|
Participant:
|
[NAME] (the “Participant”)
|
|
Company:
|
Immunovant, Inc., a Delaware corporation (the “Company”)
|
|
Plan:
|
Immunovant, Inc. 2019 Equity Incentive Plan (as amended, the “Plan”)
|
|
Notice:
|
The Participant has been granted an award of Capped Value Appreciation Rights (“CVARs”) in accordance with the terms of this Grant Notice (this “Grant Notice”), the Capped Value Appreciation Right Award Agreement attached hereto as Attachment A (the “CVAR Award Agreement” and, together with this Grant Notice, collectively, this “Agreement”) and the Plan. Unless otherwise defined, capitalized
terms used herein shall have the meanings ascribed to them in the Plan.
|
|
Type of Award:
|
A CVAR is an unfunded and unsecured conditional obligation of the Company that represents the right to receive the CVAR Amount (defined below), if any, applicable to the Participant’s award of CVARs, subject to the terms and conditions
of this Agreement and those of the Plan. A CVAR is an Other Stock Award for purposes of the Plan.
|
|
CVARs:
|
[#] CVARs
|
|
Grant Date:
|
[DATE] (the “Grant Date”)
|
|
Vesting
Commencement Date:
|
[DATE] (the “Vesting Commencement Date”)
|
|
Expiration Date:
|
[DATE] (the “Expiration Date”)
|
|
Hurdle Price:
|
$[●] per share of Common Stock (the “Hurdle Price”)
|
|
Cap Price:
|
$[●] per share of Common Stock (the “Cap Price”)
|
|
Knock-in Price:
|
$[●] per share of Common Stock (the “Knock-in Price”)
|
|
Vesting:
|
The CVARs will vest on the first date that each of (i) the “Service Requirement”, (ii) the “Performance Requirement”
and (iii) the “Knock-in Requirement” have been satisfied (collectively, the “Vesting
Requirements”). The portion of the CVARs that have satisfied all of the Vesting Requirements in accordance with this Agreement as of any relevant date of determination are referred to as the “Vested CVARs” and the date that all of the Vesting Requirements are satisfied with respect to any CVARs is referred to as the “Vesting Date” with
respect to such CVARs.
For purposes of this Agreement, “Continuous Service” shall be as defined in the Plan, and, for the sake of clarity, shall include the Participant’s continued employment or
service with Roivant Sciences Ltd. or one of its subsidiaries.
|
|
Service Requirement:
|
The Service Requirement applicable to the CVARs will be satisfied as follows, subject to the Participant’s Continuous Service through each of the dates set forth below (each a “Service
Vesting Date”): [●]
The CVARs that are scheduled to satisfy the Service Requirement on an applicable Service Vesting Date are collectively referred to herein as a “CVAR Tranche”.
|
|
Performance Requirement:
|
[●]
|
|
Knock-in Requirement:
|
The Knock-in Requirement applicable to any CVAR Tranche will be satisfied if, as of the relevant Service Vesting Date of such CVAR Tranche, the Fair Market Value of a share of Common Stock equals or exceeds the Knock-in Price. For the
sake of clarity, the Knock-in Requirement will apply on a CVAR Tranche-by-CVAR Tranche basis (and satisfaction of the Knock-in Requirement by one applicable CVAR Tranche (i.e., by virtue of the Fair Market Value of a share of Common
Stock being equal to or exceeding the Knock-in Price as of the Service Vesting Date applicable to such CVAR Tranche or a subsequent Knock-in Measurement Date) shall not constitute satisfaction of the Knock-in Requirement for any other
CVAR Tranche).
If the Fair Market Value of a share of Common Stock does not equal or exceed the Knock-in Price as of the relevant Service Vesting Date of a CVAR Tranche, then the CVAR Tranche that has otherwise satisfied the Service Requirement as of
such Service Vesting Date will be deemed to remain outstanding and will be “re-tested” and eligible to become Vested CVARs on a subsequent annual “Knock-in Measurement Date” (as defined below), subject to (i) the Participant’s Continuous
Service through the applicable Knock-in Measurement Date on which the Knock-in Requirement is satisfied with respect to such CVAR Tranche and (ii) satisfaction of the Performance Requirement. For purposes of this Agreement, a “Knock-in Measurement Date” means [DATE]. For the sake of clarity, once the Knock-in Requirement with respect to any CVAR Tranche has been satisfied as of the Service Vesting Date
applicable to a CVAR Tranche or a subsequent Knock-in Measurement Date, the Knock-in Requirement shall not be required to be subsequently satisfied. With respect to any CVAR Tranche that has not satisfied the Knock-in Requirement (i.e.,
by virtue of the Fair Market Value of a share of Common Stock equal or exceeding the Knock-in Price as of the Service Vesting Date applicable to such CVAR Tranche or a subsequent Knock-in Measurement Date) on or prior to the Expiration
Date, such CVARs (the “Unsatisfied CVARs”) will nonetheless be eligible to become Vested CVARs as of the Expiration Date, subject to (i) the Participant’s Continuous Service
through the Expiration Date and (ii) satisfaction of the Performance Requirement.
Notwithstanding anything to the contrary herein, in the event of a Change in Control prior to the satisfaction of the Knock-in Requirement, the Knock-in Requirement shall be deemed to have been fully satisfied immediately upon the
occurrence of such Change in Control (and, for the avoidance of doubt, the CVARs shall otherwise remain outstanding and eligible to vest based on achievement of the other applicable Vesting Requirements).
|
|
CVAR Amount and
Payment Terms:
|
Subject to the satisfaction of the Vesting Requirements, as of each applicable Payment Date (as defined below), the Participant will be entitled to receive (subject to the satisfaction of Tax Withholding Obligations in accordance with
the CVAR Award Agreement) an amount equal to the product of (i) the number of CVARs held by the Participant that became Vested CVARs on the applicable Vesting Date multiplied by (ii) the excess
(if any) of (A) the Fair Market Value of a share of Common Stock on the applicable Vesting Date (up to the Cap Price) over (B) the Hurdle Price (the “CVAR Amount”), and the
Vested CVARs will be cancelled in exchange for payment of the CVAR Amount. For the avoidance of doubt, (i) in no event will the Fair Market Value of a share of Common Stock used to determine the CVAR Amount be greater than the Cap Price
and (ii) to the extent applicable, with respect to any Unsatisfied CVARs that become Vested CVARs as of [DATE], in the event the Fair Market Value of a Share of Common Stock as of [DATE] is less than the Hurdle Price, then such
Unsatisfied CVARs shall not constitute Vested CVARs and will be immediately forfeited and cancelled without the payment of any consideration therefor.
The CVAR Amount payable in respect of the applicable Vested CVARs will be settled and delivered within 30 days following the applicable Vesting Date of such Vested CVARs (such actual date of payment, the “Payment Date”).
|
|
Form of Payment:
|
The CVAR Amount payable in respect of the Vested CVARs will be paid to the Participant in the form of shares of Common Stock (such shares of Common Stock, the “CVAR Shares”),
with the number of such CVAR Shares to be determined by dividing (i) the applicable CVAR Amount by (ii) the Fair Market Value of a share of Common Stock on the applicable Payment Date (with any fractional CVAR Shares paid to the
Participant in the form of cash).
|
|
Additional Terms/
Acknowledgements:
|
The Participant acknowledges receipt of, and understands and agrees to, this Agreement and the Plan. The Participant acknowledges and agrees that this Agreement may not be modified, amended or revised, except as provided in the Plan.
By accepting this award of CVARs, the Participant consents to receive such documents by electronic delivery and to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third
party designated by the Company.
|
|
IMMUNOVANT, INC.
|
PARTICIPANT
|
|||
|
Signature:
|
Signature:
|
|||
|
Print Name:
|
Print Name:
|
|||
|
Title:
|
Address:
|
|||
| (a) |
The CVARs shall vest and become payable as set forth in the Grant Notice.
|
| (b) |
Upon the termination of the Participant’s Continuous Service for any reason (other than for Cause), (i) any CVARs that have become Vested CVARs prior to the date of such termination of Continuous Service (the “Termination Date”) which have not yet been settled and cancelled, will be settled and cancelled on the applicable Payment Date in exchange for the applicable CVAR Amount in accordance with the Grant
Notice, and (ii) any CVARs that have not become Vested CVARs will be automatically forfeited and cancelled without the payment of any consideration to the Participant, and the Participant shall have no further rights with respect to such
CVARs.
|
| (c) |
Notwithstanding anything to the contrary in this Agreement, in the event that (i) the Participant’s Continuous Service is terminated for Cause or (ii) the Performance Requirement is not satisfied, then, in each case all of the
Participant’s CVARs shall be automatically forfeited without the payment of any consideration to the Participant, and the Participant shall have no further rights with respect to such CVARs.
|
| (a) |
You acknowledge that, regardless of any action taken by the Company or any Affiliate, the ultimate liability for all income tax, social insurance, payroll tax, fringe benefits tax, or any other tax of any
kind related to the CVARs and legally applicable to you (“Tax-Related Items”) is and remains your responsibility (or that
of your beneficiary). You further acknowledge that the Company (i) makes no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the CVARs, including, but not limited to, the
grant, vesting or settlement of the CVARs or the subsequent sale of shares of Common Stock acquired upon settlement of the CVARs and (ii) does not commit to and is under no obligation to structure
the terms of the grant or any aspect of the CVARs to reduce or eliminate your liability for Tax-Related Items or achieve any particular tax result.
|
| (b) |
Unless otherwise determined by the Committee, upon the vesting and/or settlement of the CVARs (or as of any other date on which the value of any CVARs otherwise become includible in your gross income for
tax purposes) (the “Tax Withholding Date”), you shall be required to pay to the Company, and the Company shall have the
right to deduct from any compensation paid to you pursuant to the CVARs, the amount of any applicable federal, state, local and foreign Tax-Related Items that the Company determines must be withheld with respect to the CVARs (the “Tax Withholding Obligations”). By execution of this Agreement, you hereby consent to, and authorize the Company to, on your behalf,
instruct a registered broker chosen by the Company, at a time when you are not in possession of material nonpublic information, to sell on or as soon as administratively practicable following the applicable Tax Withholding Date, such
number of shares of Common Stock (rounded up to the next whole number) as the Company deems necessary to satisfy (i) the Tax Withholding Obligations and (ii) all applicable fees and commissions due
to, or required to be collected by, the broker (the “Broker Fees”), and the broker shall (A) be required to directly remit
to the Company the portion of the cash proceeds from such sale necessary in order for the Company to satisfy the Tax Withholding Obligations and (B) retain the portion of the cash proceeds from such sale required to cover the Broker
Fees relating directly to such sale (the “Sell-to-Cover Method”). Any excess Tax Withholding Obligations and Broker Fees
not satisfied by the Sell-to-Cover Method as a result of insufficient proceeds from the sales pursuant thereto shall be automatically satisfied by the Company withholding such additional amounts through payroll necessary to satisfy any
such remaining Tax Withholding Obligations and Broker Fees. To the extent the proceeds of such sales pursuant to the Sell-to-Cover Method exceed the Tax Withholding Obligations and the associated Broker Fees, the Company agrees to
remit, or to cause the Broker to remit, to you such excess cash (without interest) as soon as administratively practicable thereafter. You hereby agree and acknowledge that the Company and the broker are under no obligation to arrange
for the sale of shares of Common Stock at any particular price under the Sell-to-Cover Method and that the broker may affect sales as provided hereunder in one or more sales and that the average
price for executions resulting from bunched orders may be assigned to your account. Your further agree and acknowledge that you will be responsible for all brokerage fees and other costs of sale associated with the Sell-to-Cover
Method, and you agree to indemnify and hold the Company and the broker harmless from any losses, costs, damages, or expenses relating to any such sale. In connection with the Sell-to-Cover Method, you shall execute any such documents
requested by the broker or the Company in order to effectuate the Sell-to-Cover Method and payment of the Tax Withholding Obligations, and you agree and acknowledge that the Sell-to-Cover Method shall be subject to additional terms,
conditions and documentation determined to be necessary or appropriate by the Company or the applicable broker in furtherance of this Section 11(b). You acknowledge that this Section 11(b) (and the Sell-to-Cover Method contemplated
hereby) is intended to comply with Section 10b5-1(c)(1) under the Exchange Act and shall be interpreted to comply with the requirements of Rule 10b5-1(c) under the Exchange Act.
|
| (c) |
Notwithstanding anything to the contrary herein, the Company may, in its discretion, permit or require you to satisfy the Tax Withholding Obligations, in whole or in part, through a method other than the
Sell-to-Cover Method described in Section 5(b), including by (i) causing you to tender a cash payment sufficient to satisfy the Tax Withholding Obligations, (ii) withholding from payroll or from any amounts otherwise payable to you by
the Company or any Affiliate in an amount sufficient to satisfy the Tax Withholding Obligations or (iii) by such other method as may be permitted under the Plan or as may be acceptable to the Board.
|
| (a) |
The CVARs and the obligation of the Company to deliver any shares of Common Stock or cash hereunder shall be subject in all respects to (i) all applicable federal and state laws, rules and regulations and (ii) any registration,
qualification, approvals or other requirements imposed by any government or regulatory agency or body which the Committee shall, in its discretion, determine to be necessary or applicable. Moreover, the Company shall not deliver any
certificates for shares of Common Stock to the Participant or any other person pursuant to this Agreement if doing so would be contrary to applicable law. If at any time the Company determines, in its discretion, that the listing,
registration or qualification of shares of Common Stock upon any national securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body, is necessary or desirable, the Company shall
not be required to deliver any certificates for shares of Common Stock to the Participant or any other person pursuant to this Agreement unless and until such listing, registration, qualification, consent or approval has been effected or
obtained, or otherwise provided for, free of any conditions not acceptable to the Company.
|
| (b) |
If at any time the shares of Common Stock are not registered under the Securities Act, and/or there is no current prospectus in effect under the Securities Act with respect to the shares of Common Stock, the Participant shall execute,
prior to the delivery of any shares of Common Stock to the Participant by the Company pursuant to this Agreement, an agreement (in such form as the Company may specify) in which the Participant represents and warrants that the Participant
is acquiring the shares of Common Stock acquired under this Agreement for the Participant's own account, for investment only and not with a view to the resale or distribution thereof, and represents and agrees that any subsequent offer
for sale or distribution of any kind of such shares of Common Stock shall be made only pursuant to either (i) a registration statement on an appropriate form under the Securities Act, which registration statement has become effective and
is current with regard to the shares of Common Stock being offered or sold; or (ii) a specific exemption from the registration requirements of the Securities Act, but in claiming such exemption, the Participant shall, prior to any offer
for sale of such shares of Common Stock, obtain a prior favorable written opinion, in form and substance satisfactory to the Company, from counsel for or approved by the Company, as to the applicability of such exemption thereto.
|
| (c) |
The Participant’s CVARs and any obligation of the Company to deliver the underlying shares of Common Stock, if any, upon settlement of the CVARs shall be subject in all respects to (i) all applicable federal and state laws, rules and
regulations, (ii) any regulation, qualification, approvals or other requirements imposed by any government or regulatory agency or body which the Board shall, in its sole discretion, determine to be necessary or applicable and (iii) the
terms of any Shareholders Agreement entered into by and among the Company and each of the shareholders of the Company that is a party thereto, as may be amended or in effect from time to time (the “Shareholders Agreement”). Moreover, the CVARs may not be settled if its settlement, or the receipt of shares of Common Stock pursuant thereto, would be contrary to applicable law. Any shares of Common Stock
received upon any settlement of the CVARs shall be held subject to all of the terms and conditions of the Shareholders Agreement. The Participant hereby agrees to execute and become a party to the Shareholders Agreement as a condition to
the grant of the CVARs and be subject to the rights and obligations thereunder, and the Company may require the Participant to execute a joinder to the Shareholders Agreement in connection with the settlement of the CVARs for shares of
Common Stock.
|