of 
    the type which is the subject of widely-distributed standard price 
    quotations, the Company may buy at private sale and may make payments 
    thereof by any means. The Company may apply the cash proceeds actually 
    received from any sale or other disposition to the reasonable expenses of 
    retaking, holding, preparing for sale, selling and the like, to 
    reasonable attorneys' fees, travel and all other expenses which may be 
    incurred by the Company in attempting to collect the Obligations or to 
    enforce this Agreement or in the prosecution or defense of any action or 
    proceeding related to the subject matter of this Agreement, and then to 
    the Obligations in such order or preference as the Company may determine 
    after proper allowance for Obligations not then due. Only after such 
    applications, and after payment by the Company of any amount required by 
    Section9-504(1)(c) of the Uniform Commercial Code of the Commonwealth of 
    Massachusetts, need the Company account to the Pledgor for any surplus. 

          7.3. The Pledgor's Agreements, etc. The Pledgor further agrees to 
    do or cause to be done all such other acts and things as may be 
    reasonably necessary to make any sales of any portion or all of the Stock 
    pursuant to this Section7 valid and binding and in compliance with any 
    and all applicable laws (including, without limitation, the Securities 
    Act, the Securities Exchange Act of 1934, as amended, the rules and 
    regulations of the 

<PAGE>

    Securities and Exchange Commission applicable thereto and all applicable 
    state securities or "Blue Sky" laws), regulations, orders, writs, 
    injunctions, decrees or awards of any and all courts, arbitrators or 
    governmental instrumentalities, domestic or foreign, having jurisdiction 
    over any such sale or sales, all at the Pledgor's expense. The Pledgor 
    further agrees that a breach of any of the covenants contained in this 
    Section7 will cause irreparable injury to the Company, that the Company 
    has no adequate remedy at law in respect of such breach and, as a 
    consequence, agrees that each and every covenant contained in this 
    Section7 shall be specifically enforceable against the Pledgor and the 
    Pledgor hereby waives and agrees not to assert any defenses against an 
    action for specific performance of such covenants.
 
    8. Marshalling. The Company shall not be required to marshal any present 
or future security for (including, but not limited to, this Agreement and the 
Stock Collateral pledged hereunder), or guaranties of, the Obligations or any 
of them, or to resort to such security or guaranties in any particular order; 
and all of its rights hereunder and in respect to such security and 
guaranties shall be cumulative and in addition to all other rights, however 
existing or arising. To the extent that he lawfully may, the Pledgor hereby 
agrees that he will not invoke any law relating to the marshalling of 
collateral which might cause delay in or impede the enforcement of the 
Company's rights under this Agreement, and, to the extent that he lawfully 
may, the Pledgor hereby irrevocably waives the benefits of all such laws.
 
    9. Pledgor's Obligations Not Affected. To the extent permitted by law, 
the obligations of the Pledgor hereunder shall remain in full force and 
effect without regard to, and shall not be impaired by (a) any bankruptcy, 
insolvency, reorganization, arrangement, readjustment, composition, 
liquidation or the like of the Pledgor; (b) any exercise or nonexercise, or 
any waiver, by the Company of any right, remedy, power or privilege under or 
in respect of any of the Obligations or any security therefor (including this 
Agreement); (c) any amendment to or modification of any of the Obligations; 
(d) any amendment to or modification of any instrument (other than this 
Agreement) securing any of the Obligations; or (e) the taking of additional 
security for, or any guaranty of, any of the Obligations or the release or 
discharge or termination of any security or guaranty for any of the 
Obligations; whether or not the Pledgor shall have notice or knowledge of any 
of the foregoing.
 
    10. Transfer, etc., by the Pledgor. Without the prior written consent of 
the Company, the Pledgor will not sell, assign, transfer or otherwise dispose 
of, grant any option with respect to, or pledge or grant any security 
interest in or otherwise encumber or restrict any of the Stock Collateral or 
any interest therein, except for the pledge thereof and security interest 
therein provided for in this Agreement.
 
    11. Further Assurances. The Pledgor will do all such acts, and will 
furnish to the Company all such financing statements, certificates, legal 
opinions and other documents and will obtain all such governmental consents 
and corporate approvals and will do or cause to be done all such other things 
as the Company may reasonably request from time to time in order to give 

<PAGE>

full effect to this Agreement and to secure the rights of the Company 
hereunder, all without any cost or expense to the Company. If the Company so 
elects, a photocopy of this Agreement may at any time and from time to time 
be filed by the Company as a financing statement in any recording office in 
any jurisdiction.
 
    12. Company's Exoneration. Under no circumstances shall the Company be 
deemed to assume any responsibility for or obligation or duty with respect to 
any part or all of the Stock Collateral of any nature or kind or any matter 
or proceedings arising out of or relating thereto, other than (a) to exercise 
reasonable care in the physical custody of the Stock Collateral and (b) after 
an Event of Default shall have occurred and be continuing to act in a 
commercially reasonable manner. The Company shall not be required to take any 
action of any kind to collect, preserve or protect its or the Pledgor's 
rights in the Stock Collateral or against other parties thereto. The 
Company's prior recourse to any part or all of the Stock Collateral shall not 
constitute a condition of any demand, suit or proceeding for payment or 
collection of any of the Obligations.
 
    13. Overdue Amounts. Until paid, all amounts due and payable by the 
Pledgor hereunder shall be a debt secured by the Stock Collateral and shall 
bear, whether before or after judgment, interest at the rate of interest set 
forth in the Note.
 
    14. No Waiver, etc. No act, failure or delay by the Company shall 
constitute a waiver of its rights and remedies hereunder or otherwise. No 
single or partial waiver by the Company of any default or right or remedy 
that it may have shall operate as a waiver of any other default, right or 
remedy or of the same default, right or remedy on a future occasion. The 
Pledgor hereby waives presentment, notice of dishonor and protest of all 
instruments, included in or evidencing any of the Obligations or the Stock 
Collateral, and any and all other notices and demands whatsoever (except as 
expressly provided herein).
 
    15. Notices, etc. Any communication to be made hereunder shall (a) be 
made in writing, but unless otherwise stated, may be made by telex, facsimile 
transmission or letter, and (b) be made or delivered to the address of the 
party receiving notice which is identified with its signature below (unless 
such party has by five (5) days' written notice specified another address), 
and shall be deemed made or delivered, when dispatched, left at that address, 
or five (5) days after being mailed, postage prepaid, to such address.
 
    16. Termination. Upon final payment and performance in full of the 
Obligations, this Agreement shall terminate and the Company shall, at the 
Pledgor's request and expense, return such Stock Collateral in the possession 
or control of the Company as has not theretofore been disposed of pursuant to 
the provisions hereof, together with any moneys and other property at the 
time held by the Company hereunder.
 
<PAGE>

    17. Amendment. Neither this Agreement nor any term hereof may be amended, 
modified, waived, discharged or terminated except by a written instrument 
expressly referring to this Agreement and to the provisions so amended, 
modified, waived, discharged or terminated, and executed by the party to be 
charged.
 
    18. Successors and Assigns. This Agreement and all obligations of the 
Pledgor hereunder shall be binding upon the heirs, successors and assigns of 
the Pledgor, and shall, together with the rights and remedies of the Company 
hereunder, inure to the benefit of the Company, its successors in title and 
assigns.
 
    19. Governing Law; Consent to Jurisdiction. THIS AGREEMENT IS INTENDED TO 
TAKE EFFECT AS A SEALED INSTRUMENT AND SHALL BE GOVERNED BY, AND CONSTRUED IN 
ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS. To the 
fullest extent permitted by law, the Pledgor hereby absolutely and 
irrevocably consents and submits to the jurisdiction of the courts of the 
Commonwealth of Massachusetts and of any Federal court located in the said 
Commonwealth in connection with any actions or proceedings brought against 
the Pledgor by the Company arising out of or relating to this Agreement or 
any of the agreements or transactions contemplated hereby and hereby 
irrevocably agrees that all claims in respect of any such action or 
proceeding may be heard and determined in any such court. The Pledgor hereby 
waives any objection that it may now or hereafter have to the venue of any 
such suit or any such court or that such suit is brought in an inconvenient 
court.
 
    20. Waiver of Jury Trial. THE PLEDGOR WAIVES HIS RIGHT TO A JURY TRIAL 
WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION 
WITH THIS AGREEMENT, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THE PERFORMANCE 
OF ANY SUCH RIGHTS OR OBLIGATIONS. Except as prohibited by law, the Pledgor 
waives any right which he may have to claim or recover in any litigation 
referred to in the preceding sentence any special, exemplary, punitive or 
consequential damages or any damages other than, or in addition to, actual 
damages.
 
    21. Headings. The descriptive section headings have been inserted for 
convenience of reference only and do not define or limit the provisions 
hereof.
 
    22. Severability, etc. If any term of this Agreement shall be held to be 
invalid, illegal or unenforceable, the validity of all other terms hereof 
shall be in no way affected thereby, and this Agreement shall be construed 
and be enforceable as if such invalid, illegal or unenforceable term had not 
been included herein. The Pledgor acknowledges receipt of a copy of this 
Agreement.

<PAGE>

    IN WITNESS WHEREOF, intending to be legally bound, the Pledgor and the 
Company have caused this Agreement to be executed as of the date first above 
written.

                                       CUBIST PHARMACEUTICALS, INC.



                                       By: /s/ Scott M. Rocklage
                                           _____________________________
                                           Scott M. Rocklage, Ph.D.
                                           President and CEO


                                       Address: 24 Emily Street
                                                Cambridge, MA 02139


                                       PLEDGOR

                                       /s/ Mark P. Carthy
                                       _________________________________
                                       Mark P. Carthy


                                       Address: 21 Stone Road
                                                Belmont, MA 02178